The Directors have pleasure in presenting the 48th Annual Report and
Accounts for the year ended 31st March, 2012.
The highlights of the financial results are as follows:
Year ended Year ended
March 2012 March 2011
(Rs. in Lacs) (Rs. in Lacs)
Profit before taxation 2,562 1.940
Less: Provision for taxation:
Current tax 905 634
Deferred tax (98) 93
Profit after tax 1,755 1.213
Balance in Profit & Loss Account brought
forward from Previous Year 3,173 2,404
Profit balance available for appropriation 4,928 3.617
Dividend including Proposed Dividend 273 278
Tax on dividend 43 44
Transfer to General Reserve 132 122
Balance in Profit & Loss Account Carried
Forward to Balance Sheet 4,480 3.173
During the financial year ended 31st March, 2012, the net profit after
tax of the company was Rs.1,755 lacs, an increase of 44.7 % over the
previous year''s net profit after tax of Rs. 1,213 lacs. The turnover
was higher at Rs. 673 crores as compared to Rs. 591 crores of the
previous year, showing a increase of 14 %.
The Directors are pleased to recommend a dividend of Rs. 2.00 [20 %]
per equity share for the financial year ended 3151 March, 2012.
The continuing crisis in the Eurozone has not dampened the investments
in water & environment management. The Indian Government continues to
announce measures to improve the environmental health of the country
and your company expects to benefit from it.
However, the business confidence has been impacted by concerns on the
economic front. This has resulted in a slight reduction in the pace of
investments by the private sector in new projects. As mentioned earlier
we expect the slack to be taken up by the increased public sector
Your Company will continue its endeavour to expand operations globally
with focus on emerging economies. Joint ventures with the local players
in such countries are under active consideration. We will also be
looking at increasing our presence in the rural sector. This will be
achieved through increased penetration and introduction of more
products suited to the rural requirements.
We continue to raise the bar of quality for our various products and
production facilities with globally accepted quality certifications. In
continuation of this endeavour our resin facility now has ISO 9000, ISO
14000, Halal and WQA Gold Seal certifications. The new FDA compliant
facility will also start operations shortly
Price volatility in the cost of inputs continues to impact the margins.
However, the timely measures taken by your Company has minimised the
adverse impact to a large extent. It is expected that the volatile
situation in the raw material costs will not change radically in the
future. We will continue to take proactive measures to effectively
minimise the impact of price volatility.
Your company''s emphasis on innovative technology, research &
development and comprehensive product mix for environment management
should ensure ability to counter uncertain business environment and
report continuing improvement in performance.
FINANCIAL RESOURCES Share Capital
Under Employees Stock Option Scheme - ESOS - 2008, the Employees'' Stock
Option Compensation Committee (ESOCC) allotted 1,31,950 equity shares
[82,900 equity shares under ESOS - 2008], 4,000 equity shares under
ESOS 2005 [9,500 equity shares under ESOS - 2005] to the directors and
employees of the Company. The paid-up equity capital of the Company
increased from Rs. 13,42,59,110/- to Rs. 13,56,18,610/- after
As on 31st March, 2012, 123 fixed deposits amounting to Rs. 24,50,000/-
remained unclaimed. 20 Deposits amounting to Rs. 4,84,000/- have been
renewed / claimed since then.
EMPLOYEES'' STOCK OPTION SCHEMES
The details of Employees'' Stock Option Schemes ESOS - 2001, ESOS
- 2003, ESOS - 2005 and ESOS - 2008 as required to be given under SEBI
(Employees Stock Option Scheme and Employees Stock Purchase Scheme)
Guidelines, 1999, as amended, are given in the Report on Corporate
RESTRUCTURING OF BUSINESS
Pursuant to Board and Shareholders'' approval for the proposal to sell
the Project Division (covering domestic turnkey projects) on a going
concern basis to Ion Exchange Projects and Engineering Limited, a
wholly owned subsidiary company, the Company is in the process of
completing all the necessary formalities for the above mentioned
Aqua Investments (India) Ltd. and Watercare Investments (India) Ltd.
During the year ended 31st March, 2012, the Subsidiary companies M/s.
Aqua Investments (India) Limited posted profit of Rs. 8.29 lacs
compared to Rs. 6.54 lacs of the previous year and M/s. Watercare
Investments (India) Ltd. posted profit of Rs. 6.55 lacs compared to Rs.
5.27 lacs of the previous year.
Ion Exchange Enviro Farms Limited (IEEFL)
The Company improved its performance by focusing on select Farms and
Product groups. The operating income rose from Rs.78,48 lacs (2010-11)
to Rs.108.26 lacs. However due to erratic climatic conditions & other
local environmental factors the optimum operational performance could
not be reached.
Due to product improvement through R&D the sale of Farm Inputs (e.g.
ENVIRO REACH) has increased from Rs.52 lacs to Rs.75 lacs in the
current year. The Company expects to enter into new geographies and
also new market segments like chilli & other vegetables which will
increase the turnover substantially.
Ion Exchange Infrastructure Limited
The Company achieved turnover of Rs. 4,498.34 lacs as compared to Rs.
3,846.93 lacs for the previous year. The profit after tax was at Rs.
10.71 lacs compared to Rs.14.09 lacs for the previous year.
The Company has been established with a view to undertake projects for
intake water, water treatment, distribution and waste management on
lumpsum turnkey basis. The Company will also provide comprehensive
technical and process assistance services such as consultancy, design,
detailed engineering and turnkey contracting.
Ion Exchange Asia Pacific Pte Ltd., Singapore and Ion Exchange Asia
Pacific (Thailand) Ltd., Thailand
The Company achieved a consolidated turnover of Rs. 843.72 lacs for the
year under review as compared to 1,410.95 Lacs for the previous year.
The performance of the Company was adversely affected due to uncertain
economic conditions in South East Asia & resultant deferment of capital
expenditure by customer.
IEI Environmental Management [MJ SDN. BHD, Malaysia
The Company achieved a turnover of Rs. 42.44 lacs for the year under
The Company''s main activity is trading in water filtration equipments,
water chemicals, resins and taking up projects of installing water
filtration plants of any nature. The Company has been established with
a view of facilitating operations in Malaysia and is a strategic
investment which would be crucial for increasing the overall Exports to
Ion Exchange Environment Management (BD) Limited, Bangladesh The
Company achieved a turnover of Rs. 550.29 lacs for the year under
The Company is set up with a view to strengthen and widen the
Company''s presence in the Bangladesh market.
After the successful commissioning of assembly shop in Bangladesh, the
local business has shown good growth in turnover and this enabled the
Company to maintain profit. The Company''s major focus has been waste
water treatment plants and chemicals in Bangladesh market. The Company
plans to enter into infrastructure projects in Bangladesh
Ion Exchange WTS (Bangladesh) Limited, Bangladesh
At present there are no activities in this company. Various options are
being explored for streamlining and consolidating the activities of
this company along with other wholly owned subsidiery company in
Bangladesh viz: Ion Exchange Environment Management (BD) Limited.
Ion Exchange & Co. LLC, Oman
The Company achieved a turnover of Rs. 39.74 crores for the year under
The Company is set up to address the needs of Middle East market
The Company is approved by PDO (OMAN). The Company has performed well
during the year under review and has declared interim dividend of 60%.
The Company has secured two big orders from local petroleum company and
European EPC contractor in Oman. One of these jobs, is a 7 years O&M
contract for five sea water plants. In order to handle the O&M
contract, the company is expanding employee strength which will also be
beneficial for further business generation.
Ion Exchange LLC, USA
The Company achieved a turnover of Rs. 17.09 crores for the year under
This subsidiary is established to address the needs of US market. The
Company''s operations will substantially benefit and address the
parent company''s needs in the US.
In spite of slow economic recovery in USA the Company was able to
increase the resin sales business in USA. The Company expects that the
growth will continue in the current financial year.
Ion Exchange Projects and Engineering Limited
The Company was incorporated on 9th April, 2012. Pursuant to Board and
Shareholders'' approval for the proposal to sell the Project Division
(covering domestic turnkey projects) on a going concern basis to Ion
Exchange Projects and Engineering Limited, the Company is in the
process of completing all the necessary formalities to implement the
Global Composites and Structural''s Limited
The Company achieved a turnover of Rs. 23 crores for the year under
The Company is in the business of providing integrated engineering
services across the life cycle of a project and has expertise in
manufacture of RO Pressure Tubes and FRP Tanks and electrical load
distribution for water treatment Industries.
A statement as required under Section 212 of the Companies Act, 1956,
is attached to the Annual Report.
In accordance with the general circular issued by the Ministry of
Corporate Affairs, Government of India, the Balance Sheet. Profit and
Loss Account and other documents of the subsidiary companies are not
being attached with the Balance Sheet of the Company. The Company will
make available the Annual Accounts of the subsidiary companies and the
related detailed information to any member of the Company who may be
interested in obtaining the same. The annual accounts of the subsidiary
companies will also be kept open for inspection at the Registered
Office of the Company and that of the respective subsidiary companies.
The Consolidated Financial Statements presented by the Company include
the financial results of its subsidiary companies.
CONSOLIDATED FINANCIAL STATEMENTS
As required by Accounting Standard 21 ''Consolidated Financial
Statements'' issued by the Institute of Chartered Accountants of India,
the audited Consolidated Financial Statements of the Group are
Mr. Akhil Marfatia, Mr. Shishir Tamotia and Mr. M. P. Patni retire by
rotation and being eligible offer themselves for re-appointment.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to the requirement under Section 217(2AA) of the Companies
Act, 1956 with respect to Directors'' Responsibility Statement, it is
hereby confirmed that:
(i) in the preparation of the annual accounts for the year ended 31st
March, 2012, the applicable accounting standards have been followed
along with proper explanation given relating to material departures;
(ii) appropriate accounting policies have been selected and applied
consistently and judgments and estimates were made 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 that period;
(iii) 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 irregularities have been taken
to the best of their knowledge;
(iv) the annual accounts have been prepared for the financial year
ended 31st Marcti, 2012 on a going concern basis.
A report on Corporate Governance as required under Clause 49 of the
listing agreement forms part of this annual report.
MANAGEMENT DISCUSSION AND ANALYSIS REPORT
Report on Management discussion and analysis as required under Clause
49(V) of the listing agreement forms part of this annual report.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS & OUTGO
Information in accordance with 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 and forming part of this Report for
the year ended 31st March, 2012 is given in Annexure I.
PARTICULARS OF EMPLOYEES
The details required to be given under Section 217(2A) of the Companies
Act, 1956, read with the Companies (Particulars of Employees) Rules,
1975, as amended are given in Annexure forming part of this report. In
terms of section 219 (1) (b) (iv) of the Act, the Report and Accounts
are being sent to the shareholders excluding the aforesaid Annexure.
Any shareholder interested in obtaining a copy of the same may write to
the Company Secretary.
In line with Management''s commitment to Safety, Occupational Health
System is successfully implemented at company''s chemical division by
integrating the same with the existing Quality Management System in
accordance with ISO 9001: 2008 and Environmental Management System in
accordance with ISO 14001:2004.
Company''s Resin Division applied for FICCI Quality Award 2011 with the
objective of benchmarking our quality initiatives and performance with
other leading organisations. Evaluation criteria for the award focus on
Commitment to Quality Systems at work place and its adoption for
effectiveness. The Quality processes of the company were appreciated by
FICCI, when they awarded ''Certificate of Appreciation'' after critical
evaluation of the ''Application Report'' and subsequent site visit to
the manufacturing facility.
Balanced Scorecard, the tool used for implementation of formulated
strategies is now internalized effectively.
All other initiatives such as Quality improvement projects to solve
chronic problems, monitoring of Quality Objectives, System Audits of
Marketing, Execution, Projects and O&M sites continue.
The Statutory Auditors. M/s. S. R. Batliboi & Co. hold office until the
conciusion of this meeting and are eligible for re-appointment. The
Company has received letter from M/s. S. R. Batliboi & Co.. to the
effect that their re-appointment, if made, would be within the limits
specified under section 224(1 B) of the Companies Act, 1956.
Your Board conveys its deep appreciation of the co-operation extended
by customers, suppliers, banks, financial institutions, contribution
made by employees for the company''s growth, shareholders and fixed
On behalf of the Board of Directors
Date : 25th May. 2012