22ND DIRECTORS' REPORT FOR THE YEAR ENDED 31ST MARCH, 2006.
Your Directors have pleasure in presenting herewith the 22nd Annual Report
together with the Audited Statement of Accounts for the year ended on 31st
FINANCIAL RESULTS (Rs. In Lacs)
Particulars Year ended Previous year
31-3-2008 ended 31-3-2005
(a) Profit for the year before
Depreciation and Financial Expenses 1107.58 829.29
(b) Less: Depreciation 245.83 251.01
Financial Expenses (Net) 295.58 412.15
(c) Profit before Exceptional & Prior Year Items 566.07 166.13
(d) Prior year's Adjustments (Net) (1 05) (3.95)
(e) Exceptional Items 0.00 (21.66)
(f) (Short)/Excess Provision of Tax of
Earlier Years (Net) 0.60 (5.17)
(g) Profit before tax 565.62 135.35
(h) Provision for Tax
-Current 114.00 28.00
- Deferred Tax 69.26 (33.57)
- Fringe Benefit Tax 12.50 0.00
(i) Net Profit after Tax 369.86 140.92
(1) Profit brought forward 388.88 288.94
Amount available for appropriation 758.74 429.86
- Proposed Dividend 71.88 35.94
- Tax on Proposed Dividend 10.08 5.04
- Transfer to General Reserves 421.07 0.00
- Balance carried to Balance Sheet 255.71 388.88
Total 758.74 429.86
The Directors have recommended dividend of 10 % on 71,88,230 Equity Shares of
Rs. 10/- each of the Company for the financial year ended on 31st March, 2006 as
compared to 5% declared for the previous financial year ended on 31st March,
2005. This will absorb Rs. 71.88 lacs as against Rs. 35.94 lacs absorbed in the
previous year. The corporate dividend tax payable by the Company on the said
dividend will be Rs. 10.08 lacs as against Rs. 5.04 lacs in the previous year.
If approved, the dividend will be paid without deduction of tax at source to
those shareholders whose names appear in the Register of Members of the Company
as on 27th September, 2006.
MANAGEMENT DISCUSSION AND ANALYSIS
Management Discussion and Analysis Report has been enclosed herewith as per
Annexure A and forming part of the Directors' Report.
in line with the requirements of Listing Agreement with the Stock Exchanges and
the Accounting Standards of the Institute of Chartered Accountants of India,
your Company has made additional disclosures in the Notes on Accounts for the
year under review in respect of Related Party Transactions, Segmental Reporting
(in Notes on Consolidated Accounts), Calculation of EPS, Deferred Tax Liability,
QUALITY ASSURANCE AND SYSTEMS
ISO 9001:2000 CERTIFICATES
Your Company has always made continuous efforts to improve the process of
manufacturing and to achieve quality and efficiency in each of its operations.
This is evident from the award of ISO 9001:2000 to the Company conferred upon by
Underwriters Laboratories Inc., USA for its Processed Foods Division situated at
Dharampur, Dist. Valsad, Gujarat. The Company has also HACCP certification for
the same. The division has also achieved Export House status from Government of
India in 1994. The division has also won the award of Certificate of Merit from
APEDA, New Delhi for commendable performance in export of processed food
The Company has also ISO 9001:2000 certification and HACCP Certificate from
Bureau of Indian Standard (BIS) for its ice cream plant at Bareilly in the
States of Uttar Pradesh. The Company has also ISO 9001:2000 certification and
HACCP Certificate from BVQI, Netherland for its ice-cream plant at Pundhra in
the State of Gujarat. The plant has also been certified by Export Inspection
Council of India.
During the year under review, your Company has saved interest cost by settling
the full and final payment to IIBI.
The Consortium Banks, namely, BOB, SBI, SBT, SIB, Exim Bank and IDBI Ltd. have
enhanced the Working Capital limits from Rs. 2202 lacs (includes Fund-based
limit of Rs. 1706 lacs and Non-fund based limit of Rs. 496 lacs) to Rs. 3004
lacs (includes Fund-based limit of Rs. 2563 lacs and Non-fund based limit of Rs.
441 lacs). Further, all Consortium Banks, have sanctioned their shares of
enhanced Working Capital limits. Exim Bank has renewed the existing Working
Capital limit of Rs. 100 lacs with further enhancement of Rs. 100 lacs, making
the total limits of Rs.200 lacs. IDBI Ltd. has entered into the Consortium by
sanctioning Working Capital limits of Rs. 250 lacs.
Your Company is also enjoying the Gold Card issued by BOB, a Lead Bank, for the
Exports Oriented Unit (EOU) since May, 2005.
In terms of the provisions of Investor Education and Protection Fund (IEPF)
Rules, 2001, during the financial year 2005- 2006, the Company has transferred
the unclaimed debenture redemption and interest amount of Rs. 2,42,567.91
(including interest amount of Rs. 27,529/- on fixed deposit) and unclaimed
debenture interest amount of Rs. 44,484.83 (including interest amount of Rs.
4,817/- on fixed deposit) to IEPF established by the Government under Section
205C(1) of the Companies Act, 1956.
The Company has no overdue deposits outstanding other than those unclaimed
deposits of Rs. 19.77 lacs as on 31st March, 2006. As on date of this Report,
deposits aggregating Rs. 8.75 lacs thereof have been claimed and paid or
renewed. The Company has mobilised Fixed Deposit of Rs. 500.54 lacs during the
year ended on 31st March, 2006, after complying with the provisions of Section
58 A of the Companies Act, 1956 read with the Companies (Acceptance of Deposits)
Rules, 1975 as amended. After repaying the maturities during the year, the total
Fixed Deposits as on 31st March, 2006 stood at Rs. 676.19 lacs.
As a Listed Company, necessary measures are taken to comply with the Listing
Agreement with the Stock Exchanges including revised Clause 49 regarding
Corporate Governance. A separate report on Corporate Governance for the year
ended on 31st March, 2006 is produced as a part of this Annual Report..A
certificate from Statutory Auditors of the Company regarding compliance of
Corporate Governance as stipulated under revised Clause 49 of Listing Agreement
shall be obtained by the company and will be annexed to the Directors' Report.
To the best of their knowledge and belief and according to the confirmation and
explanations obtained by them, your Directors make the following statement in
terms of Section 217(2AA) of the Companies Act, 1956 and confirm:
a) that in the preparation of Annual Accounts, the applicable accounting
standards have been followed and that no material departures have been made from
b) that they have selected such accounting policies and applied them
consistently and made judgements 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 31st March, 2006 and of the profit or loss of the
Company for that year;
c) that 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;
d) that they have prepared the Annual Accounts on a going concern basis.
All insurable interests of the Company including buildings, plant and machinery,
furniture & fixtures and other insurable interest are adequately insured.
CONSOLIDATED FINANCIAL STATEMENTS
As stipulated by Clause 32 of Listing Agreement with Stock Exchanges,
Consolidated Financial Statements of the Company and its Associates, namely,
Vadilal Cold Storage, a Partnership Firm and Vadilal Chemicals Limited, an
Associate Company for the year ended on 31st March, 2006 have been prepared by
the Company in accordance with the requirements of Accounting Standard 21
Consolidated Financial Statements and Accounting Standard 23 Accounting for
investments in Associates issued by the Institute of Chartered Accountants of
India. The Audited Consolidated Financial Statements form part of the Annual
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND
As required under Section 217(1)(e) of the Companies Act, 1956 read with the
Companies (Disclosure of Particulars in Report of Board of Directors) Rules,
1988, details relating to Conservation of Energy, Technology Absorption and
Foreign Exchange Earnings and Outgo are given in the Annexure B attached
hereto and forming part of the Directors' Report.
LISTING AGREEMENT WITH STOCK EXCHANGES
Pursuant to the provisions of Listing Agreement with the Stock Exchanges, the
Company declares that the Equity Shares of the Company are listed on the Stock
Exchanges at Ahmedabad and Mumbai.
The Company confirms that it has paid Annual Listing Fees due to the Ahmedabad
and Mumbai Stock Exchanges upto the financial year 2006-07.
PARTICULARS OF EMPLOYEES
As required under Section 217(2A) of the Companies Act, 1956 read with the
Companies (Particulars of Employees) Rules, 1975 as amended, the particulars of
the concerned employees are given in Annexure C which is attached hereto and
forms part of the Directors' Report.
Pursuant to the provisions of the Companies Act, 1956 and Articles of
Association of the Company, Shri C.M. Maniar and Shri Kshitish M. Shah,
Directors of the Company, retire by rotation at this Annual General Meeting, and
being eligible, offer themselves for re-appointment. Members are requested to
consider their re-appointment as Directors of the Company, for which necessary
resolutions have been incorporated in the notice of the meeting. The brief
resume/details relating to the said Directors who are to be re-appointed are
furnished in the Notes to the Notice of the Annual General Meeting.
Regarding Auditors' comments in the report, these are dealt with by Notes on
Accounts No. 4 in Schedule 3.2, which is self explanatory and therefore do not
call for any further clarifications under Section 217(3) of the Companies Act,
M/s. Kantilal Patel & Co., Chartered Accountants, Ahmedabad, hold office as
Statutory Auditors of the Company until the conclusion of this Annual General
Meeting and as recommended by Audit Committee, the Board recommends their
re-appointment till the conclusion of the next Annual General Meeting. The
Company has received a certificate from the said Auditors under Section 224(1)
of the Companies Act, 1956 to the effect that their re-appointment, if made,
would be within the prescribed limits under Section 224(1B) of the Act. Members
are requested to consider their re-appointment as Statutory Auditors of the
Company for the current year at a remuneration to be decided by the Board of
The Directors place on record the appreciation and gratitude for the
co-operation and assistance extended by various departments of the Union
Government, State Government, Bankers and Financial Institutions.
The Directors also place on record their appreciation of dedicated and sincere
services of the employees of the Company at all levels
The Company will make every effort to meet the aspirations of its Shareholders
and wish to sincerely thank them for their whole hearted co-operation and
support at all times.
Signed on : 31st July, 2006