yogi polyesters ltd Directors report

YOGI POLYESTERS LIMITED ANNUAL REPORT 1999-2000 DIRECTORS REPORT To, The Members Your Directors are pleased to submit their Eighth Annual Report of the Company for the year ended 31st March, 2000. 1. REVIEW OF OPERATIONS : The Textile Industry continues to passing through a serious crisis during the last four years due to economic recession and acute shortage of money in the market and large scale closure of cloth weaving sectors like Bhiwandi, Surat, North Gujarat etc. Besides the excess capacity of production both in Polyester Filament Yarn and Polyester Fibre in the country as well as cheaper imports from South East Asia, of yarn and ready to stitch cloth had resulted in continued reduction in price of Polyester Filament Yarn. Beside there is continuous increase in the power cost with the result operation of upstream and down-stream yarn industries are becoming unremunerative resulting in large scale closure in texturising, twisting and weaving industries. A large number of POY units are facing severe financial difficulties and some of these are being taken over by a major synthetic yarn producer in the country. In such circumstances running the plant by purchase of raw materials and sale of finished products would result in severe cash losses. As mentioned in the last Annual Report the management had decided to keep the plant in operative condition and wait for a better market scenario by undertaking conversion jobs from Maskara Industries Ltd. The conversion arrangements were continued till 29/6/99. The arrangement for conversion made with M/s. Maskara Industries Ltd., Mumbai had also started showing signs of difficulties because of fall in prices of black yarn. Their price of the black yarn declined whereas the price of raw-material were going up resulting in the margin substantially reduced. Since their operation were become unremunerative, the conversion arrangements made was stopped on 29/6/99 and the plant was under shutdown condition thereafter. In view of the loss having exceeded the networth an application has been made to BIFR on 4th September 2000. 2. DIVIDEND : In view of the losses, the Directors regret their inability to recommend any dividend for the financial year ended on 31st March, 2000. 3. INSURANCE : All the properties and insurable interest of the Company including plant and machinery, buildings and stocks are adequately insured. 4. APPOINTMENT OF DIRECTOR : Shri G. B. Singh, Director of the Company will retire by rotation and is eligible for reappointment. Members are requested to consider his reappointment. 5. FIXED DEPOSIT : Company has not accepted Fixed Deposit from the public as envisaged under section 58A & 58B of Companies Act, 1956 read with Companies (Acceptance of Deposit) Rules, 1975. 6. AUDITORS REPORT : The observations made in the Auditors Report are self explanatory and therefore do not call for any further comments under section 217 of the Companies Act, 1956. 7. APPOINTMENT OF AUDITORS : The term of M/s. D.N.Shukla & Co. expires at the conclusion of the 8th Annual General Meeting and they are eligible for reappointment. The Auditors have given a certificate to the effect that the proposed reappointment as Auditors of the Company for the Financial Year 2000-2001, if made, would be in accordance within the limits prescribed under sub- section (1 B) of Section 224 of the Companies Act, 1956. 8. CONSERVATION OF ENERGY TECHNOLOGY : The Plant arid Machineries were operated in the most optimum way to consume minimum power. 9. FOREIGN EXCHANGE EARNING AND OUT GO : During the year there was no earning and outgo in foreign exchange. 10. PARTICULARS OF EMPLOYEES : The particulars of employees as envisaged under section 217 (2A) read with (Particulars of Employees) Rules 1975 is not furnished as no employee is covered thereunder. 11. Y2K COMPLIANT : The proactive steps taken by the Company ensured smooth transition into year 2000 without any disruption to the operations of the Company. 12. ACKNOWLEDGEMENT : The Board expresses its gratitude and would like to place on record its sincere appreciation for the continued cooperation and support provided during the year by the Government of India, Government of Gujarat. The Board of Directors also wish to place on record their deep sense of appreciation for the dedicated services rendered by the officers and employees of the Company. On behalf of the Board of Directors YOGI POLYESTERS LIMITED V.N.JIKAR Chairman Date : 4th September, 2000 Place: VADODARA