|
Directors'
Report |
|
To
The Members,
Your Directors have
immense pleasure in presenting the
Nineteenth Annual Report and the audited
financial results of the Company for
the eighteen months period ended on
31st March 2006.
Financial Results/Highlights
Your Company has changed
its financial year from “October-September”
to “April-March” by extending its
current financial year comprising
18 months ended March 31, 2006. Accordingly,
the term “period under review” mentioned
in this report should be construed
as 18 months period starting from
October 1,2004 and ending on March
31,2006, unless otherwise specifically
indicated or the context provides
otherwise.
Further, the financial
figures of the period under review
comprises of the figures of erstwhile
FCGL Industries Ltd., which has been
mergedwith the Company as per the
Order passed by the Hon’ble High Court
at Calcutta dated 19th April, 2006,
with effect from the appointed date
i.e. 1st October, 2004. Hence, the
figures of the period under review
may not be comparable with those of
the previous year.
| |
(Rs.
in crores) |
| |
2004-2006
(18 months) |
2003-2004
(12 months) |
| Income
from operations |
408.77 |
133.41 |
| Less
: Interest |
12.81 |
1.59 |
| |
395.96 |
131.82 |
| Less
: Depreciation |
9.68 |
3.53 |
| Net
profit during the year |
386.28 |
128.29 |
| Less:
Provision for current tax / deferred
tax / fringe benefit tax |
74.29 |
37.51 |
| Profit
after tax |
311.99 |
90.78 |
| Add
: Balance brought forward |
25.69 |
7.96 |
| Amount
available for appropriation |
337.68 |
98.74 |
| Less:
Appropriations Transfer to General
Reserve |
150.00 |
60.00 |
| Interim
dividend |
38.97 |
12.17 |
| Proposed
dividend on equity shares |
6.00 |
4.72 |
| Corporate
tax on dividend |
6.30 |
2.28 |
| Debenture
redemption reserve |
12.5 |
– |
| Balance
carried to Balance Sheet |
123.92 |
19.57 |
| Earning
per share (Rs.) |
29.76 |
26.61 |
| Cash
Earning per share (Rs.) |
36.53
|
31.31 |
Review
of Operations
Net Sales grew from Rs. 285.21 crores
in 2003-04 to Rs. 553.74 crores in
period under review ending on March
31, 2006 and the bottomline exhibited
more than 129 % increase from Rs.
90.78 crores to Rs.311.99 crores during
the period under review on annualized
basis. The export of Met Coke has
increased from 20901 MT to 102191
MT during the period under review
after the company became the only
manufacturerexporter of met coke from
India in the previous year.
The improved performance was due to
a prudently-timed capacity expansion,
consolidation of presence, consistent
quality control and the reliability
of maintaining supply. Long-term agreements
with raw material suppliers and ship-owners
not only ensured regular supplies
leading to targeted production but
also helped de-risk the company from
significant cost variations.
Dividend
Your Directors are pleased to recommend
a final dividend of 5% in addition
to the three interim dividends aggregating
45% during the period under review.
This has aggregated to 50% dividend
for the period under review as against
a dividend of 40% paid in 2003-04.
With this final dividend, the amount
of total dividend paid by the company
during the period under review increased
to Rs. 44.96 crores as compared to
Rs. 16.89 crores paid in the previous
year. The bonus shares allotted during
the period under review are entitled
to a full dividend, irrespective of
their date of allotment, declared
thereafter.
Bonus
Issue
In attempt to continuously align its
paid-up capital with its growing scale
and also distribute profits judiciously,
your Company is prompting the issue
of bonus shares at periodic intervals.
The company had issued bonus shares
for the 3rd year in succession during
the month of February 2005. Further,
your directors are pleased to recommend
the fourth successive issue of bonus
shares in the ratio of one share for
every one share held.
Issue
of FCCB
The Company had issued Unsecured 1%
Foreign Currency Convertible Bonds
(FCCBs) due 2010 amounting to USD
55 million (including USD 5 million
under green-shoe option) in March
2005. In April 2006, the Company again
successfully issued another tranche
of Zero Coupon Unsecured FCCBs due
2011 amounting to USD 60 million (including
USD 10 million under green-shoe option)
for its various expansion programmes
in India as well as overseas.
Listing
The
equity shares of your Company are
listed on the National Stock Exchange
of India Limited (NSE), Bombay Stock
Exchange Limited (BSE) and The Calcutta
Stock Exchange Association Limited
(CSE). The FCCBs of the Company are
listed on the Luxembourg Stock Exchange
(LuxSE).
Merger
During the period under review the
Hon’ble High Court at Calcutta had
sanctioned the Scheme of Amalgamation
of FCGL Industries Limited, an associate
company with your Company vide its
Order dated April 19, 2006. FCGL Industries
Limited, was listed on BSE and CSE.
The entire assets & liabilities
of FCGL Industries Limited has been
taken over and merged with the Company
with effect from the appointed date
i.e October 1, 2004. Pursuant to the
aforesaid Scheme, the shareholders
of FCGL Industries Limited were allotted
1 (one) equity share of Rs. 10/- each
fully paid-up in the capital of the
Company for every 1 (one) equity share
of Rs. 10/- each fully paid-up held
by them in the merged entity.
Expansion
Your company has grown rapidly during
the last few years: it has gone for
backward integration i.e. coal mining
and has also diversified its business
activities from coke manufacturing
to steel manufacturing and generation
of wind-power.
Your
Company had, through its subsidiaries,
acquired two coal mines in Australia.
The first coal mine acquired by Gujarat
NRE Australia Pty Ltd. (GNAL) has
already started coal production. Till
date, three consignments consisting
of 0.14 million tonnes of coal have
already reached India. These coal
are being washed at the company’s
newly installed Coal Washery in Gujarat
which has also started commercial
operation. The operation of the second
coal mine acquired by another subsidiary
company Gujarat NRE FCGL Pty Ltd.
(GNFL) is expected to start during
the second half of 2007.
During
the period your company installed
21 Wind Turbine Generators aggregating
to the installed capacity of 26.25
MW green power generationtaking the
total capacity to 27.50 MW.
Your Company’s greenfield steel plant
in Kutch, Gujarat has commenced the
commercial production of TMT bars
and other rolled products.
Your
Company is in process of installing
another Greenfield coke plant at Dharwad,
Karnataka to cater to the South Indian
market and to take advantage of the
growing demand-supply gap of met coke
in the region.
Further, for economic use of the waste
heat emanating from the coke plants
and in tune with our eco-friendly
attitude, the company is also taking
necessary steps for co-generation
of power for captive consumption.
Subsidiaries
India’s manufacturing industry is
poised for spectacular growth during
the coming year(s). Correspondingly,
India’s coke demand is envisaged to
grow from 24.5 million tonnes to 60
million tonnes by 2011-12; while demand
for imported coking coal is expected
to grow to 71 million tonnes during
the same period.
In view of this imminent growth in
end product requirement, your Company
strengthened its access to raw material.
Your Company floated two Australian
subsidiary companies named as GNAL
& GNFL to acquire prime grade
hard coking coal mines near Sydney
in Australia (since renaming aforesaid
collieries as NRE No. 1 Colliery &
NRE Avondale Colliery respectively).
This
backward integration will secure the
availability of quality hard coking
coal across the long-term and, in
turn, help the Company to maintain
consistency in both quality and supply
of Met-Coke to all its regular &
new customers.
Further,
Zelos Resources NL has entered into
a heads of agreement with the Company
for acquisition of the above Avondale
Coal Project from your Company against
issue of shares & options in Zelos
to the Company, pursuant to which
your Company’s stake in Zelos will
increase from the present 19% to 85%
Further, subject to the approval of
shareholders of Zelos, this proposed
transaction if executed will result
in enhancing shareholder’s value for
both companies.
As
required under Section 212 of the
Companies Act, 1956, the Audited Accounts
of all the three subsidiary companies
including Indian subsidiary Bharat
NRE Coke Ltd. alongwith the Report
of Auditors and Directors thereon,
are attached to the audited accounts
of the company.
Further, the Consolidated Financial
Statements prepared by the Company
in accordance with Accounting Standard
21, which forms part of the Annual
Report, have taken into account the
financial information of its subsidiaries.
Recognitions
Your Company has been awarded the
status of ‘Two Star Export House’
by the Ministry of Commerce &
Industry of the Government of India.
Compliance
The Company has not defaulted in payment
of interest and/or repayment of loans
to any of the financial institutions
and /or banks.
Corporate
Governance
Your Company has taken adequate steps
to ensure that all mandatory provisions
of Corporate Governance, as provided
under the amended Clause 49 of the
Listing Agreement with the Stock Exchanges
with which the Company’s shares are
listed, are duly complied with.
A
separate report on Corporate Governance
along with auditors’ certificate for
its due compliance and Management’s
Discussion and Analysis are annexed
hereto and form a part of this Annual
Report.
Directors
Dr. Basudeb Sen and Shri Mahendra
Kumar Loyalka, Directors of the Company
retire by rotation at the forthcoming
Annual General Meeting and being eligible,
offer themselves for re-appointment.
Mr. Murari Sananguly was appointed
as an Additional Director of the Company
with effect from 29th December, 2005.
His appointment requires the approval
of the members at the ensuing Annual
General Meeting. Notice has been received
from a member of the Company under
Section 257 of the Companies Act,
1956 proposing his appointment as
Director.
Directors’
responsibility statement
Pursuant to the requirements under
Section 217(2AA) of the Companies
Act, 1956 with respect to Directors’
Responsibility Statement, it is hereby
confirmed that:
a)
in the preparation of annual accounts
for the extended financial year
for a period comprising of 18 months
period ended 31st March, 2006, the
applicable accounting standards
had been followed and that no material
departures have been made from the
same. As the appointed date of the
merged entity M/s FCGL IndustriesLtd.
with the Company was with effect
from 1st October, 2004, pursuant
to the Scheme of Amalgamation approved
by the Hon’ble High Court at Calcutta
vide its Order dated 19.04.2006
all the shareholders of the amalgamated
company became the shareholders
of the amalgamating company i.e.
Gujarat NRE Coke Ltd. with
effect from the record date for
this purpose i.e. 30th May, 2006.
The entire assets & liabilities
of the merged entity have been taken
over & merged with the figures
of the Company with effect from
the appointed date. Hence, the financial
figures of the period under review
are of the resultant consolidated
entity;
b) the Directors had selected
such accounting policies and practices
and applied them consistently and
made judgements and estimates that
are reasonable and prudent so as
to give a true and fair view of
the state of affairs of the Company
at the end of the period under review
and of the profit of the Company
for the period ended on that date;
c) the Directors have taken
proper and sufficient care for 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; and
d) the Directors had prepared
the annual accounts for the 18 months
period ended 31st March, 2006 on
a ‘going concern’ and on accrual
basis.
Auditors
M/s N. C. Banerjee & Co., Chartered
Accountants, retire as auditors of
the Company at the ensuing Annual
General Meeting and are eligible for
re-appointment. As required under
section 224 of the Companies Act,
1956, the Company has obtained a written
certificate from them to the effect
that their re-appointment as Auditors,
if made, would be in conformity with
the limits prescribed in the said
section.
Auditors’
report
The Report of the Auditors read with
the notes on the accounts, as annexed
are self-explanatory and needs no
elaboration.
Public
deposits
The Company has not accepted or renewed
any Public Deposits, as defined under
section 58A of the Companies Act,
1956, during the year.
Particulars
of conservation of energy, technology
absorption and foreign exchange earnings
and outgo
Particulars of conservation of energy,
technology absorption and foreign
exchange earnings and outgo as required
under section 217(1)(e) of the Companies
Act, 1956, read with the Companies
(Disclosure of Particulars in the
Report of the Board of Directors)
Rules, 1988 are given in the annexure
attached hereto and forms part of
this report.
Particulars
of Employees
Particulars of employees as required
under section 217(2A) of the Companies
Act, 1956 read with the Companies
(Particulars of Employees) Rules,
1975 as amended, are given in a separate
annexure attached hereto and form
part of this report.
Personnel
/ Industrial relations
During the period under review, your
Company maintained healthy, cordial
and harmonious industrial relations
at all levels. The enthusiasm and
unstinting efforts of the employee
have enabled your Company to remain
at the forefront of the industry.
Your Directors record their appreciation
for this hard work and efficiency.
Acknowledgements
Your Directors also wish to place
on record their appreciation and acknowledgement
of the support and co-operation extended
by the customers, suppliers, bankers,
financial institutions, investors,
media, Government and their agencies,
which translated into a record performance.
| |
For
and on behalf of the Board |
| |
|
sd/- |
| Place
: Kolkata, |
|
Girdharilal
Jagatramka |
Date : The 3rd Day of June,
2006
|
|
Chairman |
|
| |
Top
|
|
|
|
Information
as required under section 217(1)(e)
read with the Companies (Disclosure
of Particulars in the Report of Board
of Directors) Rules,
1988 and forming part of the Directors’
Report for the 18 months period ended
March 31, 2006
A. CONSERVATION
OF ENERGY
(a)
Energy Conservation measures taken
:
From one wind turbine generator
of 1.25 MW at Bhogat, serving
the coke plant at Khambalia, the
company nstalled 21 new wind turbine
generator aggregating 26.25 MW
to take care of the power requirements
at Bhachau’s coke and steel plant.
(b)
Additional investments and proposals
being implemented for reduction
of consumption of energy: The
Company has decided to set up
a co-generation power plant to
generate electricity from the
waste heat emanating from its
coke plants not only to reduce
the power cost but also to continue
its eco-friendly philosophy.
(c)
Impact of above measures at (a)
& (b) above for reduction
of energy consumption and consequent
impact of the cost of production
of goods :
More efficient utilisation of
power and reduction in energy
consumption.
(d)
Total energy consumption and energy
consumption per unit of Production
:
As per Form-A annexed
(e)
Efforts made in technology absorption
:
As per Form-B annexed.
C. FOREIGN EXCHANGE EARNINGS AND
OUTGO
(f)
Activities relating to export, initiatives
taken to increase exports; development
of new export markets for products
and services; and export plans :
The exports of the Company has increased
from Rs. 33.47 crores during the previous
year to Rs. 115.39 crores lacs during
the period under review due to rigorous
efforts being undertaken by the company
not only to increase its international
presence but also to tap new markets.
The Company is expanding its production
capacity to emerge as a leading coke
exporter. The company has received
the ISO 9001 : 2000 certification.
The company is the only exporter of
coke from the country. (g)
Total foreign exchange used and earned
:
XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX(Rs.
in crores)
| |
Amount |
| Total
Foreign exchange earning |
119.92 |
| Total
Foreign exchange outgo |
341.22 |
FORM
- A
Disclosure
of particulars with respect to Conservation
of Energy for the 18 months period
ended 31st March, 2006
|
|
|
Current
Period |
Previous
Year |
| A. |
Power
and Fuel Consumption |
|
|
| 1. |
Electricity |
|
|
| |
a)
Purchased : |
|
|
| |
—
Units (in Lacs)* |
84.32 |
19.47 |
| |
—
Total Amount (in Lacs) |
425.86 |
81.16 |
| |
—
Rate (Rs./Unit) |
5.05 |
4.17 |
| |
b)
Own generation through Diesel
Generator
|
|
|
| |
—
Units (in Lacs) |
1.93
|
1.30 |
| |
—
Units per Ltr. of Diesel Oil |
3.43 |
3.92 |
| |
—
Cost (Rs. / Units) |
9.51 |
6.45 |
| |
c)
Coal |
|
|
| |
—
Quantity (MT) |
NIL |
NIL |
| |
—
Total cost (Rs.) |
NIL |
NIL |
| |
—
Average rate (Rs./MT) |
NIL |
NIL |
| |
d)
Furnace Oil/HSD |
|
|
| |
—
Quantity (K.Ltr. in Lacs) |
8.30 |
NIL |
| |
—
Total cost (Rs.) |
288.75 |
NIL |
| |
—
Average rate (Rs./K.Ltr.) |
34.79 |
NIL |
| B. |
CONSUMPTION
PER UNIT OF PRODUCTION |
|
|
| |
Electricity
(Units / MT) |
14.63 |
8.23 |
| |
Coal
|
NIL |
NIL |
| |
Furnace
Oil/HSD |
1.44 |
NIL |
*
includes units through wind turbine
generators.
FORM
- B
Form for disclosure
of particulars with respect to technology
absorption
Research and Develpoment
(R&D)
1.XSpecific
areas in which R&D proposed to
be carried out by the company :
XXNone
2.XBenefits
derived as a result of above R&D
:
XX Not
Applicable.
3.XFuture
plan of action :
XXThe
Company is also planning to set up
a Power Plant by utilising the waste
heat emanating from the coke XXovens.
4.XEXPENDITURE
ON R&D : (Rs. in Lacs)
(a) CapitalXXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX:
NIL
(b) RecurringXXXXXXXXXXXXXXXXXXXXXXXXXXXXX:
NIL
(c) Total XXXXXXXXXXXXXXXXXXXXXXXXXXXXXXX:
NIL
(d) Total R&D Expenditure as a
Percentage of total turnoverX:N.A.
Technology
absorption, adaption and innovation
1.XXEfforts,
in brief made towards technology absorption.
adaptation & innovation :
XXXContinuous
efforts are being made towards improvements
in the existing production process.
2.XXBenefits
derived as a result of the above efforts
:
XXXThe
Company is successful in improving
and maintaining the quality of its
products.
3. XXParticulars
of technology imported during last
5 years :
XXX(a)
Technology import : NIL
XXX(b)
Year of import : N.A.
XXX(c)
Has technology been fully absorbed
: N.A.
XXX(d)
If not fully absorbed, areas where
this has not taken place, reasons
thereof and future plan of xxxxxxaction
: XXX
XXN.A.
Particulars
of Employees as required under section
217(2A) of the Companies Act, 1956,
read with companies (Particulars of
Employees) Rules, 1975 and forming
part of the Directors’ Report for
the 18 months period ended 31st march,
2006
Employed
throughout the year and was in receipt
of remuneration not less than 24 lacs
per financial year
|
Name |
Designation |
Gross
Remuneration (Rs.) |
Qualification
& Experience (years) |
Age
(years) |
Date
of Commencement of Employment |
Last
Employer & Designation held |
| Shri
A K Jagatramka |
Vice-Chairman
& Managing Director |
54,57,960/- |
B.Com
[Hons.], FCA |
44 |
28.03.1997 |
None |
Notes:
1) Remuneration includes salary, commission,
company’s contribution to provident
fund, gratuity and monetary value
of perquisites.
2) The appointment is contractual.
Other terms and conditions are as
per his agreement and as per the Rules
of the Company.
3) Shri A. K. Jagatramka is related
to Shri G. L. Jagatramka, Chairman
of the company.
| |
For
and on behalf of the Board |
| |
|
sd/- |
| Place
: Kolkata, |
|
Girdharilal
Jagatramka |
Date : The 3rd Day of June,
2006
|
|
Chairman |
|
Top |
|
Report
on Corporate Governance
|
|
1.
The Company’s Corporate Governance Philosophy
:
Gujarat NRE Coke Limited (Gujarat NRE)
defines Corporate Governance as a systematic
process by which companies are directed
and controlled keeping in mind the long-term
interest of the stakeholders. It firmly
believes that good Corporate Governance
is the foundation of corporate excellence.
It focuses on equitable treatment of all
shareholders and reinforces that it is “your company” and it belongs to you,
the shareholders.
Gujarat NRE is committed to good Corporate
Governance by creating an environment
based on entrepreneurship, professionalism
and pursuit for excellence. Its Corporate
Governance is based on two core principles:
* Management
must have executive freedom to drive the
enterprise forward without undue restraints:
and his freedom of management should be
exercised within a framework of effective
accountability.
The above belief and core principles of
Corporate Governance adopted by Gujarat
NRE leads the company’s governance philosophy,
trusteeship, transparency, independence,
fairness, accountability and social responsibility
which in turn is the basis of public confidence
in
the corporate system.
2. Board of Directors :
Composition and Category
The Board of Directors of the Company
consists of eminent persons with professional
expertise. As on 31st March, 2006 the
constitution of the Board was:
*
One Promoter, Non-Executive Director
* One Promoter,
Executive Director
* One Non-Executive
Director
* Four Independent,
Non-Executive Directors.
The composition of the Board of Directors
as on 31st March, 2006 and also the number
of other Board of Directors or Board Committees
of which he/she is a member/chairperson
are as under:
|
Name
of the Director |
Category |
No.
of other Directorships* |
No.
of other Board |
|
Committee**Member |
position
as
Chairman |
| Mr.
Girdharilal Jagatramka Chairman |
Promoter
Non-Executive |
4
# |
– |
– |
Mr.
Arun Kumar Jagatramka
Vice-Chairman & Managing Director
|
Promoter Executive |
5
# |
–
|
– |
Dr.
Mahendra Kumar Loyalka
|
Non-Executive
|
1
|
–
|
– |
| Mr.
Subodh Kumar Agarwal |
Independent
Non-Executive |
1
|
–
|
– |
Dr.
Basudeb Sen
|
Independent
Non-Executive |
6 |
2 |
1 |
Mr.
Chinubhai R Shah
|
Independent
Non-Executive |
10
|
5 |
4 |
| Mr.
Murari Sananguly (appointed on
29.12.2005) |
Independent
Non-Executive xecutive |
–
|
– |
–
|
*
Directorship in Foreign Companies, Private
Limited Companies and Companies covered
under section 25 of the Companies Act,
1956 have not been considered.
**
Only the positions held in Committees,
such as audit, remuneration and shareholders’
grievance committee in Indian Public
Limited Companies have been considered.
#
Excludes FCGL Industries Ltd., since
amalgamated with the Company.
‘Independent
Director’ means a non-executive director
who apart from receiving Director’s
remuneration does not have any other
material pecuniary relationship or transactions
with the Company, its promoters, its
management, or its subsidiaries, which
may have effect on the independence
of the director and who is not related
to promoters or persons occupying the
management position at the Board level
or one level below the Board, or in
the preceding 3 years has not been an
executive of the Company nor a partner
or executive of statutory audit firm
or internal audit firm or consulting
firm or legal firm that may have a material
association with the Company or is not
a substantial shareholder of the company
i.e. owning more than 2% of the block
of voting rights.
Meetings
and Attendance Record of Directors.
During the eighteen months period ended
on 31st March, 2006, 14 (fourteen) Board
Meetings were held on 11th October,
2004, 9th November 2004, 6th December
2004, 8th January 2005, 12th February
2005, 20th February 2005, 18th March
2005, 2nd April 2005, 25th April 2005,
30th April 2005, 13th July 2005, 29th
October 2005, 29th December 2005 and
24th January 2006.
The attendance of each Director at these
Board Meetings and the last Annual General
Meeting (AGM) was as follows:
|
Name
of the Directors |
No.
of Board Meetings held |
No.
of Board Meetings Attended * |
Attendance
at last AGM held on 08.01.2005 |
| Mr.
Girdharilal Jagatramka |
14 |
11 |
Yes |
| Mr.
Arun Kumar Jagatramka |
14 |
11 |
Yes |
| Dr.
Mahendra Kumar Loyalka |
14 |
4 |
Yes |
| Mr.
Subodh Kumar Agarwal |
14 |
12 |
Yes |
| Dr.
Basudeb Sen |
14 |
8 |
Yes |
| Mr.
Chinubhai R Shah |
14 |
10 |
Yes |
Mr.
Murari Sananguly
(appointed on 29.12.2005) |
1 |
1 |
N A |
* Includes participation through tele-conference
All
the Directors hold directorship/committee
membership in other Companies within
the limits prescribed in this regard.
Board
Procedures
The
Board of Directors of the Company meets
from time to time to transact business
in respect of which the Board’s attention
is considered necessary. The Company
is governed by the Vice Chairman
& Managing Director under the
supervision and control of the Board
of Directors.
There is a well-laid procedure to send
detailed Agenda papers to the Directors
before such meetings. The Directors
express their views freely and seek
clarifications on various items of business
taken up at such meetings. The discussions
are held in a transparent manner. Various
decisions emanating from such meetings
are implemented to streamline the systems
and procedures followed by the Company.
The information regularly supplied to
the Board inter-alia includes the following
:
*
Annual operating plans and budgets,
Capital budgets, updates, and all variances.
* Quarterly & annual results for the
company and its operating divisions
or business segments.
*
Minutes of meetings of audit committee
and other committees of the Board.
*
Information on recruitment and remuneration
of key executives below the Board level.
*
Significant regulatory matters concerning
Indian or Foreign regulatory authorities.
*
Issues that involves possible public
or product liability claims of substantial
nature.
*
Details of any joint venture or collaboration
agreement.
*
Risk analysis of various products, markets
and business.
*
Transactions that involve substantial
payment towards goodwill, brand equity,
or intellectual xxproperty.
*
Significant labour problems and their
proposed solutions.
*
Significant development in Human Resources
and Industrial Relations fronts.
*
Quarterly details of foreign exchange
exposures and the steps taken by management
to limit the xxrisks
of adverse exchange rate movement, if
material.
*
Significant Sale of investments, subsidiaries,
assets, which is not in normal course
of business.
*
Contracts in which Directors are deemed
to be interested.
*
Material Show cause, demand, prosecution
and penalty notices.
*
Fatal or serious accidents, dangerous
occurrences.
*
Material effluent or pollution problems.
*
Material default in financial obligations
to and by the company, or substantial
non-payment for goods xxsold
by the company.
*
Non-compliance of any regulatory, statutory
or listing requirements and shareholders
service such xxas
non-payment of dividend, delay in share
transfer etc.
There
has been no significant related party
transactions or pecuniary relationships
between the Company and its directors,
management, subsidiary or relatives
except for those disclosed in the financial
statements for the 18 months period
ended 31st March, 2006.
3.
Board Committees :
(a)
Audit Committee :
i)
Terms of Reference : The terms
of reference of the Audit Committee
are in conformity with the requirements
of Clause 49 of the Listing Agreement
and Section 292A of the Companies
Act, 1956. These broadly cover the
following:
1) To oversee the Company’s financial
reporting process and the disclosure
of its financial information to ensure
that the financial statements are
correct, sufficient and credible.
2) To review and recommend to the
Board about the appointment, re-appointment
and if required the replacement or
removal of statutory auditors and
fixation of their fees.
3) To review with the management,
the financial statements before submission
to the Board, focusing primarily on
Management Discussion and Analysis,
Director’s Responsibility Statement
which forms part of the Director’s
Report, accounting policies, compliance
with accounting standards, compliance
with Stock Exchange and legal requirements
and any related party transactions
etc.
4) To review with the management,
external and internal auditors, the
adequacy of internal control systems
& internal audit reports, if any,
on internal control weaknesses.
5) To discuss with the Auditors on
the scope and nature of Audit and
also to have Post Audit discussion
to ascertain any area of concern.
6) To review the Company’s financial
and risk management policies.
7) Review the financial statements,
in particular, the investment made
by the unlisted subsidiary company,
all significant transactions entered
into by the subsidiary company.
8) Review of the minutes of the Board
meetings of the unlisted subsidiary
company alongwith a statement of significant
transactions and arrangements entered
into by the unlisted subsidiary company.
9) A statement of material related
party transactions, if any.
10) To undertake such other matters
as may be delegated by the Board from
time to time.
ii)
Composition :
The present composition of the Audit
Committee is as follows :
Mr. Subodh Kumar Agarwal (Chairman)
Mr. Girdharilal Jagatramka
Dr. Basudeb Sen
Mr. Chinubhai R ShahAll
the members of the Committee are Non–Executive
Directors. Mr. Subodh Kumar Agarwal,
an Independent Director is a
qualified Chartered Accountant and Dr.
Basudeb Sen and Mr. Chinubhai R. Shah
who has executive experience in financial
institutions, are Independent Directors.
Mr. Chinubhai R. Shah was inducted into
the Committee on 24th January 2006.
The
Company Secretary acts as the Secretary
to the Committee.
iii)
Meetings and Attendance
During the eighteen months period
ended on 31st March, 2006, six meetings
were held on the 09.11.04, 08.01.05,
25.04.05,
13.07.05, 29.10.05 and 23.01.06.
The attendance of the Audit Committee
Members is as follows:
|
Name(s) |
Held
* |
Attended |
| Mr
Girdharilal Jagatramka |
06 |
05 |
| Mr.
Subodh Kumar Agarwal |
06 |
06 |
| Dr.
Basudeb Sen |
06 |
05 |
| Mr
Chinubhai R. Shah |
NA |
NA |
*
Indicates the number of meetings held
only during the period of membership.
The
Statutory Auditors and the Internal
Auditors also attends the meeting whenever
required. The Vice Chairman & Managing
Director, the Chief Financial Officer
(CFO) and other senior executives are
also invited to attend and deliberate
in the meetings. Minutes of the Audit
Committee are also placed before the
Board & discussed.
(b)
Share Transfer Committee :
The Company has constituted a Share
Transfer Committee with Mr. Girdharilal
Jagatramka (Chairman), Mr. Subodh Kumar
Agarwal and Dr. Mahendra Kumar Loyalka
as its members which meets at regular
intervals as per the requirements to
approve transfers, transmissions, and
issue of duplicate share certificates,
etc.
(c)
Shareholders’/Investors’ Grievance committee
:
The Committee, at present, consists of
the following members:
i.
Mr Girdharilal Jagatramka (Chairman)
ii. Mr. Subodh Kumar Agarwal
iii. Dr. Mahendra Kumar Loyalka
The
Committee looks into the redressal of
shareholders’ and investors’ complaints
like transfer of shares, non–receipt
of balance sheet, non-receipt of declared
dividends etc. The Committee met 6 times
during the period under review. The
Company Secretary has been designated
as the Compliance Officer by the Board
and assigned with the responsibilities
of overseeing shareholders’/investors’
grievances under the supervision of
the Committee. During the period, 128
complaints were received from the investors
and as on 31st March, 2006, there was
one pending complaint which has since
been resolved.
(d)
Remuneration Committee :
The Company has formed a Remuneration
Committee. The terms of reference is to
consider and approve the remuneration
payable to the managerial person including
Managing Director / Wholetime Directors
of the Company as prescribed under the
Companies Act, 1956 or rules made thereunder.
It is aimed at attracting and retaining
high caliber talent. The Company does
not currently have a stock option plan
or performance-linked incentives for its
Directors. This Committee comprises of
Mr. Subodh Kumar Agarwal, Chairman, Mr.
Arun Kumar Jagatramka, Dr. Mahendra Kumar
Loyalka, Dr. Basudeb Sen and Mr. Murari
Sananguly as its members which meets at
regular intervals as per the requirements.
The Company is committed to make full
disclosures regarding payment to all directors.
The Company pays only sitting fees to
the non-executive directors.
Details of payments made to the Vice-Chairman
and Managing Director during the year
under review is given below :
|
Name
of the Directors |
Salary(Rs.) |
Perquisites(Rs.) |
Contribution
to PF (Rs.) |
Total
(Rs.) |
Service
Contract/ Notice Period/ Severance
Fees |
| Mr.
Arun Kumar Jagatramka |
45,00,000/- |
4,17,960/-
|
5,40,000/- |
54,57,960/- |
Service
Contract |
Details of sitting fees paid to the non-executive
directors during the 18 months period
ended 31st March, 2006 along with shares/convertible
instruments held by non-executive directors
is as follow :
|
Name
of the Directors |
Shares/
Convertible Instruments held |
Sitting
Fees Paid * (Rs.) |
Service Contract/ Notice Period/Severance
Fees
|
| Mr.
Girdharilal Jagatramka |
2,30,220 |
2,10,000/- |
Retire by Rotation |
| Mr.
Subodh Kumar Agarwal |
1,070
|
2,38,000/-
|
Retire
by Rotation |
| Dr.
Basudeb Sen |
– |
1,04,000/-
|
Retire
by Rotation |
| Mr.
Chinubhai R. Shah |
7,500 |
1,00,000/- |
Retire
by Rotation |
| Dr.
Mahendra Kumar Loyalka |
10,350 |
48,000/- |
Retire
by Rotation |
| Mr.
Murari Sananguly |
–-
|
10,000/- |
Retire
by Rotation |
*
also includes sitting fees paid for attending
any meeting of the committee of the Board.
Code
of Conduct
The Company has already adopted a Code
of Conduct which was made applicable
to all its Directors, whether executive
or non-executive and all Senior Management
Personnel of the Company. All Board
members and senior management personnel
have affirmed compliance with the Company’s
code of conduct during the period. A
declaration to this effect that all
Board members and senior management
personnel have complied with the Company’s
code of conduct during the period under
review (since its adoption) and duly
signed by the Vice-
Chairman & Managing Director and
CFO of the Company is annexed and forms
part of this Report. The aforesaid Code
of Conduct has been posted on the website
of the company.
Risk Management The company has laid
down procedures to inform Board of Directors
about the risk assessment and minimisation
procedures.
4.
General Body Meetings :
a)
The details of last 3 Annual
General Meetings :
|
Financial
Year Ended |
Meeting |
Location |
Date |
Time |
Special
Resolution, if any |
|
30.09.2004
|
18th
AGM |
Rotary Sadan, 94/2, Chowringhee
Road
Kolkata – 700 020 |
08.01.2005
|
11:30
AM |
Yes |
|
30.09.2003
|
17th
AGM |
Gyan
Manch, 11, Pretoria Street
Kolkata – 700071 |
29.03.2004 |
10:30
AM |
Yes |
|
30.09.2002 |
16th
AGM |
Somany
Conference Hall, 15B, Hemant
Basu Sarani
Kolkata - 700001 |
09.04.2003
|
11:30
AM |
Yes |
b) Postal Ballot :
Special Resolutions put through postal
ballot last year : Nil
Items proposed to be conducted through
postal ballot this year : Nil
5. Disclosures :
a)
Disclosures on materially significant
related party transactions: The Company
has not entered into any transactions
of material nature, with its Promoters,
Directors or the Management, its subsidiaries
or relatives etc. that may have potential
conflict with the interest of the Company
at large, other than in the normal course
of business. The transactions undertaken
during the year have been disclosed
in Note No. 12 of Schedule 17 forming
part of the Accounts for the eighteen
months period ended 31st March, 2006.
b) The Company is regular in
complying with the requirements of the
regulatory authorities on the matters
relating to the Capital market and no
penalties/strictures have been imposed
on the Company by Stock Exchange or
SEBI or any statutory authority, during
the last three years.
c) FCGL Industries Ltd., an associate
company, has been merged with the Company
effective from 1st October, 2004 (the
appointed date) in pursuance of a scheme
of amalgamation approved by the order
of Hon’ble High Court at Calcutta dated
19th April, 2006.
d) The Company duly complies
with all the mandatory requirements
of Clause 49 of the Listing Agreement
with the Stock Exchange.
However, the Company has not adopted
the non-mandatory requirements defined
therein.
6.
Means of Communication :
a)
Quarterly results and the half yearly
results are published in leading newspapers
such as Business Standard (English),
The Financial Express (English), The
Times of India (English), The Economic
Times (English), Asian Age (English)
and Dainik Lipi (Bengali).
b) The quarterly, half yearly
and yearly financial results of the
Company are sent to the Stock Exchange(s)
at which the Company’s shares are
listed immediately after the Board
approves them.
c) Copies of the financial
results and Annual Reports of the
Company are provided to various Analysts,
Government Departments, Investors
and others interested in getting the
same upon receipt of requests from
them.
d) The Management Discussion
and Analysis forms a part of this
Annual Report.
e) The Quarterly Results of
the Company are displayed in the company’s
website : www.gujaratnre.com
7.
General Shareholders’ Information :
| a)
Annual General Meeting : |
|
Date
and Time :
|
3rd
July, 2006 at 10.00 A.M. |
Venue
:
|
Gyan
Manch, 11, Pretoria Street, Kolkata
- 700071 |
| b)
Financial Year : |
18
month extended period from 1st
October, 2004 to 31st March, 2006 |
| c)
Book Closure Date : |
30th
June, 2006 to 3rd July, 2006 (Both
days inclusive) |
| d)
Dividend Payment Date : |
On
or before 30 days from the date
of Annual General Meeting |
| e)
Listing of Equity Shares on Stock
Exchanges at : |
(i)
The Calcutta Stock Exchange Association
Ltd.
7, Lyons Range, Kolkata - 700001 |
| |
(ii)
Bombay Stock Exchange Ltd., P
J Towers, Dalal Street, Fort,
Mumbai – 400001 |
| |
(iii)
The National Stock Exchange of
India Ltd.
Exchange Plaza, Bandra Kurla Complex
Bandra (E), Mumbai - 400051 |
| f)
Listing Fees : |
Annual
Listing Fees for the year 2006-2007
has been paid to the above Stock
Exchanges. The Company has also
paid the Annual Custodian Fees
to both the Depositories. |
| g)
Depositories : |
(i)
National Securities Depository
Ltd., Trade World, Kamala Mills
Compound, Lower Parel, Mumbai
- 400003 |
| |
(ii)
Central Depository Services (India)
Ltd., P J Towers, 28th Floor,
Dalal Street, Fort, Mumbai – 400001 |
| h)
Stock Code : |
Stock
Exchange(s) |
Stock
Code |
| |
The
Calcutta Stock Exchange Association
Ltd. |
17043 |
| |
Bombay
Stock Exchange Ltd. |
512579 |
| |
The
National Stock Exchange of India
Ltd. |
GUJNRECOKE |
| |
ISIN
of equity shares (on both the
depositories) |
INE110D01013 |
i) Market Price Data :
The Market Price of the Equity Shares
of the Company during 2004–2006 is given
in the table below :
|
Months
|
CSE |
BSE |
NSE |
|
High
|
Low
|
High |
Low |
High |
Low |
| October,
2004 |
90.40 |
86.00 |
116.50 |
77.00 |
116.40 |
86.40 |
| November,
2004 |
– |
–
|
128.90 |
107.65 |
128.45
|
108.00 |
| December,
2004 |
– |
– |
193.00 |
122.15 |
192.70
|
122.15 |
| January,
2005 |
–
|
–
|
195.10 |
159.60 |
195.30 |
159.55 |
| February,
2005 |
– |
– |
236.70
|
116.25 |
236.50 |
112.30 |
| March,
2005 |
– |
– |
171.00 |
113.00 |
171.00 |
113.65 |
| April,
2005 |
– |
–
|
139.75 |
106.30 |
139.85 |
102.20 |
| May,
2005 |
– |
– |
118.80 |
102.00
|
118.75 |
102.00 |
| June,
2005 |
– |
–
|
129.00 |
104.00 |
126.25 |
104.80 |
| July,
2005 |
–
|
– |
135.25 |
115.00 |
132.05 |
117.20 |
| August,
2005 |
– |
– |
149.95 |
118.90 |
149.40 |
118.55 |
| September,
2005 |
– |
– |
170.00
|
124.10
|
169.50
|
129.05 |
| October,
2005 |
–
|
– |
140.75 |
99.10 |
141.00 |
99.10 |
| November,
2005 |
– |
– |
119.90 |
105.25 |
120.00 |
105.80 |
| December,
2005 |
– |
– |
114.90 |
102.10 |
115.00 |
102.50 |
| January,
2006 |
– |
– |
107.50 |
89.90
|
107.90 |
90.00 |
| February,
2006 |
– |
–
|
94.95 |
80.80
|
95.00 |
81.00 |
| March,
2006 |
– |
– |
104.00 |
85.60 |
105.50 |
85.55 |
*
Data relating to BSE & NSE has been
taken from their respective websites.
j )
Share Price Performance :
|
Financial
Year |
%
Change in Gujarat NRE’s Share
Price |
%
Change in BSE Sensex |
|
2004-2006 |
150.06* |
101.90 |
*
after adjustment of bonus in the ratio
of 1:1 during February, 2005.
k)
Registrar and Share Transfer Agents
:
Niche Technologies Private Limited
D-511, Bagri Market, 71, B. R. B.
Basu Road, Kolkata-700 001
Phones : +91-33-22357271/7270 • Fax
: +91-33-22156823
E-Mail : nichetechpl@ nichetechpl.com
l)
Share Transfer System :
Applications for transfer of shares
held in physical form are received
at the office of the Registrar &
Share Transfer Agents. The Committee
of Directors attend to Share transfer
formalities at least once in every
month depending upon the requirements.
Shares held in dematerialised form
are traded electronically in the Depository.
The RTA of the Company periodically
receives from the Depository, the
beneficial holding so as to enable
them to update their records and to
send all corporate communications
and Dividend Warrants etc. to the
beneficial owners of shares. Physical
shares received for dematerialisation
are processed and dispatched within
a period of fifteen days from the
date of receipt, provided they are
found in order in every respect. Bad
deliveries are immediately returned
to the respective Depository Participant
under advice to the Shareholders.
m)
Shareholding Pattern as on 31st March,
2006 :
|
Category |
No.
of Shares |
%
of Holding |
| Promoters
& Persons Acting in Concert |
4,62,36,490 |
46.58 |
Financial
Institutions, Banks, Mutual Funds,
etc.
|
43,05,939
|
4.34 |
| FIIs
|
58,12,657
|
5.85 |
| Indian
Public (incl. Private Corporate
Bodies) |
4,12,06,453 |
41.51 |
| NRIs |
8,34,629 |
0.84 |
| Clearing
Members |
8,72,648 |
0.88 |
|
Total
|
9,92,68,816 |
100.00 |
n)
Distribution of Shareholding as on
31st March, 2006 :
|
Shareholding
Range |
No.
of Shareholders |
%
of Shareholders |
No.
of Shares Held |
%
of Shareholding |
| 1
– 500 |
52,224 |
83.79 |
84,83,313
|
8.55 |
| 501
– 1000 |
5,413 |
8.68 |
44,07,093 |
4.44 |
| 1001
– 5000 |
3,934 |
6.31 |
87,16,743 |
8.78 |
| 5001
– 10000 |
395 |
0.63 |
29,27,825 |
2.95 |
| 10001
– 50000 |
279 |
0.45 |
56,33,088 |
5.68 |
| 50001
– 100000 |
36 |
0.06 |
25,97,930 |
2.62 |
| 100001
– and above |
50 |
0.08 |
6,65,02,824 |
67.00 |
|
Total |
62,331 |
100.00 |
9,92,68,816 |
100.00 |
o) Dematerialisation of Shares
and Liquidity :
Approximately 81% of the Shares have
been dematerialised as on 31st March,
2006. The Equity Shares of Company
are actively traded in Stock Exchanges
and are permitted to be traded only
in dematerialised form w.e.f. 26th
March, 2001.
p)
Outstanding GDRs/ADRs/Warrants or any
Convertible instruments, Conversion
date and likely impact on equity :
The outstanding warrants and convertible
bonds as on date are as under :
•
2,200 Nos. of 1% Unsecured FCCB due
2010 having issue value of US$ 25,000
each. If all the bonds are converted
into equity shares, then the Share Capital
of the Company will increase by around
12,988,918 Equity shares of Rs. 10/-
each.
•
600 Nos. of Zero Coupon Unsecured FCCB
due 2011 having issue value of US$ 1,00,000
each. If all the bonds are converted
into equity shares, then the Share Capital
of the Company will increase by around
21,436,800 Equity shares of Rs. 10/-
each.
•
14,050,000 share warrants convertible
into equivalent number of shares.
q) Plant Location :
•
Coke Plant
1. Vill. : Dharampur, P.O. Khambhalia,
Dist.: Jamnagar, Gujarat, Pin : 361305
2. Vill. : Lunva, Taluka-Bhachau,
Dist : Kutch, Gujarat, Pin. : 370140
•
Steel Plant
Vill. : Lunva, Taluka-Bhachau, Dist
: Kutch, Gujarat, Pin. : 370140
r)
Address of Subsidiaries :
•
Gujarat NRE Australia Pty Ltd.
NRE No. 1 Colliery, Princess Highway,
Cnr Bellambi Lane, Russell Vale 2517
NSW, Australia.
•
Gujarat NRE FCGL Pty Ltd.
NRE No. 1 Colliery, Princess Highway,
Cnr Bellambi Lane, Russell Vale 2517
NSW, Australia.
•
Bharat NRE Coke Ltd.
22, Camac Street, Block ‘C’, 5th Floor,
Kolkata-700 016, India.
s)
Address for Correspondence :
Block – C, 5th Floor, 22, Camac Street,
Kolkata-700 016
Phone: +91-33-22891471-75, Fax: +91-33-22891470,
E-mail: kolkata@gujaratnre.com
| |
For
and on behalf of the Board |
| |
|
sd/- |
| Place
: Kolkata, |
|
Girdharilal
Jagatramka |
Date : The 3rd Day of June,
2006
|
|
Chairman |
|
Top |
|
|
|
To the
Members of
Gujarat NRE Coke Limited
We have
examined the compliance of conditions of
Corporate Governance by Gujarat NRE Coke
Limited for the eighteen months period ended
on 31st March, 2006, as stipulated in Clause
49 of the Listing Agreement of the said
Company with the Stock Exchanges.
The compliances
of the conditions of the 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 the Corporate Governance.
It is neither an audit nor an expression
of the 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 the
representation made by the Directors and
the Management, we certify that the Company
has complied with the conditions of Corporate
Governance as stipulated in the above-mentioned
Listing Agreement.
As required
by the guidance note issued by the Institute
of Chartered Accountants of India, we have
to state that as per the records maintained,
there were no investors’ complaints remaining
unattended/pending for more than 30 days
as at 31st March, 2006.
We further
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
N. C. Banerjee & Co. |
| |
|
sd/- |
| |
|
Chartered
Accountants |
| Place
: Kolkata, |
|
B.
Basu |
Date : The 3rd Day of June, 2006
|
|
Membership
No. 12748 |
|
Top
|
|
We
A. K. Jagatramka, Vice-Chairman &
Managing Director and Manish Lohia,
Chief Financial Officer of Gujarat NRE Coke
Limited, to the best of our knowledge and
belief, certify that :
1) We have reviewed the balance sheet as
at 31st March, 2006 and profit & loss
account, and all its schedules and notes
on accounts, as well as the cash flow
statements and the director’s report for
the 18 months period ended on that date.
2)
Based on our knowledge and information,
these statements do not contain any untrue
statement of a material fact or omit to
state a material fact or does not contain
any statement that might be misleading;
3)
Based on our knowledge and information,
the financial statements, and other financial
information included in this report, present
in all material respects, a true and fair
view of the company’s affairs, the financial
condition, results of operations and cash
flows of the Company as of, and for, the
periods presented in this report and are
in compliance with the existing accounting
standards and/or applicable laws and regulations;
4)
To the best of our knowledge and belief,
no transactions entered into by the company
during the aforesaid period are fraudulent,
illegal or violative of the company’s
code of conduct.
5)
We are responsible for establishing and
maintaining disclosure controls and procedures
and internal controls over financial reporting
for the company, and we have
i. evaluated the effectiveness of the company’s
disclosure, controls and procedures
over financial reporting; and
ii. disclosed in this report any change
in company’s internal control over financial
reporting that occurred during the company’s
most recent accounting period that may
have materially affected, or is reasonably
likely to affect, the company’s internal
control over financial reporting.
6)
We have disclosed based on our most recent
evaluation, wherever applicable, to the
company’s auditors and the audit committee
of the company’s Board of Directors
i.
All deficiencies in the design or operation
of internal controls, which could adversely
affect the company’s ability to record,
process, summarize and report financial
data and have identified for the company’s
auditors, any material weakness in internal
control over financial reporting including
any corrective actions with regard to
such deficiencies, if any;
ii. Significant changes in internal
controls during the period covered by
this report, if any;
iii. All significant changes in accounting
policies during the period, if any and
that the same have been disclosed in
the notes to the financial statements.
iv. No instances of significant fraud
of which we are aware, involving management
or other employees who have significant
role in the company’s internal controls
system
7)
We further declare that all board members
and senior management personnel have affirmed
compliance with the code of conduct (since
its adoption) during the period under
review.
xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxsd/-xxxxxxxxxxxxxxxxxxxxxxxxxxxxxsd/-
Place
: KolkataxxxxxxxxxxxxxxxxxxxxManish
LohiaxxxxxxxxxxxxxxxxA.
K. Jagatramka
Date : 3rd June, 2006xxxxxxxxxxxxChief
Financial OfficerxxxxxVice
Chairman & Managing Director
|
Top |
|
|
-
We have audited the
attached Balance Sheet of Gujarat
NRE Coke Limited (“the Company”) as
at March 31, 2006 and the Profit and
Loss Account and the Cash Flow Statement
of the Company for the period comprising
of 18 months ended on that date. 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 management, as well as evaluating
the overall financial statement presentation.
We believe that our audit provides
a reasonable basis for our opinion.
-
As required by the
Companies (Auditor’s Report) Order,
2003 as amended by the Companies (Auditor’s
Report) (Amendment) Order, 2004, 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 hereto a statement
on the matters specified in paragraphs
4 and 5 of the said Order to the extent
applicable.
-
Further
to our comments in the Annexure referred
to in paragraph 3 above, we report that:
(a) We have obtained all the
information and explanations, which
to the best of our 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 those books;
(c) The Balance Sheet, Profit
and Loss Account and the 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
(AS) referred to in subsection (3C)
of section 211 of the Companies Act,
1956 to the extent applicable;
(e) On the basis of written representations
received from the directors as on 31st
March, 2006, and taken on record by
the Board of Directors, we report that
none of the directors
are disqualified as at March 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; and
(f) 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 :
(i) in
the case of the Balance Sheet,
of the state of affairs of the
Company as at March 31, 2006;
(ii) in the case of the
Profit and Loss Account, of the
profit for the period comprising
of 18 months ended on that date;
and
(iii) in the case of Cash
Flow Statement, of the cash flows
for the period comprising of 18
months ended on that date.
| |
For
N. C. Banerjee & Co. |
| |
|
sd/- |
| |
|
Chartered
Accountants |
| Place
: Kolkata, |
|
B.
Basu |
Date : The 3rd Day of June, 2006
|
|
Membership
No. 12748 |
|
Top |
|
|
| (i) |
(a) |
The
Company has maintained proper records
showing full particulars, including
quantitative details and situation
of fixed assets. |
(viii) |
|
The
Central Government has not prescribed
rule for maintenance
of cost records under Section 209(1)(d)
of the Companies Act, 1956 for Low-ash
Metallurgical coke business. However,
cost records are being maintained
for steel business as per rules. |
| |
(b) |
The
Company has a phased programme of
physical verification of its fixed
assets which, in our opinion, is reasonable
having regard to the size of the Company
and the nature of its assets. In accordance
with this programme, fixed assets
required to be verified as part of
this programme were physically verified
by management during the period under
review and no material discrepancies
were identified
on such verification. |
(ix) |
(a) |
According
to the information and explanations
given to us and on the basis of our
examination of the books of
account, in our opinion, the Company
has been generally regular in depositing
undisputed statutory dues including
Provident Fund, Investor Education
and Protection Fund, Employees’ State
Insurance, Income Tax, Sales Tax,
Wealth
Tax, Service Tax, Customs Duty, Excise
Duty, Cess and any other material
statutory dues during the period under
review with the appropriate authorities.
Since the Central Government has till
date, not prescribed the amount of
cess payable under section 441 A of
the
Companies act,. 1956, we are not in
a position to comment upon the regularity
or otherwise of the company in depositing
of the same. |
| |
(C) |
Fixed assets disposed off during the
period under review were not substantial
and therefore do not affect the going
concern assumption. |
|
(b) |
According
to the information and explanations
given to us, no undisputed amount
payable in respect of Income
Tax, Sales Tax, wealth Tax, Service
Tax, Custom duty and Excise duty were
in arrear as at 31st March, 2006 for
a
period of more than six months from
the date they became payable. |
| (ii) |
(a) |
The
inventories have been physically verified
by the management at reasonable intervals
during the period. In our opinion,
the frequency of verification is reasonable. |
|
(c) |
According
to the information and explanations
given to us there are no dues in respect
of Income Tax, Sales Tax,
Wealth Tax, Service Tax, Customs Duty,
Excise Duty and Cess that have not
been deposited with the appropriate
authorities on account of any dispute
other than those as mentioned here-in-below:
|
Name
of the Statue |
Nature
of Dues |
Amount
(Rs./lacs) |
Period
to whichamount relates (Asst.
Year) |
Forum
where
the dispute is
pending |
|
Income Tax Act,1961 |
Regular
Assessment |
113.77
|
2003-04 |
CIT
(Appeals) |
|
-do- |
-do-
|
10.21 |
2003-04
|
CIT
(Appeals) |
|
| |
(b) |
In
our opinion, 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. |
(x) |
|
The
Company does not have accumulated
losses at the end of the period ended
31st March, 2006 and has not incurred
cash
losses in during the period under
review and in the immediately preceding
financial year. |
| |
(c) |
The
Company is maintaining proper records
of inventory. The discrepancies noticed
during the physical verification of
inventories as compared to book records
were not
material and have been properly dealt
with in the books of account. |
(xi) |
|
In our opinion and according to the
information and explanations given
to us, the Company has not defaulted
in repayment of dues to its banks
or to any financial institutions or
debenture holders. |
| (iii) |
(a) |
The
company has granted unsecured loans
amounting to Rs.2406.06 lacs to its
two subsidiary companies. |
(xii) |
|
The Company has not granted loans
and advances on the basis of security
by way of pledge of shares, debentures
and other
securities. |
| |
(b) |
The
rate of interest and other terms and
conditions on which the said loan
was given are not, prima-facie, prejudicial
to the interest of the company. |
(xiii) |
|
In
our opinion and according to the information
and explanations given to us, the
Company is not a chit fund / nidhi
/ mutual benefit fund / society. |
| |
(c) |
The said subsidiary companies are
regular in repayment of interests.
The principal amount of loan is repayable
on demand |
(xiv) |
|
According
to the information and explanations
given to us, the Company is not dealing
or trading in shares, securities,
debentures and other investments. |
| |
(d) |
There
is no overdue amount in excess of
Rs. 1 lac in respect of loans granted
to companies, firms or other parties
listed in the register maintained
under Section 301 of the Companies
Act, 1956. |
(xv) |
|
In our opinion and according to the
information and explanations
given to us, the terms and conditions
on which the Company has given guarantees
for loans taken by the subsidiaries
companies from banks or financial
institutions are not prejudicial to
the
interests of the Company. |
| |
(e) |
The
company has not taken any loan from
the companies covered in the Register
maintained under section 301 of the
Companies Act, 1956, hence clause
iii (f) and iii (g) of this order
is not applicable. |
(xvi) |
|
In
our opinion and according to the information
and explanations given to us and on
the basis of our examination of the
books of account, the term loans obtained
by the Company were applied for the
purpose for which such loans were
obtained. |
| (iv) |
|
In
our opinion and according to the information
and explanations given to us, there
exists an adequate internal control
system commensurate with the size
of the company and the nature of its
business with regard to purchases
of inventory, fixed assets and with
regard to the sale of goods and services.
During the course of our audit , we
have not observed any continuing failure
to correct major weaknesses in internal
controls. |
(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. |
| (v) |
(a) |
According
to the information and explanations
given to us, we are of the opinion
that 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. |
(xviii) |
|
The
Company has issued one crore share
warrants convertible into equivalent
number of equity shares of the company
to the
companies covered into section 301
of the Companies Act, 1956. The preferential
allotment was made in accordance with
the requirement of SEBI (Disclosure
and Investor Protection) Guidelines,
2000. The price at which the share
warrants have
been issued are not prima-facie prejudicial
to the interest of the company. |
| |
(b) |
In
our opinion and according to the information
and explanations given to us, the
transactions made in pursuance of
contracts or arrangements entered
in the register maintained under section
301 of the Companies Act, 1956 and
exceeding value of rupees five lacs
in respect of any party during the
period under review have been made
at prices which are reasonable having
regard to prevailing market prices
at the relevant time. |
(xix) |
|
Adequate
security has been created in respect
of debentures issued by the Company
and outstanding at the end of the
period under review. |
| (vi) |
|
In
our opinion and according to the information
and explanations given to us, the
Company has not accepted any deposits
from the public and consequently,
the directives issued by the Reserve
Bank of India and the provisions of
Section 58A, 58AA or any other relevant
provisions of the Companies Act, 1956
and the rules framed there under are
not applicable to the Company. |
(xx) |
|
The
Company has not raised any money by
public issue during the period under
review. |
| (vii) |
|
In
our opinion, the Company has an internal
audit system commensurate with the
size and the nature of its business. |
(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. |
| |
For
N. C. Banerjee & Co. |
| |
|
sd/- |
| |
|
Chartered
Accountants |
| Place
: Kolkata, |
|
B.
Basu |
Date : The 3rd Day of June, 2006
|
|
Membership
No. 12748 |
|
Top |
|
|
|
Top |
|
|
|
Profit
and Loss Account
for the period ended
31st March, 2006 |
| |
|
|
|
| |
|
|
Rs. in Lacs |
|
|
Schedule |
Current
Period |
Previous
Period |
|
Income |
|
|
|
|
Sales |
|
55,373.63 |
28520.58 |
|
Other
Income |
12 |
24,839.05 |
111.34 |
|
Increase
/ (decrease) in stocks |
13 |
3,616.69 |
7387.90 |
| |
|
|
|
|
|
|
83,829.37 |
36019.82 |
| |
|
|
|
|
EXPENDITURE |
|
|
|
|
Purchase |
|
34,374.48 |
20657.95 |
|
Manufacturing
expenses |
14 |
2,102.16 |
1013.48 |
|
Administrative,
selling and other expenses |
15 |
6,476.02 |
1007.42 |
| |
|
|
|
|
INCOME
FROM OPERATORS |
|
40,876.71 |
13340.97 |
|
Interest |
16 |
1,280.95 |
159.40 |
|
Depreciation |
4 |
968.13 |
352.68 |
| |
|
|
|
|
Profit
/ (loss) before Tax |
|
38,627.62 |
12828.89 |
|
Provision
for Taxation |
|
|
|
Current
Tax
|
|
2,845.12 |
2,502.00 |
Deferred
Tax
|
|
4,565.74 |
1,249.15 |
Frienge
Benifit Tax
|
|
17.58 |
– |
|
|
|
|
|
Profit
/ (loss) after Tax |
|
31,199.19 |
9,077.74 |
|
Balance
brought forward |
|
2,568.76 |
796.39 |
| |
|
|
|
|
|
|
33,767.94 |
9,874.12 |
|
APPROPRIATIONS |
|
|
|
|
Transfer
to general reserve |
|
15,000.00 |
6,000.00 |
|
Interim
dividend |
|
3,896.72 |
1,217.40 |
|
Proposed
dividend |
|
599.77 |
471.59 |
|
Dividend
tax |
|
630.39 |
227.96 |
|
Debenture redemption
reserve |
|
1,250.00 |
– |
| |
|
|
|
|
Balance
carried to Balance sheet |
|
12,391.06 |
1,957.17 |
| |
|
|
|
|
Basic
Earning per share (in Rs.) |
|
29.76 |
26.61 |
|
Diluted Earnings per
Share (in Rs.) |
|
27.02 |
26.61 |
|
Notes on Accounts |
17 |
|
|
|
Top |
|
|
|
9,92,68,816 Equity
Shares of Rs.10/- each
fully paid up, ( Previous year 4,71,59,408) |
|
9,926.88 |
4,715.94 |
|
(Out of the above
shares 7,49,42,116 Equity Shares
of Rs.10/- each were issued as fully
paid up Bonus
Shares by Capitalisation of Free Reserve
(Previous Year 4,71,59,408) |
|
|
|
| 70,80,000
Equity Shares of Rs. 10/- each were
issued for consideration other than
cash (Previous Year 70,80,000) |
|
|
|
|
Share Suspense
Account |
|
|
|
|
20684205 Equity Shares
of Rs. 10/- each are to be issued
as 2,068.42 – per the scheme of amalgamation
with effect from 1st October, 2004
to the shareholders of FCGL Industries
Ltd. |
|
11,995.30 |
4,715.94 |
| Signatories
to Schedule 1 to 17 |
|
|
| |
|
|
| As per
our attached report of even date |
|
|
| For
N. C. Banerjee & Co. |
For
& on behalf of the Board |
| Chartered
Accountants |
|
|
| |
sd/- |
sd/- |
| |
G.
L. Jagatramka |
A.
K. Jagatramka |
| |
Chairman |
Vice
Chairman & Managing Director |
| |
|
|
| sd/- |
sd/- |
sd/- |
| B.
Basu |
S.
K. Khetan |
Manish
Lohia |
| Partner |
President
& Company Secretary |
Chief
Financial Officer |
| Membership
No. 12748 |
|
|
| Kolkata,
The 3rd Day of June, 2006 |
|
|
|
Top |
|
|
BALANCE SHEET ABSTRACT
AND COMPANY'S BUSINESS PROFILE
| I. |
Registration
Details |
|
| |
Registration
No. |
040098 |
| |
State Code |
021 |
| |
Balance
Sheet Date |
31st
March, 2006 |
| II. |
Capital
raised during the year (Amount Rupees
in Thousands) |
|
| |
Public
Issue |
Nil |
| |
Rights
Issue |
Nil |
| |
Bonus Issue |
471,594.08 |
| |
Private
Placement 49,500.00 |
|
| |
Shares
Issued pursuant to Scheme of Amalgamation
|
206,842.05 |
| III. |
Position
of Mobilisation and Deployment of Funds
(Amount Rupees in Thousands) |
|
| |
Total Liabilities |
10,926,307.76 |
| |
Total Assets |
10,926,307.76 |
| |
Sources
of Funds |
|
| |
Paid up
Capital |
1,199,530.21 |
| |
Reserves
and Surplus |
3,936,412.42 |
| |
Foreign
Currency Convertible Bonds |
2,399,650.00 |
| |
Secured
Loans |
2,707,217.23 |
| |
Unsecured
Loans |
0.00 |
| |
Deferred
Tax Liability |
582,497.91 |
| |
Application
of Fund |
|
| |
Net Fixed
Assets |
3,694,477.27 |
| |
Capital
Working Progress |
15,545.29 |
| |
Investments |
4,947,507.65 |
| |
Net Current
Assets / Liabilities |
2,209,265.78 |
| |
Miscellaneous
Expenditure |
59,511.77 |
| IV. |
Performance
of the Company (Amount Rupees in Thousands) |
|
| |
Turnover
(including Other Income) |
8,021,268.71 |
| |
Total Expenditure |
4,158,506.56 |
| |
Profit
/ (Loss) before Tax |
3,862,762.15 |
| |
Profit
/ (Loss) after Tax |
3,119,918.67 |
| |
Earnings
Per Share (Basic) in Rs. |
29.76 |
| |
Earnings
Per Share (Diluted) in Rs. |
27.02 |
| |
Dividend
(including 45% interim) |
50% |
| V. |
Generic
Names of Principal Products / Services
of the Company (As per Monetary Terms)
|
|
| |
Product
description |
Item Code No. (ITC Code) |
| |
Coke |
2704
00 30 |
| |
TMT Bar |
7213
10 90 |
| |
MS Round |
7213
20 90 |
| |
|
|
|
sd/- |
sd/- |
|
G.
L. Jagatramka |
A.
K. Jagatramka |
|
Chairman |
Vice
Chairman & Managing Director |
| |
|
|
sd/- |
sd/- |
|
S.
K. Khetan |
Manish
Lohia |
|
Kolkata,
The 3rd Day of June, 2006 |
President
& Company Secretary |
Chief
Financial Officer |
|
Top |
|
|
|
|
|
|
|
Rs.
in Lacs |
|
|
|
For
the Period ended
31st March, 2006 |
For
the Period ended
30th September, 2004 |
|
A. |
Cash
Flow from Operative Activities |
|
|
|
|
Net Profit
Before Tax & Extraordinary Items
|
38,627.62 |
12,828.80 |
|
|
Adjustments
for: |
|
|
|
|
Depreciation
/ Other non cash items |
2,628.61 |
373.35 |
|
|
Net Other
Income |
(23,923.12) |
(8.64) |
|
|
Net
Loss on Sale / Discard of Fixed Assets
|
1.64 |
1.08 |
|
|
Interest
Received |
(915.93) |
(102.69) |
| |
|
|
|
|
|
Operating
Profit before working Capital Changes |
16,418.82 |
13,091.99 |
|
|
Adjustments
for: |
|
|
|
|
Trade
& Other Receivables |
(7,528.68) |
(3,895.55) |
|
|
Inventories |
(3,597.15) |
(7,859.77) |
|
|
Trade Payables |
(642.63) |
8,921.24 |
| |
|
|
|
|
|
Cash
Generated from Operations |
4,650.36 |
10,257.91 |
|
|
Direct
Taxes Paid / Refunds |
(4,878.70)
|
(1,696.50) |
|
|
|
|
|
|
|
Cash
generated from operating activities
|
(228.34) |
8,561.41 |
|
B. |
Cash
Flow from Investing Activities |
|
|
|
|
Addition
to Fixed Assets |
(28,540.90) |
(6,374.75) |
|
|
Sale of
Fixed Assets |
7.27 |
2.75 |
|
|
Addition
to Investments |
(54,267.45) |
(665.56) |
|
|
Sale
of Investments |
29,467.42 |
– |
|
|
Interest
Received |
915.93 |
102.70 |
|
|
Dividend
/ Misc Income |
609.13 |
8.64 |
| |
|
|
|
|
|
Net
cash used in investing activities |
(51,808.60) |
(6,926.22) |
|
C. |
Cash
Flow from financing activities |
|
|
|
|
Net
Proceeds to Share Capital / Reserves
(incl Share Warrant) |
9,900.00 |
774.90 |
|
|
Deposit
against Share Warrant |
1,010.00 |
– |
|
|
Proceed
from Foreign Currency Convertible Bond |
23,996.50 |
– |
|
|
Increase
in Long / Short term borrowing |
22,423.43 |
3,917.09 |
|
|
Dividend
/ Dividend TaxPaid |
(5,059.27) |
(1,738.54) |
|
|
Unsecured
Loans |
(561.16) |
561.15 |
|
|
Payment
for Increase in Authorised Capital |
(92.50) |
(17.50) |
|
|
FCCB issue
related expenses |
(985.79) |
– |
| |
|
|
|
|
|
Net
cash generated from financing activities
|
50,631.21 |
3,497.10 |
|
|
Net increase
/ (decrease) in cash & cash equivalents |
(1,405.73) |
5,132.29 |
|
|
Cash
& cash equivalents (Opening Balance)
|
6,224.23 |
1,089.48 |
|
|
Cash &
cash equivalents received on amalgamation |
2.57 |
2.46 |
|
|
Cash
& cash equivalents (Closing Balance)
|
4,821.07 |
6,224.23 |
|
|
|
|
|
| As
per our attached report of even date |
sd/- |
sd/- |
| For
N. C. Banerjee & Co. |
G.
L. Jagatramka |
A.
K. Jagatramka |
| Chartered
Accountants |
Chairman |
Vice
Chairman & Managing Director |
| sd/- |
|
|
| B.
Basu |
sd/- |
sd/- |
| Partner |
S.
K. Khetan |
Manish
Lohia |
| Membership
No. 12748 |
President
& Company Secretary |
Chief
Financial Officer |
Kolkata,
The 3rd Day of June, 2006
|
|
|
|
Top |
|
|
| 1. |
Name of the Subsidiary Company |
Bharat
NRE Coke Ltd. |
Gujarat
NRE
Australia Pty. Ltd.
|
Gujarat
NRE
FCGL Pty. Ltd. |
| 2. |
Financial year of the Subsidiary Company
ended on |
31.03.2006 |
31.03.2006 |
31.03.2006 |
| |
3. No.
of shares held in Subsidiary Company |
16,075,000 |
63,476,100
|
162,009,000 |
| 4. |
Extent
of Holding Company’s interest |
59.81% |
93.45% |
99.99% |
| 5. |
The net
aggregate of profits or losses of the
Subsidiary Company for its financial
year so far as they concern the members
of the Company |
|
|
|
| |
(a)
dealt with in the accounts of the holding
Company for the period ended March 31,
2006 |
— |
—
|
— |
| |
(b)
not dealt in the accounts of the holding
Company for the period ended March 31,
2006 |
(Rs.340.13
lacs) |
Rs.
525.52 lacs |
Rs.
108.62 lacs |
| 6. |
The net
aggregate of profits or losses of the
Subsidiary Company for its previous
financial years since it became a subsidiary
so far as they concern the members of
the Company |
|
|
|
| |
(a)
dealt with in the accounts of the holding
Company for the period ended March 31,
2006. |
— |
— |
— |
| |
(b)
not dealt in the accounts of the holding
Company for the period ended March 31,
2006. |
— |
— |
— |
| 7. |
Changes
in the interest of the Gujarat NRE Coke
Ltd., between the end of the financial
year and 31st March, 2006. |
— |
— |
— |
| 8.
|
Material
changes between the end of the financial
year and 31st March, 2006. |
— |
— |
— |
| |
sd/- |
sd/- |
| |
G.
L. Jagatramka |
A.
K. Jagatramka |
| |
Chairman |
Vice
Chairman & Managing Director |
| |
|
|
| |
sd/- |
sd/- |
| Place :
Kolkata, |
S.
K. Khetan |
Manish
Lohia |
Date : The 3rd Day of June, 2006
|
President
& Company Secretary |
Chief
Financial Officer |
|
Top |
|