The Members
MMTC Limited, New Delhi.
Ladies & Gentlemen,
On behalf of Board of Directors, I have pleasure in presenting 48th
Annual Report on the performance of your company for the financial year
ended 31st March 2011 along with audited statements of accounts,
Auditor''s Report & Review of Accounts by the Comptroller and Auditor
General of India.
RESULTS OF OPERATIONS
Your Company recorded its highest ever topline consecutively for the
seventh year. Your company achieved record level business turnover of
Rs. 688,545 million during 2010-11 registering a growth of over 53%
over the previous year. This best ever business turnover since MMTC''s
inception in 1963 includes Exports of Rs. 36,934 million, highest ever
Imports of Rs. 633,008 million and domestic trade of Rs. 18,603
million. The other trade related earnings contributed Rs. 2,015
million. The trading profit earned by your Company stood at Rs. 3,300
million as against Rs 3,176 million during last year. The net profit
earned by your company during 2010-11 amounted to Rs. 1,216 million
The highlights of the Company''s performance during 2010-11 are as
below: -
(Rs. in million)
2009-10 2010-11
Exports 32,228 36,934
Imports 399,690 633,008
Domestic 19,324 18,603
Other trade earnings 1,397 2,015
Net Sales/ Trading Earnings 452,639 690,560
Trading profit 3,176 3,300
Profit Before Taxes 3,331 1,918
Profit after Taxes 2,162 1,216
Dividend
(i) Proposed Dividend 450 250
(ii) Dividend Tax 75 41
Reserves and Surplus 12,371 12,797
The performance of different business groups of your Company is
highlighted in the Management Discussions and Analysis Report, which is
annexed and forms part of this Report.
AWARDS & RANKINGS
Following Awards and Rankings were conferred on your Company during
2010-11:
- CAPEXIL’s award for Highest Export in Minerals and Ores Sector for
the year 2009-10(19th time in a row).
- “Top Exporters for the year 2008-09,Gold Trophy(Merchant Exporter)”
by EEPC(Northern Region).
- Dun & Bradstreet (D&B) and Rolta Corporate Award 2010 in Trading
Sector.
- Ranked 4th by Business Today in their publication “BT 500 - 2010
Public Sector Companies” .
- Ranked 8th by Dun & Bradstreet in their publications “India’s Top 500
Companies 2010” and “India’s Top PSUs 2011”
- Ranked 11th by Business Standard in their publication “BS1000”
released in March 2011.
EQUITY SHARE CAPITAL & DIVIDEND
During the year under report equity shares of your company of face
value Rs.10/- each were sub- divided into ten shares of face value
Re.1/- each. Also, Bonus Shares in the ratio of 1:1 were issued on 5th
August 2010. This resulted in increase of the equity capital of your
company from Rs.500 million comprising of 50 million shares of Rs.10/-
each to Rs.1000 million comprising of 1000 million shares of Re.1/-
each. The Board of Directors recommends declaration of dividend of 25%
on the enhanced post Bonus equity capital of the Company for the year
2010-11.
RESERVES
A sum of Rs. 12,371.47 million was available in the reserves and
surplus of your Company as on 1st April 2010. During the year 2010-11
an amount of Rs. 500 million was withdrawn from the reserves for
issuance of bonus shares in the ratio of 1:1. Your Directors have
proposed that out of Rs.925.88 million available out of the profits for
the year 2010-11, after payment of dividend and tax thereon, an amount
of Rs.130 million be transferred to General Reserves of the Company and
balance profit of Rs.795.88 million be carried forward as retained
profits. Accordingly an amount of Rs.12,797.35 million shall be
available in Reserves and Surplus of your Company as on 31st March
2011.
SUBSIDIARY COMPANY
The wholly owned subsidiary of your Company - MMTC Transnational Pte.
Ltd. Singapore (MTPL) was incorporated in October 1994 under the laws
of Singapore with a share capital of USD 1 million. During the year
2010-11, MTPL achieved its best business turnover of USD 710 million,
since its inception. The Profit after tax earned by MTPL during
2010-11 amounted to USD 2.32 million. The net worth of MTPL stood at
USD 18.23 million as on 31st March 2011. MTPL has so far paid total
dividends of US$ 8.27 million as against capital of US$ 1 million
contributed by your company besides multiplying its net worth by over
18 times since its inception.
MTPL continues to enjoy prestigious Global Trader (GT) status awarded
to it by International Enterprise Singapore since FY 2000.
Pursuant to the provisions of Section 212 of the Companies Act, 1956,
the audited financial statements of MTPL together with Director''s
Report & Auditor''s report are attached herewith.
MMTC''S PROMOTED PROJECT-Neelachal Ispat Nigam Ltd. (NINL)
Your company had set up Neelachal Ispat Nigam Limited (NINL) - an iron
& steel plant of 1.1 million tonnes capacity, 0.8 million tonne coke
oven and by product unit with captive power plant, jointly with Govt.
of Orissa. The project has firm Iron ore supply linkages and also has
captive Iron ore mining rights for reserves estimated at about 150
million tons. The construction of phase-II of the Project (Steel making
facilities) with an estimated cost of Rs.18,550 million is in advance
stages & is likely to commence trial production by end of current
financial year. During the year 2010-11, NINL achieved a sales turnover
of Rs.16,158 million which includes export of 405,900 tonnes of pig
iron worth Rs. 8,237 million, domestic sales of 114,491 tonnes of pig
iron valued at Rs 2,553 million and 156,277 tonnes of BF coke valued at
Rs. 2,814 million.
Future Projects/ Joint Ventures
Aiming at diversification and with a view to add value to its existing
trading operations, your Company has participated in various joint
ventures under public- private partnership route. These value
multiplier initiatives to enhance your company’s future sustainability
are briefed hereunder:
(i) Your company has promoted a Commodity Exchange under the name and
style of Indian Commodity Exchange Limited which has since commenced
operations in November 2009.
(ii) Your company is participating in the equity of a Currency Futures
Exchange under the name and style of United Stock Exchange of India
Ltd. which has commenced operations in September 2010.
(iii) Your company has joined hands with an international producer as a
joint venture partner for setting up a gold/silver medallion
manufacturing unit, which would also include a gold refinery as an
integral part, under the name and style of MMTC-Pamp India Private
Limited. The civil construction activities for medallion manufacturing
unit in Haryana have already been completed and the medallion
manufacturing unit commenced trial production in February 2011. The
said medallion manufacturing unit has since commenced commercial
production in April 2011.
(iv) For effective marketing of the finished products from above unit,
as well as jewellery from other sources, your company is setting up, in
partnership with a leading Indian company, a chain of retail stores at
various cities in India for medallions, jewellery and its homegrown
brand of ''SANCHI'' silverware. Towards this end a special purpose
vehicle (SPV) under the name and style of MMTC-Gitanjali Private
Limited has been incorporated and 17 retail outlets have already been
opened in various cities/ towns in India.
(v) Your company has set up a permanent berth with loading facilities
for iron ore at Ennore Port jointly with SICAL and L&T Infrastructure
Ltd. under the name and style of M/s. SICAL Iron Ore Terminals Limited.
The berth is operationally ready since October 2010 but due to ban on
exports of iron ore by Karnataka State Govt. the terminal has not been
formally commissioned as yet. Once exports resume, the terminal will
provide an important outlet for such exports.
(vi) Your company is also developing a deep draught iron ore loading
berth at Paradeep Port (Orissa) jointly with Noble Group Ltd. and
Gammon Infrastructure Projects Ltd. under the name and style of M/s.
Blue Water Iron Ore Terminal Private Ltd. The project is in the initial
phase and is expected to commence construction by end of the current
calendar year after forest clearance has been received from the
authorities concerned.
(vii) Towards investing in mining exploration your Company has set up a
joint venture company with M/s. TATA Steel Ltd. under the name and
style of TM Mining Ltd. for exploration and development of mines for
minerals, ferrous and non-ferrous ores, precious metals, diamonds and
coal etc., both in India and abroad.
(viii) To facilitate promotion of two-way trade, the SPV promoted by
your Company in association with IL&FS has been allotted land to set up
free trade and warehousing zones at Haldia and Kandla on lines similar
to Special Economic Zones. To facilitate the same, process to induct
strategic partner in the projects has been initiated.
(ix) Your company has been allotted a coal mine in the Jharkhand State
having estimated reserves of about 700 million MT. Prospecting license
for the same has since been issued by the concerned authorities and the
pre-feasibility study completed. Actions for further exploration of the
coal block for preparing geological report /mining plans has since been
initiated.
INDUSTRIAL RELATIONS & HUMAN RESOURCE MANAGEMENT
Cordial and harmonious industrial relations continued to prevail in
your company with no man-days being lost during the year. Regular
meetings were held with the Unions / Associations for arriving at
amicable resolution of personnel issues with a view to achieve
Company’s goals and objectives.
The aggregate manpower of the company as on 31st March 2011 stood at
1,767, including five Board level executives, the balance comprising of
584 Officers, 1094 staff and 84 workers. This includes 20 officers, 126
staff & 84 workers of erstwhile Mica Trading Company Ltd., which had
been merged with your company pursuant to the orders of BIFR. While the
composite representation of the total manpower consisted of women
employees representing 18.68% (330 employees) of the total manpower,
the representation of SC, ST, OBC & persons with disabilities (PWD) was
to the extent of 21% (371 employees), 7.53% (133 employees), 1.75% (31
employees) and 1.87% (33 employees) respectively. During the year 21
officers were inducted through campus recruitment. Presidential
Directives on reservations for SCs, STs, OBCs and PWD in services were
followed fully in recruitment and promotion.
Aiming towards further enhancing / upgrading the skills of employees in
the constantly changing business scenario 1,251 employees were imparted
training during the year in different spheres of company’s activities.
This was done through programmes organized both with in-house expertise
as well as external resources from renowned institutions /
organizations. The employees deputed for training included 182
employees belonging to SC, 81 to ST and 313 women employees. In terms
of man-days such training works out to 2,197 training man-days during
the year 2010-11.
IMPLEMENTATION OF OFFICIAL LANGUAGE
Your Company is committed to uphold Official Language Policy of the
Government. During the year 2010-11, your company consistently strived
to adhere and implement the Official Language Policy and meet the
targets given in the annual programme issued by the Department of
Official Language, Ministry of Home Affairs, govt. of India. Towards
this and to promote usage of the Official Language by employees of the
company, several programs in the form of Hindi Workshops, Hindi Week/
Fortnight were organized at the Corporate Office and Regional Offices.
During the year the Company had the privilege of interacting with the
Drafting and Evidence Sub- Committee of the Committee of Parliamentary
on Official Languages when it inspected SRO Cochin of your company.
VIGILANCE
To enhance the goodwill & confidence emanating from value based
business practices, the Vigilance group of your company carried further
its focus on system improvement and preventive vigilance. An annual
calendar of vigilance inspections was prepared by the group well in
advance to ensure systematic and regular vigilance inspections. During
the year regular inspections were conducted by vigilance &
non-vigilance officers and based on the feedback received, corrective/
preventive measures were suggested. Special emphasis was also laid on
updation of trade related drills/ manuals, streamlining of tendering
and other procedures in line with the guidelines issued by Central
Vigilance Commission
During the year under report Vigilance group of your Company was also
instrumental in organizing “Vigilance Awareness Week” in various
offices of MMTC in November 2010 whereat stress was laid upon
increasing vigilance awareness amongst employees and business
associates, to bring enhanced transparency in public dealings.
CORPORATE SOCIAL RESPONSIBILITY
Your Company has been a responsible corporate citizen since its
inception in 1963, responding through resources and manpower in times
of need. Corporate Social Responsibility was adopted as a Corporate
Policy in the year 2006-07 with specific guidelines. The focus being
education, health care, promotion of art & culture and community
activities including relief in times of natural calamities. The CSR
Policy was subsequently aligned to the CSR Guidelines laid down by the
Department of Public Enterprises in 2009-10. Your company’s CSR focus
during 2010-11 was on building educational infrastructure for deprived
sections of society and tsunami affected areas, literacy promotion,
facilitating computer education and creating drinking water & health
care facilities. In addition, your company also contributed towards the
promotions of sports, art & culture. During this period sustainable
development initiatives like afforestation at Bellary (Karnataka) and
Jajpur & Baril (Odisha) by planting saplings and construction of two
check dams to facilitate irrigation in Jajpur District (Odisha) were
also undertaken. A total of Rs. 36.15 million was spent on these
initiatives during the year.
CORPORATE GOVERNANCE
Corporate governance is an area of major significance not only to
governments and business but to all who are affected by organizations
in some way, whether as investors, directors, employees, suppliers,
customers or the community in general. Your Company reposes its firm
faith in continuous development, adoption and dedication towards the
best corporate governance practices.
A separate report on corporate governance along with Statutory Auditor
certificate regarding compliance of the stipulations relating to
corporate governance specified in clause 49 of the listing agreement(s)
signed with stock exchanges is annexed to and forms part of this
report.
CODE OF CONDUCT
Pursuant to Clause 49 (I)(D) of the Listing Agreement signed with Stock
Exchanges, a detailed Code of Conduct for Board Members and Senior
Management Personnel has been laid down and hosted on the website of
your company. All Board Members and Senior Management Personnel (except
one) on the regular rolls of the company as on 31st March 2010, to whom
the said Code is applicable have affirmed compliance of the same for
the period ended 31st March 2011. Action against the one defaulting
General Manager (under suspension) is in progress.
PUBLIC DEPOSIT SCHEME
As on 1st April 2010, there were no outstanding public deposits and the
company did not invite/ accept any public deposit during the year ended
31st March 2011.
STATUTORY AUDITOR’S REPORT
The Statutory Auditors have not given any comments having an impact on
the profit for the year 2010- 11. Applicable disclosures have been made
in the ‘notes forming part of accounts’ in respect of other
observations contained in the report of statutory Auditors, as annexed,
which have no financial impact on the profit for the year 2010-11.
COMMENTS OF COMPTROLLER & AUDITOR GENERAL OF INDIA
The Comptroller & Auditor General of India(C&AG) has given ‘Nil’
comments under section 619(4) of the Companies Act, 1956 on the
accounts of the Company for the year ended 31.03.2011.The communication
dated 17th August 2011 of C & AG in this regard is annexed herewith.
CONSERVATION OF ENERGY
During the year 2010-11, there was no activity in Mica group of your
company. Pursuant to Section 217(i)(e) of the Companies Act, 1956, a
statement on conservation of energy is annexed to this report.
PARTICULARS OF EMPLOYEES
Pursuant to provisions of section 217(2A) of the Companies Act, 1956
read with the Companies (Particulars of Employees) Rules, 1975, as
amended from time to time, it is stated that there were no employees
who were in receipt of remuneration exceeding Rs.60 lakhs per annum or
Rs. 5.00 lakhs per month during the year 2010-11.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to the provisions of Section 217(2AA) of the Companies Act,
1956, your Directors state:
i) That in the preparation of the annual accounts, the applicable
accounting standards have been followed along with proper explanation
relating to material departures;
ii) That 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 the
profit of the Company for the year ended 31.3.2011;
iii) That the Directors have taken a proper and sufficient care for the
maintenance of the adequate accounting records in accordance with the
provisions of Companies Act, 1956 for safeguarding the assets of the
Company and for preventing and detecting fraud and other
irregularities;
iv) That the Directors have prepared the annual accounts on a going
concern basis.
BOARD OF DIRECTORS
Following are the changes in the Board of Directors of your company
since 1st April 2010:- - Shri S K Kar relinquished the charge of Whole
Time Director (Finance) on 30th June 2010 on superannuation.
- Shri A Mahapatra relinquished the charge of Whole Time Director
(Personnel) on 30th July 2010 on superannuation.
- Shri Sanjiv Batra relinquished the charge of Chairman & Managing
Director on 30th September 2010 on superannuation.
- Shri H S Mann, Director (Marketing) assumed the additional charge of
CMD w.e.f. 6th October, 2010 until 22nd July 2011
- Dr S Behuria, relinquished the charge of part-time Director on the
Board of MMTC and Shri Saurabh Chandra AS&FA, DIP&P & Department of
Commerce, Ministry of Commerce & Industry took over as part time
Director on the Board of MMTC vice Dr S Behuria w.e.f. 6th October
2010.
- Shri Saurabh Chandra, relinquished the charge of part-time Director
on the Board of MMTC and Dr. Rajan Katoch, AS& FA, Department of
Commerce, Ministry of Commerce & Industry took over as part time
Director on the Board of MMTC vice Shri Saurabh Chandra w.e.f.7th
December 2010.
- Shri Rajeev Jaideva took over the charge of Whole Time Director
(Personnel) on the Board of MMTC w.e.f. 3rd December 2010.
- Shri Anil Razdan took over the charge of Part Time Non-official
(Independent) Director on the Board of MMTC w.e.f. 13th July 2011.
- Shri S Krishnan took over the charge of Part Time Non-official
(Independent) Director on the Board of MMTC w.e.f. 14th July 2011.
- Shri G S Vedi took over the charge of Part Time Non-official
(Independent) Director on the Board of MMTC w.e.f. 14th July 2011.
- Shri Arun Balakrishnan took over the charge of Part Time Non-official
(Independent) Director on the Board of MMTC w.e.f. 16th July 2011.
- Shri H S Mann relinquished the charge of Director(Marketing) &
additional charge of Chairman & Managing Director on 22nd July 2011.
- Smt Vijaylaxmi Joshi, Additional Secretary, Department of Commerce,
MOC&I assumed the additional charge of Chairman-cum-Managing Director
w.e.f. 22nd July 2011 vice Shri H S Mann.
The Board places on record its deep appreciation for the commendable
services and the contributions made by Dr S Behuria, Shri Saurabh
Chandra, Shri Sanjiv Batra, Shri S K Kar, Shri A Mahapatra and Shri H S
Mann towards effective discharge of the functions of the Board and its
Committees. The Board also welcomes Smt Vijaylaxmi Joshi, Dr. Rajan
Katoch, Shri Rajeev Jaideva, Shri Anil Razdan, Shri S Krishnan, Shri G
S Vedi & Shri Arun Balakrishnan and expresses confidence that the
Company shall immensely benefit from their rich and varied experience.
In terms of provisions of Article 87(4)(A) of Articles of Association
of the Company regarding rotational retirement of Directors, Smt Aruna
Makhan, Non Official Part time Director, Shri P K Chaudhery, Govt
Nominee Part time Director, Shri Ved Prakash, Director (Marketing) and
Shri Anil Baijal, Non Official Part time Director, shall retire at the
AGM and being eligible have offered themselves for reappointment.
ACKNOWLEDGEMENTS
Your Directors would like to acknowledge and place on record their
sincere appreciation of all stakeholders- shareholders, Department of
Commerce, all Govt. Agencies, RBI and other Banks, Railways, Customs,
Ports, NMDC, Customers, Suppliers and other business partners for the
excellent support and cooperation received from them during the year.
Your Directors also recognize and appreciate the efforts and hard work
of all the employees of the Company and their continued contribution to
its progress.
By the Order of the Board
Sd/-
Place : New Delhi (Vijaylaxmi Joshi)
Dated : 18.08.2011 Chairman-cum-Managing Director
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