Dear Shareholders:
We have pleasure in presenting the 25 Annual Report of your Company
together with the Audited Accounts for the financial year ended 31
March 2011. The summarized financial results (stand-alone and
consolidated) are given below in Table 1.
Table 1: Financial Highlights: Stand-Alone and Consolidated
(Rs. crore)
Particulars Standalone Consolidated
2010-11 2009-10 2010-11 2009-10
Sales / Job charges (net
of excise) 6,388.43 4,311.17 6,614.90 4,424.34
Other Income 19.43 64.02 5.03 64.68
Total Income 6,407.65 4,375.19 6,619.93 4,489.02
Total Expenditure 4,638.51 3,102.71 4,912.69 3,257.23
Operating Profit before
interest, depreciation
& taxes 1,756.35 1,272.48 1,723.24 1,231.79
Interest 654.37 535.08 675.03 578.90
Depreciation 518.79 362.61 530.97 366.92
583.19 374.79 501.24 285.97
Less : Provision for
Taxation
– Current (120.57) (63.56) (123.52) (65.94)
– MAT credit entitlement 42.25 34.26 42.25 34.26
– Deferred (100.68) (99.01) (97.34) (96.96)
– Fringe Benefit Tax – – – 0.02
– Prior period adjustment
of Tax 0.17 0.86 0.11 0.46
Net Profit from Ordinary
Activities After Tax 404.36 247.34 322.73 157.81
– – – –
Profit After Tax 404.36 247.34 322.73 157.81
Add : Share of Profit
from Associates – – (10.89) (20.74)
: Minority Interest – – (0.31) 0.64
Profit After Tax After
Minority Interest 404.36 247.34 311.54 137.71
Add : Balance Brought
Forward 180.91 276.63 (52.48) 149.78
Balance available for
appropriation 585.27 523.97 259.06 287.49
Excess Provision of
Dividend for Earlier Years – (0.00) 0.40 0.15
Dividend: Equity 19.69 19.69 19.69 19.69
Tax on Dividend 3.27 3.27 3.27 3.27
Transfer to Capital
Redemption Reserve – – – –
Transfer to Debenture
Redemption Reserve (384.30) 300.10 (384.30) 296.63
Transfer to General Reserve 25.00 20.00 25.03 20.23
Balance carried to
Balance Sheet 921.61 180.91 594.97 (52.48)
Notes: Previous years'' figures have been regrouped wherever necessary
to bring them in line with the current year''s representation of figures
Performance
During the financial year, your Company sales increased by 48.18% to
Rs. 6,388.43 crore and achieved profit after tax of Rs. 404.36 crore,
an increase of 68.48 % over the previous year. The exports of your
Company for the year, including incentives, increased by 42.24% to Rs.
2,217.43 crore. All the divisions of your company recorded growth both
in domestic and export sales.
Details of your Company''s performance for the year under review are
given in the ''Management Discussion and Analysis'', which forms part of
this Directors'' Report.
Dividend
Your Directors have recommended a dividend of Rs. 0.25 per equity share
of Rs. 10/ – each (previous year Rs. 0.25 per share) for the financial
year ended 31 March 2011 and seek your approval for the same. If
approved, the total amount of dividend to be paid to the equity
shareholders will be Rs. 19.69 crores (excluding tax of Rs. 3.27
crores). Based on the above dividend payout (including dividend tax),
the dividend payout ratio works out to 5.68% of Profit After Tax (PAT)
as against 9.28% for 2009-10.
Capital
During the year under review, your Company, as per the terms of Letter
of Offer dated 19 March 2009 and relevant provisions of Articles of
Association of the Company, forfeited 13,921 partly paid rights equity
shares held by 83 shareholders for non- payment of allotment money of
Rs. 5/ – and interest due thereon.
Consequent to the forfeiture of Rights shares the Company''s equity
share capital as on 31 March 2011 stands at Rs. 787.78 crore divided
into 78,77,84,357 fully paid equity shares of Rs. 10/ – each.
FCCBs
The 475 outstanding FCCBs of USD 50000 each aggregating to Rs. 107.21
crore as at 31 March 2010 were redeemed during the year, on their due
date i.e. 26 May 2010.
Reserves
The balance available for appropriation as at 31 March 2011 amounted to
Rs. 585.27 crores. After providing for dividend and dividend tax of Rs.
22.96 crore, your Company proposes to transfer Rs. 384.30 crore to
Debenture Redemption Reserve and Rs. 25.00 crore to General Reserve.
After providing for these, the balance of the Profit & Loss Account
would stand at Rs. 920.61 crore.
At the end of the financial year, the total reserves of the company,
stood at Rs. 2309.08 crores compared to Rs. 1928.40 crore in at the end
of previous year.
Loans
During the year under review, your Company has raised incremental debt
of Rs. 1143.89 crore, both secured and unsecured, by way of rupee
loans, foreign currency loans and non-convertible debentures for
meeting capital expenditure and working capital requirements. The total
debt at the end of year stood at Rs. 9653.57 crore compared to Rs.
8509.68 crore at the end of previous year.
Capital Expenditure
During the year under review, your company has incurred a capital
expenditure of Rs. 1862.92 crore across various divisions. A major
portion of these were towards cotton spinning, expansion of weaving and
processing capacities, setting up additional Continuous Polymerization
(CP) plant, expansion of Texturising Plant and regular capex.
Details of your Company''s capacities across various divisions are
provided under the head ''Capacity Expansion'' in the Management
Discussion and Analysis annexed to this Report.
Merger
Your Directors at their meeting held on 29 July 2011 approved the
proposal of amalgamation of Grabal Alok Impex Limited (''GAIL'') into the
Company as per terms and conditions mentioned in the Scheme of
Amalgamation to be filed with the stock exchanges. The salient features
of the proposed Scheme are as under:
(a) Amalgamation of GAIL with the Company;
(b) The Appointed Date of the Scheme will be 1 April 2011;
(c) The Com pany to issue its shares to the shareholders of GAIL as on
record date, based on the share exchange ratio determined by the
independent valuers, M/s Ernst & Young Private Limited and the fairness
report provided by Fortune Financial Services (India) Limited and
approved by the Board of Directors of the Company which is as under:
1 (One) fully paid up equity share of Rs. 10 each of the Company shall
be issued and allotted for every 1 (One) equity share of Rs. 10 each
held in GAIL
(d) The Scheme is subject to approval of the shareholders, creditors,
the Financial Institutions /Banks, the Hon''ble High Court of Bombay,
relevant stock exchanges and any other statutory or regulatory
authorities, which by law may be necessary for the implementation of
the Scheme.
Subsidiary Companies
At the end of the financial year under review, your Company had the
following subsidiaries:
Subsidiaries of Alok Industries Limited
1. Alok Industries International Ltd. (incorporated in the British
Virgin islands)
2. Alok International Inc. (incorporated in the state of New York,
USA)
3. Alok Inc. (incorporated in the state of New York, USA)
4. Alok Infrastructure Limited
5. Alok H&A Limited
6. Alok Retail (India) Limited (Formerly known as Alok Homes & Apparel
Private Limited)
7. Alok Apparels Private Limited
8. Alok Land Holdings Private Limited
Step-down subsidiaries of Alok Industries Limited
Parent Company Subsidiary %Holding
Alok Industries
International Ltd. Mileta, a.s.(incorporated in the
Czech Republic) 100% holding
Alok European Retail, s.r.o. 100% holding
Alok
Infrastructure
Limited Alok Realtors Private Limited 100% holding
Alok HB Hotels Private Limited 100% holding
Alok HB Hotels Properties Limited 100% holding
Springdale Information and Technologies
Private Limited 100% holding
Kesham Developers & Infotech Private
Limited 100% holding
Alok Land Holdings
Private Limited Alok Aurangabad Infratex Private
Limited 100% holding
Alok New City Infratex Private Limited 100% holding
The Ministry of Corporate Affairs, Government of India has issued a
Circular No.2 / 2011 dated 8 February 2011 granting general exemption
to Companies under section 212 (8) from attaching the documents
referred to in section 212 (1) pertaining to its subsidiaries, subject
to approval by the Board of Directors of the Company and furnishing of
certain financial information in the Annual Report.
The Board of Directors of the Company have accordingly accorded
approval for dispensing with the requirement of attaching to its Annual
Report the annual audited accounts of the Company''s subsidiaries.
Accordingly, the Annual Report of the Company does not contain the
individual financial statements of these subsidiaries, but contains the
audited consolidated financial statements of the Company, its
subsidiaries and associate. The Annual Accounts of these subsidiary
companies and the related detailed information will be made available
to the shareholder of the holding and subsidiary companies seeking such
information at any point of time. The annual accounts of the Subsidiary
Companies will also be kept for inspection by any shareholder at its
registered / corporate office and that of the concerned subsidiary
companies. The statement pursuant to the approval under section 212 (8)
of the Companies Act, 1956 is annexed together with the Annual Accounts
of the Company.
Consolidated financial statements
The Consolidated Financial Statements of the Company prepared as per
the Accounting Standard AS 21 and Accounting AS 23, consolidating the
Company''s accounts with its subsidiaries and an associate have also
been included as part of this Annual Report.
Shift in Registered Office
The registered office of your company was shifted from ''B/43, Mittal
Tower, Nariman point, Mumbai 400 021, Maharashtra'' to ''17/5/1 & 521/1
Rakholi / Saily, Silvassa - 396 230, Union Territory of Dadra & Nager
Haveli effective from 25 June 2010 pursuant to an Order passed by the
Company Law Board.
Business and Operations
The business prospects of your company are quite encouraging
considering the demand outlook in domestic as well as export markets.
The drivers of growth are however different for both the markets.
More details about your Company''s business operations and new
initiatives are contained in the Management Discussion & Analysis.
Awards and Recognition
During the year under review, your Company was awarded the following
awards and recognitions by the Cotton Textile Exports Council of India
(TEXPROCIL) in three categories:
- Gold Trophy in Highest Exports of Bleached/ Dyed/ Yarn - dyed/
Printed Fabrics
- Gold Trophy in - Highest Exports of Bed - Linen/ Bed sheets/ Quilts
- Silver Trophy in - Highest Global Exports
- The Company is the proud winner of IMC - Ramakrishna Bajaj National
Quality (RBNQ) Performance Excellence Trophy - 2010 in its maiden
attempt
Corporate Social Responsibility
Details of your Company''s Corporate Social Responsibility (CSR)
initiatives are given in a separate section, ''Sustainability'', which
forms part of the accompanying Management Discussion and Analysis and
Annual Report.
Corporate Governance
A separate report on Corporate Governance is enclosed as a part of this
Annual Report. A certificate from the Statutory Auditors of your
Company regarding compliance with Corporate Governance norms stipulated
in Clause 49 of the Listing Agreement is also annexed to the report on
Corporate Governance.
Fixed Deposits
Your Company does not have any fixed deposits under section 58A and
58AA of The Companies Act, 1956 read with Companies (Acceptance of
Deposits) Rule, 1975.
Insurance
All the insurable interests of your Company including inventories,
buildings, plant and machinery are adequately insured.
Directors
Mr. Chandrakumar Bubna and Mr. Timothy Ingram will retire from office
by rotation at the ensuing Annual General Meeting and, being eligible,
offer themselves for reappointment. Brief resumes of these Directors,
in line with the stipulations of Clause 49 of the Listing Agreement,
are provided elsewhere in this Annual Report.
During the year, A. B. Dasgupta, nominee director of IDBI Bank Limited,
resigned from the Board of Directors w.e.f. 1 November 2010 and in his
place Mr. Debashish Mallick was appointed as IDBI''s nominee. The Board
wishes to place on record their appreciation for the contribution of
Mr. A. B. Dasgupta during his tenure as Directors of your Company.
Directors'' Responsibility Statement
Pursuant to section 217(2AA) of the Companies Act, 1956, your Directors
subscribe to the ''Directors'' Responsibility Statement'' and hereby
confirm that:
- in the preparation of the annual accounts for the financial year
ended 31 March 2011, the applicable Accounting Standards have been
followed and there has been no material departure;
- the Directors have selected such accounting policies, consulted and
applied them consistently and made judgements and estimates that are
reasonable and prudent so as to give a true and fair view of the state
of affairs of your Company as at 31 March 2011 and of the profit of
your Company for the year on that date;
- the Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act,1956 for safeguarding the assets of
your Company and for preventing and detecting fraud and other
irregularities;
- they have prepared the annual accounts for the financial year ended
31 March 2011 on a ''going concern'' basis.
Auditors and Auditors'' Report
M/s. Deloitte Haskins & Sells, Chartered Accountants and M/s Gandhi &
Parekh, Chartered Accountants, Statutory Auditors of the Company, hold
office until the conclusion of the ensuing Annual General Meeting and
are eligible for re-appointment.
The Company has received letters from the above named Auditors to the
effect that their re-appointment, if made, would be within the
prescribed limits under section 224 (1B) of the Companies Act, 1956 and
that they have not disqualified for re- appointment within the meaning
of the section 226 of the said Act.
The observations made in the Auditors'' Report are self-explanatory and
therefore, do not call for any further comments under section 217(3) of
the Companies Act, 1956.
Cost Auditor
Pursuant to the directives of the Central Government under the
provisions of Section 233B of the Companies Act, 1956 and subject to
the approval of the Central Government, M/s B. J. D. Nanabhoy & Co.,
Cost Accountants, Mumbai have been appointed as Cost Auditors to
conduct cost audit relating to the products manufactured by your
Company.
Particulars of Employees
The information required on particulars of employees as per Section
217(2A) of the Companies Act, 1956, read with Companies (Particulars of
Employees) Rules, 1975 forms part of this Report. As per the provisions
of Section 219(1)(b)(iv) of the Companies Act, 1956, the Report and
Accounts are being sent to all shareholders of your Company excluding
the Statement of Particulars of Employees. Any shareholder interested
in obtaining a copy of the said statement may write to your Company
Secretary at the Corporate Office of your Company.
More details on the Human Resources function of your Company and its
various activities are given in the ''Human Resources'' and
''Sustainability'' sections of the attached Management Discussion &
Analysis.
Your Directors appreciate the significant contribution made by the
employees to the operations of your Company during the year.
Conservation of Energy, Technology absorption, Foreign Exchange
Earnings and Outgo
The particulars as prescribed under Section 217(1)(e) of the Companies
Act, 1956, read with the Companies (Disclosure of Particulars in the
Report of the Board of Directors) Rules, 1988 are attached as Annexure
A to this report.
Acknowledgements
On the occasion of completing 25 years, your Directors wish to place on
record their deep sense of appreciation for all the stake holders of
your company who have been continuously supporting the growth of your
Company. In particular, the Directors value the dedication and
commitment of your Company''s employees and thank the Central and State
Governments, Financial Institutions, Banks, Government authorities,
customers, vendors and shareholders for their continued cooperation and
support.
For and on behalf of the Board
Place: Mumbai Dilip B. Jiwrajka
Date: 29 July 2011 Managing Director
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