The Directors are pleased to present the 38th annual report and the
audited accounts for the financial year ended 31st March 2014.
The Financial performance of the Company, for the year ended 31st March
2014 is summarized below.
(Rs in Lakhs)
Particulars 2013-14 2012-13
Total income 16,512 15,523
Total expenditure 15,591 14,305
Profit before interest, depreciation and tax 921 1,218
Finance cost 376 474
Depreciation 431 413
Profit before Exceptional items and tax 114 331
Exceptional Item 201 -
Profit after Exceptional item & before tax 315 331
Provision for taxation(Net of deferred tax) 61 130
Profit after tax 254 201
Balance in Statement of profit and loss 4,434 4,297
Amount available for appropriation 4,688 4,498
General reserve 13 11
Proposed dividend 45 45
Tax on proposed dividend 7 7
Balance carried to Balance Sheet 4,623 4,435
Total 4,688 4,498
REVIEW OF PERFORMANCE
During the year under review, the Company achieved a turnover of Rs.
16,449/- lakhs compared to Rs. 15,404/- lakhs in 2013. The operations
of the Company for the year under review have resulted in a net profit
of Rs.254/- lakhs.
Your Directors are pleased to recommend a dividend of 15% on the equity
shares of the company for the year ended 31st March 2014, subject to
the approval of the members at the ensuing annual general meeting.
Employee relations continue to be cordial. Your Directors would like to
place on record their appreciation of the valuable contribution to the
operations of the Company during the year.
Your Company is committed to maintaining high standards of Corporate
Governance. A Report on Corporate Gover- nance along with a certificate
from the statutory auditors on compliance of Corporate Governance norms
is part of this Annual Report.
A Report on Compliances along with the certificate from the Practicing
Company Secretaries on compliances is part of this Annual Report.
Information required under section 217(2A) of the Companies Act 1956
read with Companies (Particulars of Employment) Rules, 1975
In terms of the provisions of section 217(2A) of the Companies Act,
1956, read with the Companies (Particulars of Employees) Rules, 1975 as
amended, the names and other particulars of the employees are set out
in the annexure to the Directors'' Report.
Information required under section 217(2A) of the Companies Act 1956
read with Companies (Particulars of Employ- ment) Rules 1975
Sl Name Desig- GrossLast Qualif- Age Date of Exper- Last
No nation Remune- ication commme- ience employ-
ration ncement (inclu- ment held/
(Rs.) of empl- ding designa-
oyment previous tion/orga-
- Nil -
1. Employment throughout the year under review and were in receipt of
remuneration for that year in the aggregate of not less than Rs
60,00,000 or more - Nil
2. Annual remuneration as above includes salary, allowances and
3. The above appointment is contractual.
II. Employees of the Company who were employed for part of the
financial year and in receipt of remuneration at a rate, which in
aggregate was not less than Rs 500,000/- pm - Nil
During the year, the Ministry of Corporate Affairs (MCA) has notified
majority of the provisions inter alia provisions relating to selection,
manner of appointment,roles,functions, duties, re-appointment of
independent directors (IDs) and the relevant rules under the Companies
Act, 2013 (the Act 2013) and made them effective 1st April, 2014.
In terms of the provisions of Section 149(10) read with Section 149(5)
of the Act, 2013, IDs are eligible to hold office for a term upto five
consecutive years on the board and eligible for re-appointment for the
second term on passing special resolutions by the Company. During the
period, they will not be liable to ''retire by rotation'' as per the
provisions of Sections 150(2), 152(2) read with schedule 1V to the Act
It is, therefore proposed to appoint them as IDs for a consecutive
period of five years at the AGM. Necessary declara- tions have been
obtained from them, as envisaged under the Act 2013. In terms of the
provisions of sub-section(6) read with explanation to Section 152 of
the Act 2013, two-third of the total number of directors (excluding
IDs) are liable to retire by rotation and out of which, one third is
liable to retire by rotation at every annual general meeting. Mr.Osamu
Tanaka, director of the Company, is.therefore, liable to retire by
rotation, at the ensuring AGM, and being eligible, offers himself for
Mr. Y Mukaide has been serving on the board since 2005. During his
tenure of office,he has made distinct and immense contribution to the
deliberations of the meetings of the board in general and for the
growth of the company in particular. Yuken Kogyo Company Limited (YKC)
withdrawn his directorship owing to his retirement. The Board does
hereby record its deep sense of appreciation for the valuable services
rendered by him during his tenure.
As per the direction of YKC Mr.Shiro Hattori has to be appointed as a
director in his place.
Mr. V Balaji Bhat,Independent director of the Company resigned from the
Board effective from 8th February,2014. The Board does hereby record
its deep sense of appreciation for the valuable services rendered by
him during his tenure.
The brief resume of the directors proposed to be appointed and
re-appointed and other relevant information have been furnished in the
Notice convening the AGM. Appropriate resolutions for their
appointment/re-appointment are being placed for approval of the members
at the AGM.
The Board, therefore, recommends their appointment/re-appointment as
directors of the Company.
Pursuant to section 217 (2AA) of the Companies Act, 1956 your Directors
1. In the preparation of the accounts for the year ended 31st March
2014 the applicable accounting standards have been followed and there
are no material departures from the same;
2. The accounting policies which have been selected are applied
consistently, judgments and estimates that are reasonable and prudently
is made so as to give a true and fair view of the state of affairs of
the Company at the financial year ended 31st March 2014 and of the
profit of the Company for that year;
3. Proper and sufficient care has been taken 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 frauds and other irregularities;
4. The accounts for the year ended 31st March 2014 have been prepared
on a going concern basis.
MANAGEMENT DISCUSSION AND ANALYSIS
The Management Discussion and Analysis (MDA), which forms part of this
Directors'' Report, sets out an analysis of business including the
industry scenario, performance, financial analysis and risk mitigation.
The Company has not accepted any public deposits and as such, no amount
on account of principal or interest on public deposits was outstanding
as on the date of the balance sheet.
CONSOLIDATED FINANCIAL STATEMENTS
In accordance with the Accounting Standard AS-21 on Consolidated
Financial statements read with Accounting Standard AS-23 on
Accounting for Investments in Associates, the audited Consolidated
Financial Statements are pro- vided in the Annual Report.
In Accordance with the general Circular issued by the Ministry of
Corporate Affairs, Government of India, the Balance sheet, the
statement of Profit and Loss and other documents of the Subsidiary
Companies are not being attached with the Balance Sheet of the Company.
The Company will make available the Annual Accounts of the Subsidiary
Companies and the related detailed informa- tion to any member of the
Company who may be interested in obtaining the same. The Annual
Accounts of the Subsidiary Companies will also be kept open for
inspection by any investor at the Registered Office of the Company and
that of the respective Subsidiary Companies. The consolidated Financial
Statements presented by the Company include financial results of its
During the year under review, Your Company has the following subsidiary
Companies viz (i) Coretec Engineering India Pvt Ltd, Bangalore (ii)
Yuflow Engineering Pvt. Ltd, Chennai.
CORPORATE SOCIAL RESPONSIBILITY (CSR)
Your Company recognizes the community as an important stakeholder in
the business and believes in sustainability as a core parameter of its
The Company provides opportunities to Engineering and Management
Institute students to undergo in-plant training/ projects as part of
their academic curriculum, thus enabling them to appreciate application
of theoretical knowledge and get an exposure to the industrial
The Company''s employees participate in blood donation camps every year
and donate blood.
Employees are trained in ''First -Aid'' regularly. The Company has rain
water harvesting system in place in all the factory plants.
The Company''s products and services have very little or marginal impact
on the environment and it adheres to all related legal and statutory
HEALTH, SAFETY & ENVIRONMENT (HSE)
Health, Safety and environment are high priority issues in your
Your Company conducts annual medical check up for its employees and
assists the employees who need medical attention or counseling. The
employees and their dependents are covered under Health Insurance
Awareness workshops on safety in industries are being conducted for the
employees in collaboration with the Direc- torate of Factories and
Boilers, Government of Karnataka.
With no reportable injuries during the year, we are committed to
enhance occupational health and safety. Apart from personnel safety,
process safety is the top priority of the Management. Well documented
standards, emphasis on line management responsibility, an improved and
standardized process for safety observations are helping the
manufacturing sites achieve higher employee participation in the safety
All manufacturing locations remained fully compliant with Environmental
Regulations. High emphasis was placed on the productive use of raw
materials, natural resources, energy and on reducing wastes. We believe
that a sustainable Organization can be built only with the highest
standards of performance on economic, social and environmental param-
DISCLOSURE OF PARTICULARS UNDERSECTION 217(1) (E) OF THE COMPANIES ACT,
Energy conservation is a consistent focus area for the Company both
from a cost control and a social responsibility perspective. Energy
conservation is a consistent endeavor of your Company. The power factor
is regularly monitored and maintained between 0.99 and 1.00. Solar
lights have been installed at Malur Plant.
INFORMATION UNDER SECTION 217 (1) (e) OF THE COMPANIES ACT 1956 READ
WITH COMPANIES (DISCLOSURE OF PARTICULARS IN THE REPORT OF BOARD OF
DIRECTORS) RULES, 1988:
1. Conservation of Energy:
The Company has taken several steps and also in the process of
implementing several projects to conserve energy by various measures.
2. Research and Development (R&D)
The Company continues to invest in R&D activities towards development
of new products and applications, improvement in operating efficiencies
and reduction in manufacturing costs.
(a) Specific areas in which R&D carried out by the Company
Development of larger size valves for process and steel industries,
rugged vane pumps for special applications and development of high
efficiency gear pumps are some of the areas where R&D was carried out
by the Company.
(b) Benefits derived as a result of above R&D efforts
Special products developed to meet specific requirements of customers
which enable your Company to develop niche markets for growth.
(c) Future plan of action:
* Development of additional range of products.
* Focus on process improvements to enable the Company to penetrate the
* Strong focus on employee involvement to eliminate waste in Operations
through focused initiatives.
(d) Expenditure on R & D
There is a continuous increase in R & D expenditure as the scope of
activities carried out keeps on increasing. The exact amount spent has
not been apportioned this year.
4. Technology Absorption, Adaptation and Innovation:
(a) Efforts in brief, made towards technology absorption, adaptation
* Special models of pumps and valves have been designed to meet
specific needs of customers and these have enabled us to extend our
customer base to include a wider range of industries.
* Indigenization is a continuous ongoing effort.
(b) Benefits derived as a result of the above efforts:
* Reduction of material cost.
* Quality improvement and improvement in product performance
* Ability to innovate and produce new products.
(c) Information regarding technology imported during the last five
years reckoned from the beginning of the financial year.
i Technology imported - For manufacture of Chip compacting machine
ii Year of Import: 2011
iii Has technology been fully absorbed? Yes
iv If not fully absorbed, areas where this has not taken place, reasons
there off and future plans of action: N/A
The Company has appointed M/S. K.S.Kamalakara & Co. Cost Accountants as
cost auditors for conducting Cost Audit for the financial year 2013-14.
The Cost Audit Reports in XBRL mode for the financial year ended 31st
March 2013, was filed on 27th December 2013. The Cost Audit Reports
for the financial year ended 31st March 2014 will be filed before the
M/s. Deloitte Haskins & Sells, Chartered Accountants, who are the
statutory auditors of the Company, hold office, in accor- dance with
the provisions of the Act till the conclusion of the ensuing annual
general meeting and are eligible for re-appointment.
The Company has appointed M/s.BG & Associates, Company Secretaries for
the Secretarial Audit for the financial year 2014-15.
This report contains forward-looking statements that involve risks and
uncertainties. When used in this Report, the words anticipate'',
believe, estimate, expect, intend, will and other similar
expressions as they relate to your Company and / or its business are
intended to identify such forward-looking statements. Your Company
undertakes no obligation to publicly update or revise any
forward-looking statements, whether as a result of new information,
future events, or otherwise. Actual results, performances or
achievements could differ materially from those expressed or implied in
such forward-looking statements. This report should be read in
conjunction with the financial statements included herein and notes
Your Directors thank the customers, auditors, vendors, banks,
government, collaborators, investors and all other business associates
for their continued support. Your Directors also wish to place on
record their appreciation of the contribution made by all the employees
of the Company for their performance in the year under review.
For and on behalf of the Board
Place: Bangalore C P Rangachar CAPT. N S Mohanram R Srinivasan
Date: 29th May 2014 Managing Director Director