Annual Report 2007-Cover

Transcription

Clariant Chemicals (India) Limited
Name of the Stock Exchange
Stock Code No.
ISIN
BSE
CLARICHEM
INE492A01029
NSE
CLNINDIA
INE492A01029
Address for correspondence
Registrar & Share Transfer Agents :
Company :
M/s Sharepro Services (India) Pvt. Ltd.
Satam Estate, 3rd Floor
Above Bank of Baroda
Chakala, Andheri (E)
Mumbai – 400 099
Tel: 2821 5168 / 69
Fax: 2837 5646
e-mail ID under Clause 47 (f) of Listing agreement
[email protected]
Ravindra Annexe
194, Churchgate Reclamation
Mumbai – 400 020.
Tel: 2202 2161
Fax: 2202 9781
Contact Person:
Contact Person: Mr. Satish P. Bhattu
Asst. Company Secretary
Mrs. Indira Karkera/
Mr. B. Dinkar
Annual General Meeting
Day and Date
:
Thursday, April 19, 2007
Time
:
04.00 p.m.
Venue
:
Y. B. Chavan Auditorium
General Jagannath Bhosale Marg
Next to Sachivalaya Gymkhana
Mumbai – 400 021
April 5, 2007 to April 19, 2007 (Both days inclusive)
Book Closure Dates :
Co
rpora
te Information
Corpora
rporate
BOARD OF DIRECTORS
Mr. R. A. Shah – Chairman
Mr. H. Meier – Vice-Chairman & Managing Director
Mr. B. S. Mehta
Diwan A. Nanda
Mr. K. J. Bharucha
Mr. P. Lindner
Dr. A. Walde
Mr. W. Mohr
CHIEF FINANCIAL OFFICER & COMPANY SECRETARY
Mr. Sunil K. Nayak
AUDIT COMMITTEE
Mr. R. A. Shah – Chairman
Diwan A. Nanda
Mr. K. J. Bharucha
INVESTORS’ GRIEVANCE COMMITTEE
Diwan A. Nanda – Chairman
Mr. H. Meier
BOARD COMMITTEE
Mr. K. J. Bharucha – Chairman
Mr. H. Meier
MANAGEMENT COMMITTEE
Mr. H. Meier – Chairman
Mr. Sunil K. Nayak
Mr. A. K. Prasad
Dr. G. G. Patkar
Dr. S. Siddhan
Mr. S. S. Patil
AUDITORS
A. F. Ferguson & Co., Chartered Accountants
INTERNAL AUDITORS
Mahajan & Aibara, Chartered Accountants
SOLICITORS
Crawford Bayley & Co.
BANKERS
The Hongkong & Shanghai Banking Corpn. Ltd.
Standard Chartered Bank
Citibank N.A.
REGISTERED OFFICE
Ravindra Annexe
Mumbai-400 020
WORKS
Dhatav, Roha, Dist. Raigad-402 116
Balkum, Thane-400 608
Kolshet Road, Thane-400 607
Kudikadu, SIPCOT P. O., Cuddalore-607 005
Singadivakkam Village, Kanchipuram-631 561
REGISTRAR & SHARE TRANSFER AGENTS
Sharepro Services (India) Pvt. Ltd.
Satam Estate
Mumbai-400 099
1
No
Nott ice
NOTICE is hereby given that the Fiftieth Annual General
Meeting of the Members of Clariant Chemicals (India
(India)
Limited will be held at Y. B. Chavan Auditorium,
General Jagannath Bhosale Marg, Next to Sachivalaya
Gymkhana, Mumbai – 400 021 on Thursday, April 19, 2007 at
04.00 p.m. to transact the following business:
Notes:
1.
Proxies in order to be effective, should be duly
completed, stamped and must be received at the
registered office of the Company not less than 48 hours
before the meeting.
Ordinary Business:
1.
To consider and adopt the Balance Sheet as at
December 31, 2006 and the Profit and Loss Account
for the period of nine months ended on that date
together with the Reports of the Directors and Auditors
thereon.
2.
To declare a dividend.
3.
To appoint M/s. A. F. Ferguson & Co., Chartered
Accountants, as the Auditors of the Company to hold
office from the conclusion of this Annual General
Meeting upto the conclusion of the next Annual
General Meeting and to authorise the Board of
Directors to fix their remuneration.
4.
To appoint a Director in place of Mr. R. A. Shah, who
retires by rotation and being eligible, offers himself for
re-appointment.
5.
To appoint a Director in place of Mr. P. Lindner, who
re-appointment.
6.
To appoint a Director in place of Diwan A. Nanda, who
re-appointment.
By Order of the Board
For Clariant Chemicals (India) Limited
2.
Profiles of the Directors being reappointed as
required under clause 49 of the listing agreement are
provided in the report on Compliance of Corporate
Governance.
3.
The Register of Members and Share Transfer Books of
the Company will remain closed from Thursday, April 5,
2007 to Thursday, April 19, 2007, both days inclusive, for
the purpose of payment of dividend, if declared at the
Annual General Meeting.
4.
The dividend on shares as recommended by the
Board of Directors, if declared at the meeting, will be
paid:
(i)
5.
The amount outstanding in unpaid dividend account in
respect of financial year 1999-2000 will be transferred
to the ‘Investor Education and Protection Fund’
maintained with the Central Government after the end
of 7 years in April, 2007. Members who have still not
encashed their dividend are requested to do so at the
earliest.
6.
In case of any change of particulars including
address, bank mandate and nomination for shares
held in demat form, should be notified only to the
respective Depository Participants where the member
has opened his/her demat account. The Company or its
February 22, 2007
2
in respect of shares held in demat form, on the
basis of beneficial ownership as per details
furnished by the Depositories, as at the end of the
business on April 4, 2007 and
(ii) in respect of shares held in physical form to those
members whose names appear on the Register of
Members of the Company after giving effect to all
valid share transfers lodged with the share
transfer agent on or before April 4, 2007. The
Company will dispatch the dividend warrants on or
after April 20, 2007.
Sunil K. Nayak
Chief Financial Officer
& Company Secretary
Registered Office:
Ravindra Annexe
Mumbai 400 020
A MEMBER ENTITLED TO ATTEND AND VOTE
AT THE MEETING IS ENTITLED TO APPOINT A
PROXY TO ATTEND AND VOTE INSTEAD OF HIMSELF
AND THE PROXY NEED NOT BE A MEMBER OF THE
COMPANY.
Notice
share transfer agent will not act on any direct request
from these members for change of such details..
However requests for any change in particulars in
respect of shares held in physical form should be sent
to the Registrars & Share Transfer Agents of the
Company.
7.
Members holding shares in demat form may please
note that the bank account details given by them to
their Depository Participants (DPs) and passed on to
the Company by such DPs would be printed on the
dividend warrants of the concerned members.
However, if any member(s) wants to receive dividend in
any other bank account, he/she should change/
correct the bank account details with his/her
concerned DP. The Company will not be able to act on
any such request from shareholders directly for
deletion/change in the bank account details.
8. Members may please note that the dividend warrants
are payable at par at the designated branches of the
Bank printed on the reverse of the dividend warrant for
an initial period of three months only. Thereafter, the
dividend warrant on revalidation is payable only at
limited centres/branches of the said bank. The
members are therefore, advised to encash dividend
warrants within the initial validity period.
9. Copies of Annual Reports will be sent to those members
whose names appear on the Register as on March 9,
2007. The members who acquire shares thereafter
are requested to collect their copies from the
Registered Office of the Company.
10. Members who wish to attend the meeting are
requested to bring attendance slip sent herewith, duly
filled in, and the copy of the annual report. Copies of the
annual report will not be distributed at the meeting.
3
Directors’ Report to the Members
The Directors present herewith their Fiftieth Annual Report
and the Audited Statement of Accounts of the Company for
the nine months period ended December 31, 2006.
1.
and practices, rationalise areas of overlap and
duplication and reap the benefit of synergies. This was
largely achieved through continuous and open
communications and personal interaction at all levels
by the senior management team of the Company.
Performance of the Company
April 2006 to April 2005 to
December 2006 March 2006
Rs. lakhs
Rs. lakhs
Turnover
Other Income
Total Revenue
68704
2432
71136
85596
2813
88409
Profit before Interest,
Depreciation and Tax
Interest
Depreciation
6605
7
(1535)
8935
(4)
(2447)
5077
6484
(1250
(1250)
(456)
(85)
(2238)
(38)
(228)
Profit before Tax
Provision for Taxation
— Current Tax
— Deferred Tax
— Fringe Benefit Tax
— Excess provision for
taxation in respect of
earlier years
Profit after Tax
Balance brought forward
from previous year
Amount available
for appropriation
The Directors have
made the following
appropriations therefrom:
(a) General Reserve
(b) Proposed dividend
(c) Corporate Tax on
Proposed Dividend
Balance carried
forward to Balance
Sheet
—
59
3286
4039
3866
4171
7152
8210
330
4799
1000
2933
673
411
1350
3866
The integration efforts culminated with the successful
implementation of the SAP WINS system across all the
businesses, sites and locations. SAP WINS is the
system that is used globally by Clariant and after going
live on January 4, 2007, Clariant Chemicals (India)
Limited is in a position to reap the numerous ongoing
benefits of being part of the global system.
4.
In the context of the mandatory requirement to present
consolidated accounts, which provides members with
a consolidated position of the Company including its
subsidiaries, at the first instance, members are being
provided with the report and Accounts of the Company
and the consolidated accounts as contemplated by
Section 219 of the Companies Act, 1956 and Accounting
Standard 21 issued by the Institute of Chartered
Accountant of India. Members who wish to receive the
full Report and Accounts including the Report and
accounts of the subsidiary will be provided with upon
receipt of a written request.
5.
3.
4
Change of Accounting Year
The accounting year has been changed from AprilMarch to January-December. Therefore, the accounts
have been drawn up for nine months for the period
ended December 31, 2006.
Post-Merger Integration Process
The Company achieved significant success in unifying
the former subsidiaries into a single integrated
organisation. Without compromising its focus on its
markets and customers, the Company was able to
integrate its businesses, adopt uniform processes
Dividend
The Board of Directors is pleased to recommend for the
approval of shareholders, a dividend of Rs. 18/- per
equity share of the face value of Rs. 10/- each including
a ‘Golden Jubilee’ special dividend of Rs. 10/- per
equity share.
This would involve a cash outflow of Rs. 5472 lakhs
including tax on dividend of Rs. 673 lakhs against the
previous year outflow of Rs. 3344 lakhs including tax on
dividend of Rs. 411 lakhs. The dividend, if approved, will
be paid to the shareholders whose names appear on
the Register of Members, determined with reference to
the book closure from April 5, 2007.
Note: Figures for the current period are for nine months and
therefore are not strictly comparable with the previous
period of twelve months.
2.
Subsidiary Company
The Statement pursuant to Section 212 of the
Companies Act, 1956, relating to wholly-owned
subsidiary of the Company, viz., Chemtreat Composites
India Private Limited, is attached along with the
Accounts of the Company.
6.
Finance
6.1 Term Loan
No long term loan was taken during the year. Term
loan of Rs.125 lakhs was repaid during the year.
6.2 Fixed Deposits
As at December 31, 2006 an aggregate of Rs.1.28
lakhs representing 18 deposits which had
remained unpaid pending instructions from the
depositors concerned.
Directors’ Report
As per requirements of Section 205C of the Companies
Act, 1956 the fixed deposits and interest unclaimed
after completion of seven years is transferred to
the Investor Education and Protection Fund (IEPF)
established by the Central Government. There is no
amount due and outstanding to be credited to Investor
Education and Protection Fund.
MANAGEMENT DISCUSSION AND ANALYSIS
7.
Financial and operational performance
7.1 The performance and the key ratios of the
Company is provided in the following table:
(Rs in lakhs)
Sr.
No.
April 2006 to
December 2006
April 2005 to
March 2006
68704
85596
1.
Turnover
2.
Other Income
2432
2813
3.
Total Revenue
71136
88409
4.
Total Expenditure
(excluding Interest &
Depreciation)
64531
79474
5.
PBDIT (3-4)
6605
8935
6.
Depreciation
1535
2447
7.
Interest
8.
9.
10.
(7)
4
PBT (5-6-7)
5077
6484
Taxes
1791
2445
PAT (8-9)
3286
4039
7.2 (a) Intermediates and Colours
The Company deals in pigment dyestuffs
and their dispersions, intermediates for dyes,
pesticides and pharmaceuticals. The Company
has a strong presence in organic pigments and
serves the needs of the paints, printing inks,
plastics, rubber, detergents, cosmetics and
other industries. It is a leader in diketene
chemistry and has the capacity to manufacture
large volumes of this important building block,
in a wide range of derivative forms. It is
therefore a pre-eminent player in the diketene
based intermediates business in India.
The total sales under this segment for the
nine months period were Rs. 25563 lakhs.
Export sales have contributed 44 per cent of
the overall sales. Pigment dyestuffs and
intermediates for dyes constitute 90 per cent
of the total sales under this segment.
(b) Dyes and Specialty Chemicals
Clariant’s specialty chemicals help enhance
the performance, look and feel of the final
products of its customers and add protection
and strength to such products.
Textile, leather, paper, detergents and cleaning,
personal care products are amongst the
numerous end uses that are served by the
Company with a wide range of specialty
chemicals.
The total sales under this segment for the
nine months period was Rs 41351 lakhs
contributing 60 per cent in the total sales of
the Company.
Note: Figures for the current period are for nine months and therefore are
not strictly comparable with the previous period of twelve months.
Key Ratios
Sr.
No.
April 2006 to
December 2006
April 2005 to
March 2006
1.
PBDIT/Total Revenue (%)
9.29
10.11
2.
PBT/Total Revenue (%)
7.14
7.33
3.
PAT/Total Revenue (%)
4.62
4.57
4.
EPS (Rupees)
12.33
15.15
(Not annualised)
(Annualised)
5.
ROCE (%) Annualised
13.85
10.41
6.
Debt/Equity Ratio
0.02
0.17
7.
Inventory Turnover
(No. of times) Annualised
7.15
6.83
NWC/Total Revenue (%)
Annualised
10.86
12.96
8.
7.2 Segment-wise Performance:
The specialty chemicals industry comprises of a
wide range of products from textile dyes and
chemicals, leather dyes and chemicals, paper
chemicals, rubber chemicals, masterbatches,
pigments, additives, electronic chemicals, fine
chemicals, water treatment chemicals, adhesives
etc.
(c) Masterbatches
The Masterbatches segment of the Company
deals in colour and additive concentrates and
special mixtures of these compounds for use
by the automotive, textile and technical fibers,
electronic and electrical devices, home
appliances, toys, medical devices, sporting
goods and packaging. The segment has
recorded sales of Rs. 1790 lakhs.
Segment wise performance
(Rs in lakhs)
April 2006 to
December 2006
%
April 2005 to
March 2006
%
Intermediates
and colours
25563
37
35510
41
Dyes and Specialty
Chemicals
41351
60
48401
57
1790
3
1685
2
Masterbatches
Total
68704 100
85596 100
5
8.
9.
6
Industry Structure and Development
With revenues of approximately US$ 28 billion, the
chemical industry in India constitutes 6.7% of GDP
and 10% of exports. By 2010, it aspires to achieve
a size of US$ 100 billion. The Indian specialty chemicals
segment is worth US$ 7 billion and according to a
KPMG report has the potential to grow to US$ 27 billion
by 2010. Most specialty chemical companies in
India operate in textile dyes and chemicals, leather
dyes and chemicals, paper chemicals, rubber
chemicals, masterbatches, pigments, additives,
electronic chemicals, fine chemicals, polymerisates,
pharmaceutical intermediates, adhesives and water
treatment chemicals.
The specialty chemicals sector is characterised by
an innovation culture that regularly develops and
launches new high value functional chemicals. The
producers are customer-focused and aim to provide
unique products that give their customers a distinct
advantage or benefit. The dyestuffs segment has
traditionally been one of the largest in the industry and
continues to be crucial because of its forward and
backward linkages with a number of other industries.
However, the bulk of the action is in the textile
pre-treatment and finishing chemicals areas, where
profitability is governed by constant innovation and
new product development.
Opportunities and Threats
With its strong technical skills and low cost
manufacturing, India is fast becoming a preferred
outsourcing choice for knowledge based chemicals. It
has the ability to be a large player in the global
specialty chemicals industry and a dominant player in
select segments such as pharmaceuticals, custom
manufacturing and contract research. The specialty
chemicals industry is continuously faced with a
price-cost squeeze due largely to the relentless
increase in raw material and energy costs. In its
attempt to be a global player, the industry is trying to
build distinctive customer service competencies and
become cost efficient.
The laws regarding safety, health and environment
standards are becoming increasingly stringent every
day. Various new retailer standards, as well as the
new legislation, the Registration Evaluation and
Authorisation of Chemicals (REACH) require a plethora
of data to be provided by companies engaged in
international trade. Exporters, particularly those in the
textile and leather industry are increasingly requiring
chemical manufacturers to provide adequate
certification that their products are fully compliant with
all statutory requirements. The Company has invested
Rs. 35 million to set up a world class Product Safety
Laboratory with excellent testing facilities and
processes that enable it to undertake a comprehensive
range of tests encompassing process tests, ecological
tests and test for banned and restricted substances.
These tests cover the entire gamut of post
manufacturing hazards of products – such as during
drying, milling, packing, storage, transport and ultimate
use at the customers’ facilities.
10. Outlook
The Indian economy, with an expected growth rate of
around 9.2% in 2006-07 is amongst the fastest growing
in the world. According to a recent update of the
Goldman Sach’s BRIC’s report, productivity growth will
help India sustain over 8% growth until 2020 and make
its economy the second largest in the world, ahead of
the US, by 2050. India’s per capita GDP in dollars will
quadruple from 2007 to 2020. Such a scorching growth
forecast spells improved demand for consumer goods
such as textiles, leather, paints as also for automobiles,
housing, construction, packaging and other industrial
sectors and will lead to a sharp increase in demand for
specialty chemicals. With all the main markets that the
Company services showing strong growth impulse, the
future outlook for most of our businesses will continue
to be encouraging.
Textile: The textile and clothing industry is valued at
US$ 46 billion and is projected to grow to US$ 85 billion
by 2010. There has been regular increase in
investments in the textile sector during the last two to
three years and investments in the year 2006 are
estimated to reach a level of US$ 6 billion.
The apparel industry is already the largest foreign
exchange earning sector, contributing 12% of the
country’s total exports. The 10% cap on Chinese textile
exports to the US will continue till 2008 and is expected
to afford India a window of advantage. Many of the
world’s leading brands are sourcing products from
India and the country has clearly emerged as a
flourishing outsourcing centre for the textiles and
apparel industries to meet global requirements. India is
poised to strengthen its position as a player in home
textiles with an over three fold jump expected in
exports by 2010. It’s home textile exports are
forecasted to rise to US$ 10 billion by 2010 from US$ 3
billion in 2005.
Leather: The leather industry has seen good growth in
the past, as the government has developed policies to
boost exports of leather. The Council for Leather
Exports expects exports to cross US$ 3 billion mark in
2006-07 and has set a target of US$ 7 billion for 2010-11.
The council has strengthened its marketing efforts and
the main areas of growth for 2007 are expected to be in
shoe uppers and upholstery. There has been a positive
response from Italian, Chinese and Taiwanese
companies for investing in shoe and leather goods
manufacturing units.
Directors’ Report
Paper: The paper industry in India is highly fragmented
with only about 45% of the market controlled by
organised players. No green field expansion projects
are expected shortly but all the major big paper mills
are expanding the capacity of their existing plants.
Demand for paper has been rising steadily over the
past few years, in the wake of the booming economy,
as consumer spending on education, newspapers and
packaged consumer products increases. India has a
per capita consumption of paper of about 7 kg. as
compared to more than 30 kg. in China and 300 plus kg.
in the United States. Collectively, the Indian paper
industry amounted to approximately 7.2 million tonnes
in 2005-06. The industry is expected to grow at over
10% in the financial year 2008.
Paints: The Indian paints industry currently valued at
US$ 2 billion expects strong growth from the
construction and housing sector to keep industry
players buoyant in the years ahead. It has helped the
industry attain an average growth of 8 - 9% in the last
four years. The decorative paints segment is likely to
grow at 30% driven by the construction and housing
boom. The per capita consumption of paints in India is
very low at about 0.5 kg. per annum when compared
with 4 kg. per capita in south-east Asian nations and
22 kg. in developed countries.
India, a predominantly decorative paints market,
has also been seeing a big growth in the industrial
paints segment propelled by the surge in automobile
buying. Indian automobile makers currently make one
million automobiles per year and this segment
accounts for 50% of the demand for industrial paints.
Consumer buying of various other goods is going up. Be
it floor coatings for the pharmaceutical or foods
industry, road marking paints, high performance
coatings for the petrochemical and other related
sectors, powder coating for doors — off take of all
these paints is moving upward and providing good
prospects for our organic pigments, additives and
biocides for coatings.
Packaging: The packaging industry is serviced by the
pigments, additives and masterbatches businesses.
Increased affluence has made more products
affordable to a larger section of the population. The
newfound prosperity and changing life styles has
resulted in a booming market for convenience
products, both in the foods and non-foods sectors. This
in turn has led to a growing market for convenient
packing materials, easy-to-pour dispensing caps etc.
With Indians becoming more health conscious, there is
also a move towards packaged, branded products
rather than the unpackaged formats. The packaging
industry has good potential and over the next five years
is expected to grow at 8 to 10% per annum. The Indian
market for packaging materials is estimated at around
Rs. 400 billion per annum. Of this, the consumer
packaging market of the country is valued at around
Rs. 180 billion.
Construction: In order to sustain an 8% annual growth
rate, the country will need, among other things, robust
and world-class infrastructure. Overall, infrastructure
investments are expected to rise from Rs. 1,700 billion
in the financial year 2005 to Rs. 2,200 billion by
the financial year 2008. Of this, the roads sector
is expected to contribute as much as 34%, or
Rs. 757 billion. The roads sector is one that is expected
to see the maximum action in the infrastructure
segment.
11. Threats, Risks and Concerns
The risk framework involves identifying risks across
each of the business processes of the Company.
As with any business organisation, the Company’s
activities expose it to a variety of risks.
11.1 Product and environmental risks
Risk arising from product liability is protected
through insurance policies or limited through
contractual agreements wherever possible.
Risk associated with protection of environment,
safety of operations and health of people at work
is monitored regularly with reference to statutory
regulations prescribed by the government
authorities and guidelines defined by Clariant.
The Company does not merely fulfill the legal
requirements concerning emission, waste water
and waste disposal, but actually works to even
stricter self imposed standards.
11.2 Financial risks
Financial risk management is carried out by the
treasury department under policies approved by
the Board of Directors. Written policies for
overall foreign exchange risk and investing
excess liquidity are in place.
11.3 Market Risks
11.3.1 FOREX risk: The Company is exposed to
forex risks arising from various currency
exposures, primarily with respect to USD,
GBP, Euro and Swiss Franc. The Company
has an appropriate policy in place and
covers the risk partly through hedging by
means of forward transactions.
11.3.2 Interest risk: Interest risk mainly arises
from financial debt. The policy is to
borrow in fixed rate instruments provided
the risk of rising interest rates is seen to
be material. Downside interest views
allow for a lower fixed rate portion of
interest bearing financial debt.
7
11.3.3 Liquidity risk: Sufficient and not excessive
cash and marketable securities are kept
and investment is made mainly in debt
oriented mutual funds.
11.3.4 Credit risk: Credit risk policy is in place to
ensure that sale of products is made to
customers after an appropriate credit
limit allocation process.
11.4 Litigation Risks
The outcome of litigation in matters of tax law or
in any other statutory obligation cannot be
predicted and therefore poses a risk. In this
context, too, insurance policies, liquidity
reserves and credit lines limit the risk for the
Company.
11.5 IT Risks
Information Technology risk is associated with
failure of the system network resulting in
disruption of operations and consequential loss
of business. The Company’s business critical
software is operated on a server with regular
maintenance and back-up of data. The global
communication network is managed centrally
and is equipped to deal with failures and
breakdowns. Updated tools are regularly loaded
to ensure virus free environment.
Cautionary Statement
Statements in this Report particularly those which relate
to “Management Discussion & Analysis” may constitute
forward looking statements within the meaning of
applicable laws and regulations. Actual results may
differ materially from those expressed or implied in
the statement since the Company’s operations are
influenced by many external and internal factors beyond
the control of the Company.
12. Internal Control Systems and their adequacy
The Company has a proper and adequate system of
internal controls to ensure that all assets are
safeguarded and protected against loss from
unauthorised use or disposition and that transactions
are authorised, recorded and reported quickly. The
Company has established well defined written policies
and processes across the organisation pertaining to all
major activities including authority for approvals. In all
cases where a monetary decision is involved various
limits and authority are in place. A structured
Management Information System together with an
exhaustive budgetary control system covering all
major operations form part of the overall control
mechanism that ensures the requisite information
related to operations is being reported and is available
for control and review.
8
M/s. Mahajan & Aibara, Chartered Accountants is
the internal auditor for the Company. To ensure
independence and objective functioning, the internal
auditors report directly to the Audit Committee of the
Board. The internal auditors independently evaluate
adequacy of internal control systems. Based on the
audit observations and suggestions, follow up and
remedial measures are being taken including the
increased area of coverage, if necessary.
13. Cost Records
As per government directives, the Company’s cost
records in respect of Dyes and Pharma intermediates
for the year ended December 31, 2006 are being
audited by cost auditors M/s. Nanabhoy & Co. who
were appointed by board with the approval of Central
Government.
14. Human Resources
During the year, the Company focused on continuing
the integration and harmonisation of various HR
systems applicable to management staff such as
the Perquisite/Benefit Structure, the Performance
Management System, Leave Rules and Local Bonus
Plan.
HR supported the Businesses and Functions rationalise
their business processes and manpower. The
Company’s headcount as on December 31, 2006 was
1431 (March 31, 2006 – 1490).
15. Particulars of Employees
The statement giving particulars of employees, as
required under Section 217(2A) of the Companies Act,
1956 read with the Companies (Particulars of
Employees) Rules, 1975 forms part of this report.
However, as per the provision of Section 219 (1)(b)(iv) of
the Companies Act, 1956, the report and the statement
of accounts are being sent to all shareholders
excluding the above statement. Any shareholder
interested in obtaining a copy of this statement may
write to the Company Secretary at the Registered
Office of the Company.
16. Corporate Governance
(i) The disclosures as required under the Corporate
Governance have been furnished as a part of this
report. The Company has taken the requisite steps
to comply with the recommendations concerning
Corporate Governance. All board members and
senior managerial personnel have affirmed
compliance with the code of conduct for the
current year.
(ii) As a Listed Company, necessary measures are
taken to comply with the Listing Agreements with
the Stock Exchanges. A report on Corporate
Governance together with a certificate of
Directors’ Report
compliance from the Auditors, forms part of this
report.
17. Directors
(i) In accordance with the provisions of the
Companies Act, 1956 and the Articles of
Association of the Company, Mr. R. A. Shah,
Mr. P. Lindner and Diwan A. Nanda are due to
retire at the forthcoming Annual General Meeting,
and being eligible, have offered themselves for
re-appointment.
(ii) Details of the Directors seeking re-appointment
as required under Clause 49 VI of the Listing
Agreements entered into with the Stock
Exchanges are provided in the Corporate
Governance Report forming part of this Report.
18. Conservation of energy, technology absorption and
foreign exchange earnings and outgo
Statements giving the particulars relating to
conservation of energy, technology absorption and
foreign exchange earnings and outgo, as required
under the Companies (Disclosure of Particulars in the
Board of Directors’ Report) Rules, 1988 are annexed.
19. Socially Responsible
Even as the Company’s main objective is to increase
stakeholder value, it has not lost sight of its wider
social obligations. Long before the term Corporate
Social Responsibility became fashionable, the
Company followed an unwritten policy of providing
support to various local community development
initiatives — be it in the form of contributing to the
construction of a hospital at Roha or planting saplings
to promote ecological balance.
(b) appropriate accounting policies have been
selected and applied consistently and have 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 December 31,
2006 and of the profit of the Company for the nine
months period ended December 31, 2006;
(c) 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 fraud
and other irregularities;
(d) the accounts for the nine months period ended
December 31, 2006 have been prepared on a ‘going
concern’ basis.
21. Auditors
The auditors M/s. A.F. Ferguson & Co., Chartered
Accountants retire at the conclusion of the ensuing
Annual General Meeting and are eligible for
re-appointment. As required under the provisions of
Section 224(1B) of the Companies Act, 1956, the
Company has obtained confirmation from the auditors
proposed to be appointed that their re-appointment, if
made, would be in conformity with the limits specified
in the said Section.
The Company’s efforts continue to be focused on the
quality of life of the people in and around its various
geographical locations. During the nine months, the
Company provided significant financial and material
support to the various social, cultural, educational,
health and safety initiatives of the communities in and
around Thane, Roha, Cuddalore and Kanchipuram.
22. Acknowledgement
The Board of Directors wishes to express its gratitude
and record its sincere appreciation of the dedicated
efforts of all the employees, their commitment and
professionalism despite the challenging environment.
The Company continued to receive co-operation and
unstinted support from the customers, distributors,
suppliers and other business partners.
The Directors take this opportunity to express their
grateful appreciation of the excellent assistance and
co-operation received from Government bodies,
bankers and ongoing support received from Clariant
group companies. The Directors are thankful to the
esteemed shareholders for their support and the
confidence reposed in the Company.
20. Directors’ Responsibility Statement
Pursuant to Section 217(2AA) of the Companies Act,
1956, the Directors to the best of their knowledge and
belief confirm that:
For and on behalf of the Board of Directors,
(a) in the preparation of the annual accounts, the
applicable accounting standards have been
followed along with proper explanation relating to
material departure;
R. A. Shah
Chairman
Mumbai, February 22, 2007
9
Annexure to the Directors’ Report
Information as per Section 217(1)(e) read with Companies (Disclosure of
Particulars in the Report of Board of Directors) Rules, 1988 and forming
part of the Directors’ Report for the nine months period ended December
31, 2006.
FORM-A
Particulars with respect to Conservation of Energy
Particulars
A. POWER, FUEL AND WATER
CONSUMPTION:
1. Electricity:
(a) Purchased Units (in ‘000 Kwh)
Total amount (Rs. in lakhs)
Rate per Unit (Rs.)
(b) Own Generation:
(i) Through Diesel Generator
Unit (in ‘000 Kwh)
Units/litre of diesel oil
Per unit cost of diesel (Rs.)
(ii) Through Steam Turbine/
Generator
2. Coal
3. Furnace Oil and LSHS
Quantity (MT)
Total Amount (Rs. lakhs)
Average rate (Rs. / Kg.)
4. Others
5. Agro Mass Briquettes
Quantity - (Tonnes)
Total Amount (Rs. in lakhs)
Rate Per Unit / Rs. Kg.
6. Lignite/Fire Wood
Quantity (Tonnes)
Cost (Rs. lakhs)
Rate Per Kg.
Current
Previous
Period
Year
April 2006 to April 2005 to
December 2006 March 2006
37107
1586
4.27
47986
1801
3.75
493
3.41
9.34
643
3.24
9.22
NIL
NIL
NIL
NIL
3560
651
18.29
NIL
5224
802
15.35
NIL
11108
372
3.35
11975
369
3.08
1455
20
1.37
2414
34
1.40
B. CONSUMPTION PER UNIT OF PRODUCTION:
The Company manufactures a wide variety of products. The products
before reaching the finishing stage pass through various operations in
the different plants. It is, therefore, not feasible to furnish the
information in respect of consumption per unit of production.
·
Conservation of Energy
• Installation of Variable Frequency Drives on various process
equipment for power savings.
• Mercury Vapour Lamps (MVL) replaced by high efficient energy
saving Compact Fluorescent Lamps (CFL).
• Installation of solar street lights.
• Close loop arrangements in vacuum pumps for water savings reuse.
• Use of agro briquettes in addition to coal.
• Close control on boiler parameters for reduction of fuel
consumption.
• Installation of Air Manager on compressed air system for reduction
of power consumption.
• Installation of energy efficient pumps for cooling water circulation.
• Recycling of ice melted water in ice plant.
• Various modifications in ice plant for reduction in power
consumption.
• Modifications in WWTP for reduced water and power consumption.
• Installation of transparent roofing to provide more day light, and
elimination of electricity during day time.
• Relocation of certain utilities nearer to production at Balkam
resulted in substantial reduction of electricity consumption.
Additional investment and proposals planned:
• Co-gen Plant for producing own electricity and steam to face the
power crisis as well as uninterrupted power supply for production
plants.
10
• To evaluate the possibility of using Reverse Osmosis system for
recovery of water.
• Well designed and full fledged warehouse to take care of higher
volumes.
• Enhancement of Waste Water Plant
Impact on operation
The adoption of energy conservation measures indicated above has
resulted in substantial savings in the energy cost.
FORM B
Form of disclosure of particulars with respect to Absorption of
Technology, Research & Development (R & D)
Research & Development (R & D):
1. Specific areas in which R & D carried out by the Company :
The R & D department continued to direct its efforts towards the
development of technology for fine chemicals for active ingredients in
agro and pharma products, pigments, pigment preparations,
surfactants and auxiliaries meant for the local and export markets. The
Company is also carrying out contract research for the Clariant Group.
2. Benefits derived as a result of the above R & D:
R & D work resulted in enrichment of the Company’s product range
with promising new products and higher value addition due to cost
reduction by way of process improvements, energy savings and
reduction of chemical waste.
3. Future plan of action:
R & D activities will be further strengthened. The infrastructure has
been improved. New “state of the art” equipment for analysis and
application has been procured.
4. Expenditure on R & D
Rs. lakhs
(a) Capital
23.90
(b) Revenue
358.07
(c) Total
381.97
(d) Total R & D expenditure
as a percentage of total turnover
0.56%
Technology absorption, adaptation and innovation:
1. Efforts in brief, made towards technology absorption, adaption and
innovation:
The R & D department absorbs the knowledge of chemical technology
from various sources such as know-how from the parent company and
its worldwide affiliates, their own experimental data bank, published
literature etc. and thereafter adapts the same to the Company’s
infrastructure, effects improvements to the products and processes of
the Company including containment of pollution and control of
effluents.
2. Benefits derived as a result of the above efforts, e.g. product
improvement, cost reduction, product development, import
substitution etc.
Benefits derived from these efforts include process rationalisation,
product quality improvement, import substitution and overall cost
reduction.
3. In case of imported technology (imported during the last 5 years
reckoned from the beginning of the financial year), following
information may be furnished.
(a) Technology imported
:
NIL
(b) Year of import
:
N.A.
(c) Has technology fully absorbed
:
N.A.
Foreign Exchange Earnings and Outgo
1. Total foreign exchange earned
2. Total foreign exchange used
:
:
Rs. lakhs
17198.12
15658.45
For and on behalf of Board of Directors
R. A. Shah
Chairman
Corporate Governance
COMPANY’S CORPORATE GOVERNANCE PHILOSOPHY
The corporate governance process at Clariant Chemicals
(India) Limited (CCIL) seeks to optimize economic results
while meeting the aspirations of all its key stakeholder
groups and the expectations of the society in which it
operates.
Clariant’s Corporate Governance structure, systems and
processes are based on two core principles:
1.
Management must have the executive freedom to drive
the enterprise forward without undue restraints; and
2.
This freedom of management should be exercised with
a framework of effective accountability.
The Company believes that any meaningful policy on
Corporate Governance must empower the executive
management of the Company. At the same time,
Governance must create a mechanism of checks and
balances to ensure that the decision-making powers vested
in the executive management are used with care and
responsibility to meet stakeholders’ aspirations and societal
expectations.
The Company’s business goals very closely approximate the
corporate philosophy eloquently articulated in Clariant’s
vision, mission and values statements. The Company has
always aimed to be the leading service-driven company and
the preferred partner in the specialty chemicals industry in
India. Our commitment to service has contributed in no
small measure to the success of our customers. We
combine leading edge technology and innovation with
superior applications and customer service skills.
The way we conduct our day to day operations provides
true testimony to the values enumerated by Clariant:
! Customer Focus
! Personal Engagement
! Team Orientation
! Innovation
! Shareholder Commitment
! Integrity
! Sustainability
This bedrock of values guides our thinking and behaviour
and has helped us create wealth for our primary
stakeholders, viz., customers, employees and owners in a
socially responsible way. We aim to maximise the long term
value for our shareholders through achieving business
excellence.
We adhere to the highest business ethics, comply with
statutory and regulatory requirements and are committed to
transparency in our business dealings. We uphold the rights
of each of the stakeholder groups for information on the
business and the financial performance of the Company and
strive to meet these needs in a consistent and regular
manner.
Trusteeship recognizes that large corporations, which
represent a coalition of interests, namely those of the
shareholders, other providers of capital, business
associates and employees, have both an economic and a
social purpose, thereby casting the responsibility on the
Board of Directors to protect and enhance shareholder
value, as well as fulfill obligations to other stakeholders.
Inherent in the concept of trusteeship is the responsibility to
ensure equity, namely, that the rights of all shareholders,
large or small, are protected.
Transparency means explaining the Company’s policies
and actions to those to whom it has responsibilities.
Externally, this means maximum appropriate disclosures
without jeopardizing the Company’s strategic interests and
internally, this means openness in the Company’s
relationship with its employees and in the conduct of its
business. CCIL believes that the transparency enhances
accountability.
Empowerment is a process of unleashing creativity and
innovation throughout the organisation by truly vesting
decision-making powers at the most appropriate levels and
as close to the scene of action as feasible, thereby helping
actualise the potential of its employees. Empowerment is
a key concomitant of CCIL’s first core principle of
governance that management must have the freedom
to drive the enterprise forward. CCIL believes that
empowerment combined with accountability proves an
impetus to performance and improves effectiveness,
thereby enhancing shareholder value.
Control ensures that freedom of management is exercised
within a framework of checks and balances and is designed
to prevent misuse of power, facilitate timely management of
change and ensure effective management of risks. CCIL
believes that control is an essential element of its second
core principle of governance that the freedom of
management should be exercised within a framework of
appropriate checks and balances.
Value-driven and transparent management is the
foundation for a successful business. At Clariant this is
reflected in a responsible and efficiently structured
organisation, in its management, and in control processes.
The Company has established an efficient and transparent
division of tasks and responsibilities, effective control
instruments and an open information policy as a proof of its
commitment, fairness and responsibility as a business
partner.
At Clariant it is a kind of self-disciplinary code designed to
secure the ultimate goal of making the Company a value
driven organisation.
11
1.
2.
2.1
Group Structure:
Clariant is a global leader in the field of specialty
chemicals. Clariant Chemicals (India) Limited is an
affiliate of Switzerland based Clariant group, which
is represented on five continents with over 100
group companies, employs about 21,500 people and
is headquartered in Muttenz near Basel. Clariant
Chemicals (India) Limited operates in the following
segments: Intermediates and Colours, Dyes and
Specialty Chemicals and Masterbatches.
Board of Directors:
In accordance with the law, the Board of Directors
is the apex management body of the Company. The
Board acts as the nerve centre of the organisation,
in addition to reviewing and approving specific
corporate actions as required by law (e.g.,
declaration of dividends and approval of accounts)
is actively involved in reviewing and guiding
corporate strategy and major plans of action,
monitor implementation of plans and corporate
performance, ensuring the integrity of the
Company’s accounting and financial reporting
systems and over viewing compliance with all
legislations applicable to the business.
Composition
As provided in Article 109 of the Articles of
Association of the Company the number of members
on the Board should not exceed twelve.
As on December 31, 2006 the Board consists of
eight members including three independent
directors. The Chairman of the Board is
Non-executive director. The Board comprises of
eminent professionals drawn from diverse fields.
None of the directors is related to each other.
During the nine months period ended on December
31, 2006 all the members of the Board are nonexecutive except Mr. H. Meier.
The Board members are expected to attend and
participate in the Board meetings and Committee
meetings in which they are members.
Dr. A. Walde, Mr. W. Mohr and Mr. P. Lindner as
members on the Board of Directors represent the
interest of parent Company.
2.2
12
Election and terms of office
As on December 31, 2006 all the Directors except
Mr. H. Meier are subject to retirement by rotation.
Mr. H. Meier was appointed as Vice-Chairman &
Managing Director on contractual basis for a period
of three years commencing from April 1, 2006.
The following table gives the date of appointment/
re-appointment of members of the Board of
Directors:
2.3
Name of Directors
Date of appointment/
re-appointment
Mr. R. A. Shah
29.07.2004 to be re-appointed
on the date of AGM
Mr. H. Meier
01.04.2006
Mr. K. J. Bharucha
27.07.2006
Mr. P. Lindner
28.07.2005 to be re-appointed on
the date of AGM
Dr. A. Walde
27.07.2006
Mr. B. S. Mehta
27.07.2006
Diwan A. Nanda
24.03.2006 to be re-appointed on
the date of AGM
Mr. W. Mohr
27.07.2006
Profile of Members of the Board of Directors being
re-appointed
Mr. R. A. Shah
Mr. R. A. Shah is a Solicitor and Senior Partner of
M/s. Crawford Bayley & Co., Solicitors & Advocates,
Mumbai. He joined the Board of the Company in
August 1976. He specialises in a broad spectrum of
Corporate Laws in general, with special focus on
foreign investments, joint ventures, technology and
licence agreements, intellectual property rights,
mergers and acquisitions, industrial licensing,
antitrust laws and company law. He is a member of
the Managing Committee of Bombay Chamber of
Commerce, Indo-German Chamber of Commerce.
He is the Chairman of the Audit Committee of the
Company.
Names of other companies in which Mr. R. A. Shah
holds Directorships as at December 31, 2006:
Name of the Company/Firm
Nature of interest
Abbott India Ltd.
Director
Godfrey Philips India Ltd.
Chairman
Modicare Ltd.
Alternate Director
Pfizer Ltd.
Chairman
Roche Scientific Co. (I) Pvt. Ltd.
Chairman
Colgate Palmolive India Ltd.
Vice-Chairman
The Bombay Dyeing & Mfg. Co. Ltd.
Director
BASF India Ltd.
Director
Deepak Fertilisers & Petrochemicals
Corporation Ltd.
Director
Asian Paints Ltd.
Director
Nicholas Piramal India Ltd.
Director
Procter & Gamble Hygiene and
Health Care Ltd.
Director
Nature of interest
RPG Life Sciences Ltd.
Alternate Director
Century Enka Ltd.
Alternate Director
Schrader Duncan Ltd.
Alternate Director
Uhde India Ltd.
Alternate Director
Wokhardt Ltd.
Director
Society of Indian Law Firms
(Western Region)
President
Bombay Chamber of Commerce
Committee Member
Indo German Chamber of Commerce
Committee Member
Crawford Bayley & Co.
Partner
Jumbo World Holdings Ltd.
(Foreign Company)
Director
BASF Polyurethanes India Ltd.
Alternate Director
Gillette India Ltd.
Director
Lupin Ltd.
Director
Atul Ltd.
Alternate Director
ACC Ltd.
Director
Mr. P. Lindner
Mr. P. Lindner holds a Diploma in Industrial
Business from the Chamber of Commerce, Frankfurt
am Main, Germany. He has relevant experience of
over 35 years in the specialty chemical business. He
is presently the Region President, Special Markets,
Clariant International Ltd. Mr. Lindner joined the
Board of the Company in October, 2001.
Diwan A. Nanda
Diwan A. Nanda, is gold medalist from the Indian
Institute of Management, Ahmedabad. He has over
40 years of vast experience in marketing and
advertising. He started his career in Marketing in
Hindustan Lever Limited and founded Rediffusion an
advertising agency in 1973. Diwan A. Nanda has
held various positions in academic and advertising.
He is the recipient of AAAI Premnarayan award for
outstanding contribution to advertising in India in
2002. He is also on the Board of the following
Companies as at December 31, 2006:
2.4
Board Meetings
In compliance with the provisions of clause 49 of the
listing agreement, the Board meets at least once
every quarter to review the performance and to
deliberate and consider other items on the agenda.
During the nine months under review, four meetings
were held on:
May 30, 2006;
July 27, 2006;
September 14, 2006 and
October 30, 2006.
The meetings of the Board of Directors are
scheduled well in advance and are held at Mumbai
where the registered office of the Company is
situated. The Chief Financial Officer & Company
Secretary in consultation with the Vice-Chairman
and Managing Director prepares a detailed agenda
for the meeting. The board papers comprising the
agenda along with the draft of relevant resolutions,
documents and explanatory notes, wherever
required are sent at least a week in advance to all
the Directors. The members of the Board are free to
recommend inclusion of any matter in the agenda for
discussion. This enables the Board to discharge its
responsibilities effectively and take informed
decisions. The draft minutes of the meeting
confirmed by the Chairman is circulated to all the
members generally within two weeks after the
conclusion of the meeting. The information generally
provided to the Board for its consideration and
approvals include:
•
Minutes of the meetings of Board, Audit and
Investors Grievance Committees including that
of subsidiary company;
•
Commission payable to Directors;
•
Quarterly, half yearly and annual financial
results of the Company and its business
segments;
•
Cost Audit report/Secretarial audit report;
Nature of interest
•
Annual budget and performance targets;
Rediffusion DY & R Pvt. Ltd.
Director
•
Opportunities for merger and acquisition;
Rediffusion DY & R Pvt. Ltd., Sri Lanka
Director
Rediffusion Holdings Pvt. Ltd.
Director
•
Rediff.com India Ltd.
Director
Appointment of statutory, secretarial auditor,
cost auditor and internal auditor;
Wunderman India Pvt. Ltd.
Director
•
Appointment of key management positions;
Everest Brand Solutions Pvt. Ltd.
Director
•
Klaas Equipment Pvt. Ltd.
Director
Issues relating to workmen and executives
such as settlements, increments, special loans/
advances;
•
Issues relating to shareholders — such as
ratification of transfers, demat status, pending
grievances, issue of duplicate share
certificates, etc.;
Arion Horse Co. Pvt. Ltd.
Director
Showdiff Worldwide Pvt. Ltd.
Director
Eveready Industries (India) Ltd.
Director
King Fisher Airlines Ltd.
Director
Mastek Limited
Director
13
•
•
•
•
•
•
•
•
2.5
Materially important show cause, demand,
prosecution and penalty notices;
Review of foreign exchange exposures and
exchange rate movement, if material;
Contracts in which Director(s) are deemed to be
interested;
Defaults in payment of statutory dues, if any;
Matters requiring statutory/board approvals;
Status on compliance of any regulatory or
statutory nature or listing requirement;
Issue/revocation of Power of Attorney;
General disclosure of interest.
Board Committee
Since March 24, 2006, Mr. K. J. Bharucha is the
Chairman of the Board Committee and Mr. H. Meier
is a member.
During the period of nine months ended on
December 31, 2006 one meeting was held on June 8,
2006 and both the members were present in the
aforesaid meeting. The committee usually looks into
raising short term borrowings/deposits and
deployment of surplus funds, if any, and similar
issues.
2.6
The requirement that a Director shall not be a
member of more than 10 committees and Chairman
of more than 5 committees has been complied with
while constituting the Committees of Directors.
The following table gives the attendance of the
Directors at the Board meetings of the Company and
also the other Directorship and Chairmanship/
membership in Board committees.
Management Committee
The board of Directors of the company provides
leadership and strategic guidance, while the
Management Committee administers the affairs of
the Company’s business on a day to day basis. The
committee consists of Vice-Chairman & Managing
Director, Chief Financial Officer & Company
Secretary and the respective Head of businesses.
The Management committee is chaired by
Directors Attendance Record and Directorships*
Particulars of
Attendance
Name of the
Director
Category
Number of
Board
Meetings
No. of other Directorships and Committees
memberships/Chairmanships in
Indian Public Companies#
Last
AGM
held on
27.7.06
Held
Attended
Other
Directorships
as on
31.12.06
Committee
Memberships
Committee
Chairmanships
Mr. R. A. Shah
Non-Executive Independent
4
3
Attended
14
8
5
Mr. H. Meier
Executive
4
4
Attended
None
1
None
Mr. K. J. Bharucha
Non-Executive
4
4
Attended
3
1
None
Mr. P. Lindner
Non-Executive
4
1
Attended
None
None
None
Dr. A. Walde
Non-Executive
4
1
Attended
None
None
None
Mr. B. S. Mehta
4
4
Attended
14
10
5
Diwan A. Nanda
4
2
Attended
4
2
1
Mr. W. Mohr
Non-Executive
4
1
Attended
None
None
None
*
This excludes alternate Directorships/Directorships in private limited companies, foreign companies and companies governed by Section 25 of the
Companies Act, 1956 where applicable.
#
It excludes committees other than Audit Committee, Shareholders/Investor Grievance Committee and companies other than public limited company
but includes committee membership/chairmanship in Clariant Chemicals (India) Ltd.
14
Mr. H. Meier, Vice-Chairman & Managing Director
and includes following members:
3.2
Management Committee
Mr. H. Meier
3.
3.1
Vice-Chairman & Managing Director
Mr. S. K. Nayak
CFO & Company Secretary
Mr. A. K. Prasad
Business – Textiles, Leather & Paper
Dr. G. G. Patkar
Business – Pigments & Additives
Dr. S. Siddhan
Business – FUN & LSC
Mr. S. S. Patil
Business – Masterbatches
Audit committee:
Composition
The audit committee was formed in 2001 and has
been reconstituted over the years as per the legal
requirements from time to time. During the period
under review, Mr. R. A. Shah, Non-Executive
Independent
Director,
Diwan
A.
Nanda,
Non-Executive
Independent
Director
and
Mr. K. J. Bharucha, Non-Executive Director were
the three members appointed for the committee
effective from 25.03.2006. Mr. R. A. Shah chairs the
committee. Mr. K. J. Bharucha being Chartered
Accountant has accounting/financial management
expertise. The statutory auditors, internal auditors
and cost auditors are also invited to attend the audit
committee meetings from time to time.
Vice-Chairman & Managing Director attends the
Audit Committee meetings. Mr. Sunil K. Nayak, Chief
Financial Officer & Company Secretary represents
the finance function and also acts as Secretary to
the committee. All major variances affecting the
performance of the Company are discussed and
explained. During the period under review, three
meetings of the Audit Committee were held on:
In fulfilling the above role, the Audit Committee has
powers to investigate any activity within its terms of
reference, to seek information from employees and
to obtain outside legal and professional advice. The
draft minutes of the audit committee meetings are
circulated among members before the same is
confirmed and placed before the Board.
May 23, 2006; (adjourned for May 29, 2006)*
July 27, 2006 and
October 30, 2006.
All the meetings were attended by Mr. H. Meier,
Vice-Chairman and Managing Director and
Mr. Sunil K. Nayak, CFO & Company Secretary.
Attendance of Audit Committee meetings
meetings:
Name of Director Category
Status
Number of
Meetings
Held
Attended
Mr. R. A. Shah
Independent Chairman
3
3
Diwan A. Nanda
Independent Member
3
3
Mr. K. J. Bharucha
NonIndependent Member
3
3
* Mr. R. A. Shah participated in this meeting through
teleconferencing.
Scope of Audit Committee
The Audit Committee acts as a link between the
statutory and internal auditors and the Board
of Directors. The Audit Committee makes
recommendations to the Board within the delegated
authority. The terms of reference of the audit
committee are in accordance with clause 49(II) of
the listing agreement entered into with the relevant
stock exchanges and include:
• Effective supervision of financial reporting
processes;
• Ensuring completeness of coverage, accurate,
timely and proper disclosure of financial
reporting;
• Review of annual, half yearly and quarterly
financial results before submission to the
Board;
• Review of cost audit report;
• Review of adequacy of internal audit and
control and actions arising out of reports;
• Ensure compliance with accounting standards,
and with listing agreements with respect to the
financial statements;
• Discussion with statutory and internal auditors
on the scope of audit, general observations,
significant findings and follow-up thereon;
• Recommending the appointment of statutory
auditors and approval of payments to statutory
auditors for any other services;;
• Statement of significant related party
transactions;
4.
Remuneration Committee:
The Company has not constituted a remuneration
Committee as all compensation/remuneration
payable to the Directors are approved by the
shareholders in the general meeting.
The Company has no pecuniary relationship or
transaction with its Non-executive Directors other
than payment of commission and sitting fees, which
has been approved by the shareholders and
payment of dividend on equity shares, if any, held by
Directors in the Company. The Company has sought
the expert legal advice of M/s. Crawford Bayley &
Co., Solicitors & Advocates in certain matters and a
sum of Rs. 30.44 lakhs has been paid as professional
fees to the said firm during the period of nine months
15
ended at December 31, 2006. Mr. R. A. Shah,
who is the Chairman of the Company, is the senior
partner of the said firm. The aforesaid professional
fees is not considered material enough that may
have potential conflict with the interest of the
Company and to impinge on the independence of
Mr. R. A. Shah.
Mr. K. J. Bharucha was the Managing Director of
the Company for the past several years. He is a nonexecutive Director in the Company from April 1, 2006
onwards. The Company has paid Rs. 154.20 lakhs to
him as non compete fees during the current period.
The remuneration structure of Mr. H. J. Meier,
Vice-Chairman & Managing Director, head of the
organisation, is based on performance and defined
criteria. The yearly increments are decided by the
Board of Directors within the limits approved by the
members pursuant to provisions of the Companies
Act, 1956. The remuneration comprises of salary,
fixed and variable commission linked with
performance, perquisites and benefits as per
Company rules, contribution to provident fund,
superannuation fund and gratuity. The service
contract with the Vice-Chairman & Managing
Director is for a period of three years ending on
March 31, 2009 with a notice period of six months by
either of the party for termination.
In accordance with the resolution passed at annual
general meeting held on July 28, 2005 the
shareholders have approved the payment of
commission to non-executive Directors subject to
the provisions of Section 198, 309 and other
applicable provisions of the Companies Act, 1956.
The Company has accordingly provided for the
commission to its non-executive independent
Directors in addition to sitting fees for the meetings
of board and committees attended by them except
in case of Mr. P. Lindner, Dr. A. Walde and
Mr. W. Mohr (who represent the Clariant group)
and hence, do not draw any remuneration from the
Company.
The details of remuneration paid to the directors for
the nine months period ended December 31, 2006
Rupees
are as under:
Name of Director
Sitting
fees
Mr. R. A. Shah
25,000
Mr. H. Meier
16
Salary & Commis- ProviPerquision dent &
sites
Superannuation
Funds
NIL 2,00,000
NIL 96,01,000 15,75,000
NIL
Total
2,25,000
NIL 111,76,000
Mr. B. S. Mehta
20,000
NIL 2,00,000
NIL
2,20,000
Diwan A. Nanda
35,000
NIL 2,00,000
NIL
2,35,000
Mr. K. J. Bharucha
42,000
NIL 2,00,000
NIL
2,42,000
5.
Investors’ Grievance Committee:
The members of Investor’s Grievance Committee
comprise of Diwan A. Nanda non-executive
independent director as Chairman and Mr. H. Meier
Vice-Chairman & Managing Director as a member.
The committee oversees share transfers and
monitors redressal of shareholder/investor
complaints received by the Company and their
resolution. The committee met two times (July 27,
2006 and October 30, 2006) during the period of nine
months.
To expedite the process of physical transfer of
shares the Board has delegated the authority to
Mr. Sunil K. Nayak, Chief Financial Officer &
Company Secretary who is the compliance officer of
the Company. The physical transfers of shares
approved are ratified at the subsequent Board
meeting.
In accordance with the authority granted by the
Board, Mr. Nayak deals with the following matters
concerning shareholders at least once in a fortnight:
• Transfer/Transmission of physical shares
• Split/Sub-division and Consolidation of physical
shares
• Rematerialisation of shares
M/s. Sharepro Services (India) Private Limited, the
Registrar and Share Transfer Agents, deals with all
shareholder related matters whether it relates to the
physical or demat form.
The Company has retained the services of a
practicing Company Secretary to independently
verify and audit the share transfer records and
register of members every quarter. No materially
significant non-compliance from established
procedures is reported.
During the period under review, the Company
received one complaint through stock exchanges/
SEBI and the same has been resolved. Apart from
this complaint, communications received from
shareholders are generally pertaining to non-receipt
of dividend warrants, transfer of physical shares/
change of address/bank mandate/revalidation
of dividend warrant/consolidation/split/remat/
exchange of shares etc. All of these have been
answered and redressed to the satisfaction of
shareholders. There was no investor grievance
which remained unattended and pending as on
December 31, 2006. The Board has consented to the
understanding that complaints of non-receipt of
Dividend, Annual Reports, and the refund of fixed
deposits and interest on fixed deposits etc., will not
be treated as complaints under Clause 49 (G) (iii), as
the Company’s liability is discharged when the
relevant articles are posted at the last known
address of the investor. And that in the above cases
the letters received from the investors will be
serviced in addition to the responsibility under
clause 49 of the Listing Agreement, as investor
friendly measure beyond the legal obligations.
8.2
Code of Conduct
The Board of Directors has adopted the code of
conduct for Directors and Senior Management and
the same has been placed on the Company’s
website. All Board members and senior
management personnel have affirmed compliance
with the code of conduct for the period under
review.
8.3
Prohibition of Insider Trading
The Company has framed its Insider Trading
Regulations wherein rules for the preservation of
price sensitive information, pre-clearance of trade,
monitoring and implementation are framed. This
code is applicable to all Directors and such
employees of the Company who are expected to
have access to unpublished price sensitive
information relating to the Company. Transaction for
dealing in the prescribed volume of the security of
the Company during the prescribed time requires
prior approval from the Company.
Attendance of Investors’ Grievance Committee
Meetings
Meetings:
Name of
Director
Category
Status
Number of Meetings
Held
Attended
Diwan A.
Nanda
Independent Chairman
2
2
Mr. H. Meier
Executive
2
2
Member
Details of Complaints received and attended
during the period of nine months ended
December 31, 2006
Nature of Complaint No. of complaints
received
Non-receipt of
Interest in open offer
6.
No. of complaints
redressed
1
1
Subsidiary Company:
Chemtreat Composites India Private Limited
commenced commercial production in September
2006.
Shares held by the Directors as at
December 31, 2006
Name of Director
The copy of the minutes of the Board Meetings of
Chemtreat Composites India Private Limited are
placed in the subsequent Board Meetings.
7.
8.
8.1
General Body Meetings:
The last three Annual General Meetings of the
Company were held on the following dates and
times:
AGM
Venue
Date
Time
47th
Gen. Jagannath Bhosale
Marg, Mumbai 400 021
29.07.2004
4.00 p.m.
48th
28.07.2005
4.00 p.m.
49th
27.07.2006
3.00 p.m.
Disclosures:
The Company has not entered into any transactions
of material nature, with its promoters, the directors,
or the management committee members, their
subsidiaries or relatives etc. that may have potential
conflict with the interests of the Company. The
disclosure in respect of related party transactions is
provided in the notes to the accounts. All contracts
with the affiliates entered into during the period
under review which are in the normal course of
business and have no potential conflict with the
interest of the company at large and are carried out
on an arm’s length basis at fair market value.
8.4
Number of
shares held
Details of shares
bought/sold during
April-December, 2006
Mr. R. A. Shah
NIL
NIL
Mr. H. Meier
NIL
NIL
Mr. B. S. Mehta
NIL
NIL
Diwan A. Nanda
NIL
NIL
Mr. P. Lindner
NIL
NIL
Mr. A. Walde
NIL
NIL
Mr. W. Mohr
NIL
NIL
Mr. K. J. Bharucha
50
NIL
Special Resolutions
At the 49th Annual General Meeting held on
July 27, 2006 a special resolution was passed for
re-appointments of Directors who were appointed
during the year as additional Director or in the
casual vacancy caused by the resignation of
Directors.
At the 48th Annual General Meeting held on July 28,
2005 a special resolution was passed to increase
the sitting fees and the commission payable to
non-executive Directors.
At the 48th Annual General Meeting held on July 28,
2005 a special resolution was passed amending the
Articles of Association.
There was no postal ballot conducted during the
three years.
17
9.
Means of communication:
•
The Company has 30,743 shareholders as on
December 31, 2006. The main channel of
communication to the shareholders is through
annual report which includes inter alia, the
Directors’ Report, the Report on Corporate
Governance, audited financial results.
•
The Annual General Meeting is the principal
forum for face-to-face communication with
shareholders, where the board responds to the
specific queries of the shareholders.
•
Six Monthly results for the period ended on
September 30, 2006 were sent to all the
shareholders through an investor newsletter
‘The Review’.
•
•
•
•
•
10.
10.1
Voting rights
In terms of Articles 93 to 105 of the Articles of
Association of the Company, every member present
in person or proxy, attorney or representative at the
general meeting of the members shall have the
following voting rights:
• On a show of hands: one vote for a member
present in person;
• On a poll: one vote for each equity share
registered in the name of the member or held by
the beneficial owner;
• Proxy has no right to speak.
10.3
Financial Calendar
The Company’s current financial year is based on
nine months beginning from April to December 2006.
Quarterly results are approved by the Board of
Directors and submitted to the Stock
Exchanges in terms of the requirements of
clause 41 of the Listing Agreement.
Announcement of Audited/Unaudited Results:
April to
December, 2006
Quarterly results are published the day after the
Board Meeting, after approval of the Board, in
any two of the prominent English and
vernacular publication, such as Economic
Times/Business Standard/Free Press Journal/
Maharashtra Times/Nav Shakti/Sakal, as per
the availability of space.
The
website
of
the
Company
www.clariantindia.com acts as the primary
source of information regarding the operations
of the Company. Quarterly financial results and
media releases are being displayed on the
Company’s website. Periodic discussions were
held with analysts and institutional investors
during the period.
January-March
10.4
The financial results and shareholding pattern
for each quarter are also provided on the SEBI
website www.sebiedifar.nic maintained by
National Informatics Centre and can be
retrieved from this web site.
A Management Discussion and Analysis Report
which includes the risk management policies
followed by the Company is included as a part
of Director’s report.
General shareholder information:
Annual General Meeting
Date and Time
Time:
Thursday, April 19, 2007 at 04.00 p.m.
Venue:
Y. B. Chavan Auditorium, General Jagannath
Bhosale Marg, Next to Sachivalaya Gymkhana,
Mumbai-400 021.
18
10.2
January to
December 2007
(Proposed)
Last week of April,
2007
April-June
27.07.2006
Last week of July,
2007
July-September
30.10.2006
Last week of
October, 2007
October-December 22.02.2007
Last week of
February, 2008
Annual General
Meeting
Last week of April,
2008
19.04.2007
Dates of Book Closure
April to
December 2006
January to December
2007 (Proposed)
Book Closure
dates
April 5, 2007 to
April 19, 2007
(Both days
inclusive)
Second fortnight of
April, 2008
Payment of
Dividend
On or after
April 20, 2007
Immediately after
AGM
10.5
Listing of Shares
Shares of the Company are listed on Bombay Stock
Exchange Ltd., Mumbai (BSE) and National Stock
Exchange of India Limited (NSE).
The Company has paid the listing fees upto March
31, 2007 to both the Stock Exchanges.
10.6
Stock Code
Name of the
Exchange
Stock
Code No.
Closing Price
as on
31.12.2006
Date of
Ex-Dividend
BSE
CLARICHEM
337.15
April 3, 2007
NSE
CLNINDIA
336.50
April 3, 2007
10.7
Stock Market Data Rupees per share
Month
10.8
Bombay Stock
Exchange (BSE)
National Stock
Exchange (NSE)
High
Rs.
Low
Rs.
Volume
Nos.
High
Rs.
Low
Rs.
Volume
Nos.
April ‘06
378.00
335.00
35363
381.00
325.00
34004
May
389.00
300.05
44651
400.10
300.00
23846
June
325.95
236.00
613264
322.00
235.00
42849
July
282.25
226.60
84776
278.75
230.00
160115
August
325.00
240.35
85790
327.90
245.20
43583
September 325.00
282.00
61278
318.90
281.10
31434
October
337.00
294.00
137797
359.00
295.00
124148
November
331.85
295.20
215276
324.00
292.50
185506
December
357.80
295.00 2806079
350.00
291.30
282624
Performance of Company Shares to broad based
index (BSE Sensex)
For any assistance from the Company, members
may contact Mr. Satish P. Bhattu, Asst. Company
Secretary, at Ravindra Annexe, 194, Churchgate
Reclamation, Mumbai-400 020. The Company
periodically reviews the operations of registrar &
share transfer agents and an independent audit/
verification is carried by qualified professional for
efficiency and effectiveness of services at regular
intervals.
10.10 Share Transfer System
Transfer of shares held in physical mode is
processed by Sharepro Services (India) Private
Limited and approved by CFO & Company Secretary
pursuant to the powers delegated to him by the
Board of Directors of the Company.
During the period of nine months ended December
31, 2006, 18 approvals for transfer/transmission
of 31,020 shares in physical mode were accorded
with an average interval of 15 days between
approvals.
10.11 Shareholding pattern as on 31.12.2006
Category
A.
No. of
Equity
shares
held
Percentage
of Shareholding
(i) EBITO Chemiebeteiligungen AG
8167080
30.63
(ii) Clariant International AG
6075000
22.79
Promoters’ Holding
Promoters
Foreign Promoters
(iii) Clariant Participations AG
Sub-Total
B.
Address for correspondence
Registrar & Share Transfer Agents:
M/s. Sharepro Services (India) Pvt. Ltd.
Satam Estate, 3rd Floor, Above Bank of Baroda
Mumbai-400 099.
Tel: 28215168/69, Fax: 28375646
Contact Person: Mrs. Indira Karkera/Mr. B. Dinkar
email ID under clause 47(f) of Listing agreement:
[email protected]
All queries for shares held in physical form only
should be forwarded to Registrar & Transfer Agents
(R & T Agent) at the above mentioned address.
(b) Financial Institutions
General Insurance Corporation
of India and its subsidiaries
Nationalised Banks
(c) Foreign Institutional Investors
Sub-Total
C.
2834095
10.63
894165
3.35
15922
0.06
4398
0.02
3748580
14.06
465314
1.75
96344
0.36
Others
(a) Domestic Companies
(b) Non-Resident Indians/Overseas
Corporate Bodies
D.
9.98
63.40
Institutional Investors
(a) Mutual Funds
10.9
2660000
16902080
(c) Indian Public
5448427
20.43
Sub-Total
6010085
22.54
Public Holding (B+C)
9758665
36.60
26660745
100.00
Total
19
and not to the Company or the R & T Agent. This is
because once the shares are dematerialised they
become fungible i.e., they lose their distinct data
relating to the folio number, the certificate number,
the distinctive share numbers, etc. and the
corresponding credit for number of shares is given
to the individual shareholder in his account with the
concerned DP. As and when required by the
Company, the share transfer agents obtains details
regarding beneficial owner data including
addresses from the National Securities Depository
Limited or the Central Depository Services (India)
Limited.
10.12 Details of Members holding > 1% of the paid up
capital of the Company as on 31.12.2006
Name
No. of
shares
%
1. EBITO Chemiebeteiligungen AG
8167080 30.63
2. Clariant International AG
6075000 22.79
3. Clariant Participations AG
2660000
9.98
4. Templeton M.F. A/c. Franklin India
Flexicap Fund
800000
3.00
5. UTI (through its various schemes)
346004
1.30
6. Prudential ICICI Trust Ltd. TAX Plan
603929
2.27
7. The New India Assurance Co. Ltd.
290054
1.09
8. UTI Master Value Fund
289508
1.09
10.13 Distribution of shareholdings as on 31.12.2006
No. of equity
shares held
Shareholders
Equity Shares held
Numbers
%
No. of
shares
%
28558
92.893
2785747
10.449
501-1000
1348
4.385
968828
3.634
1001-2000
529
1.721
756455
2.837
2001-3000
126
0.410
317788
1.192
3001-4000
50
0.163
172333
0.646
1-500
4001-5000
50
0.163
230400
0.864
5001-10000
41
0.133
294568
1.105
41
0.133
21134626
79.272
30743
100
26660745
100
10001 & above
Total
10.14 Dematerialisation of shares and liquidity
Names of Depositories for dematerialisation of
equity shares
Name of the Depository
ISIN No.
National Securities Depositories Limited (NSDL)
INE492A01029
Central Depository Services (India) Limited (CDSL)
INE492A01029
Trading in equity shares of the Company is permitted
only in dematerialised form.
In case shares of the Company are held in
form), all
electronic form (that is, in dematerialised form)
communications concerning rematerialisation of
shares transfer and transmission, dividends,
change of address, furnishing of alterations in bank
account details, nominations, ECS credit of dividend
amount to shareholders’ bank account or other
inquiries should be addressed only to the
Depository Participant (DP) with whom demat
account is maintained
maintained, quoting client ID number
20
As on December 31, 2006, in all 1,92,33,440 shares
constituting 72.14 per cent of the total issued capital
is held in demat form.
10.15 ADRs/GDRs/Warrants
The Company has not issued any GDRs/ADRs/
Warrants or any other convertible instruments.
10.16 Plant Locations
The Company’s manufacturing facilities are located
at:
(a) 113/114, MIDC, A.V.P.O. Dhatav, Roha,
Dist. Raigad-402 116 (Maharashtra)
(b) Balkum Village, Thane-400 608 (Maharashtra)
(c) Kolshet Road, Thane-400 607 (Maharashtra)
(d) Kudikadu, SIPCOT, P.O., Cuddalore-607 005
(Tamil Nadu)
(e) Singadivakkam Village, Kanchipuram-631 561
(Tamil Nadu)
11.
Additional Information:
11.1
Dividend for the period of nine months ended
December 31, 2006
The dividend recommended by the Board for the
current period under review will be paid after
approval of shareholders at the forthcoming Annual
General Meeting to all those shareholders whose
names appear:
(i)
in respect of shares held in demat form, as
beneficial owner, as per details furnished by
the Depositories as at the end of the business
on April 4, 2007 and
(ii) in respect of shares held in physical form as
members in the Register of Members of the
Company after giving effect to all valid share
transfers lodged with the share transfer agent
on or before April 4, 2007. The Company
will dispatch the dividend warrants on or after
April 20, 2007.
11.2
Unpaid/Unclaimed Dividend
In terms of the amended provisions of Section 205C
of the Companies Act, 1956 the Company is obliged
to transfer dividends which remain unpaid or
unclaimed for period of seven years (from the date of
declaration of dividend) to the credit of the Investor
Education and Protection Fund established by the
Central Government. Accordingly, the Company has
transferred unpaid/unclaimed dividend up to the
financial year 1998-99 to the Fund and no claim shall
lie against the Company or the Fund in respect of
dividends remaining unclaimed or unpaid and
transferred to the Fund.
Members are hereby informed that the 7 years
period for payment of the dividend pertaining to
financial year 1999-2000 is going to expire on April
27, 2007 and thereafter the amount standing to the
credit in the said account will be transferred to the
‘Investor Education and Protection Fund’ of the
Central Government. Members are therefore
requested to encash the dividend at the earliest.
In case of shares held in physical form the bank
details may be sent to the registrar and share
transfer agents. In case of shares held in demat
form the bank details provided by the Depository
Participant (DP) with whom the demat account
is maintained will be applicable. All previous
instructions given by you to the Company in respect
of ECS and bank details will stand superseded by the
ECS details recorded with your DP.
11.4
Nomination Facility
A member can nominate a person who shall have
all rights of shares and/or amount payable in
respect of shares registered in his name in the event
of his death. This facility is available to the members
of the Company. The said form can be obtained
from the Company’s Share transfer agent or
downloaded from the website of the Company at
www. clariantindia.com.
11.5
Consolidation of folios and avoidance of multiple
folios
Members having multiple folios are requested to
consolidate their folios into single folio and for the
purpose send the original certificates along with a
request to the Share Transfer Agent specifying the
folio number under which they desire to hold the
shares.
11.6
Compliance
The Company has complied with all requirements of
regulatory authorities. No penalties/strictures were
imposed on the Company by Stock Exchanges or
SEBI or any Statutory authority on any matter related
to capital market during the last three years.
12.
Non-Mandatory Requirements
The Company has adopted the non-mandatory
requirements in respect of Shareholder rights
by furnishing half-yearly report to each
shareholder.
Dates of transfer of unclaimed dividend to the Fund
Financial Year
11.3
Date of Payment
Date of completion
of 7 years
1999-2000
28.04.2000
27.04.2007
2000-2001
27.07.2001
26.07.2008
2001-2002
26.07.2002
25.07.2009
2002-2003
25.07.2003
24.07.2010
2003-2004
30.07.2004
29.07.2011
2004-2005
29.07.2005
28.07.2012
2005-2006
27.07.2006
26.07.2013
Bank Mandate
Electronic Clearing Services (ECS) is a method of
payment of dividend whereby the amount due to
investors can directly be credited into their bank
accounts, without having to issue paper
instruments. It is fast and there is no scope for loss
of dividend warrants in transit and possible
fraudulent encashment.
21
DECLARATION
Declaration by the Vice-Chairman & Managing Director under Clause 49 of the Listing Agreement regarding Adherence
to the Code of Conduct
In accordance with sub-clause I (D) of Clause 49 of the Listing Agreement with the Stock Exchanges, I hereby confirm that,
all the Directors and the Senior Management Personnel of the Company have affirmed compliance with their respective
codes of conduct as applicable to them, for the financial period from April to December, 2006.
H. MEIER
CEO/CFO CERTIFICATION
As required by sub clause V of Clause 49 of the Listing Agreement with the Stock Exchanges, we have certified to the
Board that for the Financial period of nine months ended December 31, 2006 the Company has complied with the
requirements of the said sub clause.
H. MEIER
SUNIL K. NAYAK
Chief Financial Officer & Company Secretary
Auditors’ Certificate on Corporate Governance
TO THE MEMBERS OF CLARIANT CHEMICALS (INDIA) LIMITED
We have examined the compliance of conditions of Corporate Governance by Clariant Chemicals (India) Limited, for the
nine months ended December 31, 2006, as stipulated in Clause 49 of the Listing Agreement of the said Company with the
Stock Exchange(s).
The compliance of conditions of Corporate Governance is the responsibility of the management. Our examination was
limited to procedures and implementation thereof, adopted by the Company for ensuring the compliance of the conditions
of Corporate Governance. It is neither an audit nor an expression of opinion on the financial statements of the Company.
In our opinion and to the best of our information and according to the explanations given to us and based on the
representations made by the Directors and the Management, we certify that the Company has complied with the
conditions of Corporate Governance as stipulated in the abovementioned Listing Agreement.
We state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency or
effectiveness with which the Management has conducted the affairs of the Company.
For A. F. FERGUSON & CO.
Chartered Accountants
22
A. C. Khanna
Partner
Membership No.: 17814
Auditors’ Report to the Members
1.
2.
3.
4.
5.
We have audited the attached Balance Sheet of
Clariant Chemicals (India) Limited, as at December 31,
2006 and also the Profit and Loss Account and the
Cash Flow Statement for the nine months period
ended on that date annexed thereto. These financial
statements are the responsibility of the Company’s
management. Our responsibility is to express an
opinion on these financial statements based on our
audit.
We conducted our audit in accordance with auditing
standards generally accepted in India. Those
Standards require that we plan and perform the audit
to obtain reasonable assurance about whether
the financial statements are free of material
misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also
includes assessing the accounting principles used
and significant estimates made by the management,
as well as evaluating the overall financial statement
presentation. We believe that our audit provides a
reasonable basis for our opinion.
knowledge and belief were necessary for the
purposes of our audit;
(b)
in our opinion, proper books of account as
required by law have been kept by the Company,
so far as appears from our examination of the
books;
(c)
the Balance Sheet, Profit and Loss Account and
Cash Flow Statement dealt with by this report
are in agreement with the books of account;
(d)
in our opinion, the Balance Sheet, Profit and
Loss Account and Cash Flow Statement dealt
with by this report comply with the Accounting
Standards referred to in sub-section (3C) of
Section 211 of the Companies Act, 1956;
(e)
in our opinion and to the best of our information
and according to the explanations given to us,
the said accounts give the information required
by the Companies Act, 1956, in the manner so
required and give a true and fair view in
conformity with the accounting principles
generally accepted in India:
On the basis of the written representations received
from the directors, as on December 31, 2006 and taken
on record by the Board of Directors, we report that
none of the directors of the Company are disqualified
as on December 31, 2006 from being appointed as a
director, in terms of clause (g) of sub-section (1) of
Section 274 of the Companies Act, 1956.
As required by the Companies (Auditor’s Report)
Order, 2003 (the ‘Order’) issued by the Central
Government of India in terms of sub-section (4A) of
Section 227 of the Companies Act, 1956, we enclose in
the annexure a statement on the matters specified in
paragraphs 4 and 5 of the said Order to the extent
applicable to the Company.
(i)
in the case of the Balance Sheet, of the
state of affairs of the Company as at
December 31, 2006;
(ii)
in the case of the Profit and Loss Account,
of the profit of the Company for the nine
months period ended on that date; and
(iii)
in the case of the Cash Flow Statement, of
the cash flows for the nine months period
ended on that date.
Further to our comments in the Annexure referred to
in paragraph 4 above, we report that:
(a)
we have obtained all the information and
explanations, which to the best of our
A. C. Khanna
Partner
Mumbai: 22nd February, 2007
Annexure to the Auditors’ Report
(Referred to in paragraph 4 of the Auditors’ Report of even
date to the members of Clariant Chemicals (India) Limited on
the financial statements for the nine months period ended
December 31, 2006.)
(i) (a) The Company has maintained proper records
showing full particulars including quantitative
details and situation of fixed assets.
(b) The Company has a programme of physical
verification of fixed assets. As per the said
programme, certain assets were physically
verified during the year. In our opinion, the
frequency of verification is reasonable having
regard to the size of the Company and the nature
of its assets. According to the information
and explanations given to us, no material
discrepancies were noticed on such verification.
(c)
In our opinion, fixed assets disposed off during
the year were not substantial. Therefore, the
23
provisions of clause 4(i)(c) of the Order are not
(ii)
(a)
The inventories have been physically verified
during the year by the management except for
stocks lying at third party locations for which
confirmations have been obtained and for
goods-in-transit. In our opinion, the frequency of
verification is reasonable.
(b)
The procedures of physical verification of
inventories followed by the management are
reasonable and adequate in relation to the size of
the Company and the nature of its business.
(c)
In our opinion and according to the information
and explanations given to us, the Company is
maintaining proper records of inventory. The
discrepancies noticed on verification between
the physical stocks and the book records were
not material and have been properly dealt with in
the books of account.
(iii) (a)
According to the information and explanations
given to us, the Company has granted an interest
free unsecured loan, repayable on demand to a
company (wholly owned subsidiary) covered in
the register maintained under Section 301 of the
Companies Act, 1956. The maximum amount
involved during the period and the year end
balance was Rs. 735 lakhs.
(b)
and explanations given to us, having regard to the
fact that the company is a wholly owned
subsidiary, the rate of interest and other terms
and conditions are not, prima facie, prejudicial to
the interest of the Company.
(c)
given to us, the interest-free loan repayable on
demand as referred to in (iii)(a) above has not yet
been demanded. Accordingly, sub-clause (d) is
not applicable.
(d)
(iv)
24
given to us, the Company has not taken any loans,
secured or unsecured, from companies, firms or
other parties covered in the register maintained
under Section 301 of the Companies Act, 1956.
Accordingly, sub-clause (f) and (g) are not
applicable.
In our opinion and according to the information and
explanations given to us, having regard to the
explanations that some of the items purchased are of
a special nature and suitable alternatives do not exist
for obtaining comparable quotations, there are
adequate internal control systems commensurate
with the size of the Company and the nature of its
business with regard to purchases of inventory and
fixed assets and with regard to the sale of goods and
services. Further, on the basis of our examination and
according to the information and explanations given
to us, we have neither come across nor have we been
informed of any instance of major weaknesses in the
aforesaid internal control systems.
(v)
(vi)
(a)
and explanations given to us, the particulars
of contracts or arrangements referred to in
Section 301 of the Companies Act, 1956 have been
entered in the register required to be maintained
under that Section.
(b)
In our opinion and according to information and
explanations given to us, the transactions
made in pursuance of such contracts and
arrangements entered in the register maintained
under Section 301 of the Companies Act, 1956
have been made at the prices which are
reasonable having regard to the prevailing
market prices at the relevant time except in case
of some transactions where alternate source of
supply did not exist and therefore, no comparison
of prices was possible.
explanations given to us, the Company has complied
with the provisions of Sections 58A, 58AA or any other
relevant provisions of the Companies Act, 1956 and
the Companies (Acceptance of Deposits) Rules, 1975
with regard to the deposits accepted from the public.
As informed to us, no order has been passed by the
Company Law Board or National Company Law
Tribunal or Reserve Bank of India or any Court or any
other Tribunal.
(vii) In our opinion, the Company has an internal audit
system commensurate with the size of the Company
and nature of its business.
(viii) We have broadly reviewed the books of account
maintained by the Company pursuant to the Rules
made by the Central Government for the maintenance
of cost records under Section 209(1)(d) of the
Companies Act, 1956 and are of the opinion that prima
facie the prescribed records have been maintained
and the prescribed accounts are in the process of
being made up. We have not, however, made a
detailed examination of the records with a view to
determining whether they are accurate or complete.
(ix) (a)
According to the records of the Company,
Provident Fund, Investor Education and
Protection Fund, Employees’ State Insurance,
Income tax, Sales tax, Wealth tax, Service tax,
Custom Duty, Excise Duty, Cess and other
material statutory dues applicable to it have been
Annexure to the
Auditors’ Report
(b)
generally regularly deposited during the year
with the appropriate authorities. According to the
information and explanations given to us, no
undisputed amounts payable in respect of above
were in arrears, as at December 31, 2006 for a
period of more than six months from the date on
which they became payable.
(xiii) In our opinion, the Company is not a chit fund or a
nidhi/mutual benefit fund/society. Therefore, the
provisions of clause 4(xiii) of the Order are not
According to the records of the Company,
Income tax, Sales tax, Wealth tax, Service tax,
Customs duty, Excise duty and Cess as
applicable which have not been deposited on
account of dispute are as follows:
(xiv) In our opinion, the Company is not dealing in or
trading in shares, securities, debentures and
other investments. Accordingly, the provisions of
clause 4(xiv) of the Order are not applicable to the
Company.
(Rs. lakhs)
Name of
Statute
(Nature
of Dues)
Sales Tax
(Tax/Penalty/
Interest)
Period to
which the
amount
Relates
1992-93,
2001-02 to
2003-04
1999-2000
& 1994-95
1996-97 to
1998-99
Total
The Central
Excise Act
(Tax/Penalty/
Interest)
1981-84,
1994-95,
1997-98,
1999-2000
to 2004-05
1999-2000,
2003-04 to
2005-06
Total
Service Tax
2004-05
Total
Income Tax
(Tax/Interest)
2001-02 to
2004-05
1992-93,
1995-96,
1997-98,
2000-01 &
2002-03
Total
Forum where dispute is pending
Commissionarate
Appellate
authorities
& Tribunal
235.91
—
—
235.91
—
24.02
—
24.02
—
—
2.27
2.27
235.91
24.02
2.27
262.20
—
323.20
—
323.20
High Court
Total
amount
263.29
—
—
263.29
263.29
323.20
—
586.49
0.52
11.24
—
11.76
0.52
11.24
—
11.76
335.02
—
—
335.02
—
142.85
—
142.85
335.02
142.85
—
477.87
(x)
The Company does not have any accumulated losses
at the end of the financial period and has not incurred
cash losses during the financial period covered by our
audit and in the immediately preceding financial year.
(xi)
explanations given to us, the Company has not
defaulted in repayment of dues to financial institution,
banks or debenture holders.
(xii) Based on our examination of the records and the
information and explanations given to us, the
Company has not granted any loans and advances on
the basis of security by way of pledge of shares,
debentures and other securities.
(xv) In our opinion and according to the information and
explanations given to us, the Company has not given
any guarantees for loans taken by others from banks
or financial institutions.
(xvi) In our opinion and according to the information and
explanations given to us, no term loans were acquired
during the reporting period by the Company.
(xvii) According to the information and explanations given
to us and on an overall examination of the balance
sheet of the Company, we report that no funds raised
on short-term basis have been used for long-term
investment.
(xviii) According to the information and explanations given
to us, the Company has not made any preferential
allotment of shares to parties and companies covered
in the register maintained under Section 301 of the
Companies Act, 1956.
(xix) The Company has not issued any Secured debentures.
Therefore, the provisions of clause 4(xix) of the Order
are not applicable to the Company.
(xx) The Company has not raised any money by way of
public issue during the year. Therefore, the provisions
of clause 4(xx) of the Order are not applicable to the
Company.
(xxi) According to the information and explanations given
to us, no fraud on or by the Company has been noticed
or reported during the course of our audit.
A. C. Khanna
Partner
25
Balance Sheet
as at 31st December, 2006
31-12-2006
Rs. lakhs
31-03-2006
Rs. lakhs
1
1A
2
2666.07
—
28358.24
31024.31
1165.00
1501.07
30543.90
33209.97
3
4
142.44
478.96
621.40
981.82
32627.53
3597.85
1995.82
5593.67
525.64
39329.28
37516.86
21799.47
15717.39
801.13
16518.52
4650.58
37983.02
22485.44
15497.58
518.82
16016.40
11326.19
Schedule
SOURCES OF FUNDS
Shareholders’ funds
Share capital
Share capital suspense account
Reserves and surplus
Loan funds
Secured loans
Unsecured loans
Deferred Tax Liability - Net (See note 5, Schedule 19)
APPLICATION OF FUNDS
Fixed Assets
5
Gross block
Less : Accumulated depreciation
Net block
Capital work-in-progress and advances, etc.
Investments
Current assets, loans and advances
Inventories
Sundry debtors
Cash and bank balances
Loans and advances
7
8
9
10
12817.66
13735.88
3962.86
6773.86
37290.26
12528.37
14514.50
1388.96
7448.90
35880.73
Less:
Current liabilities and provisions
Liabilities
Provisions
11
12
18612.61
7396.47
26009.08
11281.18
177.25
17164.36
6729.68
23894.04
11986.69
—
32627.53
39329.28
6
Net current assets
Miscellaneous expenditure-Voluntary Retirement Scheme
(To the extent not written off or adjusted) {See note 5 , Schedule 18}
Significant accounting policies
Notes to the accounts
18
19
For and on behalf of the Board,
Per our report attached
R. A. Shah
Chairman
For A.F. Ferguson & Co.
H. Meier
A. C. Khanna
Partner
B. S. Mehta
Diwan A. Nanda
K. J. Bharucha
Sunil K. Nayak
Mumbai, 22nd February, 2007
26
}
Directors
Profit and Loss Account
for the nine months period ended 31st December, 2006
Schedule
INCOME
Sales – Gross
Less: Excise Duty Recovered on Sales
Sales – Net
Add: Processing charges
Turnover
Other income
13
EXPENDITURE
Cost of Materials
Personnel Cost
Interest (Net)
Depreciation/Amortisation
Other expenditure
14
15
16
5
17
Less: Service charges recovered
PROFIT BEFORE TAXATION
Provision for taxation
Current Tax
Deferred Tax
Fringe Benefit Tax
(Excess)/Short provision for taxation in respect of earlier years
PROFIT AFTER TAXATION
Balance brought forward from last year
Add : Transfer in terms of amalgamation (See note 1(a), Schedule 19)
Available for appropriation
APPROPRIATED AS FOLLOWS
General reserve
Proposed dividend
Corporate tax on proposed dividend
Balance carried to the Balance Sheet
Basic and Diluted earnings per share (in Rupees)
(See note 4, Schedule 19)
18
19
19
April 06 to
December 06
Rs. lakhs
75389.35
6684.88
68704.47
—
68704.47
2431.75
71136.22
92465.33
7673.87
84791.46
804.69
85596.15
2812.72
88408.87
45496.75
5495.56
(6.75)
1534.86
14044.23
66564.65
505.93
66058.72
5077.50
55611.62
7032.73
4.15
2446.99
17368.64
82464.13
538.91
81925.22
6483.65
1250.00
456.18
85.00
—
3286.32
3866.49
—
7152.81
2238.25
37.66
227.89
(59.33)
4039.18
2863.00
1308.30
8210.48
330.00
4798.93
673.05
1350.83
7152.81
1000.00
2932.68
411.31
3866.49
8210.48
12.33
15.15
(Not
annualised)
10.00
Face value per share (in Rupees)
April 05 to
March 06
Rs. lakhs
(Annualised)
10.00
Per our report attached to the Balance Sheet
R. A. Shah
Chairman
H. Meier
A. C. Khanna
Partner
B. S. Mehta
Diwan A. Nanda
K. J. Bharucha
Sunil K. Nayak
}
Directors
27
Cash Flow Statement for the nine months period ended 31st December, 2006
A.
April 06 to
December 06
Rs. lakhs
April 05 to
March 06
Rs. lakhs
5077.50
6483.65
1534.86
2446.99
6.34
25.78
Interest income
(211.92)
(480.97)
Dividend income
(61.44)
(297.82)
Loss/(profit) on sale of assets (Net)
(32.62)
CASH FLOW FROM OPERATING ACTIVITIES :
Net Profit before tax and Extra ordinary items
Adjustments for :
Depreciation
Unrealised foreign exchange (gain)/loss (Net)
Adjustment on Sale of Land
Loss/(profit) on sale of Investments (Net)
Amortisation of Voluntary Retirement Scheme compensation
Provision for Diminution in value of investment written back
—
(56.98)
117.74
(43.05)
(54.69)
10.43
—
—
(0.53)
Provision for Doubtful debts written back (Net)
(71.58)
(139.27)
Provision for Leave encashment
(92.21)
127.15
Provision for Ex-Gratia Gratuity
2.88
15.55
—
741.50
Provision for Stamp Duty in connection with Integration
0.80
40.27
205.17
485.12
—
0.14
121.93
147.18
6447.09
9600.81
Trade and other receivables
2206.61
548.65
Payment of Voluntary Retirement Scheme compensation
(187.68)
—
Inventories
(289.29)
(1744.10)
(53.30)
531.11
Provision for Gratuity
Interest expenses
Investment written-off
Assets written-off
Operating profit before working capital changes
Adjustments for :
Trade, other payables and Provisions
Cash generated from operations
Direct taxes paid – (Net of refunds)
Net cash from operating activities
B.
8123.43
8936.47
(1521.37)
(2697.79)
6602.06
6238.68
(2215.09)
(3342.83)
CASH FLOW FROM INVESTING ACTIVITIES :
Purchase of fixed assets
136.48
190.97
(13623.56)
(42141.12)
(60.00)
(281.48)
20402.22
40963.94
(295.57)
(475.00)
Interest received
70.13
659.18
Dividend received
61.44
297.82
4476.05
(4128.52)
Sale of fixed assets
Purchase of investments
Investment in subsidiaries
Sale of investments
Loans and advances to subsidiary
Net cash from/(used in) investing activities
28
Cash Flow Statement
C.
April 06 to
December 06
Rs. lakhs
April 05 to
March 06
Rs. lakhs
(3330.41)
571.02
—
(2470.00)
CASH FLOW FROM FINANCING ACTIVITIES :
Cash credit & Packing credit (Net)
Reduction of Share Capital of erstwhile BTP India Private Limited
—
12381.23
(1641.86)
(12622.16)
(207.75)
(501.96)
Dividend/dividend tax paid
(3324.19)
(2316.67)
Net cash used in financing activities
(8504.21)
(4958.54)
NET INCREASE IN CASH AND CASH EQUIVALENTS (A+B+C)
2573.90
(2848.38)
CASH AND CASH EQUIVALENTS AS AT BEGINNING OF THE PERIOD
1388.96
367.81
—
3869.53
3962.86
1388.96
Proceeds from borrowings
Repayment of borrowings
Interest paid
CASH AND CASH EQUIVALENTS – TAKEN OVER ON AMALGAMATION
CASH AND CASH EQUIVALENTS AS AT THE END OF THE PERIOD
Notes :
1.
The Cash Flow Statement has been prepared under the “Indirect Method” as set out in Accounting Standard-3 on Cash Flow Statement
issued by the Institute of Chartered Accountants of India.
2.
Direct taxes paid are treated as arising from operating activities and are not bifurcated between investing and financing activities.
3.
Cash and Bank balances includes Rs. NIL (Previous Year – Rs. 5.50 lakhs) which is not available for use by the Company.
4.
The figures of current reporting period of nine months ended December 31, 2006 are not strictly comparable with the figures relating to
previous reporting period of twelve months ended March 31, 2006.
5.
Figures for the previous year have been regrouped wherever necessary to conform to this period’s classification.
R. A. Shah
Chairman
H. Meier
A. C. Khanna
Partner
B. S. Mehta
Diwan A. Nanda
K. J. Bharucha
Sunil K. Nayak
}
Directors
29
Schedules forming part of the Balance Sheet
SCHEDULE 1 : SHARE CAPITAL
Authorised
30000000 equity shares of Rs. 10/- each
Issued and subscribed
26660745 (Previous year : 11650000) equity shares of Rs. 10/- each fully paid
31-12-2006
Rs. lakhs
31-03-2006
Rs. lakhs
3000.00
3000.00
2666.07
1165.00
31-12-2006
Rs. lakhs
31-03-2006
Rs. lakhs
—
1501.07
31-12-2006
Rs. lakhs
31-03-2006
Rs. lakhs
730.11
—
0.10
27.16
—
730.11
702.85
730.11
137.50
137.50
3545.65
—
3545.65
2023.50
1522.15
3545.65
20.00
—
20.00
—
20.00
20.00
22244.15
330.00
—
22574.15
1350.83
28358.24
11033.34
1000.00
10210.81
22244.15
3866.49
30543.90
Notes:
Of the above:
(a) 15010745 equity shares issued as fully paid up pursuant to a contract for a
consideration other than cash.
(b) 8167080 equity shares are held by EBITO Chemiebeteiligungen AG.
6075000 (Previous year : NIL) equity shares are held by Clariant International AG.
2660000 (Previous year : NIL) equity shares are held by Clariant Participations AG.
The ultimate holding company being Clariant AG, Switzerland.
(c) 6690610 equity shares were allotted as fully paid up bonus shares by capitalisation of
Rs. 669.06 lakhs from general reserve.
SCHEDULE 1A : SHARE CAPITAL SUSPENSE ACCOUNT
Share capital suspense
Note:
In terms of the scheme of amalgamation in the previous year between Clariant (India) Limited,
Vanavil Dyes and Chemicals Limited, Kundalika Investments Limited, BTP India Private Limited,
the transferor companies and the Company, 15010745 equity shares of Rs. 10/- each fully paid,
were issued during the period to the shareholders of the transferor companies whose names appeared
on their register of members on the record date viz 21st April, 2006.
Of the above:
(i) 6075000 equity shares were issued to Clariant International AG.
(ii) 2660000 equity shares were issued to BTP Limited, UK.
SCHEDULE 2 : RESERVES AND SURPLUS
Capital reserve
As per last Balance Sheet
Add : Transfer in terms of amalgamation *
Add : Excess of share capital of transferor companies over
the amount credited by the company to the share capital *
Capital redemption reserve
Securities premium account
Investment allowance reserve
General reserve
Add : Transfer from Profit and Loss Account
Add : Transfer in terms of amalgamation (Net of adjustments) *
* (See note 1(a), Schedule 19)
30
Schedules forming part of the
Balance Sheet
SCHEDULE 3 : SECURED LOANS
31-12-2006
Rs. lakhs
31-03-2006
Rs. lakhs
142.44
3472.85
—
125.00
142.44
3597.85
31-12-2006
Rs. lakhs
31-03-2006
Rs. lakhs
—
1000.00
—
475.00
478.96
478.96
520.82
1995.82
From banks :
Short Term Loan :
Rs. 142.44 lakhs (Previous year : Rs. 3432.00 lakhs) secured by hypothecation of present
and future stock-in-trade and spare parts, loose tools, book debts, outstanding monies,
receivables, claims, bills, right to or in movable properties and movable assets, etc.
Rs. NIL (Previous year : Rs. 40.85 lakhs) secured by way of first charge on inventories
and book debts, both present and future, and by second charge on other movable
and immovable properties, both present and future.
Term Loan :
(Repayable within one year Rs. NIL, Previous year : Rs. 100 lakhs)
(Secured by first charge on plant and machinery)
SCHEDULE 4 : UNSECURED LOANS
Privately placed Non-convertible debentures :
9% Non-convertible debentures redeemable at par (Redeemed on 12th April, 2006)
Other Loans :
From banks :
Short Term Loan
From others :
Interest-free sales tax deferral scheme granted by
State Industries Promotion Corporation of Tamil Nadu Limited
SCHEDULE 5 : FIXED ASSETS
Rs. lakhs
GROSS BLOCK
As at
31-03-2006
DEPRECIATION/AMORTISATION
Transfer in
terms of
As at
amalgamaSales and
tion * Additions deductions 31-12-2006
As at
31-03-2006
—
379.17
379.17
Transfer in
terms of
amalgama- Sales and
tion * deductions
NET BLOCK
For the
period
As at
(See note 3
below) 31-12-2006
As at
31-12-2006
As at
31-03-2006
379.17
—
—
80.49
Intangible Assets
Software license fees
379.17
—
—
—
—
—
Tangible Assets
Land freehold
80.49
—
—
—
80.49
—
—
—
—
—
80.49
Land leasehold
14.87
—
—
—
14.87
4.06
—
—
0.12
4.18
10.69
10.81
5987.42
—
191.57
47.34
6131.65
2297.16
—
5.78
(280.12)
2011.26
4120.39
3690.26
28754.73
—
1676.66
2008.96
28422.43
18431.00
—
1922.69
1510.63
18018.94
10403.49
10323.73
Buildings
Plant, machinery,
equipment etc.
Furniture, fixtures and
office appliances
1719.64
—
96.26
244.96
1570.94
946.46
—
194.73
114.47
866.20
704.74
773.18
Vehicles
1046.70
—
15.97
145.36
917.31
427.59
—
97.63
189.76
519.72
397.59
619.11
15717.39
Total
37983.02
—
1980.46
2446.62
37516.86
22485.44
—
2220.83
1534.86
21799.47
Previous year
20647.00
15518.50
2954.87
1137.35
37983.02
12683.51
8211.12
856.18
2446.99
22485.44
15497.58
Capital work-in-progress
642.14
Advances against capital orders
158.99
35.71
801.13
518.82
16518.52
16016.40
483.11
Notes :
1. Buildings include :
Rs. 0.12 lakh (Previous year : Rs. 0.12 lakh) being the cost of shares and bonds in co-operative housing societies.
Rs. 600 (Previous year : Rs. 1200) being the cost of shares yet to be allotted.
2. * Transfers after adjustments as on April 1, 2005 pursuant to the scheme of amalgamation. (See note 1(a), Schedule 19)
3. See note 28 and 29, Schedule 19.
31
SCHEDULE 6 : INVESTMENTS (AT COST)
Long Term
Non-trade - Unquoted
38250 (Previous year : 38250) 5.15% Rural Electrification Corporation Limited Bonds of
Rs. 10000/- each fully paid up
In fully paid units of Rs. 10/- each
(Acquired pursuant to Scheme of Amalgamation) *
NIL (Previous year : 1000000) TATA Fixed Horizion Series 1 - Plan A (371 days) - Growth
NIL (Previous Year : 2000000) JM Fixed Maturity Plan - YS01 - Growth Option (133)
NIL (Previous Year : 2000000) Reliance Fixed Maturity Fund - Annual Plan - Series 1 - Growth Option
Long Term - Non-trade - Unquoted
Trade
In Subsidiary Company - Unquoted
500000 (Previous year : 500000) fully paid equity shares of Rs. 10/- each
in Chemtreat Composites India Pvt. Ltd. (See note 15, Schedule 19)
{Acquired during the previous year}
Long Term - Trade - Unquoted
Total Long Term
Current
Non-trade - Unquoted
31-12-2006
Rs. lakhs
31-03-2006
Rs. lakhs
3825.00
3825.00
—
—
—
3825.00
200.00
100.00
200.00
4325.00
325.00
325.00
4150.00
265.00
265.00
4590.00
NIL (Previous Year : 5049182) Principal PNB - Fixed Maturity Plan - 91 Days - Series I
NIL (Previous Year : 3484111) Canliquid Fund - Institutional - Daily Dividend Reinvest
NIL (Previous Year : 5562056) Kotak FMP - Series XVI - Dividend
NIL (Previous Year : 5505854) LIC MF Liquid Fund - Dividend Plan
NIL (Previous Year : 13788661) LIC MF Floating Rate Fund - Short Term Plan - Dividend Plan
NIL (Previous Year : 7476901) UTI Money Market Fund Daily Dividend Option
NIL (Previous Year : 4053920) Prudential ICICI FMP - Yearly - Series XXV - Dividend
4493133 (Previous Year : NIL) Reliance Liquid Fund - Cash Plan - Dividend Reinvestment
NIL (Previous Year : 162429) DSP Merrill Lynch Liquidity Fund - Institutional - Daily Dividend
Current - Non-trade - Unquoted
Total Investments
—
—
—
—
—
—
—
500.58
504.92
349.84
556.21
602.79
1389.48
1302.95
405.39
—
—
500.58
4650.58
1624.61
6736.19
11326.19
* (See note 1 (a), Schedule 19)
Aggregate value of unquoted investments
4650.58
11326.19
The following are the Investments which have been purchased and sold during the period :
April 06 - December 06
Nos.
Rs. lakhs
Non trade Current - unquoted
JM Money Manager Super Plus Plan
Principal PNB Fixed Maturity Plan - 91 Days Series I
Canliquid Fund - Institutional - Daily Dividend Reinvest
Kotak Liquid (Institutional Premium) - Daily Dividend
Kotak FMP Series XVI - Dividend
LICMF Liquid Fund - Dividend Plan
LIC MF Floating Rate Fund - Short term Plan - Dividend Plan
Deutsche Insta Cash Plus
Deutsche Insta Cash Plus Institutional
UTI - Money Market Fund Daily Dividend Option
32
3002431
18682
9565442
2173384
25194
17790479
12558
8745301
24935129
2055484
300.24
1.87
960.47
265.76
2.52
1953.41
1.27
900.85
2498.37
358.27
Balance Sheet
SCHEDULE 6 : INVESTMENTS (AT COST) Continued
The following are the investments which have been purchased and sold during the period :
Reliance Floating Rate Fund - Daily Dividend Plan
Reliance Treasury Institutional Option - Daily Dividend Option
Reliance Liquid Fund - Cash Plan - Daily Dividend Option
Prudential ICICI Liquid Plan Institutional Plus - Daily Dividend Option
Prudential ICICI FMP - Yearly Series XXV - Dividend
Birla Cash Plus - Institutional Daily Dividend Reinvestment
Birla Cash Plus - Institutional Premium Daily Dividend Reinvestment
DSP Merrill Lynch Liquidity Fund - Institutional - Daily Dividend
TATA Liquid Super High Investment Fund - Daily Dividend
UTI Liquid Cash Plan Institutional - Daily Income Option
UTI Liquid Cash Plan Institutional Premium - Daily DIV Reinvestment
Standard Chartered Liquidity Manager Plus - Daily Dividend
April 06 - December 06
Nos.
Rs. lakhs
5723899
575.93
657180
100.43
5385465
600.00
2414752
286.18
12932
1.29
928466
100.30
16766789
1679.95
480
104878
63815
49088
25044
4.80
1129.63
650.54
500.43
250.47
SCHEDULE 7 : INVENTORIES
At lower of cost and net realisable value (As certified by the Management)
Stores and spare parts
Raw materials
Packing materials
Finished goods
Work-in-progress
31-12-2006
Rs. lakhs
31-03-2006
Rs. lakhs
400.96
4131.64
130.85
6851.83
1302.38
12817.66
324.91
3586.00
102.45
6762.46
1752.55
12528.37
31-12-2006
Rs. lakhs
31-03-2006
Rs. lakhs
947.83
83.08
1030.91
1072.84
17.67
1090.51
12424.35
361.50
13311.26
265.19
12785.85
13816.76
80.88
13735.88
13576.45
14666.96
152.46
14514.50
SCHEDULE 8 : SUNDRY DEBTORS
Secured
(Considered good)
Under six months
Over six months
Unsecured
Under six months (Considered good)
Over six months (Including doubtful debts Rs. 80.88 lakhs;
Previous year : Rs. 152.46 lakhs; balance considered good)
Less: Provision for doubtful debts
33
SCHEDULE 9 : CASH AND BANK BALANCES
Cash on hand
Cheques on hand
With scheduled banks :
On current accounts
On Margin accounts
On fixed deposit accounts
31-12-2006
Rs. lakhs
31-03-2006
Rs. lakhs
14.18
2777.35
10.02
168.62
1170.58
—
0.75
1171.33
3962.86
782.35
22.07
405.90
1210.32
1388.96
31-12-2006
Rs. lakhs
31-03-2006
Rs. lakhs
770.57
3309.53
171.76
1727.66
794.34
6773.86
475.00
4799.83
102.03
1472.42
599.62
7448.90
31-12-2006
Rs. lakhs
31-03-2006
Rs. lakhs
—
17188.27
178.81
15589.62
1296.89
0.18
122.63
1.28
3.36
18612.61
1282.21
2.76
102.83
1.49
6.64
17164.36
31-12-2006
Rs. lakhs
31-03-2006
Rs. lakhs
652.82
279.88
90.03
745.03
329.12
87.15
901.76
—
—
4798.93
673.05
7396.47
832.89
650.00
741.50
2932.68
411.31
6729.68
SCHEDULE 10 : LOANS AND ADVANCES
(Unsecured - considered good, unless otherwise stated)
Advances and loans to a subsidiary (See note 17, Schedule 19)
Advances recoverable in cash or in kind or for value to be received
VAT set off admissible
Advance payment of Income tax (Net of Provision for taxation)
Balances with Customs and Excise on current account
SCHEDULE 11 : CURRENT LIABILITIES
Acceptances
Sundry creditors
(Includes Rs. 2137.42 lakhs; Previous year Rs. 2069.80 lakhs due to small scale industrial units)
{See note 12, Schedule 19}
Deposits
Interest accrued but not due on loans
Unpaid dividends*
Unclaimed fixed deposits*
Unpaid interest on matured fixed deposits*
* There is no amount due and outstanding to be credited to Investor Education and Protection Fund
SCHEDULE 12 : PROVISIONS
Retirement Benefits:
Leave encashment
Gratuity
Ex-gratia Gratuity
Others:
Provision for taxation (Net of advance payment of Income tax)
Provision for unearned premium*
Provision for stamp duty in connection with Integration*
Proposed dividend
Corporate Tax on proposed dividend
* (See note 6, Schedule 19)
34
Schedules forming part of the Profit and Loss Account
SCHEDULE 13 : OTHER INCOME
April 06 to
December 06
Rs. lakhs
—
61.44
253.50
32.62
24.87
256.14
279.06
48.19
71.58
9.81
33.24
1361.30
2431.75
April 05 to
March 06
Rs. lakhs
3.27
294.55
404.60
56.98
16.81
346.56
421.88
—
139.27
15.17
39.52
1074.11
2812.72
April 06 to
December 06
Rs. lakhs
29873.42
1662.40
April 05 to
March 06
Rs. lakhs
33135.97
1790.84
13600.13
21545.91
Finished goods
Add : Transfer in terms of scheme of amalgamation *
6762.46
—
6762.46
3173.96
3008.06
6182.02
Work-in-progress
1752.55
—
1752.55
8515.01
1028.64
443.25
1471.89
7653.91
6851.83
1302.38
6762.46
1752.55
8154.21
360.80
45496.75
8515.01
(861.10)
55611.62
April 06 to
December 06
Rs. lakhs
4313.47
April 05 to
March 06
Rs. lakhs
5040.38
Dividend on long term non-trade investments
Dividend on current non-trade investments
Export Incentives
Profit on sale of fixed assets (Net)
Cash discounts
Rental income
Indenting commission
Exchange Gain (Net)
Provision for doubtful debts written back (Net)
Profit on sale/changes in the carrying amount of current investments (Net)
Profit on sale/changes in the carrying amount of long term investments (Net)
Miscellaneous (See note 27(a), Schedule 19)
SCHEDULE 14 : COST OF MATERIALS
Raw materials consumed
Packing materials consumed
Purchase of finished goods (Previous year : Net of goods destroyed in flood)
(Increase)/Decrease in stocks of finished goods and work-in-progress :
Opening stock
Less : Closing stock
Finished goods
Work-in-progress
SCHEDULE 15 : PERSONNEL COST
Salaries, wages, bonus, etc.
10.43
—
Contribution/Provision for provident fund, superannuation scheme, gratuity fund, etc.
(See note 27 (b), Schedule 19)
583.24
1189.60
Welfare expenses
606.50
829.71
5513.64
7059.69
18.08
26.96
5495.56
7032.73
Less : Charged to capital accounts
35
SCHEDULE 16 : INTEREST (NET)
Interest Paid
On loans for fixed period
Others
Less : Interest received (Gross) :
(Tax deducted at source Rs. 14.91 lakhs; Previous year : Rs. 37.93 lakhs)
On Investments – Long Term Non-trade
Others
April 06 to
December 06
Rs. lakhs
April 05 to
March 06
Rs. lakhs
4.62
200.55
205.17
135.34
349.78
485.12
148.42
63.50
211.92
(6.75)
196.99
283.98
480.97
4.15
April 06 to
December 06
Rs. lakhs
615.66
April 05 to
March 06
Rs. lakhs
1100.99
560.84
248.04
171.50
3400.74
373.88
394.89
197.16
1375.07
671.71
207.23
619.14
1449.48
74.72
—
121.93
108.95
172.43
—
—
—
3280.86
14044.23
782.59
454.94
324.71
3677.13
424.10
559.31
291.32
1459.47
853.39
280.51
715.60
1743.88
80.93
117.74
147.18
141.03
47.84
35.57
130.84
925.85
3073.72
17368.64
SCHEDULE 17 : OTHER EXPENDITURE
Stores and Spare parts etc. consumed
Repairs and maintenance:
Plant and machinery
Buildings
Others
Power and fuel
Rent (including lease payments) {See note 8, Schedule 19}
Rates and taxes (including water charges)
Insurance
Clearing, Forwarding and transport
Travelling and Conveyance
Commission
Cash Discount
Other discounts on sales
Brokerage on exports
Assets written-off
Bad debts and advances written off
Excise Duty (Net)
Exchange Loss (Net)
Flood Loss (Net)
Integration Expenses (See note 27 (c), Schedule 19)
Miscellaneous (See note 13, Schedule 19)
36
Notes
Notes
Schedule 18
Forming Part of the Balance Sheet and Profit and Loss Account for the nine months period ended 31st December, 2006
SIGNIFICANT ACCOUNTING POLICIES
The financial statements are prepared at historical cost on the accrual basis of accounting and in accordance with the standards on accounting
issued by the Institute of Chartered Accountants of India and referred to in Section 211(3C) of the Companies Act, 1956. The significant accounting
policies are as follows :
1.
SALES
The Company recognises sale of goods on despatch to customers. Sales are net of excise duty, sales tax and trade discounts, wherever applicable.
2.
EXCISE DUTY
Excise duty payable on products is accounted for at the time of despatch of goods from the factories but is accrued for stocks held at the year end.
3.
RESEARCH AND DEVELOPMENT
Revenue expenditure on research and development is written off in the profit and loss account in the year in which it is incurred. Capital
expenditure on research and development is treated in the same way as expenditure on fixed assets.
4.
RETIREMENT BENEFITS
(a)
Retirement benefits to employees comprise of payment to gratuity, superannuation and provident funds and ex-gratia gratuity under the
rules of the Company.
(b)
Liabilities in respect of retirement gratuity benefit to employees are provided in terms of The Payment of Gratuity Act, 1972 or the Company’s
Gratuity Scheme approved by the Commissioner of Income-tax, whichever is beneficial. The adequacy of the fund is confirmed by an
actuarial valuation obtained at the year end.
Contributions for superannuation made to LIC under the Company’s Superannuation Scheme are charged to the Profit and Loss Account.
Contributions to the Provident Funds are made at a pre-determined rate and charged to the Profit and Loss Account.
(c)
5.
Liabilities in respect of leave encashment benefit and ex-gratia gratuity payable on retirement to a category of employees, are provided
based on an actuarial valuation obtained at the year end and charged to the Profit and Loss Account.
VOLUNTARY RETIREMENT SCHEME
Expenditure incurred on voluntary retirement scheme is amortised over a period of three years. (See Note 30, Schedule 19)
6.
7.
FIXED ASSETS AND DEPRECIATION
(A)
All fixed assets are stated at cost less depreciation, wherever applicable. Cost comprises the purchase price and any other attributable
cost of bringing the asset to its working condition for its intended use. Borrowing cost relating to funds borrowed for acquisition of
qualifying assets for the year upto the date the assets are put to use is included in cost.
(B)
The cost of leasehold land is amortised over the period of the lease.
(C)
Intangible assets are being amortised equally over a period of three years.
(D)
Depreciation has been calculated on the straight line method at the rates and in the manner specified in Schedule XIV of the Companies Act,
1956 except for :
(a)
certain items of furniture, fixture, vehicle, plant, machinery and equipment on which a depreciation rate of 20% on straight line method is
applied,
(b)
electronic data processing (EDP) hardware such as servers on which a depreciation rate of 20% and for other EDP equipments including
personal computers and printers on which depreciation rate of 25% on straight line method is applied.
(c)
Exchange differences capitalised which are depreciated over the remaining useful life of the assets. (See note 28 and 29, Schedule 19)
IMPAIRMENT OF ASSETS
The carrying amounts of assets are reviewed at each Balance Sheet date if there is any indication of impairment based on internal/external
factors. An impairment loss will be recognised wherever the carrying amount of an asset exceeds its estimated recoverable amount. The
recoverable amount is greater of the asset’s net selling price and value in use. In assessing the value in use, the estimated future cash flows are
discounted to the present value using the weighted average cost of capital. Previously recognised impairment loss is further provided or
reversed depending on changes in circumstances.
8.
INVENTORIES
Inventories are valued at the lower of cost and estimated net realisable value after providing for obsolescence. The cost of inventories is
generally arrived at on the following bases :
Raw materials, packing materials, trading items and stores and spares
–
Weighted average cost.
Finished goods and work-in-progress
–
Absorption costing at works cost.
37
9. SUNDRY DEBTORS/LOANS AND ADVANCES
Sundry debtors and loans and advances are stated after making adequate provision for doubtful debts/advances.
10. INVESTMENTS
Long term investments are stated at cost less provision for diminution in value, other than temporary. Current investments are stated at the lower
of cost and fair value. Dividends are accounted for when the right to receive the dividend payment is established.
11.
LEASES
Leases where the lessor effectively retains substantially all the risks and benefits of ownership of the leased assets are classified as operating
leases. Operating lease payments are recognised as an expense in the Profit and Loss Account on a straight-line basis over the lease term.
12. FOREIGN CURRENCY TRANSLATIONS
(a)
Monetary items denominated in foreign currency are translated at the exchange rate prevailing on the last day of the accounting year. In
respect of items covered by forward contracts, the premium or discount arising at the inception of such a forward exchange contract is
amortised as expense or income over the life of the contract. Any profit or loss arising on cancellation of such a forward exchange contract
is recognised as income or expense for the period. Foreign currency transactions are accounted at the rate prevailing on the date of
transaction.
(b)
Non-monetary items other than fixed assets, which are carried in terms of historical cost denominated in a foreign currency are reported
using the exchange rate at the date of transaction.
(c)
Gain or loss arising out of translation/conversion is taken credit for or charged to the Profit and Loss Account except exchange differences
arising due to repayment or restatement of liabilities incurred for the purpose of acquiring of fixed assets in respect of transactions in
foreign currencies entered into prior to April 1, 2004 and in respect of any fixed asset that has been acquired from a country outside India,
in which case the exchange differences are adjusted in the carrying amount of the respective fixed assets.
13. INCOME TAX
Income-tax expense comprises current tax and deferred tax charge or credit. The current tax is determined as the amount of tax payable in
respect of the estimated taxable income for the period. The deferred tax charge or credit is recognised using prevailing enacted or substantively
enacted tax rates. Where there are unabsorbed depreciation or carry forward losses, deferred tax assets are recognised only if there is virtual
certainty of realisation of such assets. Other deferred tax assets are recognised only to the extent there is reasonable certainty of realisation in
future. Deferred tax assets/liabilities are reviewed at each Balance Sheet date based on developments during the year and available case laws,
to reassess realisation/liabilities.
14. CONTINGENCIES/PROVISIONS
Provision is recognised when the Company has a present obligation as a result of past event; it is probable that an outflow of resources
embodying economic benefit will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are not
discounted to its present value and are determined based on best estimate of the expenditure required to settle the obligation at the Balance
Sheet date. These are reviewed at each Balance Sheet date and adjusted to reflect the current best estimate. A contingent liability is disclosed,
unless the possibility of an outflow of resources embodying the economic benefit is remote.
Schedule 19
Notes on the Balance Sheet and Profit and Loss Account for the nine months period ended 31st December 2006
1.
(a)
In accordance with the Scheme of Amalgamation (‘the Scheme’) of erstwhile Clariant (India) Limited, Vanavil Dyes and Chemicals Limited,
BTP India Private Limited and Kundalika Investments Limited (herein after referred to as the “Transferor Companies”) with the Company as
approved by the members at a Court convened Extra Ordinary General Meeting held on 8th December, 2005 and subsequently sanctioned
by the Honourable High Court of Judicature at Madras on 22nd February, 2006 and Honourable High Court of Judicature at Bombay on
24th February, 2006 which was modified vide order dated 17th March, 2006, the entire business and the whole of the undertaking of the
Transferor Companies being all its assets and properties and all its debts and liabilities as defined in the Scheme have been transferred to
and vested in the Company retrospectively with effect from 1st April, 2005. The Scheme had accordingly been given effect to in the previous
accounting year.
(b)
The Board of Directors in their meeting held on 14th September, 2006 had decided to change the accounting year from financial year
April- March to calendar year January-December. Accordingly, the Company has closed its accounting year for a period of 9 months ended
31st December, 2006.
In view of the above, the figures of current reporting period of 9 months ended 31st December, 2006 are not strictly comparable with the
figures relating to previous reporting period of 12 months ended 31st March, 2006.
2.
Segment Information for the nine months period ended 31st December, 2006 (As required by Accounting Standard (AS)-17 “Segment
Reporting”)
(a) The Company is organised into three primary business segments mainly :
(i)
Intermediates and Colours :
Consist of pigment dyestuffs and their dispersion, Intermediates for dyes, pesticides and pharmaceuticals
38
Notes
(ii)
Dyes and Specialty Chemicals :
Includes dyestuff synthetic resins, binder materials, auxiliaries and chemicals
(iii) Masterbatches :
Covers commodity and specialty Masterbatches for Plastics and nylon fibers
(b)
The secondary segments of the Company are geographical segments mainly:(i) India
(ii) Outside India
(c)
Segments have been identified and reported taking into account the nature of products and services, the differing risk and returns, the
organisation structure, and the internal financial reporting system.
(d)
Segment Revenue in each of the above Business Segments primarily includes Sales and Processing charges.
(e)
(i)
Segment Revenue and Results :
The expenses which are not directly attributable to the business segment are shown as unallocated corporate cost.
(ii) Segment assets and liabilities :
Segment assets include all operating assets used by the business segment and consist principally of fixed assets, debtors and
inventories. Segment liabilities primarily include creditors and other liabilities.
(iii) Assets and liabilities that cannot be allocated among the segments are shown as a part of unallocable corporate assets and liabilities
respectively.
Information about Primary Business Segments :
April 06 to December 06
Rs. lakhs
Inter- Dyes and
mediates Specialty
& Colours Chemicals
Revenue
External Sales/Revenue
Less: Inter Segment Revenue
Total Revenue (Net)
Results
April 05 to March 06
Rs. lakhs
Masterbatches
Total
Inter- Dyes and
mediates Specialty
& Colours Chemicals
Masterbatches
Total
25563.37
—
25563.37
41350.61
—
41350.61
1790.49
—
1790.49
68704.47
—
68704.47
35510.33
—
48401.28
—
1684.54
—
85596.15
—
35510.33
48401.28
1684.54
85596.15
1073.15
4804.66
244.48
6122.29
(1112.98)
5009.31
273.36
(205.17)
5077.50
(1706.18)
(85.00)
3286.32
1531.88
6360.43
125.52
8017.83
(1827.85)
6189.98
778.79
(485.12)
6483.65
(2216.58)
(227.89)
4039.18
19752.77
22421.43
1355.84
23405.49
21848.58
1123.85
7978.22
9773.31
336.06
7518.50
8885.87
280.33
Capital Expenditure
Unallocated Corporate Capital Expenditure
Total Capital Expenditure
625.32
852.60
121.57
1970.08
935.53
72.71
Depreciation
Unallocated Corporate Depreciation
Total Depreciation/Amortisation
869.62
569.72
56.19
43530.04
13201.66
56731.70
18087.59
1547.75
19635.34
1599.49
663.28
2262.77
1495.53
39.33
1534.86
1321.45
884.24
59.05
46377.92
15372.98
61750.90
16684.70
3032.46
19717.16
2978.32
35.32
3013.64
2264.74
182.25
2446.99
0.35
55.50
3.96
59.81
87.87
136.69
9.91
Segment Results
Unallocated Corporate Expenses (Net)
Operating P rofits
Interest Income/Dividend Income
Interest Expenses
Profit Before Taxation
Current Tax/Deferred Tax
Fringe Benefit Tax
Profit After Tax
Other Information
Segment Assets
Unallocated Corporate Assets
Total Assets
Segment Liabilities
Unallocated Corporate Liabilities
Total Liabilities
Non cash expenses other than
Unallocated Corporate Non cash expenses
other than Depreciation/Amortisation
Total Non cash expenses other than
234.47
8.07
831.49
67.88
1065.96
39
Information about Secondary Segments :
Rs. lakhs
Revenue by Geographical Market
Rs. lakhs
India
Outside
India
Total
India
Outside
India
External Sales
52302.59
16401.88
68704.47
62201.88
23394.27
85596.15
Segment Assets
Additions to Fixed Assets
39726.59
1599.49
3803.45
—
43530.04
1599.49
43224.75
2978.32
3153.17
—
46377.92
2978.32
Total
Footnotes:
1
2
3.
Total assets do not include :
(a)
Advance income tax Rs. 1727.66 lakhs (Rs. 1472.42 lakhs)
(b)
Miscellaneous Expenditure Rs. 177.25 lakhs (Rs. NIL)
Total Liabilities exclude the following :
(a)
Proposed dividend Rs. 4798.93 lakhs (Rs. 2932.68 lakhs)
(b)
Tax on dividend Rs. 673.05 lakhs (Rs. 411.31 lakhs)
(c)
Provision for Taxation Rs. 901.76 lakhs (Rs. 832.89 lakhs)
(d)
Deferred Tax liability (Net) Rs. 981.82 lakhs (Rs. 525.64 lakhs)
Related Party Disclosure as required by Accounting Standard-18 “Related Party Disclosures” are given below:
Relationship :
(a)
Holding Company :
EBITO Chemiebeteiligungen AG, Clariant International AG and Clariant Participations AG, Switzerland together hold 63.40% equity shares in
the Company, the ultimate holding company being Clariant AG, Switzerland.
(b)
Subsidiary of the Company :
The Company has subsidiary Chemtreat Composites India Pvt. Ltd. – 100% shareholding (w.e.f. 13th February, 2006)
(c)
Other related parties in the Clariant group where common control exists :
Fellow Subsidiaries Companies :
Clariant Life Science Molecules (Florida) Inc., USA
40
Clariant Participations B.V., Netherlands
Clariant Life Science Molecules (America) Inc., USA
Clariant (Oesterreich) GmbH, Austria
US dormant BTP - Companies
Clariant Benelux S.A., Belgium
Clariant (Argentina) S.A., Argentina
Clariant Service (Schweiz) AG
Clariant S.A., Brazil
Clariant Finance (Luxembourg) S.A., Luxembourg
Clariant Colorquímica (Chile) Ltda., Chile
Clariant Produkte (Schweiz) AG
Clariant (Colombia) S.A., Colombia
Clariant Corporation, USA
Clariant (Guatemala) S.A., Guatemala
Clariant Export AG
Clariant (Mexico) S.A. de C.V., Mexico
Clariant (Canada) Inc., Canada
Clariant Productos Quimicos S.A. de C.V., Mexico
Clariant Consulting AG, Switzerland
Clariant (Peru) S.A., Peru
Clariant Verwaltungs GmbH, Germany
Clariant (Uruguay) S.A., Uruguay
(Formerly known as Clariant GmbH)
Clariant (Venezuela) S.A., Venezuela
Clariant Produkte (Deutschland) GmbH
Clariant (Australia) Pty. Ltd., Australia
Clariant Vertrieb (Deutschland) GmbH & Co. KG
Clariant (Tianjin) Ltd., China
Clariant Specialty Fine Chemicals (Deutschland) GmbH
Clariant Chemicals (China) Ltd., China
Clariant Masterbatches (Deutschland) GmbH
Clariant Masterbatches (Guangzhou) Ltd.
Industriepark Griesheim GmbH & Co. KG, Germany
Clariant Pigments (Tianjin) Ltd., China
Technische Services Gersthofen GmbH
Clariant Masterbatches (Beijing) Ltd., China
Clariant (Danmark) A/S, Denmark
Clariant Masterbatches (Shanghai) Ltd., China
Clariant Ibérica Servicios S.L.
Clariant Trading (China) Ltd.
Clariant Ibérica Producción S.A.
Clariant (China) Ltd., Hong Kong
Clariant Ibérica Comercial S.L.
Clariant Chemicals (Guangzhou) Ltd.
Clariant Masterbatch Ibérica S.A., Spain
P.T. Clariant Indonesia, Indonesia
Clariant (Finland) Oy, Finland
Clariant (Japan) K.K., Japan
Clariant Huningue, France
Dia Fine K.K., Japan
K.J. Quinn, France
Notes
Clariant (Korea) Ltd., South Korea
Clariant (France), France
Clariant Masterbatches (Korea) Ltd.
Clariant LSM (France) Holding EURL, France
Clariant Pigments (Korea) Ltd.
Clariant Specialty Fine Chemicals (France) S.A.S.
Clariant (Malaysia) Sdn. Bhd., Malaysia
Clariant Masterbatch Huningue S.A.S.
Clariant Masterbatches (Malaysia) Sdn. Bhd., Malaysia
Clariant Masterbatches (France) S.A.S.
Clariant (New Zealand), Ltd., New Zealand
Clariant Masterbatches (St. Jeoire)
Clariant (Singapore) Pte. Ltd., Singapore
Clariant Holdings UK Ltd., Great Britain
Clariant Chemicals (Thailand) Ltd., Thailand
Clariant UK Ltd., Great Britain
Clariant Masterbatches (Thailand) Ltd., Thailand
UK dormant Clariant - Companies, Great Britain
Clariant Chemicals (Taiwan) Co. Ltd., Taiwan
Clariant Horsforth Ltd., Great Britain
Clariant (Gulf) FZE, United Arab Emirates
BTP Ltd., Great Britain
Egyptian German Company for Dyes & Resins S.A.E., Egypt
BTP Insurance Company Ltd., Great Britain
Clariant (Egypt) S.A.E., Egypt
UK dormant BTP - Companies, Great Britain
Clariant Masterbatches (Saudi Arabia) Ltd.
Clariant Masterbatches UK Ltd.
Clariant (Maroc) S.A., Morocco
Masterplast Ltd., Ireland
Clariant (Pakistan) Ltd., Karachi, Pakistan
Clariant Masterbatches (Italia) SpA.
Clariant Türkiye A.S., Turkey
Clariant Life Science Molecules (Italia) SpA., Italy
Clariant Southern Africa (Pty) Ltd., South Africa
Clariant Servizi (Italia) S.p.A.
BTP World S.A., Luxembourg
Clariant Prodotti (Italia) S.p.A.
Clariant Finanz AG, Switzerland
Clariant Distribuzione (Italia) S.p.A.
Clariant Reinsurance Ltd., Bermuda
Dick Peters B.V., Netherlands
Clariant Insurance (Liechtenstein) AG, Liechtenstein
Clariant (Norge) AS, Norway
Clariant Finance (BVI) Ltd., British Virgin Islands
Clariant Quimicos (Portugal) Lda., Portugal
Clariant Beteiligungen AG
Clariant (Sverige) AB, Sweden
Clariant Chemiebeteiligungen AG
Clariant Masterbatches Norden AB, Sweden
Clariant (Sverige) Holding AB
Associate Companies :
Clariant Consulting (Middle East) Ltd., Switzerland
Clariant Europa EWIV
BCI Betriebs-AG, Switzerland
Clariant Hungaria Kft, Hungary
Clariant Oil Services Ltd., Switzerland
Omnexus N.V., Netherlands
Clariant CR s.r.o., Czech Republic
Clariant (RUS) LLC, Russian Federation
Abieta Chemie GmbH, Gersthofen, Germany
Clariant Distribucija SL, d.o.o., Slovenia
InfraServ GmbH & Co. Gendorf KG, Germany
Clariant (Ecuador) S.A., Ecuador
InfraServ GmbH & Co. Höchst KG, Germany
Concentrados Plasticolor S.A., Guatemala
InfraServ GmbH & Co., Knapsack KG, Germany
Clariant (Honduras) S.A., Honduras
InfraServ GmbH & Co., Ruhrchemie KG, Germany
Clariant Trading (Panama) S.A., Panama
InfraServ GmbH & Co., Wiesbaden KG, Germany
Clariant (El Salvador) S.A. de CV, El Salvador
Industriepark Griesheim Verwaltungs GmbH, Germany
Clariant (Bangladesh) Ltd, Bangladesh
Clariant Beteiligungs-GmbH, Germany
Hangzhou Baihe Clariant Pigments Co., Ltd.
Clariant Vertrieb (Deutschland) Verwaltungs GmbH, Germany
Chemcolour Industries (NZ) Ltd., New Zealand
Clariant Zweite Chemie GmbH, Germany
Clariant (Philippines) Corp., Philippines
ITN Nanovation AG
Clariant (Vietnam) Ltd., Vietnam
EPS Ethylen-Pipeline-Süd GmbH & Co. KG
Clariant Oil Services Angola Lda., Angola
Ethylen-Pipeline-Süd Geschäftsführungs GmbH
Clariant Tunisie S.A., Tunisia
Aguas Industriales de Tarragona S.A., Spain (AITASA)
Compagnie Tunisienne de Chimie Industrielle, Tunisia
S.T.E.I.H. Sàrl, France
Kemoks Kimya Sanayi, Turkey
Clariant (Hellas) S.A., Greece
International School of the Basel Region AG, Switzerland
Clariant Polska Sp. z.o.o, Poland
Starfire Systems Inc., U.S.A.
Colex Sp. z.o.o., Poland
(d)
Key Management Personnel :
H. Meier
:
41
During the period the following transactions were entered into with related parties :
(i)
Holding Company, Subsidiary Companies, Fellow Subsidiaries and Associates :
Holding Company :
Transactions during the period :
Sale of Goods
Clariant International AG
Services rendered and others
EBITO Chemiebeteiligungen AG
Purchase of Goods
Services received and others
Dividend Paid
Balances outstanding as at the end of the period :
Amount Payable
Amount Receivable
Subsidiary Companies :
Chemtreat Composites India Pvt. Ltd.
Advances/Loan given during the year
Chemtreat Composites India Pvt. Ltd.
Amount Receivable
Fellow Subsidiaries :
Sale of Goods
Clariant Corporation
Clariant (China) Ltd.
Clariant UK Ltd.
Others
Clariant Export AG
Others
Purchase of Goods
Clariant UK Ltd.
Clariant Benelux SA
Others
Clariant UK Ltd.
Clariant SA Brazil
Clariant Southern Africa (PTY) Ltd.
Others
Dividend Paid
BTP Ltd., UK
Amount Payable
Amount Receivable
42
April 06 to
December 06
Rs. lakhs
April 05 to
March 06
Rs. lakhs
909.53
501.07
84.67
—
108.44
56.73
5065.25
3889.26
345.01
374.36
898.38
668.25
364.50
490.02
1627.90
153.05
1272.99
175.47
35.57
—
260.00
475.00
770.57
475.00
3147.85
1681.73
1445.32
1387.55
4525.89
2908.30
1956.21
1466.24
686.16
12310.96
79.49
132.48
51.72
206.52
41.89
150.26
7.91
374.93
1758.00
1230.11
1631.65
457.28
28.81
1925.69
—
—
21.22
4.06
14.35
34.62
9.49
3.48
0.23
40.28
292.60
570.00
406.57
2535.85
474.85
2567.91
Notes
During the period the following transactions were entered into with related parties : (Contd.)
(i)
Holding Company, Subsidiary Companies, Fellow Subsidiaries and Associates : (Contd.)
April 06 to
December 06
Rs. lakhs
April 05 to
March 06
Rs. lakhs
Chemcolour Industries (NZ) Ltd.
15.65
11.10
Clariant (Philippines) Ltd.
32.98
—
6.59
13.91
18.02
11.03
3.04
1.77
3.66
—
Associate Companies:
Sale of Goods
Purchase of Goods
Abieta Chemie GmbH
Clariant Consulting (Middle East) Ltd.
Clariant (Philippines) Corp.,
—
17.74
5.27
2.51
111.76
114.53
Remuneration paid to ex-Vice Chairman & Managing Director of
erstwhile Clariant (India) Ltd.
—
125.09
Sale of Assets
—
9.39
15.75
33.09
—
11.88
April 06 to
December 06
April 05 to
March 06
Amount Payable
Amount Receivable
(ii)
Key Management Personnel :
Remuneration paid
Commission Payable (Net)
(iii) Relatives of the Key Management Personnel :
Rent Payment
4.
Earnings per share :
(a) Net profit after taxation for the Period (Rs. lakhs)
(b)
Number of equity shares outstanding
(c)
Number of shares in Share Capital Suspense Account
(d)
Total (b) + (c)
(e)
Basic and Diluted earnings per share (In Rupees)
(f)
5.
Face value per share (In Rupees)
3286.32
4039.18
26660745
11650000
—
15010745
26660745
26660745
12.33
15.15
(Not
annualised)
(Annualised)
10.00
10.00
Deferred Taxes:
The major components of deferred tax assets and deferred tax liabilities are set out below:
April 06 to
December 06
Rs. lakhs
Deferred Tax Assets
(i) Provision for Doubtful debts
(ii)
(iii)
(iv)
(v)
(vi)
Provision for retirement benefits
Expenses allowable for tax purposes when paid
Integration Expenses
Payment/Provision for Voluntary Retirement Scheme
Others
Deferred Tax Liabilities
Deferred Tax Assets/(Liabilities) — Net
April 05 to
March 06
Rs. lakhs
27.25
51.31
331.99
53.07
202.81
508.09
1.21
1124.42
356.93
94.90
247.28
802.09
1.21
1553.72
2106.24
(981.82)
2079.36
(525.64)
43
6. The movements in the provisions are summarised as under :
As on
1st April,
2006
Additional
provision made
during the Period
Amount used/
Reversed
during the Period
As on
31st December,
2006
Rs. lakhs
As on
31st March,
2006
(i)
Provision for Unearned premium
in respect of Sale of Land
650.00
—
650.00
—
650.00
(ii)
Provision for Stamp Duty
pursuant to the Scheme of Amalgamation
741.50
—
741.50
—
741.50
7. On 15th February 2005, the Company had received an order of the Sub-Divisional, Thane demanding Rs. 121 lakhs for the lease of land to Thane
Municipal Corporation, Fire Brigade and Maharashtra State Electricity Board without obtaining prior permission in writing against which the
Company had filed a writ petition on 23rd February 2005 before the Bombay High Court. The Hon’ble High Court has granted interim stay in terms
of the petition on 14th July 2005.
April 06 to
December 06
Rs. lakhs
April 05 to
March 06
Rs. lakhs
360.33
406.53
8. In respect of all assets taken on lease on or after 1st April, 2001 :
(a)
In respect of Operating leases, where lease agreements have been formally entered into, minimum
lease payments recognised in the Profit and Loss Account for the period are as follows:
Residential flats, office premises, vehicles, equipment and machinery, computers etc.
(b)
There are no restrictions such as those concerning dividends, additional debt and further leasing,
imposed by the lease agreements entered into by the Company.
(c)
Contingent rent payments in respect of vehicles are dependent upon the excess of actual usage, if
any, over stipulated usage.
9. Expenditure on Research and Development during the Period
(a)
Capital expenditure
(b)
Revenue expenditure charged to Profit and Loss Account
10. Estimated amount of contracts remaining to be executed on capital account and not provided for
23.90
37.16
358.07
563.87
381.97
601.03
315.60
175.15
1095.55
986.66
14.78
14.78
11. Contingent liabilities not provided for (also see note 7, Schedule 19) :
(a)
In respect of income tax matters decided against the Company, in respect of which the Company is
in further appeal
decided in favour of the Company against which the department is in appeal
(b)
In respect of sales tax matters
297.92
77.82
(c)
In respect of excise matters
819.95
639.53
(d)
In respect of bills of exchange discounted with banks
[since realised Rs. 1401.74 lakhs (Rs. 895.39 lakhs)]
2555.84
1589.06
(e)
Other matters in dispute
6.76
6.76
(f)
Disputed Labour matters - Amount not ascertained
In respect of items (a) to (c), (e) & (f) future cash outflows in respect of contingent liabilities is determinable only on receipt of judgements
pending at various forums/authorities.
12. The names of the small scale industrial undertakings to whom the Company owes, an amount outstanding for more than 30 days are :
Advent Dyestuffs & Chem P. Ltd.
Hema Dyechem Pvt. Ltd.
Niranjan Plastics
Alginates Allied Chem P. Ltd.
Hemali Dye Chem
Nirvip Dyes & Chemicals P. Ltd.
Alpanil Industries
Hercules Pigment Industry
Nivam Instruments Pvt. Ltd.
Alps Chemicals Pvt. Ltd.
Jackson Chemical Industries
Nrox Specialities
Amtex Dye-Chem Industries
Jay Chem
Ohm Polytech Pvt. Ltd.
Amzole India Pvt. Ltd.
K. K. Corporation
Panchsheel Intermediates
Apurva Chemicals
Kanshu Chemical Industries
Panna Chemicals & Solvents P. Ltd
Auxichem
Karsandas Mavji
Premier Solvents Pvt. Ltd.
Britacel Silicones Ltd.
Kiri Dyes & Chemicals Pvt.Ltd.
Prima Chemicals
Chem Coat Chemical Industries
L.N. Chemical Industries
Ranka Organics Pvt. Ltd.
Chromatic India Ltd.
L.V. Associates
S.P. Engineering & Trading Co.
Core Chemicals (Mumbai) Pvt. Ltd.
Link Bulk Drug Products P. Ltd.
Sauradip Chemical Ind. Pvt. Ltd.
44
Notes
D.K.Pharma Chem Pvt. Ltd.
Dhanashree Plastics
Dimple Chemicals & Services
Dispo Dye Chem Pvt. Ltd.
Dragon Drugs Pvt. Ltd.
Esteem Inds.Pvt. Ltd.
Fairdeal Corporation
Fibre Chem Industries
Fineotex Chemical Industries
Flame Pharmaceuticals Pvt. Ltd.
Glowhite Chemicals Pvt. Ltd.
Grand Organics Pvt. Ltd.
Gujarat Clay Mills Pvt. Ltd.
Hema Chemical Industries
Lumis Biotech Pvt. Ltd.
Mahavir Chemicals
Mahesh Engineering Corporation
Makwell Plastisizers Pvt. Ltd.
Manish Minerals & Chemicals
Mass Dye-Chem Pvt. Ltd.
Maulik Dyechem
Mazda Colours Ltd.
Mec Elec Industries
Meghna Packaging
Memba Chem Industries Pvt. Ltd.
Menu Engineering Works
Modhera Chemicals Pvt. Ltd.
Neo Colour
Sealwell India
Shanti Industries
Shrenik Engineers
Sita Chemicals Pvt. Ltd.
Sohan Dye Chem Pvt. Ltd.
Solar Dyes Industries
Speciality Organics Pvt. Ltd.
Sterling Auxiliaries Pvt. Ltd.
Sudarshan Chemicals Ind. Ltd.
Synthetic Dyes And Chemicals
Techno Colour Corporation
Vikram Plasticizers
Yogeshwar Chemicals Ltd.
The above information and that given in Schedule-11 ‘Current Liabilities’ regarding small scale industrial undertakings is restricted to the parties
from whom the Company purchases raw materials, packing materials and finished goods. This has been determined to the extent such parties
have been identified on the basis of information available with the Company. This has been relied upon by the auditors.
13.
Miscellaneous Expenses in Schedule 17: Other Expenditure include :
(a)
(ii)
Audit fees
Company law matters
(iii) Taxation services
(iv) Other services - miscellaneous reports
(v)
14.
April 05 to
March 06
Rs. lakhs
(Excluding
Service Tax)
20.00
35.54
—
3.50
Auditors’ remuneration and expenses :
(i)
(b)
(c)
April 06 to
December 06
Rs. lakhs
(Excluding
Service Tax)
Out-of-pocket expenses
—
5.80
26.00
25.62
1.22
2.02
47.22
72.48
Non Compete Fees of Rs. 154.20 lakhs (Rs. NIL) paid to ex-Managing Director.
Legal and Professional charges of Rs. 769.70 lakhs (Rs. 243.90 lakhs) towards consultancy.
Disclosure in respect of Derivative Instruments :
The Company uses Forward Exchange Contracts to hedge its exposure in foreign currency. The information on derivative instruments is as
follows:
(a) Forward Exchange Contracts outstanding as at
Currency
31-12-2006
Amount in
foreign
Amount
currency
Rs. lakhs
31-03-2006
Amount in
foreign
Amount
currency
Rs. lakhs
EUR / INR
—
—
237210
127.00
CHF / INR
—
—
200000
68.77
195.77
(b)
Foreign currency exposures not covered by a derivative instrument
(i) Amount receivable on account of export of goods and services
Currency
31-12-2006
Amount in
foreign
Amount
currency
Rs. lakhs
31-03-2006
Amount in
foreign
Amount
currency
Rs. lakhs
USD
8199019
3675.23
5338925
2367.67
EUR
213507
125.60
193315
102.13
CHF
2583
0.94
133554
46.09
GBP
1512
1.67
65611
51.48
JPY
—
—
785000
3.00
3803.44
2570.37
45
(ii)
Amount payable on account of import of goods and services
Currency
USD
EUR
CHF
GBP
31-12-2006
Amount in
foreign
Amount
currency
Rs. lakhs
2137474
2929480
343438
38602
946.48
1708.23
124.74
33.54
2812.99
31-03-2006
Amount in
foreign
Amount
currency
Rs. lakhs
2800781
1136690
865611
64406
1252.26
622.89
299.92
50.35
2225.42
15.
In terms of the share purchase agreement for Chemtreat Composites India Private Limited (fully owned subsidiary) dated 13th February, 2006 read
with supplemental agreement of even date and letter of Indemnity and Guarantee dated 26th December, 2006, the Company has paid
Rs. 60 lakhs (Rs. NIL) during the current period towards full and final settlement and has been included in cost of investment in subsidiary.
16
(a)
Amount paid/payable by the Company to Directors (including Managing Director) as remuneration for services rendered in any capacity :
(b)
April 06 to
April 05 to
March 06
December 06
Rs. lakhs
Rs. lakhs
1.22
Directors’ sitting fees
1.68
95.85
Salaries
38.72
23.75
Commission
42.31
0.16
Other perquisites and benefits in cash or in kind
39.50
120.98
122.21
Note: (i) Provision for leave encashment and gratuity benefit which is based on actuarial valuation done on an overall Company basis
is excluded from above.
(ii) Excludes non compete fees of Rs.154.20 lakhs paid to ex-Managing Director
In respect of the period April 05 to March 06:
• In the absence of records, the quantum of excess remuneration paid, if any, as compared to the 1969 Managerial
Remuneration Guidelines in respect of a sum of Rs. 3.33 lakhs paid to an ex-managing director of erstwhile Clariant (India)
Limited for the years 1981 and 1982, has not been ascertained.
• Excludes remuneration of Rs.125.09 lakhs paid to ex-managing director and Rs.6.50 lakhs payable to non wholetime
directors of erstwhile Clariant (India) Limited.
• Excludes sitting fees of Rs.1.64 lakhs & Rs.1.62 lakhs paid to the non wholetime directors of erstwhile Clariant (India) Limited
and erstwhile Vanavil Dyes and Chemicals Limited respectively.
• Excludes Rs. 62.20 lakhs paid to ex-managing director of erstwhile Clariant (India) Limited as consultant of the Company for
a period from 20th March, 2006 to 31st March, 2006.
Computation of net profit for commission payable to the Directors in accordance with Section 198 of the Companies Act, 1956 :
April 06 to
December 06
Rs. lakhs
Rs. lakhs
Profit after tax as per Profit and Loss Account
Add: Provision for Taxation-Net
Managerial Remuneration
Wealth Tax
Amortisation of Voluntary Retirement Scheme Compensation
Integration expenses
Flood Loss
Adjustment on Sale of Land at Thane
April 05 to
March 06
Rs. lakhs
Rs. lakhs
3286.32
1791.18
120.98
7.20
10.43
—
—
—
4039.18
2444.47
122.21
6.75
—
925.85
130.84
117.74
1929.79
5216.11
Less: Profit on sale of Investments
Provision for Unearned premium written back
Provision for diminution in the value of investments written back
Capital receipts-Surrender of Tenancy right
Reversal of Depreciation on change of Method
Capital Profit on Sale of Fixed Assets
Net profit as per Section 198
46
43.05
71.58
50.00
—
—
399.70
3747.86
7787.04
54.69
139.27
—
0.53
30.00
—
41.86
107.35
606.19
4609.92
331.84
7455.20
Notes
April 06 to
December 06
Rs. lakhs
Rs. lakhs
Commission:
To Vice-Chairman & Managing Director
1.
Fixed Commission
2.
Variable Commission
15.75
—
April 05 to
March 06
Rs. lakhs
Rs. lakhs
29.04
7.27
15.75
36.31
restricted to sum as determined by the Board of Directors.
To Directors who are not in whole-time employment of the
Company @ 1% of net profit i.e. Rs. 46.10 lakhs (Rs. 74.55 lakhs)
restricted to sum as determined by the Board of Directors.
8.00
23.75
6.00
42.31
17.
Advances and loans to a subsidiary include due from Chemtreat Composites India Private Ltd Rs. 770.57 lakhs (Rs. 475.00 lakhs). Maximum amount
due during the Period Rs. 770.57 lakhs (Rs. 475.00 lakhs). This amount is interest free and repayable on demand.
18.
Class of goods
Production*
Annual
Installed
capacity
M. Tonnes
10040**
4373**#
9870**
1590**
1665**
Unit
(a)
Pigment dyestuffs and their dispersions
Annual
Installed
capacity
Production*
7708**#
(b)
Synthetic organic dyestuffs
M. Tonnes
(c)
Synthetic resins, binder materials
auxiliaries and Chemicals
M. Tonnes
52450
36823
39410
1337**
38035
1671 **
(d)
Intermediates (including catalysts) for
dyes, pesticides, pharmaceuticals, etc.
M. Tonnes
17770
3832
19530
8366
(e)
*
**
#
Master batches
M. Tonnes
Excluding captive consumption
At different concentrations
Includes third party production of 47 tonnes (2061 tonnes)
1060
667
1060
536
Notes:
1
The classification between the class of goods and the installed capacities have been certified by the Vice-Chairman & Managing Director
on which the auditors have placed reliance, this being a technical matter.
2
Licensed capacity per annum not indicated due to the abolition of Industrial Licenses as per Notification No. 477(E) dated 25th July,1991
issued under The Industries (Development and Regulations) Act, 1951.
19. Class of goods
Unit
(a)
Pigment dyestuffs and their
dispersions
M. Tonnes
(b)
Synthetic organic dyestuffs
M. Tonnes
Stock transferred
on amalgamation*
Value
Qty. Rs. lakhs
Value
Qty. Rs. lakhs
Value
Qty. Rs. lakhs
663
2276.11
(568) (1794.68)
—
(141)
690
(663)
—
(319.42)
Closing
Stock
2479.72
(2276.11)
Sales (inclusive of
excise duty)
Qty.
Value
Rs. lakhs
4299
(5693)
15143.60
(18919.66)
188
482.62
—
—
184
390.01
1669
4286.51
(—)
(—)
(155)
(391.89)
(188)
(482.62)
(1638)
(5046.44)
1994
(995)
1197.18
(600.79)
—
(1366)
—
(851.84)
2188
(1994)
1433.21
(1197.18)
36629
(38191)
28119.60
(28056.44)
184
(65)
539.93
(175.33)
—
(1)
—
(3.02)
170
(184)
460.37
(539.93)
3846
(8248)
7305.64
(12111.66)
—
(46)
—
(84.07)
16
(19)
30.94
(33.84)
670
(556)
1761.78
(1530.90)
(c)
Synthetic resins, binder materials
auxiliaries and Chemicals
(d)
Intermediates (including catalysts) for M. Tonnes
dyes, pesticides, pharmaceuticals, etc.
(e)
Master batches
M. Tonnes
19
(—)
33.84
(—)
(f)
Trading items (including dyes,
chemicals, pigments,
masterbatches, etc.)
M. Tonnes
1460
2232.78
—
—
1176
2057.58
13350
18772.22
(319)
(603.16)
6762.46
(3173.96)
(907)
(1357.82)
—
(3008.06)
(1460)
(2232.78)
6851.83
(6762.46)
(18822)
(26800.23)
75389.35
(92465.33)
Note: 1
2
M. Tonnes
Opening
Stock
Previous year figures have been regrouped/reclassified wherever necessary to conform to the current period’s classification.
* See note 1(a), Schedule 19
47
20
20.
Class of Goods
Purchase of finished goods
Quantity
Value
M. Tonnes
Rs. lakhs
Trading Items:
Dye, Chemicals, pigments, masterbatches, etc.
11906
13600.13
Quantity*
Value
M. Tonnes
Rs. lakhs*
18838
21545.91
* Net of goods destroyed in flood.
21.
Raw Materials consumed:
Quantity
Value
M. Tonnes
Rs. lakhs
(a)
Acetic Acid Glacial
(b)
Others (None of the items individually exceed 10%
of the total value of raw materials consumed)
7627
2443.69
Quantity
Value
M. Tonnes
Rs. lakhs
9359
3234.91
27429.73
29901.06
29873.42
33135.97
Note: Raw materials consumed have been arrived at after write down of certain items and excesses and shortages on physical verification.
22. Consumption of raw materials, components and spare parts:
Percentage
of total
Consumption
Rs. lakhs
(i)
Raw materials:
Imported
Indigenous
(ii)
Percentage
of total
Consumption
Rs. lakhs
28.31
8455.79
71.69
100.00
30.38
10065.40
21417.63
69.62
23070.57
29873.42
100.00
33135.97
Components and spare parts referred to in Paragraph 4D (c) of Schedule VI of the Companies Act, 1956 are assumed to be those
incorporated in the goods produced and not those used for maintenance of plant and machinery.
23. Value of imports (C.I.F.) :
(i)
Raw materials and trading items
(ii)
Components and spare parts
(iii) Capital goods
April 06 to
December 06
Rs. lakhs
April 05 to
March 06
Rs. lakhs
12564.25
14472.15
32.80
19.66
267.20
138.57
April 06 to
December 06
Rs. lakhs
April 05 to
March 06
Rs. lakhs
24. Expenditure in foreign currency (subject to deduction of tax where applicable):
(i)
(ii)
Interest
(iii) Others (includes exchange loss)
74.72
70.19
138.26
162.14
721.98
972.24
April 06 to
December 06
April 05 to
March 06
25. Remittance in foreign currency on account of dividend:
Number of non-resident shareholders where direct remittances have been made by the Company
Number of shares on which dividend is remitted
(Previous Year : includes 60,75,000 shares of erstwhile Clariant (India) Limited held by one shareholder;
3,80,00,000 shares of erstwhile BTP India Private Limited held by one shareholder)
Year to which dividend relates
Amount remitted (Rs. lakhs)
48
3
3
16902080
52242080
2005-2006
1859.23
2004-2005
1424.52
Notes
26.
Earnings in foreign exchange :
(i)
Exports (F.O.B.)
(ii)
Know-how
(iii) Others (insurance, freight, commission, claims, exchange gain etc.)
April 06 to
December 06
Rs. lakhs
April 05 to
March 06
Rs. lakhs
15908.67
22766.29
164.76
147.82
1124.69
1350.83
27. (a)
Miscellaneous Income includes Rs. 220 lakhs (Rs. NIL) towards Remnant Cost received from Dystar India Ltd. on termination of Toll
Manufacturing agreement w.e.f. 1st April, 2006.
(b)
In respect of previous year Contribution to Provident fund, Superannuation scheme, Gratuity fund, etc. under ‘Personnel cost’
(Schedule-15) includes contribution of Rs. 330 lakhs on account of the higher actuarial liability of gratuity as on 31st July, 2005
determined by the Company’s actuary appointed during the year as against the acturial liability of gratuity determined by the Company’s
previous actuary as on 31st March, 2005.
(c)
Other Expenditure (Schedule-17) includes Integration expenses as follows, incurred by the Company on amalgamation of erstwhile
Clariant (India) Limited, Vanavil Dyes and Chemicals Limited, BTP India Private Limited and Kundalika Investments Limited with the
Company, pursuant to the Scheme of Amalgamation.
April 06 to
December 06
Rs. lakhs
April 05 to
March 06
Rs. lakhs
Legal and Professional Fees
—
63.35
Rates and taxes
—
754.10
Others
—
108.40
—
925.85
28. Hitherto depreciation in respect of buildings, furniture, fixtures and office appliances and vehicles existing as on 31st March, 1995 has been
calculated on written down value method at the rates and in the manner specified in Schedule XIV of the Companies Act, 1956 except for
certain items of furniture, fixtures and vehicles on which a depreciation rate of 20% on straight line method is applied. During the period, the
Company has changed the method of calculating depreciation from written down value method to straight line method which has resulted in
reversal of depreciation of Rs. 399.70 lakhs (Rs. NIL). As a result of the change in the method of depreciation, the depreciation charge for the
period is lower and profit before tax for the period is higher, each by Rs. 399.70 lakhs (Rs. NIL).
29.
From 1st April, 2006, the Company has changed the rate of depreciation as follows:
Depreciation Rate
Plant and Machinery (Continous Process Plant)
Vehicles
From
1st April 2006
Upto
31st March 2006
6.67%
5.28%
20.00%
9.50%
As a result of the change in the rate of depreciation, the depreciation charge for the period is higher and the profit before tax is lower, each by
Rs. 333.43 lakhs (Rs. NIL)
30.
During the period the Company has changed it’s policy in respect of accounting for voluntary retirement expenses by amortising the expenses over
a period of three years as against the earlier policy of charging it in the year when incurred. As a result ‘Personnel Cost’ for the period is lower and
profit before tax for the period is higher, each by Rs. 177.25 lakhs (Rs. NIL).
31. Figures for the previous year have been regrouped wherever necessary to conform to the current period’s classification.
32. The figures in brackets are those in respect of the previous accounting year.
49
33. Statement Pursuant to Part IV of Schedule VI to the Companies Act, 1956
Balance Sheet Abstract and Company’s General Business Profile
I.
Registration Details
Registration No.
1
1
-
1
0
8
0
6
State Code
1
1
Balance Sheet Date
II.
3 1
1 2
2 0 0 6
Date
Month
Year
Capital raised during the year (Amount in Rs. Thousands)
Public Issue
N I L
Rights Issue
N I L
Bonus Issue
N I L
III.
Private Placement
N I L
Position of Mobilisation and Deployment of Funds (Amount in Rs. Thousands)
Total Liabilities*
5 8 6 3 6 6 1
Total Assets
8 6 3 6
6
1
7
Reserves and Surplus
2 8 3 5 8 2
4
4
4
Unsecured Loans
4 7 8 9
6
Application of Funds
Net Fixed Assets
1 6 5 1 8 5
2
Net Current Assets**
1 0 2 9 9 3
6
Sources of Funds
Paid-up Capital
2 6 6 6
0
Secured Loans
1 4 2
Investments
4 6 5 0
5
5
8
Miscellaneous Expenditure
1 7 7 2 5
Accumulated Losses
N I L
*including Shareholder’s funds
**includes deferred tax liabilities (Net) Rs. 98182
IV.
Performance of Company (Amount in Rs. Thousands)
Turnover (Gross Revenue)@
7 1 1 3 6 2 2
Total Expenditure
6 6 0 5 8 7
@ includes Miscellaneous income Rs. 243175
+ Profit Before Tax
√
5 0 7 7 5 0
+
√
-
Profit After Tax
3 2 8 6
Earnings per Share in Rs.**
(Not annualised)
1 2 . 3 3
3
2
2
Dividend Rate %
1 8 0
** Earning per share have been computed by dividing profit after tax by the total number of issued equity shares as at the year end.
V.
Generic Names of Three Principal Products of Company.
Item Code No.
3
2
0
4
1
Product Description
H O S
T A P
E R M
Item Code No.
2
9
2
4
.
1
9
Product Description
A C
E
T O A C
E
T
Item Code No.
2
9
1
5
.
0
0
Product Description
A C
E
T O A C
E
T
1
9
7
0
0
.
5
1
G R
E
E N
M O N O M E
I
C
M E
G N X
T H Y
T H Y
L
L A M I
E S
T
D E
7
0 %
E R
R. A. Shah
Chairman
H. Meier
B. S. Mehta
Diwan A. Nanda
K. J. Bharucha
Sunil K. Nayak
}
Directors
50
Notes
Statement Pursuant to Section 212 of the Companies Act, 1956
Name of the Subsidiary Company
Chemtreat Composites
India Private Ltd.
1.
Financial year of the Subsidiary Company
April, 2006 to December, 2006
2.
Total issued and paid-up share capital of the
Subsidiary Company :
(a)
Issued
(b)
Subscribed and Paid-up
3.
Extent of Interest of Clariant Chemicals (India) Ltd.
4.
Net aggregate amount of profits :
5,00,000 equity shares of Rs. 10/- each
5,00,000 equity shares of Rs. 10/- each
5,00,000 at the end of the financial period equity shares of Rs. 10/- each
(a)
Post-tax profit/(loss) for the year
Rs. 281.89 lakhs
(b)
Profit/(Loss) carried to its Balance Sheet
Rs. 276.79 lakhs
No adjustment has been made in the accounts of the Company in respect of the profit/(loss) earning by the Subsidiary Company.
R. A. Shah
Chairman
H. Meier
B. S. Mehta
Diwan A. Nanda
K. J. Bharucha
Sunil K. Nayak
}
Directors
Auditors’ Report to the Members
AUDITORS’ REPORT TO THE BOARD OF DIRECTORS OF
CLARIANT CHEMICALS (INDIA) LIMITED ON THE
CONSOLIDATED FINANCIAL STATEMENTS OF CLARIANT
CHEMICALS (INDIA) LIMITED
1.
2.
3.
We have audited the attached Consolidated Balance Sheet of
Clariant Chemicals (India) Limited and its subsidiary (the
Clariant Chemicals (India) Group ), as at December 31, 2006
and also the Consolidated Profit and Loss Account and the
Consolidated Cash Flow Statement for the nine months period
ended on that date annexed thereto. These financial
statements are the responsibility of Clariant Chemicals (India)
Limited’s management. Our responsibility is to express an
opinion on these financial statements based on our audit.
We conducted our audit in accordance with the auditing
standards generally accepted in India. Those Standards
require that we plan and perform the audit to obtain
reasonable assurance about whether the financial
statements are free of material misstatement. An audit
includes examining on a test basis, evidence supporting the
amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and
significant estimates made by management, as well as
evaluating the overall financial statement presentation. We
believe that our audit provides a reasonable basis for our
opinion.
We report that the consolidated financial statements have
been prepared by the Clariant Chemicals (India) Limited’s
management in accordance with the requirements of
Accounting Standard (AS) 21, Consolidated Financial
Statements, issued by the Institute of Chartered Accountants
of India.
4.
In our opinion and to the best of our information and
according to the explanations given to us, the attached
Consolidated Financial Statements give a true and fair view in
conformity with the accounting principles generally accepted
in India:
(i) in the case of the Consolidated Balance Sheet, of the
state of affairs of the Clariant Chemicals (India) Group as
at December 31, 2006;
(ii) in the case of the Consolidated Profit and Loss Account,
of the profit of the Clariant Chemicals (India) Group for
the nine months period ended on that date; and
(iii) in the case of the Consolidated Cash Flow Statement, of
the cash flows of the Clariant Chemicals (India) Group
for the nine months period ended on that date.
A. C. Khanna
Partner
51
Consolidated Balance Sheet
as at 31st December, 2006
Schedule
31-12-2006
Rs. lakhs
31-03-2006
Rs. lakhs
1165.00
SOURCES OF FUNDS
Shareholders’ funds
Share capital
Share capital suspense account
Reserves and surplus
1
2666.07
1A
—
1501.07
2
28636.02
30539.79
31302.09
33205.86
Loan funds
Secured loans
3
142.44
3597.85
Unsecured loans
4
478.96
1995.82
621.40
5593.67
Deferred Tax Liability - Net (See note 5, Schedule 19)
1024.82
525.85
32948.31
39325.38
Gross block
38444.92
38153.45
Less: Accumulated depreciation
21811.24
22486.37
Net block
16633.68
15667.08
812.80
1041.85
17446.48
16708.93
6
4325.58
11061.19
Inventories
7
12934.60
12528.37
Sundry debtors
8
14223.07
14514.50
Cash and bank balances
9
3965.10
1441.87
10
6036.21
6982.10
37158.98
35466.84
APPLICATION OF FUNDS
Fixed Assets
5
Capital work-in-progress and advances, etc.
Investments
Current assets, loans and advances
Loans and advances
Less:
Current liabilities and provisions
Liabilities
11
18763.41
17181.80
Provisions
12
7396.57
6729.78
26159.98
23911.58
10999.00
11555.26
177.25
—
32948.31
39325.38
Net current assets
Miscellaneous Expenditure-Voluntary Retirement Scheme
(To the extent not written off or adjusted) {See note 5, Schedule 18}
18
19
Per our report attached
R. A. Shah
Chairman
H. Meier
B. S. Mehta
A. C. Khanna
Partner
Diwan A. Nanda
K. J. Bharucha
Sunil K. Nayak
52
}
Directors
Consolidated Profit and Loss Account
for the nine months period ended 31st December, 2006
Schedule
April 06 to
December 06
Rs. lakhs
April 05 to
March 06
Rs. lakhs
75898.50
92465.33
INCOME
Sales – Gross
Less: Excise Duty Recovered on Sales
Sales – Net
Add: Processing charges
Turnover
Other income
13
6684.88
7673.87
69213.62
84791.46
—
804.69
69213.62
85596.15
2424.24
2812.72
71637.86
88408.87
EXPENDITURE
Cost of Materials
14
45569.29
55611.62
Personnel Cost
15
5479.65
7032.73
Interest (Net)
16
(6.75)
4.15
5
1545.70
2447.42
17
14117.90
17373.11
66705.79
82469.03
Other expenditure
Less: Service charges recovered
470.36
538.91
66235.43
81930.12
5402.43
6478.75
1250.00
2238.25
Provision for taxation
Current Tax
Deferred Tax
Fringe Benefit Tax
PROFIT AFTER CURRENT PERIOD’S TAXATION
498.97
36.77
85.25
227.99
3568.21
3975.74
—
(59.33)
3568.21
4035.07
Balance brought forward from last year
3862.38
2981.16
Add: Transfer in terms of amalgamation (See note 1(a), Schedule 19)
—
1308.30
Less: Deductions/Adjustments on amalgamation of subsidiaries
—
(118.16)
7430.59
8206.37
330.00
4798.93
673.05
1628.61
7430.59
1000.00
2932.68
411.31
3862.38
8206.37
13.38
(Not annualised)
15.13
(Annualised)
10.00
10.00
(Excess)/Short provision for taxation in respect of earlier years
Available for appropriation
APPROPRIATED AS FOLLOWS
General reserve
Proposed dividend
Corporate tax on proposed dividend
Balance carried to the Balance Sheet
18
19
Basic and Diluted earnings per share (in Rupees) (See note 4, Schedule 19)
19
Face value per share (in Rupees)
R. A. Shah
Chairman
H. Meier
B. S. Mehta
A. C. Khanna
Partner
Diwan A. Nanda
K. J. Bharucha
Sunil K. Nayak
}
Directors
53
Consolidated Cash Flow Statement for the nine months period
ended 31st December, 2006
A.
April 06 to
December 06
Rs. lakhs
April 05 to
March 06
Rs. lakhs
5402.43
6478.75
1545.70
2447.42
13.42
25.78
Interest income
(211.92)
(480.97)
Dividend income
(61.44)
(297.82)
Loss/(profit) on sale of assets (Net)
(32.62)
(56.98)
CASH FLOW FROM OPERATING ACTIVITIES :
Net Profit before tax and Extra ordinary items
Adjustments for :
Depreciation
Unrealised foreign exchange (gain)/loss (Net)
Loss/(profit) on sale of Investments (Net)
Provision for Diminution in value of investment written back
—
117.74
(43.05)
(54.69)
10.43
—
—
(0.53)
Provision for Doubtful debts written back (Net)
(71.58)
(139.27)
Provision for Leave encashment
(92.21)
127.15
2.88
15.55
—
741.50
0.80
40.27
205.17
485.12
—
0.14
121.93
151.65
6789.94
9600.81
Trade and other receivables
1617.78
542.70
Payment of Voluntary Retirement Scheme compensation
(187.68)
—
Inventories
(406.23)
(1744.10)
Trade, other payables and Provisions
167.61
531.11
7981.42
8930.52
(1521.89)
(2697.85)
6459.53
6232.67
(2418.80)
(3555.94)
136.48
190.97
(13623.56)
(42141.12)
(60.00)
(281.48)
20402.22
40963.94
Interest received
70.13
659.18
Dividend received
61.44
297.82
4567.91
(3866.63)
Provision for Ex-Gratia Gratuity
Provision for Stamp Duty in connection with Integration
Provision for Gratuity
Interest expenses
Investment written-off
Assets written-off
Operating profit before working capital changes
Adjustments for :
Cash generated from operations
Direct taxes paid - (Net of refunds)
Net cash from operating activities
B.
CASH FLOW FROM INVESTING ACTIVITIES :
Purchase of fixed assets
Sale of fixed assets
Purchase of investments
Investment in subsidiaries
Sale of investment
Net cash used in investing activities
54
Consolidated Cash Flow Statement
April 06 to
December 06
Rs. lakhs
C.
April 05 to
March 06
Rs. lakhs
CASH FLOW FROM FINANCING ACTIVITIES :
(3330.41)
Cash credit and Packing credit (Net)
571.02
Reduction of Share Capital of erstwhile BTP India Private Limited
—
(2470.00)
Proceeds from borrowings
—
12381.23
(1641.86)
(12826.64)
(207.75)
(501.96)
Dividend/dividend tax paid
(3324.19)
(2316.67)
Net cash used in financing activities
(8504.21)
(5163.02)
NET INCREASE IN CASH AND CASH EQUIVALENTS (A+B+C)
2523.23
(2796.98)
CASH AND CASH EQUIVALENTS AS AT BEGINNING OF THE YEAR
1441.87
497.89
CASH AND CASH EQUIVALENTS-TAKEN OVER ON AMALGAMATION
—
3739.45
ADDITIONS ON TAKE OVER OF CHEMTREAT COMPOSITES INDIA PRIVATE LIMITED
—
1.51
3965.10
1441.87
Repayment of borrowings
Interest paid
CASH AND CASH EQUIVALENTS AS AT THE END OF THE YEAR
Notes:
1.
The Cash Flow Statement has been prepared under the “Indirect Method” as set out in Accounting Standard-3 on Cash Flow statements issued
by the Institute of Chartered Accountants of India.
2.
Direct taxes paid are treated as arising from operating activities and are not bifurcated between investing and financing activities.
3.
The figures of current reporting period of nine months ended December 31, 2006 are not directly comparable with the figures relating to previous
reporting period of twelve months ended March 31, 2006.
4.
Figures for the previous year have been regrouped wherever necessary to conform to this period’s classification.
R. A. Shah
Chairman
H. Meier
B. S. Mehta
A. C. Khanna
Partner
Diwan A. Nanda
K. J. Bharucha
Sunil K. Nayak
}
Directors
55
Schedules forming part of the Consolidated Balance Sheet
SCHEDULE 1 : SHARE CAPITAL
31-12-2006
Rs. lakhs
31-03-2006
Rs. lakhs
3000.00
3000.00
2666.07
1165.00
31-12-2006
Rs. lakhs
31-03-2006
Rs. lakhs
—
1501.07
31-12-2006
Rs. lakhs
31-03-2006
Rs. lakhs
Authorised
30000000 equity shares of Rs. 10/- each
Issued and subscribed
26660745 (Previous year : 11650000 ) equity shares of Rs. 10/- each fully paid
Notes :
Of the above:
(a) 15010745 equity shares issued as fully paid up pursuant to a contract for a
consideration other than cash.
(b) 8167080 equity shares are held by EBITO Chemiebeteiligungen AG.
6075000 (Previous year : NIL) equity shares are held by Clariant International AG.
2660000 (Previous year : NIL) equity shares are held by Clariant Participations AG.
(c) 6690610 equity shares were allotted as fully paid up bonus shares by capitalisation
of Rs. 669.06 lakhs from general reserve.
SCHEDULE 1A : SHARE CAPITAL SUSPENSE ACCOUNT
Share capital suspense
Note:
In terms of the scheme of amalgamation in the previous year between Clariant (India) Limited,
Vanavil Dyes and Chemicals Limited, Kundalika Investments Limited, BTP India Private Limited,
the transferor companies and the Company, 15010745 equity shares of Rs 10/- each fully paid,
were issued during the period to the shareholders of the transferor companies whose names
appeared on their register of members on the record date viz 21st April, 2006
Of the above:
(i) 6075000 equity shares were issued to Clariant International AG.
(ii) 2660000 equity shares were issued to BTP Limited, UK.
SCHEDULE 2 : RESERVES AND SURPLUS
Capital reserve
730.11
3.86
—
27.16
Add: Excess of share capital of transferor companies over
the amount credited by the company to the share capital *
—
702.85
Less: Deductions/Adjustments on amalgamation of subsidiaries *
—
(3.76)
730.11
730.11
137.50
137.50
3545.65
2023.50
—
1522.15
3545.65
3545.65
Add: Transfer in terms of amalgamation *
Capital redemption reserve
Securities premium account
Investment allowance reserve
56
20.00
7.19
—
20.00
—
(7.19)
20.00
20.00
SCHEDULE 2 : RESERVES AND SURPLUS (Contd.)
31-12-2006
Rs. lakhs
31-03-2006
Rs. lakhs
22244.15
11905.16
330.00
1000.00
—
10210.81
General reserve
Add: Transfer from Profit and Loss Account
Add: Transfer in terms of amalgamation (Net of adjustments) *
—
(871.82)
22574.15
22244.15
Reserve for Environmental upgradation
—
53.50
—
(53.50)
—
—
1628.61
3862.38
28636.02
30539.79
31-12-2006
Rs. lakhs
31-03-2006
Rs. lakhs
142.44
3472.85
—
125.00
142.44
3597.85
31-12-2006
Rs. lakhs
31-03-2006
Rs. lakhs
—
1000.00
—
475.00
478.96
520.82
478.96
1995.82
SCHEDULE 3 : SECURED LOANS
From banks :
Short Term Loans :
Rs. 142.44 lakhs (Previous year : Rs. 3432.00 lakhs) secured by hypothecation of present and future
stock-in-trade and spare parts, loose tools, book debts, outstanding monies, receivables, claims, bills,
right to or in movable properties and movable assets, etc.
Rs. NIL (Previous year : Rs. 40.85 lakhs) secured by way of first charge on inventories and book debts,
both present and future and by second charge on other movable and immovable properties,
both present and future.
Term L oan:
(Repayable within one year Rs. NIL; Previous year : Rs. 100 lakhs)
(Secured by first charge on plant and machinery)
SCHEDULE 4 : UNSECURED LOANS
Privately placed Non-convertible debentures :
9% Non-convertible debentures redeemable at par
(Redeemed on 12th April, 2006)
Other Loans :
From banks :
Short Term Loan
From others :
Interest-free sales tax deferral scheme granted by
State Industries Promotion Corporation of Tamil Nadu Limited
57
58
379.17
Software license fees
427.59
917.31
2447.42
1545.70
189.76
114.56
1519.98
(278.72)
0.12
—
—
—
22486.37
21811.24
519.72
866.29
18029.22
2012.66
4.18
—
379.17
—
16633.68
397.59
709.36
10845.29
4361.63
10.69
82.68
—
226.44
15667.08
619.11
773.18
10324.60
3690.26
10.81
82.68
—
166.44
Notes :
1 . Buildings include :
Rs. 0.12 lakh (Previous year : Rs. 0.12 lakh) being the cost of shares and bonds in co-operative housing societies.
Rs. 600 (Previous year : Rs. 1200) being the cost of shares yet to be allotted.
2 . * Transfer after adjustments as on April 1, 2005 pursuant to the scheme of amalgamation. (See note 1 (a), Schedule 19)
3. See note 16 and 17, Schedule 19
1041.85
861.13
2220.83
97.63
194.73
1922.69
5.78
—
—
—
—
As at
31-03-06
16708.93
5262.24
—
—
—
—
—
—
—
—
—
As at
31-12-06
NET BLOCK
812.80
5.45
—
—
—
—
—
—
—
—
—
As at
31-12-06
17446.48
15632.39
DEPRECIATION/AMORTISATION
Additions on
Transfer Sales and
For the
acquisition in terms of deductions
period
of Chemtreat amalgama(See note 3
tion*
below)
58.31
38153.45
22486.37
946.46
1575.65
38444.92
2297.16
18431.93
6374.29
28874.51
—
4.06
14.87
379.17
379.17
82.68
—
As at
31-03-06
226.44
As at
31-12-06
983.54
1146.77
2446.62
145.36
244.96
2008.96
47.34
—
—
—
—
Sales and
deductions
158.99
3121.31
2738.09
15.97
100.97
2126.94
434.21
—
—
—
60.00
Additions
653.81
10321.75
—
—
—
—
—
—
—
—
—
Transfer
in terms of
amalgamation*
GROSS BLOCK
Advances against capital orders
13.41
—
—
—
—
—
—
—
—
—
Additions
on acquisition
of Chemtreat
Rs. lakhs
Capital work-in-progress
38153.45
25843.75
1046.70
Vehicles
Previous year
1719.64
Furniture, fixtures and office appliances
Total
28756.53
Plant, machinery, equipment etc.
5987.42
14.87
Land leasehold
Buildings
82.68
Land freehold
Tangible Assets
166.44
As at
31-03-06
Goodwill on consolidation
Intangible Assets
FIXED ASSETS
Schedule 5
SCHEDULE 6 : INVESTMENTS (AT COST)
31-12-2006
Rs. lakhs
31-03-2006
Rs. lakhs
3825.00
4325.00
Long term
Non-Trade-unquoted
Current
Non-Trade-unquoted
Aggregate value of unquoted investments
500.58
6736.19
4325.58
11061.19
4325.58
11061.19
31-12-2006
Rs. lakhs
31-03-2006
Rs. lakhs
SCHEDULE 7 : INVENTORIES
At lower of cost and net realisable value
(As certified by the Management)
400.96
324.91
4201.99
3586.00
131.99
102.45
Finished goods
6891.48
6762.46
Work-in-progress
1308.18
1752.55
12934.60
12528.37
31-12-2006
Rs. lakhs
31-03-2006
Rs. lakhs
Under six months
947.83
1072.84
Over six months
83.08
17.67
1030.91
1090.51
12911.54
13311.26
361.50
265.19
13273.04
13576.45
14303.95
14666.96
80.88
152.46
14223.07
14514.50
Stores and spare parts
Raw materials
Packing materials
SCHEDULE 8 : SUNDRY DEBTORS
Secured
(Considered good)
Unsecured
Under six months (Considered good)
Over six months (Including doubtful debts Rs. 80.88 lakhs;
Previous year : Rs. 152.46 lakhs; balance considered good)
Less: Provision for doubtful debts
59
SCHEDULE 9 : CASH AND BANK BALANCES
Cash on hand
Cheques on hand
With scheduled banks :
On current accounts
On margin accounts
On fixed deposit accounts
31-12-2006
Rs. lakhs
31-03-2006
Rs. lakhs
14.18
2777.35
10.02
168.62
1172.82
—
0.75
1173.57
3965.10
783.26
22.07
457.90
1263.23
1441.87
31-12-2006
Rs. lakhs
31-03-2006
Rs. lakhs
3323.65
4801.35
SCHEDULE 10 : LOANS AND ADVANCES
(Unsecured – considered good, unless otherwise stated)
Advances recoverable in cash or in kind or for value to be received
VAT set off admissible
Advance payment of Income tax (Net of Provision for taxation)
Balances with Customs and Excise on current account
188.29
106.71
1727.93
1472.42
796.34
601.62
6036.21
6982.10
31-12-2006
Rs. lakhs
—
17339.07
31-03-2006
Rs. lakhs
178.81
15607.06
1296.89
0.18
122.63
1.28
3.36
18763.41
1282.21
2.76
102.83
1.49
6.64
17181.80
31-12-2006
Rs. lakhs
31-03-2006
Rs. lakhs
652.82
279.88
90.03
745.03
329.12
87.15
901.86
—
—
4798.93
673.05
7396.57
832.99
650.00
741.50
2932.68
411.31
6729.78
SCHEDULE 11 : CURRENT LIABILITIES
Acceptances
Sundry creditors
(Includes Rs. 2137.75 lakhs; Previous year : Rs. 2069.80 lakhs due to small scale industrial units)
Deposits
Interest accrued but not due on loans
Unpaid dividends*
Unclaimed fixed deposits*
Unpaid interest on matured fixed deposits*
* There is no amount due and outstanding to be credited to Investor Education and Protection Fund
SCHEDULE 12 : PROVISIONS
Retirement Benefits :
Leave encashment
Gratuity
Ex-gratia gratuity
Others :
Provision for taxation (Net of advance payment of Income tax)
Provision for unearned premium *
Provision for stamp duty in connection with Integration *
Proposed dividend
Corporate Tax on proposed dividend
* (See note 6, Schedule 19)
60
Schedules forming part of the Consolidated Profit and Loss Account
SCHEDULE 13 : OTHER INCOME
April 06 to
December 06
Rs. lakhs
Dividend on long term non-trade investments
Dividend on current non-trade investments
April 05 to
March 06
Rs. lakhs
—
3.27
61.44
294.55
253.50
404.60
Profit on sale of fixed assets (Net)
32.62
56.98
Cash discount
24.87
16.81
Rental income
256.14
346.56
Indenting commission
279.06
421.88
Exchange Gain (Net)
40.68
—
71.58
139.27
9.81
15.17
Export Incentives
Profit on sale/changes in the carrying amount of current investments (Net)
Profit on sale/changes in the carrying amount of long term investments (Net)
Miscellaneous (See note 14(a), Schedule 19)
33.24
39.52
1361.30
1074.11
2424.24
2812.72
April 06 to
December 06
Rs. lakhs
April 05 to
March 06
Rs. lakhs
29982.56
33135.97
SCHEDULE 14 : COST OF MATERIALS
Raw materials consumed
Less : Raw materials consumed on trial production
Packing materials consumed
Purchase of finished goods (Previous year : Net of goods destroyed in flood)
12.75
—
29969.81
33135.97
1664.88
1790.84
13600.13
21552.87
6762.46
3538.34
(Increase)/Decrease in stocks of finished goods and work-in-progress :
Opening stock
Finished goods
Add : Opening stock on commencement of Commercial Production
Work-in-progress
19.12
—
—
2636.72
6781.58
6175.06
1752.55
1181.69
—
290.20
1752.55
1471.89
8534.13
7646.95
Finished goods
6891.48
6762.46
Work-in-progress
1308.18
1752.55
Less: Closing stock
8199.66
8515.01
334.47
(868.06)
45569.29
55611.62
* (See note 1 (a), Schedule 19)
61
SCHEDULE 15 : PERSONNEL COST
Salaries, wages, bonus, etc.
Contribution/Provision for provident fund, superannuation scheme,
gratuity fund, etc. [See note 14(b), Schedule 19]
Welfare expenses
Less: Charged to capital accounts
April 06 to
December 06
Rs. lakhs
4313.47
10.43
April 05 to
March 06
Rs. lakhs
5040.38
—
583.24
606.50
5513.64
33.99
5479.65
1189.60
829.71
7059.69
26.96
7032.73
April 06 to
December 06
Rs. lakhs
April 05 to
March 06
Rs. lakhs
4.62
200.55
205.17
135.34
349.78
485.12
148.42
63.50
211.92
(6.75)
196.99
283.98
480.97
4.15
April 06 to
December 06
Rs. lakhs
April 05 to
March 06
Rs. lakhs
626.27
1100.99
568.66
248.04
176.19
3412.86
373.88
395.31
198.00
1391.31
671.71
207.23
619.14
1449.48
74.72
—
121.93
108.95
172.43
—
—
—
3303.07
14119.18
1.28
14117.90
782.59
454.94
324.71
3677.13
424.10
559.31
291.32
1459.47
853.39
280.51
715.60
1743.88
80.93
117.74
151.65
141.03
47.84
35.57
130.84
925.85
3073.72
17373.11
—
17373.11
SCHEDULE 16 : INTEREST (NET)
Interest Paid
On loans for fixed period
Others
Less: Interest received (Gross);
(Tax deducted at source Rs. 14.91 lakhs; Previous year: Rs. 37.93 lakhs)
On Investments – Long term Non-Trade
Others
SCHEDULE 17 : OTHER EXPENDITURE
Stores and Spare parts etc. consumed
Repairs and maintenance:
Plant and machinery
Buildings
Others
Power and fuel
Rent (including lease payments) {See note 8, Schedule 19}
Rates and taxes (including water charges)
Insurance
Clearing, Forwarding and transport
Travelling and Conveyance
Commission
Cash Discount
Other discounts on sales
Assets written-off
Bad debts and advances written-off
Excise Duty (Net)
Exchange Loss (Net)
Flood Loss (Net)
Integration Expenses (See note 14 (c), Schedule 19)
Miscellaneous (See note 12, Schedule 19)
Less: Charged to capital accounts
62
Notes
Notes to the Consolidated financial statements
Schedule 18
Forming Part of the Balance Sheet and Profit and Loss Account for the nine months period ended 31st December, 2006
SIGNIFICANT ACCOUNTING POLICIES:
BASIS OF PREPARATION
The Consolidated Financial Statements are prepared in accordance with Accounting Standard (AS)21 on Consolidated Financial Statements issued by
The Institute of Chartered Accountants of India. The Consolidated Financial Statements comprise the financial statements of Clariant Chemicals (India)
Limited and its subsidiary viz. Chemtreat Composites India Private Limited (voting power-100%). The said Company became subsidiary on and from
February 13, 2006. This subsidiary company is incorporated in India.
The financial statements are prepared at historical cost on the accrual basis of accounting and in accordance with the standards on accounting issued
by the Institute of Chartered Accountants of India and referred to in Section 211(3C) of the Companies Act, 1956. The significant accounting policies are
as follows:
1.
SALES
The Company recognises sale of goods on despatch to customers. Sales are net of excise duty, sales tax and trade discounts, wherever applicable.
2.
EXCISE DUTY
Excise duty payable on products is accounted for at the time of despatch of goods from the factories but is accrued for stocks held at the year end.
3.
RESEARCH AND DEVELOPMENT
Revenue expenditure on research and development is written off in the Profit and Loss Account in the year in which it is incurred. Capital
expenditure on research and development is treated in the same way as expenditure on fixed assets.
4.
RETIREMENT BENEFITS
(a)
Retirement benefits to employees comprise of payment to gratuity, superannuation and provident funds and ex-gratia gratuity under the rules
of the company.
(b)
Liabilities in respect of retirement gratuity benefit to employees are provided in terms of The Payment of Gratuity Act, 1972 or the Company’s
Gratuity Scheme approved by the Commissioner of Income-tax, whichever is beneficial. The adequacy of the fund is confirmed by an actuarial
valuation obtained at the year end.
Contributions for superannuation made to LIC under the Company’s Superannuation Scheme are charged to the Profit and Loss Account.
Contributions to the Provident Funds are made at a pre-determined rate and charged to the Profit and Loss Account.
(c)
5.
Liabilities in respect of leave encashment benefit and ex-gratia gratuity payable on retirement to a category of employees, are provided based
on an actuarial valuation obtained at the year end and charged to the Profit and Loss Account.
VOLUNTARY RETIREMENT SCHEME
Expenditure incurred on voluntary retirement scheme is amortised over a period of three years.
6.
FIXED ASSETS AND DEPRECIATION
(A)
All fixed assets are stated at cost less depreciation, wherever applicable. Cost comprises the purchase price and any other attributable cost
of bringing the asset to its working condition for its intended use. Borrowing cost relating to funds borrowed for acquisition of qualifying
assets for the year upto the date the assets are put to use is included in cost.
(B)
The cost of leasehold land is amortised over the period of the lease.
(C)
Intangible assets are being amortised equally over a period of three years.
(D)
Depreciation has been calculated on the straight line method at the rates and in the manner specified in Schedule XIV of the Companies Act,
1956 except for :
(a)
certain items of furniture, fixture, vehicle, plant, machinery and equipment on which a depreciation rate of 20% on straight line method is
applied;
(b)
electronic data processing (EDP) hardware such as servers on which a depreciation rate of 20% and for other EDP equipments including
personal computers and printers on which depreciation rate of 25% on straight line method is applied;
63
(c)
Exchange differences capitalised which are depreciated over the remaining useful life of the assets.
(See note 16 and 17, Schedule 19).
7. IMPAIRMENT OF ASSETS
The carrying amount of assets are reviewed at each Balance Sheet date if there is any indication of impairment based on internal/external factors.
An impairment loss will be recognised wherever the carrying amount of an asset exceeds its estimated recoverable amount. The recoverable
amount is greater of the asset’s net selling price and value in use. In assessing the value in use, the estimated future cash flows are discounted to
the present value using the weighted average cost of capital. Previously recognised impairment loss is further provided or reversed depending on
changes in circumstances.
8. INVENTORIES
Inventories are valued at the lower of cost and estimated net realisable value after providing for obsolescence. The cost of inventories is generally
arrived at on the following bases:
Raw materials, packing materials, trading items and stores and spares
— Weighted average cost.
Finished goods and work-in-progress
— Absorption costing at works cost.
9. SUNDRY DEBTORS/LOANS AND ADVANCES
Sundry debtors and loans and advances are stated after making adequate provision for doubtful debts/advances.
10.
INVESTMENTS
Long term investments are stated at cost less provision for diminution in value, other than temporary. Current investments are stated at the lower of
cost and fair value. Dividends are accounted for when the right to receive the dividend payment is established.
11.
LEASES
Leases where the lessor effectively retains substantially all the risks and benefits of ownership of the leased assets are classified as operating
leases. Operating lease payments are recognised as an expense in the Profit and Loss Account on a straight-line basis over the lease term.
12.
13.
FOREIGN CURRENCY TRANSLATIONS
(a)
Monetary items denominated in foreign currency are translated at the exchange rate prevailing on the last day of the accounting year. In
respect of items covered by forward contracts, the premium or discount arising at the inception of such a forward exchange contract is
amortised as expense or income over the life of the contract. Any profit or loss arising on cancellation of such a forward exchange contract
is recognised as income or expense for the period. Foreign currency transactions are accounted at the rate prevailing on the date of
transaction.
(b)
Non-monetary items other than fixed assets, which are carried in terms of historical cost denominated in a foreign currency are reported
using the exchange rate at the date of transaction.
(c)
Gain or loss arising out of translation/conversion is taken credit for or charged to the Profit and Loss Account except exchange differences
arising due to repayment or restatement of liabilities incurred for the purpose of acquiring of fixed assets in respect of transactions in
foreign currencies entered into prior to April 1, 2004 and in respect of any fixed asset that has been acquired from a country outside India,
in which case the exchange differences are adjusted in the carrying amount of the respective fixed assets.
INCOME TAX
Income tax expense comprises current tax and deferred tax charge or credit. The current tax is determined as the amount of tax payable in respect
of the estimated taxable income for the year. The deferred tax charge or credit is recognised using prevailing enacted or substantively enacted tax
rates. Where there are unabsorbed depreciation or carry forward losses, deferred tax assets are recognised only if there is virtual certainty of
realisation of such assets. Other deferred tax assets are recognised only to the extent there is reasonable certainty of realisation in future. Deferred
tax assets/liabilities are reviewed at each Balance Sheet date based on developments during the year and available case laws, to reassess
realisation/liabilities.
14.
CONTINGENCIES/PROVISIONS
Provision is recognised when the Company has a present obligation as a result of past event; it is probable that an outflow of resources embodying
economic benefit will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions are not discounted to its
present value and are determined based on best estimate of the expenditure required to settle the obligation at the Balance Sheet date. These are
reviewed at each Balance Sheet date and adjusted to reflect the current best estimate. A contingent liability is disclosed, unless the possibility of
an outflow of resources embodying the economic benefit is remote.
64
Notes
Schedule 19
Notes on the Balance Sheet and Profit and Loss Account for the nine months period ended 31st December, 2006
1.
(a)
In accordance with the Scheme of Amalgamation (‘the Scheme’) of erstwhile Clariant (India) Limited, Vanavil Dyes and Chemicals Limited,
BTP India Private Limited and Kundalika Investments Limited (herein after referred to as the “Transferor Companies”) with the Company as
approved by the members at a Court convened Extra Ordinary General Meeting held on 8th December, 2005 and subsequently sanctioned
by the Honourable High Court of Judicature at Madras on 22nd February, 2006 and Honourable High Court of Judicature at Bombay on
24th February, 2006 which was modified vide order dated 17th March, 2006, the entire business and the whole of the undertaking of the
Transferor Companies being all its assets and properties and all its debts and liabilities as defined in the Scheme have been transferred to
and vested in the Company retrospectively with effect from 1st April, 2005. The Scheme had accordingly been given effect to in the previous
accounting year.
(b)
The Board of Directors in their meeting held on 14th September, 2006 had decided to change the accounting year from financial year
April-March to calendar year January-December. Accordingly, the Company has closed its accounting year for a period of 9 months ended
31st December, 2006.
In view of the above, the figures of current reporting period of 9 months ended 31st December, 2006 are not strictly comparable with the
figures relating to previous reporting period of 12 months ended 31st March, 2006.
2.
Segment Information for the nine months period ended 31st December, 2006 (As required by Accounting Standard (AS)-17 ‘‘Segment
Reporting’’)
(a)
The Company is organised into three primary business segments mainly:
(i)
Intermediates & Colours:
Consist of pigment dyestuffs and their dispersion, Intermediates for dyes, pesticides and pharmaceuticals.
(ii)
Dyes & Specialty Chemicals:
Includes dyestuff synthetic resins, binder materials, auxiliaries and chemicals.
(iii) Masterbatches:
Covers commodity and specialty Masterbatches for Plastics and nylon fibers.
(b)
The secondary segments of the company are geographical segments mainly:
(i)
India.
(ii)
Outside India.
(c)
Segments have been identified and reported taking into account the nature of products and services, the differing risk and returns, the
organisation structure and the internal financial reporting system.
(d)
Segment Revenue in each of the above Business Segments primarily includes Sales and Processing Charges.
(e)
(i)
Segment Revenue and Results:
The expenses which are not directly attributable to the business segment are shown as unallocated corporate cost.
(ii)
Segment assets and liabilities:
Segment assets include all operating assets used by the business segment and consist principally of fixed assets, debtors and
inventories. Segment liabilities primarily include creditors and other liabilities.
(iii) Assets and liabilities that cannot be allocated between the segments are shown as a part of unallocable corporate assets and
liabilities respectively.
Information about Primary Business Segments:
Rs. lakhs
Inter- Dyes and
Mastermediates Specialty
batches
& Colours Chemicals
Revenue
External Sales/Revenue
Less: Inter Segment Revenue
Total Revenue (Net)
Results
Segment Results
Unallocated Corporate Expenses (Net)
Operating profits
Interest Income/Dividend income
Interest Expenses
Total
Rs. lakhs
Inter- Dyes and Mastermediates Specialty batches
& Colours Chemicals
Total
26072.52
—
26072.52
41350.61
—
41350.61
1790.49
—
1790.49
69213.62
—
69213.62
35510.33
—
35510.33
48401.28
—
48401.28
1684.54
—
1684.54
85596.15
—
85596.15
1398.08
4804.66
244.48
6447.22
(1112.98)
5334.24
273.36
(205.17)
1526.98
6360.43
125.52
8012.93
(1827.85)
6185.08
778.79
(485.12)
65
Information about Primary Business Segments: (Contd.)
Rs. lakhs
Inter- Dyes and
Mastermediates Specialty
batches
& Colours Chemicals
Profit Before Taxation
Current Tax/Deferred Tax
Fringe Benefit Tax
Profit After Tax
Other Information
Segment Assets
Unallocated Corporate Assets
Total Assets
Segment Liabilities
Unallocated Corporate Liabilities
Total Liabilities
Capital Expenditure
Unallocated Corporate Capital Expenditure
Total Capital Expenditure
Depreciation
Unallocated Corporate Depreciation
Total Depreciation
Non-cash expenses other than
Unallocated Corporate Non-cash expenses
other than Depreciation/Amortisation
Total Non-cash expenses other than
Total
Rs. lakhs
Inter- Dyes and Mastermediates Specialty batches
& Colours Chemicals
5402.43
(1748.97)
(85.25)
3568.21
21091.07
22421.43
1355.84
8164.59
9773.31
336.06
811.59
852.60
121.57
880.46
569.72
56.19
0.35
55.50
3.96
Total
6478.75
(2215.69)
(227.99)
4035.07
44868.34
12334.77
57203.11
18273.96
1512.18
19786.14
1785.76
723.28
2509.04
1506.37
39.33
1545.70
23939.83
21275.02
1123.85
7535.94
8885.87
280.33
2068.99
935.53
72.71
1321.45
884.67
59.05
59.81
92.34
136.69
9.91
46338.70
15425.89
61764.59
16702.14
3032.46
19734.60
3077.23
35.32
3112.55
2265.17
182.25
2447.42
238.94
8.07
831.49
67.88
1070.43
Information about Secondary Segments:
Rs. lakhs
Revenue by Geographical Market
External Sales
Segment Assets
Additions to Fixed Assets
India
52302.59
40577.70
1785.76
Outside India
16911.03
4290.64
—
Rs. lakhs
Total
69213.62
44868.34
1785.76
India
62201.88
43185.53
3077.23
Outside India
23394.27
3153.17
—
Total
85596.15
46338.70
3077.23
Footnotes:
(i)
Total assets do not include:
(a) Advance income tax Rs. 1727.93 lakhs (Rs. 1472.42 lakhs)
(b) Miscellaneous Expenditure Rs. 177.25 lakhs (Rs. NIL)
(ii)
Total Liabilities exclude the following:
(a) Proposed dividend Rs. 4798.93 lakhs (Rs. 2932.68 lakhs)
(b) Tax on dividend Rs. 673.05 lakhs (Rs. 411.31 lakhs)
(c) Provision for Taxation Rs. 901.86 lakhs (Rs. 832.99 lakhs)
(d) Deferred Tax liability (Net) Rs. 1024.82 lakhs (Rs. 525.85 lakhs)
3.
Related Party Disclosure as required by Accounting Standard – 18 “Related Party Disclosures” are given below:
Relationship:
(a)
Holding Company:
EBITO Chemiebeteiligungen AG, Clariant International AG and Clariant Participations AG, Switzerland together hold 63.40% equity shares in
the company, the ultimate holding company being Clariant AG, Switzerland.
(b)
Other related parties in the Clariant group where common control exists:
Fellow Subsidiaries:
Clariant Life Science Molecules (Florida) Inc., USA
Clariant (Guatemala) S.A., Guatemala
Clariant Life Science Molecules (America) Inc., USA
Clariant (Mexico) S.A. de C.V., Mexico
US dormant BTP – Companies
Clariant Productos Quimicos S.A. de C.V., Mexico
Clariant (Argentina) S.A., Argentina
Clariant (Peru) S.A., Peru
Clariant S.A., Brazil
Clariant (Uruguay) S.A., Uruguay
Clariant Colorquímica (Chile) Ltda., Chile
Clariant (Venezuela) S.A., Venezuela
Clariant (Colombia) S.A., Colombia
Clariant (Australia) Pty. Ltd., Australia
66
Notes
(b)
Other related parties in the Clariant group where common control exists: (Contd.)
Clariant (Tianjin) Ltd., China
Clariant Chemicals (China) Ltd., China
Clariant Masterbatches (Guangzhou) Ltd.
Clariant Pigments (Tianjin) Ltd., China
Clariant Masterbatches (Beijing) Ltd., China
Clariant Masterbatches (Shanghai) Ltd., China
Clariant Trading (China) Ltd.
Clariant (China) Ltd., Hong Kong
Clariant Chemicals (Guangzhou) Ltd.
P.T. Clariant Indonesia, Indonesia
Clariant (Japan) K.K., Japan
Dia Fine K.K., Japan
Clariant (Korea) Ltd., South Korea
Clariant Masterbatches (Korea) Ltd.
Clariant Pigments (Korea) Ltd.
Clariant (Malaysia) Sdn. Bhd., Malaysia
Clariant Masterbatches (Malaysia) Sdn. Bhd., Malaysia
Clariant (New Zealand), Ltd., New Zealand
Clariant (Singapore) Pte. Ltd., Singapore
Clariant Chemicals (Thailand) Ltd., Thailand
Clariant Masterbatches (Thailand) Ltd., Thailand
Clariant Chemicals (Taiwan) Co. Ltd., Taiwan
Clariant (Gulf) FZE, United Arab Emirates
Egyptian German Company for Dyes & Resins S.A.E., Egypt
Clariant (Egypt) S.A.E., Egypt
Clariant Masterbatches (Saudi Arabia) Ltd.
Clariant (Maroc) S.A., Morocco
Clariant (Pakistan) Ltd., Karachi, Pakistan
Clariant Türkiye A.S., Turkey
Clariant Southern Africa (Pty) Ltd., South Africa
BTP World S.A., Luxembourg
Clariant Finanz AG, Switzerland
Clariant Reinsurance Ltd., Bermuda
Clariant Insurance (Liechtenstein) AG, Liechtenstein
Clariant Finance (BVI) Ltd., British Virgin Islands
Clariant Beteiligungen AG
Clariant Chemiebeteiligungen AG
Clariant (Sverige) Holding AB
Clariant Participations B.V., Netherlands
Clariant (Oesterreich) GmbH, Austria
Clariant Benelux S.A., Belgium
Clariant Service (Schweiz) AG
Clariant Finance (Luxembourg) S.A., Luxembourg
Clariant Produkte (Schweiz) AG
Clariant Corporation, USA
Clariant Consulting (Middle East) Ltd., Switzerland
BCI Betriebs-AG, Switzerland
Clariant Oil Services Ltd., Switzerland
Clariant CR s.r.o., Czech Republic
Abieta Chemie GmbH, Gersthofen, Germany
InfraServ GmbH & Co. Gendorf KG, Germany
InfraServ GmbH & Co. Höchst KG, Germany
InfraServ GmbH & Co., Knapsack KG, Germany
InfraServ GmbH & Co., Ruhrchemie KG, Germany
InfraServ GmbH & Co., Wiesbaden KG, Germany
Industriepark Griesheim Verwaltungs GmbH, Germany
Clariant Beteiligungs-GmbH, Germany
Clariant Vertrieb (Deutschland) Verwaltungs GmbH, Germany
Clariant Zweite Chemie GmbH, Germany
ITN Nanovation AG
EPS Ethylen-Pipeline-Süd GmbH & Co. KG
Ethylen-Pipeline-Süd Geschäftsführungs GmbH
Aguas Industriales de Tarragona S.A., Spain (AITASA)
S.T.E.I.H. Sàrl, France
Clariant (Hellas) S.A., Greece
Clariant Export AG
Clariant (Canada) Inc., Canada
Clariant Consulting AG, Switzerland
Clariant Vertrieb (Deutschland) GmbH & Co. KG
Clariant Specialty Fine Chemicals (Deutschland) GmbH
Clariant Masterbatches (Deutschland) GmbH
Industriepark Griesheim GmbH & Co. KG, Germany
Technische Services Gersthofen GmbH
Clariant (Danmark) A/S, Denmark
Clariant Ibérica Servicios S.L.
Clariant Ibérica Producción S.A.
Clariant Ibérica Comercial S.L.
Clariant Masterbatch Ibérica S.A., Spain
Clariant (Finland) Oy, Finland
Clariant Huningue, France
K.J. Quinn, France
Clariant (France), France
Clariant LSM (France) Holding EURL, France
Clariant Specialty Fine Chemicals (France) S.A.S.
Clariant Masterbatch Huningue S.A.S.
Clariant Masterbatches (France) S.A.S.
Clariant Masterbatches (St. Jeoire)
Clariant Holdings UK Ltd., Great Britain
Clariant UK Ltd., Great Britain
UK dormant Clariant – Companies, Great Britain
Clariant Horsforth Ltd., Great Britain
BTP Ltd., Great Britain
BTP Insurance Company Ltd., Great Britain
UK dormant BTP – Companies, Great Britain
Clariant Masterbatches UK Ltd.
Masterplast Ltd., Ireland
Clariant Masterbatches (Italia) SpA.
Clariant Life Science Molecules (Italia) SpA., Italy
Clariant Servizi (Italia) S.p.A.
Clariant Prodotti (Italia) S.p.A.
Clariant Distribuzione (Italia) S.p.A.
Dick Peters B.V., Netherlands
Clariant (Norge) AS, Norway
Clariant Quimicos (Portugal) Lda., Portugal
Clariant (Sverige) AB, Sweden
Clariant Masterbatches Norden AB, Sweden
Clariant Polska Sp. z.o.o., Poland
Colex Sp. z.o.o., Poland
Clariant Europa EWIV
Clariant Hungaria Kft, Hungary
Omnexus N.V., Netherlands
Clariant (RUS) LLC, Russian Federation
Clariant Distribucija SL, d.o.o., Slovenia
Clariant (Ecuador) S.A., Ecuador
Concentrados Plasticolor S.A., Guatemala
Clariant (Honduras) S.A., Honduras
Clariant Trading (Panama) S.A., Panama
Clariant (El Salvador) S.A. de CV, El Salvador
Clariant (Bangladesh) Ltd., Bangladesh
Hangzhou Baihe Clariant Pigments Co., Ltd.
Chemcolour Industries (NZ) Ltd., New Zealand
Clariant (Philippines) Corp., Philippines
Clariant (Vietnam) Ltd., Vietnam
Clariant Oil Services Angola Lda., Angola
Clariant Tunisie S.A., Tunisia
Compagnie Tunisienne de Chimie Industrielle, Tunisia
67
(b)
Other related parties in the Clariant group where common control exists: (Contd.)
Kemoks Kimya Sanayi, Turkey
International School of the Basel Region AG, Switzerland
Starfire Systems Inc., U.S.A.
(c)
Key Management Personnel:
H. Meier
During the period the following transactions were entered into with related parties:
(i)
Holding Company, Fellow Subsidiaries and Associates:
April 06 to
December 06
Rs. lakhs
April 05 to
March 06
Rs. lakhs
909.53
501.07
84.67
108.44
—
56.73
5065.25
3889.26
345.01
374.36
898.38
364.50
668.25
490.02
1627.90
1272.99
153.05
175.47
3221.88
2908.30
Clariant Corporation
2116.85
1956.21
Clariant (China) Ltd.
1445.32
1466.24
Clariant UK Ltd.
1387.55
686.16
Others
4525.89
12310.96
79.49
206.52
Holding Company:
Transactions during the period:
Sale of Goods
Purchase of Goods
Dividend Paid
Balances outstanding as at the end of the period:
Amount Payable
Amount Receivable
Sale of Goods
Clariant Export AG
Others
132.48
41.89
51.72
150.26
7.91
1631.65
374.93
457.28
Purchase of Goods
Clariant UK Ltd.
Clariant Benelux SA
1758.00
28.81
Others
1230.11
1925.69
Clariant UK Ltd.
—
34.62
—
9.49
21.22
3.48
4.06
0.23
14.35
40.28
Clariant SA Brazil
Clariant Southern Africa (Pty.) Ltd.
Others
68
Notes
During the period the following transactions were entered into with related parties: (Contd.)
(i) Holding Company, Fellow Subsidiaries and Associates: (Contd.)
April 06 to
December 06
Rs. lakhs
April 05 to
March 06
Rs. lakhs
292.60
570.00
Holding Company:
Dividend Paid
BTP Ltd., UK
406.57
474.85
3023.04
2567.91
Chemcolour Industries (NZ) Ltd.
15.65
11.10
Clariant (Philippines) Ltd.
32.98
—
6.59
13.91
18.02
11.03
3.04
1.77
3.66
—
Amount Payable
Amount Receivable
Sale of Goods
Purchase of Goods
Abieta Chemie GmbH
Clariant (Philippines) Corp.,
Amount Payable
Amount Receivable
(ii)
—
17.74
5.27
2.51
Key Management Personnel:
111.76
114.53
Remuneration paid to ex-Vice Chairman & Managing Director of erstwhile Clariant (India) Ltd.
—
125.09
Sale of Assets
—
9.39
15.75
33.09
Remuneration paid
Commission Payable (Net)
(iii) Relatives of the Key Management Personnel:
Rent Payment
4.
5.
—
11.88
April 06 to
December 06
April 05 to
December 06
Earnings per share :
(a)
(b)
Net profit after taxation for the period (Rs. lakhs)
Number of equity shares outstanding
3568.21
26660745
4035.75
11650000
(c)
(d)
(e)
(f)
Number of shares in Share Capital Suspense Account
Total (b) + (c)
Basic & Diluted earnings per share (In Rupees)
Face value per share (In Rupees)
—
26660745
13.38
10.00
15010745
26660745
15.14
10.00
April 06 to
December 06
Rs. lakhs
April 05 to
December 06
Rs. lakhs
27.25
331.99
53.07
202.81
508.09
1.21
1124.42
51.31
356.93
94.90
247.28
802.09
1.21
1553.72
Deferred Taxes:
The major components of deferred tax assets and deferred tax liabilities are set out below:
Deferred Tax Assets
(i) Provision for Doubtful debts
(ii) Provision for retirement benefits
(iii) Expenses allowable for tax purposes when paid
(iv) Integration Expenses
(v) Payment/Provision for Voluntary Retirement Scheme
(vi) Others
69
April 06 to
December 06
Rs. lakhs
April 05 to
December 06
Rs. lakhs
2149.24
2079.57
2149.24
2079.57
(1024.82)
(525.85)
5. Deferred Taxes: (Contd.)
Deferred Tax Liabilities
Deferred Tax Assets/(Liabilities) – Net
6. The movements in the provisions are summarised as under:
Rs. lakhs
As on
1st April,
2006
Additional
provision made
during the period
Amount used/
As on
Reversed 31st December,
2006
during the period
As on
31st March,
2006
(i)
Provision for Unearned premium in
respect of Sale of Land
650.00
—
650.00
—
650.00
(ii)
Provision for Stamp Duty pursuant to the
Scheme of Amalgamation
741.50
—
741.50
—
741.50
7. On 15th February, 2005, the Company had received an order of the Sub-Divisional, Thane demanding Rs.121 lakhs for the lease of land to Thane
Municipal Corporation, Fire Brigade and Maharashtra State Electricity Board without obtaining prior permission in writing against which the
Company had filed a writ petition on 23rd February, 2005 before the Bombay High Court. The Hon’ble High Court has granted interim stay in terms of
the petition on 14th July, 2005.
8. In respect of all assets taken on lease on or after 1st April, 2001:
(a) In respect of Operating leases, where lease agreements have been formally entered into, minimum
lease payments recognised in the Profit and Loss Account for the period are as follows:
Residential flats, office premises, vehicles, equipment and machinery, computers etc.
(b)
(c)
April 06 to
December 06
Rs. lakhs
April 05 to
March 06
Rs. lakhs
360.33
406.53
There are no restrictions such as those concerning dividends, additional debt and further leasing,
imposed by the lease agreements entered into by Clariant Chemicals (India) Limited.
Contingent rent payments in respect of vehicles are dependent upon the excess of actual usage, if
any, over stipulated usage.
9. Expenditure on Research and Development during the period:
(a)
Capital expenditure
(b)
Revenue expenditure charged to Profit and Loss Account
10.
Estimated amount of contracts remaining to be executed on capital account and not provided for
11.
Contingent liabilities not provided for (also see note 7, Schedule 19):
(a)
In respect of income tax matters decided against the Company, in respect of which the Company is
in further appeal
decided in favour of the Company against which the department is in appeal
23.90
37.16
358.07
563.87
381.97
601.03
315.60
175.15
1095.55
986.66
14.78
14.78
(b)
In respect of sales tax matters
297.92
77.82
(c)
In respect of excise matters
819.95
639.53
(d)
In respect of bills of exchange discounted with banks [since realised Rs. 1401.74 lakhs
(Rs. 895.39 lakhs)]
2555.84
1589.06
(e)
Other matters in dispute
6.76
6.76
(f)
Disputed Labour matters – Amount not ascertained.
In respect of items (a) to (c), (e) & (f) future cash outflows in respect of contingent liabilities is
determinable only on receipt of judgements pending at various forums/authorities.
70
Notes
12.
Miscellaneous Expenses in Schedule 17: Other Expenditure include:
(a)
Audit fees
(ii)
Company law matters
(iv) Other services - miscellaneous reports
(v)
13.
April 05 to
March 06
Rs. lakhs
(Excluding
Service Tax)
22.00
35.54
—
3.50
Auditors’ remuneration and expenses:
(i)
(iii) Taxation services
(b)
(c)
April 06 to
December 06
Rs. lakhs
(Excluding
Service Tax)
Out-of-pocket expenses
—
5.80
26.00
25.62
1.22
2.02
49.22
72.48
Non Compete Fees of Rs. 154.20 lakhs (Rs. NIL) paid to ex-Managing Director.
Legal & Professional charges of Rs. 769.70 lakhs (Rs. 243.90 lakhs) towards consultancy.
Amount paid/payable by Clariant Chemicals (India) Limited to Directors (including Managing Director) as remuneration for services rendered in any
capacity:
April 06 to
December 06
Rs. lakhs
1.22
1.68
Salaries
95.85
38.72
Commission
23.75
42.31
0.16
39.50
120.98
122.21
Directors’ sitting fees
Other perquisites and benefits in cash or in kind
Note: (i)
(ii)
14. (a)
(b)
(c)
Provision for leave encashment and gratuity benefit which is based on actuarial valuation done on an overall Company basis is
excluded from above.
Excludes non compete fees of Rs.154.20 lakhs paid to ex-Managing Director
In respect of the period April 2005 to March 2006:
•
In the absence of records, the quantum of excess remuneration paid, if any, as compared to the 1969 Managerial
Remuneration Guidelines in respect of a sum of Rs. 3.33 lakhs paid to an ex-managing director of erstwhile Clariant (India)
Limited for the years 1981 and 1982, has not been ascertained.
•
Excludes remuneration of Rs.125.09 lakhs paid to ex-managing director and Rs.6.50 lakhs payable to non wholetime directors
of erstwhile Clariant (India) Limited.
•
Excludes sitting fees of Rs.1.64 lakhs & Rs.1.62 lakhs paid to the non wholetime directors of erstwhile Clariant (India) Limited
and erstwhile Vanavil Dyes and Chemicals Limited respectively.
•
Excludes Rs. 62.20 lakhs paid to ex-managing director of erstwhile Clariant (India) Limited as consultant of the Company for a
period from 20th March, 2006 to 31st March, 2006.
Miscellaneous Income includes Rs. 220 lakhs (Rs. NIL) towards Remnant Cost received from Dystar India Ltd. on termination of Toll
Manufacturing agreement w.e.f. 1st April, 2006.
In respect of previous year Contribution to Provident fund, Superannuation scheme, Gratuity fund, etc. under ‘Personnel Cost’
(Schedule-15) includes contribution of Rs.330 lakhs on account of the higher actuarial liability of gratuity as on 31st July, 2005 determined
by the Company’s actuary appointed during the year as against the acturial liability of gratuity determined by the Company’s previous
actuary as on 31st March, 2005.
Other Expenditure (Schedule-17) includes Integration expenses as follows , incurred by the Company on amalgamation of erstwhile Clariant
(India) Limited, Vanavil Dyes and Chemicals Limited, BTP India Private Limited and Kundalika Investments Limited with the Company, pursuant
to the Scheme of Amalgamation.
April 06 to
December 06
Rs. lakhs
15.
April 05 to
March 06
Rs. lakhs
April 05 to
March 06
Rs. lakhs
Legal and Professional Fees
—
63.35
Rates and taxes
—
754.10
Others
—
108.40
—
925.85
The company has not amortised the Goodwill arising out of the acquisition of subsidiary company as against the previous year’s policy of amortising
it over a period of five years. As a result, the profit before tax for the period is higher and Depreciation/Amortisation charge for the period is lower,
each by Rs. 33.97 lakhs (Rs. NIL).
71
16.
Hitherto depreciation in respect of buildings, furniture, fixtures and office appliances and vehicles existing as on 31st March, 1995 has been
calculated on written down value method at the rates and in the manner specified in Schedule XIV of the Companies Act, 1956 except for certain
items of furniture, fixtures and vehicles on which a depreciation rate of 20% on straight line method is applied. During the period, the Company has
changed the method of calculating depreciation from written down value method to straight line method which has resulted in reversal of
depreciation of Rs. 399.70 lakhs (Rs. NIL). As a result of the change in the method of depreciation, the depreciation charge for the period is lower
and profit before tax for the period is higher, each by Rs.399.70 lakhs (Rs. NIL).
17.
From 1st April, 2006 the Company has changed the rate of depreciation as follows:
Depreciation
Rate
Plant and Machinery (Continous Process Plant)
Vehicles
From
1st April, 2006
Upto
31st March, 2006
6.67%
5.28%
20.00%
9.50%
As a result of the change in the rate of depreciation, the depreciation charge for the period is higher and the profit before tax is lower, each by
Rs. 333.43 lakhs (Rs. NIL).
18.
During the period the Company has changed it’s policy in respect of accounting for voluntary retirement expenses by amortising the expenses over
a period of three years as against the earlier policy of charging it in the year when incurred. As a result ‘Personnel Cost’ for the period is lower and
profit before tax for the period is higher, each by Rs. 177.25 lakhs (Rs. NIL).
19.
Figures for the Previous year have been regrouped wherever necessary to conform to the current period’s classification.
20.
The figures in brackets are those in respect of the previous accounting year.
72
Financial and Operational Analysis
1.
Shareholders Funds
Shareholders Funds also known as Networth
represents Shareholders ownership in the Company. It
comprises of money directly invested by shareholders
i.e. Share capital and all earnings reinvested back in to
the Company i.e. Reserves and surplus. Networth of any
business enterprise signifies its financial soundness
and solvent position of a going concern. The annualised
return on Networth as at 31st December 2006 is 14%
indicating what the Company has been able to earn on
the equity entrusted to it.
1.1 Share Capital
The Company has only one class of shares viz. Equity
shares of Rs. 10/- each. While the Authorised Capital of
the Company remained unchanged at 300 lakhs equity
shares, the Issued and paid up capital increased
pursuant to 1,50,10,745 equity shares issued to the
shareholders of the transferor companies in terms of
the scheme of amalgamation. Promoters shareholding
remained unchanged at 63.40%.
is generally met from the internal accruals and
short-term borrowings from banks. In view of the
negligible borrowings, the debt equity ratio as on
31st December, 2006 is 0.02. Considering the cash and
bank balances available, as on the date the Company is
virtually debt free.
2.1 Secured Loans
Secured loans consist of short-term borrowings from
consortium of banks for working capital requirements.
These borrowings are secured by way of lien/
hypothecation of inventories, book debts and other
monies receivable and by endorsement of certain
export documents. The balance outstanding as on
31st December, 2006 amounting to Rs. 142 lakhs mainly
comprise of export credits availed by Company at
concessional rate of interest.
2.2 Unsecured loans
Unsecured loans consist of Rs. 479 lakhs interest free
sales tax deferral scheme granted by Government of
Tamil Nadu. During the period Rs. 42 lakhs was repaid.
The ratio of Shareholders' Fund to the borrowed Funds
as at 31st December, 2006 is 98:2.
1.2 Reserves and Surplus
The Company’s Reserves and surplus comprises of
Balance in Reserves and Profit and Loss Account built
out of retained earnings. The reserves consists of
Capital reserve, Securities premium reserve, General
reserve and reserves created as per statutory
requirements. The Ratio of Paid up share capital and
Reserves and surplus as at 31st December, 2006 stands
at 9:91.
3.
Fixed Assets
Fixed assets consist of assets created by Company over
a period of time. The assets of Company have never
been revalued in the past and therefore, the gross block
consists of original cost of the assets acquired. During
the period the Company has added Rs. 1980 lakhs to its
gross block of assets, 85% being in plant, machinery
and equipment. Assets with a written down value of
Rs. 226 lakhs was deleted during the period being
obsolete and unusable.
4.
Investments
With a view to earn a reasonable return on funds
surplus to its operational needs, the Company invests
its temporary surplus funds in units of debt-oriented
plans of mutual funds. Easy liquidity and safety of funds
are the prime consideration in selection of the funds
and plans. During the period, the Company has invested
and withdrawn Rs. 13122 lakhs of its short-term surplus
funds.
Closing investments as at 31st December, 2006
comprises of Rs. 3825 lakhs invested in Government
notified bonds to save Capital gain tax, Rs. 325 lakhs in
Company's wholly owned subsidiary viz. Chemtreat
Composites India Private Limited and Rs. 500 lakhs in
liquid plan of Mutual Fund.
2.
Loan Funds
Company has no long-term borrowings from financial
institutions or banks. The working capital requirement
5.
Current Assets, Loans and Advances
Current assets are those liquid assets, which are either
held in cash or can be converted into cash in a short
73
period. Among the important items included in Current
assets besides Cash and Bank balances are:
i. Inventories viz. raw/packing materials, work-inprogress, stores, and finished goods. The inventory
as on 31st December, 2006 represents 50 days of
average net sales as against 53 days as of the
previous year end.
ii. Receivables net of provision for doubtful debt viz.
money owned to the Company primarily by
customers. The period end receivables indicates
average credit period of 54 days as against 61 days
in the previous year.
iii. Loans & advances (mainly-tax paid in excess of
provisions, contractual deposits, prepaid expenses
and advances/loans to employees and third
parties).
During the period there is a decrease of 3% in total
current assets excluding Cash & Bank balances as
compared to the previous year.
world over. The Company deals in 3 major segments viz.
Intermediates and Colours, Dyes and Specialty
Chemicals, and Masterbatches contributing 37%, 60%
and 3% of Company's sales respectively.
9. Operating Profits
The operating profits are income before depreciation,
interest and taxes (EBDIT) and EBDIT is a standard
value used to analyse the ability of a Company to
generate cash from operations. The highly challenging
and competitive market environment continued its
pressures on the margin and the Company's operating
profit for the period is Rs. 6605 lakhs at 9.61% of the
sales.
6.
Current Liabilities
Current liabilities generally represent money the
Company owes to suppliers/vendors and others in
normal course of business. Sundry creditors include
amounts payable to vendors for supply of goods,
liabilities for excise, sales tax and other expenses.
Deposits include security deposits from distributors
and deposits from others for lease of buildings
and infrastructures. Unclaimed dividends represent
dividend paid, but not encashed by shareholders, and
are represented by a bank balance of equivalent
amount.
7.
Provisions
Provisions as at the period end consist of leave
encashment, gratuity and ex-gratia gratuity, proposed
dividend and corporate tax thereon. Liability for leave
encashment, gratuity and ex-gratia gratuity is valued on
actuarial basis. Proposed dividend represents the
dividend recommended by the Board of Directors
subject to approval of shareholders and will be paid
after the Annual General Meeting. Corporate tax on the
dividend declared is worked out at effective tax rate of
14.025% on the proposed dividend. Dividends received
by the shareholders will be exempt from tax.
10. Depreciation
Depreciation on fixed assets is calculated on straight
line method, at the rates and in the manner specified
under schedule XIV of the Companies Act, 1956 with a
few exceptions as stated in significant accounting
policies. Freehold land is not amortised or depreciated
while leasehold land is amortised over the period of
lease. The depreciation as a percentage of gross block
at the period end is 4% as compared to 6% for the
previous year.
Sales
Sales comprise of products sold by the Company in
domestic and export markets that are either
manufactured locally or purchased from various
indigenous and up-country sources. Sales are
recorded at net of trade discounts and inclusive of
excise duty wherever applicable. The ratio of domestic
sales to export sales during the year is 76:24. The export
sales are mainly to the affiliates of the Clariant group
11. Interest (net)
Interest income comprises of interest recovered from
debtors on delayed payments, interest on investments,
interest on bank deposits, income tax refunds and loans
to employees etc. Interest is paid on fixed term loan,
short-term bank borrowings and on security deposits
received from distributors. As the interest receipts are
higher than interest payments there is net surplus of
Rs. 7 lakhs.
8.
74
Financial and
Operational Analysis
12. Distribution of Revenue:
13. Profits before Taxation:
Profit before provision for Income tax generally
referred to as PBT reflects the profit earned by the
Company from operations and services before
provision for Income tax. The PBT for the period of
nine months in absolute terms is at Rs. 5077 lakhs and
7.39% of sales, marginally lower as compared to 7.57%
in the previous year.
14. Profits after Taxation:
Profit after tax commonly known as PAT is net earning
after considering the provision for tax liability viz.
Current tax, deferred tax and fringe benefit tax. It is the
Profit available for distribution of dividend to
shareholders and ploughing back in business for future
growth. Due to lower incidence of taxation, the PAT as
a percentage to sales for the nine months period is
slightly higher at 4.78% as against 4.72% in the previous
year.
15. Earning per Share (EPS):
This is, perhaps, the fundamental investor ratio
wherein, we work out the amount of profits earned per
equity share issued. A steady growth in EPS year after
year indicates a good track record of the Company’s
profitability. The EPS for nine months is 12.33 when
annualised is 16.44 i.e. an increase of 8.5% over the
previous years annualised EPS of 15.15.
16. Dividend per Share (DPS):
Whereas EPS shows what shareholders earned by way
of profit for a period, DPS shows how much of the profit
was actually distributed to the shareholders by the
Company as dividend. In view of consistency in
performance, the Board of Directors at their meeting
held on 22nd February, 2007 has proposed a dividend of
Rs. 18 (180%) per share including the ‘Golden Jubilee’
special dividend of Rs. 10 (100%) per share on face
value of Rs. 10/- each. The total incidence of dividend
and tax thereon for the current period is Rs. 5472 lakhs
as compared to Rs. 3344 lakhs for the previous financial
year, a quantum jump of 64%. The total payout on
account of dividend including tax thereon is 76% of
Profit available for appropriation as against 41% in the
previous year.
Note:
The figures for 2006 are for the period April 2006 to December 2006.
75
Financial Performance — 10 Years’ Highlights
(Rs. lakhs)
I.
II.
NINE
MONTHS
ENDED
DECEMBER
2006
***2006
2005
2004
2003
2002
2001
2000
1999
1998
GROSS TURNOVER
(including Excise duty)
75389.35
93270.02
41090.77
41826.63
39363.98
34215.62
34413.29
32765.37
33258.58
37286.26
GROSS SALES
75389.35
92465.33
40352.44
40833.91
38217.00
33100.62
33018.79
31438.49
31766.95
34883.13
NET SALES
68704.47
84791.46
36560.88
37467.75
34927.85
29901.01
29918.02
28178.52
28140.42
31227.12
GROSS EARNINGS
BEFORE DEPRECIATION
AND TAXATION
6612.36
8930.64
4724.99
3800.31
3437.44
2730.34
2368.18
4017.48
+4097.88
+3208.42
5077.50
6483.65
*3578.15
2495.16
2147.05
1415.73
1147.82
2815.02
#260.28
#5151.78
3286.32
4039.18
1558.67
3357.03
1496.64
905.53
897.82
2115.02
230.28
3826.78
EQUITY DIVIDENDS
4798.93
2932.68
699.00
699.00
699.00
582.50
466.00
757.25
757.25
1864.00
GROSS FIXED ASSETS
38317.99
38501.84
21055.78
19340.29
19738.26
19302.82
19126.81
18436.92
18188.03
17525.48
NET FIXED ASSETS
16518.52
16016.40
8372.27
7376.87
8047.40
8628.99
9349.69
9616.60
9935.32
10340.84
4650.58
11326.19
4645.27
2045.27
849.97
849.97
874.33
1877.63
877.63
877.63
11281.18
11986.69
7435.46
7415.48
8433.14
9821.10
10172.22
7887.98
8677.35
10186.34
2666.07
**2666.07
1165.00
1165.00
1165.00
1165.00
1165.00
1165.00
1165.00
1165.00
RESERVES
28358.24
30543.90
16057.44
15295.80
12727.33
12006.39
13038.76
12684.48
11423.61
12014.33
SHAREHOLDERS’ FUNDS
31024.31
33209.97
17222.44
16460.80
13892.33
13171.39
14203.76
13849.48
12588.61
13179.33
621.40
5593.67
3394.27
1104.37
2363.86
4739.76
6192.48
5532.73
6901.69
8225.48
32627.53
39329.28
20616.71
17565.17
17330.51
17911.15
20396.24
19382.21
19490.30
21404.81
OPERATING RESULTS
FINANCIAL PO
SITION
POSITION
INVESTMENTS
NET CURRENT ASSETS
EQUITY
LOANS AND DEFERRED
PAYMENT CREDITS
CAPITAL EMPLOYED
III.
#
+
@
*
FINANCIAL YEAR ENDED 31st MARCH
PER EQUITY SHARE @
EARNING
Rs.
12.33
(Not
Annualised)
15.15
13.38
28.82
12.96
7.97
7.45
180
21#
339#
DIVIDEND
Rs.
18
11
6
6
6
5
4
65
65
160
After exceptional items
Before exceptional items
Face value sub-divided to Rs. 10/- in October 2000
Before prior period items
** Including Share Capital suspense account
*** In view of the amalgamation w.e.f. April 1, 2005, the figures of the year 2006 are not directly comparable to those of earlier years.
76

Annual Report 2007-Cover

Transcription

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