Annual Report 2001-2002 Madhusudan Oils And Fats Limited

Annual Report 2001-2002

Madhusudan Oils And Fats Limited


Board of Directors

Shri Vikram Somany (Chairman) Shri D. P. Goyal Shri S. C. Kothari Shri S. A. Trivedi

Bankers

Bank of Baroda ICICI Bank Ltd.

Auditors

M/s. H.V.Vasa & Co., Chartered Accountants, B-2, "Usha Kiran", Opp. Khanpur Gate, Ahmedabad - 380 001.

Registered office 9, GIDC Industrial Estate, Kadi-382 715, Dist. Mehsana, Gujarat, lndia.

Works 1) 9, GIDC Industrial Estate, Kadi - 382 715, Dist. Mehsana, Gujarat. 2) Lamba, Tal. Kalyanpur, Dist. Jamnagar, Gujarat.

Corporate Office

"Madhusudan House", Opp. Navrangpura Telephone Exchange, Ahmedabad - 380 006.

Contents

Directors' Report

Corporate Governance

Auditors' Report

Balance Sheet

Profit & Loss Account

Schedules 1 to 18

Cash Flow Statement

General Business Profile

Page No.

2

5

8

9

10

11

19

20

Annual General Meeting at 11.30 a.m. on Friday, the 27th day of September, 2002 at the Registered Office.

1


Direc tors ' Report To The Members,

The Directors have pleasure in submitting the Annual Report together with the Statement of Accounts of your Company for the year ended 31st March 2002.

Performance

The summary of your Company's financial performance is given below:

Profit before Depreciation and Taxes Deducting therefrom Depreciation of Profit before tax Deducting therefrom taxes of

- Current Year - Deferred Tax

Profit after tax Add: Balance brought forward from previous year

Amount available for Appropriations

The proposed appropriations are: 1. Proposed Dividend 2. General Reserve 3. Balance carried forward

Total

Year ended March 31, 2002

(Rs. in lacs)

282.86 199.27 83.59

6.50 31.95

45.14 —

45.14

32.25 2.89

10.00

45.14

Note : Previous year's figures are not available as the Company had acquired Ceramic Division of Madhusudan Industries Limited w.e.f. 01.04.2001, pursuant to the Order of Hon'ble Gujarat High Court dated 30-10-2001.

Sanitaryware Unit

The production of Sanitarywares was 12,177 MT against 12,678 MT in the Previous Year. Sales were 11,941 MT as against the last year sales of 10,954 MT. Exports were 1,658 MT i.e. 13.89% of the total sales. The increase in export was 25.82% of FOB value.

The Company intends to focus on further improvement of the plant's efficiencies and introduction of new designs of sanitarywares and in this direction the Company called various specialists including a foreign consultant in the field of Sanitarywares and utilized their services to improve upon the process losses and overall yield.

Power Unit

The current year was of low wind velocity. Consequently the total generation was 9,12,321 kwh against 3,16,109 kwh generated last year (December 2000 to March 2001).

Management Discussion and Analysis Report

(a) Industry Structure and Developments

The housing construction activities in the country determine the growth prospects for ceramic business. The growth of unorganized sector in sanitaryware has been a key factor in the stagnation of growth of manufacturers in the organized sector. There has also been cut-throat competition amongst organized sector manufacturers, resulting in price wars, but the Company has been able to withstand the competition.

The Company has launched through its trading division Plastic Cisterns and Seat Covers, which boosted the bottomline of the Company.

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(b) Opportunities and Threats

The growth of housing construction activities gives ample opportunity for growth of this division. Easy availability of housing loans, nuclear family culture, awareness about importance of bathroom decor, etc. are factors favourable to the growth.

On the other hand, mushrooming small-scale manufacturers, who are at a price-advantage because of the unequal government levy system existing in the country, enabling them circumvent excise duty, sales tax, etc., pose a threat to the rapid growth of the division in low value segment. While these small-scale manufacturers churn out sanitaryware of inferior quality and not conforming to any standard, the government not only loses revenue but even the customers are losers in the long run.

(c) Segment-wise / Product-wise Performance Sales:

Sanitarywares Trading Items

2001-2002 11,941 MT

Rs. 455 lacs

2000-2001

10,954 MT Rs. 285 lacs

Several new products launched in high value segment, has helped "CERA" maintain its sales in value and quantity terms.

(d) Outlook

The outlook for building industry appears to be bright in the coming year. The infrastructure projects have seen growth during the months of April and May 2002. The market sentiment has also changed and it appears that with the forecast of a good monsoon, the housing activities will spurt. The Company is also taking steps for further improving its products and reducing process losses.

(e) Risks and Concerns

While the downturn in market has affected all manufacturers, the company has been able to keep afloat because of the brand image of "CERA".

(f) lnternal control Systems and their adequacy

The Company has an adequate system of Interna! Control relating to purchase of stores, raw materials, plant & machineries, equipments & various components and for the sale of goods commensurate with the size of the Company and nature of business.

The system of Internal Control of the Company is adequate keeping in mind size and complexity of Company's business. Systems are regularly reviewed to ensure effectiveness.

(g) Financial Performance with respect to Operational Performance is discussed in the main part of the Report.

(h) Material Developments in Human Resources / Industrial Relations.

Human relationship has been close to heart of the management. It has been an on going exercise under which the Senior Management Personnel keep close co-ordination with the employees and the workers. At the middle management level too, the Superiors hold regular meetings at the floor level with the workers to understand the working problems. In order to further strengthen the human behaviour, the management is considering to organise HRD training at the floor level for supervisors and workers. In order to motivate the employees, various incentive schemes have been in operation.

The number of employees employed by the Company is 1187.

Madhusudan Oils And Fats Limited Corporate Governance

Pursuant to clause 49 of the Listing Agreement with the Stock Exchanges, Report on Corporate Governance has been included in this Annual Report as separate section.

Director's Responsibility Statement

In compliance of Section 217 (2AA) of the Companies Act, 1956 as amended by the Companies (Amendment) Act, 2000, the directors of your Company confirm:

— that the applicable accounting standards have been followed in the preparation of final accounts and that there are no material departures;

— that such accounting policies have been selected and applied consistently and such judgements and estimates made are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2002 and of the profit of the Company for the year ended on that date;

— that 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.;

— that the annual accounts have been prepared on a going concern basis.

Dividend

Your Directors recommend the dividend of Rs. 0.60 per share on 53,75,014 Equity Shares of Rs.5/- each fully paid. (Previous Year Rs. NIL) for the year ended 31st March, 2002, to be paid subject to approval by the members at the ensuing Annual General Meeting.

De-merger / Scheme of Arrangement

A Scheme of Arrangement between Madhusudan Industries Limited (MIL) and the Company i.e. Madhusudan Oils and Fats Limited (MOFL) for demerger of Ceramic Division of MIL to the Company was approved by the Hon'ble Gujarat High Court on 30.10.2001. As per the Order of Hon'ble Gujarat High Court, the Company has issued 53,75,000 Equity Shares of Rs.5/- each fully paid to the Shareholders of MIL in the ratio of one Equity Share per every Equity Share held by them.

Energy Conservation, Technology Absorption, R & D Cell and Foreign Exchange Earnings & Outgo

The details required under the Companies (Disclosure of particulars in the Report of Board of Directors) Rules, 1988 are annexed to this report.

Exchequer

The Company has contributed Rs.800.36 lacs to the exchequer by way of excise duty, customs duty, income tax, sates tax and other fiscal levies.

Fixed Deposit

Fixed Deposits from the Public, out-standing as on 31.03.2002 was Rs.63.44 lacs. There are 2 Fixed Deposit holders with Rs. 12,000/- of unclaimed / unrenewed deposits as on 31.03.2002. The Company on the basis of the working results during the year under review, can accept deposits from the Public as well as from the shareholders to the extent of Rs.668.72 lacs.

Pursuant to the Scheme of Arrangement and transfer of erstwhile Ceramic Division of Madhusudan Industries Limited to the Company,

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Ahmedabad 28th June, 2002

For and on behalf of the Board of Directors

Vikram Somany Chairman

Appreciation

Your directors thank the Financial Institutions and Bankers for extending timely assistance in meeting the financial requirements of the Company. They would also like to place on record their gratitude for the co-operation and assistance given by BOB, ICICI Bank Limited, IDBI and various departments of both State and Central Governments.

The Company has taken adequate steps for the health and safety of its employees, as required under the Gujarat Factories Rules, 1963.

The Company's relations with its employees were generally cordial during the year. However, the plant operations were temporarily suspended due to labour unrest between 6th April to 30th April 2002. Due to continuous cordial relations of the Company with its employees for last several years and intervention of Labour Department, Government of Gujarat brought a better understanding. The plant operations were normalized from 1st May 2002 and a new wage . agreement has also been executed for the period of 4 years with the Workers.

Industrial Relations

Insurance

The Company has adequately insured all its properties including Plant and Machinery, Building and Stocks.

M/s. H. V. Vasa & Co., Statutory Auditors of the Company retire at the end of forthcoming AGM and being eligible offer themselves for reappointment. The Board recommends their reappointment at the ensuing Annual General Meeting.

Auditors

Shri S. C. Kothari is due to retire by rotation and being eligible for reappointment, offers himself for the same.

Fixed Deposits of Rs.68.57 lacs have also been transferred. However, after the Order of Hon'ble Gujarat High Court, the Company has repaid Fixed Deposits amounting to Rs.5.13 lacs till 31.03.2002.

Finance

During the year under review, the Company repaid loans of Rs.362.42 lacs to Financial Institutions and Government of Gujarat.

Employees

The Company has no employee as specified under Section 217(2A) of the Companies Act, 1956, hence, there is no information required to be provided in this regard.

Directors

Shri N. K. Maheshwari resigned as Director w.e.f. 27.11.2001 and Shri G. K. Loya resigned as Director as well as Executive Director w.e.f. 15.05.2002, who were appointed as Additional and Executive Directors w.e.f. 27.11.2001. Your Board places on record its appreciation for the contributions made by them.

Shri Vikram Somany and Shri S. A. Trivedi were appointed as additional directors w.e.f. 27.11.2001 and 21.12.2001 respectively. Additional directors hold office upto the date of ensuing Annual General Meeting and being eligible offer themselves for reappointment.


Annexure to the Directors' Report

Disclosure of particulars with respect to Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo as required under the Companies (Disclosure of particulars in the Report of Board of Directors) Rules, 1988 and forming part of the Report of the Board of Directors for the period ended 31st March 2002.

FORM - A

Energy Conservation - Not Applicable

FORM - B

Research and Development (R & D)

a) Capital

b) Recurring

c) Total

d) Total R & D Expenditure as a percentage of total turnover

Rs. NIL

Rs. 20,43,848/-

Rs. 20,43,848/-

0.48%

4. Expenditure on R & D

3. Future plan of action : To minimize imports by developing substitution in India for better inventory management and cost reduction.

2. Benefit derived as a result : With the introduction of new sources and import substitution of raw materials and colours the cost of wares has come down. Further the Company has developed indigenous sources of Plaster of Paris as against imported plaster and this has resulted in saving substantially.

: The Company's Research & Development Unit is recognized by the Department of Scientific and Industrial Research, Government of India, since 1993. It has been constantly developing new body and glaze composition. There has been considerable improvement in wares quality also. It has also taken up the job for substitution of imported colours.

1. Specific areas in which R & D is carried out

Technology Absorption, Adaptation & innovation

1. Efforts in brief made towards technology absorption, adaptation and innovation.

2. Benefits derived as a result of the above efforts e.g. Product improvement, cost reduction, product development, import substitution etc.

3. In case of imported technology (Imported during the last five years reckoned from the beginning of the financial year) following information may be furnished.

a) Technology imported

b) Year of import

c) Has technology been fully absorbed

d) If not fully absorbed areas where this has not taken place, reasons therefore and future plans of action

UK & Italy

1999-2000 & 2000-2001

Yes, technology has been fully absorbed.

Not Applicable

The Company hired foreign consultant from Germany, who extensively worked at our works. It helped the Company in reducing process losses.

Total Foreign Exchange used and earned

Total foreign exchange used

Total foreign exchange earned

Rs. 113.75 lacs

Rs. 367.87 lacs

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Madhusudan Oils And Fats Limited A n n e x u r e to the Directors' Report

Terms of reference:

The role and terms of reference of the Audit Committee cover the matters specified for Audit Committees under Clause 49 of Listing Agreement and Section 292A of the Companies Act, 1956.

4) Remuneration Committee

The Company has formed a Remuneration Committee on 02.05.2002.

The Committee consists of Chairman Shri S. C. Kothari, Shri D. P. Goyal and Shri S. A. Trivedi.

The Committee will fix the Remuneration of Whole-time Directors, which includes all elements of remuneration package i.e. salary, benefits, bonus, pension, retirement scheme, share options and such other benefits.

The Committee will also decide the fixed component and performance linked incentives, performance criteria, service contracts, notice period, severance fees etc. of the remuneration package of working directors, as may be necessary.

5) Remuneration Policy

Remuneration of employees largely consists of basic remuneration and perquisites.

The component of the total remuneration varies for different grades and is governed by Industry pattern, qualifications and experience of the employee, responsibilities handled by him and his individual performance, etc.

The objectives of the remuneration policy are to motivate employees to excel in their performance, recognise their contribution, to retain talent in the organisation and accord merit.

6) Details of remuneration for the year ended 31.03.2002

(i) Whole-time Director(s)

Name

Shri G. K. Loya * Executive Director * Resigned w.e.f. 15.05.2002.

Salary (Rs.)

6,72,000/-

Perquisites and retirement benefits (Rs.)

3,42,191/-

(ii) Non-Executive Directors

Non-Executive Directors are not paid any sitting fees for attending the meeting of Board of Directors, neither they have been paid any other remuneration by way of commission or otherwise.

7) Share Transfer Committee

In accordance with Clause 49 para VI(D) of the Listing Agreement of the Stock Exchanges, the Board had delegated the powers of share transfers to the Share Transfer Committee. In order to expedite the process of share transfers/ transmissions/ split/ consolidation, the Committee meets at least once in a fortnight.

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CORPORATE GOVERNANCE REPORT (As required by Clause 49 of the Listing Agreement of the Stock Exchanges)

1) Company's Philosophy

The Company believes in the practice of good Corporate Governance and acting as a good corporate citizen.

The spirit of Corporate Governance has been prevailing in the Company. The Company believes in the values of transparency, professionalism and accountability. The Company recognises the accountability of the Board and importance of its decisions on its customers, dealers, employees, shareholders and with every individual, who come in contact with the Company.

2) Board of Directors

The Board comprises of a Chairman, and three non-executive directors.

The Company did not have any pecuniary relationship or transactions with the non-executive directors during the period under review.

During the year, nine Board Meetings were held on 21.06.2001, 17.07.2001, 07.09.2001, 13.09.2001, 27.11.2001, 21.12.2001, 26.12.2001, 30.01.2002 and 23.02.2002.

None of the directors on the Board are members in more than ten committees and they do not act as Chairman of more than five committees across all companies in which they are directors.

The composition of directors and their attendance at the Board Meetings during the year and at the last Annual General Meeting as also number of other directorships and committee memberships are given below:

SI. No

1.

2.

3.

4.

5.

6.

Name of . Director

Shri Vikram Somany *

Shri D. P. Goyal

Shri G. K. Loya **

Shri N. K. Maheshwari ***

Shri S.C. Kothari

Shri S. A. Trivedi ****

Category of Directorship

Chairman

Non-Executive Director

Whole-time Director




No.of Board

Meetings attended

1

9

2

5

9

1

Attendance

at last AGM

N.A.

Yes

N.A.

Yes

Yes

N. A.

No.of other

directorships

3

2

-2

1

-

No.of Other

Committee Members

-

-----

* Appointed w.e.f. 27.11.2001.

** Appointed w.e.f. 27.11.2001 and resigned w.e.f. 15.05.2002

*** Resigned w.e.f. 27.11.2001.

**** Appointed w.e.f. 21.12.2001.

3) Audit Committee

The Audit Committee was formed on 21.12.2001. The Audit Committee consists of 3 (three) independent directors, namely Chairman Shri S. C. Kothari, Shri D. P. Goyal and Shri S. A. Trivedi. During the year, only one Audit Committee Meeting was held i.e. on 30.01.2002.


8) Shareholders' / Investors' Grievance Committee

The Board has formed a Shareholders' / Investors' Grievance Committee consisting of the following independent directors:

Shri S. C. Kothari

Shri D. P. Goyal

Shri S. A. Trivedi

- Chairman

- Member

- Member

All investor complaints, which cannot be settled at the level of Company Secretary and Compliance Officer, will be forwarded to the Shareholders' Grievance Committee for final settlement.

During the year ended 31.03.2002, the Company had received 7 complaints from the Shareholders.

All the complaints received from the Shareholders were resolved. There is no complaint pending, which is not attended/ replied by the Company as on 31.03.2002.

The Company confirms that there were no share transfers lying pending as on 31.03.2002, and all requests for dematerialisation and remateriaiisation of shares as on that date were confirmed/ rejected into the NSDL/ CDSL system.

9) General Body Meetings

The last three Annual General Meetings were held as under:

Financial Year ended

31.03.2001

31.03.2000

31.03.1999

Date

27.09.2001

27.09.2000

29.09.1999

Time

11.30 a.m.

1.30 p.m.

11.30 a.m.

Venue

Rakhial Station, Taluka Dehgam District Gandhinagar - 382315.



No special resolutions were required to be put through postal ballot last year.

Alteration of object clause of Memorandum of Association (item No. 7 of notice) by voting through postal ballot as recommended under Clause 49 of the Listing Agreement of the Stock Exchanges is placed for shareholders approval at this meeting.

10) Disclosures

1. There were no transactions of material nature with the directors or the management or their subsidiaries or relatives etc. during the year, which may have potential conflict with the interests of the Company at large.

2. There were no instances of non-compliance of any matter related to the capital market, during the last three years.

11) Means of Communication

1. Quarterly results are published in leading daily newspapers viz. Financial Express / Economic Times and a local language newspaper viz. Jai Hind / Loksatta. The annual results are posted to all the members of the Company.

6

2. Management Discussion & Analysis forms part of this annual report, which is also being posted to all the members of the Company.

3. The official news releases, if any, are given directly to the press.

12) General Shareholder Information

1. Annual General Meeting :

- Date and Time : 27th September, 2002 : 11.30 a.m.

-Venue : 9, GIDC industrial Estate, Kadi-382 715, Dist. Mehsana.

2. Financial Calendar 2002-03 (tentative) :

Annual General Meeting

Results for quarter ending June 30, 2002

Results for quarter ending September 30, 2002

Results for quarter ending December 31, 2002

Results for year ending March 31, 2003 (Audited)

3rd / 4th week of September 2003

By last week of July 2002

By last week of October 2002

By last week of January 2003

3rd / 4th week of June 2003

3. Book Closure date 16th September 2002 to 27th September 2002 (Both days inclusive).

4. Dividend payment by the Company :

1. The members whose names will appear in the register of members of the Company, on 16th September after giving effect to all valid transfer of shares in physical form lodged with the Company on or before 15th September 2002 at the end of business hours.

2. In respect of shares held in demat form, the members whose names appear on the statement of beneficial ownership furnished by NSDL and CDSL at the end of business hours on 15th September 2002.

3. Dividend will be paid within 30 days from the date of approval by the members at the Annual General Meeting.

5. Listing on Stock Exchanges

The Company's shares were listed at Ahmedabad & Kolkata Stock Exchanges on 06.02.2002 and at Mumbai Stock Exchange on 15.05.2002 and the listing fees for the year 2002-03 have been paid to the Stock Exchanges. As Mumbai Stock Exchange has given listing permission in May 2002, there were hardly any transaction upto 31.03.2002 at any Stock Exchange.

Madhusudan Oils And Fats Limited 16) Dematerialisation of Shares as on 31.03.2002

As on 31st March 2002,13.69% of the Company's total shares representing 7,35,726 Shares were held in dematerialised form and the balance 86.31% representing 46,39,288 shares were in paper form.

The ISIN Number in NSDL and CDSL is "INE 739E01017".

17) Locations

The Company's plants are located at the following places:

1. 9, GIDC Industrial Estate, Kadi, Dist. Mehsana - 382 715, Gujarat.

2. Lamba, Tal. Kalyanpur, Dist. Jamnagar, Gujarat.

18) Address of Correspondence

The Company's Registered Office is situated at 9, GIDC Industrial Estate, Kadi, Dist. Mehsana - 382 715, Gujarat. Shareholders' correspondence should be addressed either to the Registered Office of the Company as stated above and / or to the Corporate Office of the Company at "Madhusudan House", Opp. Navrangpura Telephone Exchange, Ahmedabad - 380 006.

AUDITORS' CERTIFICATE

To The Members of Madhusudan Oils And Fats Limited

We have examined the compliance of conditions of Corporate Governance by Madhusudan Oils And Fats Limited, for the year ended 31st March 2002, as stipulated in Clause 49 of the Listing Agreement of the said Company with 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 the 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, we certify that the Company has complied with the conditions of Corporate Governance as stipulated in the above mentioned Listing Agreement.

We state that no investor grievance(s) is / are pending for a period exceeding for one month against the Company as per the records maintained by the Shareholders / Investors Grievance Committee.

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 and on behalf of H. V. Vasa & Co.

Chartered Accountants

Tushar H. Vasa Proprietor

7

6. Share Transfer

Share transfer work is being carried out in-house at the Corporate Office of the Company at "Madhusudan House", Opp. Navrangpura Telephone Exchange, Ahmedabad - 380 006. The Shares of the Company are being compulsorily traded in dematerialised form. Request for dematerialisation and rematerialisation should be sent directly to Madhusudan Oils and Fats Limited, Corporate Office at "Madhusudan House", Opp. Navrangpura Telephone Exchange, Ahmedabad - 380 006. Shareholders have option to open their accounts with either NSDL or CDSL as the Company has entered into agreements with both of these depositories.

13) Share Transfer System

The share transfers are normally effected within a period of 15-20 days from the date of receipt, provided the documents being complete in all respects. The Company has, as per SEBI guidelines offered the facility of Transfer-Cum-Demat. Under the said system, after the share transfer is effected, a letter will be sent to the transferee indicating the details of the shares transferred and in case the transferee wishes to demat the shares, he can approach the Depository Participant (DP) with the letter of the Company. DP will generate a demat request on the basis of the letter of the Company, which he will send to the Company alongwith the option letter issued by the Company. On receipt of the same, the Company will dematerialise the Shares. In case, the transferee does not wish to dematerialise the shares, he need not exercise the option and the Company will despatch the Share Certificates.

14) Distribution of Shareholding as on 31.03.2002

No. of Shares

Upto 500

501 - 1000

1001 -2000

2001 - 3000

3001 - 4000

4001 - 5000

5001 - 10000

10001 and above

Total

No. of Shareholders

7,225

100

37

8

3

6

8

32

7,419

Total No. of Shares

9,15,787

74,086

55,905

20,210

10,834

27,164

55,581

42,15,447

53,75,014

15) Pattern of Shareholding

Sr. No.

1.

2.

3.

4.

5.

6.

Category

NRI

Financial Institutions/ Banks

Mutual Funds

Promoters

Body Corporate

Others

Total

No.of Shares

1,250

2,84,007

425

31,37,980

2,51,522

16,99,830

53,75,014

(%)

0.02

5.28

0.01

58.38

4.68

31.63

100.00


Auditors' Report to the Members

We have audited the attached Balance Sheet of MADHUSUDAN OILS AND FATS LIMITED, as at 31st March, 2002 and also the Profit and Loss Account for the year 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 management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

(1) We have obtained all the information and explanations which, to the best of our knowledge and belief, were necessary for the purpose of our audit;

(2) In our opinion, proper books of accounts as required by law, have been kept by the Company so far as appears from our examination of those books;

(3) The Balance Sheet and Profit and Loss Account comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956;

(4) The Balance Sheet and the Profit and Loss Account referred to in this report are in agreement with the books of accounts;

(5) The report on the Accounts of the branches, audited by the other Auditors has been forwarded to us and the same has been considered by us in our report.

(6) As per the representation made by the Company all its Directors, no Director is disqualified from being appointed as Director U/s. 274(1 )(g) of the Companies Act, 1956;

(7) !n our opinion and to the best of our information and according to explanations given to us, the said Balance Sheet and Profit and Loss Account, read together with the Notes and Schedules annexed thereto, give the information required by the Companies Act, 1956 in the manner so required and give a true and fair view:

(a) in so far as it relates to the Balance Sheet, of the state of affairs of the Company as at March 31, 2002, and

(b) in so far as it relates to the Profit and Loss Account, of the profit of the Company for the year ended on that date.

Annexure to the Auditors' Report

As required by the Manufacturing and Other Companies (Auditors' Report) Order, 1988, issued by the Department of Company Affairs in terms of Section 227(4A) of the Companies Act, 1956, we have annexed hereto a statement on the matters specified in paragraphs 4 and 5 of the said Order.

(1) (a) The Company has maintained proper records, showing full particulars, including quantitative details and situation of its fixed assets, other than furniture and fixtures.

(b) The Fixed Assets have been physically verified by the management during the year and we have been informed that no material discrepancies were found on such verification.

(2) None of the Fixed Assets have been revalued during the year under report.

(3) (a) The stocks of finished goods, stores, spare parts, raw and packing materials of the Company at all its locations have been physically verified by the management during the year.

(b) In our opinion, the procedures of physical verification of stocks followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business.

(c) The discrepancies noticed on physical verification of stocks as compared to book records were not material and these have been properly dealt with in the books of accounts.

(d) In our opinion, valuation of stocks of finished goods, stores, spare parts and raw and packing materials has been fair and proper in accordance with the normally accepted accounting principles and is on the same basis as in the preceding year.

(4) The Company has not taken any unsecured loan from the parties and subsidiary

8


For and on behalf of H.V.Vasa & Co.

Chartered Accountants Tushar H. Vasa

Proprietor

company listed in register maintained under section 301 of the Companies Act, 1956 in respect of which the rate of interest and other terms and conditions of such loan are not prejudicial to the interest of the company.

(5) (a) The Company has not granted any loans, secured or unsecured, to companies, firms or other parties listed in the register maintained under section 301 and/or to the companies under the same management as defined under sub section (1B) of section 370 of the Companies Act, 1956.

(b) The parties to whom loans and advances in the nature of loans have been given by the company are repaying the principal amounts as stipulated and are also regular in payment of interest. The Company has given interest free loans and advances to its employees and they are repaying principal amounts as stipulated.

(6) In our opinion, there is an adequate internal control procedure commensurate with its size and the nature of business, for purchase of stores, raw and packing materials including components, plant and machinery equipments and other similar assets and for the sale of goods.

(7) According to the information given to us, there are no purchase but sale of goods and material during the year aggregating Rs.50,000/- or more in value to a company in which directors are interested as listed in the register maintained under section 301 of the Companies Act, 1956, have been made at prices, which in our opinion, are reasonable having regard to prevailing market prices of such goods, materials or services or the prices at which similar transactions have been made with other parties and the Company's business needs and exigencies.

(8) The Company has a system of determining unserviceable or damaged stores, raw and packing materials and finished goods on the basis of technical evaluation and on the aforesaid basis, in our opinion, adequate amounts have been written off such stocks in the accounts.

(9) In our opinion, and according to the information and explanations given to us, the Company has complied with the provisions of section 58A of the Companies Act, 1956 and the Companies (Acceptance of Deposit) Rules, 1975.

(10) In our opinion, reasonable records have been maintained by the Company for the sale and disposal of realisable by-products and scraps, where applicable and significant.

(11) In our opinion, the Company's present internal audit system is commensurate with its size and the nature of business.

(12) On the basis of the records produced, we are of the opinion that, prima facie, the Cost Records and Accounts of vanaspati and soap units prescribed by the Central Government under section 209(1)(d) of the Companies Act, 1956 have been maintained. However, we are not required to carry out and have not carried out any detailed examination of such accounts and records.

(13) The Company has regularly deposited Provident Fund dues and generally been regular in depositing Employees' State Insurance dues during the year, with the appropriate authorities.

(14) There was no amount outstanding on 31st March, 2002 in respect of undisputed Income-tax, Wealth-tax, Sales-tax, Customs duty and Excise duty which were due for more than six months from the date they became payable.

(15) During the course of our examination of the books of accounts, carried out in accordance with the generally accepted auditing practices we have not come across any personal expenses of Employees and Directors, which have been charged to Profit & Loss Account, nor have we been informed of such cases by the management.

(16) The Company is not a sick industrial company within the meaning of clause (0) of section 3(1) of the Sick Industrial Companies (Special Provisions) Act, 1985.

(17) In respect of trading activities, damaged goods have been determined at the time of physical verification consequential adjustments, which were not significant, have been made in the accounts.

Madhusudan Oils And Fats Limited Balance Sheet a s a t 3 1 s t M a r c h , 2 0 0 2

I. Sources of Funds

1. Shareholders' Funds

(a) Share Capital

(b) Reserves & Surplus

2. Loan Funds

(a) Secured Loans

(b) Unsecured Loans

3. Deferred Tax Liability (Net)

Total

II. Application of Funds

1. Fixed Assets

(a) Gross Block

(b) Less : Depreciation

(c) Net Block

(d) Capital Work-in-progress

2. Investments

3. Current Assets, Loans & Advances

(a) Inventories

(b) Sundry Debtors

(c) Cash & Bank Balances

(d) Other Current Assets

Interest accrued on deposits

(e) Loans & Advances

Less : Current Liabilities & Provisions

(a) Liabilities

(b) Provisions

Miscellaneous Expenditure (To the extent not written off or adjusted)

Total Notes forming part of the Accounts

Schedule

1

2

3

4

5

6

7

8

9

10

11

12

18

31-3-2002

Rs.

2,68,75,070

16,41,86,506

10,25,15,779

5,87,76,665

32,08,07,013

1,96,51,323

30,11,55,690

93,836

13,23,80,140

8,59,74,354

1,80,18,089

98,297

84,50,357

24,49,21,237

12,48,45,784

38,75,008

12,87,20,792

Rs.

19,10,61,576

16,12,92,444

6,78,44,657

42,01,98,677

30,12,49,526

2,000

11,62,00,445

27,46,706

42,01,98,677

31-3-2001

Rs.

70

—

— —

— — — —

— — 10

— —

10

17,190

—

17,190

Rs.

70

— —

70

— —

-17,180

17,250

70

As per our report of even date attached For and on behalf of H. V. Vasa & Co. Chartered Accountants



T.T.Patel Company Secretary


9


D. P. Goyal Director

S. C. Kothari Director

S. A. Trivedi Director


Profit a n d Loss Account for the y e a r ended 3 1 s t M a r c h , 2 0 0 2

lncome

Sales

Other Income

Increase (Decrease) in Finished Goods and Work-in-Process

Expenditure

Raw materials consumed

Purchases (Trading)

Payments to and provision for Employees

Other Expenses

Excise Duty & Cess

Interest

- On Term Loans

- On Others

Depreciation

Total Expenditure

Profit before Taxation

Provision for Taxation - Current Tax - Deferred Tax

Profit After Taxation

Profit Available for Appropriations

Appropriations

Proposed Dividend

Transferred to General Reserve

Balance Carried to Balance Sheet

Notes forming part of the Accounts

No. of Equity Shares (Face value Rs. 5/- (10) each)

Basic and diluted earning per share (in Rs.)

Schedule

13

14

15

16

17

18

2001-2002

Rs.

41,21,47,728

98,48,018

1,03,89,970

88,62,394

Rs.

42,19,95,746

35,57,071

42,55,52,817

7,11,18,780

3,50,78,595

7,28,19,538

15,35,68,228

4,54,28,357

1,92,52,364

1,99,27,368

41,71,93,230

83,59,587

6,50,000 31,95,387

45,14,200

45,14,200

32,25,008

2,89,192

10,00,000

45,14,200

53,75,014

0.84

2000-2001

Rs.

— —

— __

Rs.

—

—

—

— — — — —

— —

— —

— —

— —

—

—

—

—

7

—





10





S. A.Trivedi Director

Madhusudan Oils And Fats Limited Schedules 1 to 18 Annexed to And Forming Part Of The Accounts As At 31st March , 2 0 0 2

1. Share Capital

Authorised

60,00,000 (10,000) Equity Shares of Rs. 5 (10) each

Total

Issued, Subscribed & Paid Up

53,75,014 (7) Equity Shares of Rs. 5 (10) each fully paid

i) See note -2 schedule 18

ii) of the above 5375000 Equity Shares al lot ted as ful ly paid pursuant to the scheme of arrangement as per order of Hon'ble Gujarat High Court dated 30-10-2001

Total

31-3-2002

Rs. Rs.

3,00,00,000

3,00,00,000

2,68,75,070

2,68,75,070

31-3-2001

Rs. Rs.

1,00,000

1,00,000

70

70

2. Reserves and Surplus

General Reserve

As per last Balance Sheet

Add : Transferred as per Scheme of Arrangement

Less: Issue of fully paid up Equity Shares of Rs. 5/-each pursuant to scheme of Arrangement

Less: Transferred to Net Deferred Tax liability

Add : Transferred from Profit and Loss Account

Profit and Loss Account

Total

— 25,44,21,584

2,68,75,000

6,46,49,270

2,89,192

16,31,86,506

10,00,000

16,41,86,506

— __

—

—

—

—

3. Secured Loans

From Banks :

1. Cash / Packing Credit

Bank of Baroda (See note 1)

ICICI Bank Ltd. (See note 1)

2. Term Loan

Bank of Baroda (BOB) (See note 2)

Total

4,63,87,301

1,48,78,478

6,12,65,779

4,12,50,000

10,25,15,779

— —

—

—

—

—

Notes

1. Credit facilities from BOB and ICICI Bank Ltd. are secured by hypothecation of Stocks, Book Debts and vehicles purchased and personal guarantee of a director.

2. Term Loan by BOB to Ceramic Division of Madhusudan Industries Limited is transferred to the Company pursuant to the approved Scheme of Arrangement. It is secured by equitable mortgage of immovable properties (excluding housing colony) and by hypothecation of its movable machineries and equipments.

11


4. Unsecured Loans

Fixed Deposits

Interest Accrued and Due

Interest Free Loan (Sales -Tax) from Govt. of Gujarat

Total

31-3-2002

Rs.

63,44,000

1,42,391

Rs.

64,86,391

5,22,90,274

5,87,76,665

31-3-2001

Rs.

— —

Rs.

— —

—

5. Fixed Assets

Sr. No.

A.

B.

C.

D.

E.

Name of Assets

Land

- Free hold

- Lease hold

Buildings

Plant & Machinery

Electric Plant & Installation

Laboratory Equipments

Weighing Machinery

Furniture, Fixtures and Equipments

Vehicles

Total

Gross Block (At Net Value) @

Transfer*

Rs.

34,02,697

7,64,604

3,55,78,608

26,41,61,849

28,67,466

1,380

83,689

27,35,465

16,50,590

31,12,46,348

Additions

Rs.

12,155

-3,55,496

72,93,118

19,378

-15,400

21,53,622

13,551

98,62,720

Deductions/ Adjustments

Rs.

-9,870

-1,50,772

---

1,41,413

-

3,02,055

As on 31-3-2002

Rs.

34,14,852

7,54,734

3,59,34,104

27,13,04,195

28,86,844

1,380

99,089

47,47,674

16,64,141

32,08,07,013

Depreciation @

During the year

Rs.

--

31,30,604

1,46,09,402

1,66,218

212 11,899

15,61,870

4,47,163

1,99,27,368

Deductions/ Adjustments

Rs.

---

1,43,412

---

1,32,633

-

2,76,045

Upto 31-3-2002

Rs.

--

31,30,604

1,44,65,990

1,66,218

212 11,899

14,29,237

4,47,163

1,96,51,323

Net Block

As on 31-3-2002

Rs.

34,14,852

7,54,734

3,28,03,500

25,68,38,205

27,20,626

1,168

87,190

33,18,437

12,16,978

30,11,55,690

* Pursuant to the Scheme of Demerger (see note 2 of schedule-18) @ See note-1 of Schedule-18

6. Investments (At Cost)

Government Securities : (Unquoted) (Deposited with Government Departments)

National Savings Certificates

Total

Aggregate Book Value - Quoted

- Unquoted

Aggregate Market Value - Quoted

31-03-2002

Rs.

2,000

2,000

—

2,000

—

31-03-2001

Rs.

—

—

— — —

7. Inventories (Certified and valued by a Director )

Stores, Chemicals & Coat etc. (At Cost) (Including in transit Rs. 83,356)

Raw Materials (At Cost)

(Including in transit Rs. 10,62,956)

Finished Goods (At lower of cost or net realisable value )

Stock-in-process (At Cost)

Total

1,77,08,713

1,96,74,841

9,08,25,272

41,71,314

13,23,80,140

—

—

— —

—

12


8. Sundry Debtors (Unsecured- Considered Good)

A. Debts outstanding for a period exceeding 6 months

B. Others

Total

31-3-2002 Rs. Rs.

91,35,275

7,68,39,079

8,59,74,354

31-3-2001 Rs. Rs.

—

— —

9. Cash and Bank Balances

A. Cash on Hand (Including in transit and cheques on hand Rs. 18,42,678)

B. Balances with Scheduled Banks

On Current Accounts

On Fixed Deposit Accounts

Total

1,15,61,452

42,44,511

22,12,126

1,58,05,963

1,80,18,089

—

—

10

—

10

10. Loans and Advances

(Unsecured-considered Good)

Advances recoverable in cash or in kind or for a value to be received

(Includes -Secured Rs. 14,254)

Advance payment of Income-tax

Current Accounts with Excise Authorities

Total

70,91,411

2,50,000

11,08,946

84,50,357

—

—

—

—

11. Current Liabilities

Sundry Creditors (Includes due to Madhusudan Industries Limited Rs. 2,01,17,881/- on account of scheme of Arrangement)

Advance from Customers

Deposit by Dealers

Interest accrued but not due

Total

10,80,90,971

29,44,253

1,30,58,080

7,52,480

12,48,45,784

17,190

—

—

—

17,190

12. Provisions

For Taxation

Proposed Dividend

Total

6,50,000

32,25,008

38,75,008

—

—

—

13


13. Other Income Interest (Non-Trade Investments) (Gross)

Export Incentives

Claims received

Profit on Sale / Discarded of Fixed Assets (Net)

Miscellaneous income

Bad Debts Recovered

Items pertaining to previous years unspent liabilities and provisions no longer required written back (Net)

Total

2001-2002

Rs. Rs.

4,19,727

12,802

63,12,504

18,476

9,89,011

12,28,168

8,67,330

98,48,018

2000-2001

Rs. Rs.

— — — — — — —

—

14. lncrease (Decrease) in Finished Goods and Work-in Process Stock at Commencement

Finished Goods Stock in Process

Stock at Close Finished Goods Stock in Process

Total

8,86,75,407 27,64,108

9,08,25,272 41,71,314

9,14,39,515

9,49,96,586

35,57,071

— —

— —

—

— —

15. Raw Materials Consumed Opening Stock Add : Purchases (Net of transfers)

Less: Closing Stock

Total

2,50,68,011 6,57,25,610

9,07,93,621 1,96,74,841

7,11,18,780

— —

— — —

16. Payment to and Provision for Employees

Salaries, Wages and Bonus Contribution to Provident and other funds Staff and Labour Welfare Expenses

Total

5,96,04,594 91,42,368 40,72,576

7,28,19,538

— — — —

17. Other Expenses Stores, Spare Parts and Packing Materials Power and Fuel Repairs to :

Buildings Plant and Machinery Others

Rent (Net) Insurance Rates and Taxes Freight and Forwarding Expenses (Net) Brokerage, Commission and Discounts on Sales Publicity & Advertisement Expenses Research & Development Expenses Debts written off Miscellaneous Expenses Donations

Total

3,86,780 27,96,017 9,98,933

3,23,57,383 4,64,60,358

41,81,730 16,76,435 24,99,233

1,92,093 1,03,78,816 1,16,80,320 1,07,66,258

20,43,848 5,01,201

3,07,97,553 33,000

15,35,68,228

— — —

— —

— — — — — — — — — — — __

14

Madhusudan Oils And Fats Limited 18. Notes forming part of the Accounts for the year ended 31st March, 2002

1. Significant Accounting Policies

* Basis of Accounting

The Company prepares its financial statements on accrual basis in accordance with generally accepted accounting principles and comply with the Accounting Standards referred to in Section 211 (3C) of the Companies Act, 1956.

Sales

Sales include excise duty and net of discounts and sales-tax.

* Retirement Benefits

(i) Contribution to Provident and Superannuation Funds are made at applicable rates.

(ii) Contribution to approved Gratuity Fund is made of the present liability for future Gratuity as determined on the actuarial valuation. The Company has no further obligation except contribution to the fund.

(iii) Leave encashment benefit is accounted for on the basis of actuarial valuation.

* Fixed Assets, Depreciation and Amortisation

(a) Fixed Assets transferred on demerger scheme are stated at cost-less accumulated depreciation. Acquisitions and additions are stated at cost. The Company capitalises all costs relating to the acquisition and installation of Fixed Assets on net of MODVAT credits on the assets.

(b) Assets acquired under hire purchase instalment credit scheme, the cost of asset is capitalised while the annual financial charges at equated installments are charged to revenue.

(c) Depreciation for the year has been provided on net asset value at the rates and in the manner specified in Schedule-XIV of the Companies Act, 1956 as under:

(1) On Plant & Machinery and Electric Plant & Installation on straight-line method. (2) On other assets on written down value method.

(d) Leasehold land is amortised over the period of lease. In respect of other assets taken on lease before 01.04.2001, the value thereof is not capitalised, but the contracted lease rentals are charged to revenue on accrual basis.

(e) The value of discarded Plant and Machinery has been written down to the lower of net book value and net realisable value.

* Inventories

(a) Raw-materials, packing materials, stores, coal and chemicals are taken at weighted average cost following FIFO method.

(b) Stock-in-Process is valued at cost.

(c) Finished goods are valued at lower of cost and net realisable value.

(d) Excise duty on goods manufactured by the Company and remaining in inventory is included as a part of valuation of finished goods.

* Investments

Investments are stated at cost.

* Foreign Currency Transactions

Foreign currency transactions during the year are recorded at rates of exchange prevailing on the date of transaction. Foreign currency assets and liabilities are translated into Rupees at the rate of exchange prevailing on the date of the Balance Sheet. All exchange differences are dealt with in the statement of Profit and Loss, except those relating to the acquisition of fixed assets which are adjusted in the cost of the assets.

Accounts Receivable in foreign currency are either represented by bills of exchange, which in many cases, are immediately discounted with bankers, or accounted at realised amounts.

* Borrowing Cost

Borrowing costs that are attributable to the acquisition or construction of assets are capitalised as part of the cost of such assets.

* Taxation

Provision for tax for the year comprises current Income-tax determined to be payable in respect of taxable income and deferred tax being the tax effect of timing differences representing the difference between taxable income and accounting income that originate in one period, and are capable of reversal in one or more subsequent period(s).

Contingent Liability

Contingent liabilities determined on the basis of available information; wherever material are provided for and Contingent liabilities not provided for in the accounts are disclosed by way of notes to the accounts.

15


2. Transfer of Ceramic Division from Madhusudan Industries Limited (MIL)

i. The Honourable High Court of Judicature at Gujarat vide its order dated 30.10.2001 has sanctioned Scheme of Arrangement (the Scheme) U/s. 391 -394 of the Companies Act, 1956 between Madhusudan Industries Limited ("MIL") and the Company under which all the assets, liabilities and debts of the Ceramic Division as defined in the Scheme ("the Undertaking") of "MIL" comprising of Ceramic Division have been transferred to the Company at book value with effect from 01.04.2001.

ii. In terms of "the Scheme" all debts liabilities including contingent liabilities, duties and obligations relating to "the undertaking" whether disclosed or not in the books of account of "MIL' and all other liabilities relating to "the undertaking" which may accrue or arise after 31.03.2001 but which relates to the period upto 31.03.2001 shall be the debts, liabilities including contingent liabilities, duties and obligations of the Company.

iii. Accordingly, the assets and liabilities pertaining to "the undertaking" which have been transferred to the Company and the incomes and expenses arising / incurred resulting to "the undertaking" during the period between the appointed date i.e. 01.04.2001 and the effective date i.e. 23.11.2001 have been incorporated in these accounts. During the period, "MIL" carried on all business and activities relating to "the undertaking" for and on account of and in trust for the Company. Accordingly, all the vouchers, documents etc. pertaining to "the undertaking" during this period are in the name of "MIL".

iv. The title deeds, in respect of the freehold and leasehold land, which vested in the Company under "the Scheme", are being transferred in the name of the Company and pending such transfer continue to remain in the name of "MIL".

v. In terms of "the Scheme", all the employees engaged in 'the undertaking" stand transferred to the Company. The amount standing to the credit of these employees in the Provident Fund, Gratuity Fund and Superannuation Fund etc. also stand transferred to the Company, which is a member of Common Trusts in existence.

vi. As per "the Scheme" the Shareholders of MIL on record date; received one new Equity Share of the Company at a par value of Rs.5/- for each fully paid Equity Share of MIL held.

vii. All liabilities which relate to the period upto 31.03.2001, pertaining to the Ceramic Division, rest with the Company. Accordingly, provisions have been made in the Company's financial statements for the year.

3. Contingent liabilities in respect of : a. Claims against the Company not acknowledged as debts. b. Estimated amount of contracts remaining to be executed on capital

account not provided for (Net of advance) c. Bills discounted with Bank. d. Letters of Credit opened and guarantees given by the Bank in favour

of Parties and Government Authorities.

31-3-2002 Rs.

3,07,27,221 6,46,426

52,19,181 2,34,24,109

4. Current liabilities - Sundry Creditors include amount payable to SSI Units : a. Amount due to SSI units

b. Others

c. Amount payable to SSI units - More than One Lac and above 30 days or more : - G. V. Precision Plastic Teckniks Pvt. Ltd.

- Jaisal Plastics (Mumbai)

- Gagan Enterprises

- Jas Enterprise

- Mahakal Industries

- Jirrs Sales Corporation - Superflo Pvt. Ltd.

43,35,438

10,37,55,533

2,50,094

2,00,000

1,00,152

6,96,416

5,89,441

1,19,725

13,70,019 5. The Company has provided Rs. 25.71 lacs being increment in discounted value of liability for unavailed leave of the employees determined

as per actuarial valuation.

6. Miscellaneous expenses include payment to Auditors as under:

Statutory Auditors Audit Fees Other Services

Total

2001-2002 Rs.

63,000 21,000

84,000 7. Managerial Remuneration to Directors Under Section 198 of the Companies Act, 1956

(As per Schedule XIII of the Act) Executive Director i. Salary

ii. Contribution to Provident and Other Funds iii. Perquisites in cash or in kind

6,72,000

1,34,700 2,07,491

10,14,191

16

Madhusudan Oils And Fats Limited 8. In the previous year, Profit and Loss Account was not prepared since there were no operations in the said year. The Ceramic Division on

demerger is business undertaking w.e.f. 01 -04-2001; hence prior year figures while it was division of MIL are not incorporated.

9. Particulars in respect of goods manufactured : (On triple shift basis in tons per annum)

A. Capacity (In M.T.)

1. Vitreous China Sanitaryware

2. Non Conventional Energy (WTG)

B. Actual Production (In M.T.)

1. Vitreous China Sanitaryware

2. Non Conventional Energy (WTG) (in units)

Licensed

24,000

—

Installed (as certified by Management)

15,000

1 M.W.

12,177

**912321

** Under Energy Banking System, electricity produced is for use by Ceramic Division at Kadi.

C. (a) Sales and Stocks of Goods Manufactured and Traded

Vitreous China Sanitaryware

Sanitaryware (Trading)

Fittings (in Nos.)

Opening Stock

Quantity M.T.

3,222

— 32,514

Value Rs.

8,40,06,954

— 46,68,453

Closing Stock

Quantity M.T.

3,458

17

48,389

Value Rs.

8,52,55,045

1,58,000

54,12,227

Sales

Quantity M.T.

11,941

34

5,89,968

Value Rs.

36,66,92,511

3,27,605

4,51,27,612

41,21,47,728

Goods

Sanitaryware

Fittings (Pcs.)

Quantity M.T./Pcs.

51

6,05,843

Value Rs.

3,97,000

3,46,81,595

3,50,78,595

(b) Purchases

D. Item-wise break-up of Raw Materials Consumed

Sand, Sandstone, Clays & Chemicals

Current Year

Quantity M.T.

26,473

Value Rs.

7,11,18,780

7,11,18,780

E. Value of Imports on C.I.F. Basis

1. Raw Materials and Chemicals

2. Stores and Spare Parts

3. Capital Goods

2001-2002 Rs.

49,28,178

9,50,522

19,14,262

F. Value of Raw Materials, Stores & Spare Parts Consumed

1. Imported

2. Indigenous

Raw Materials

Rs.

1,20,22,542

5,90,96,238

%

16.90%

83.10%

Stores & Spare Parts

Rs.

11,57,542

2,96,56,388

%

3.76%

96.24%

G. Expenditure in Foreign Currencies on Account of

1. Travelling

2. Export Commission

3. Interest / Bank Charges

4. Others

Rs.

4,52,525

14,88,062

3,49,972

12,91,437

H. Earning in Foreign Exchange

Exports of Goods on F.O.B. Basis

Rs.

3,67,87,424

17


10. Related party disclosures

Type of Transactions

Purchases Goods & Materials Fixed Assets

Sales Goods & Materials

Expenses Lease Rent / Rent

Other Services

Interest paid

Finance Loans & Advances given

Deposit / Loan received Due to MIL under Demerger

Balance at the end of the year Deposits

Due to MIL under Demerger

Associates

16,633

13,551

2,49,604

6,83,506

75,000

—

— 2,01,17,881

— 2,01,17,881

Key Management

Personnel

— —

1,149

— —

5,74,648

-50,00,000

—

1,78,000

—

Relatives of Key

Management Personnel

— —

12,860

1,14,000

— 56,091

-1,07,000 __

1,74,000

__

Total

16,633

13,551

2,63,613

7,97,506

75,000

6,30,739

-51,07,000 2,01,17,881

3,52,000

2,01,17,881

Note :

Names of related parties in description of relationship :

1. Fellow subsidiaries 2. Associates Madhusudan Industries Limited

Cera Leasing Finance & Industries Limited

Madhusudan Cybernetic Pvt. Ltd.

3. Key Management Personnel

4. Relatives of Key Management Personnel

Goodluck Ceramics Pvt. Ltd. Shri Vikram Somany Shri G. K. Loya

Smt. Kamla Loya

(Wife)

Shri D. P. Goyal Shri S. C. Kothari Smt. Prem Kothari (Wife)

11. Note on deferred Tax Liability

1. a) In compliance with the Provisions of Section 211 (3C) and Accounting Standard AS-22 relating to "Accounting for taxes on income" of ICAI, the Company has adjusted the deferred tax liability (Net) of Rs. 6,46,49,270/- arising out of timing differences for the period upto 31st March 2001 of in general reserve and deferred tax Liability (Net) accruing during the year amounting to Rs. 31,95,387/-has been recognized in the Profit & Loss Account.

b) Major components of deferred tax Assets and Liabilities arising on account of timing differences are as under: Deferred Tax Liabilities on account of

Depreciation

Deferred Expenses

Less : Deferred Tax Assets on account of : Others

Total

Amount

Rs. 6,87,82,279

1,59,424

6,89,41,703

10,97,046

6,78,44,657

(Figures in brackets relate to previous year)






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S. A.Trivedi Director

Madhusudan Oils And Fats Limited Cosh Flow Statement for the y e a r e n d e d 3 1 s t M a r c h , 2 0 0 2

A. Cash flow from operating activities Net profit before tax & Extra-ordinary items Adjusted for

- Depreciation - Foreign Exchange

- Investment Income - Interest Charged

Operating profit before working capital changes Adjusted for

- Trade and other receivable - Inventories - Trade Payable

Cash generated from operation Interest paid Direct taxes paid

Cash flow before extra-ordinary items Extra-ordinary items

Net Cash From Operating Activities Total (A)

B. Cash flow from Investing activities Purchase of fixed assets Sale of fixed assets Purchase of Investments Sale of Investments (Net of Loss) Interest received Dividend received

Net Cash used in Investing Activities Total (B)

C. Cash flow from financing activities Proceeds from issue of share capital Right issue expenses Proceeds from borrowings Dividend paid

Net Cash used in Financing Activities Total (C)

Net Changes in Cash & Cash equivalent (A+B+C) Cash & Cash equivalent - Opening Balance Add : Transferred as per Scheme of Arrangement (See note 2 of Schedule 18) Cash & Cash equivalent - Closing Balance

Year ended March 31,2002 Rs.

1,99,27,368 2,088

— 1,92,52,364

25,93,479 14,92,846

2,35,55,050

Rs.

79,19,296

3,91,81,820

4,71,01,116

2,76,41,375

7,47,42,491 -1,92,52,364

-2,50,000

5,52,40,127 -25,47,758

5,26,92,369

-93,45,447 44,486

— 56,350

4,19,727 —

-88,24,884

— —

-3,80,42,512 —

-3,80,42,512

58,24,973 10

1,21,93,106 1,80,18,089

Notes 1. Increase/Decrease in the items of Balance Sheet have been arrived at by deducting from the balances of relevant items as at

31st March, 2002, the balances as of the respective items as of 31st March, 2001 as adjusted for the transfers pursuant to the Scheme of Arrangement referred to in note 2 of Schedule 18 to the accounts.

2. The transfer of Ceramic Division to the Company and Equity Shares issued in consideration thereof during the year as stated in note 2 of Schedule 18 to the accounts is the non-cash transaction.

3. The previous year figures are not comparable in view of the matters as stated in note no. 1 above.


T. T. Patel Company Secretary

Vikram Somany S. C. Kothari

Chairman Director

D. P. Goyal S. A. Trivedi

Director Director

We have verified the above cash flow statement of Madhusudan Oils and Fats Limited derived from the audited annual financial statements for the years ended March 31, 2002 and March 31, 2001 and found the same to be in accordance therewith and also with the requirements of Clause 32 of the listing agreement with Stock Exchange(s).

Auditors' Certificate

As per our report of even date attached

For and on behalf of H. V. Vasa & Co.

Chartered Accountants


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Annual Report 2001-2002 Madhusudan Oils And Fats Limited

Documents

Transcript of Annual Report 2001-2002 Madhusudan Oils And Fats Limited