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Spentex Industries Ltd.

BSE: 521082 | NSE: SPENTEX | Series: BZ | ISIN: INE376C01020 | SECTOR: Textiles - Spinning - Cotton Blended

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Annual Report

For Year :
2016 2015 2014 2013 2012 2011 2010 2009 2008

Director’s Report

Dear Members,

The Directors are pleased to present the 24th Annual Report on the business and operations of the Company along with the Audited Financial Statements for the financial year ended March 31, 2016.

Financial Results

The highlights of the financial results for the year ended 31st March, 2016 are as under:

(Rs. in Crores)








Net Sales (Turnover)





Other Income










Financial charges










Profit/(Loss) before tax (PBT)





Extra ordinary items (income)/ Impairment loss @ Fixed Assets





Exceptional Items





Net Profit from Operations





Prior Period Items





Tax expenses





Net Profit/(Loss)










Management Discussion and Analysis Report:

The Indian Textile Industry has a pre -eminent position in the Indian economy with an aggregate turnover of $ 110 billions with exports of $ 40 billion. India is the second largest exporter of textiles in the world & Textile industry is the 2nd largest employer after agriculture & contributes over 4% of GDP. The industry has potential for creation of employment especially in semi urban & rural areas both in organized and unorganized sector. It provides employment also to semi skilled labor and employees women in large segment of operations. The industry is self reliant and has very little to import, thus contributes in accretion of foreign exchange.

Spentex has integrated Cotton, Polyester & blended Yarn manufacturing facilities in India with stable customer base with long term mutually beneficial business relationship both in India and abroad. The company has presence across the entire value chain of cotton and polyester yarn with ability to offer varied products as required by the Indian and global markets.

The operations of the Company during the year were adversely impacted due to shortage of working capital, demand & supply gap and slow off take in internal market and overall subdued sentiments in the business world. The Company''s Exports have also failed to cheer us up due to the tariff disadvantage created by FTAs of our competitors with the big buying nations. A huge disparity between spot cotton prices and yarn prices affected the margins of the company. As a result, there has been significant decline in EBIDTA levels which have resulted in huge financial strain on the Company.

However, with due strategic focus on efficient plant operations and day to day supervision of operations by management and other administrative and operational initiatives taken by the company, the EBITA levels have slightly improved as compared to previous year. Keeping in view the market trends and the emerging business scenario, Spentex is confident of improvement in its operational performance in near future.

Management Perception on Opportunities, Risks, Concern & Outlook

The weakening Indian Rupee, as compared to U.S Dollar and other European currencies provides an opportunity to the textile industry to optimize its sales volumes and margins respectively in exports. Spentex will continue to offer market driven quality product mix for progressively improving its operations and output. The Indian textile sector is also facing the challenges of outdated technology especially in weaving and processing resulting into lower productivity thus impacting the competitiveness of the industry. High power tariffs in India are impacting the viability of the industry.

Due to fluctuating prices and uncertainties in the foreign exchange market, increase in power cost and lack of adequate working capital, the EBITA levels may remain stagnant during the year. Management is keeping a close watch on various threats/risks facing the company and taking all appropriate steps to improve the performance of the Company. The Indian Textile industry is expected to become strong & vibrant through various support measures announced by the Government of India, especially technology up gradation fund and a package for apparel Industry.

Another key challenge presently is the Fiber/Raw Material cost, which has increased abruptly and increase is not fully absorbed in the yarn prices and accordingly yarn spinners are hit the most in the entire textile chain. However, your directors and management would take all necessary measures to hedge this risk and increase the EBITA levels in coming quarters.

Quarter 3 & 4 of the financial year 2015-16 witnessed an increase in demand of cotton yarn in domestic as well as foreign market. With the strong domestic consumption trend and initiatives formulated by the Company with regard to product mix, waste management control & other related issues, your directors are confident that sales volumes would reasonably shore up with consequent strengthening of the margins in due course.

Financial Analysis and Performance Review

During the financial year 2015-16 the Company''s operations were adversely impacted due to increase in Fiber/Raw Material cost which is not fully absorbed in the yarn prices, high power tariff, and constraints of working capital leading to non optimal utilization of plant capacities and consequent decrease in EBIDTA.

The financial performance of the Company has been presented in two parts, as under:

i) Spentex Industries Limited (Standalone) excluding the performance of its subsidiaries and step-down subsidiaries.

(ii) Spentex Industries Limited (Consolidated) including the performance of its subsidiaries and step-down subsidiaries. The Consolidated Financial Statements reflect the performance of Spentex Group of companies and are more relevant for understanding the overall performance of the Group.

Segment-wise Performance Yarn Manufacturing

During the year under review, your Company on standalone basis has manufactured 46,939.32 MT of yarn as compared to 44,930.63 MT of yarn produced during the previous year.


The Company has following four subsidiaries/step down subsidiaries as on March 31, 2016.

(a) M/s Amit Spinning Industries Limited.

(b) M/s Spentex (Netherlands) B.V.

(c) M/s. Schoeller Textile (Netherlands) B.V.

(d) M/s Spentex Tashkent Toytepa LLC. (due to breach of Investment Agreement by Republic of Uzbekistan with its Investors, its holding Company SNBV, has filed case in ICSID)

There was no material change in the nature of the business carried on by the subsidiaries.

Performance of Subsidiaries

The details of turnover and overall performance of material subsidiary companies is as under:

Amit Spinning Industries Ltd., India: The company has its manufacturing facilities at Kolhapur, Maharashtra with capacity of 30,672 spindles. During the year under review, the subsidiary''s operations remained suspended due to financial constraints and non-availability of working capital. The Rehabilitation Scheme filed by the company with BIFR is yet to be considered and approved. Accordingly, the subsidiary''s revenue has been severely affected and revenue from operations during the year 2015-16 was Rs. 38.98 Lakhs as compared to Rs. 32.05 Crores during 2014-15.

Spentex Tashkent Toytepa LLC, Uzbekistan (STTL) & Spentex Netherlands B.V, Netherlands (SNBV): During the period under review, the Arbitration Proceedings against GOU for Investment Dispute Claim before International Center for Settlement of Investment Dispute (ICSID) were held at the World Bank from 14th Sept., 2015 to 25th Sept. 2015 and both the parties i.e. M/s. Spentex (Netherlands) B.V., a subsidiary of the company and Government of Uzbekistan (GOU) have submitted the pre & post hearing briefs to tribunal on 7th December, 2015. The judgment/award is yet awaited.

Consolidated Financial Statements

There are no associate companies or joint venture companies within the meaning of section 2(6) of the Companies Act, 2013. Pursuant to the provisions of Section 129(3) of the Companies Act, 2013, a statement containing salient features of financial statements of subsidiaries, associates and joint venture companies in Form AOC-1 is attached to the Accounts.

In accordance with the provisions of Section 136 of the Companies Act, 2013, the audited financial statements including consolidated financial statements of the Company and audited accounts in respect of each of the subsidiary companies are available on website of the Company These documents shall also be kept open for inspection during business hours at the Registered Office of the Company on or before ensuing General Meeting. The Company will also make available these documents upon request by any Member of the Company interested in obtaining the same.

The Consolidated Financial Statements of the Company prepared in accordance with the applicable Accounting Standards issued by the Institute of Chartered Accountants of India form part of this Annual Report.

Share Capital

As on 31st March, 2016, the Company''s issued and paid up capital stands Rs. 89, 77, 20,350/- divided into 8,97,72,035 fully paid up equity shares of Rs. 10/- each. During the year, under review, the Company has not issued any share(s). Further the Company has not issued any share with differential Voting Rights/Sweat Equity shares/under Stock Option Scheme (ESOS) earlier and during the year.

The Company had issued 500 non-convertible debentures of Rs. 10.00 lacs each; however during the year under review, no debenture has been issued.

The Company has no scheme or provision of money for purchase of its own shares by employees or by trustees for the benefit of employees. Hence the details under rule 16 (4) of Companies (Share Capital and Debentures) Rules, 2014 are not required to be disclosed.

During the year under review, your Company had obtained approval of the members at their 23rd Annual General Meeting held on 30th September, 2015 for issuance of 1,10,95,000 equity shares of Rs. 10/- each to Promoters/Promoter Group on preferential basis. Subsequently, the Company had applied to NSE and BSE for obtaining in-principal approval for issuance of aforesaid shares. However, since these shareholders are holding shares, a non disposal undertaking under Regulation 78 of SEBI (ICDR) Regulations is required from the lenders to whom the said shares have been pledged. However, since the lenders have refused to provide such undertaking in principle approval was not accorded and the Company has since withdrawn the application filed before stock exchanges. The Board of Directors are looking for alternate options for issue of said shares to the promoters.


(a) Change in Directors or Key Managerial Personnel

In terms of provisions of the Companies Act, 2013 read with SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the following appointment/re-appointment/cessation are made in directors/Key Managerial Personnel during the period under review:

1. Mr. Samir Kumar Nath has been appointed as non retiring Nominee Director (nominated by State Bank of India, Lead Bank) on the Board of the Company w.e.f 17th September, 2015.

2. Mr. Prem Malik, Independent Director, Mr. Sitaram Parthasarathy, Director Works and Mr. Rajeev Kalra, Nominee Director (Nomination withdrawn by VCIGPM Ltd.) have resigned from the Board of Directors of the Company w.e.f 13th August, 2015, 7th November, 2015 and 11th September, 2015 respectively.

3. Dr. Sunil Kumar Gupta has been appointed as Company Secretary of the Company in place of Mr. Ranjan Mangtani w.e.f. 10th February, 2016.

In accordance with the provisions of the Companies Act, 2013 and Articles of Association of the Company, Mr. Amrit Agrawal, director of the Company retires by rotation at the ensuing Annual General Meeting and being eligible, offer himself for re-appointment.

Brief resume of the Directors proposed to be appointed/re-appointed, nature of their expertise in specific functional areas and names of the companies in which they hold directorship and membership/chairmanships of the Board or its Committees is provided in the Report of Corporate Governance forming part of the Annual Report.

Number of Meetings of the Board

Four meetings of the Board were held during the year. The detailed information of the meetings of the Board held during the year is mentioned in the Corporate Governance Report which forms part to this report.

Declaration by Independent Directors

The Company has received necessary declaration from each Independent Director under Section 149(7) of the Companies Act, 2013 that they meet the criteria of independence as laid down under Section 149(6) of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The non-executive directors of the Company had no pecuniary relationship or transactions with the Company, other than the sitting fees and reimbursement of expenses incurred by them for the purpose of attending meetings of the Company.

Board evaluation

In terms of the applicable provisions of the Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, the Board has carried out the annual performance evaluation of its own performance, the Directors individually as well as Board Committees.

The board and the nomination and remuneration committee reviewed the performance of the individual directors on the basis of the laid down criteria.

The Independent directors in their separate meetings held on 29th May, 2015 and 10th February, 2016, evaluated the performance of non-independent directors. Performance of the board as a whole has been carried out taking into account the views of independent directors. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.

Remuneration Policy

The Board has, on the recommendation of the Nomination & Remuneration Committee, framed a policy for selection and appointment of Directors, Senior Management and their remuneration. The Remuneration Policy is stated in the Corporate Governance Report. During the year, neither the Managing Director nor the Whole-time Directors of the Company received any remuneration or commission from any of its subsidiaries. The Company affirms that remuneration is as per the remuneration policy of the Company.

Committees of the Board

Currently, the Board has eight committees namely the Audit Committee, the Nomination and Remuneration Committee, the Corporate Social Responsibility Committee, the Stakeholders Relationship Committee, the Risk Management Committee, Banking Committee, Investment Committee and Fund Management Committee.

Audit Committee

As on 31st March, 2016, the Audit Committee comprised of Mr. Ram Kumar Thapliyal, Independent Director (Chairman), Mr. Dhananjaya Prasad Singh, Independent Director and Mr. Amrit Agrawal, Executive Director (Members).

Corporate Social Responsibility

In accordance with the provisions of Section 135 of the Companies Act, 2013, the Corporate Social Responsibility (CSR) Committee of the Board has been constituted on 28th May, 2014, inter alia, to formulate and recommend to the Board, a CSR Policy which shall indicate the activities to be undertaken by the Company and monitor the same from time to time. The composition of committee is disclosed in Corporate Governance Report forming part to this report. The CSR policy has also been hosted on the website of the company Risk Management

The Board of Directors of the Company has constituted a Risk Management Committee to oversee the risk management plan in the Company. The details of Committee and its terms of reference are set out in the Corporate Governance Report forming part of the Board''s Report. The Risk Management Policy has also been hosted on the website of the Company.

A detailed note on the composition of the Board and its various committees is provided in the Corporate governance report forming part to this Annual Report.

Vigil Mechanism

The Company has framed and implemented a vigil mechanism named as Whistle Blower Policy to deal with instances of fraud and mismanagement, if any. The details of the Whistle Blower Policy are provided in the Corporate Governance Report and also posted on the website ( of the Company. The Company has received three complaints till date and the same were duly redressed. Directors'' Responsibility Statement

Pursuant to the requirement of Section 134(3)(c) of the Companies Act, 2013, with respect to Directors'' Responsibility Statement, it is hereby confirmed that:

(a) In the preparation of the annual accounts for the financial year ended 31st March, 2016, the applicable accounting standards had been followed along with proper explanation relating to material departures;

(b) 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 as at March 31, 2016 and of the profit and loss of the company for that period;

(c) The directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

(d) The directors had prepared the annual accounts on a going concern basis; and

(e) The directors had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.

(f) The directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

Related Party Transactions

None of the transactions with related parties falls under the scope of section 188(1) of the Act. All related party transactions that were entered into during the financial year were on an arm''s length basis and were in the ordinary course of business. There were no materially significant related party transactions entered into by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large.

Prior omnibus approval of the Audit Committee was obtained for Related Party Transactions for the quarter/year ended 31st March, 2016, transactions proposed to be entered into with the related parties in the year 2016-17 were placed before the said committee and consent of said the committee was obtained.

The policy on Related Party Transactions as approved by the Board has been uploaded on the Company''s website None of the Directors has any pecuniary relationships or transactions vis-a-vis the Company. Since all related party transactions entered into by the Company were in the ordinary course of business and were on an arm''s length basis, form AOC - 2 is not applicable to the Company. Significant and Material Orders passed by the Regulators or Courts

During the year under review, there are no significant or material orders passed by the Regulators / Courts which would impact the going concern status of the Company and its future operations.


Pursuant to the provisions of Section 139 of the Companies Act, 2013 and rules framed there under, M/s. J C Bhalla & Co., Chartered Accountants, (Registration No. 001111N) were appointed as Statutory Auditors of the Company at Annual General Meeting held on 11th September, 2014 to hold office till conclusion of 25th Annual General Meeting for a period of three years subject to ratification of their appointment at every Annual General Meeting.

The Company has received a confirmation from M/s. J C Bhalla, Chartered Accountants to the effect that their appointment, if made, at the ensuing AGM would be in terms of Sections 139 and 141 of the Companies Act, 2013 and rules made there under and that they are not disqualified for re-appointment.

Auditors Report

The Auditors'' Report read with the Notes to Accounts is self-explanatory and does not call for any further explanation under Section 134 of the Companies Act, 2013, except for the responses in respect of some observations as mentioned here in below.

Directors'' view on Auditor''s Observations

Directors'' response to the various observations of the auditors made in their report, even though explained wherever necessary through appropriate notes to accounts, is reproduced hereunder in compliance with the relevant legal requirements:

Note No. 39 of the Financial Statement qualified by Auditors

The company has an investment of Rs. 204,469,921/- in and has amount recoverable amounting to Rs. 732,239,193/- to Amit Spinning Industries Limited (ASIL), a subsidiary, as on March 31, 2016. The accumulated losses of ASIL, at the year end exceeded its net worth. There is also reduction in market value of the investment at the yearend by Rs. 187,475,249/-. In the opinion of the management, diminution in this long term investment is due to adverse business conditions in the past. Management believes that diminution in the value of investment is of temporary nature and that outstanding would be realized within a reasonable period of time. Accordingly no provision considered necessary in the value of investment held and amount due from ASIL.

Note No. 40 of the Financial Statement qualified by Auditors

The Company has an investment of Rs. 561,011,339 and Rs. 9,323,779 in its subsidiary Spentex Netherlands B. V. (SNBV) and its step down subsidiary Spentex Tashkent Toytepa LLC (STTL) respectively. Further it has Rs. 70,012,404 as export receivable from STTL and advances recoverable of Rs. 95,070,902 in SNBV as on March 31st, 2016. During the period of investment, Government of Uzbekistan (GOU) changed certain laws and policies breaching the investment agreement and rendered operation of STTL not only unviable, but also expropriated its investment. All the assets and liabilities of STTL have been taken over by National Bank of Uzbekistan (NBU) and existence of STTL has been liquidated as per bankruptcy laws. In view of this corporate guarantee given by company in respect of STTL liability for deferred payment to Tashkent Toytepa Textile (TTL) stand extinguished. SNBV, which had made around 99% investment in the equity of STTL, had filed request for Arbitration against GOU for Claim through its lawyer before International Center for Settlement Investment Dispute (ICSID). Based on the claim lodged with ICSID, Board of Directors has decided not to make any provision for the aforesaid amounts. In addition to above claim, the company has sent notice to the GOU for indemnify the further losses caused to company directly or indirectly on account of investment made in Uzbekistan.

Note No. 42 of the Financial Statement qualified by Auditors

As regards an amount of Rs. 12,830,469 (Rs. 12,830,469) dues from Government Authorities, company filed an application for release with concerned authorities. The Company is making effort to recover the same and expects to reduce the outstanding dues significantly. The management is of the opinion that ultimately there would be no losses against these old balances and hence no provision is considered necessary at this stage.

Note No. 43 of the Financial Statement qualified by Auditors

Advance balances aggregating to Rs. 55,982,580 are due from certain parties where payments are not forthcoming. The company is making appropriate concerted efforts including negotiations with these parties to recover the same and expect to reduce the outstanding dues significantly. The management is of the view that ultimately there would be no losses against these outstanding balances and hence no provision is considered necessary at this stage.

Note No. 49 of the Financial Statement qualified by Auditors

The company''s accounts have become Nonperforming assets (NPA) with majority of the dealing banks. The company has submitted restructuring proposal proposing various alternatives to the banks which is under discussions. None of the banks has initiated action in any legal forum. The company has provided interest on such loans, however penal interest, if any, has not been provided.

Note No. 4 of the Financial Statement without qualifying by Auditors

The Company has not allotted shares against the share application amount of Rs. 1,109.50 Lakh which was brought in by the promoters in more than one installment under restructuring scheme approved by the Bankers. Due to pending necessary approvals and directions for allotment of shares, the Company has not complied with the provisions of Section 42 of the Companies Act, 2013. The Company is looking for alternative options for issuance of said shares to promoters/promoter group.

Note No. 41 of the Financial Statement without qualifying Auditors

The accumulated losses of the Company had exceeded its net worth during the year 2011-12. Accordingly company in compliance with the provisions of section 15(1) of Sick Industrial Companies (Special Provisions) Act, 1985 filed a reference with Board for Industrial and Financial Restructuring (BIFR). The company''s operations were adversely affected in earlier financial years due to sluggish market demand, greater decline in cotton prices globally as compared to India, and higher power cost in Maharashtra, certain policies of the Government and shortage of working capital. In spite of the unfavorable market scenario and financial constraints, the units of the company continue to operate at satisfactory capacity utilization levels and are generating positive Earnings before Interest Depreciation Tax and Amortization (EBIDTA). The company''s accounts have become Nonperforming assets (NPA) with majority of the dealing banks and the company is also in receipt of NPA cum recall notice. The company has submitted/in process of submitting restructuring proposal proposing various alternatives to the banks which is currently under discussion. With strong management focus on strategic initiatives for cost rationalization, optimum product mix and efficient plant operations, the management believes that accumulated losses would reasonably be paired, in due course. The financial statements, as such have been prepared on a going concern basis.

Note No. 42 of the Financial Statement without qualifying by Auditors

Advance balances aggregating to Rs. 18,410,722 from a party where payments are not forthcoming. Against the above, the Company has filed a suit for recovery. Based on outcome of the legal suit coupled with further negotiations with the party, the management is of the opinion that ultimately there would be no losses against these old balances and hence no provision is considered necessary at this stage.

Note No. 44 of the Financial Statement without qualifying by Auditors

The company has applied to Securities & Exchange Board of India (SEBI) seeking exemption for maintaining at least 15% of the amount of its debenture maturing during the financial year 2016-17 vide circular no 04/2013 dated 11-Feb-2013 issued by Ministry of Corporate Affair, which is still awaited.

Note No. 45 of the Financial Statement without qualifying by Auditors

The outstanding balance as on 31st March, 2016 in respect of certain trade receivables, trade payables and loans & advances are subject to confirmation/reconciliation and consequential adjustment if any, from the respective parties. The management, however, does not expect any material variations.

Cost Auditors

Mr. Rajesh Goyal, Cost Accountant of M/s. K G Goyal & Associates, Cost Accountants (Firm Registration No.000024) has been appointed as Cost Auditors to carry out audit of the Cost Accounts maintained by the Company for the financial year 2016-17.

Secretarial Auditor & Audit Report:

The Board has appointed M/s. Loveneet Handa & Associate, Practicing Company Secretary (having CP No. 10753 & Membership No. 25973) as Secretarial Auditor to conduct secretarial audit for the financial year 2015-2016. The Secretarial Audit Report for the financial year ended March 31, 2016 in Form MR-3 is annexed herewith as Annexure I to this Report in compliance with the provisions of Section 204 of the Companies Act, 2013.

The Secretarial Auditors'' Report does not contain any qualifications or reservation or adverse remarks except non issue of 1.10 cr. equity shares of Rs. 10/- each to promoters group due to non receipt of in-principle approval from stock exchanges and non payment of EPF dues for the month of March, 2016 in respect of Pithampur Plant and Corporate Office.

Internal Auditors

Pursuant to section 138 of the Companies Act, 2013 read with The Companies (Accounts) Rules, 2014, the Company has appointed Dr. Sunil Kumar Gupta as Internal Auditor of the Company.

Internal Financial Control Systems and Adequacy

The Company has adequate system of internal financial control with regard to various business processes, financial reporting and compliance with applicable laws and regulations, etc. with clearly defined roles and responsibilities for all managerial positions. All operating parameters are continuously monitored and controlled.

The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control systems, accounting procedures and policies at all locations of the Company and its subsidiaries. Based on the internal audit reports, process owners undertake corrective actions in their respective areas and thereby further strengthen the controls. Significant audit observations and corrective actions thereon are presented to the Audit Committee of the Board.

Extract of the Annual Return

As provided under section 92(3) of the Act, the extract of annual return in the prescribed Form MGT-9 is annexed as Annexure-2 to this Report. Conservation of Energy, Technology Absorption and Foreign Exchange Earnings and Outgo

Company has implemented energy conservation initiatives and such action has resulted into major savings in energy consumption as well as in cost control. The information as required to be disclosed under Section 134(3)(m) of the Companies Act, 2013 read with Rule, 8 of The Companies (Accounts) Rules, 2014 is set out in the Annexure - 3 to this Report.

Particulars of Employees

The statement containing particulars of employees as required under section 197(12) of the Act read with Rule 5(2) & 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 as amended, shall be made available to any shareholder on a specific request made by him in writing on or before 27th September, 2016.


The Company has not accepted or renewed any deposit during the year and there are no outstanding and/or overdue deposits as at 31st March, 2016.

Particulars of Loans, Guarantees or Investments

Details of loans, Guarantees and Investments covered under the provision of Section 186 of the Companies Act, 2013 have been disclosed in the Financial Statements.


During the year under review, the Company has no distributable profits hence your Directors do not recommend payment of any dividend. Transfer of Reserves

During the year, the Company has not transferred any amount to reserves.

Material changes and commitments affecting the financial position of the Company between the date of Board Report and end of Financial Year

There have been no material changes and commitments, if any, affecting the financial position of the Company which have occurred between the end of the financial year of the Company to which the financial statements relate and the date of the report.

Human Resources/Industrial Relations

The Company and its management value the talent, commitment and dedication of its employees and acknowledge their contribution. All employees in the Company work as a team and integral part of the family, sharing their ideas and concerns through discussions, Town Hall meetings and intranet communication network installed across the units.

Industrial Relations scenario at all units continues to be healthy and enthusiastic.

To foster a positive workplace environment, free from harassment of any nature, the Company has framed a policy on Prevention of Sexual Harassment of Employees and constituted an internal committee to address and redress complaints of sexual harassment at the workplace in accordance with the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. During the year under review, no case has been filed in this regard.

Information Technology

Information Technology continues to be an integral part of your company''s business strategy. The Company is working on SAP platform integrating all its units located at different places/locations, its business processes, financial parameters, customer transactions and people, effectively on real time basis.

Change in the nature of Business

There is no change in the nature of the business of the company.

Corporate Governance and Management Discussion and Analysis

As stipulated under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, a report on Corporate Governance is attached separately as a part of the Annual Report and the Management Discussion and Analysis (MD & A) is also included in this report so that duplication and overlapping between Directors'' Report and a separate MD & A is avoided and the entire information is provided in a composite and comprehensive manner.

Listing of Shares

Presently Company''s shares are listed and traded at the BSE Ltd., Mumbai (BSE) and National Stock Exchange of India Ltd, Mumbai (NSE), for which annual Listing Fee has been paid by the Company, till 31st March, 2017.


Your Company enjoys leadership position in domestic market with strong competitive advantage in the export segment. However due to sluggish market and consequent losses in the recent past, the Company is currently in consolidation mode. We shall, continue to explore the opportunities to further strengthen our leadership position.


Your Directors take this opportunity to thank the Financial Institutions, Banks, Central and State Governments authorities, Regulatory authorities, Stock Exchanges, stakeholders, customers and vendors for their continuous support and co-operation, and for the trust reposed by them in the Management. Your Directors also wish to thank all the employees of the Company for their unstinted commitment and valuable contributions.

For and on behalf of Board of Directors


Place: New Delhi Ajay Kumar Choudhary

Dated: August 11, 2016 Chairman

Director’s Report