1. CORPORATE INFORMATION
Sintex Industries Limited , the flagship company of Sintex group is a
public company domiciled in India and incorporated in 1931 under the
provisions of the Companies Act, 1956. It is headquartered in Kalol in
Gujarat. Its shares are listed on NSE, BSE & ASE in India. The Company
is one of the leading providers of plastics and niche structured yarn
dyed textiles related products in India. Initially the Company started
its operations in textile and diversified in plastic business in mid
70s. The plastic division manufacturers products which includes
prefabricated structures, monolithic constructions, FRP products and
water storage tanks.
i) Terms/ Rights attached to equity shares
The Company has only one class of equity shares having a par value of Rs.
1/- per share. Each holder of equity share is entitled to one vote per
share. The Company declares and pays dividend in Indian rupees. The
dividend proposed by the Board of Directors is subject to approval of
Shareholders in the ensuing AGM.
i) 2,500 (Previous year 2,500) 11.5% Secured Redeemable Non Convertible
debentures of Rs. 10,00,000/- each, issued to Life Insurance Corporation
of India are redeemable at par in three equal annual installments
starting from February 18, 2016. The Debentures are secured by first
mortgage charge on all the movable & immovable assets, both present &
future, of the Company on rank pari passu basis.
ii) 3,500 (Previous year 3,500) - 9.00% Secured Redeemable Non
Convertible Debentures of Rs. 10,00,000/- each, issued to Life Insurance
Corporation of India are redeemable at par in two tranches - 1,500
Debentures (Rs. 150 crore) on June 1, 2015 and 2000 Debentures (Rs. 200
crore) on June 24, 2015. The Debentures are secured by way of first
mortgage charge on all the movable & immovable assets, both present &
future, of the Company on rank pari passu basis.
iii) Term Loans from the banks viz. State Bank of India, Bank of
Baroda, IDBI Bank Limited and Syndicate Bank are secured by equitable
mortgage/hypothecation on all the immoveable and moveable properties of
the Company,both present and future except on specified current assets
and book debts on which prior charge created in favour of the Banks for
working capital facilities.
iv) Terms of repayments of term loans having interest upto 13% are
a) Loan taken from State Bank of India is repayable in 20 quarterly
installment of Rs. 6.25 crores each.
b) TUFs Loan taken from State Bank of India is repayable in 32
quarterly installment of Rs.4.69 crores each.
c) Loan taken from State Bank of India is repayable in annual
installments of Rs. 16.25 crores each from March 31, 2013 to March 31,
2016 and Rs. 130 crores each on March 31, 2017 and March 31, 2018.
d) TUFs loan taken from Bank of Baroda is repayable in 32 quarterly
installment of Rs. 1.50 crores each.
e) Loan taken from Bank of Baroda is repayable in 20 quarterly
installments of Rs. 2.50 crores each.
f) TUFs Loan taken from IDBI Bank Ltd. is repayable in 32 quarterly
installments of Rs. 2.34 crores each.
g) Loan taken from Syndicate Bank is repayable in 24 quarterly
installments of Rs. 2.75 crores each.
i) Balances with banks include deposits amounting to Rs. 55.32 crore (As
at 31st March 2011 Rs. 47.72 crore) which have an original maturity of
more than 12 months.
ii) Out of total deposits, Rs. 506.39 crore (previous year Rs. 505.26
crore) unutilised amount of FCCB issue.
iii) Balance with banks includes deposits of Rs. 164.95 crore (previous
year Rs. 142.49 crore) under lien to banks.
Considering the sudden devaluation of Indian Rupee against US Dollar as
an exceptional situation, the Company has disclosed the effect of Net
Foreign Exchange Loss / (Gain) on long term Foreign Currency Monetary
Items as Exceptional Item in the Statement of Profit and Loss.
2. (Rs. in crores)
2.1 Contingent liabilities in respect of :-
a) Amount of claims of certain retrenched
employees Amount not Amount not
for re-instatement with back wages ascertained ascertained
b) Corporate guarantees given to Banks/
Institutions 30.48 44.62
c) Performance guarantees given to
customers by bankers 32.63 16.41
d) Disputed demand not acknowledged as
debt against which the Company
has preferred appeal
- Income tax 12.97 12.97
- Sales Tax 2.35 2.35
- Service Tax 2.28 2.28
2.2 Estimated amount (net of advances) of
contracts remaining to be executed on
capital accounts and not provided for 8.28 -
2.3 A Scheme of Arrangement (the Scheme) between the Company and its
equity Shareholders was approved by the Board of Directors vide its
resolution dated 30th June, 2008, by the Shareholders in their Court
convened meeting held on 15th September, 2008 and by the Honourable
High Court of Gujarat vide its order dated 25th March, 2009. The
Appointed Date of the Scheme was 1st April, 2008. The Company filed the
Order with the Registrar of Companies, Gujarat on 14th April, 2009
within the time specified in the order and the Scheme had been given
effect in the financial statement for the financial year ended on 31st
March, 2010. Accordingly, as per the Scheme, from the said date, the
Company earmarked Rs. 200 crore from Securities Premium Reserve to
International Business Development Reserve Account (the IBDR).
As per the Scheme, the balance of IBDR so earmarked is available
towards such expenses as specified under the Scheme. Accordingly,
during the year, the Company has adjusted against the earmarked balance
of IBDR an amount of Rs. 4.42 crore (previous year Rs. 46.47 crore) being
such specified expenses as per the Scheme. The said accounting
treatment has been followed as prescribed under the Scheme and it has
no impact on the profit for the year, as per the Scheme.
2.4 The Company issued Zero Coupon Foreign Currency Convertible Bonds
(FCCBs) aggregating to US$ 225 million on March 12, 2008 for
financing foreign currency expenditure for expansion plans in existing
businesses, investments in overseas joint ventures and/or wholly owned
subsidiaries, international acquisitions and others.
As per the terms & conditions of the Offering Circular dated March 12,
2008, the Conversion Price of FCCBs is reset at Rs. 246.50 from Rs. 290.00
per equity share of Rs. 1 each on March 12, 2010.
Unutilised FCCB proceeds amounting to Rs. 506.39 crore (previous year Rs.
505.26 crore) have been invested in fixed deposits and Rs. 71.39 crore
(previous year Rs. 1.85 crore) have been lying in Current Account with
banks at the year end.
The outstanding FCCBs will be redeemed in March 2013.
2.5 During the year, the Company has opted for the option given in the
paragraph 46A of Accounting Standard -11 The Effects of Changes in
Foreign Exchange Rates inserted by the Notification dated 29th
December, 2011 issued by the Ministry of Corporate Affairs and
accordingly the Foreign Exchange Loss incurred on Long Term Foreign
Currency Monetary Items is amortized over the balance period of such
Long Term Foreign Currency Monetary Items. The unamortised balance is
carried in the Balance Sheet as Foreign currency monetary item
translation difference account net of tax effect thereon. Pursuant to
such adoption of the option, total amortization of the Foreign Exchange
Loss incurred on Long Term Foreign Currency Monetary Items is lower by
Rs. 44.21 crores and Profit for the year is higher by the said amount.
On the basis of information and records available with the Company,
there are no delays in payments to Micro and Small Enterprises as
required to be disclosed under the MSM Act and the above mentioned
disclosures are made under Note 9 Trade Payables. The above
information has been determined to the extent such parties have been
identified by the Company on the basis of information supplied by the
parties, which has been relied upon by the auditors.
i) Loans & Advances shown above fall under the category of Loans and
Advances in nature of loans where repayment will commence in three
annual equal installment from the end of 3rd year.
ii) Rate of Interest for the loans and advances given to Zep Infratech
Limited, Bright AutoPlast Limited and Sintex Infra Projects Ltd.has
been decided on draw down but not less than prevailing bank rate
B) Investment by the loanee in the shares of the Company
None of the loanees and loanees of subsidiary companies have, per se,
made investments in shares of the Company.
2.6 Foreign currency exposure not hedged by derivative instruments as
at 31st March, 2012 amounting to Rs. 1,158.25 crore (previous year Rs.
3. DISCLOSURES UNDER ACCOUNTING STANDARDS
3.1 Employee benefit plans
a Defined contribution plans
The Company makes Provident Fund and Superannuation Fund contributions
to defined contribution plans for qualifying employees. Under the
Schemes, the Company is required to contribute a specified percentage
of the payroll costs to fund the benefits. The Company recognised Rs.
5.05 crores (Year ended 31 March, 2011 Rs. 4.68 crores) for Provident
Fund contributions and Rs. 0.81 crores(Year ended 31 March, 2011 Rs. 0.81
crore) for Superannuation Fund contributions in the Statement of Profit
and Loss. The contributions payable to these plans by the Company are
at rates specified in the rules of the scheme.
b Defined benefit plans
The Company offers the following employee benefit schemes to its
The discount rate is based on the prevailing market yields of
Government of India securities as at the Balance Sheet date for the
estimated term of the obligations.
The estimate of future salary increases considered, takes into account
the inflation, seniority, promotion, increments and other relevant
3.2 As per Accounting Standards (AS) 17 Segment Reporting, segment
information has been provided in the Notes to Consolidated Financial
3.3. c Disclosure of Material Related Party Transactions during the
1) Purchase of goods/services include services from Bright AutoPlast
Ltd. Rs. Nil (Previous Year Rs. 12.14 crore)
2) Sale of goods/services include sale to Zep Infratech Limited Rs. Nil
(Previous Year Rs. 0.31 crore), Sintex Infra Projects Ltd. Rs. 5.05 crore
(Previous Year Rs. 20.05 crore)
3) Sale of fixed assets to Sintex Infra Projects Ltd. Rs. 249.59 crore
(Previous Year Rs. Nil)
4) Managerial Remuneration include remuneration to Shri Dinesh B. Patel
Rs. 2.85 crore (Previous Year Rs. 2.76 crore), Shri Arun P. Patel Rs. 2.82
crore (Previous Year Rs. 2.75 crore), Shri Rahul A. Patel Rs. 2.57 crore
(Previous Year Rs. 2.53 crore), Shri Amit D. Patel Rs. 2.56 crore (Previous
Year Rs. 2.54 crore), Shri S B Dangayach Rs. 1.86 crore( Previous Year Rs.
5) Unsecured Loan/Advance Given include to Zep Infratech Ltd. Rs. Nil
(Previous Year Rs. 12.25), Bright AutoPlast Ltd. Rs. 25.76 crore (Previous
Year Rs. 14.07 crore), Sintex Infra Projects Ltd. Rs. 9.22 crore (Previous
Year Rs. 17.88 crore). Loan returned during the year from Zep Infratech
Limited Rs. 1.11 crore (Previous Year Rs. 8.00 crore), Bright AutoPlast
Ltd. Rs. 16.14 crore (Previous Year Rs. 5.22 crore) Sintex Infra Projects
Ltd. Rs. Nil (Previous Year Rs. 9.50 crore)
6) Dividend received include from Zep Infratech Limited Rs. 0.65 crore
(Previous Year Rs. 0.65 crore).
Note: 4. ESOP
i) The Company initiated the Sintex Industries Limited Employee Stock
Option Scheme, 2006 (the Scheme) for all eligible employees in
pursuance of the special resolution approved by the Shareholders in the
Extraordinary General Meeting held on 24th February, 2006. The Scheme
covers all directors and employees (except promoters or those belong to
the promoters'' group) of the Company and directors and employees of
all its subsidiaries. Under the Scheme, the Compensation Committee of
the Board (the Committee) administers the Scheme and grants stock
options to eligible directors or employees of the Company and its
subsidiaries. The Committee determines the employees eligible for
receiving the options and the number of options to be granted subject
to overall limit of 10,000 options per annum for each employee. The
vesting period is at the expiry of thirty six months from the date of
the grant of option. The Committee has decided the exercise price of Rs.
91.70 per equity share of Rs. 2 each as per clause 8.1 of SEBI (Employees
Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines,
ii) The Company gave loan to Sintex Employees Welfare Trust (ESOP
Trust) towards subscribing 10,00,000 equity shares of the Company at Rs.
91.70 per equity share of Rs. 2 each aggregating to Rs. 9.17 crore. On 21st
August, 2006, the Company issued 10,00,000 equity shares of the face
value of Rs. 2 each to ESOP Trust at Rs. 91.70 per equity share.
iii) On 27th October, 2010, each equity share of Rs. 2 each has been
sub-divided into two equity shares of Rs. 1 each. Hence ESOP Trust holds
20,00,000 equity shares of the face value of Rs. 1 each at Rs. 45.85 per
The Company prepares and presents its financial statements as per
Schedule VI to the Companies Act, 1956, as applicable to it from time
to time. In view of revision to the Schedule VI as per a notification
issued during the year by the Central Government, the financial
statements for the financial year ended 31st March, 2012 have been
prepared as per the requirements of the Revised Schedule VI to the
Companies Act, 1956. The previous year figures have been accordingly
regrouped / re-classified to conform to the current year''s