The Directors have pleasure in presenting the Forty Sixth Annual
Report together with the Audited Accounts of the Company for the
financial year ended 31st March, 2012.
FINANCIAL RESULTS 2011-2012 2010-2011
Rs. in Lakhs Rs.in Lakhs
Net Sales including Trading
and Operating Income 15,626.80 18,441.53
Other Income 444.91 140.94
Profit/(Loss) before Interest,
Depreciation, Amortization, 458.11 3,135.62
Taxes and Extraordinary Items
Interest 1,009.47 744.30
Cash Profit/(Loss) before
Extraordinary Items and Taxes (551.36) 2,391.32
Depreciation 677.83 639.92
Amortization 19.12 41.50
Extraordinary Items and Tax (1,248.31) 1,709.90
- Assets written off (Net) - -
Profit /(Loss) before Tax (1,248.31) 1,709.90
Provision for Taxation
(i) Current Tax 1.38 331.26
(ii) MAT - (45.00)
(iii) Deferred Tax (Asset)/Liability (217.84) 146.43
Profit/(Loss) after Tax (1,031.85) 1,277.21
Note: Previous year figures have been regrouped / rearranged wherever
Having regard to the financial position emerging out of the audited
accounts and in the absence of any scope for declaring any dividend out
of reserves, the Directors regret their inability to recommend payment
of any dividend.
REVIEW OF OPERATIONS
The net sale of the Company for the year under review is Rs. 153.55
crores as compared to Rs. 182.30 crores in the previous year, a fall of
about 16%. During the financial year 2011-12, the Company incurred net
loss of Rs.10.32 Crores as against profit after tax of Rs. 12.78 Crores
in the previous year.
During the year under review, exports registered Rs. 82.99 Crores
(Previous year: Rs. 104.34 crores) a fall of 20%, and domestic sale
registered Rs.70.56 Crores (Previous Year: Rs.77.95 Crores) a fall of
10% in comparison to previous year.
The reasons for loss of turnover and profitability are:
- On the export front, reduction in demand due to negative economic
conditions in Europe resulted in substantial reduction in turnover and
- Temporary ban imposed on production, use and sale of Endosulfan in
India adversely affected domestic sale of Thionyl Chloride.
- There has also been reduced demand from Agrochemicals and Dyes
sectors in addition to increased production capacities in India.
However, the Company has recovered partly the lost volumes. This
positive development was due to consistent efforts to broad base the
regional spread and customers.
(i) Transpek Industry (Europe) Ltd.
During the year under review, the wholly owned subsidiary of the
Company - Transpek Industry (Europe) Ltd. has facilitated registration
of three (3) products of Excel Industries Ltd. under REACH.
(ii) Sam Fine O Chem Ltd.
As reported earlier, the Company holds 50% of the paid up equity share
capital of Sam Fine O Chem Limited (Changed name effective 19.11.2011).
However, that company''s net-worth having been eroded, the promoters are
considering ways and means to improve it.
Pursuant to a resolution passed by the Board of Directors of the
Company in terms of the General Circular dated 8th February, 2011
issued by the Ministry of Corporate Affairs, Government of India, the
audited financial statements and the Reports of the Boards of Directors
and the Auditors of the Company''s subsidiaries are not attached to
this Annual Report. These documents shall be made available to the
members of the Company seeking such documents. The same are available
for inspection by members at the Registered Office of the Company and
that of the respective subsidiaries and on the Company''s website
We expect improving business conditions in the domestic as well as
Having introduced more products in different segments and regions, we
expect good growth in the coming period. Due to efforts being put in
extending/expanding regional spread, your Company has been able to
balance the business volumes in different regions.
Your Company has built a strong reputation as an environmentally
conscious organization. This provides reliability and sustainability
for the customers and hence we see more customers interested to discuss
long-term supply arrangements with the Company.
QUALITY, ENVIRONMENT, HEALTH AND SAFETY MANAGEMENT SYSTEMS
Re-certification audit of our existing Integrated Management System of
QMS ISO 9001:2008, EMS ISO 14001:2004 and BS OHSAS 18001:2007 was
successfully completed in February, 2012. The Company''s existing
Integrated Management System is in compliance with the requirements of
QMS ISO 9001:2008, EMS ISO 14001:2004 and BS OHSAS 18001:2007
HEALTH CARE AND WELFARE OF EMPLOYEES
Employees Welfare Schemes like subsidized canteen food, medical
facilities, merit awards for the employees'' children and Group
Insurance continued to be maintained by the Company. Sports and
cultural activities were also given priority during the year.
All functional heads periodically review risks facing their areas of
responsibility and implement an effective system of internal controls
to manage them.
The Managing Director and the Executive Director give overall
directions in controlling / mitigating risks generally. DIRECTORS
Shri Dipesh K. Shroff, Shri Ravi A. Shroff and Shri Nimish U. Patel,
Directors of the Company will retire by rotation at the ensuing Annual
General Meeting and, being eligible, offer themselves for
re-appointment. The Directors commend their re-appointment.
DIRECTORS'' RESPONSIBILITY STATEMENT
Pursuant to the requirements under section 217 (2AA) of the Companies
Act, 1956, with respect to Directors'' Responsibility Statement, the
Directors hereby confirm that:
a) in the preparation of the accounts for the financial year ended 31st
March, 2012 the applicable accounting standards have been followed and
that no material departures have been made from the same;
b) they 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 loss of the
Company for the year under review;
c) they 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 irregularities; and
d) they have prepared the annual accounts on a going concern basis.
CORPORATE SOCIAL RESPONSIBILITY
Your Company has undertaken or supported several social responsibility
One of the NGOs supported by the Company is the Shroffs Foundation
Trust (SFT) which has been working essentially in rural and tribal
areas in Gujarat in the fields of health, education, agriculture,
animal husbandry, watershed management and in skill development for
self-help. SFT works mainly with the Government of Gujarat on several
projects. SFT has put in place effective governance systems to ensure
transparency and accountability. The work done by SFT has recently been
recognized by the Times of India Group by bestowing on it the honor of
Social Impact Awards - Livelihoods category. SFT strives to create
self-help groups aimed at curbing unemployment in tribal youth.
The initiatives taken by the Company for managing the Industrial
Training Institute (ITI) at Padra, District Vadodara and the
development of ITI, Dashrath in Vadodara District as a centre of
excellence in chemical trade under the Public Private Partnership
scheme of the Government, as mentioned in our last Report, are
A separate statement on Corporate Governance is included in this Report
along with a certificate of the Auditors on its compliance.
MANAGEMENT DISCUSSION AND ANALYSIS
The report on Management Discussion and Analysis forming part of this
Annual Report deals with the Operations, Business Performance, etc.
During the year under review, your Company accepted deposits from
Public/Shareholders/ Employees/ Senior Citizens and has complied with
the provisions of section 58A of the Companies Act, 1956 and the Rules
framed there under. There were 117 deposits aggregating to Rs.26 lacs
which were due for repayment and remained unclaimed as on 31st March,
2012 of which 35 deposits amounting to Rs. 16.14 lacs have since been
repaid or renewed.
M/s. Contractor, Nayak & Kishnadwala, Chartered Accountants, Vadodara,
who have given a letter to the Company certifying that their proposed
appointment as Auditors would be in accordance with the limits
specified in Section 224 (1B) of the Companies Act, 1956, are proposed
to be re-appointed as the Auditors of the Company.
With regard to the Auditors'' qualificatory remarks at item (f) of
their report, as mentioned in note no. 30 (d) notes forming part of the
financial statements to the accounts, the Board is of the opinion that
in view of the significant uncertainties associated with the said
contract, whose ultimate outcome depends on future events, the exchange
gain or loss, if any, on the strike date would be accounted for in the
profit and loss account as and when it crystallizes.
TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
In terms of the provisions of Section 217(1 )(e) read with the
Companies (Disclosure of Particulars in the Report of the Board of
Directors) Rules, 1988 particulars as prescribed therein relating to
Conservation of Energy, Technology Absorption and Foreign Exchange
Earnings and Outgo are given in Annexure A forming part of this
COMPANIES (PARTICULARS OF EMPLOYEES) RULES, 1975
Information required pursuant to Section 217 (2A) of the Companies Act,
1956 read with Companies (Particulars of Employees) Rules, 1975 is
given in Annexure B forming part of this Report.
Your Directors wish to acknowledge the co-operation and assistance
extended to the Company by the Company''s Bankers and State Government
agencies. Your Directors also wish to place on record their
appreciation of the contribution made by employees at all levels
towards the growth of the Company. Your Directors also acknowledge with
gratitude the support of the shareholders, other investors, customers
and suppliers for the faith reposed in the Company and its management.
BY ORDER OF THE BOARD
PLACE : Vadodara A. C. SHROFF
DATED : 28th May, 2012 CHAIRMAN