To, The Members of Refnol Resins and Chemicals Limited Mumbai.
The Directors present their 31st Annual Report together with the
Audited Statement of Accounts of Company for the year ended 31st March
1) FINANCIAL RESULTS:
The financial results of the Company for the year under review are as
(Rs. in lacs)
Particulars 2011-12 2010-11
Profit/(Loss) before Financial
Costs and Depreciation (62.24) 126.20
Less:- Interest & Financial Charges 145.60 106.61
Less:- Depreciation 15.41 15.26
Profit/(Loss) Before Tax (223.25) 4.33
Tax Expenses 0.00 2.75
Short Provision of Tax in
respect of earlier years (0.43) -
Net Profit/(Loss) After Tax (223.68) 1.58
Profit available for Appropriation (223.68) 1.58
Despite continuous efforts to maintain and increase turnover and
profitability, there was a sharp decline in sale by 21.70% from Rs.
2410.31 lacs to Rs. 1887.34 lacs. Exports decreased by 13.31% from Rs
752.17 lacs to Rs 652.07. The decline in turnover was largely due to
reduction in the composite and coating resin businesses of the company
both in domestic and export markets and sharply reduced profitability
in these business due to rapid increase in raw material prices during
the year, fuelled by increase in petroleum product prices. It was not
possible in the short-run to increase business in the textile and
garment chemicals area to compensate.
There was also a steep increase in interest and financial charges which
went up by 36.57% as compared to the previous year.
Due to the combination of above factors the operations have resulted in
a loss of Rs. 223.68 lacs for the last financial year.
3) MARKETING AND EXPORTS:
The textile and garment industry both in India and worldwide are in the
grip of a sharp down turn in demand. To counter this, strenuous efforts
have been made by the company to widen its customer base and strengthen
its presence in new markets at home and abroad.
The company will continue its efforts to increase the sales in both
export and domestic market in this year and is making every effort to
increase business in the high value added products in the various
The company strives its best to market its products in India and abroad
and enjoys the loyalty of a large group of customers for its various
products. While maintaining the polyester resin business, extra efforts
are being put in to increase the sales of textile chemicals, laundry
and garment processing chemicals with a view to restore and increase
The operations of the company have in fact improved significantly over
the few months since the end of the last financial year and we expect
the positive trend to continue.
In view of the accumulated losses, your Directors have not recommended
any dividend for the year under review.
Your Company has not accepted any public deposit within the meaning of
the provisions of Section 58A of the Companies Act, 1956.
The Board of Directors of your company has various executive and
non-executive directors including independent directors who have wide
and varied experience in different disciplines of corporate
functioning. Mr. Mahendra Khatau, Director of the company, retires by
rotation at the forthcoming Annual General Meeting and being eligible,
offers himself for re- appointment.
All the insurable assets of the company including Plant & machinery,
Buildings and Inventories are adequately insured.
8) SUBSIDIARY COMPANY:
Pursuant to the requirements of Section 212 of the Companies Act, 1956
the Annual Accounts of the Company''s subsidiary viz., Refnol Overseas
Limited for the period ended 31st March 2012 is annexed together with
the statement showing the extent of the Company''s interest therein.
9) MANAGEMENT DISCUSSIONS AND ANALYSIS REPORT:
Your company manufactures textile sizing chemicals and auxiliaries,
garment wash and laundry chemicals and polyester resins at Plot No. 23,
G.I.D.C., Naroda, Ahmedabad, Gujarat. The company caters to both the
domestic and international markets. The product range finds application
in textile industry, garment processing industry and composites
industry. The company has a marketing and distribution network for
these chemicals with full technical service break-up. Rapid growth is
expected in both the textile chemical and garment chemicals business
and steps are being taken to strengthen and deeper the distribution and
sales network of the Company.
10) CORPORATE GOVERNANCE:
Your company has taken adequate measures to ensure that the provision
of corporate Governance as prescribed under clause 49 of the listing
agreement with stock exchanges are complied with. A detailed report as
per Appendix ''I'' on corporate governance, along with auditors''
certificate on its Compliance by the Company, forms part of this
11) DIRECTORS'' RESPONSIBILITY STATEMENT:
It is hereby confirmed:
1. That in the preparation of the Accounts for the financial year
ended 31st March 2012; the applicable accounting standards have been
followed along with proper explanation relating to material departures.
2. That the Directors have selected such accounting policies and
applied them consistently and made judgments and estimates that were
reasonable and prudent so as to give true and fair view of the state of
affairs of the Company at the end of the financial year and of the
Profit or loss of the Company for the year under review.
3. That 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
the Company and for preventing and detecting fraud and other
4. That the Directors have prepared the annual accounts on a going
Relations between the employees and the management continued to be
cordial during the period under review. The Directors hereby place on
record their appreciation for the efficient services rendered by the
company''s employees at all levels.
The Company has not paid any remuneration attracting the provisions of
Companies (Particulars of Employees) Rules, 1975 read with Section
217(2A) of the Companies Act, 1956. Hence, no information is required
to be appended to this report in this regard.
13) CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
EARNINGS AND OUTGO:
Statement giving Particulars with respect to conservation of energy,
technology absorption, foreign exchange earnings and out-go, in terms
of Section 217 (1) (e) of the Companies Act, 1956 read with Companies
(Disclosure of Particulars) Rules, 1988 is given in Appendix ''II''
forming part of this Report.
Your company''s shares are listed with The Stock Exchange, Mumbai,
Phiroze Jeejeebhoy Towers, Dalal Street, Fort, Mumbai. (Stock Code: -
530815). The Company has already paid Annual Listing fees of The Stock
Exchange, Mumbai for the ensuing financial year.
15) AUDITORS AND AUDITORS'' REPORT:
The present Auditors of the Company M/s. G. P Kapadia & Co., Chartered
Accountants, retires at the ensuing Annual General Meeting and being
eligible, offers themselves for reappointment.
The Auditors Report and the notes to the Accounts being
self-explanatory, no further explanation is required.
16) COMPLIANCE REPORT:
In accordance with Section 383A of the Companies Act, 1956, the Company
has obtained a Certificate from Company Secretary in the whole time
practice confirming that the Company has complied with the provisions
of the Companies Act, 1956 as mentioned in the Certificate, and a copy
of such certificate is annexed to this report.
Your Directors record their appreciation of the Co-operation and
assistance extended by Financial Institutions, Banks and Government
Authorities as well as valued customers from time to time. They also
record their appreciation of the devoted services rendered by the
Executives, Staff Members and Workers of the Company.
For and on behalf of the Board,
Date : 29th May, 2012 Mahendra K. Khatau
Place : Mumbai Chairman