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JJ Exporters

BSE: 530049|ISIN: INE408B01015|SECTOR: Textiles - Synthetic & Silk
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Directors Report Year End : Mar '15    « Mar 14
The Directors have pleasure in presenting the Forty Second Annual
 Report, together with the Audited Accounts of the Company for the year
 ended 31st March, 2015.
  
 FINANCIAL RESULTS
 
                                               2014-15          2013-14
 
 Profit before Tax, Depreciation and
 Extra Ordinary Items                          (123.38)        (1543.45)
 
 Less : Depreciation                            441.16           367.56
 
 Profit/(Loss) before Tax and extra 
 ordinary items                                (564.54)        (1911.01)
 
 Less : IT. for earlier year                       -                -
 
 Less : Prior Period Items                         056              079
 
 Profit/(Loss) before 
 Extra-Ordinary Items                          (565.10)        (1911.80)
 
 Extra Ordinary Items                           299.75          (400.00)
 
 Profit/(Loss) after Tax                       (265.35)        (2311.80)
 
 Add : Balance brought forward 
 from Previous year                           (4653.55)        (2341.75)
 
 Balance in Profit & Loss Account             (4918.90)        (4653.55)
 
 BUSINESS AND PERFORMANCE
 
 The performance of the Company during the year under review was a
 little better than the previous year. It was able to arrest the loss to
 some extent. As reported earlier the units at Bangalore were closed
 during the previous year. The unit at Kolkata viz. J. J. Spectrum Silk
 which was temporarily closed during the previous year w.e.f. 01.12.2013
 continued to be under temporary closure during the current year.
 However the unit at Bhagalpur remained operational. The sale revenue
 for the year was down at Rs.1665.99 lacs as compared to Rs.3288.35 lacs
 in the previous year. The loss before tax and extra-ordinary item was
 down at Rs.565.10 lacs as compared to Rs.1911.80 lacs during the
 previous year.
 
 CURRENT YEAR''S OUTLOOK
 
 At this instance the outlook of the silk market globally for the
 current year does not look any different than the one during the year
 under review. Taking this into account, your directors have decided
 after due market research to add additional streams of revenue apart
 from the core business of the Company, which includes export of linen
 and polyester fabrics, which would not require additional
 infrastructure but shall add to the top line of the company.
 
 In order to improve the working of the Company and generate more
 business your directors have decided to strengthen the design
 department, which shall be for the existing core business of silk along
 with linen and polyester fabrics. It has also been decided to actively
 participate in more trade fairs and revive contacts with our old
 customers. Your directors have also decided to control expenditure
 wherever possible. With all these measures your directors are hopeful
 of improvement in the current year.
 
 SETTLEMENT OF DUES OF THE BANKS
 
 In view of the poor performance of the Company, your Directors had
 approached its bankers for settlement of their dues. The Federal Bank
 Ltd. had approved the settlement during the year. The amount settled
 with The Federal Bank Ltd has since been paid. The settlement with IDBI
 Bank Ltd has also been reached and the initial payment of Rs.500 lacs
 required to be paid in terms of their sanction letter has also been
 made by the Company. However, the Company has approached IDBI Bank for
 extension of the dates for payment of balance amount of settlement.
 Final negotiation with Indian Overseas Bank has also been had at Branch
 level and accordingly the Company has revised its offer for the OTS.
 Your Directors are confident of getting the same approved by the final
 authorities of the Bank.
 
 Your Directors are trying to sell Company''s building at Bangalore and
 also the unit at Gangarampur to pay off the banks.
 
 SHARE CAPITAL
 
 The Company has not issued any shares with differential voting rights,
 sweat equity shares or employee stock option during the year under
 review. The Company has also not made any provision for purchase of its
 own shares by employees or trustees for the benefit of employees.
 
 DIRECTORS
 
 Mr. M. L Gulrajani resigned from the Board of the Company during the
 year w.e.f. 22.05.2014. Ms. Puja Jhunjhunwala & Ms. Dipali Sharma were
 appointed as Additional Directors during the year by the Board on
 27.03.2015. Ms. Puja Jhunjhunwala and Ms. Dipali Sharma will hold
 office till the conclusion of the forthcoming Annual General Meeting.
 Notices from members of the Company have been received proposing them
 as regular Directors of the Company.  Ms. Puja Jhunjhunwala & Ms.
 Dipali Sharma are accordingly proposed to be appointed as Independent
 Directors at the ensuing Annual General Meeting.
 
 Mr. P. K. Sarkar, an Independent Director on the Board of the Company
 died on 16.07.2015 The Board places its appreciation on record for the
 valuable services it received from Mr. Sarkar during his association
 with the Company.
 
 Necessary declaration as required under section 149(7) of the Companies
 Act, 2013 confirming that they meet the criteria of Independence and
 are eligible to continue as Independent Director has been received from
 Mr. Rahul Singhi and Mr. H. S. Senapati, the Independent Directors on
 the Board and from Ms. Puja Jhunjhunwala and Ms. Dipali Sharma proposed
 to be appointed as Independent Directors at the ensuing Annual General
 Meeting.
 
 Mr. S. N. Jhunjhunwala, Director, retires by rotation and being
 eligible has offered himself for re-appointment at the ensuing Annual
 General Meeting. Mr. A. B. Chaturvedi, Director was additionally
 appointed as CFO of the Company during the year.
 
 A meeting of Independent Directors was held during the year where
 performance of non-independent Directors was evaluated.  The
 performance of Independent Directors was evaluated by the Board. The
 performance of an individual director is evaluated based on the
 performance of the department/unit of which he is the functional head.
 The performance of the Board as a whole or its committee is evaluated
 based on the performance of the Company.
 
 Details about the nos. of Board meeting held during the year, the
 composition of Audit Committee and the number of times it met during
 the year are disclosed in the Corporate Governance Report which forms a
 part of this report.
 
 VIGIL MECHANISM AND WHISTLE BLOWER POLICY FOR DIRECTORS AND EMPLOYEES
 
 The Company has framed vigil mechanism and whistle blower policy for
 Directors and employees to report genuine concern The details are
 available on Company''s website, www.jjexporters.com.
 
 PARTICULARS OF CONTRACTOR OR ARRANGEMENTS WITH RELATED PARTIES
 
 All the contracts and arrangements entered into with related parties
 during the year were at arm''s length basis. Details of the same are
 given in Form OAC-2 and is annexed to the report.
 
 SECRETARIAL AUDIT REPORT
 
 Secretarial Audit Report given by M/s. MR & Associates, Company
 Secretaries in practice, is annexed to the report.
 
 RISK MANAGEMENT POLICY
 
 Details of Risk Management Policy are given in Corporate Governance
 Report and forms a part of this report.
 
 EXTRACT OF THE ANNUAL RETURN
 
 The extract of the annual return in Form No.MGT-9 is annexed to the
 report and forms a part of the Board''s report
 
 NOMINATION AND REMUNERATION COMMITTEE
 
 The Remuneration Committee of Board of Directors was renamed as
 Nomination and Remuneration Committee during the year.  The Committee
 identifies and recommends suitable candidates as Members of Board, Key
 managerial personnel and other Senior Management. The remuneration
 policy of the Company aims to ensure fair remuneration for the
 employees based on their performance. It also ensures to eliminate
 discrimination while fixing the remuneration of various employees.
 
 OVERSEAS SUBSIDIARIES AND JOINT VENTURE
 
 Your Directors have disposed of its investment in the subsidiary viz.
 J. J. Creations at Belgium during the year. As such, the said J. J.
 Creations has ceased to be a subsidiary of the Company.
 
 The performance of the other subsidiary viz. Spin International Inc.
 was, by and large, satisfactory during the year.
 
 RETAIL SHOWROOM
 
 The performance of Company''s retail showroom ''ONSET at Kolkata was by
 and large satisfactory during the year.
 
 DIVIDEND
 
 Owing to loss, your Directors do not recommend any dividend for the
 year.
 
 DIRECTORS RESPONSIBILITY STATEMENT
 
 As required under section 134(3) (c) of the Companies Act, 2013, your
 Directors confirm that
 
 (a) in the preparation of the annual accounts, the applicable
 accounting standards had been followed along with proper explanation
 relating to material departures;
 
 (b) the directors had selected such accounting policies and applied
 them consistently and made judgments and estimates that are 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 loss of the
 Company for that period;
 
 (c) the directors had taken proper and sufficient care for the
 maintenance of adequate accounting records in accordance with the
 provisions of this Act for safeguarding the assets of the Company and
 for preventing and detecting fraud and other irregularities;
 
 (d) the directors had prepared the annual accounts on a going concern
 basis;
 
 (e) the directors, had laid down internal financial controls to be
 followed by the Company and that such internal financial controls are
 adequate and were operating effectively.
 
 (f) the directors had devised proper systems to ensure compliance with
 the provisions of all applicable laws and that such systems were
 adequate and operating effectively.
 
 CORPORATE GOVERNANCE
 
 Your Company has consistently been complying with the Corporate
 Governance Code prescribed by SEBI and a detailed report on Corporate
 Governance together with a Certificate of Compliance from the Statutory
 Auditors, as required by Clause 49 of the Listing Agreement, forms a
 part of this Annual Report.
 
 AUDITORS
 
 M/s. Salarpuria Jajodia & Co., Chartered Accountants, Kolkata, bearing
 Registration No.302111E, were appointed as auditors of the Company for
 three years at the 41st Annual General Meeting held on 29.09.2014, to
 hold office till the conclusion of the 44th Annual General Meeting to
 be held in the year 2017. However, a certificate has been obtained from
 them that their appointment is within the limits prescribed by the Act
 and they continue to meet the criteria specified u/s.141 of the
 Companies Act, 2013.
 
 The remark in Auditors Report read with notes to Accounts are
 self-explanatory and need no further clarification.
 
 CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
 EARNING AND OUTGO
 
 A) Conservation of energy and technology absorption :
 
 The Company had closed its unit at Bangalore w.e.f. 01.04.2013. The
 unit at Gangarampur continued to be under temporary closure during the
 year.
 
 The particulars in respect of conservation of energy and technology
 absorption in respect of Bhagalpur Unit are given in Annexure ''A
 forming part of this report pursuant to Section 134(3)(m) of Companies
 Act, 2013 and rules made thereunder,
 
 B) Foreign Exchange earnings and outgo :
 
 The information is contained in Item No.16 of Note No. ''23'' in notes to
 the accounts.
 
 INVESTMENTS
 
 The details of investments are given in Note No. ''8'' annexed to the
 annual accounts of the Company.
 
 SUBSIDIARY COMPANIES
 
 The particulars, as required under Section 134 of the Companies Act,
 2013 and Rules made thereunder, in respect of Company''s subsidiaries
 viz. Spin International INC. and J. J. Creations S.A are as follows :
 
 I.  Financial Performance    A. Spin International    B.  J J Creations
                                    (Amount in USD)     (Amount in Euro)
                                      (For the year      (For the period
                                    ended 31.03.15)      ended 30.09.14)
 
 Sales                                    1,297,095                  295
 
 Cost of goods                            1,042,935                1,639
 
 Gross Profit                               254,160               (1,344)
 
 Overheads                                  304,539                   82
 
 Income from operation                      (50,379)               (1426)
 
 Other Income                                17,769                   -
 
 Income before tax                          (32,610)               (1426)
 
 Income Tax                                   3,255                   -
 
 Net Income                                 (35,865)               (1426)
 
 
 II.  Financial position as on 31.03.2015
 
 Current liabilities                         40,950
 
 Capital                                      1,000
 
 Reserve & Surplus                          785,188
 
 Total Liability                            827,138
 
 Current Assets                             764,728
 
 Fixed Assets                                 3,685
 
 Investments                                 58,725
 
 Total Assets                               827,138
 
 In respect of J J Creations, details of Balance Sheet are not given as
 it ceased to be a subsidiary of the Company during the year.
 
 FIXED DEPOSITS
 
 The Company has not accepted any Fixed Deposits during the year. No
 deposits were outstanding at the beginning of the year.
 
 MANAGERIAL REMUNERATION
 
 i) The ratio of remuneration paid to each Director during the year to
 the median remuneration of the employees of the Company
 
 A.  Executive Directors
 
 Name of the Director             Remuneration              Ratio
 
 Mr. S. N. Jhunjhunwala             Rs. 739200               6.08
 
 Mr. Rajiv Jhunjhunwala             Rs. 672000               5.53
 
 Mr. A. B. Chaturvedi               Rs. 836420               6.90
 
 B.  The Non-Executive Directors receive remuneration by way of sitting
 fees for attending Board and Committee Meetings. Such remuneration to
 each of the Non-Executive Directors for the financial year was lower
 than the median remuneration of employees for the year.
 
 ii) Percentage increased in the remuneration of each Directors & Key
 Managerial Personnel
 
 Percentage increased
 
 Mr. S. N. Jhunjhunwala, Executive Chairman & CEO    (40.00%)
 
 Mr. Rajiv Jhunjhunwala, Vice Chairman               (40.00%)
 
 Mr. A. B. Chaturvedi, Whole Time Director & CFO       4.50%
 
 Mr. S. L. Agrawal, Company Secretary                  4.70%
 
 i) Percentage increased in the median remuneration of employees during
 the year : NIL
 
 ii) No. of permanent employees on the Roll as on 31.03.2015 292 (Two
 hundred ninety two)
 
 iii) Market capitalization as on     31.03.2014         Rs. 957.72 lacs
 
                                      31.03.2015         Rs. 635.39 lacs
 
                                      Variation         (Rs. 322.33 lacs)
 
 iv) Price at which the last 
 Public offer was made                                Rs. 70/- per share
 
 v) Percentage increase/decrease 
 in market quotation of the 
 shares of the Company in 
 comparison to the price at 
 which the last public offer
 was made                                                         -90.20%
 
 vi) Variation in the net worth 
 of the Company as at close
 of current financial year and 
 previous financial year.                              Rs. (265.30) lacs
 
 vii) Ratio of the remuneration 
 of the highest paid Director 
 to that of the employees who are 
 not Directors but received 
 remuneration in excess
 of its highest paid Director
 Remuneration of highest paid 
 Director  (Mr. A. B. Chaturvedi)                          Rs. 8.36 lacs
 Remuneration to employees who 
 are not Directors but received
 remuneration In excess of 
 its highest paid Director :
 
 i) Mr. S. L Agrawal, Co. Secretary                        Rs.13.32 lacs
 
 ii) Mr. N. K. Sharma, General 
 Manager (BLR)                                             Rs.10.92 lacs
 
 Total                                                    Rs. 24.24 lacs
 
                                          Ratio : 8.36 : 24.24 i.e. 0.34
 
 It is hereby affirmed that the remuneration is as per the remuneration
 policy of the Company.
 
 Other particulars as required under clause (v) to (ix) of Rule 5(1) of
 Companies (Apt & Rumination of Managerial Personnel) Rules, 2014 are
 not applicable to the Company.
 
 ACKNOWLEDGEMENTS
 
 Your Directors place on record their deep appreciation for the
 continued assistance and co-operation extended to the Company by its
 customers, investors, bankers, government agencies and its dedicated
 band of employees.
 
                                                By Order of the Board
 
 Registered Office:
 
 59, Elliot Road                                   S. N. Jhunjhunwala
 
 Kolkata - 700 016                                 Executive Chairman
 
 Dated : 31st July, 2015                              (DIN : 0006345)
Source : Dion Global Solutions Limited
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