The directors have pleasure in presenting the sixteenth annual report
of the Company and the audited accounts for the year ended 31st March
1. FINANCIAL HIGHLIGHTS
(Rs. in lakhs)
Year ended Year ended
Sales and other income 30890.03 24231.80
Gross profit before financial
costs, depreciation and amortization
expenses and tax 2,364.22 594.85
Financial costs 663.70 747.29
amortization expenses 434.38 431.66
Profit / (Loss) before
exceptional items and tax 1,266.14 (584.10)
Exceptional items (income) 151.82 -
Profit before tax 1,417.96 (584.10)
Provision for taxation 295.95 (74.11)
Profit / (Loss) after tax 1,122.01 (509.99)
Add: Surplus brought forward (493.99) 17.20
Profit / (Loss) available
appropriation 628.02 (492.79)
Tax relating to earlier years (3.25) (1 20)
Proposed Interim Dividend 271.92 -
Dividend tax payable 27.48 -
Transfer to general reserve 112.20 -
Surplus in profit and loss
forward 213.17 (493.99)
The board of directors of the Company at their meeting held on 30th May
2012, declared an interim dividend of Rs.3.50 per share for the year
ended 31st March 2012, absorbing a sum of Rs.299.40 lakhs (including
dividend distribution tax) on 77,69,040 equity shares of Rs.10/- each
fully paid up. The same will be paid on or after 11th June 2012.
The directors of the Company do not recommend any further dividend for
the year under consideration.
4. SUBSIDIARY COMPANY
As on the date of this report, Harita Fehrer Limited, Chennai (HFRL) is
the only subsidiary of the Company. HFRL is a material non-listed
Indian subsidiary in terms of sub-clause III of Clause 49 of the
Listing Agreement, as the total turnover of the subsidiary exceeds 20%
of the consolidated turnover of the Company.
The Company is fully compliant with the provisions as specified in
sub-clause III of Clause 49 of the Listing Agreement. During the
financial year 2011-12, HFRL achieved an income of Rs. 294.76 Cr and
registered a profit after tax of Rs. 11.04 Cr. It had declared a maiden
dividend of 10% for the year 2011 -2012.
5. CONSOLIDATED FINANCIAL STATEMENTS
The annual accounts of the subsidiary for the year ended 31st March
2012 is consolidated with the accounts of the Company in accordance
with Accounting Standards as prescribed under Section 211(3C) of the
Companies Act, 1956 and as required under the Listing Agreement. These
financial statements disclose the assets, liabilities, income, expenses
and other details of the Company and its subsidiary.
The Ministry of Corporate Affairs (MCA) vide its circular No. 2 in file
No. 51/12/2007-CL-III dated 8th February 2011 has granted general
exemption under Section 212(8) of the Companies Act, 1956 for holding
companies from attaching annual reports of subsidiaries along with its
annual report without seeking any approval of the Central Government.
However, this is subject to fulfillment of conditions as stipulated in
the said circular granting general exemption to the holding company and
passing of a resolution by the board of the holding company in this
The board of directors at the meeting held on 30th May 2012 passed
necessary resolution for complying with all the conditions enabling the
circulation of annual report to the shareholders of the Company without
attaching all the documents of the subsidiary company, referred to in
Section 212(1) of the Companies Act, 1956. The annual accounts,
reports and other documents of the subsidiary company will be made
available to the members, on receipt of a request from them. The
annual accounts of the subsidiary company will be available at the
registered office of the Company and at the registered office of the
subsidiary company. If any member or investor wishes to inspect the
same, it will be available during the business hours of any working day
at the registered office of the Company.
A statement giving the following information about HFRL consisting of
(a) capital (b) reserves (c) total assets (d) total liabilities (e)
details of investment (f) turnover (g) profit before taxation (h)
provision for taxation (i) profit after taxation and (j) proposed
dividend, has been attached with the consolidated balance sheet of the
Company in compliance with the conditions as provided in the circular
issued by MCA.
Mr Martin Grammer, director, retires at the ensuing annual general
meeting of the Company and being eligible, offers himself for
Mr Ram Natarajan was appointed as an additional, non executive and
independent director of the Company effective 10th November 2011. Mr
Ram Natarajan will hold office upto this annual general meeting.
A notice in terms of Section 257 of the Companies Act, 1956 has been
received from a member of the Company signifying his proposal for the
appointment of Mr Ram Natarajan as a director of the Company.
The brief resume of Mr Martin Grammer and Mr Ram Natarajan, directors,
have been detailed in the notice convening the annual general meeting
of the Company. Appropriate resolutions for their re-appointment and
appointment are being placed for approval of the shareholders at the
ensuing annual general meeting. The directors recommend their
re-appointment / appointment as directors of the Company.
M/s.Sundaram & Srinivasan, Chartered Accountants, Chennai, retire at
the ensuing annual general meeting and are eligible for re-appointment.
The Company has received a letter from them, stating that the
appointment, if made, will be within the limit prescribed under Section
224(1 B) of the Companies Act, 1956.
8. COST AUDITOR
MCA issued an industry specific Cost Audit Order vide No.
52/26/CAB-2010 dated 24th January 2012, thereby requiring all such
companies, which are in the manufacturing activities of automotive
components (covered under Central Excise Tariff Chapter Nos. 84, 87) to
appoint a Cost Auditor for auditing the cost accounting information
effective 1st April 2012 for the financial year 2012-13 and file a
report with the Central Government, on or before 30th September of
The board of directors, in view of this industry specific order, at
their meeting held on 30th May 2012 appointed M/s. Raman & Associates,
Cost Accountants, Chennai, as Cost Auditor for carrying out the cost
audit of the Company for the financial year 2012-2013, subject to the
compliance of all the requirements, as stipulated in circular
no.15/2011 dated 11th April 2011 issued by MCA and subject to the
approval of the Central Government.
The Company has received a letter from the said Cost Audit firm,
stating that the appointment, if made, will be within the prescribed
limit under Section 224(1 B) of the Act.
For the financial year under review, a Cost Compliance report will be
obtained and filed with MCA on or before 30th September 2012 in terms
of Companies (Cost Accounting) Records Rules, 2011.
9. CORPORATE GOVERNANCE
The Company has been practicing the principles of good corporate
governance over the years and lays strong emphasis on transparency,
accountability and integrity.
A separate section on Corporate Governance and a certificate from the
statutory auditors of the Company regarding compliance of conditions of
Corporate Governance as stipulated under Clause 49 of the Listing
Agreement with the Stock Exchanges form part of the Annual Report.
The president and the general manager - finance of the Company have
certified the financial statements and other connected matters in
accordance with Clause 49(V) of the Listing Agreement pertaining to
CEO/CFO certification for the financial year ended 31st March 2012.
10. STATUTORY STATEMENTS
a. Conservation of energy, technology absorption and foreign exchange
earnings and outgo:
As per the requirements of Section 217(1)(e) of the Companies Act,
1956, read with The Companies (Disclosure of Particulars in the Report
of Board of Directors) Rules, 1988, information regarding conservation
of energy, technology absorption and foreign exchange earnings and
outgo are given in Annexure I to this report.
b. Particulars of employees:
There is no employee receiving remuneration in excess of the limits
prescribed under Section 217 (2A) of the Companies Act, 1956, read with
the Companies (Particulars of Employees) Rules 1975 as amended.
c. Public Deposits:
The Company has not accepted any deposit from the public within the
meaning of Section 58A of the Companies Act, 1956, for the year ended
31st March 2012.
d. Directors'' Responsibility Statement: Pursuant to the requirement of
Section 217(2AA) of the Companies Act, 1956 with respect to directors''
responsibility statement, it is hereby confirmed:
(i) that in the preparation of annual accounts for the financial year
ended 31st March 2012, the applicable accounting standards had been
followed and there were no material departures;
(ii) that the directors had selected such accounting policies and
applied them consistently and made judgments and estimates that were
reasonable and prudent so as to give a true and fair view of the state
of affairs of the Company at the end of the financial year and of the
profit of the Company for the year under review;
(iii) that the directors had 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
the Company and for preventing and detecting fraud and other
(iv)that the directors had prepared the accounts for the financial year
ended 31st March 2012 on a going concern basis.
The directors acknowledge the support and co- operation received from
the promoters, Harita Group and Mr Martin Grammer.
The directors thank the customers, suppliers, financial institutions
and bankers for their valuable support and assistance.
The directors wish to place on record their appreciation of the sincere
efforts of all the employees of the Company during the year under
The directors also thank the shareholders for their continued faith in
For and on behalf of the Board
Chennai H LAKSHMANAN
30th May 2012 Chairman