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Pranavaditya Spinning Mills Ltd. Annual Report 2012-13

Pranavaditya Spinning Mills Ltd. 301, ‘Arcadia’, Nariman Point,

Mumbai-400021, India.E-mail - [email protected]

www.indocount.com

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20

22 Notes forming part of Accounts

Profit & Loss Account

18 Balance sheet

1907 Report of Corporate Governance

14 Auditors’ Report

Cash Flow Statement

02 Notice

04 Directors’ Report

Contents

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Pranavaditya Spinning Mills Ltd.Annual Report 2012-13

Board of Directors Audit Committee

S. K. Agrawal S. K. Agrawal – Chairman Chairman R. Anand Anil Kumar Jain P. N. Shah Kamal Mitra Kamal Mitra P. N. Shah Shareholders’ & R. Anand Investors’ Grievances Committee Company Secretary D. V. Kulkarni Anil Kumar Jain – Chairman Auditors S. K. Agrawal B. K. Shroff & CompanyChartered Accountants Kamal Mitra 3/7-B, Asaf Ali RoadNew Delhi 110 002 Share Transfer Committee

Anil Kumar Jain – ChairmanRegistered Office Office No. 2, Village Alte S. K. AgrawalTaluka Hatkanangale Dist. Kolhapur 416 109 Kamal Mitra Registrar & Share Transfer AgentM/s Big Share Services Pvt. Ltd. Remuneration CommitteeE-2-3/Ansa Industrial Estate Saki Vihar Road R. Anand – ChairmanSaki Naka, Andheri (East)Mumbai 400 072 P. N. Shah S. K. Agrawal

CORPORATE INFORMATION


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NOTICE IS HEREBY GIVEN THAT the 23rd Annual General

Meeting of the Company will be held as scheduled below:

Day : Saturday,

Date : the 20th July, 2013

Time : at 11.00 a.m.,

Place: at the Registered Office of the Company at Office No

2, Village Alte, Taluka Hatkanangale,

Dist. Kolhapur 416 109, Maharashtra to transact the

following business:

AS ORDINARY BUSINESS1. To consider and adopt the Profit & Loss Account of the

Company for the Financial Year ended 31-03-2013, the

Balance Sheet as at that date and the Report of Directors’

and Auditors’ thereon.

2. To elect a Director in place of Mr. Anil Kumar Jain, who

retires by rotation and being eligible offers himself for re-

appointment.

3. To elect a Director in place of Mr. R. Anand, who retires by

rotation and being eligible offers himself for re-appointment.

4. To appoint Auditors to hold office from the conclusion of this

Annual General Meeting until the conclusion of next Annual

General Meeting and to fix their remuneration.

By Order of the Board D V KulkarniMumbai, 24th May 2013 Company Secretary

Additional information: As required in terms of Para VI (A) of Clause 49 of the Listing AgreementBrief profile of Mr Anil Kumar Jain, who retires by rotation and is eligible for re-appointment.Mr. Anil Jain has rich experience in Textiles and Finance for more

than 38 years. Mr Jain has been on the Board of the Company

since 31st July 2007.

Outside Directorship: 1) Indo Count Industries Ltd. 2) Margo

Finance Ltd. 3) Sarla Performance Fibers Ltd.

Committee Chairmanship/Membership:Name of the

CompanyShare

Transfer Committee

Investors Grievance Committee

Remuneration Committee

Indo Count Industries Ltd

Chairman Chairman ---

Margo Finance Ltd

Chairman Chairman ---

Pranavaditya Spinning Mills Ltd

Chairman Chairman ----

Sarla Performance Fibers Ltd

-- -- Member

Brief profile of Mr R. Anand, who retires by rotation and is eligible for re-appointment1. Mr R Anand, is a Science graduate and is associated with

Textile industry for about 44 years. Mr Anand is on the Board

of the Company since 31st July 2007.

Outside Directorship : 1) Eastern Engineering Co. (Bombay)

Pvt Ltd. 2) Nova Silk Pvt. Ltd. 3) NCL Industries Ltd. 4) ETS

Eastern Services Pvt. Ltd. 5) NSL Textiles Ltd. 6) Indo count

Industries Ltd. 7) Marzoli Textile Machinery Manufacturers

Pvt. Ltd. 8) Ferrari Eastern Fans India Pvt. Ltd. 9) Smit Textile

Machinery Manufacturers Pvt. Ltd.

Committee Chairmanship/Membership :

Name of the Company

Audit Committee

Remuneration Committee

Management Committee

Indo Count Industries Ltd.

Member Chairman --

Pranavaditya Spinning Mills Ltd.

Member -- --

NSL Textiles Ltd. Member -- --

By Order of the Board

D V Kulkarni Mumbai 24th May 2013 Company Secretary

NOTICE

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1. A MEMBER ENTITLED TO ATTEND AND VOTE AT THE MEETING IS ENTITLED TO APPOINT A PROXY TO ATTEND AND

VOTE INSTEAD OF HIMSELF AND THE PROXY NEED NOT BE A MEMBER OF THE COMPANY.

The proxy form should be deposited at the Registered Office of the Company not later than 48 hours before the commencement

of the aforesaid Meeting.

2. Members/Proxies should bring the attendance slip duly filled in for attending the aforesaid meeting.

3. Register of Members and the Share Transfer Books of the Company will remain closed from 18-07-2013 to 20-07-2013 (both

days inclusive).

4. Members are requested to:

(i) intimate, changes, if any, in their Registered Addresses immediately;

(ii) intimate about consolidation of folios if shareholdings are under multiple folios;

(iii) quote ledger Folio No./DPID/Client ID in all their correspondence; to the Company’s Registrar & Transfer Agent:-

M/s Big Share Services Pvt. Ltd.

E-2-3/Ansa Industrial Estate

Saki Vihar Road

Saki Naka, Andheri (East)

Mumbai 400 072

Telephone Nos 022 – 40430200

Fax No 022 – 28475207

5. MEMBERS ARE ADVISED TO SEND ALL SHARE TRANSFERS AND RELATED CORRESPONDENCE TO THE REGISTRAR AND SHARE TRANSFER AGENT AT THE ABOVE ADDRESS.

6. Shareholders intending to require information about accounts to be explained in the Meeting are requested to inform the

Company at least 7 days in advance of the Annual General Meeting.

By Order of the Board

D V KulkarniMumbai, 24th May 2013 Company Secretary

NOTES :


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Your directors are pleased to present the TWENTY THIRD ANNUAL REPORT together with the audited financial statements and

auditors’ report for the financial year ended 31st March 2013.

(` in Lacs)Financial Results Current Year Previous Year changeRevenue 6076.30 4,774.29 27%1. EBIDTA 509.73 (215.70) 236%2. Less: Interest 34.39 32.873. Cash Profit 420.84 (248.57)Less: Depreciation 39.56 57.734. Profit before tax 435.71 (306.29) 142%5. Provision for Taxation 147.79 95.396. Net Profit/(loss) After Taxation 287.99 (210.90)

DividendYour Directors intend to plough back available resources for financial requirements and express their inability to recommend any dividend for the year under review.PERFORMANCE REVIEWDuring the year under review, the Company has achieved a revenue of about ` 61 crores as against about ` 48 crores in the previous year, thereby registering a growth of over 27%. EBIDTA during the above period stands increased from about ` (2.16) crores to about ` 5.10 crores, a growth of over 236%.Business OutlookCotton yarn manufacturers to benefit from slow but steady pick- up in International/domestic demand and likely higher demand of cotton yarn from China and improving margins on account of low cotton prices and firm cotton yarn prices. Stability in cotton prices will enable spinning mills to better plan the inventory buying. However, spinners in Southern India and Gujarat continue to under utilise capacity due to power shortage or incur high cost of self-generated power.With the recovery in the US and European economies, the International Market for your Company’s product will be cheered up in the years to come.The prices of raw cotton and yarn have started scaling up, which augurs well for the industry.Considering the better prospects for the Textile business, your Company has increased production capacities. The Company is scouting for Term Loan facility to expand the spindlage to take advantage of the situation for Indian Textile Industry.

Management Discussion and AnalysisIndustry structure and developmentsTextile Industry in India ranks next to Agriculture and is major source of employment in the subcontinent. It caters the basic necessity of civilized society and at the same time also contributes in a large ratio to Indian economy. World-wide, Indian textile products are well accepted and appreciated. India being one of the known natural fiber producing country, it is an advantage for Indian textile organizations.The textile industry occupies a unique place in our country. One of the earliest to come into existence in India, it accounts for 14% of the total Industrial production, contributes to nearly 30% of the total exportsThe Indian spinning industry enjoys a predominant position in the domestic and international yarn trade. With about 41 mn. Spindles, this segment of the textile industry, is still expanding and modernizing itself, being the single largest beneficiary under the Technology Upgradation Scheme of the Government of India.Most of the Textile Mills are in the organized sector with medium and large scale units. Considering the advantage of strong raw material base, alongwith availability of skilled manpower, the spinning units are efficiently run and thus compete very well in terms of cost of production with the global players.During the year under review, besides, catering to the ever growing domestic market, your Company, has exported about 55% of its Sales.Your company has been in the carded yarn business and has established a name in the domestic market. The facilities at the unit have been streamlined and aligned to produce the best quality of yarns at competitive costs. The unit has moved in to higher value addition by producing finer counts of carded yarn.

DIRECTORS’ REPORT

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Opportunities and threatsDue to moderate economic conditions prevailed globally, the domestic market had also faced slump in demand for cotton yarn. Despite this, during the year under review, the sales grew by about 27% over that of the previous year.Beijing is now focusing on high-value products instead of spinning yarn, opening up a huge window for Indian suppliers of the raw material, and raising hopes of even the apparel industry in India, industry officials say.Yarn imports by China in January this year increased substantially. The year 2013-14 will be good for spinning mills as China is going to depend more on India for yarn supply. Nearly 75-80% of yarn produced in India is now going to China. Spinning Mills/Cotton spinners in Tamil Nadu, Andhra Pradesh, Punjab and Gujarat are flooded with orders for yarn from China. Yarn imports in China, unlike raw cotton, are free from quota limits and cost about $160 per tonne less in the country.Looking at the potential growth of Cotton Yarn Market, Company proposes to undertake expansion to optimize its Production. Steps will be taken at appropriate time to enhance the capacity to take advantage of this situation.Risks and concernsCotton production depends on the vagaries of monsoon. Procurement of raw material at right prices is the key to yarn prices remaining cost competitive.Availability of term loan facilities for expansion purpose and working capital facilities to further strengthen its operations, is of paramount importance in the time to come.Timing and efficiency of cotton buying, receivables and inventory management would continue to be key liquidity determinants in 2013. In 2012, many of spinning units that overused their working-capital limits and/or delayed debt servicing due to liquidity stress. Leverage indicators are weak, yet better than 2008-2009 slowdown, when companies were in midst of capex cycle and high on debt.1. OutlookA stable outlook on cotton textiles would require favourable policy environment, improvements in demand-supply position, continued stability in input costs and consequent improvement in margins/liquidity. It is unlikely that the sector’s outlook will turn positive until fundamental issues such as power shortage, lack of technology and modern machinery and demand slowdown are resolved. However foreign direct investment (FDI) in retail is an opportunity that would unleash demand in the long run and offset any slowdown in exports.The cotton outlook could be revised to negative if input costs turn volatile, which could intensify inventory price risks, cash flows and liquidity. Given the sector’s high debt dependence

for operational as well as capex needs, any volatility in EBITDA could lead to huge swings in leverage.There is spurt in demand for cotton yarn both in domestic and international markets, of late, and as a result, yarn prices have started looking up. Overall outlook for the Textile Industry continues to be promising.SegmentThe company is engaged only in one segment i.e. Textiles.Internal control systems and their adequacyThe company has in place an elaborate internal control system to ensure proper authorization and accounting of transactions as also for safeguarding and protecting company’s assets against loss. The internal auditors check the controls periodically and their report is reviewed by the management and the Audit Committee from time to time. The management feels that the system of internal controls is adequate considering the size of operations of the company.Human ResourcesDuring the year, labour relations continued to be cordial.Particulars of employees in accordance with the provisions of Section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, as amended, are not given, as none of the employees qualify for such disclosure.Corporate GovernanceThe corporate governance report together with a certificate from the Company’s auditors confirming compliance of guidelines are made part of this Report as per clause 49 of the listing agreement entered into with the Stock Exchanges.Directors’ Responsibility StatementPursuant to the requirement under section 217 (2AA) of the Companies Act, 1956, with respect to Directors’ Responsibility Statement, it is hereby confirmed:• that in the preparation of the accounts for the financial

year ended on 31st March 2013, the applicable accounting standards have been followed and there are no material departures.

• that the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the Profit of the Company for the year under review.

• that the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.


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• that the Directors have prepared the annual accounts ended on 31st March 2013 on a ‘going concern’ basis.

DirectorsIn accordance with the provisions of the Companies Act, 1956, Mr. Anil Kumar Jain and Mr. R. Anand, retire by rotation and being eligible, offer themselves for reappointment.AuditorsM/s. B K Shroff and Co., Chartered Accountants retire at the end of this Annual General Meeting and are eligible for reappointment as auditors.Conservation of Energy, Technology Absorption & Foreign Exchange Earning & OutgoStatement required under the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 is given in Annexure “A” forming part of this Report.AcknowledgementsYour directors are grateful to the customers, suppliers and employees for their Co-operation and assistance during the year under review.

Cautionary StatementStatements in the Management Discussion and Analysis describing the Company’s objectives, projections, estimates, expectations may be ‘forward-looking statements’ within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could influence the Company’s operations include economic developments outside the country, global demand and supply conditions in the industry, input prices, changes in government regulations, tax laws and other factors such as litigation and industrial relations.

On behalf of Board of Directors ANIL KUMAR JAINMumbai, 24th May 2013 DIRECTOR

ANNEXURE AInformation Under Section 217(1)(e) of the Companies Act, 1956 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 financial year ended on 31st March 2013.A. CONSERVATION OF ENERGYForm - AForm for Disclosure of particulars with respect to conservation of energy

Particulars Current Year Previous Yeara) Power and Fuel ELECTRICITY a) Purchased (Units) 12,053,640 104,50,260 Total amount ` in Lac 881.42 680.57

Rate/unit ` 7.31 6.51 b) Own generation: i) through diesel generator Unit Nil Nil Unit/liter of diesel oil Nil Nil Cost per unit NA NA ii) Furnace oil Quantity (KL) -- -- Amount ` in Lac -- --

Average Rate (`) -- --b) Electricity consumption per

unit of production of yarn per Kg.

3.97 3.84

B. TECHNOLOGY ABSORPTIONForm - BTechnology Absorption, Adaptation and Innovation1. Specific areas in which R & D was carried by the

Company:- Nil2. Benefit derived from above R & D activities - Nil3. Future plan of action.

Search for improvement/betterment in products and systems will continue in order to reduce production costs.

D. Expenditure on R & D(i) Separate account for R&D expenses is not maintained.(ii) Expenditure is charged to profit and loss account like

other heads.2. Technology absorption, adaptation and innovation The Company has not imported any technology since inception.C. FOREIGN EXCHANGE EARNINGS AND OUT-GO

1) Activity related to initiatives taken to increase export markets for products and services and export – The company product is entirely sold in the local market.

2) Total foreign exchange used and earned (` in Lacs)

Particulars 2012-13 2011-12Used 42.47 18.96Earned (FOB value of export goods) 3,377.91 1984.81

On behalf of Board of Directors

ANIL KUMAR JAIN MUMBAI, 24TH MAY 2013 DIRECTOR

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1. COMPANY’S PHILOSPHY ON CODE OF CORPORATE GOVERNANCE

Philosophy

Your Company is committed to excellence in Corporate

Governance practice and recognizes that good Corporate

Governance is a continuous exercise. Your Company

aims at achieving transparency, accountability, equity and

ethics in all facets of its operations and in all interaction

with its stakeholders. Your Company believes that all its

operations and actions must result in enhancement of

overall shareholder value over a sustained period of time

without compromising in any way compliance with laws and

regulations.

Status of Compliance

Your Company has been able to make significant

compliance with the revised provisions of Clause 49 of the

Listing Agreement.

2. BOARD OF DIRECTORS a) Composition of the Board

The Company has presently 5 directors and the Chairman is a Non-Executive Director. Other four are also Non-Executive Directors and of these three are Independent Directors.

The Board of Directors meet at least once a quarter to review the Company’s performance and financial results and more often, if considered necessary, to transact other important business.

b) Number of Board meetingsDuring the current accounting year ended 31st March 2013, 4 Board Meetings were held on the following dates viz. 23-05-2012, 14-08-2012, 08-11-2012 and 12-02-2013.

The maximum interval between any two Board Meetings was less than 4 months as stipulated in Clause 49 of the Listing Agreement.

The 22nd Annual General Meeting was held on 25-082012.

c) Directors attendance record and directorship held as under:

Name of the Director

Designation Category During the period No. of Board

Meetings

Whether attended last AGM

Directorship in other

Public Limited Companies

incorporated in India

Overall Committee Membership/

Chairmanship across Directorship

NON EXECUTIVE Held Attended Chairman MemberMr. S. K. Agrawal Chairman Independent 4 4 Yes 1 2 4Mr. Anil Kumar Jain Director Promoter 4 3 Yes 3 3 4Mr. Kamal Mitra Director Non-

Independent4 4 Yes 1 -- 3

Mr. P N Shah Director Independent 4 3 No 7 4 6Mr. R Anand Director Independent 4 2 No 3 0 3

REPORT ON CORPORATE GOVERNANCE


8

The Board has lay down and adopted Code of Conduct for

all Board Members and Senior Management personnel of the

Company.

No remuneration, other than sitting fees has been paid for

attending the Board/Committee meeting detailed as under:-

Name of Director Sitting FeesAmt `

Name of Director Sitting FeesAmt `

Mr. P. N. Shah 40,000/- Mr. S.K. Agrawal 45,000/-

Mr. R. Anand 25,000/- Mr. Anil Kumar Jain 15,000/-

Mr. Kamal Mitra 25,000/-

Chairmanship/Membership of every Director is within limits

specified.

d) Information supplied to the Board:

A detailed agenda is sent to each Director sufficiently in

advance of Board and Committee meetings. At every Board

meeting the Chairman briefs the members on the overall

performance of the company.

Apart from the matters statutorily requiring the Board

approval, all major decisions related to investments,

capital expenditure, modernization programs, mobilization

of resources and planning thereof are considered by the

Board.

As per SEBI’s code of Corporate Governance, the following

information is regularly placed before the Board:-

1. Annual operating plans and budgets and any updates.

2. Capital budgets and any updates.

3. Quarterly results for the company and its operating

divisions or business segments.

4. Minutes of meetings of audit committee and other

committees of the board.

5. The information on recruitment and remuneration of

senior officers just below the board level, including

appointment or removal of Chief Financial Officer and

the Company Secretary.

6. Show cause, demand, prosecution notices and penalty

notices which are materially important

7. Fatal or serious accidents, dangerous occurrences,

any material effluent or pollution problems.

8. Any material default in financial obligations to and by

the company, or substantial nonpayment for goods

sold by the company.

9. Any issue, which involves possible public or product

liability claims of substantial nature, including any

judgment or order which, may have passed strictures

on the conduct of the company or taken an adverse

view regarding another enterprise that can have

negative implications on the company.

10. Details of any joint venture or collaboration agreement.

11. Transactions that involve substantial payment towards

goodwill, brand equity, or intellectual property.

12. Significant labour problems and their proposed

solutions. Any significant development in Human

Resources/ Industrial Relations front like signing

of wage agreement, implementation of Voluntary

Retirement Scheme etc.

13. Sale of material nature, of investments, subsidiaries,

assets, which is not in normal course of business.

14. Quarterly details of foreign exchange exposures and

the steps taken by management to limit the risks of

adverse exchange rate movement, if material.

15. Non-compliance of any regulatory, statutory or listing

requirements and shareholders service such as non-

payment of dividend, delay in share transfer etc.

e) Independent Audit Committee:

The Company has constituted Audit Committee in

accordance with the requirements of Clause 49 of the Listing

Agreement with qualified, independent and non-executive

members of the Board of Directors of the Company. The

broad terms of reference of the Audit Committee are:-

1. Oversight of the company’s financial reporting process

and the disclosure of its financial information to ensure

that the financial statement is correct, sufficient and

credible.

2. Recommending to the Board, the appointment, re-

appointment and, if required, the replacement or removal

of the statutory auditor and the fixation of audit fees.

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3. Approval of payment to statutory auditors for any other

services rendered by the statutory auditors.

4. Reviewing, with the management, the annual financial

statements before submission to the board for

approval, with particular reference to:

a. Matters required to be included in the Director’s

Responsibility Statement to be included in the

Board’s report in terms of clause (2AA) of section

217 of the Companies Act, 1956

b. Changes, if any, in accounting policies and

practices and reasons for the same

c. Major accounting entries involving estimates

based on the exercise of judgment by

management

d. Significant adjustments made in the financial

statements arising out of audit findings

e. Compliance with listing and other legal

requirements relating to financial statements

f. Disclosure of any related party transactions

g. Qualifications in the draft audit report.

5. Reviewing, with the management, the quarterly financial

statements before submission to the board for approval

5A. Reviewing, with the management, the statement of uses /

application of funds raised through an issue (public issue,

rights issue, preferential issue, etc.), the statement of

funds utilized for purposes other than those stated in the

offer document/prospectus/notice and the report submitted

by the monitoring agency monitoring the utilisation of

proceeds of a public or rights issue, and making appropriate

recommendations to the Board to take up steps in this

matter.

6. Reviewing, with the management, performance of statutory

and internal auditors, adequacy of the internal control

systems.

7. Reviewing the adequacy of internal audit function, if any,

including the structure of the internal audit department,

staffing and seniority of the official heading the department,

reporting structure coverage and frequency of internal audit.

8. Discussion with internal auditors any significant findings

and follow up there on.

9. Reviewing the findings of any internal investigations by

the internal auditors into matters where there is suspected

fraud or irregularity or a failure of internal control systems

of a material nature and reporting the matter to the board.

10. Discussion with statutory auditors before the audit

commences, about the nature and scope of audit as well

as post-audit discussion to ascertain any area of concern.

11. To look into the reasons for substantial defaults in the

payment to the depositors, debenture holders, shareholders

(in case of non payment of declared dividends) and

creditors.

12. To review the functioning of the Whistle Blower mechanism,

in case the same is existing.

12A. Approval of appointment of CFO (i.e., the whole-time

Finance Director or any other person heading the finance

function or discharging that function) after assessing

the qualifications, experience & background, etc. of the

candidate.

13. Carrying out any other function as is mentioned in the terms

of reference of the Audit Committee.

The Audit Committee comprises 4 Non-executive Directors

of which 3 are independent and 1 is Non-independent viz.

Mr. S.K. Agarwal, Mr. P N Shah Mr. R Anand and Mr. Kamal

Mitra.

The Audit Committee meetings are attended by Internal

Auditors. Statutory/Cost Auditors are invited as and when

required by the Committee.

The Chairman of the Committee Mr. S K Agarwal, a Non-

Executive, Independent Director, is a Chartered Accountant

by profession.

5 Audit Committee meetings were held during the current

accounting year ended 31st March, 2013, on the following

dates viz: 17-05-2012, 24-05-2012, 21-09-2012, 21-11-

2012 and 30-01-2013. The attendance of each member is

as under:-


10

Name of the Member

Position No meetings

Held Attended

Mr. S. K. Agrawal Chairman 5 5

Mr. Kamal Mitra Member 5 1

Mr. P. N. Shah Member 5 5

Mr. R. Anand Member 5 3

f) Remuneration Committee:

Though the formation of the Remuneration Committee is

non-mandatory in nature, as a concern of good Corporate

Governance, the Board has constituted Remuneration

Committee at its meeting held on 11th May 2010. The

present Remuneration Committee comprises 3 independent

and non-executive members of the Board of Directors

of the Company. The broad terms of reference of the

Remuneration Committee are:-

• To frame a remuneration policy and consider specific

remuneration package for its executive directors

including pension rights and compensation payments.

• To review remuneration policy and remuneration paid

to the executive directors from time tot time.

• To approve the remuneration paid/payable to the

executive directors as require by the Companies Act,

1956 and/or Listing guidelines.

Composition:

The Committee comprises 3 Non-Executive, independent

members of the Board of Directors, viz

Name of Member Position

Mr. S. K. Agrawal Chairman

Mr. R. Anand Member

Mr. P. N. Shah Member

No Remuneration Committee Meetings were held during the

year under review.

No remuneration, other than sitting fees for attending the Board/

Committee meetings, is paid to the non-executive directors.

g) Investors’ Grievance Committee/Shareholders’

Committee:

The Board has constituted the “Shareholder/Investor

Grievances Committee” in accordance with the requirements

of the Clause 49 of the Listing Agreement. The objective

of the Committee is to attend to the investors’ complaints

pertaining to transfer/transmission/demat/remat of shares,

on receipt of dividend warrants/share certificates etc and

any other matter related thereto.

The committee functions under the Chairmanship of MR Anil

Kumar Jain. The other members are Mr. S.K. Agrawal and

Mr. Kamal Mitra. The Committee meets once in a quarter.

h) Compliance Officer:

Mr. D V Kulkarni, the Company Secretary has been

designated as Compliance Officer.

Status of the Complaints received for the period 1st April

2012 to 31st March 2013 is as under:-

Sr No

Nature of Complaint

Number of complaints

Received Resolved

SEBI Others SEBI Other

1 Non receipt of share certificates

NIL NIL NA NA

2 Non receipt of dividend warrants

NIL NIL NA NA

3 Non receipt of annual reports

NIL NIL NA NA

4 Revalidation of dividend warrants

NIL NIL NA NA

5 Stop transfer NIL NIL NA NA

6 Demat/Remat of share certificates

NIL NIL NA NA

7 Loss of share certificates

NIL NIL NA NA

i) Share Transfer Committee:

The board has also constituted Share Transfer Committee

comprising three directors viz. Mr. Anil Kumar Jain, Mr. S.K.

Agarwal and Mr. Kamal Mitra and Committee is chaired by

Mr. Anil Kumar Jain.

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3. MANAGEMENT a) Management Discussion and Analysis:

Management Discussion and Analysis forms part of

the Directors’ Report.

b) Disclosure by the management to the Board:

All details relating to financial and commercial

transactions where Director may have a potential

interest are disclosed to the Board, and the interested

Directors neither participate in the discussions, nor do

they vote on such matters.

4. SHAREHOLDERS a) Annual General Meetings:

Details of General Meetings of the shareholders are as

under:-

Year AGM/EGM

Location Date Time

2010-11 AGM Village Alte, Tal. Hatkanangale, PB No 3, Kolhapur 416 109

31-07-2010 11.45 a.m.

2011-12 AGM -- do -- 02-08-2011 11.45 a.m.

2012-13 AGM -- do -- 25-08-2012 11.30 a.m.

There were no special resolutions passed by the

Company through postal ballot during 2012-13.

b) Disclosures:

I) Disclosure on materially significant related

transactions i.e. transaction of the Company of

material nature, with its promoters, the directors

or the management, their subsidiaries or relatives,

etc. that may have potential conflict with the

interests of the Company at large:

There is no material transaction with any related arty

which may have potential conflict with the interests of

the Company at large. However, the Company has

annexed to the accounts, a list of related parties as

per the Accounting Standard 18 and the transactions

entered into with them.

II) Disclosure of accounting treatments, if different

from that prescribed in Accounting Standards with

explanation:

All the accounting treatments made are in consonance

with Accounting Standards.

III) Details of non-compliance by the Company,

penalties, strictures imposed on the Company

by Stock Exchanges or SEBI or any statutory

authority, on any matter related to capital markets,

during the last three years:

Neither any non-compliance with any of the legal

provisions been made by the Company nor has any

penalty , stricture has been imposed by the stock

exchange or SEBI or any statutory authority, on any

matter related to capital market, during the last three

years.

IV) Whistle Blower policy and affirmation that no

personnel has been denied access to the Audit

Committee:

The Company does not have whistle blower policy, as

the same is not mandatory in nature.

c) Means of Communication:

The Company is publishing its financial results in

leading newspapers viz. Free Press Journal and Nav

Shakti, on a quarterly basis.

The Annual Report is posted to every shareholder of

the Company.

The Company has not made any presentation to the

institution, investors/analysts.

MDA is part of the Directors’ Report.


12

d) General Shareholders’ Information:

Annual General Meeting:

Day, Date, Time and Venue Saturday, the 20th July 2013, at 11.00 a.m., at the Registered Office of the Company at Office no-2, Village Alte, Taluka Hatkanangale, Dist. Kolhapur 416 109, Maharashtra

Financial Calendar 2013-14

Financial reporting for the quarter ended 30-06-2013 Latest by Wednesday the 14-08-2013

Financial reporting for the quarter ended 30-09-2013 Latest by Thursday the 14-11-2013

Financial reporting for the quarter ended 31-12-2013 Latest by Friday the 14-02-2014

Financial reporting for the quarter ended 31-03-2014 Latest by Friday the 30-05-2014

Book closure dates 18-07-2013 to 20-07-2013 (both days inclusive)

Listing on the Stock Exchange The equity shares of the Company are listed on the Bombay. The Company has paid the listing fees to The Bombay Stock Exchange for the period from 01-04-2013 to 31-03-2014

Address of the Stock Exchange The Bombay Stock Exchange, Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai 400 001Scrip code: 531172

Code in respect of company’s shares traded in a DEMAT form for both NSDL and CDSL : ISIN – INE569D01028

5. STOCK PRICE DATA FOR THE PERIOD FROM 01-04-2012 TO 31-03-2013

Month High (`) Low (`) Volume Index #

April 2012 10.90 10.90 1 17,318.81

May 2012 10.90 10.90 100 16,218.53

June 2012 12.50 10.80 104 17,429.98

July 2012 11.30 7.04 1,496 17,236.18

August 2012 8.14 6.13 8,513 17,429.56

September 2012 8.20 7.61 157 18,762.74

October 2012 8.10 6.41 15,221 18,505.38

November 2012 8.20 6.45 9,832 19,339.90

December 2012 7.50 6.11 4,440 19,426.71

January 2013 7.82 6.13 4,641 19,894.98

February 2013 7.68 6.66 1,248 18,861.54

March 2013 7.85 6.30 8,450 18,835.77

# Represents Sensex at the close of the last trading day of the month.

13


6. REGISTRAR & SHARE TRANSFER AGENT:M/s Big Share Services Pvt. Ltd.

E-2-3/Ansa Industrial Estate

Saki Vihar Road

Saki Naka, Andheri (East)

Mumbai 400 072

Telephone Nos 022 – 40430200

Fax No 022 – 28475207

Share Transfer system

Share Transfer Committee approves the transfer/transmission/split/consolidation/ remat/demat of share certificates at its

meeting held every fortnight till October 2012 and every week from November 2012.

7. DISTRIBUTION OF SHAREHOLDING AS AT 31-03-2012No. of equity shares No of Shareholders % of Shareholders No of shares held % of shareholding

Upto - 500 3661 93.08 173,662 0.91

501 – 1000 105 2.58 85,270 0.44

1001 – 2000 65 1.64 100,990 0.52

2001 – 3000 43 1.08 103,531 0.54

3001 – 4000 14 0.35 50,209 0.26

4001 – 5000 7 0.18 33,088 0.17

5001 – 10000 23 0.57 168,164 0.88

Above 10001 21 0.52 185,26,366 96.28

Total 3936 100.00 192,41,280 100.00

8. DEMATERIALISATION OF SHARES AND LIQUIDITY:As at 31st March 2013, 191,69,816 equity shares being 99.63% of total equity share capital is held in electronic mode with two

DPs viz. National Securities Depository Ltd (NSDL) and Central Depository Services Ltd (CDSL). The Company’s shares have

to be compulsorily traded in the electronic form. Requests for dematerialization of shares are processed and confirmed within

15 – 20 days if receipt to NSDL and CDSL.

9. OUTSTANDING ADRS/GDRS/WARRANTS/OTHER CONVERTIBLE INSTRUMENTS, CONVERSION DATE AND LIKELY IMPACT ON THE EQUITY:As at 31st March 2013, there is no outstanding ADRs/GDRs/Warrants/Other Convertible instrument which has impact on the

equity of the Company.

10. OTHER OFFICES OF THE COMPANY:

Registered Office and Works:Office no- 2, Village Alte, Taluka Hatkanangale, Dist Kolhapur 416 109 Maharashtra

Head Office301 and 1101, Arcadia, Nariman Point, Mumbai 400 021

New Delhi Office 506, Pragati Tower 26, Rajendra PlaceNew Delhi 110 008

For CommunicationMr. Anil Kumar Jain, Director, C/o Indo Count Industries Ltd., 301 and 1101, Arcadia, Nariman Point, Mumbai 400 021


14

Independent Auditors’ ReportTo

The Members of

Pranavaditya Spinning Mills Limited

Report on the Financial StatementsWe have audited the accompanying financial statements

of Pranavaditya Spinning Mills Limited (“the Company”)

which comprise the Balance Sheet as at 31 March 2013,

the Statement of Profit and Loss and Cash Flow Statement

for the year then ended and a summary of significant

accounting policies and other explanatory information.

Management’s responsibility for the Financial Statements

Management is responsible for the preparation of these

financial statements that give a true and fair view of

the financial position, financial performance and cash

flows of the Company in accordance with the Accounting

Standards referred to in sub-section (3C) of section 211

of the Companies Act, 1956 (“the Act”). This responsibility

includes the design, implementation and maintenance of

internal control relevant to the preparation and presentation

of the financial statements that give a true and fair view and

are free from material misstatement, whether due to fraud

or error.

Auditor’s responsibility

Our responsibility is to express an opinion on these financial

statements based on our audit. We conducted our audit in

accordance with the Standards on Auditing issued by the

Institute of Chartered Accountants of India. Those standards

require that we comply with ethical requirements and plan

and perform the audit to obtain reasonable assurance about

whether the financial statements are free from material

misstatement.

An audit involves performing procedures to obtain audit

evidence about the amounts and disclosures in the financial

statements. The procedures selected depend on the

auditor’s judgment, including the assessment of the risks of

material misstatement of the financial statements, whether

due to fraud or error. In making those risk assessments, the

auditor considers internal control relevant to the Company’s

preparation and fair presentation of the financial statements

in order to design audit procedures that are appropriate

in the circumstances. An audit also includes evaluating

the appropriateness of accounting policies used and the

reasonableness of the accounting estimates made by

management, as well as evaluating the overall presentation

of the financial statements.

We believe that the audit evidence we have obtained is

sufficient and appropriate to provide a basis for our audit

opinion.

Opinion

In our opinion and to the best of our information and according

to the explanations given to us, the financial statements

give the information required by the Act in the manner so

required and give a true and fair view in conformity with the

accounting principles generally accepted in India:

a) In the case of the Balance Sheet, of the state of affairs

of the Company as at 31 March 2013;

b) In the case of the Statement of Profit and Loss, of the

Profit for the year ended on that date; and

c) In the case of the Cash Flow Statement, of the cash

flows for the year ended on that date.

Report on Other Legal and Regulatory requirements

1. As required by the Companies (Auditor’s Report) Order,

2003 (“the Order”), issued by the Central Government of

India in terms of sub-section (4A) of section 227 of the

Act, we give in the Annexure a statement on the matters

specified in paragraphs 4 and 5 of the Order.

2. As required by section 227(3) of the Act, we report that:

(i) 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;

(ii) 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;

(iii) The Balance Sheet, Statement of Profit and Loss and

Cash Flow Statement dealt with by this Report are in

agreement with the books of account;

15


(iv) In our opinion, the Balance Sheet, Statement of Profit

and Loss, and Cash Flow Statement comply with the

Accounting Standards referred to in sub-section (3C)

of section 211 of the Act; and

(v) On the basis of written representation received from

the directors as at 31 March 2013 and taken on record

by the Board of Directors, none of the directors is

disqualified as at 31 March 2013, from being appointed

as a director in terms of clause (g) of sub-section (1) of

section 274 of the Act.

For B.K.Shroff & Co.Chartered Accountants

Reg. No. : 302166E

O.P. Shroff Partner

Mumbai, 24 th May 2013 Membership Number 6329

Annexure to Independent Auditors’ ReportAnnexure referred to in paragraph (1) under the heading of “Report on Other Legal and Regulatory requirements” of our report of even date(i) (a) The company has maintained proper records showing

full particulars including quantitative details and

situation of fixed assets.

(b) All the fixed assets have been physically verified by

the management according to a regular program,

which, in our opinion, is reasonable having regard to

the size of the company and the nature of its assets.

No material discrepancies with respect to book records

were noticed on such verification.

(c) During the year, the company has not disposed off any

substantial part of its fixed assets. Therefore, it has

not affected the going concern concept of the company

(ii) (a) Physical verification of inventory (except material in

transit) has been conducted by the management at

reasonable intervals. In our opinion, the frequency of

verification is reasonable.

(b) The procedures of physical verification of inventory

followed by the management are reasonable and

adequate in relation to the size of the company and

nature of its business.

(c) The company is maintaining proper records of inventory.

Discrepancies noticed on verification of inventory as

compared to book records were not material

(iii) (a) According to the information and explanations given to

us, the company has not granted any loans during the

year to the parties covered in the register maintained

under section 301 of the Companies Act, 1956.

(b) The Company has not taken any loan, secured or

unsecured from companies, firms or other parties

covered in the register maintained under Section 301

of the Act.

(iv) In our opinion and according to the information and

explanations given to us, there are adequate internal control

procedures commensurate with the size of the company and

the nature of its business for the purchase of inventory and

fixed assets and for sale of goods and services. During the

course of our audit, no major weakness has been noticed in

the internal control system.

(v) Transactions that need to be entered in the register

maintained under section 301 of the Companies Act, 1956.

a. Based upon the audit procedures applied by us and

according to the information and explanations given

to us, we are of the opinion that the particulars of

contracts or arrangements referred to in section 301

of the Companies Act, 1956, have been entered in the

register required to be maintained under the section.

b. In our opinion and according to the information and

explanations given to us, the transactions made

in pursuance of such contracts or arrangements


16

entered in the register maintained section 301 of the

Companies Act, 1956 and exceeding the value of `

5,00,000/- in respect of any party during the year,

have been made at prices which are reasonable,

having regard to prevailing market prices at the

relevant time.

(vi) According to the information and explanation given to us,

the Company has not accepted any deposit from the public.

Therefore, the provisions of clause (vi) of the Order are not

applicable to the Company.

(vii) In our opinion, the company has an adequate internal audit

system commensurate with the size and the nature of its

business.

(viii) We have broadly reviewed the books of account maintained

by the company pursuant to the order made by the Central

Government for the maintenance of cost records under

section 209(1) (d) of the Companies Act, 1956 and we are

of the opinion that prima facie the prescribed accounts and

records have been made and maintained. However, we

have not made a detailed examination of such accounts

and records.

(ix) (a) The company is generally regular in depositing with

the appropriate authorities undisputed statutory dues

including provident fund, investor education and

protection fund, employees state insurance, income

tax, wealth tax, sales tax, service tax, custom duty,

excise duty, cess and other statutory dues applicable

to it.

(b) Dues on account of penalty levied by excise authorities

amounting to ` 1 lac for the earlier year have not been

deposited and appeal for the same is pending before

CESTAT. There are no dues in the nature of sales tax,

income tax, custom tax, wealth tax, excise duty and

cess which are disputed and outstanding.

(x) The Company has no accumulated losses as at 31st March,

2013. The company has not incurred any cash loss during

the financial year.

(xi) In our opinion and according to the information and

explanations given to us, the company has not defaulted

in repayment of dues to a financial institution or bank or

debenture holders.

(xii) According to the information and explanations given to us,

the company has not granted any loan and advance on the

basis of security by way of pledge of shares, debentures

and other securities.

(xiii) In our opinion, the company is neither a chit fund nor nidhi /

mutual benefit fund / society and hence clause (xiii) of the

Order is not applicable to the company.

(xiv) In our opinion, the company is not dealing in or trading in

shares, securities, debentures and other investments and

accordingly, the provisions of clause (xiv) of the Order is not

applicable to the company.

(xv) In our opinion, the company has not given guarantee for

loans taken by others from banks or financial institutions.

(xvi) The company has not obtained any fresh term loans during

the year under review. Accordingly, the provisions of clause

(xvi) of the Order are not applicable to the company.

(xvii) As per the information and explanations given to us and on

an overall examination of the Balance Sheet of company,

we are of the opinion that the company has not utilized

short-term funds for long term purposes.

(xviii)During the year the company has not made preferential

allotment of shares to parties and companies covered in the

register maintained under section 301 of the Act.

(xix) According to the information and explanations given to us,

the company has not issued debentures during the year.

(xx) According to the information and explanations given to us,

during the year the company has not raised any money by

public issue.

(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.


Reg. No. : 302166E

O.P. Shroff Partner


17


AUDITORS’ CERTIFICATE ON COMPLIANCE WITH THE CONDITIONS OF CORPORATE GOVERNANCE UNDER CLAUSE 49

OF THE LISTING AGREEMENT

To the shareholders of Pranavaditya Spinning Mills Ltd.

We have examined the compliance of conditions of corporate governance by Pranavaditya Spinning Mills Limited, for the year ended

on 31st March, 2013, as stipulated in clause 49 of the listing Agreement of the said Company with stock exchange in India.

The compliance of conditions of the corporate governance is the responsibility of the management. Our examination was Limited to

procedures and implementation thereof, adopted by the company ensuring the compliance of the conditions of corporate governance.

It is neither an audit nor an expression of opinion on the financial statements of the company.

In our opinion and to the best of our information and according to the explanations given to us, 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 is pending for a period exceeding 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.


Reg. No. : 302166E

O.P. Shroff Partner



18

NOTE As at 31.03.2013 As at 31.03.2012I EQUITY AND LIABILITIES

(1) SHAREHOLDERS’ FUNDS(a) Share Capital 2 192,412,800 192,412,800 (b) Reserves & Surplus 3 194,869,387 387,282,187 172,334,050 364,746,850

(2) NON-CURRENT LIABILITIES(a) Long-Term Borrowings 4 491,428 844,002 (b) Other Long-Term Liabilities 5 6,235,626 6,727,054 5,429,354 6,273,356

(3) CURRENT LIABILITIES(a) Short-Term Borrowings 6 14,065,596 32,015,741 (b) Trade Payables 7 35,531,933 42,980,293 (c) Other Current Liabilites 8 17,528,979 21,526,235 (d) Short Term Provisions 9 5,450,000 72,576,508 - 96,522,269

Total 466,585,749 467,542,475

II ASSETS(1) NON CURRENT ASSETS

(a) Fixed Assetsi) Tangible Assets 10 264,132,998 269,246,547 ii) Capital Work in Progress 11 - 264,132,998 - 269,246,547

(b) Non-Current Investments 12 15,504 15,504 (c) Deferred Tax Assets (Net) 13 43,443,471 58,218,032 (d) Long-Term Loans & Advances 14 7,154,456 50,613,431 6,842,749 65,076,285

(2) CURRENT ASSETS(a) Inventories 15 67,859,039 62,722,911 (b) Trade Receivables 16 40,487,332 43,516,416 (c) Cash & Cash Equivalents 17 7,948,631 8,916,841 (d) Short Term Loans & Advances 18 25,956,637 13,014,621 (e) Other Current Assets 19 9,587,681 151,839,320 5,048,854 133,219,643

Total 466,585,749 467,542,475 See accompanying notes to the financial statements

As per our report of even date annexed For B.K.SHROFF & CO., S. K. Agrawal Anil Kumar Jain Chartered Accountants Chairman Director Reg. No. 302166E

O.P. Shroff D.V. Kulkarni Partner Company Secretary Membership No. 6329 Mumbai, 24 th May 2013

BALANCE SHEET as at 31st March, 2013In `

19


PROFIT & LOSS STATEMENT For the year ended 31st March 2013

In `NOTE For the year ended

31st March 2013For the year ended

31st March 2012

I Revenue from Operations 21 607,620,818 477,429,353II Other Income 22 5,027,049 2,805,134

III TOTAL REVENUE 612,647,867 480,234,487

IV EXPENSESCost of Materials Consumed 23 371,845,224 355,360,886Purchases - Traded Goods 24 975,421 2,047,677Changes in Inventories of Finished Goods, Workin Progress and Stock in trade 25 2,769,506 7,323,948Employee Benefits Expense 26 54,020,830 41,962,241Finance Costs 27 3,439,362 3,287,215Depreciation and Amortisation Expense 28 3,955,485 5,772,625Other Expenses 29 132,063,741 95,109,114

TOTAL EXPENSES 569,069,569 510,863,706

V Profit before Tax 43,578,298 (30,629,218)

VI Tax Expense:Current tax 5,450,000 -Deferred tax 14,774,561 (9,538,522)MAT Credit Entitlement (5,444,909) -

VII Profit for the Year 28,798,646 (21,090,696)

VIII EARNING PER SHARE 32Basic and dilutive 1.50 (1.10)

See accompanying notes to the financial statements

As per our report of even date annexed For B.K.SHROFF & CO., S. K. Agrawal Anil Kumar Jain Chartered Accountants Chairman Director Reg. No. 302166E

O.P. Shroff D.V. Kulkarni Partner Company Secretary Membership No. 6329 Mumbai, 24 th May 2013


20

Particulars As at 31.03.2013 As at 31.03.2012

A. CASH FLOW FROM OPERATING ACTIVITIESNet Profit/(Loss) before extraordinary item and tax 43,578,298 (30,629,218)Adjustments for:-- Depreciation and amortisation 3,955,485 5,772,625

- Finance Cost 3,439,362 3,287,215- Interest income (805,737) (1,119,684)

Operationg profit /(loss) before working capital changes 50,167,408 (22,689,062)

- Changes in working capital :- Adjustment for (increase )/decrease in operating assets- Inventories (5,136,128) 19,508,009- Trade Receivables 3,029,084 3,701,370- Short term loan and advances (11,361,441) (3,944,463)- Long term loan advances (311,707) (2,120,850)- Other current assets 906,082 (5,048,854)

(12,874,110) 12,095,212- Adjustment for increase/(decrease) in operating liabilities- Trade payable (7,448,360) 24,733,271- Other current liabilities (3,997,255) 5,081,725- Other long term liabilities 806,272 (105,508)

(10,639,343) 29,709,488- Net income tax(paid)/refunds (1,580,574) (55,165)

Net Cash flow from /(used in) operating activities(A) 25,073,380 19,060,473

B CASH FLOW FROM INVESTING ACTIVITIESPurchase of tangible assets (5,105,246) (13,315,592)Interest Received - Others 805,737 1,119,684Net Cash flow from/(used in) investing activities( B) (4,299,509) (12,195,908)

C Cash Flow from financing activitiesNet increase/(Decrease) in long term borrowings (352,574) 1,072,383Net increase/(Decrease) in short term borrowings (17,950,145) (6,002,549)Proceeds from other short term borrowingsRepayment of other short term borrowings

Finance Cost (3,439,362) (3,287,215)Divident PaidTax on dividendCash flow from extraordinary items

CASH FLOW STATEMENT For The Year Ended as at 31st March, 2013In `

21


In `

Net Cash flow from /(used in) financing activities ( C) (21,742,081) (8,217,381)

Net Increase /(decreae) in cash and cash equivalents (A+B+C) (968,209) (1,352,816)Cash and cash equivalents at the beginning of the year 8,916,841 10,269,657Effect of exchange difference on restatement of foreigncurrency cash and cash equivalents - -Cash and cash equivalents at the end of the year 7,948,631 8,916,841Reconciliation of cash and cash equivalents with the balance sheet :Cash and cash equivalents as per Balance sheet 7,948,631 8,916,841

Cash and cash equivalents at the end of the year 7,948,631 8,916,841Comprises of:(a) cash on hand 14,546 11,703(b) cheque, draft on hand - -(b) balance with banks: i)In Current accounts 5,099,037 6,282,056(c) Others 2,835,048 2,623,082

Notes: Figures in bracket represents cash outflow.

As per our report of even date annexedFor B.K. SHROFF & CO., S. K. Agrawal Anil Kumar JainChartered Accountants Chairman DirectorReg. No. 302166E

O.P. Shroff D.V. Kulkarni

Partner Company Secretary

Membership No. 6329Mumbai, 24 th May 2013

Particulars As at 31.03.2013 As at 31.03.2012


22

1. Significant Accounting Policies adopted by the companyMethod of Accountingi) The accounts are prepared under the historical cost

convention using the accrual method of accounting

unless otherwise stated hereinafter.

ii) Use of Estimates The preparation of financial statements requires

estimates and assumptions to be made that affect the

reported amount of assets and liabilities on the date

of the financial statements and the reported amount

of revenues and expenses during the reporting period.

Difference between the actual results and estimates

are recongnised in the period in which the results are

known/ materialized.

iii) Accounting policies not significantly referred to

are consistent with generally accepted accounting

principles.

iv) Fixed Assets Fixed assets are stated at cost except for land, plant

& machinery and buildings which have been shown at

revalued amount. Cost is inclusive of inward freight,

duties & taxes and incidental expenses related to

acquisition. In respect of major projects involving

construction, related pre-operational, start-up and

trial run expenses form part of the value of the assets

capitalized. As per practice, expenses incurred on

modernization / debottlenecking/ relocation / relining

of plant & equipment are capitalized. Fixed assets,

other than leasehold land, acquired on lease are not

treated as assets of the company and lease rentals are

charged off as revenue expenses.

Consideration is given at each balance sheet date to

determine whether there is any indication of impairment

of the carrying amount of the company’s fixed assets. If

any indication exists, an asset’s recoverable amount is

estimated. An impairment loss is recognized whenever

the carrying amount of an asset exceeds its recoverable

amount. The recoverable amount is the greater of net

selling price and value in use. In assessing value in

use, the estimated future cash flows are discounted to their present value based on an appropriate discount factor.

v) Depreciation Depreciation is calculated on fixed assets on straight

line method in accordance with Schedule XIV to the Companies Act 1956. Software system is amortized over a period of five years.

vi) Investments Long term investments are stated at cost. Provision

for diminution in the value of long term investments is made only if such a decline is other than temporary in the opinion of the management.

Current investments are stated at lower of cost and quoted / fair value.

vii) Inventories Inventories are valued at lower of cost or net realizable

value except for waste. Cost is determined using the first-in-first-out (FIFO) basis. Finished goods and stock in process include cost of

conversion and other costs incurred in bringing the inventories to their present location and condition.

Wastage and rejections are valued at estimated realizable value.

Obsolete, defective and unserviceable stocks are duly provided for.

viii) Excise and other Duties Excise duty in respect of finished goods lying in factory

premises is provided and included in the valuation of inventiories. CENVAT benefit is

accounted for by reducing the purchase cost of the fixed assets.ix) Retirement and other employee related benefits i) Short term Employee Benefits

All employee benefits payable only within twelve months of rendering the service are classified as short-term employee benefits. Benefits such as salaries, wages etc. and the expected cost of bonus, exgratia, and incentives are recognized in the period during in which the employee renders

the related service.

NOTES ON ACCOUNTS For The Year Ended as at 31st March, 2013

23


ii) Post employment Benefits

a) Defined Contribution Plans

State Government Provident Fund

Scheme is a defined contribution plan. The

contribution paid/payable under the scheme

is recognized in the profit & loss account

during the period, in which the employee

renders the related service.

b) Defined Benefit Plans

Gratuity and Leave Encashment are

defined benefit plans. The present value of

obligation under such defined benefit plans

are determined based on actuarial valuation

under the projected unit credit method

which recognizes each period of service as

giving rise to additional unit of employees

benefits entitlement and measures each unit

separately to build up the final obligation.

The obligations are measured at the present

value of future cash flows. The discount

rates used for determining the present value

having maturity periods approximated to the

returns of related obligations.

x) Foreign Currency Transactions, Derivatives instruments and hedge accounting:

Transactions in foreign currency other than those

covered by forward contracts are accounted for at

the prevailing conversion rates at the close of the

year and difference arising out of the settlement are

dealt with in the Profit & Loss account. Outstanding

export documents when covered by foreign exchange

forward contracts are translated at contracted rates.

Other foreign currency current assets and liabilities

outstanding at the close of the year are valued at the

year end exchange rates. The fluctuations are reflected

under the appropriate revenue head.

The company uses foreign currency forward contracts

and currency options to hedge its risks associated with

foreign currency fluctuations relating to certain firm

commitments and forecasted transactions and not for

trading or speculation purpose.

xi) Research and Development

Revenue expenditure on research and development

is charged against the profit of the year in which

it is incurred. Capital expenditure on research &

development is shown as an addition to fixed assets.

xii) Earnings per share

Basic earning per share is calculated by dividing the net

profit for the period attributable to equity shareholders

by the weighted average number of equity share

outstanding during the year.

Diluted earning per share is calculated by dividing the

net profit attributable to equity shareholders by the

weighted average number of equity share outstanding

during the year (adjusted for the effects of dilative

options).

xiii) Borrowing Costs

Borrowing costs directly attributable to the acquisition,

construction or production of a qualifying asset

are capitalised as part of cost of that asset. Other

borrowing costs are recognized as an expense in the

period in which they are incurred.

xiv) Operating Leases

Operating lease payments are recognized as expense

in the profit & loss account on a straight-line basis over

the lease term.

xv) Events occurring after balance date

Events occurring after the balance sheet date have

been considered in the preparation of the financial

statements.

xvi) Contingent Liabilities

Contingent liabilities as defined in Accounting

Standard-29 are disclosed by way of notes to accounts.

Provision is made if it becomes probable that an

outflow of future economic benefit will be required for

an item previously dealt with as a contingent liability.


24

Schedules to the Balance Sheet as at 31st March, 2013

2. SHARE CAPITAL

Particulars No. of Shares Amount in `As at 31.03.2013 As at 31.03.2012 As at 31.03.2013 As at 31.03.2012

a) Authorised

Equity Shares of ` 10 eachAt the beginning of the period 19,270,000 19,270,000 192,700,000 192,700,000

At the end of the period 19,270,000 19,270,000 192,700,000 192,700,000

b) Issued, Subscribed and Paid up

Equity Shares of ` 10 eachAt the beginning of the period 19,241,280 19,241,280 192,412,800 192,412,800

At the end of the period 19,241,280 19,241,280 192,412,800 192,412,800

Terms/rights attached to equity shares(i) The Company has only one class of equity shares having a par value of ̀ 10 per share. Each holder of equity shares is entitled

to one vote per share, The company declares and pays dividends in Indian rupees. The dividend proposed by the Board of Directors is subject to the approval of the shareholders in the ensuing Annual General Meeting.

(ii) In the event of liquidation of the Company, the holders of equity shares will be entitled to receive remaining assets of the Company, after distribution of all preferential amounts: The distribution will be in proportion to the number of equity shares held by the shareholders.

Details of equity shares in the company held by each shareholder holding more than 5% of shares is as under:

Name of the Shareholder No. of SharesAs at 31.03.2013 percentage As at 31.03.2012 percentage

Indo Count Industries Limited (Holding company)

18,041,280 93.76% 18,041,280 93.76%

25


3. RESERVES & SURPLUSParticulars Amount in `

As at 31.03.2013 As at 31.03.2012

Capital ReserveAt the beginning of the period 2,500,000 2,500,000

At the end of the period A 2,500,000 2,500,000

Revaluation ReserveAt the beginning of the period 181,617,409 187,880,717

Less: Reduction during the period 6,263,309 6,263,308

At the end of the period B 175,354,100 181,617,409

Profit & Loss AccountAt the beginning of the period (11,783,359) 9,307,337

Add: Profit /(Loss) for the period 28,798,646 (21,090,696)

At the end of the period C 17,015,287 (11,783,359)TOTAL A+B+C 194,869,387 172,334,050

4. LONG TERM BORROWINGS

Particulars Amount in `As at 31.03.2013 As at 31.03.2012

SecuredHire purchase finance from banks * 491,428 844,002

Total 491,428 844,002

* Secured against hypothecation of Vehicle against under auto loan scheme.

Long Term Loans Repayment Schedule

Particulars Maturity Profile1-2 Years 2-3 Years

Rupee loansHire Purchase Finance 388,334 103,094

Total 388,334 103,094

5. OTHER LONG TERM LIABILITIESParticulars Amount in `

As at 31.03.2013 As at 31.03.2012

Employee Benefits 6,235,626 5,429,354

Total 6,235,626 5,429,354


26

6. SHORT TERM BORROWINGSParticulars Amount in `

As at 31.03.2013 As at 31.03.2012 Secured Loans repayable on Demand From Banks (a) Axis Bank Ltd Sangli - Cotton Pledge A/c - 13,903,015 Unsecured From Holding Company (including interest accured) 14,065,596 18,112,726 Total 14,065,596 32,015,741

(a) Secured against pledge of stock of cotton bales together with corporate - guarantee of the holding company M/s Indo Count Industries ltd.

7. TRADE PAYABLESParticulars Amount in `

As at 31.03.2013 As at 31.03.2012 Total outstanding dues of Micro Enterprises and Small Enterprises (a)

- -

Others (b) 35,531,933 42,980,293 Total 35,531,933 42,980,293

(a) The company has not received any intimation from suppliers regarding their status under the Micro, Small and Medium Enterprises Development Act, 2006 and hence disclosures, if any, relating to amounts unpaid as at the year end together with interest paid/payable as required under the said Act have not been given.

8. OTHER CURRENT LIABILITIESParticulars Amount in `

As at 31.03.2013 As at 31.03.2012Current Maturities of Long Term Debts 352,574 328,261Security Deposit 35,000 32,500Advance from Customers 35,023 56,940Other Payables (a, b) 17,106,382 21,108,534Total 17,528,979 21,526,235

(a) Amount to be credited to Investor Education & Protection Fund-


a) Unpaid Dividend - -b) Unpaid application money received for allotment of securities - - and due for refund - -c) Unpaid matured deposits - -d) Unpaid matured debentures - -e) Interest accrued on (a) to (d) above - -

(b) Includes amount payable to holding company ` 2,177,290 (Previous year ` 8,312,761)

9. SHORT TERM PROVISIONSParticulars Amount in `

As at 31.03.2013 As at 31.03.2012Provision for Income Tax 5,450,000 -

Total 5,450,000 -

27


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28

12. NON CURRENT INVESTMENTSParticulars No. of Shares Amount in `

As at 31.03.2013 As at 31.03.2012 As at 31.03.2013 As at 31.03.2012

-Unquoted

Shri Datta Nagari Sah Pat Sanstha Ltd 1,050 1,050 10,500 10,500

Choudeswari Co-op Bank Ltd. 200 200 5,004 5,004

Total 15,504 15,504

13. DEFERRED TAX ASSETSAs required under Accounting standard (AS-22), ‘Accounting for taxes on income’ issued by the Institute of Chartered Accounts of India, the Company is required to account for deferred taxation while preparing its accounts. The details of deferred tax assets / liabilities are as under:

Particulars Amount in `As at 31.03.2012 Tax effect for the period As at 31.03.2013

Deferred Tax liabilityFixed Assets (11,512,174) (1,906,580) (13,418,754)

A (11,512,174) (1,906,580) (13,418,754)Deferred Tax AssetsLoss 67,165,936 (13,691,255) 53,474,681Others 2,564,271 823,273 3,387,544

B 69,730,207 (12,867,982) 56,862,225Net Deferred Tax Assets/(Liability) A-B 58,218,032 (14,774,561) 43,443,471

14. LONG TERM LOANS & ADVANCESParticulars Amount in `

As at 31.03.2013 As at 31.03.2012(Unsecured-considered good)Capital Advance 462,422 750,850Security Deposits 6,692,034 6,091,899Total 7,154,456 6,842,749

15. INVENTORIESParticulars Amount in `

As at 31.03.2013 As at 31.03.2012Stores & Spares 2,366,773 1,802,386Raw Materials 43,514,981 36,173,734Waste 1,013,893 1,498,009Work in Progress 17,232,660 15,166,016Finished Goods 3,730,732 8,082,766Total 67,859,039 62,722,911

29


16. TRADE RECEIVABLESParticulars Amount in `

As at 31.03.2013 As at 31.03.2012Exceeding Six Months * - 1,124,319Less : Provision for doubtful debts - -

- 1,124,319Others 40,487,332 42,392,097Total 40,487,332 43,516,416

* Including amount receivable from holding company ` Nil (Previous year ` 3,856)

17. CASH & CASH EQUIVALENTSParticulars Amount in `

As at 31.03.2013 As at 31.03.2012Cash in hand 14,546 11,703Balances with Banks

In Current Acounts 5,099,037 6,282,056Held as margin / Fixed deposits 2,835,048 2,623,082

Total 7,948,631 8,916,841

Fixed deposits with maturity within 12 Months is ` 2,835,048 (Previous year ` 2,623,082)

18. SHORT TERM LOANS & ADVANCESParticulars Amount in `

As at 31.03.2013 As at 31.03.2012Advance Income Tax (including tax deducted at source) 2,780,158 1,199,584Others (considered good) 23,176,479 11,815,037Total 25,956,637 13,014,621

19. OTHER CURRENT ASSETS (Unsecured-considered good)


Export Incentives / Claims recoverable 4,142,772 5,048,854MAT Credit Entitlement 5,444,909 -Total 9,587,681 5,048,854


30

20. CONTINGENT LIABILITIES AND COMMITMENTS(to the extent not provided for)

( a ) Contingent LiabilitiesParticulars Amount in `

As at 31.03.2013 As at 31.03.2012

i) Bank Guarantees * 411,913 411,913 Includes a bank guarantee of ` 411,913 given by Holding Company to the Commissioner of Customs for duty free import of machines

(b) CommitmentsParticulars Amount in `

As at 31.03.2013 As at 31.03.2012Estimated amount of contracts (net of advances)

remaining to be executed on capital account and not

provided for

- 1,389,650

(c) i) The Board for Industrial and Financial Reconstruction (BIFR) in its order dated 16th Setember 2010 has directed that the

Company ceases to be a sick industrial Company within the meaning of section 3 (1) (o) of the SICA as its net worth has turned

positive for the year ended 31.03.10 and its revival is sustainable. It is therefore discharged from the purview of SICA/BIFR.

ii) The unimplemented provisions of SS-07 as may be there would be implemented by the Company/promoters and the

concerned agencies and implementation would be monitored by the Board of Directors of the Company.

iii) The Company would complete necessary formalities with the concerned Registrar of Companies as may be required.

iv) Aggrieved with the impugned order of BIFR directed to implement the unimplemented provisions of SS-07, The Director

General of Income Tax (DGIT) has filed an appeal with the Appellate Authority of Industrial and Financial reconstruction (AAIFR)

requesting to set aside the BIFR order dated 16.09.2010.

(d) The Company has not made any provision of MAT/ Income Tax on the basis of scheme of rehabilitation sanctioned by the BIFR.

In their order dated 16.09.2010, the “ Board” has stated that the un implemented provisions of SS-07 would be implemented by

the company/ promoters and concerned agencies. Against this order DGIT had filed an appeal before AAIFR challenging the

validity of the order. The Company is confident that the directions of BIFR will be upheld and no liability towards MAT/ Income

Tax will arise. In case any liability arises, the same will be accounted for as and when arises/ determined.

(e) The term loans and working capital loans obtained by Indo Count Industries Limited are to be secured by way of pari-passu

charge of the existing fixed assets of the company, subject to company obtaining necessary approvals.

31


21. REVENUE FROM OPERATIONSParticulars Amount in `

For the period 01.04.2012 to 31.03.2013

For the period 01.04.2011 to 31.03.2012

Gross Sales of Products * 598,716,212 473,336,541Less: Excise Duty - -

598,716,212 473,336,541Export Incentives / Benefits 8,904,606 4,092,812Revenue from Operations 607,620,818 477,429,353

* Includes sale to holding company ` 23,384,712 (previous year ` 54,939,004)

22. OTHER INCOMEParticulars Amount in `

For the period 01.04.2012 to 31.03.2013

For the period 01.04.2011 to 31.03.2012

Interest Banks * 235,519 761,487Interest Others ** 570,218 358,197Miscellaneous Receipts and Incomes 9,579 14,663Exchange rate difference 3,278,619 1,015,817Profit on Sale of Fixed Assets - -Liability no longer required written back 741,243 -Insurance Claim 191,871 -Sundry balances / Excess provision written back (Net) - 654,970Total 5,027,049 2,805,134

* Includes tax deducted at source ` 23,553 (previous year ` 73,883)** Includes tax deducted at source ` 57,021 (previous year ` 35,820)

23. COST OF MATERIALS CONSUMEDParticulars Amount in `

For the period 01.04.2012 to 31.03.213

For the period 01.04.2011 to 31.03.2012

Raw material & Components consumed Opening Stock 36,173,734 48,415,753 Add : Purchases * 379,186,471 343,118,867Sub - total 415,360,205 391,534,620 Less : Closing Stock 43,514,981 36,173,734 Cost of Sales 371,845,224 355,360,886

* Includes purchase from holding company ` Nil (previous year ` 262,595)

24. Includes purchase from holding company ` 975,421 (Previous year ` 2,047,677)


32

25. Changes in inventories of Finished goods, work in progress and stock in trade

Particulars Amount in `For the period

01.04.2012 to 31.03.2013For the period

01.04.2011 to 31.03.2012 Closing Stock Finished Goods 3,730,732 8,082,766 Stock in Process 17,232,660 15,166,016 Waste 1,013,893 1,498,009 Sub - total A 21,977,285 24,746,791 Less : Opening Stock Finished Goods 8,082,766 13,042,777 Stock in Process 15,166,016 17,938,712 Waste 1,498,009 1,089,250 Sub - total B 24,746,791 32,070,739(Increase)/Decrease in Stock B-A 2,769,506 7,323,948

26. EMPLOYEE BENEFITS EXPENSESParticulars Amount in `

For the period 01.04.2012 to 31.03.2013

For the period 01.04.2011 to 31.03.2012

Salaries & Wages 49,151,994 38,402,413Contribution to Provident & Other Funds 2,786,145 2,442,322Gratuity 1,495,201 799,873Staff Welfare Expenses 587,490 317,633Total 54,020,830 41,962,241

EMPLOYEE POST RETIREMENT BENEFITSParticulars Amount in `

For the period 01.04.2012 to 31.03.2013

For the period 01.04.2011 to 31.03.2012

During the year, the following contribution have been made under defined contribution plans:-Employer’s Contribution to Provident Fund 2,786,145 2,442,322

Gratuity and Leave encashment benefits 1,951,436 1,015,795

Defined Benefit Plans Gratuity Leave Benefit

Gratuity Leave Benefit

i) AssumptionsDiscount Rate 8% 8% 8% 8%

Salary Escalation 7% 7% 7% 7%

ii) Table showing changes in present value of obligationsPresent value of obligation as at beginning of the year 6,559,135 1,640,368 5,748,555 2,136,971

Interest cost 524,731 131,229 459,884 170,958

33


Current Service Cost 856,496 232,563 800,291 328,592

Benefits Paid (362,325) (122,282) (188,990) (54,004)

Actuarial (gain)/loss on obligation 318,743 167,130 (260,605) (942,149)

Present value of obligations as at end of year 7,896,780 2,049,008 6,559,135 1,640,368

iii) Table showing changes in the present value of plan

Fair value of plan assets at the beginning of year 2,152,381 617,768 1,348,963 292,150

Expected return on plan assets 260,740 74,835 185,228 51,182

Contributions 856,630 232,415 807,180 328,440

Benefits paid (362,325) (122,282) (188,990) (54,004)

Actuarial gain / (Loss) on plan assets - - - -

Fair value of plan assets at the end of year 2,907,426 802,736 2,152,381 617,768

iv) Table showing fair value of plan assetsFair value of plan assets at the beginning of year 2,152,381 617,768 1,348,963 292,150

Actual return on plan assets 260,740 74,835 185,228 51,182

Contributions 856,630 232,415 807,180 328,440

Benefits paid (362,325) (122,282) (188,990) (54,004)

Actuarial (gain)/loss on plan asset

Fair value of plan assets at the end of year 2,907,426 802,736 2,152,381 617,768

Present value of obligation at the end of year 7,896,780 2,049,008 6,559,135 1,640,368

v) Actuarial Gain / Loss recognizedActuarial gain / Loss for the year – obligation 318,743 167,130 260,605 942,149

Actuarial (gain)/Loss for the year – plan assets - - - -

Total (gain) / Loss for the year 318,743 167,130 260,605 942,149

Actuarial (gain / Loss recognized in the year 318,743 167,130 260,605 942,149

vi) The amounts to be recognized in the balance sheet and statements of Profit & lossPresent value of obligations as at the end of year 7,896,780 2,049,008 6,559,135 1,640,368

Fair value of plan assets as at the end of the year 2,907,426 802,736 2,152,381 617,768

Funded status (4,989,354) (1,246,272) (4,406,754) (1,022,660)

Net Asset / (Liability) recognized in balance sheet 4,989,354 1,246,272 4,406,754 1,022,660

vii) Expenses recognized in statement of Profit & LossCurrent services cost 856,496 232,563 800,291 328,592

Interest cost 524,731 131,229 459,884 170,958

Expected return on plan assets (260,740) (74,835) (185,228) (51,182)

Net Actuarial (gain)/Loss recognized in the year 318,743 167,130 (260,605) (942,149)Expenses recognized in statement of P&L 1,439,230 456,087 814,342 (493,781)

The Estimates of rate of future salary increase takes account inflation, seniority, promotion and other relevant factors on long term basis.

The discount rate is generally based upon the market yields available on Government bonds at the accounting date with a term that matches that of liability. The above information is certified by the actuary.


34

27. FINANCE COSTS

Particulars Amount in `

For the period01.04.2012 to 31.03.2013

For the period 1.04.2011 to 31.03.2012

Interest Expense

-Banks 536,307 784,556

-Others * 1,630,420 1,560,450

Bank Charges 1,272,635 942,209

Total 3,439,362 3,287,215

* Includes interest paid to holding company ` 1,614,300 (previous year ` 1,534,011)

28. DEPRECIATION & AMORTISATION EXPENSEParticulars Amount in `

For the period 01.04.2012 to 31.03.2013

For the period 01.04.2011 to 31.03.2012

Depreciation 10,218,794 12,035,933

Less : Transfer to Revaluation Reserve 6,263,309 6,263,308

Total 3,955,485 5,772,625

29. OTHER EXPENSES

Particulars Amount in `

For the period 01.04.2012 to 31.03.2013

For the period 01.04.2011 to 31.03.2012

Consumption of Stores, Spare and Packing Materials 16,696,731 9,940,209

Power & Fuel 88,239,416 67,781,255

Rent (including lease rent) (a) 2,629,200 2,321,884

Rates, Taxes & Fees 983,932 591,683

Insurance 776,517 666,903

Repairs to Machinery 636,305 405,315

Repairs to Buildings 927,543 200,680

Commission & Brokerage 7,542,816 5,480,084

Freight Outward 5,625,188 3,022,376

Bad debts written off 1,055,823 -

Miscellaneous expenses (b) 6,950,270 4,698,723

Total 132,063,741 95,109,114

35


(a) Includes Operating Lease paid to Holding Company. As Lessee :

Particulars 2012-13 2011-12

A) The total of future minimum lease payments under non-cancelable operating leases for each of the following years:

i) Not latter than one year - -

ii) Later than one year and not later than five years,

iii) Later than five years, 16,146,150 18,750,150

B) The total of future minimum sub-lease payments expected to be received under non cancelable sub leases at the balance sheet date,

- -

C) Lease payments recognized in the statement of profit & loss 2,604,000 2,296,684

(b) Includes payment to auditors Details of Auditors remuneration

Particulars Amount in `For the period

01.04.2012 to 31.03.2013For the period

01.04.2011 to 31.03.2012

As Statutory Audit Fees 120,000 120,000

As Quarterly Audit / Limited Review Fees 70,000 70,000

As Tax Audit Fees 50,000 50,000

For Certification Work 10,000 -

In Other Capacity 5,000 5,000

Total 255,000 245,000

30. FORWARD CONTRACTSCurrency Number of

ContractsAmount in

Foreign CurrencyAmount Buy / Sell(` in lac)

US $ / INR 2 US $ 365,000 119.82 Sell

Previous Year (NIL) (NIL) (NIL)

31. Related Party Disclosure:Related party disclosures as required by AS - 18 “Related Party Disclosures” are given below:-

A. Holding Company : i) Indo Count Industries Ltd.

B. Directors : i) Shri Anil Kumar Jain ii) Shri Kamal Mitra

C. Associates : i) Margo Finance Ltd.


36

Transactions with Related Parties during the year and balances at the end of the year.

Nature of transaction Holding Company Associates Total

31.03.13 31.03.12 31.03.13 31.03.12 31.03.13 31.03.12

` ` ` ` ` `

i) Unsecured Loans

- Opening balance 18,112,727 16,720,239 - - 18,112,727 16,720,239

- Taken during year 1,452,870 1,392,488 - - 1,452,870 1,392,488

- Repaid during year 5,500,000 - - 5,500,000 -

- Closing balance 14,065,597 18,112,727 - - 14,065,597 18,112,727

ii) Debtors - 3,856 - - - 3,856

iii) Creditors - 1,100 - 1,100

iv) Expenses - -

- Purchases/Jobwork Chrgs 994,929 2,310,272 - - 994,929 2,310,272

- Rent - - 25,200 25,200 25,200 25,200

- Interest 1,614,300 1,547,208 - - 1,614,300 1,547,208

- Lease Rental 2,604,000 2,532,093 - - 2,604,000 2,532,093

- Other Expenses 4,423,487 3,696,930 3,220 1,100 4,426,707 3,698,030

v) Income - -

- Sales during the year 23,384,712 54,939,004 - - 23,384,712 54,939,004

32. EARNING PER SHARE (EPS)

Particulars For the period 01.04.2012 to 31.03.2013

For the period 01.04.2011 to 31.03.2012

Basic / Dilutive Earnings Per ShareProfit after tax as per profit & loss account 28,798,647 (21,090,696)

Less : Dividend and tax thereon in respect of preference shares - -

Profit available for shareholders A 28,798,647 (21,090,696)

No. of equity shares B 19,241,280 19,241,280

Basic / Dilutive Earning Per Share (`) (A/B) 1.50 (1.10)

33. In the opinion of the management, the current assets, loans and advances are expected to realize at least the amount at

which they are stated, if realized in the ordinary course of business. Provision for all known liabilities have been adequately

made in the accounts.34. It is the management’s perception that since the company is exclusive engaged in the activity of manufacture of cotton yarn

which are governed by the same set of risks and returns the same are considered to constitute a single reportable segment in

the context of Accounting Standard on “ Segment Reporting” issued by the Institute of Charted Accountants of India.35. Figures have been rounded off to the nearest Rupee and have been regrouped/rearranged wherever considered necessary.

37


36. Value of imported / indigenous Raw materials, Stores & spares consumedClass of Goods For the period

01.04.2012 to 31.03.2013For the period

01.04.2011 to 31.03.2012

Percentage Amount Percentage Amount

(`) (`)

Raw Materials

Imported - - - -

Indigenous 100.00 371,845,224 100.00 355,360,886

100.00 371,845,224 100.00 355,360,886

Stores & Spares

Imported 0.97 161,930

Indigenous 99.03 16,534,801 100.00 9,940,209

100.00 16,696,731 100.00 9,940,209

37. Other Informations

Particulars Amount (`)

For the period 01.04.2012 to 31.03.13

For the period 01.04.2011 to 31.03.2012

Expenditure in Foreign Currency

Selling Commission / Claims 4,084,961 1,895,548

Earnings in Foreign Currency

FOB value of exports 337,594,551 198,480,742

(Including deemed exports ` 52,864,087 (previous year ` 72,571,192 ))

See accompanying notes to the financial statements As per our report of even date annexed For B.K.SHROFF & CO., S. K. Agrawal Anil Kumar Jain Chartered Accountants Chairman Director Reg. No. 302166E

O.P. Shroff D.V. Kulkarni

Partner Company Secretary

Membership No. 6329 Mumbai, 24th May 2013


38

NOTES

39


Signature (S)

Affix aRe.1/-

Revenuestamp

PRANAVADITYA SPINNING MILLS LIMITEDREGD OFFICE : Office no- 2, Village Alte, Taluka Hatkanangale, DIst, Kolhapur- 416109, Maharashtra

PROXY FORM

I / We _________________________________________________________________________________________________________

of _____________________________________________________________________________________ being a member/members

of the above named Company hereby appoint ______________________________________________________________________

of_________________________________________________________________ or faling him/her _______________________________

________________________________of _______________________________________________as my / our proxy to vote for me / us

on my / our behalf at the 23rd ANNUAL GENERAL MEETING of the Company to be held at Office no-2, Village Alte, Taluka Hatkanangale,

DIst, Kolhapur- 416109, Maharashtra, on Saturday, 20th July, 2013 at 11.00 am.

Signed this ______________________day of ________________________ 2013

Address:

Note : The Proxy Form duly completed, stamped and signed must be deposited at the Registered Office of the Company, not less than Forty

Eight hours before the time of holding the Meeting.

PRANAVADITYA SPINNING MILLS LIMITEDREGD OFFICE : Office no- 2, Village Alte, Taluka Hatkanangale, DIst, Kolhapur- 416109, Maharashtra

ATTENDANCE SLIP

Signed this_________________________ day of ___________________2013

Name and address of the Shareholder/Proxy

Note : 1. Please complete this attendance slip and hand it over at the entrance of the venue of the Meeting.

2. Please bring your copy of Annual Report at the time of Annual General Meeting.

DP ID / Folio No.

Client ID

DP ID / Folio No.

Client ID

I, hereby record my presence at the 23rd ANNUAL GENERAL MEETING of the Company being held at Registerde office of the company

Office no- 2, Village Alte, Taluka Hatkanangale, DIst, Kolhapur- 416109, Maharashtra on saturday the Saturday, 20th July, 2013 at 11.00 am.

No. of Shares

No. of Shares

Signature of Shareholder/Proxy

Count On Us...

Pranavaditya Spinning Mills Ltd. Annual Report 2012-13

Pranavaditya Spinning Mills Ltd. 301, ‘Arcadia’, Nariman Point,

Mumbai-400021, India.E-mail - [email protected]

www.indocount.com

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