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Updated:20 Feb, 2020, 15:42 PM IST

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-1.35 -3.81%

Updated:20 Feb, 2020, 16:01 PM IST



The Members,


Your Directors are pleased to present the Thirty–Second Annual Report together with Audited Statement of Accounts of the Company for the year ended 31st March 2015.


The Board of Directors has recommended accumulated dividend subject to approval of banks of –

– Rs.3,06,11,750 on already redeemed 8% Redeemable Cumulative Preference Shares;

– Rs.37,87,397 on already converted 6% Optionally Convertible Cumulative preference shares into Equity shares


During the year under review, Net sales and services and Gross Profit before Interest and Depreciation were of Rs.834.86 Crores and Rs.86.87 Crores respectively as compared to Rs.896.38 Crores and Rs.63.03 Crores respectively for the previous year. Net sales and services of the Company have been reduced by 6.86 % but net profit has increased by 117% over the previous year.

Exports during the financial year 2014–15 were of Rs.185 Crores as compared to Rs.214 Crores during the previous year.

Turnover of the Company is reduced due to reduction in price of raw materials and finished goods following slash in price of crude oil. Concentration on high margin products, development of new products and production of BCF yarn coupled with reduction in prices of raw materials following slash in price of crude oil has increased profitability of the Company.

The Company has received in house R & D recognition for Rakholi and Palghar R & D Centers from Department of Scientific & Industrial Research.

India Rating & Research vide their letter dated May 13 2015 has assigned a Long term issuer rating and working capital facilities of IND A–; outlook stable.


The Company proposes to double its existing BCF manufacturing capacity, increase capacity of Dyeing vessel, install Nylon mother yarn line, add laboratory equipment, etc. at an estimated project cost of Rs.70 Crores which is proposed to be financed by way of internal accruals of Rs.23 Crores and term loan of Rs.47 Crores. Approvals of Banks for the term loan have been received. Implementation of the project is commenced and is likely to be completed by the end of 30th April 2016.


a) in the preparation of the annual accounts, the applicable accounting standards had been followed along with properexplanation 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 at the end of the financial year 31st March 2015 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 this Act 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;

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.


a) Mr. Atul Desai, Mr. M. K. Tandon, Ms. Mala Todarwal and Mr. K. H. Viswanathan, the independent directors have given declaration that they met the criteria of independent directors as provided in sub section 6 of Section 149 of the Companies act 2013.

b) Nomination and Remuneration committee (NRC) at their meeting held on 29th May 2014 approved and recommended policy relating to criteria for determining qualifications, positive attributes and independence of directors, the remuneration for the directors, key managerial personnel and other employees; the Board of directors approved the said policy as recommended by NRC at its meeting held on 29th May 2014.

c) NRC at their meeting held on 21st January 2015 laid down criteria for the evaluation of Board of directors. Evaluation of directors consisted of two parts i.e. quantitative data and qualitative data. The instruments was so designed that only ticks was required with no provision for descriptions, name of the directors who has evaluated is not disclosed. Evaluation took place in March 2015 and the same was discussed by the Board of directors and took remedial action at its meeting held on 30th March 2015 (Rules 8 (4) under Chapter 9 of the Companies (Accounts) Rules, 2014)

d) CSR activities is attached– Refer Annexure A

e) Meeting of Board of directors were conducted four times during the financial year 2014–15.

f) The Company is a subsidiary of Krishiraj Trading Limited.

g) Ratio of remuneration of Mr. B A Kale to the median employee's remuneration and other details as may be prescribed – Section 197 (12)

(i) the ratio of the remuneration of each director to the median remuneration of the employees of the company for the financial year; 124.66 times

(ii) the percentage increase in remuneration of Chief Financial Officer: 15%, Company Secretary:10%

(iii) the percentage increase in the median remuneration of employees in the financial year: 0%

(iv) the number of permanent employees on the rolls of company: 1535

(v) the explanation on the relationship between average increase in remuneration and company performance:

– Increase in remuneration is largely based on performance of individuals.

(vi)comparison of the remuneration of the Key Managerial Personnel against the performance of the company:

– Commission to ED and incentives to some of the executives besides fixed salary are directly related to performance of the Company

 (viii) average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration – Average increase in remuneration of employees other than managerial personnel 10% and key managerial persons – 12.50%

(ix) comparison of the each remuneration of the Key Managerial Personnel against the performance of the company – Commission @ 2.50% on net Profit to executive director and Incentives to some of KMP is directly based on performance of the Company

(x) the key parameters for any variable component of remuneration availed by the directors– 2.5% commission on Profits calculated under section 197 of the Companies act 2013 to Executive director besides fixed remuneration

(xi) the ratio of the remuneration of the highest paid director to that of the employees who are not directors but receive remuneration in excess of the highest paid director during the year– nil; and

(xii) Affirmation that the remuneration is as per the remuneration policy of the company.

h. Mr. B. A. Kale, executive director of the Company has not received any remuneration from Krishiraj Trading Limited, the holding company.

i. Details in respect of adequacy of internal financial controls with reference to the Financial Statements.

Internal financial controls are adequate and were operating effectively. The Company periodically reviews the internal controls to align it with the changing business needs and to improve governance and enhance compliance with evolving regulation.

j. Details of arrangement entered into with Welspun Wintex Limited under section 189 ( related party) is mentioned in form AOC–2 as mentioned below under Rule 8 (2) of the Companies (Accounts) Rules, 2014

Form No. AOC–2

(Pursuant to clause (h) of sub–section (3) of section 134 of the Act and Rule 8(2) of the Companies (Accounts) Rules, 2014)

Form for disclosure of particulars of contracts/arrangements entered into by the company with Related parties referred to in subsection (1) of section 188 of the Companies Act, 2013 including Certain arm's length transactions under third proviso thereto

1. Details of contracts or arrangements or transactions not at arm's length basis – No such transaction

2. Details of material contracts or arrangement or transactions at arm's length basis

(a) Name(s) of the related party and nature of relationship

– Welspun Wintex Limited

(b) Nature of contracts/arrangements/transactions

– Purchase of POY

(c) Duration of the contracts / arrangements/transactions

– 01.04.2014 TO 30.06.2014

(d) Salient terms of the contracts or arrangements or transactions including the value, if any:

– Rs.255.12 Lacs

(e) Date(s) of approval by the Board, if any:

– Board meeting dated 01.08.2014

(f) Amount paid as advances, if any:

– Nil

A. Particulars of loans, guarantees or investments under section 186.

The Company has not made investment nor given loan nor provide any guarantee for repayment of loan under section 186 of the act

B. Details of establishment of vigil mechanism for directors and employees

Clause 49(II) (F) of listing agreement.

The Company has a Whistle Blower Policy and Vigil Mechanism for its directors and employees and no personnel have been denied access to the Audit Committee.

VII. Conservation of energy, technology absorption and foreign exchangeearnings and outgo

The details of conservation of energy, technology absorption, foreign exchange earnings and outgo are as follows:

A) Conservation of energy:

(i) the steps taken or impact on conservation of energy; nil

(ii) the steps taken by the company for utilizing alternate sources of energy;

The Company has availed power partly from alternative source by entering into agreement with Daksha Infrastructure Pvt Ltd on open access basis and saved the amount of Rs.50.56 Lacs

(iii) the capital investment on energy conservation equipment’s; Nill

(B) Technology absorption:

– The Company has not entered into technical collaboration and as such not applicable.

The Research and Development capital/revenue expenditure during FY 2014–15 is Rs.760.52 Lacs.

(C) Foreign exchange earnings and Outgo:

The Foreign Exchange earned in terms of actual inflows during the year and the Foreign Exchange outgo during the year in terms of actual outflows.

FOB value of export – Rs.17292.07 lacs

CIF value of imports – Rs.19108.65 lacs


In accordance with the provisions of the Companies Act, 2013 and the Articles of Association of the Company, Mr. B. A. Kale and Mr. R. R. Mandawewala, the directors of the Company retire by rotation at the 32nd Annual General Meeting and being eligible has offered themselves for reappointment.

Mr. Abhishek Mandawewala has been appointed as an additional director w.e.f. 31.07.2015 and whole time director w.e.f. independent 01.08.2015

Mr. K. H. Viswanathan has been appointed as an additional Independent director with effect from 31.07.2015.

Board has recommended re–appointment of the aforesaid retiring directors, appointment of Mr. K. H. Viswanathan as an independent director and Mr. Abhishek Mandawewala as a director/whole time director.

Mr. Bhaskar Sen, Sr. Vice President (Accounts and Commercial) is appointed as a CFO by the Board of Directors at its meeting held on 1st August 2014.


The Audit Committee consists of the following 5 Non–Executive Directors

a. Mr. Atul Desai – Chairman

b. Mr. M. K.Tandon – Member, independent

c. Ms. Mala Todarwal – Member, independent

d. Mr. K. H. Viswanathan (w.e.f. 31.07.2015) – Member, independent

e. Mr. R. R. Mandawewala (w.e.f. 14.05.2015) – Member


The Company has not accepted any deposit within the meaning of the Chapter V to Companies Act 2013 Further, no amount on account of principal or interest on deposit was outstanding as at the end of the year under report.


Your Company's Auditors, M/s. MGB & Co, Chartered Accountants were re–appointed for the period of three years till the conclusion of 34th Annual General meeting. Members are requested to ratify their appointment from the conclusion of 32nd Annual General Meeting to the conclusion of 33rd Annual General Meeting.


A separate report on Corporate Governance is annexed hereto as a part of this Report. Management Discussion and Analysis Statement is separately given in the Annual Report. A certificate from the Auditors of the Company regarding compliance of conditions of Corporate Governance as prescribed under Clause 49 of the Listing Agreement is attached to this report.


Please refer to Auditors' Observations/ qualifications and in relation thereto the Board of directors' state as under: Auditors have qualified report under para "Basis for qualified opinion'' drawing attention to Note no. 29 of notes to the accounts and state that the Company is in the process of executing document to transfer Land to the name of the Company. The Company is in possession of Land without any interference for more than 12 years. In view of the above, the Board is of the view that no adjustment to the amounts as mentioned in note no. 29 is necessary.


A Secretarial Audit Report given by Mr. A. L. Makhija, a company secretary in practice is herewith annexed.


Board of Directors at their meeting held on 29th January 2015 considered and approved risk management policy and identified the major risk in price volatility in key raw materials.


The details of familiarization program (for independent directors) is disclosed on the Company's website and a web link thereto is <> policy.pdf


The Company has Code of Conduct for Board members and senior management personnel. A copy of the Code has been put on the Company's website for information of all the members of the Board and management personnel.

All Board members and senior management personnel have affirmed compliance of the same.


Details of the every employee of the Company as required pursuant to Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is herewith attached.


Your Directors take this opportunity to express gratitude for valuable assistance and co–operation extended to the Company by Financial Institutions, Commercial Banks and other authorities. Your directors also wish to place on record their sincere appreciation of the dedicated services, hard work, solidarity and profuse support by all the employees of the Company.


R. R. Mandawewala


B. A. Kale

Executive Director Mumbai,

Date: 31st July 2015