The Directors are pleased to present their third Annual Report on the
business and operations of your Company for the year ended 31st March,
(Rs in lakhs)
Particulars Year ended Year ended
31st March, 2008 31st March, 2007
Gross sales 79292.22 72037.26
Gross profit 5969.23 8692.48
Less: Depreciation 5330.61 4241.50
- Current 67.39 495.39
- Earlier years (0.55) 86.35
- Deferred 220.40 192.43
- Fringe Benefit tax 47.96 45.32
Net profit 303.42 3631.49
Add: Balance brought forward from
the previous year 5375.12 2681.79
Total 5678.54 6313.28
Proposed dividend 109.22 491.48
Corporate dividend tax 18.56 83.53
Transfer to the general reserve - 363.15
Balance in profit and loss a/c.
carried to balance sheet 5550.76 5375.12
Total 5678.54 6313.28
Your Directors take pleasure in recommending a dividend of 10% (Re.1/-
per share) for the year ended 31st March, 2008, subject to
shareholders approval at the forthcoming Annual General Meeting.
Shareholders whose names stand registered on the register of members at
the close of the market hours on 26th September, 2008 would be entitled
for the dividend. The total amount of dividend to be paid to the
shareholders will be Rs 127.78 lakhs (inclusive of dividend tax).
Your Company undertook expansion and modernisation initiatives,
reinforcing the existing competitive advantage. The Company completed
various expansion and modernisation projects to upgrade technology and
enhance the operational scale across its various units through the
- The expansion at Bhawanimandi unit by 7,488 spindles to manufacture
PV dyed yarn was completed; commercial production commenced during the
last quarter of 2007-08.
- ERP: The Company implemented ERP (Enterprises Resources Planning)
during the year;
Addition of 3 MW Captive Power Plant at Bhilad at a capital outlay of
Rs 16 crore was completed.
The Company invested Rs 172 crore during the year 2007-08, which
include expenditure on the above projects.
Future Capital Investments
As part of its ongoing investments in state-of-the-art equipment to
manufacture quality products the Company undertook the following
projects at a capital outlay of Rs 288 crore:
Spinning: Embarked on the addition of 43776 spindles by the third
quarter of the financial year 2008-09 at a capital outlay of Rs 176
crore. The Company postponed the project of 24768 spindles with a
capital outlay of Rs 105 crore till the market conditions improve.
Captive Power Generation: Embarked on the addition of a total of 18 MW
captive thermal power plants in Bhawanimandi at a total cost of Rs 70
crore. The project is progressing satisfactorily and expected to
commence by Q3 FY 09.
Modernisation: Embarked on the enrichment of the product mix through
technology upgradation and modernisation. The Company intends to invest
Rs 42 crore over the next two years.
These capital projects are financed by internal accruals and loans from
banks under the Technology Upgradation Fund Scheme under which interest
subsidy of 5% p.a. is given by the Government.
At the end of the financial year under review, fixed deposits from the
public, shareholders and employees amounted to Rs 1233.35 lakhs;
deposits amounting to Rs 1.90 lakhs remained unclaimed as on 31st
Particulars of Employees
Information pursuant to the provisions of Section 217 (2A) of the
Companies Act, 1956, read with Companies (Particulars of Employees)
Rules, 1975, as amended, are given in Annexure-I, which forms a part of
Energy Conservation, Technology Absorption and Foreign Exchange
Earnings and Outgo
Information pursuant to the provisions of Section 217(1)(e) of the
Companies Act, 1956, in relation to conservation of energy, technology
absorption and foreign exchange earnings and outgo are given in
Annexure-ll, which is a part of this report.
Management Discussion and Analysis Report
The detailed review of the operations, performance and outlook of the
Company is given separately in Annexure-lll in the Management
Discussion and Analysis section, forming a part of this report.
Your Company is committed to ethics and governance, resulting in
enhanced transparency for the benefit of stakeholders. As per revised
Clause 49 of the Listing Agreement with stock exchanges, it adopted a
code of conduct applicable to the Board and senior management. The
Company fully complies with the governance practices as enunciated in
the Listing Agreement and its review of the corporate governance report
forms a part of this report.
Compliance of Accounting Standards
As per requirement of the Listing Agreement with stock exchanges and
accounting standards of the Institute of Chartered Accountant of India,
your Company has made disclosure in respect of Related Party
Transactions and Deferred Taxation. The Company duly adopted all the
accounting standards in pursuance to the provision of Section 211 (3A)
of the Companies Act, 1956.
Directors Responsibility Statement
Your Directors hereby confirm that:
(i) In the preparation of the annual accounts, the applicable
accounting standards were followed along with proper explanations
relating to material departures, and the Notes in the Auditors report
in this regard are self- explanatory;
(ii) Such accounting policies were selected and applied consistently
and judgements and estimates were made that were 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 profit of the
Company for the year ended 31st March, 2008;
(iii) Proper and sufficient care were 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 fraud and other irregularities;
(iv) The annual accounts were prepared on a going concern basis;
Under Article 139 of the Articles of Association of the Company, Mr. C.
S. Nopany, Mr. J. S. Varshneya and Mr. S. M. Agarwal, Directors of
the Company, retire by rotation and are eligible for re- appointment.
Mr. K. R. Podar was appointed as an Additional Director at the Board
Meeting held on 29th October, 2007. The term of his office extends up
to the date of this Annual General Meeting. Notices have been received
in writing under provisions of Section 257 of the Companies Act, 1956,
proposing the candidature of Mr. K. R. Podar for the office of the
Director of the Company. Your Directors recommend the appointment for
The Audit Notes in the Auditors report are self-explanatory and need
no further clarifications.
M/s. Singhi & Co., Auditors and M/s. S.R. Batliboi & Co., Branch
Auditors retire at the conclusion of Annual General Meeting and are
eligible for re- appointment.
Your Directors place on record their deep appreciation to the devoted
officers, staff and workers who have contributed significantly for
Companys performance and for enhancing its inherent strength. Your
Directors are also grateful for the co-operation and assistance
received from financial institutions and banks during the year under
For and on behalf of the Board
Place : New Delhi Dr. K.K. Birla
Dated : 30th June, 2008 Chairman