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116th Annual Report
Making growth fashionable.
MILESTONES
1980
1989
1994
1998
2000
2002
2004
2005
2006
2007
Launch of the first‘K-Lounge’Launch of ‘Killer’
Launch of ‘Lawman’& ‘Easies’
Launch of ‘Integriti’
IPO of 31 Lac Shares
K-Loungs reach60 stores
M/s Keval Kiran &Co wasincorporated
Export of ‘Killer’brand to UAE
Consolidation ofbusiness underone entity
Move towardscorporate structure
Awarded thebest SMEcompany inTextiles/ApparelSector byCNBC TV 18and ICICE Bank
KillerWomenWearLaunched
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• Planning to add other lifestyle products likefragrances, time wear, eyewear andinnerwear
• Target Age Group 16-25• Latest collection - Immortal Jeans• Price Range
� Jeans Rs. 845 - Rs. 1895� Trousers Rs. 995 - Rs. 1495� T Shirts Rs. 345 - Rs. 995� Shirts Rs. 745 - Rs. 1295� Jackets Rs. 1795 - Rs. 2695
• Target Age Group 18-28
• Latest collection • PG 3
• Price Range
� Jeans Rs. 695 - Rs. 1695
� Trousers Rs. 695 - Rs. 1495
� Shirts Rs. 695 - Rs. 1995
• Innovation in Fabric and designs
• Planning to launch range of Cargos,T-Shirts, Jackets, Sweaters, Ties
• Target Age Group 23-40
• Latest collection - Non Repeat Shirts
• Price Range
� Shirts Rs. 795 - Rs. 1495
� Trousers Rs. 1095 - Rs. 1895
• Target Age Group 18-30
• Price Range
� Jeans Rs. 595 - Rs. 1195
� Trousers Rs. 595 - Rs. 995
� Shirts Rs. 495 - Rs. 895
� Jackets Rs. 795 - Rs. 1495
• Launched in 1989• Power Brand for youth with
an international feel andunique style quotient
• Casual Men’s wear• Launched Women’s wear in
2007
• Launched in 1998
• Design led brand
• Men’s Club wear
• Launched high fashionrange of shoes andeyewear
• Exclusive Retail StoreConcept under brand name“K-Lounge” displaying ourfour brands creating acompelling mix of fashion,price and quality
EASIES
• Launched in 1998
• Fashion Brand for office andafter office hours
• Men’s formal and semi formalwear
• Launched in 2002
• Mass market brand
• Fashionable yet affordable
• Men’s formal and semiformal wear
• K-Lounge stores help in presenting thecomplete brand experience to consumers
• Improves brand visibility.
• 60 stores currently operating at primelocations in the country with an areaexceeding 1,10,000 sq. ft. with 15 storesin Metro cities like Mumbai, New Delhi,Hyderabad, Kolkatta.
• Current Focus is on small format storesbut plans to open mid format and largeformat stores.
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INDEX
General Information 04
Letter to the Shareholders 06
Notice 08
Directors’ Report 11
Report on Corporate Governance 16
Management Discussion and Analysis 28
Auditors’ Report 31
Balance Sheet 34
Profit & Loss Account 35
Cash Flow Statement 36
Schedule forming part of Accounts 38
Balance Sheet Abstract & Company’s General Business Profile 55
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GENERAL INFORAMTION
Board of Directors Mr. Kewalchand P. JainChairman & Managing Director
Mr. Hemant P. JainWhole-time Director
Mr. Dinesh P. JainWhole-time Director
Mr. Vikas P. JainWhole-time Director
Mr. Popatlal F. SundeshaNon Executive Independent Director
Mr. Mrudul D. InamdarNon Executive Independent Director
Dr. Prakash A. ModyNon Executive Independent Director
Mr. Nimish G. PandyaNon Executive Independent Director
Company Secretary Mr. Abhijit B. Warange
Statutory Auditors M/s. Jain & TrivediChartered Accountants
M/s. N.A. Shah AssociatesChartered Accountants
Bankers Standard Chartered BankMumbai.
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Registered Office B-101 to 107, Synthofine Estate,Opp. Virwani Industrial Estate,Goregaon (East), Mumbai - 400 063.
Corporate Office Kewal Kiran Estate, Behind Tirupati Udyog,460/7, I.B. Patel Road, Goregaon (East),Mumbai - 400 063.
Registrar & Intime Spectrum Registry Limited,Transfer Agents C-13, Pannalal Silk Mills Compounds,
L.B.S. Marg, Bhandup (West),Mumbai - 400 078.
Factories Vapi
Plot No. 787/1, 40, ShedIInd Phase, G.I.D.CVapi - 396 195.Gujarat
Daman
697/3/5/5A, Near Maharani Estate,Somnath Road, DhabelDaman - 396 210.
Mumbai
Synthofine Estate,Opp Virwani Industrial EstateGoregaon (East),Mumbai - 400 063.
71-73, Kasturchand Mill EstateBhawani Shankar Road,Dadar (West),Mumbai - 400 028.
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LETTER TO THE SHAREHOLDERS
Dear Shareholders,
It has been one year since your company entered the Indiancapital market. During this year, your company has progressedby leaps and bounds, and it is my pleasure to share themilestones of this journey with you.
Industry Scenario: Retail and Manufacturing growth tospur on greater successes
The Indian apparel and fashion accessories market is estimatedat $12 billion, and is growing at the rate of around 15% in value
terms and 5% in volume terms. Of the total apparel market, only13.6% is organized, so that with the logical shift towards branded
products by consumers, organized players will grab a large chunk of thepie and grow at a faster pace.
Your company is well-poised to benefit from the impending boom in domestic organized retail and continuedstrong growth in consumption in India. There is growth in retail space across the country, changing lifestyleand demographics of consumers, rise in disposable income and an increase in consumer appetite for brandedproducts.
According to AT Kearney’s 2006 Global Retail Development Index, Asia has reclaimed the top position fromEastern Europe, with India rising to the number one position. The retail sector is one of the most significantcontributors to the Indian economy, amounting to about 35% of the GDP. According to a report by the McKinseyGlobal Institute, India’s GDP is also expected to grow at a CAGR of 8% from 2005 to 2010, which wouldcontinue to support the retail industry. India’s total retail spend is expected to grow at a CAGR of 8.6%, duringthis time period, totaling $440 billion in 2010 from $284 billion in 2005. With the organized retail segmentaccounting for only 3% of the total spend in 2005, this is expected to more than double to 6.3% in 2010.
The Government has also realized the importance of modernizing the retail sector, as evident from the gradualopening of the sector to Foreign Direct Investment (FDI). While currently foreign companies are able to ownup to 51% of a single brand retail company or directly invest through the cash and carry wholesale tradingmodel, there seems to be a definite but gradual movement towards allowing foreign retailers into the country,thus strengthening the hands of organized retail.
The budget 2007 has not been all that favorable to the industry with the CST not being phased out completely;the cost to the industry may not go down after all. The Service Tax on commercial property rent will increasethe cost of retailing. Property rentals are already a huge cost component in view of high rentals across thecountry. On the Direct Tax front the increase in the Dividend Dicstribution Tax will result in higher cash outflowand the 1% additional cess on all tax will add to higher tax incidence.
Financial Performance: Notching up the numbers
During the financial year ended March 31, 2007, sales and operating income increased to Rs 133.62 crorefrom Rs 85.96 crore. The net profit before tax stood at Rs 28.18 crore against Rs 18.20 crore in the previousyear. The net profit after tax stood at Rs 18.65 crore against Rs 11.93 crore for the previous financial year.
On the back of the high performance achieved by your company, the Board of Directors have pleasure inrecommending a dividend of 25% per equity share, that is, Rs 2.50 per share of Rs 10 each, for the yearended March 31, 2007, compared to the Rs 1.50 per share in the previous year.
Operational performance: Working towards higher peaks
Your company is an integrated apparel manufacturer, with capabilities ranging from design to manufacturingprocesses involving cutting, body stitching, washing, ironing & finishing, marketing and retailing of branded
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apparel. Your company has four well-established brands: ‘KILLER’, ‘Pg3 LAWMAN’, ‘EASIES’ and ‘INTEGRITI’.Your company has made an aggressive foray into the domestic retail market under its retail brand ‘K-LOUNGE’
A. Manufacturing
The current manufacturing capacity of your company has gone up to 3 million garments from 2 milliongarments last year. Your company has 4 manufacturing units: one each at Dadar (Mumbai), Goregaon(Mumbai), Vapi (Gujarat) and Daman (Union Territory). The facilities at Daman, Vapi and Mumbai havebeen assessed and registered as ISO 9001:2000 and ISO 14001:2004 compliant, pertaining to qualitymanagement system and environment management system respectively.
During the year ended March 31, 2007, your company acquired about 53,000 square feet land and about40,000 square feet building thereon at Daman. Your company has realigned its manufacturing facilities atDaman to make use of about 20,000 square feet area in the new premises.
B. Brands and Retail Operations
During this year, your company has opened 26 branded K-LOUNGE stores, taking the tally to 55 storesas per March 31, 2007. Subsequent to the financial year-ending, 5 stores have been opened, so that 60K-LOUNGE stores are operational across the country on the date of this report.
Your company has expanded the product line in ‘Pg3 LAWMAN’ and ‘INTEGRITI’ brands, by launching anexclusive knitwear collection. Your company has also introduced fashion accessories like eye wear andcasual shoes.
The much-awaited women’s wear range under ‘KILLER’ brand was launched in the Summer 2007 collectionand your company has received an encouraging response from customers.
Awards: Recognition of Performance
During the year ended March 31, 2007, your company has been awarded the ‘SMB Industry 2.0 Award’ forachieving highest rating in the ranking of India’s Top 500 Manufacturing Small and Mid-Sized Companies.Your company’s Chairman and Managing Director has also been presented with the prestigious ‘Apex BrandEntrepreneur of the Year Award 2005-2006’.
Looking Ahead: Banking on Better Retail Spread
The second phase of capacity expansion will be taken up during the current year, taking the total manufacturingcapability to 4 million pieces. Your company has placed orders for machinery and other equipments to reachthis capacity during the current year.
During the current financial year, your company plans to open about 88 new retail stores, comprising both ofK-LOUNGE stores and Exclusive Brand Outlets (EBOs). Your company has planned 16 ‘KILLER’ EBOs, 14EBOs each for ‘Pg3 LAWMAN’ and ‘INTEGRITI’ and 1 flagship store for the ‘EASIES’ brand. More than 40stores across the country have also been identified and booked.
Encouraged by the strong response to the limited roll-out of the women’s wear range under the ‘KILLER’brand, your company intends to expand the product offerings and launch it nationwide shortly. Consideringthe dearth of women’s’ wear brands in the mid-premium market, this is expected to generate a good response.
Other plans include expanding the product line with apparels and non-apparel accessories like time wear andfragrances. While your company has already launched fashion accessories like eye wear and casual shoes,there are plans to add more accessories under the existing brands in the near future.
The current year continues to be promising and we are doing our utmost to perform even better during the year.
To end, let me take this opportunity to thank our dedicated team for their valuable support and cooperation,without which the company would not have been able to reach the position it enjoys today.
I would also take this opportunity to thank my colleagues on the Board for their valuable participation andcontribution while guiding the course of the company.
Kewalchand P JainChairman and Managing Director
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NOTICE OF 16TH ANNUAL GENERAL MEETING
NOTICE is hereby given that the 16th Annual General Meeting of Kewal Kiran Clothing Limited will be held on Tuesday,August 7, 2007 at M.C. Ghia Hall, Bhogilal Hargovindas Building, 2nd Floor, 18/20, Kaikhushru Dubash Marg, (BehindPrince of Wales Museum) Mumbai: 400 001 at 3.00 p.m. to transact the following business:
ORDINARY BUSINESS:
1. To receive, consider and adopt the Audited Balance Sheet as on March 31, 2007 and the Profit and Loss Accountfor the financial year ended March 31, 2007 together with the report of the Directors and Auditors thereon.
2. To declare a dividend on Equity shares.
3. To appoint a Director in place of Mr. Dinesh P. Jain, who retires by rotation and being eligible, offers himself for re-appointment.
4. To appoint a Director in place of Mr. Vikas P. Jain, who retires by rotation and being eligible, offers himself for re-appointment.
5. To appoint a Director in place of Mr. Popatlal F. Sundesha, who retires by rotation and being eligible, offers himselffor re-appointment.
6. To appoint M/s. Jain & Trivedi, Chartered Accountants as the Statutory Auditors of the company and fix theirremuneration.
7. To appoint M/s. N.A. Shah Associates, Chartered Accountants as the joint Statutory Auditors of the company andfix their remuneration.
By order of the Board of Directors
Abhijit B. WarangeCompany Secretary
Regd. Office:
B101-107, Synthofine Estate,Opposite Virwani Industrial Estate,Goregaon (E),Mumbai-400 063
Place: MumbaiDate: May 15, 2007
NOTES:
1. A MEMBER ENTITLED TO ATTEND AND VOTE IS ENTITLED TO APPOINT A PROXY TO ATTEND AND VOTEINSTEAD OF HIMSELF AND THE PROXY NEED NOT BE A MEMBER. IN ORDER TO BE VALID, PROXIESDULY STAMPED, SHOULD BE LODGED WITH THE COMPANY AT ITS REGISTERED OFFICE NOT LATERTHAN FORTY EIGHT HOURS BEFORE THE COMMENCEMENT OF THE MEETING.
2. Corporate Members intending to send their authorized representatives to attend the meeting are requested tosend a certified copy of the Board Resolution authorizing their representatives to attend and vote on their behalfat the meeting
3. There being no Special Business to be transacted at the meeting, explanatory statement pursuant to Section173(2) of the Companies Act, 1956 would not be required.
4. The Register of Members and the Share Transfer Books of the company will remain closed from Wednesday, July25, 2007 to Tuesday, August 7, 2007 (both days inclusive).
5. The dividend as may be declared shall be payable to members of the company whose names appear:
a) As Beneficial Owners as at the end of business hours on July 24, 2007, as per the list to be furnished byNational Securities Depository Ltd. and Central Depository Services (India) Ltd., in respect of the sharesheld in electronic form and
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b) As members on the Register of Members of the Company as at August 7, 2007 after giving effect to validtransfers in respect of transfer request lodged with the company on or before the close of business hours onJuly 24, 2007.
6. The Securities and Exchange Board of India (SEBI) and the Reserve Bank of India (RBI) have advised all listedcompanies to mandatorily use the Electronic Clearing Services (ECS) facility wherever possible for dividendpayment to the shareholders. In view of this stipulation the company proposes to implement the ECS facility.Members are requested to provide the company with ECS mandate for crediting the future dividend paymentdirectly to their respective bank accounts. The Company shall be able to coordinate with the bankers only onreceipt of the necessary information. The main information required therein is the type of account, name of thebank and the account number. It should be signed by all the holders, as per the specimen signature recorded withthe Company/Depository Participant.
7. Members holding shares in the same set of names under different ledger folios are requested to apply forconsolidation of such folios alongwith relevant share certificates to the company’s Registrar & Transfer Agents,M/s Intime Spectrum Registry Limited, C-13, Pannalal Silk Mills Compound, L.B.S Marg, Bhandup (West), Mumbai400 078.
8. Members holding shares in physical segment are requested to notify change in their address/status, if any,immediately to the company’s Registrar & Transfer Agents, M/s Intime Spectrum Registry Limited, C-13, PannalalSilk Mills Compound, L.B.S Marg, Bhandup (West), Mumbai 400 078.
9. The company has designated an exclusive e-mail id called grievanceredressal@kewalkiran.com for redressalof shareholders complaints /grievances. In case you have any queries/complaints or grievances then please writeto us at grievanceredressal@kewalkiran.com
10. Members who would like to ask any questions on the accounts are requested to send their questions at RegisteredOffice of the company at least 10 days before the Annual General Meeting to enable the company to answer theirqueries satisfactorily.
11. Members are requested to bring their copies of the Annual Report to the Annual General Meeting.
12. Members/proxies should bring the attendance slip duly filled in and signed for attending the meeting.
13. Reappointment of Directors:
Profile of Directors retiring by rotation and offering for re-appointment:
At the ensuing Annual General Meeting Mr. Dinesh P. Jain, Mr. Vikas P. Jain and Mr. Popatlal F. Sundesha retire byrotation and being eligible, offer themselves for re-appointment. Pursuant to Clause 49 of Listing Agreement relating toCode of Corporate Governance, the particulars of the aforesaid Directors are given below:
1. Mr. Dinesh P. Jain:
Born in 1969, Mr. Dinesh Jain joined the business in 1990. Mr. Jain heads the manufacturing operations of thecompany. He specializes in Production and HR related issues. Mr. Jain is also responsible for ensuring optimumutilization of production facilities of the company at its units at Dadar, Goregaon, Daman and Vapi. Mr. Jain is atrustee of Jatnobai Karmchandji Ratanparia Chauhan Charitable Trust. He is also the treasurer of Daman IndustriesAssociation.
Mr. Jain holds 6,27,250 shares in his individual capacity and 16,000 shares as a Karta of Dinesh P. Jain (H.U.F)in the company as on the date of this notice.
The details of other directorships of Mr. Dinesh P. Jain are as follows:-
Name of the Company Board Position Held
Kornerstone Retail Ltd. Director
Kewal Kiran Retail India Pvt. Ltd. Director
Kewal Kiran Realtors Pvt. Ltd. Director
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2. Mr. Vikas P. Jain:
Born in 1970 Mr. Vikas P. Jain joined the business in 1992, after completing his graduation in commerce. Mr. Jain
heads the operations and distribution functions of the company. He is responsible for marketing of Lawman and
Intigriti brands. He also looks after the business of K-Lounge, the retail concept of the company. Mr. Jain travelsextensively and scouts for new technologies in garment manufacturing. He is a trustee of Jatnobai Karmchandji
Ratanparia Chauhan Charitable Trust.
Mr. Jain holds 6,27,250 shares in his individual capacity and 16,000 shares as a Karta of Vikas P. Jain (H.U.F) inthe company as on the date of this notice.
The details of other directorships of Mr. Vikas P. Jain are as follows:-
Name of the Company Board Position Held
Kornerstone Retail Ltd. Director
Kewal Kiran Retail India Pvt. Ltd. Director
Kewal Kiran Realtors Pvt. Ltd. Director
3. Mr. Popatlal F. Sundesha:
Mr. Popatlal Fulchand Sundesha is a reputed exporter of garments and has a wide range of experience in thefield of marketing, finance and general administration.
Mr. Sundesha took over his fathers business along with his three brothers and converted a medium sized trading
firm into one of the leading manufacturer and exporter of knitted readymade garments to Non Quota countries
like Switzerland, Netherland, U.K and others. His firm has supplied garments to Wal-Mart, Woolworth, Benetton,Manor AG and others.
He has been awarded the President’s award in exports as also Apparels Export Promotion Council Award for six
years.
As on the date of this notice Mr. Sundesha does not hold any shares in the company. Fulchand Exports PrivateLimited is the holder of 20,000 Equity Shares and Fulchand Finance Private Limited is the holder of 20,000 Equity
Shares in the company as on the date of this notice. Mr. Popatlal Sundesha, is a director & shareholder ofFulchand Finance Private Limited. Relatives of Mr. Popatlal Sundesha are directors and shareholders of Fulchand
Exports Private Limited.
The details of other directorships of Mr. Popatlal F. Sundesha are as follows:-
Name of the Company Board Position Held
Apaksh Broadband Ltd. Director
Aksh Opti Fibre Ltd. Director
Aksh Broadband Ltd. Director
Derivium Capital & Securities Pvt. Ltd Chairman
Fulchand Finance Pvt. Ltd. Chairman
The details of committee memberships of Mr. Popatlal F. Sundesha are as follows:-
Name of the Company Name of the Committee Position Held
Kewal Kiran Clothing Ltd. Audit Committee Member
Kewal Kiran Clothing Ltd. Remuneration Committee Member
Aksh Opti Fibre Ltd. Audit Committee Member
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DIRECTORS’ REPORT
To The Members
Your Directors have pleasure in presenting the 16th Annual Report together with the audited accounts of the Companyfor the year ended 31st March, 2007.
FINANCIAL RESULTS:For the year ended March 31,
2007 2006
Rs. ’000 Rs. ’000
Net Sales/Income from operations 1,336,194 859,638
Other Income 74,777 7,156
Total Expenditure 1,083,732 660,117
Gross profit (Before deducting any of the following) 327,239 206,677
a. Finance charges 15,845 10785
b. Provision for depreciation 29,619 13,903
c. Tax provision 95,309 62,646
Net profit for the year 186,466 119,343
i Prior Period Expenses – 2,873
ii Tax adjustment of prior year – (25)
iii Balance of profit/(loss) 186,466 116,495
Appropriation of profit
i Bonus shares issued during the year – 30,000
ii Proposed Dividend (Including Dividend Tax) 36,049 21,080
iii Transfer to General Reserve 20,000 10,000
Dividend (in Rs.) per ordinary share 2.5 1.50
Paid up Equity capital 123,250 92,250
Reserves except revaluation reserve 1,137,026 275,987
TURNOVER & PROFITS:
Your Directors wish to inform you that during the financial year ended 31st March, 2007, the sales and operatingincome increased to Rs. 1,336,194 thousand from Rs. 859,638 thousand. The net profit before tax stood at Rs. 281,775thousand against Rs. 181,989 thousand in the previous year. The net profit after tax stood at Rs. 186,466 thousand asagainst Rs. 119,343 thousand for the previous financial year.
DIVIDEND:
Encouraged by the performance achieved by your company, your directors are pleased to recommend a dividend ofRs. 2.50 (25%) per equity share of Rs. 10/- each for the year ended March 31, 2007 as compared to Rs. 1.50 per sharein the previous year.
The dividend of Rs. 2.50 per share recommended by the Board of Directors is on the expanded share capital basesubsequent to the initial public offering made by the company.
The dividend once approved by the members in the ensuing Annual General Meeting will be paid out of the profits ofyour company for the year and will sum up to a total of Rs. 36,049 thousand including dividend distribution tax.
An amount of Rs. 20,000 thousand would be transferred to the reserves.
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INITIAL PUBLIC OFFER:
Your company entered the capital market with an issue of 31,00,037 Equity shares of Rs. 10/- each through 100%Book Building Route which opened for public subscription on March 20, 2006 and closed on March 23, 2006. Theallotment of the shares was made on April 5, 2006. The shares of your company got listed on Bombay Stock ExchangeLtd. (BSE) and National Stock Exchange of India Ltd. (NSE) on April 13, 2006.
IPO FUND UTILISATION:
The object of the issue were to finance your company’s capital expenditure in setting up new manufacturing facilities,expansion of distribution network by opening additional exclusive outlets, building corporate office, to meet generalcorporate purposes and achieve the benefits of listing.
The details of the utilization of funds as on the date of this report is detailed below:
Rs. ’000
Purpose of utilization of fund Projected utilization upto year Actual utilization uptoended 31st March 2008 15th May 2007
Corporate Office 50,000 43,425
Setting Up Retail Stores 3,46,760 52,048
Setting up of Manufacturing unit 323,990 66,312
Share Issue Expenses 72,550 78,085
Total Expenses 7,93,300 2,39,870
The lower utilization on the projects is due to delay in getting possession of retail and manufacturing premises. Theunutilized funds have been invested in fixed deposits with bank
During the year ended March 31, 2007 your company has opened 26 K-Lounge stores taking the tally to 55 stores ason March 31, 2007. Subsequent to financial year ended March 31, 2007, upto to the date of this report 7 stores weremade operational and 2 stores were closed due to location disadvantage. On the date of this report your company has60 K-Lounge stores operational across the country. The details of the K-Lounge stores can be viewed on the company’swebsite www.kewalkiran.com
During the year ended March 31, 2007 your Company has acquired about 53,000 Sq. Feet Land and about 40,000 Sq.Feet Building thereon at Daman. Your Company has realigned its manufacturing facilities at Daman to make use ofabout 20,000 sq. feet area in the new premises. The current manufacturing capacity of your Company has gone up toabout three million garments. The Second phase of Expansion will be taken up during the current year, taking the totalmanufacturing capacity to four million pieces. Your Company has also placed the orders for machinery and otherequipments to reach capacity of four million garments by the end of current year.
CAPITAL STRUCTURE:
The pre issue issued, subscribed and paidup capital of your company was Rs. 9,22,50,000/- comprising of 92,25,000Equity shares of Rs. 10/- each. Post issue of 31,000,37 Equity shares of Rs. 10/- each the issued, subscribed andpaidup capital of your company is Rs. 12,32,50,370/- comprises of 1,23,25,037 Equity shares of Rs. 10/- each.
CASH FLOW STATEMENT:
In conformity with the provisions of Clause 32 of the Listing Agreement with Stock Exchanges, the Cash Flow Statementfor the year ended 31st March 2007 is annexed hereto.
RELATED PARTY TRANSACTION:
Related party transactions have been disclosed in the notes to accounts.
DIRECTORS:
In accordance with the provisions of the Companies Act, 1956, and the Articles of Association of your company,Mr. Dinesh P. Jain, Mr. Vikas P. Jain and Mr. Popatlal F. Sundesha, Directors of your Company would retire by rotationat the ensuing Annual General Meeting and being eligible have offered themselves for reappointment.
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DIRECTORS’ RESPONSIBILITY STATEMENT:
Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956 with respect to Director’s Responsibility
Statement, it is hereby confirmed:
(i) that in the preparation of the annual accounts for the financial year ended March 31, 2007, the applicable accounting
standards have been followed along with proper explanation relating to material departures;
(ii) that the directors have selected such accounting policies and applied them consistently and made judgements
and estimates that are reasonable and prudent so as to give 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;
(iii) 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;
(iv) that the directors have prepared the accounts for the financial year ended 31 March 31, 2007 on a ‘going concern’
basis.
CORPORATE GOVERNANCE:
Kewal Kiran Clothing Limited is committed to conducting business of your company with the highest level of integrity
and transparency. The commitment of your company is clearly reflected in the business activities of the company.
Report on Corporate Governance as stipulated by Clause 49 of the Listing Agreement with the Stock Exchanges
forms a part of the Annual Report. The Auditors’ certificate confirming compliance of the Corporate Governance
requirements by your company is attached to the Report on Corporate Governance.
MANAGEMENT DISCUSSION AND ANALYSIS:
A detailed review of operations, performance and future outlook of the company is given separately under the head
Management Discussion and Analysis and forms a part of this report.
COMPLIANCE WITH THE CODE OF CONDUCT:
Your company has put in place a Code of Conduct effective January 14, 2006, for its Board members and Senior
Management Personnel. Declaration of compliance with the code of conduct have been received from all the Board
Members and Senior Management Personnel. A certificate to this effect from the Mr. Kewalchand P. Jain, Chairman &
Managing Director forms a part of this Report.
AUDIT COMMITTEE:
In accordance with Clause 49 of the Listing Agreement your company has constituted an Audit Committee which
consists of three non-executive independent directors of the company viz. Mr. Mrudul D. Inamdar (Chairman of Audit
Committee), Mr. Popatlal F. Sundesha and Mr. Nimish G. Pandya.
RECOGNITION AND AWARDS:
During the year ended March 31, 2007 your company has been awarded the ‘SMB INDUSTRY 2.0 AWARD’ for
achieving highest rating in the ranking of India’s Top 500 Manufacturing small and mid sized Company rating.
During the year ended March 31, 2007 Mr. Kewalchand P. Jain, Chairman & Managing Director of your Company has
been awarded the prestigious ‘APEX BRAND ENTREPRENEUR OF THE YEAR AWARD 2005-2006’
PRODUCTS:
Your company has expanded the product line in Pg 3 LAWMAN & INTEGRITI brands by launching exclusive knit wear
collection. Your company has also introduced Fashion Accessories like eye wear and casual shoes and is planning to
add more accessories under the existing brands in near future.
The much awaited women’s wear range under KILLER brand has been launched in summer 2007 collection. Your Company
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has received encouraging response from customers and we intend to expand the product offerings and launch it nation
wide shortly. With planned expansion in retail, your company also intends to expand the product line to include apparels
& non apparel accessories like time wear & fragrances. These will enhance the brand experience for the customers.
INVESTMENT IN WHITE KNITWEAR PRIVATE LIMITED:
Your company has invested Rs. 3300 thousand in the first phase of investment in White Knitwear Private Limited
(WKPL) being 1/3rd equity capital of the WKPL. WKPL has acquired land in Surat SEZ for manufacturing apparels for
European and American market. Subsequent to the year ended March 31, 2007 your company has invested Rs. 100
thousand in WKPL in the second phase of investment by applying for 1,00,000 9% Redeemable Cumulative Preference
Shares of Rs. 10/- each. Your company intends to make further investments in the WKPL based on the expansion plan
in two phases.
OUTLOOK:
With growing aspiration of Indian consumers fuelled by rising income, higher affordability, country wide retail proliferation,
spurt in rural demand and exponential growth in Tier II & Tier III towns we expect that apparel industry may show
exciting growth in coming years. Indian & International players operating in India will target brand portfolio expansion
& product expansion to take advantage of fast growing market.
With the positive changes in overall economy and consumer behavior, outlook for your company is encouraging.
FIXED DEPOSIT:
Your company has not accepted any deposit within the meaning of Section 58A of the Companies Act, 1956.
ELECTRONIC FILING:
Since SEBI has stipulated electronic filing of Annual Report including Corporate Governance Report, Shareholding
Pattern etc. on website of SEBI i.e. www.sebiedifar.nic.in statements of your company will also be accessible at this
website. These statements are also displayed on your company’s website viz. www.kewalkiran.com.
LISTING FEES:
The equity shares of your company are listed on the Bombay Stock Exchange Limited and National Stock Exchange
of India Limited. Your company has paid the applicable listing fees to the above Stock Exchanges upto date.
DEMATERIALISATION OF SHARES:
Your company has entered into agreements with the National Securities Depository Limited (NSDL) and Central
Depository Services (India) Limited (CDSL) for dematerialization of the shares of the company. Accordingly the shares
of your company are available for dematerialization and can be traded in Demat form.
AUDITORS:
Your company’s auditors M/s. Jain & Trivedi, Chartered Accountants and the joint auditors M/s. N.A. Shah Associates,
Chartered Accountants, retire at the conclusion of the ensuing Annual General Meeting of the company and being
eligible offer themselves for re-appointment.
PERSONNEL:
Employee relations continued to be cordial during the year ended March 31, 2007. Your Company continued its thrust
on Human Resource Development. Your company has initiated various customized training programs viz. personality
development, development of inter personal skills, communication skills, public speaking etc. for its employees that
enhance both personal as well career growth of the employees. These programs are conducted round the year by
professional trainers as well as by the human resource department of the company. Your company has also encouraged
its employees to attend seminars and discussions conducted by professional institutions and trade bodies. The Board
wishes to place on record its appreciation to all the employees of the company for their sustained efforts and immense
contribution to the high levels of performance and growth of the business during the year.
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INFORMATION UNDER SECTION 217 (2A) OF COMPANIES ACT, 1956 READ WITHCOMPANIES (PARTICULARS OF EMPLOYEES) RULES 1975:
Information in accordance with Section 217 (2A) of the Companies Act, 1956 read with the Companies (Particulars ofEmployees) Rules 1975 forms a part of the Directors Report for the year ended March 31, 2007. However pursuant tothe provisions of Section 219 (1)(b)(iv) of the Companies Act, 1956, the Directors Report and Statement of Accountsare being sent to all shareholders excluding the statement of particulars of employees under Section 217 (2A) of theAct. Any shareholder interested in obtaining a copy of the said statement may write to the Company Secretary at theregistered office of your Company.
INFORMATION UNDER SECTION 217 (1)(e) OF COMPANIES ACT, 1956 READ WITHCOMPANIES (DISCLOSURE OF PARTICULARS IN THE REPORT OF THE BOARD OFDIRECTORS) RULES 1988:
The information pursuant to Section 217(1)(e) of the Companies Act,1956, read with Companies (Disclosure ofParticulars in the report of the Board of Directors) Rules 1988 is given below:
A. CONSERVATION OF ENERGY
The operations of your company are not energy intensive. However wherever possible your company strives tocurtail the consumption of energy on a continued basis.
B. TECHNOLOGY ABSORPTION, ADAPTATIONS & INNOVATION: Not Applicable
C. FOREIGN EXCHANGE EARNINGS AND OUTGO:
Activities relating to exports, initiatives taken to increase exports, development of new export markets for productsand services and export plans.
Total Foreign Exchange used and earned
Total Foreign Exchange earnedRs. ’000
(FOB Value) 51,069/-
Total Foreign Exchange outgo 15,442/-
ACKNOWLEDGEMENTS:
The Board would like to place on record its sincere appreciation for the wholehearted support and contribution madeby its customers, its shareholders, and all its employees across the country, as well as the various GovernmentDepartments, Banks, Distributors, Suppliers and other business associates towards the conduct of efficient and effectiveoperations of your company.
For and on behalf of the Board
KEWALCHAND P. JAINChairman & Managing Director
Place : MumbaiDated : May 15, 2007
CERTIFICATE OF COMPLIANCE WITH THE CODE OF CONDUCT
I, Kewalchand P. Jain, Chairman & Managing Director of the company, hereby declare that the company has adopteda Code of Conduct for its Board Members and Senior Management, at a meeting of the Board of Directors held onJanuary 14, 2006 and the Board Members and Senior Management have affirmed compliance with the said Code ofConduct for the financial year ended March 31, 2007.
For Kewal Kiran Clothing Limited
KEWALCHAND P. JAINChairman & Managing Director
Place : MumbaiDated : May 15, 2007
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CORPORATE GOVERNANCE REPORT FOR THE YEAR 2006-07
I. COMPANY’S PHILOSOPHY ON CODE OF CORPORATE GOVERNANCE:
Kewal Kiran Clothing Ltd. is committed to good corporate governance in order to enhance shareholders’ value.The company believes that Corporate Governance is not an end in itself but a catalyst in the process towardsmaximization of shareholder value. The company’s philosophy on Corporate Governance enshrines the goal ofachieving the highest levels of transparency, accountability and equity in all spheres of its operations and in all itsdealings with the shareholders, employees, the Government and other parties. It is the company’s belief thatgood ethics make good business sense and our business practices are in keeping with the spirit of maintainingthe highest level of ethical standards.
In so far as compliance of Clause 49 of the Listing Agreement with the Stock Exchanges is concerned, thecompany has complied in all material respects with the requirements of Corporate Governance specified in theListing Agreement with Bombay Stock Exchange Ltd. and National Stock Exchange of India Limited.
II. BOARD OF DIRECTORS:
(a) Composition of the Board:
The Board of Directors of Kewal Kiran Clothing Limited have an optimum combination of executive and nonexecutive directors. As on March 31, 2007 the Board of Directors of the company comprises of the Chairmanand Managing Director, Mr. Kewalchand P. Jain, who is an executive director and one of the promoters of thecompany. Besides, there are three executive directors viz. Mr. Hemant P. Jain, Mr. Dinesh P. Jain and Mr.Vikas P. Jain, who are also the promoters of the company. The Board comprises of four non–executiveindependent directors, which accounts for fifty percent of the strength of Board. The non executive independentdirectors are eminent professionals with wide range of knowledge and experience in various spheres ofbusiness and industry, finance and law. The composition of the Board and other relevant details relating toDirectors as on March 31, 2007 are given below: –
Name of the Director Designation Category of ** No of ** No ofDirectorship other Committee
Directorship Chairmanship/membership
Mr. Kewalchand P. Jain Chairman & Promoter & 4 1Managing Director Executive
Mr. Hemant P. Jain Whole-time Promoter & 5 1Director Executive
Mr. Dinesh P. Jain Whole-time Promoter & 3 0Director Executive
Mr. Vikas P. Jain Whole-time Promoter & 3 0Director Executive
Mr. Popatlal F. Sundesha Director Independent 5 3Non Executive
Mr. Mrudul D. Inamdar Director Independent 1 1Non Executive
Dr. Prakash A. Mody Director Independent 10 1Non Executive
Mr. Nimish G. Pandya Director Independent 2 3Non Executive
** Details of other directorships/committee memberships of all directors are given by way of a separateAnnexure. The committee chairmanship/membership of the Directors are restricted to the chairmanship/membership of Audit Committee, Shareholders/Investors Grievance committee and RemunerationCommittee.
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(b) Number of Board Meetings held and attended by Directors.
(i) The meetings of the Board of Directors are scheduled well in advance. The Board Members are presentedin advance with the detailed agenda in respect of all Board meetings. During the year under review fivemeetings of the Board of Directors were held on the following dates: –
April 26, 2006, July 21, 2006, October 16, 2006, January 22, 2007 and March 3, 2007. The gap betweentwo board meetings is less than four months.
(ii) The attendance record of each of the Directors at the Board Meetings during the year ended on March31, 2007 and during the last Annual General Meeting is as under: –
Name of Director No. of Board Meetings Attended Attendance At The Last AGM
Mr. Kewalchand P. Jain 5 Present
Mr. Hemant P. Jain 5 Present
Mr. Dinesh P. Jain 5 Present
Mr. Vikas P. Jain 5 Present
Mr. Popatlal F. Sundesha 3 Present
Mr. Mrudul D. Inamdar 4 Present
Dr. Prakash A. Mody 2 Present
Mr. Nimish G. Pandya 4 Present
(c) Code of Conduct
In line with the company’s objective of following the best Corporate Governance Standards the Board ofDirectors have laid down a Code of Conduct for all Board Members and Senior Management of the company.The Code is effective from January 14, 2006.
(d) Details of shares held in the company as on March 31, 2007
Name of the Director Number of shares held
Mr. Kewalchand P. Jain* 6,11,250
Mr. Hemant P. Jain* 6,11,250
Mr. Dinesh P. Jain* 6,27,250
Mr. Vikas P. Jain* 6,27,250
Mr. Popatlal F. Sundesha** Nil
Mr. Mrudul D. Inamdar Nil
Dr. Prakash A. Mody 336
Mr. Nimish G. Pandya Nil
*Note:
Mr. K.P. Jain also holds 16,000 equity shares in his capacity of Karta of Kewalchand P. Jain H.U.F
Mr. H.P. Jain also holds 16,000 equity shares in his capacity of Karta of Hemant P. Jain H.U.F
Mr. D.P. Jain also holds 16,000 equity shares in his capacity of Karta of Dinesh P. Jain H.U.F
Mr. V.P. Jain also holds 16,000 equity shares in his capacity of Karta of Vikas P. Jain H.U.F
**Note:
Fulchand Exports Private Limited is the holder of 20,000 Equity Shares. Further, Fulchand Finance PrivateLimited is the holder of 20,000 Equity Shares. Mr. Popatlal Sundesha, Independant Non-Executive Directorof the company is a director & shareholder of Fulchand Finance Private Limited. Relatives of Mr. PopatlalSundesha are directors and shareholders of Fulchand Exports Private Limited.
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III. AUDIT COMMITTEE:
Constitution of Audit Committee: –
The Audit Committee was constituted on November 14, 2005 in accordance with Clause 49 of the Listing Agreement,consisting of three Directors all being non–executive and independent. The Committee consists of the followingnon executive independent directors:
Name of the Company Position Held
Mr. Mrudul D. Inamdar Chairman
Mr. Popatlal F. Sundesha Member
Mr. Nimish G. Pandya Member
Mr. Abhijit B. Warange, Company Secretary acts as the secretary of the Committee.
All the members of the Audit Committee are financially literate and Mr. M.D. Inamdar, Chairman of the AuditCommittee possesses financial/accounting expertise.
Meetings of Audit Committee: –
During the year ended 31st March, 2007, four Audit Committee meetings were held on April 26, 2006, July21,2006, October 16, 2006 and January 22, 2007. The attendance of each Audit Committee member is givenhereunder: –
Name of the Audit Committee Member No. of meetings held No. of meetings attended
Mr. Mrudul D. Inamdar 4 4
Mr. Popatlal F. Sundesha 4 3
Mr. Nimish G. Pandya 4 4
Attendees: -
The Audit Committee invites such of the executives and directors, as it considers appropriate to be present at itsmeetings. The Executive Directors, the Chief Financial Officer and the Statutory Auditors are the permanentinvitees to the Audit Committee meetings.
The terms of reference of the Audit Committee includes:
Powers
1. To investigate any activity within its terms of reference.
2. To seek information from any employee.
3. To obtain outside legal or other professional advice.
4. To secure attendance of outsiders with relevant expertise, if it considers necessary.
Roles
1. Oversight of the company’s financial reporting process and the disclosure of its financial information toensure that the financial statement is correct, sufficient and credible.
2. Recommending to the Board, the appointment, re-appointment and, if required, the replacement or removalof the statutory auditor and the fixation of audit fees.
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’sreport 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;
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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 forapproval.
6. Reviewing, with the management, performance of statutory and internal auditors, adequacy of the internalcontrol systems.
7. Reviewing the adequacy of internal audit function, if any, including the structure of the internal auditdepartment, staffing and seniority of the official heading the department, reporting structure coverage andfrequency 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 issuspected fraud or irregularity or a failure of internal control systems of a material nature and reporting thematter to the board.
10. Discussion with statutory auditors before the audit commences, about the nature and scope of audit as wellas 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.
13. Carrying out any other function as is mentioned in the terms of reference of the Audit Committee.
IV. REMUNERATION COMMITTEE:
Composition of committee
The Remuneration Committee was constituted on November 14, 2005. The Committee consists of the followingnon executive independent Directors:
Name of the Company Position Held
Mr. Nimish G. Pandya Chairman
Mr. Popatlal F. Sundesha Member
Dr. Prakash A. Mody Member
Mr. Abhijit B. Warange, Company Secretary acts as the secretary of the Committee.
The terms of reference of Remuneration Committee includes determining and reviewing the remuneration payableto managerial personnel and any revision thereof.
No meeting of the Remuneration Committee was held during the year ended March 31, 2007.
Details of sitting fees, remuneration etc., paid to Directors for the year ended March 31, 2007.
Name of the Director Sitting Fees Salary Perquisites Total
Mr. Kewalchand P. Jain Nil Rs. 24,00,000 Nil Rs. 24,00,000
Mr. Hemant P. Jain Nil Rs. 24,00,000 Nil Rs. 24,00,000
Mr. Dinesh P. Jain Nil Rs. 24,00,000 Nil Rs. 24,00,000
Mr. Vikas P. Jain Nil Rs. 24,00,000 Nil Rs. 24,00,000
Mr. Popatlal F. Sundesha Rs. 1,20,000 Nil Nil Rs. 1,20,000
Mr. Mrudul D. Inamdar Rs. 1,60,000 Nil Nil Rs. 1,60,000
Dr. Prakash A. Mody Rs. 40,000 Nil Nil Rs. 40,000
Mr. Nimish G. Pandya Rs. 1,60,000 Nil Nil Rs. 1,60,000
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Service contracts, notice period and severance fee
The appointment of the executive directors is governed by the Articles of Association of the company, the resolutionof the Board of Directors and the members.
There is no provision for severance fees.
Remuneration Policy of the company
Remuneration Policy for Executive Directors
The Board of Directors of the company presently comprises of four executive directors namely Mr. Kewalchand P.Jain, Chairman & Managing Director, Mr. Hemant P. Jain, Mr. Dinesh P. Jain and Mr. Vikas P. Jain Directors.
The remuneration of the executive directors is governed by the Articles of Association of the company, the resolutionof the Board of Directors and the members. The remuneration paid to the executive directors has been approvedby the members in the extra ordinary general meeting held on December 3, 2005. The details of the remunerationpaid to the executive directors have been detailed aforesaid.
Revisions, if any in the remuneration of the executive directors are deliberated by the Remuneration Committeeof the Board. Based on the recommendation of the Remuneration Committee, the Board decides on the revisionsubject to the shareholders approval.
Remuneration Policy for Non Executive Directors
Non Executive Directors of a company’s Board of Directors can add substantial value to the company throughtheir contribution to the Management of the company. In addition, they can safeguard the interest of the investorsat large by playing an appropriate control role. Non executive directors bring in their long experience and expertiseand add substantial value to the deliberations of the Board and its Committee.
Apart from receiving sitting fees for attending the Board/Committee meetings the non executive directors have noother pecuniary relationship or transaction with the company. The sitting fees paid to the non executive directorsis within the statutory limits prescribed under the Companies Act, 1956 for payment of sitting fees without theapproval of the Central Government.
V. SHAREHOLDERS AND INVESTORS GRIEVANCE COMMITTEE:
Composition of Committee:
The Shareholders and Investors Grievance Committee has been constituted to look into investors’ complaints/queries.
The Committee is headed by a non executive independent director and comprises of the following directors:
Name of the Company Position Held
Mr. Nimish G. Pandya Chairman
Mr. Kewalchand P. Jain Member
Mr. Hemant P. Jain Member
Mr. Abhijit B. Warange, Company Secretary acts as the secretary of the Committee.
The terms of reference of Shareholders and Investors Grievance Committee are to specifically look into theredressal of shareholders and investors complaints like transfer of shares, non receipt of balance sheet, nonreceipt of dividends, etc.
Status report of Investors complaints for the year ended March 31, 2007
No. of complaints received - 224
No. of complaints resolved - 224
No. of complaints pending - NIL
Name and Designation of the compliance officer:
Mr. Abhijit B. Warange – Company Secretary
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VI. GENERAL BODY MEETINGS:
Location, time and date where the three immediately preceding Annual General Meetings of the company wereheld are given below:
Financial Year Day & Date Time Venue
2003-04 Thursday, September 30, 2004 11.00 a.m. B 101, Synthofine Estate,Opp. Virwani Industrial Estate,Goregaon (E), Mumbai: 400 063
2004-05 Friday, September 30, 2005 11.00 a.m B 101, Synthofine Estate,Opp. Virwani Industrial Estate,Goregaon (E), Mumbai: 400 063
2005-06 Thursday, September 14, 2006 3.00 p.m Indian Education societies,Manik Sabhagriha,Opp Lilavati Hospital,Bandra Reclamation, Bandra(w),Mumbai : 400 050
Special Resolutions passed in previous three Annual General Meetings:-
15th Annual General Meeting: At this meeting one Special Resolution was proposed, seconded and passed withmore than three-fourths majority on show of hands. This special resolution was with regard to maintaining theRegister and Index of Members of the company with M/s. Intime Spectrum Registry Limited, Registrar and TransferAgents at their office situated at C-13, Pannalal Silk Mills Compound, L.B.S Marg, Bhandup (West), Mumbai400078.
Special Resolutions whether passed by postal ballot:
No special resolution was passed by postal ballot in the last Annual General Meeting and also no resolutionrequiring approval of shareholders by way of postal ballot is proposed to be passed in the ensuing Annual GeneralMeeting.
VI. DISCLOSURES:
(i) Disclosure regarding materially significant related party transaction: -
The Register of Contracts containing the transactions in which Directors are interested is placed before theBoard regularly for its approval. There are no materially significant related party transactions which havepotential conflict with the interest of the company at large. Transactions with related parties are disclosedseparately in note no. 12 of part B of Schedule 21 to the Accounts in the Annual Report.
(ii) No penalties or strictures have been imposed on the company by the Stock Exchanges or SEBI or any otherStatutory Authority on any matter related to capital market during the last three years.
(iii) The Board hereby confirms that no personnel have been denied access to the audit committee.
(iv) The company has complied with all the mandatory requirements of Clause 49 of the Listing Agreement.Except for the composition of the Remuneration committee of the Board of Directors, the company has notadopted any other non mandatory requirements of Clause 49 of the Listing Agreement.
VII. MEANS OF COMMUNICATION:
The results of the company for the financial year ended March 31, 2007 are published in The Economic Timesand Navbharat Times. The results of the company are normally published in The Economic Times/The Free PressJournal and Maharashtra Times/Navbharat Times/Navshakti. The financial results and other information aredisplayed on the company’s website viz. www.kewalkiran.com The company also displays official news releaseson its website for the information of its shareholders/investors. Even presentations made to institutional investorshave been displayed on the website of the company.
The company does not have the system of intimating shareholders individually of its quarterly/half–yearly results.However, investors/shareholders desirous of getting the quarterly/half yearly unaudited results are given copiesthereof after consideration of results by the Board and publication in newspapers.
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The company has been complying with the provisions of Clause 51 of the Listing Agreement pertaining to ElectronicData Information Filing & Retrieval (EDIFAR) System since March, 2006. The audited financial results of thecompany for the financial year ended March 31, 2007 have been uploaded on the EDIFAR web site. The samehas also be uploaded on the company’s website viz. www.kewalkiran.com
The Management discussion and Analysis Report forms a part of the Annual Report.
VIII. GENERAL SHAREHOLDERS’ INFORMATION:
a) Annual General Meeting:
Date & Time : August 7, 2007 at 3.00 p.m.
Venue : M. C. Ghai Hall, Bhogilal Hargovindas Building, 2nd floor, 18/20,Kaikhushru Dubash Marg, (Behind Prince of Wales Museum) Mumbai - 400 001.
b) Financial Year: April 1 to March 31
c) Dates of Book Closure: July 25, 2007 to August 7, 2007 (both days inclusive)
d) Dividend payment date:
Dividend when sanctioned by shareholders will be made payable on or after August 13, 2007.
e) Listing on Stock Exchanges:
The equity Shares of the company got listed on April 13, 2006 and continue to be listed at the following StockExchanges: –
Bombay Stock Exchange Ltd., Mumbai, Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai: 400001.
National Stock Exchange of India Ltd., Exchange Plaza, Bandra Kurla Complex Bandra (E), Mumbai: 400051.
Note:
Listing fees for the financial year 2007–08 has been paid to both the stock exchanges i.e Bombay StockExchange Ltd. and National Stock Exchange of India Ltd.
f) Stock Code/Symbol:
The Stock Exchange, Mumbai : 532732
The National Stock Exchange : KKCL
ISIN No. : INE401H01017
g) Market Price Data:
The monthly high & low quotations of the company’s shares traded on the Bombay Stock Exchange Limitedand the National Stock Exchange of India Limited during the financial year 2006-2007 are as under:
Months BSE NSE
High Low High Low
April 2006 359.00 241.00 359.00 237.25
May 2006 374.50 207.55 372.95 208.50
June 2006 248.00 153.50 239.50 145.00
July 2006 219.00 163.00 207.20 164.10
August 2006 208.00 166.05 208.00 167.00
September 2006 206.00 182.65 204.85 182.00
October 2006 270.40 186.00 270.35 187.10
November 2006 274.00 228.00 274.90 227.10
December 2006 239.00 205.10 238.00 205.60
January 2007 270.00 217.15 270.00 219.00
February 2007 254.00 211.00 254.00 210.20
March 2007 224.00 177.60 223.95 171.50
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h) Performance in comparison to broad based indices:
* Shares of the company were listed w.e.f. April 13, 2006.
i) Registrar & Share Transfer Agents:
Intime Spectrum Registry LimitedC-13, Pannalal Silk Mills Compounds,L.B.S. Marg, Bhandup (West),Mumbai-400078
Tel: +91 22 2594 6970-77Fax: +91 22 2596 2691Email: rnt.helpdesk@intimespectrum.comWebsite: www.intimespectrum.com
j) Share Transfer System:
Shares held in the dematerialised form are electronically traded in the Depositories and the Registrar andShare Transfer Agents of the company, viz. Intime Spectrum Registry Limited periodically receive from theDepository the beneficial holdings data, so as to enable them to update their records and to send all corporatecommunications, dividend warrants etc. Physical shares received for dematerialisation are processed andcompleted within a period of 15 days from the date of receipt provided they are in order in every respect. Baddeliveries are immediately returned to Depository participants under advice to the shareholders within theaforesaid period.
Transfers in Physical forms are registered by the registrar and transfer agents immediately on receipt of thecompleted documents and certificates are issued within one month of the date of lodgment of transfer.Invalid share transfer are returned within fifteen days of receipt.
k) Distribution Pattern of shareholding as on March 31, 2007:
No of equity No. of % of No. of %shares shareholders shareholding shares held
1–5000 10194 97.51 44,73,450 3.63
5001–10000 96 0.92 7,59,670 0.62
10001–20000 48 0.46 7,61,710 0.62
20001–30000 20 0.19 5,27,590 0.43
30001–40000 11 0.11 3,97,080 0.32
40001–50000 21 0.20 10,32,500 0.84
50001–100000 22 0.21 18,90,380 1.53
100001 & above 42 0.40 11,34,07,990 92.01
Total 10454 100.00 12,32,50,370 100.00
*Apr-06 May-06 Jun-06 Jul-06 Aug-06 Sep-06 Oct-06 Nov-06 Dec-06 Jan-07 Feb-07 Mar-07*Apr-06 May-06 Jun-06 Jul-06 Aug-06 Sep-06 Oct-06 Nov-06 Dec-06 Jan-07 Feb-07 Mar-07
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Shareholding Pattern as on March 31, 2007.
Category No. of Shares % to total
Indian Promoters 8790000 71.318
Mutual Funds 1578739 12.809
FI’s and Banks 12000 0.097
FII’s 203000 1.647
NRI 13785 0.112
Bodies Corporate 532281 4.319
Independent Director 336 0.003
Clearing Members 2074 0.017
Public 1192822 9.678
Total 12325037 100.00
As per Regulation 3 of SEBI Takeover Code, 1992 as amended upto date, group companies includeKornerstone Retail Limited, Kewal Kiran Retail India Pvt. Ltd., Kewal Kiran Realtors Pvt. Ltd. and WhiteKnitwears Pvt. Ltd. as also the firm viz. Kewal Kiran Enterprises.
Shareholding pattern graph as on March 31, 2007.
l) Dematerialisation of equity shares:
The shares of the company are compulsorily traded in dematerialised form and are available for tradingunder both the Depository Systems –NSDL (National Securities Depository Limited ) and CDSL (CentralDepository Services (India) Limited ). Nearly 26.57 % of total equity shares of the company are held indematerialised form with NSDL & CDSL as on March 31, 2007.
Liquidity
Kewal Kiran Clothing Limited Shares are actively traded on Bombay Stock Exchange Ltd. and NationalStock Exchange of India Ltd.
m) Outstanding GDRS/ADRS/Warrants or any Convertible Instruments conversion date and likely impacton equity:
The company has not issued any GDRS/ADRS/Warrants or any convertible instruments.
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n) Plant Locations:
VapiPlot No. 787/1, 40, ShedIInd Phase, G.I.D.CVapi - 396 195.Gujarat
Daman697/3/5/5A, Near Maharani Estate,Somnath Road, DhabelDaman - 396 210.
MumbaiSynthofine Estate,Opp Virwani Industrial EstateGoregaon (East),Mumbai - 400 063.
71-73, Kasturchand Mill EstateBhawani Shankar Road,Dadar (West),Mumbai - 400 028.
o) Address for Investor Correspondence:
Shareholding related queriesIntime Spectrum Registry LimitedC-13, Pannalal Silk Mills Compounds,L.B.S. Marg, Bhandup (West),Mumbai - 400 078.Tel: +91 22 2594 6970-77Fax: +91 22 2596 2691Email: rnt.helpdesk@intimespectrum.comWebsite: www.intimespectrum.com
General correspondenceKewal Kiran Estate,Behind Tirupati Udyog,460/7, I.B. Patel Raod,Goregain (East), Mumbai - 400 063Tel: +91 22 26814400Fax: +91 22 26814410Email: abhijitw@kewalkiran.comWebsite: www.kewalkiran.com
p) Investors grievance redressal:
An exclusive e-mails ID, grievanceredressal@kewalkiran.com for redressal of investor complaints hasbeen created. In case of any queries/complaints or grievances then please write to us atgrievanceredressal@kewalkiran.com
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ANNEXURE TO CORPORATE GOVERNANCE REPORT
DETAILS OF OTHER DIRECTORSHIPS/COMMITTEE MEMBERSHIPS OF ALL DIRECTORS
[1] BODIES CORPORATE OF WHICH MR. KEWALCHAND P. JAIN IS A CHAIRMAN/DIRECTOR
Name of The Company Board Position Held
Kornerstone Retail Ltd. Chairman
Kewal Kiran Realtors Pvt. Ltd. Chairman
Kewal Kiran Retail India Pvt. Ltd. Chairman
White Knitwears Pvt. Ltd. Director
COMMITTEE MEMBERSHIPS
Name of The Company Name of the Committee Position Held
Kewal Kiran Clothing Ltd. Shareholders and Investors Grievance Committee Member
[2] BODIES CORPORATE OF WHICH MR. HEMANT P. JAIN IS A CHAIRMAN/ DIRECTOR
Name of The Company Board Position Held
Kornerstone Retail Ltd. Director
Synthofine Chemicals of India Ltd. Director
Kewal Kiran Realtors Pvt. Ltd. Director
Kewal Kiran Retail India Pvt. Ltd. Director
White Knitwears Pvt. Ltd. Director
COMMITTEE MEMBERSHIPS
Name of The Company Name of the Committee Position Held
Kewal Kiran Clothing Ltd. Shareholders and Investors Grievance Committee Member
[3] BODIES CORPORATE OF WHICH MR. DINESH P. JAIN IS A CHAIRMAN/DIRECTOR
Name of The Company Board Position Held
Kornerstone Retail Ltd. Director
Kewal Kiran Realtors Pvt. Ltd. Director
Kewal Kiran Retail India Pvt. Ltd. Director
[4] BODIES CORPORATE OF WHICH MR. VIKAS P. JAIN IS A CHAIRMAN / DIRECTOR
Name of The Company Board Position Held
Kornerstone Retail Ltd. Director
Kewal Kiran Realtors Pvt. Ltd. Director
Kewal Kiran Retail India Pvt. Ltd. Director
[5] BODIES CORPORATE OF WHICH MR. POPATLAL F. SUNDESHA IS A CHAIRMAN/DIRECTOR
Name of The Company Board Position Held
Apaksh Broadband Ltd. Director
Aksh Opti Fibre Ltd. Director
Aksh Broadband Ltd. Director
Derivium Capital & Securities Pvt. Ltd Chairman
Fulchand Finance Pvt. Ltd. Chairman
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COMMITTEE MEMBERSHIPS:
Name of The Company Name of the Committee Position Held
Kewal Kiran Clothing Ltd. Audit Committee Member
Kewal Kiran Clothing Ltd. Remuneration Committee Member
Aksh Opti Fibre Ltd. Audit Committee Member
[6] BODIES CORPORATE OF WHICH MR. MRUDUL D. INAMDAR IS A CHAIRMAN/DIRECTOR
Name of The Company Board Position Held
Kanbans Consultancy Services Pvt. Ltd. Director
COMMITTEE MEMBERSHIPS
Name of The Company Name of the Committee Position Held
Kewal Kiran Clothing Ltd. Audit Committee Chairman
[7] BODIES CORPORATE OF WHICH DR. PRAKASH A. MODY IS A CHAIRMAN/ DIRECTOR
Name of The Company Board Position Held
Unichem Laboratories Ltd. Chairman
Viramrut Investment Pvt. Ltd. Director
A.V.M. Investment Pvt. Ltd. Director
M. Investment Pvt. Ltd. Director
Pranit Share Trading Investment Pvt. Ltd. Director
Chevy Investments & Finance Pvt. Ltd. Director
Niche Generics Ltd. U.K Director
Unichem Farmaceutica Do Brazil Ltda. Director
Unichem SA (Pty) Ltd. Director
Unichem Pharmaceuticals (USA) Inc Director
COMMITTEE MEMBERSHIPS
Name of The Company Name of the Committee Position Held
Kewal Kiran Clothing Ltd. Remuneration Committee Member
[8] BODIES CORPORATE OF WHICH MR. NIMISH G. PANDYA IS A CHAIRMAN/ DIRECTOR
Name of The Company Board Position Held
Lipi Data Systems Pvt. Ltd. Director
Aasia Trade Development Pvt. Ltd. Director
COMMITTEE MEMBERSHIPS
Name of The Company Name of the Committee Position Held
Kewal Kiran Clothing Ltd. Remuneration Committee Chairman
Kewal Kiran Clothing Ltd. Shareholders and Investors Grievance Committee Chairman
Kewal Kiran Clothing Ltd. Audit Committee Member
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MANAGEMENT DISCUSSION AND ANALYSIS
1. Overview:
The Indian Apparel market is growing at the rate of about 15% in terms of value and about 5% in terms of volume.We are on the threshold of a retail revolution and the country is witnessing a high demand from blooming middleclass. This will offer immense opportunities for companies operating in domestic market. New business formatswill emerge out of these and in coming years business of brands will be consolidated from present fragmentedstage. In the last year Indian consumer has shown tendency of trading up and commitment to brands. It will takebetween five to ten years for Indian organized retail to achieve worthwhile share in the overall retail market.Following will be the key drivers of growth in the Indian Market:
� Higher disposable income
� Younger demographic
� Urban population
� Easy access to credit
� Surge in availability of quality retail space
Indian consumers will move up from being aspirants to consumers adding millions of new customers for brandedproducts.
As the government is preparing to open the doors of domestic apparel market for foreign players, we are witnessingannouncements from foreign players to enter Indian markets. With the changing Indian lifestyle customers willlook for aspiring/premium brands. We feel that this is a big opportunity for Indian players to grab their share of themarket.
2. Industry:
Indian market for apparel and accessories is estimated at Rs. 1,13,500 crores. Men’s wear accounts for 32 % ofthese. The market has recorded steady growth of 10 % to 12 % over last two years. Of the total apparel marketonly 13.60 % is organized, presenting a huge opportunity for the organized players as there will be logical shifttowards branded products by consumers.
Existing players in domestic and export apparel market have ambitious diversification and expansion plans.Companies are expanding their manufacturing capacities to meet the burgeoning demand. Government of Indiais also setting up various apparel parks, integrated textile parks and special economic zones in partnership withprivate sector. Most of the products in apparels category are de-reserved for all the sectors. Apparel industryneeds to focus on development of technology in cutting, stitching, processing and finishing machines. Indianplayers should also put more emphasis on brand building exercise with aggressive advertising and promotionplans.
3. Opportunities & Threats:
With the evolving opportunities in Indian retail market, players like KKCL with their integrated strengths will havean immense advantage over others. Our knowledge of latest manufacturing technology combined with best practicesin distribution and retail will allow us to strive ahead of competition. We have launched women’s wear and alsoplanning a range of Kid’s wear. Accessories and other life style products would also contribute in enhancingoverall customer experience for our brands.
India offers a never before opportunity for players in branded apparels. We have definite strengths in terms ofintegrated manufacturing from cutting to finishing, which gives us edge in terms of economies of scale and leadover others in terms of time to market. We employ latest available technology, these when coupled with theknowledge and productivity gives us a tremendous edge over competition.
We have four established brands KILLER, INTEGRITI, Pg3 LAWMAN & EASIES. They are extremely well acceptedamongst Indian consumers and enjoy a deserved reputation for superior quality. Our brands operate in differentdesign and price segments.
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We are aggressively expanding our retail operations under “K-Lounge” brand. K- Lounge retails stores sell ourapparel brands under one roof. During the current financial year we plan to open about 88 new retail storescomprising of K-Lounge stores & Exclusive Brand Outlets (EBO). We have planned 16 KILLER EBOs, 14 EBOeach for Pg3 LAWMAN and INTEGRITI and 1 Flagship store for EASIES. We have also identified and bookedmore than 40 stores across the country.
The biggest threat in our industry is not being able to understand the customer preference and trends. We willalso have to be well versed with best retail practices. Other constraining factors would be availability of qualityspace in time, trained manpower in retail etc.
4. Risks and Concerns:
There are risks which are inherent to the apparel industry, mainly, not being able to identify the consumerpreferences, forecasting the demand, timely delivery to the market etc. We also face the challenging supply chainissues related to the Indian supply chain. The apparels business is seasonal in nature & hence any adverse eventaffecting the overall economy affects our sales.
In terms of expansion of our retail business, biggest challenge lies in the availability of quality retail space andability of the developers to meet the delivery deadlines. Also in the current scenario getting and retaining trainedmanpower is a major concern.
5. Internal control systems and their adequacy:
We have proper and adequate system of internal control to ensure that all assets are safeguarded and protectedagainst any loss from unauthorized use or disposition and that transaction are authorized, recorded and reportedcorrectly, to keep constant check on the cost structures and to prevent revenue leakages. Our internal controlsystems are supplemented by an extensive programme of internal audit conducted by an internal team andexternal auditors and periodically reviewed by the management together with the Audit Committee of the Board.We place greater emphasis on internal controls across functions and processes, covering the entire gamut ofactivities including finance, supply chain, sales and distribution, marketing etc.
6. Company’s financial performance with respect to operational performance:
Our total revenue & profit after tax during the year was Rs. 1,336,194 thousand and Rs. 186,464 thousandrespectively. The revenue and net profit have grown by 55% and 60% respectively as compared to the last year.
During the year we were able to expand our manufacturing operations without compromising operational costefficiency. Our earnings before selling & distribution, interest & depreciation expenses (excluding other income)were about 35 % during the year.
During the year we have manufactured about 2.72 million and sold about 2.43 million garments.
7. Human Resources:
As on 31st March 2007, we had 1,652 employees. We are focused on attracting and retaining the best manpoweravailable. We strive to provide to our employees high degree of motivation, training and structured compensationpackage.
We have excellent industrial relations with all our employees at manufacturing facilities. Adequate safety andwelfare measures are in place and we will continue to improve the same on ongoing basis.
8. Cautionary Statements:
This discussion contains certain forward-looking statements within the meaning of applicable securities laws.Readers are cautioned not to place undue reliance on these forward looking statements, which reflectsmanagement’s analysis describing our objectives and expectations based on certain information and assumptions.Our operations are dependent on various internal and external factors within and outside the control of themanagement.
We assume no responsibility in respect of forward looking statements herein which may undergo changes infuture on the basis of subsequent developments, information or events.
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AUDITORS’ CERTIFICATE
To,
The Members ofKewal Kiran Clothing Limited
1. We have examined the compliance of conditions of corporate governance by Kewal Kiran Clothing Limited, forthe year ended on March 31, 2007, as stipulated in Clause 49 of the Listing Agreement of the said Company withstock exchanges.
2. The compliance of conditions of corporate governance is the responsibility of the management. Our examinationwas limited to procedures and implementation thereof, adopted by the Company for ensuring the compliance ofthe conditions of the Corporate Governance. It is neither an audit nor an expression of opinion on the financialstatements of the Company.
3. In our opinion and to the best of our information and according to the explanations given to us and representationsmade by the management, we certify that the Company has complied with the conditions of Corporate Governance,as stipulated in the abovementioned clause of the Listing Agreement, to the extent applicable.
4. We state that such compliance is neither an assurance as to the future viability of the Company nor the efficiencyor effectiveness with which the management has conducted the affairs of the Company.
For N.A. Shah Associates For Jain & TrivediChartered Accountants Chartered Accountants
Milan Mody Satish C. TrivediPartner PartnerMembership No. :- 103286 Membership No. :- 38317
Place: MumbaiDate : May 15, 2007
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AUDITORS’ REPORT
To,
The Members ofKewal Kiran Clothing Limited
1. We have audited the attached Balance Sheet of Kewal Kiran Clothing Limited as at March 31, 2007 and alsothe Profit and Loss Account for the year ended on that date and the Cash Flow Statement for the year ended onthat date both 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.
2. We conducted our audit in accordance with auditing standards generally accepted in India. Those standardsrequire that we plan and perform the audit to obtain reasonable assurance about whether the financial statementsare free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amountsand disclosures in the financial statements. An audit also includes assessing the accounting principles used andsignificant 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.
3. As required by the Companies (Auditor’s Report) Order 2003 as amended by the Companies (Auditor’s Report)(Amendment) order, 2004 issued by the Central Government of India in terms of sub-section (4A) of section 227of the Companies Act, 1956, we enclose in the Annexure a statement on the matters specified in paragraphs 4and 5 of the said Order.
4. Further to our comments in the Annexure referred to in paragraph 3 above, we report as follows:
a. we have obtained all the information and explanations, which to the best of our knowledge and belief werenecessary for the purposes of our audit;
b. in our opinion, proper books of account as required by law have been kept by the Company so far as appearsfrom our examination of those books;
c. the Balance Sheet and Profit & Loss Account and Cash Flow Statements dealt with by this report are inagreement with the books of account;
d. in our opinion, the Balance Sheet and Profit and Loss Account and Cash Flow Statement dealt with by thisreport comply with the Accounting Standards referred to in sub-section (3C) of Section 211 of the CompaniesAct, 1956;
e. on the basis of the written representation received from the directors, and taken on record by the Board ofDirectors, as on 31st March, 2007, we report that none of the directors is disqualified as on 31st March, 2007from being appointed as a director in terms of clause (g) of sub-section (1) of section 274 of the CompaniesAct, 1956;
f. in our opinion and to the best of our information and according to the explanations given to us, the saidaccounts read together with Significant accounting policies and notes to accounts give the information requiredby the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with theaccounting principles generally accepted in India:
i) in the case of Balance Sheet, of the state of affairs of the Company as at 31st March, 2007;
ii) in the case of Profit & Loss Account, of the profit of the Company for the year ended on that date; and
iii) in the case of Cash Flow Statement, of the cash flows for the year ended on that date.
For N.A. Shah Associates For Jain & TrivediChartered Accountants, Chartered Accountants,
Sandeep Shah Satish C. TrivediPartner PartnerMembership No.: 37381 Membership No.: 38317
Place: MumbaiDate: May 15, 2007
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ANNEXURE TO THE AUDITORS’ REPORT(Referred to in paragraph 3 of our report of even date)
(i) In respect of fixed assets:
(a) The Company has maintained proper records showing full particulars including quantitative details andsituation of its fixed assets.
(b) A portion of the fixed assets has been physically verified during the year by the management in accordancewith a phased programme for verification which, in our opinion, provides for physical verification of all the fixedassets at reasonable intervals having regards to the size of the Company and the nature of its assets. Accordingto the information and explanation given to us, no material discrepancies were noticed on such verification.
(c) Fixed assets disposed off during the year, in our opinion, do not constitute substantial part of the fixed assetsof the Company and such disposal has, in our opinion, not affected the going concern status of the Company.
(ii) In respect of its inventories;
(a) As explained to us, the inventories have been physically verified by the management during the year. In caseof stock lying at third parties, certificates confirming the stocks so held have been received from majority ofthe said parties.
(b) In our opinion and according to the information and explanations given to us, the procedures of physicalverification of inventory followed by the management are reasonable and adequate in relation to the size ofthe company and nature of its business.
(c) In our opinion and according to the information and explanations given to us, the company has maintainedproper records of its inventories. The discrepancies noticed on verification between the physical stocks andthe book records were not material.
(iii) In respect of loans taken / granted:
(a) According to the information and explanation given to us, the Company has not taken loans from companies,firms and other parties covered in the register maintained under section 301 of the Companies Act, 1956.
(b) According to the information and explanation given to us, the Company has not granted loans to Companies,firms, Directors and other parties covered in the register maintained under section 301 of the CompaniesAct, 1956.
(c) Since there are no loans taken or granted by the Company no comment is required for rate of interest andother terms and condition and of regularity in receipt /payment of principal and interest (clause 4(ii)(b, c, fand g) of the order)
(iv) In our opinion, and according to the information and explanations given to us, there are adequate internal controlprocedures commensurate with the size of the Company and nature of its business for the purchase of inventoryand fixed assets and for the sale of goods and services. During the course of our audit, we have not observed anycontinuing failure to correct major weaknesses in such internal controls.
(v) In respect of register maintained under section 301 of the Companies Act, 1956:
(a) Based on the information and explanations given to us, the transactions pertaining to contracts andarrangements that need to be entered into a register in pursuance of section 301 of the Companies Act,1956 have been so entered.
(b) According to information and explanation given to us, the transactions in respect of certain items of purchaseof goods made in pursuance of contracts or arrangements entered in the register maintained under section301 of the Companies Act, 1956 and aggregating during the year to Rs. 500,000/- or more in respect of eachparty have been made at prices which are reasonable having regard to the prevailing market prices and / orthe prices at which transactions of similar goods and materials have been made with other parties.
(vi) The company has not accepted any deposits as referred to in section 58 and 58AA of the Companies Act 1956.We are informed that no order relating to the Company has been passed by the Company law Board or NationalCompany Law Tribunal or Reserve Bank of India or any court or any other Tribunal.
(vii) In our opinion, the internal audit functions carried out during the year by a firm of Chartered Accountants appointedby the Company have been commensurate with the size of the Company and nature of its business.
(viii) As informed to us, the Central Government has not prescribed the maintenance of cost records under 209-(1) (d)of the Companies Act, 1956 for any of the products of the Company.
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(ix) In respect of statutory dues:
(a) According to the information and explanations given to us and on the basis of our examination of the booksof account, the Company has been regular in depositing undisputed statutory dues including InvestorEducation and Protection Fund, Income-tax, Sales-tax, VAT, Service Tax, Wealth Tax, Custom Duty, ExciseDuty, Cess and any other dues during the year with the appropriate authorities. In respect of Employees’State Insurance, Income Tax collected at source, Tax deducted at source and Service Tax there were minordelays in deposit of dues with the authorities during the year.
(b) According to information and explanations given to us, there are no disputed Sales-tax, VAT, Wealth Tax,Service Tax, Excise duty and Cess as on March 31, 2007. The details of disputed Income-tax , and customduty which have not been deposited as on March 31, 2007 are given as follows:
Name of the Statute Nature of Dues Amount Period to which Forum where dispute(in Rs.) it relates is pending
Income Tax Act 1961 Tax liability 685,277 Assessment Commissioner ofyear 2001-02 Income Tax Appeals
Tax liability 109,146 Assessment Income Tax Appellateyear 2002-03 Tribunal
Tax liability 112,792 Assessment Commissioner ofyear 2003-04 Income Tax (Appeals)
Customs Duty Penalty 3,219,700 Assessment Addl.DGFT (Delhi)year1996-97
(x) The Company does not have any accumulated losses at the end of the financial year and has not incurred cashlosses during the financial year covered by our audit and the immediately preceding financial year.
(xi) Based on our audit procedures and the information and explanations given by the management, we are of theopinion that the Company has not defaulted in repayment of dues to bank during the year.
(xii) According to the information and explanations given to us, the Company has not granted loans and advances onthe basis of security by way of pledge of shares, debentures and other securities.
(xiii) The Company is not a chit fund / nidhi / mutual benefit fund / society.
(xiv) The Company has maintained proper records of transactions and contracts in respect of investments in Mutual Fundsand timely entry has been made therein. All the Investments made by the company are in the name of the Company.
(xv) According to the information and explanations given to us, the Company has not given any guarantee for loanstaken by others from banks or financial institutions.
(xvi) To the best of our knowledge and belief and according to the information and explanation given to us, in ouropinion, term loans availed by the Company were, prima facie, applied for the purposes for which the loans wereobtained, other than temporary deployment pending application.
(xvii) On the basis of our examination of Cash Flow Statement, the funds raised on short-term basis have not beenused for long term investments, as they have been financed out of internal accruals.
(xviii) The Company has not made any preferential allotment of shares during the year.
(xix) According to the information and explanation given to us the Company has not issued any debentures.
(xx) We have verified the end use of money raised by public issue in the previous year and the same is disclosed innotes to the financial statements (Note B -3 of Schedule 21)
(xxi) To the best of our knowledge and belief and according to the information and explanations given to us, no fraudon or by the Company has been noticed or reported during the year.
For N.A. Shah Associates For Jain & TrivediChartered Accountants, Chartered Accountants,
Sandeep Shah Satish C. TrivediPartner PartnerMembership No.: 37381 Membership No.: 38317
Place: MumbaiDate: May 15, 2007
34 16th Annual Report
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As at March 31,
Schedule 2007 2006
Rs. ’000 Rs. ’000
SOURCES OF FUNDS
SHAREHOLDER’S FUNDS
Share Capital 1 123,250 92,250
Share Application Money Pending Allotment – 806,010(Refer Note B - 1 to Schedule 21)
Reserves and surplus 2 1,137,026 275,987
1,260,276 1,174,247
LOAN FUNDS
Secured loans 3 208,440 163,867
DEFERRED TAX LIABILITIES (NET) – 1,295(Refer Note B - 15 to Schedule 21)
TOTAL 1,468,716 1,339,409
APPLICATION OF FUNDS
FIXED ASSETS 4
Gross block 384,211 226,420
Less : Depreciation (79,648) (51,026)
Net block 304,563 175,393
Capital work-in-progress 1,976 76,035
306,539 251,428
INVESTMENTS 5 71,948 23,009
DEFERRED TAX ASSETS (NET) 13,672 –(Refer Note B - 15 to Schedule 21)
CURRENT ASSETS, LOANS AND ADVANCES:
Inventories 6 248,227 137,165
Sundry debtors 7 249,264 131,594
Cash and bank balances 8 678,598 4,828,437
Loans and advances 9 53,662 39,153
1,229,751 5,136,349
LESS: CURRENT LIABILITIES AND PROVISIONS 10
Liabilities 114,779 4,090,236
Provisions 38,415 28,565
153,194 4,118,801
NET CURRENT ASSETS 1,076,557 1,017,548
MISCELLANEOUS EXPENDITURE 11 – 47,423
TOTAL 1,468,716 1,339,409Notes to Financial Statements 21
As per our report of even date
For and on behalf of For and on behalf of
N. A. Shah Associates Jain & Trivedi For and on behalf of the Board
Chartered Accountants Chartered Accountants
Sandeep Shah Satish C. Trivedi Kewalchand P. Jain Hemant P. Jain Abhijit B. Warange
Partner Partner Chairman & Whole-time Company Secretary
Membership No. : 37381 Membership No. : 38317 Managing Director Director
Place: Mumbai Place: Mumbai
Date : May 15, 2007 Date : May 15, 2007
BALANCE SHEET AS AT MARCH 31, 2007
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PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED MARCH 31, 2007For the year ended March 31,
Schedule 2007 2006
Rs. ’000 Rs. ’000
INCOMESales and service charges 12 1,336,194 859,638
Other income 13 74,777 7,156
1,410,971 866,794EXPENDITURE
(Increase) / decrease in stocks 14 (116,476) (79,611)Cost of material consumed 15 670,489 438,560Purchase of Trading material 5,739 3,045Personnel Cost 16 134,844 91,693Manufacturing and operating expenses 17 114,838 73,122Administrative and other expenses 18 73,621 39,320Selling and distribution expenses 19 200,677 93,989Finance expenses 20 15,845 10,785Depreciation 4 29,619 13,903
1,129,196 684,805
Net Profit Before Tax and Prior Period items 281,775 181,989
Provisions for Taxation
Current tax [including Rs.50 thousand(P.Y.Rs.50 thousand) for Wealth Tax] 94,500 60,400
Deferred tax (391) 1,446
Fringe Benefit Tax 1,200 800
Net Profit after tax and before Prior Period Items 186,466 119,343
Prior Period Item:
Depreciation for earlier years – 4,331
Deferred Tax effect on depreciation for earlier years – (1,458)
Excess Provision for tax in earlier years – (25)
Net Profit after Prior Period items 186,466 116,495
Balance brought forward 133,932 78,517Appropriations:
Bonus Shares Issued – 30,000
Proposed Dividend 30,813 18,488
Tax on proposed dividend 5,237 2,593
Transfer to General Reserves 20,000 10,000
Balance carried to balance sheet 264,349 133,932
Earnings per Share - Basic & Diluted 15.17 17.81
(Refer Note B - 14 to Schedule 21)
Notes to Financial Statements 21
As per our report of even date
For and on behalf of For and on behalf of
N. A. Shah Associates Jain & Trivedi For and on behalf of the Board
Chartered Accountants Chartered Accountants
Sandeep Shah Satish C. Trivedi Kewalchand P. Jain Hemant P. Jain Abhijit B. Warange
Partner Partner Chairman & Whole-time Company Secretary
Membership No. : 37381 Membership No. : 38317 Managing Director Director
Place: Mumbai Place: Mumbai
Date : May 15, 2007 Date : May 15, 2007
36 16th Annual Report
Making growth fashionable.
For the year ended March 31,
2007 2006
Rs. ’000 Rs. ’000
A. CASH FLOW FROM OPERATING ACTIVITIES
Net Profit before taxes as per Profit and Loss Account 281,775 181,990
Adjustments for:
Depreciation 29,619 13,903
(Profit)/Loss on Sale of Fixed Assets (518) (186)
(Gain)/Loss on Redemption of Mutual Fund (186) (40)
Sundry Balance written off 13 202
Interest paid 14,089 8,236
Dividend income on mutual fund (4,870) (751)
Exchange Rate Fluctuation (1,058) 940
Provision for Doubtful Debts 850 –
Provision for Dimunition in Value of Inventory 1,100 –
Exchange Rate Fluctuation 23 –
Rent income (9,970) –
Interest earned (54,286) (2,459)
(25,193) 19,845
Operating Profit before Working Capital Changes 256,582 201,835
Adjustments for:
Trade and other receivables (123,564) (119,818)
Inventories (112,163) (108,815)
Trade payables and other liabilities 28,924 53,209
(206,803) (175,424)
Cash generated from Operations 49,779 26,411
Direct Taxes (94,233) (54,568)
Net Cash utilised in Operating Activities (44,454) (28,157)
B. CASH FLOW FROM INVESTING ACTIVITIES
Purchase of Fixed Assets (88,769) (140,065)
Sale of Fixed Assets 2,135 791
Investments in Joint Venture (3,300) –
Sale of Investment – 24,800
Gain on Redemption of Mutual Fund 186 40
Dividend Received 4,870 751
Loans given – (48)
Recovery of Loans given 48 13,552
Interest received 54,286 –
Less : Direct Tax 18,273 –
36,013 2,459
Rent Income 9,970
Less : Direct Tax 2,036 7,934 –
Net Cash utilised in Investing Activities (40,883) (97,720)
STATEMENT OF CASH FLOW
3716th Annual Report
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For the year ended March 31,
2007 2006
Rs. ’000 Rs. ’000
C. CASH FLOW FROM FINANCING ACTIVITIES
Secured Loans taken 90,358 158,005
Secured Loans repaid (99,993) (48,026)
Secured Loans - Bank OD (Net) 56,428 (729)
Unsecured loans taken – 149,236
Unsecured loans repaid – (161,116)
Interest paid (13,912) (6,304)
Exchange Rate Fluctuation (1,163) (605)
Share Issue Expenses (54,338) (23,747)
Proceeds from issue of shares – 98,625
Repayment of Application Money (3,975,163) –
Proceeds from Share Application Money pending Allotment – 806,010
Proceeds from Share Application Money pending refund – 3,975,429
Payment of Dividend (Including Dividend Tax) (21,080) –
Net Cash generated in Financing Activities (4,018,863) 4,946,778
NET INCREASE IN CASH AND CASH EQUIVALENTS (4,104,200) 4,820,901
CASH AND CASH EQUIVALENTS - OPENING BALANCE 4,851,447 30,546
CASH AND CASH EQUIVALENTS - CLOSING BALANCE 747,246 4,851,447
Notes:
1 Fixed deposits of Rs.19,589 thousand (P.Y. Rs.19,506 thousand) are under lien. Refer Schedule 8
2 Cash and Cash Equivalents includes Rs. 265 thousand (P.Y. Rs. 4,781,439, thousand) lying in Escrow Account
3 The Cash flow statement is prepared under ‘indirect method’ as set out in Accounting Standard - 3 on Cash FlowStatements issued by the Institute of Chartered Accountants of India.
4 Previous year’s figures have been regrouped, whereever necessary.
STATEMENT OF CASH FLOW
As per our report of even date
For and on behalf of For and on behalf of
N. A. Shah Associates Jain & Trivedi For and on behalf of the Board
Chartered Accountants Chartered Accountants
Sandeep Shah Satish C. Trivedi Kewalchand P. Jain Hemant P. Jain Abhijit B. Warange
Partner Partner Chairman & Whole-time Company Secretary
Membership No. : 37381 Membership No. : 38317 Managing Director Director
Place: Mumbai Place: Mumbai
Date : May15, 2007 Date : May15, 2007
38 16th Annual Report
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As at March 31,
2007 2006
Rs. ’000 Rs. ’000
SCHEDULE - 1
SHARE CAPITAL
Authorised capital
20,000,000 (P.Y 20,000,000) equity shares of Rs.10 each 200,000 200,000
Issued and subscribed :
12,325,037 (P.Y. 9,225,000) equity shares of Rs.10 each 123,250 92,250
(of the above 3,000,000 shares are allotted as fully paid up
by way of bonus shares by Capitalisation of Profits)
123,250 92,250
SCHEDULE - 2RESERVES AND SURPLUS
Securities Premium Account
Opening Balance 132,055 –
Add: Addition during the year 775,009 132,055
Less: Application towards Share issue expenses
(Net of Deferred Tax of Rs. 13,698 thousand) 64,387 –
(Refer Note B - 2 to Schedule 21)
842,677 132,055
Genaral Reserve
Opening Balance 10,000 –
Add: Transfer from Profit & Loss account 20,000 10,000
30,000 10,000
Closing Balance in Profit and Loss account 264,349 133,932
1,137,026 275,987
SCHEDULE - 3
SECURED LOANS
1) Term Loan from Bank 59,282 70,000
(Amount due within a year Rs. 12,681 thousand P.Y. Nil)
2) Foreign Currency Demand Loan 43,473 44,610
(Amount due within a year Rs. 43,472 thousand P.Y. Rs. 44,610 thousand)
3) Working capital loans from Banks 105,685 49,257
208,440 163,867
Note:
Loans mentioned in 1, 2 and 3 above are secured by lien on deposits in
favour of bank, mortgage of commercial property, stock and receivables
and personal guarantee of some of the Directors.
SCHEDULES ‘1’ TO ‘21’ ANNEXED TO AND FORMING PART OF THE BALANCE
SHEET AS AT MARCH 31, 2007 AND THE PROFIT & LOSS ACCOUNT FOR THEYEAR ENDED MARCH 31, 2007.
3916th Annual Report
Making growth fashionable.
SCHEDULE - 4
SCHEDULE OF FIXED ASSETS
Rs. ’000
Sr Description of the GROSS BLOCK DEPRECIATION NET BLOCK
No. Block of Assets As at Additions Deduc- As at Upto Depre- Deduc- As at As at As at31/03/06 during tions 31/03/07 31/03/06 ciation tions 31/03/07 31/03/07 31/03/06
the year during during during
the year the year the year
Tangible Asset
1 Free Hold Land – 10,437 – 10,437 – – – – 10,437 –
2 Leasehold Land 1,574 – – 1,574 19 19 – 38 1,536 1,556
3 Building 120,451 113,170 – 233,621 25,932 10,035 – 35,967 197,654 94,518
4 Furnitures & Fixtures 38,065 10,907 – 48,972 5,885 7,311 – 13,196 35,776 32,180
5 Plant and Machinery 42,634 21,124 2,280 61,478 13,515 6,759 845 19,429 42,049 29,119
6 Computer 6,950 2,783 161 9,572 2,445 2,226 125 4,546 5,026 4,505
7 Office Equipments 8,893 1,280 186 9,987 732 1,609 28 2,313 7,674 8,161
8 Vehicles 7,018 – – 7,018 2,350 1,209 – 3,558 3,460 4,668
Intangible Asset
9 Software 835 717 – 1,552 150 452 – 601 951 686
Total 226,420 160,418 2,627 384,211 51,028 29,619 998 79,648 304,563 175,393
Previous Year 108,694 118,604 878 226,420 33,065 18,234 272 51,028 175,393
As at March 31,
2007 2006
Rs. ’000 Rs. ’000
SCHEDULE - 5INVESTMENTS
(Refer Note B - 17 to Schedule 21)
LONG TERM INVESTMENTS
In Equity shares, Fully paid (unquoted)
White Knit Wear Private Limited 3,300 –
(330,000 (P.Y. Nil) Shares of face value Rs. 10 each)(Refer Note B - 16 to Schedule 21)
In Mutual Funds
Kotak Liquid (Institutional Fund) – 447[Units: Nil (P.Y. 44,558.63) Net Asset Value Nil (P.Y. Rs.446 thousand)]
UTI - Money Market Fund – 22,563[Units: Nil (P.Y.1,294,747.60) Net Asset Value Nil (P.Y. Rs.22,565 thousand)]
Birla Fixed Term Plan-Quarterly Series7 30,000 –[Units: 3,000,000 (P.Y. Nil) Net Asset Value Rs. 30,061 thousand (P.Y. Nil)]
Birla Sunlife Cash Manager 10,039 –[Units: 1,003,675.94 (P.Y. Nil) Net Asset Value Rs. 10,039 thousand (P.Y. Nil)]
LIC MF Liquid Fund 28,609 –[Units: 2,606,965.59 (P.Y. Nil) Net Asset Value Rs.28,624 thousand (P.Y. Nil)]
71,948 23,009
40 16th Annual Report
Making growth fashionable.
As at March 31,
2007 2006
Rs. ’000 Rs. ’000
SCHEDULE - 6
INVENTORIES
(As taken, valued and certified by the management)
Finished goods [Includes Stock in transit of Rs. Nil (P.Y. Rs.2,427 thousand)] 140,005 42,080
Work-in-process 70,045 51,495
Raw material 27,114 34,892
Packing material & Accessories 8,913 6,423
Stores, chemicals and consumables 2,150 2,275
248,227 137,165
SCHEDULE - 7
SUNDRY DEBTORS
a) Over Six Months(Unsecured)
i) Considered Good 6,824 2,850
ii) Doubtful 850 –
b) Other Debts (Unsecured, Considered Good) 242,440 128,743
250,114 131,594
Less : Provision for Doubtful Debts 850 –
249,264 131,594
SCHEDULE - 8
CASH & BANK BALANCES
Cash on hand 1,157 1,081
Bank balances with scheduled banks :-
In current accounts 13,891 6,064
In Public Issue Escrow Accounts 266 4,781,439
In fixed deposits 663,284 39,854
[Out of the above Fixed deposits under lien are Rs.19,589 thousand(P.Y. Rs.19,505 thousand)]
678,598 4,828,437
SCHEDULE - 9
LOANS AND ADVANCES
(Unsecured, considered good except otherwise stated)(Refer Note B - 7 to Schedule 21)Loans given to employees 2,532 2,814
Loan given to others 500 548
Deposits [Includes deposits with directors Rs.324 thousand,(P.Y. Rs. 324 thousand)] 31,896 24,036
Advances recoverable in cash or in kind or for value to be received 6,546 9,729
Advance for capital expenditure 1 2,026
Advance tax / tax deducted at source (Net of Provision) 12,186 –
53,662 39,153
4116th Annual Report
Making growth fashionable.
As at March 31,
2007 2006
Rs. ’000 Rs. ’000
SCHEDULE - 10
CURRENT LIABILITIES & PROVISIONS
(A) Liabilities :
Sundry creditors for capital expenditure 3,409 7,843
Sundry creditors for materials & services 39,816 31,723
Sundry creditors for expenses 54,082 39,299
Security Deposit 6,300 6,300
Advance from customers 10,907 5,342
Share issue expenses payable – 24,301
Excess Share Application Money to be refunded 266 3,975,429
114,779 4,090,236
(B) Provisions :
Proposed Dividend 30,813 18,488
Tax on proposed dividend 5,237 2,593
Taxation (Net of taxes paid) – 5,526
Employee benefits 2,366 1,958
38,415 28,565
TOTAL (A + B) 153,194 4,118,801
Note :
i There are no amounts due & outstanding to be credited to InvestorEducation & Protection fund as at March 31, 2007.
ii Refer Note B - 8 to Schedule 21 for details on Small Scale IndustrialUnits
SCHEDULE - 11
MISCELLANEOUS EXPENDITURE
(to the extent not written off or adjusted)
Share Issue Expenses – 47,423
– 47,423
42 16th Annual Report
Making growth fashionable.
As at March 31,
2007 2006
Rs. ’000 Rs. ’000
SCHEDULE - 12
SALES & SERVICES
Sales (Net of trade discount,allowances,etc) 1,336,194 852,668
Service charges – 6,970
1,336,194 859,638
SCHEDULE - 13
OTHER INCOME
Interest on bank deposits 54,210 2,100
[(Tax Deducted at Source - C.Y Rs. 12,142 thousand(P.Y. Rs. 403 thousand)]
Interest - others 76 359
[(Tax Deducted at Source - C.Y. 12 thousand (P.Y. Rs. 75 thousand)]
Gain on Redemption of Mutual Funds 186 40
Dividend income on mutual fund 4,870 751
Profit on Sale of Assets (net) 518 186
Export Incentives (net) 3,259 3,477
Rent Income 9,970 –
[(Tax Deducted at Source - C.Y. 2,237 thousand (P.Y. Nil)]
Sundry Income 630 243
Exchange Rate fluctuation on FCNR term Loan 1,058 –
74,777 7,156
SCHEDULE - 14
INCREASE / (DECREASE) IN FINISHED & PROCESS STOCK
Opening stock
Work - in- Process 51,495 4,555
Finished goods 42,080 9,408
93,575 13,963
Closing Stock
Work - in- Process 70,045 51,495
Finished goods 140,006 42,080
210,051 93,575
116,476 79,611
4316th Annual Report
Making growth fashionable.
As at March 31,
2007 2006
Rs. ’000 Rs. ’000
SCHEDULE - 15
COST OF MATERIAL
a. Raw Material Consumed:
Opening stock 34,892 12,402
Add: Purchases 417,093 356,307
451,985 368,709
Less: Closing stock 27,114 34,892
424,871 333,816
b. Semi-finished material 91,609 3,974
c. Packing material, Accessories and other cost 115,147 70,310
d. Stores, chemicals and consumables 38,862 30,459
670,489 438,560
SCHEDULE - 16
PERSONNEL COST
Salary, wages and other amenities to staff 117,564 80,962
(Refer Note B - 9 to Schedule 21)
Contribution to Provident and other funds 9,342 5,284
Gratuity 1,110 1,109
Bonus and ex-gratia 5,434 3,489
Leave salary 1,394 849
134,844 91,693
SCHEDULE - 17
MANUFACTURING EXPENSES
Embroidery expenses 5,298 2,331
Electricity expenses 8,495 7,215
Factory rent 2,590 2,285
General factory expenses 1,890 1,151
Processing charges 72,256 39,142
Loading and unloading charges 1,220 1,043
Fuel expenses 16,710 13,966
Water Charges 2,100 1,526
Waste Disposal Charges 1,009 1,090
Washing charges (including sub-contracting charges) – 234
Repairs to machinery 3,268 3,140
114,838 73,122
44 16th Annual Report
Making growth fashionable.
As at March 31,
2007 2006
Rs. ’000 Rs. ’000
SCHEDULE - 18
ADMINISTRATION & OTHER EXPENSES
Rent, Rates and Taxes 26,370 11,483
Communication expenses 3,359 2,081
Insurance premium 1,886 839
Legal, professional fees and consultancy charges 9,205 5,210
Postage, Printing and stationery 6,229 3,311
Donations 564 792
Vehicle expenses 1,022 954
Auditors Remuneration (Refer Note B - 10 to Schedule 21) 1,413 2,633
Conveyance 2,785 654
Electricity Expenses 3,015 704
Staff welfare 4,239 2,900
Repairs to building 1,589 1,650
Repairs & maintenance (others) 5,967 2,378
Sundry balance writen off 25 208
Directors Sitting Fees 480 420
General office expenses 4,623 3,101
Provision for Doubtful debts 850 –
73,621 39,320
SCHEDULE - 19
SELLING & DISTRIBUTION EXPENSES
Commission on sales 1,985 907
Discount and rebates on sales 43,714 8,405
Octroi, clearing and forwarding charges 7,317 5,202
Tour and travelling expenses 6,904 4,307
Advertisement and publicity expenses (Net of recoveries) 137,025 70,198
Sales promotion expenses 3,732 4,970
200,677 93,989
SCHEDULE - 20
FINANCE EXPENSES
Bank charges 1,312 1,356
Finance charges 761 252
Interest on Working Capital Loan 4,700 1,347
Interest on term loan 9,072 7,829
15,845 10,785
4516th Annual Report
Making growth fashionable.
SCHEDULE 21
NOTES FORMING PART OF FINANCIAL STATEMENTS FOR THE YEAR ENDED MARCH 31, 2007.
A. Significant Accounting Policies:
1. Basis of Accounting:
The Accounts have been prepared on accrual basis and under the historical cost convention, unless otherwisestated in accordance with the Companies Act, 1956 and the applicable Accounting Standards issued by theInstitute of Chartered Accountants of India.
2. Fixed Assets & Capital Work-in-Progress:
Fixed assets are stated at cost less depreciation and/or at recoverable value in case of impairment, if any.The cost of fixed assets includes interest on borrowings attributable to acquisition of fixed assets up to thedate of commissioning of the assets and other incidental expenses incurred up to that date.
Capital work-in-progress are carried at cost comprising direct cost, related incidental expenses and attributableinterest.
3. Depreciation/Amortization:
a) Depreciation is provided on written down value method at the rates prescribed under Schedule XIV ofthe Companies Act, 1956 for all assets except those given below.
b) Assets lying at retail stores are depreciated over a period of five years on straight–line basis.
c) Software is amortized over a period of three years on straight-line basis.
4. Impairment:
Impairment loss is recognized whenever the carrying amount of the asset is in excess of its recoverableamount and the same is recognized as an expense in the statement of profit and loss and the carryingamount of the asset is reduced to its recoverable amount.
5. Investments:
Long–term investments are valued at cost, less provision for permanent diminution in the value of investment.Current Investments are valued at cost or market value whichever is lower.
6. Inventories:
a) Raw material, packing material, accessories, stores and consumables are valued at cost
b) Work-in-process and finished products are valued at lower of cost and net realizable value
c) Unserviceable/damaged finished goods are valued at net realizable value.
d) Cost is ascertained on specific identification method and includes appropriate production overheads incase of Work-in-process and finished goods.
7. Foreign Currency Transactions:
Income and expenses in foreign currency are converted at rates prevailing as on the date of the transaction.Foreign currency monetary assets and liabilities are translated at the exchange rate prevailing as on thebalance sheet date and the resulting exchange differences are recognized in the profit and loss account.
8. Revenue Recognition:
a) Sales are recognized when significant risks and rewards of ownership of the goods have passed to thebuyer that coincides with delivery and are recorded net of trade discounts and rebates. Sales do notinclude inter divisional transfers.
b) Service charges are recognized after rendering of services.
c) Export incentives under the Duty Drawback Scheme are recognized on accrual basis in the year ofexport.
d) Interest income is recognized on accrual basis and Dividend income is accounted for when the right toreceive payment is established.
46 16th Annual Report
Making growth fashionable.
9. Retirement Benefits:
Retirement benefits are dealt with in the following manner:
a) Provident Fund is defined contribution plan and charged to profit and Loss Account on accrual basiswith corresponding contribution to recognized funds.
b) Gratuity is defined benefit plan and Payment for present liability of future payment of gratuity is made toan approved gratuity fund, which fully covers the said liability under Cash Accumulation Policy of LifeInsurance Corporation of India (LIC). The additional liability arising out of the difference between theactuarial valuation and the fund balance with the LIC, if any, is accrued at the year–end.
c) Leave encashment is short term employees benefit and determined arithmetically and charged to Profit& Loss Account on accrual basis
10. Taxes on Income:
Income tax expenses for the year comprises of current tax, deferred tax and fringe benefit tax. Current taxprovision has been determined on the basis of reliefs and deductions available under the Income Tax Act,1961. Deferred tax is recognized for all timing differences, subject to consideration of prudence, applying taxrates that have been substantively enacted by the Balance Sheet date.
11. Provisions and Contingent Liabilities:
Provisions are recognized when the company has a legal and constructive obligation as a result of a pastevent, for which it is probable that a cash outflow will be required and a reliable estimate can be made of theamount of the obligation.
Contingent liabilities are disclosed when the company has a possible obligation or a present obligation andit is probable that a cash outflow will not be required to settle the obligation.
12. Operating Lease:
Lease arrangements where risks and rewards incidental to ownership of an asset substantially vests withthe lessor are classified as operating lease.
Rental income and expense on assets given or obtained under operating lease arrangements are recognizedon a straight–line basis over the term of relevant lease.
B. Notes to Accounts:
1. Initial Public Offer :
Company had offered 3,100 thousand Equity Shares to the public for subscription in March 2006 through100% book building process. 3,100 thousand equity shares were allotted on 5th April 2006 to subscribers tothe issue at the premium of Rs.250 per share aggregating total amount to Rs. 806,010 thousand
2. Share issue Expenses:
In terms of Section 78 of the Companies Act, 1956, share issue expenses of Rs. 64,387 thousand (Net offdeferred tax of Rs. 13,698 thousand) was written off against securities premium account.
3. Details of IPO Proceeds Utilization:Rs.’000
Purpose of Utilization of Fund 31-03-2007 31-03-2006
Net Issue Proceeds 806,009 –Utilized as under:
Corporate Office 43,378 –
Setting up Retail Stores 51,054 –
Setting up Manufacturing Unit 63,584 –
Share Issue Expenses 78,085 –
Total Expenses 236,101 –
The balance Unutilised Proceeds are kept in Fixed Deposit with Scheduled Banks.
4716th Annual Report
Making growth fashionable.
4. Contingent Liabilities:
a. Disputed demands in respect of income tax not acknowledged as debt – Rs. 907 thousand (P.Y. Rs.5,449thousand).
b. Disputed demands in respect of Custom Duty against Advance License not acknowledged as debt –Rs. 3,219 thousand (P.Y. Rs. Nil)
c. The company has purchased capital assets under EPCG license against which the company has anexport obligation of Rs. 9,345 thousand (P.Y. Nil). Contingent liability, to the extent of duty saved inrespect of EPCG is Rs. 5,012 thousand (P.Y. Rs.1,152 thousand).
d. Bank guarantees of Rs. 977 thousand (P.Y. Rs. 4,437 thousand).
e. Letter of Credit of Rs. 1,132 thousand (P.Y. Rs. 1,622 thousand) discounted with Banks.
f. Letter of Credit of Rs. NIL (P.Y. Rs. 3,772 thousand) opened by the company with Banks.
Note:
Contingent Liabilities disclosed above represent possible obligations where the probability of cash outflow tosettle the obligation is remote.
5. The company has fulfilled its export obligation with regards to advance license/EPCG. However, the dischargefrom Custom authorities is still pending.
6. Estimated amount of contracts remaining to be executed on Capital Account and not provided for – Rs.15,846 thousand (net of advances paid) (P.Y. Rs. 1,516 thousand)
7. Loans and Advances includes amount due from:
Kornerstone Retail Ltd, a company under the same management – Rs. 1,441 thousand (P.Y. Rs.100 thousand)[Maximum amount due during the year Rs. 1,441 thousand (P.Y. Rs.22, 800 thousand)]
8. Dues to Small Scale Industrial Units:
As per the records available with the Company:
i. Sundry Creditors include Rs. 11,410 thousand (P.Y. Rs. 2,910 thousand) due to small scale industrialunits
ii. The list of Small Scale Industrial Units (SSI) in respect of which the amounts are due for more than 30days, as at March 31, 2007 are as under:
Accessories India Pvt. Ltd., Fashion Accessories India Pvt. Ltd., Jaj International, Riviera Fashion
9. Managerial Remuneration:Rs.’000
31-03-2007 31-03-2006
Managerial remuneration for directors (excluding provision for gratuityas separate actuarial valuation for the whole–time directors is not available) 9,600 9,600
Total 9,600 9,600
Note: Managerial remuneration is paid as per the provisions ofSection II of Part II of Schedule XIII to the Companies Act, 1956.
10. Auditors Remuneration:Rs.’000
31-03-2007 31-03-2006
As Auditors (includes service tax of Rs. 99 thousand P.Y. Rs.107 thousand) 899 982
For taxation matters (Includes service tax of Rs. 9 thousand P.Y. Nil) 166 151
For Others matters (includes service tax of Rs. 3 thousand , P.Y. 26 thousand) 124 286
1,188 1,419Share issue related services (Includes Service Tax 24 thousand P.Y.Rs.114 thousand) forming part of Miscellaneous Expenditure (Schedule 11) 224 1,214
Total 1,413 2,633
48 16th Annual Report
Making growth fashionable.
11. Segment Reporting:
a. Primary Segment:
The company is primarily engaged in single business segment of manufacturing and marketing ofapparel and is managed as one business unit.
b. Secondary Segment (By Geographical Segment):Rs. ’000
Particulars India Outside India Total
Sales and Services Income 1,284,930 51,264 1,336,194
(791,924) (67,714) (859,638)
Segment Assets * 1,606,676 1,562 1,608,238
(5,405,223) (5,564) (5,410,786)
(Figures in bracket indicate previous year’s figure)
Segment Assets from outside India represents receivables from Export Sales. In view of the interwoven /intermix nature of business and manufacturing facility, other information is not ascertainable.
12. Related Party Disclosure
a. Subsidiary
Kewal Kiran Retail India Private Limited (upto August 6, 2005)
Kornerstone Retail Limited (upto December 20, 2005)
b. Name of the enterprises having same Key Management Personnel and/or their relatives as thereporting enterprise:
Kewal Kiran Enterprises
Kewal Kiran Realtors Private Limited
Kewal Kiran Retail India Private Limited (w.e.f. August 7, 2005)
Kornerstone Retail Limited (w.e.f. December 21, 2005)
White Knitwear Private Limited
c. Relatives / Other concerns of key Management Personnel:
Shantaben P JainVeena K. JainLata H. JainSangita D. JainKesar V. JainPankaj K. JainHitendra H. JainArpita K. JainPukhraj K. Jain (HUF)Kewalchand P. Jain (HUF)Hemant P. Jain (HUF)Dinesh P. Jain (HUF)Vikas P. Jain (HUF)P.K. Jain family holding trust
d. Key Management Personnel:
Kewalchand P. Jain Chairman & Managing Director
Hemant P. Jain Whole-time Director
Dinesh P. Jain Whole-time Director
Vikas P. Jain Whole-time Director
4916th Annual Report
Making growth fashionable.
e. Rs. ’000
Nature of Transaction Subsidiaries Enterprises Relatives/Other Keyunder the Concerns of Key Management
Same Management Personnelmanagement Personnel
Service Charges received – – – –(–) (6,970) (–) (–)
Miscellaneous Purchase – 981 – –(129) (56) (–) (–)
Purchase of Assets – – – –(–) (19,819) (–) (–)
Investment in Equity Shares – 3,300 – –(22,800) (–) (–) (–)
Sale of Equity shares of Subsidiary – – –(–) (22,800) (–) (2,000)
Reimbursement received forAdvertisement expenses – – – –
(–) (6,162) (–) (–)
Security deposit given – – –(–) (–) (459) (324)
Security deposit Accepted[refer note (i) given below] – – – –
(4,800) (–) (–) (–)
Rent paid – – 918 2,828(–) (–) (274) (2,281)
Loans taken – –(–) (–) (34,339) (91,455)
Repayment of Loans taken – –(–) (–) (49,875) (173,478)
Managerial Remuneration – – – 9,600(–) (–) (–) (9,600)
Guarantee Given – – – –(30,000) (–) (–) (–)
Preferential Allotment of equity shares – – – –(–) (–) (8,252) (78,178)
Franchisee fees – 100 – –(–) (100) (–) (–)
Rent Received (–) 9,040 (–) (–)(–) (–) (–) (–)
Dividend Paid – – 9,470 3,716(–) (–) (–) (–)
Outstanding balance as on March 31, 2007
Sundry Creditors – 4,844 – 484– (4,821) (–) (291)
Loans and Advances – 1,441 – –(–) (100) (459) (324)
50 16th Annual Report
Making growth fashionable.
f. Disclosure of Related Party Transactions, the amounts of which are in excess of 10% of totalrelated party transactions of the same type:
Rs. ’000
Nature of Transaction Name of the related party Amount
Service Charges received Kewal Kiran Enterprises –(6,970)
Miscellaneous Purchase Kornerstone Retail Limited 981(185)
Purchase of Assets Kewal Kiran Enterprises –(19,819)
Investment in Equity Shares Kornerstone Retail Limited –(22,800)
White Knit wear Private Limited 3,300(–)
Sale of Equity shares of Subsidiary Kewal Kiran Retail India Pvt. Ltd. –(22,800)
Reimbursement received for Advertisement exp. Kewal Kiran Enterprises –(6,162)
Security deposit given Shantaben P Jain 459(459)
Kewalchand P. Jain 162(162)
Hemant P. Jain 162(162)
Security deposit Accepted Kornerstone Retail Limited –(4,800)
Rent paid Kewalchand P. Jain 961(709)
Hemant P. Jain 835(589)
Dinesh P. Jain 517(492)
Vikas P. Jain 517(492)
Shantaben P. Jain 918(274)
Loans taken Shantaben P Jain –(22,817)
Kewalchand P. Jain –(22,146)
Dinesh P. Jain –(37,150)
Vikas P. Jain –(27,393)
Repayment of Loans taken Shantaben P Jain –(26,425)
Kewalchand P. Jain –(33,963)
5116th Annual Report
Making growth fashionable.
Rs. ’000
Nature of Transaction Name of the related party Amount
Hemant P. Jain –(36,692)
Dinesh P. Jain –(60,146)
Vikas P. Jain –(42,677)
Managerial Remuneration Kewalchand P. Jain 2,400(2,400)
Hemant P. Jain 2,400(2,400)
Dinesh P. Jain 2,400(2,400)
Vikas P. Jain 2,400(2,400)
Guarantee Given Kornerstone Retail Limited –(30,000)
Preferential Allotment of Equity Shares Shantaben P Jain –(8,252)
Kewalchand P. Jain –(19,779)
Hemant P. Jain –(19,488)
Dinesh P. Jain –(19,455)
Vikas P. Jain –(19,455)
Rent Received Kornerstone Retail Limited 9,040(–)
Franchisee Fees Kornerstone Retail Limited 100(100)
Dividend Paid P.K.Jain Family holding trust 9,229(–)
Note :
Key Management Personnel have provided personal guarantee for bank loans obtained by the company.
(Figures in bracket indicate previous year’s figure)
13. Operating Lease Arrangements:
a. As lessee:
Rental expenses of Rs. 23,753 thousand (P.Y. Rs.10,012 thousand) in respect of obligation underoperating leases have been recognized in the profit and loss account.
At balance sheet date, minimum lease payments under non–cancelable operating leases fall due as follows:
Rs.’00031-03-2007 31-03-2006
Due not later than one year 39,203 13,060
Due later than one year but not later than five years 215,634 96,073
Later than five years 87,933 26,108
Total 342,770 135,241
52 16th Annual Report
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The above figures include:
i. Lease rentals calculated based on estimated date of commencement of lease in cases where theagreements / MOU’s have been entered into but the date of commencement of lease is dependent onthe date of construction/renovation of premises and based on the commitment for delivery by lessors.
ii. The afore–mentioned lease rentals include a lease the period of which is dependent on theoccurrence of an event, the date of which is not ascertainable beyond five years. Hence the leaserentals are considered up to a period of five years only.
iii. Lease rentals do not include common maintenance charges, tax payable, if any.
b. As lessor:
Rental Income recognized in the profit & Loss account during the year Rs. 9,970 thousand (P.Y. Nil)relating lease arrangements. At balance sheet date, Lease rent in respect of these leases will berecognized in the profit and loss account as follows:
Rs.’000
31-03-2007 31-03-2006
Due not later than one year – 8,800
Due later than one year but not later than five years – 20,000
Later than five years – –
Total – 28,800
14. Earnings per Share (EPS) are calculated as under:31-03-2007 31-03-2006
Net Profit after Tax and Prior Period Items Rs. 18,64,66,241 11,64,95,064
Weighted average number of Equity Shares Nos. 1,22,91,064 65,40,144
Basic & Diluted Earning per share Rs. 15.17 17.81
15. Deferred Tax:
In view of the Accounting Standard 22 issued by Institute of Chartered Accountants of India, the significant componentand classification of deferred tax liability/asset on account of timing difference comprises of the following:
Rs.’00031-03-2007 31-03-2006
Deferred Tax Asset:
Merger Expenses 20 40Share Issue Expenses 13,698 –Miscellaneous 2,915 –
Deferred Tax Liability:
Depreciation (2,962) (1,336)
Net deferred tax (liability)/asset 13,672 (1,295)
16. Joint Ventures Information:
Joint Venture, as required by (AS–27) “Financial Reporting of Interest in Joint Venture” is given below:
(i) Detail of Joint Venture Interest
Name Description of Country of Percentage of Percentage ofInterest Incorporation interest as on interest as on
31.03.2007 31.03.2006
White Knitwear P. Limited Equity Shareholding India 33.33% Nil
(ii) Company’s Interest in the Joint VentureRs.’000
Name As on Assets Liabilities For the Year Income Expenditure(Rs.) (Rs.) Ended (Rs.) (Rs.)
White Knitwear P. Limited 31.03.2007 3,176 46 31.03.2007 11 –(–) (–) (–) (–)
(Figures in bracket indicate previous year’s figure)
5316th Annual Report
Making growth fashionable.
The company’s share in the Contingent Liability and Capital Commitment of the Joint Venture are Rs. Nil andRs. 8,705/– respectively.
The above figures are based on latest available un–audited accounts of the Joint Venture.
17. Investments purchased and sold during the year:
Rs. ’000
Particulars Purchases Sale
No. of shares / (Rs.) No. of shares / (Rs.) units units
Kornerstone Retail Ltd(subsidiary and ceased to be such on sale) Nil Nil Nil Nil
(152) (22,800) (152) (22,800)
HDFC Cash Management Fund Nil Nil Nil Nil
(940) (10,001) (940) (10,001)
Kotak Liquid (Institutional) Fund 0.383 4 45 451
(818) (10,001) (818) (10,001)
UTI Liquid Cash Plan Institutional 31 539 1,326 23,182
(22) (22,519) (22) (22,514)
UTI Fixed Maturity Plan Nil Nil Nil Nil
(2,251) (22,514) (2,251) (22,534)
LIC MF Liquid Fund 13,537 148,504 10,930 12,000
(–) (–) (–) (–)
Birla Sun Life Cash Manager 2,006 20,062 1,002 10,024
(–) (–) (–) (–)
Birla Fixed Term Plan– Quarterly series 7 3,000 30,000 – –
(–) (–) (–) (–)
Kotak Liquid – Daily Dividend 4,172 51,015 4,172 51,015
(–) (–) (–) (–)
(Figures in bracket indicate previous year’s figure)
18. Value of Imports (C.I.F. Value):Rs. ‘000
31-03-2007 31-03-2006
Capital goods 7,520 –
Components and spare parts 363 121
Accessories 2,084 2,336
19. Expenditure in Foreign Currencies:Rs. ‘000
31-03-2007 31-03-2006
Travelling expenses 820 369
Advertisement expenses 2,069 2,829
Legal expenses 1,850 62
Others 737 328
20. Earnings in Foreign Exchange:Rs. ‘000
31-03-2007 31-03-2006
Export of goods (F.O.B. value) 51,069 66,652
54 16th Annual Report
Making growth fashionable.
21. Raw Material Consumed:
Rs. ’000
31–03–2007 31–03–2006
Material Measure Qty. (Rs.) Qty. (Rs.)
Woven Fabric Mtrs 3,403 428,142 2,511 325,999
Knitted Fabric Kgs. 12 1,326 39 7,817
429,468 333,816Semi–finished Pcs 295 90,933 ** 3,974
Packing material & Accessories ** ** 112,962 ** 70,310
Stores, chemicals and consumables ** ** 38,862 ** 30,459
Total 672,225 438,560
** Comprises of various items the value of which is less then 10% of the total Cost of Material.
22. Particulars of Finished Products:Rs. ’000
Opening stock Production Sales Closing stock
Qty. Value Qty. Qty. Value Qty. Value
Apparel 125 39,219 2,718 2,427 1,328,326 417 137,232
(28) (9,284) (1,671) (1,573) (851,609) (125) (39,219)
Note:
1. Figures in bracket indicate previous year’s figures
2. Sales includes samples distributed free of cost
3. Closing stock is after adjusting shortages on physical verification of inventories
23. Particulars of Trading ActivitiesRs. ’000
Opening stock Purchase Sales Closing stock
Qty. Value Qty. Value Qty. Value Qty. Value
Apparel
Nil Nil Nil Nil Nil Nil Nil Nil
(0.334) (124) (Nil) (Nil) (0.334) (227) (Nil) (Nil)
Accessories 49 2,941 21 5,739 34 7,868 31 3,423
(Nil) (Nil) (61) (3,045) (12) (833) (49) (2,941)
(Figures in bracket indicate previous year’s figure)
24. Due to acquisition of business unit during the previous year, the figures of the previous year are not strictlycomparable.
25. Previous year’s figures are regrouped, rearranged or recast wherever considered necessary.
As per our report of even date
For and on behalf of For and on behalf of
N. A. Shah Associates Jain & Trivedi For and on behalf of the Board
Chartered Accountants Chartered Accountants
Sandeep Shah Satish C. Trivedi Kewalchand P. Jain Hemant P. Jain Abhijit B. Warange
Partner Partner Chairman & Whole-time Company Secretary
Membership No. : 37381 Membership No. : 38317 Managing Director Director
Place: Mumbai Place: Mumbai
Date : May 15, 2007 Date : May 15, 2007
5516th Annual Report
Making growth fashionable.
ADDITIONAL INFORMATION PURSUANT TO PART IV OF SCHEDULE VI OFTHE COMPANIES ACT, 1956.
Balance Sheet abstract and Company’s general business profile
I Registration Details
Registration No. 6 5 1 3 6 State Code 1 1
Balance Sheet date 3 1 0 3 2 0 0 7
II Capital Raised During the Year (Amount in Rs. Thousand )
Public Issue N I L Rights Issue N I L
Bonus Issue N I L Private Placement N I L
III Position of Mobilisation and Deployment of Funds (Amount in Rs Thousand )
Total Liabilities 1 4 6 8 7 1 6 Total Assets 1 4 6 8 7 1 6
Sources of Funds
Paid -up Capital 1 2 3 2 5 0 Reserves & Surplus 1 1 3 7 0 2 6
Secured Loans 2 0 8 4 4 0 Unsecured Loans N I L
Deferred tax Liability N I L
Application of Funds
Net Fixed Assets 3 0 6 5 3 9 Investments 7 1 9 4 8
Net Current Assets 1 0 7 6 5 5 7 Misc. Expenditure N I L
IV Performance of Company (Amount in Rs. Thousand)
Turnover (Incl. Other Income) 1 4 1 0 9 7 1 Total Expenditure 1 1 2 9 1 9 6
Profit / Loss Before Tax 2 8 1 7 7 5 Profit / Loss After Tax 1 8 6 4 6 6
Earning per share 1 5 . 1 7 Dividend Rate % 2 5
V Generic Name of Principal Product / Service of Company (as per monetary terms)
Item Code No. (ITC Code): 6 2 0 4 6 2 1 1
Product description : Men Trouser 100% Cotton
Earning Per share
Basic 1 5 . 1 7
Diluted 1 5 . 1 7
Net Profit / (Loss)(Rs. in thousands)
Basic 1 8 6 4 6 6
Diluted 1 8 6 4 6 6
Average no. of shares (Rs. 10/- each)
Basic 1 2 2 9 1 0 6 4
Diluted 1 2 2 9 1 0 6 4
Signatures to Schedules and Notes
As per our report of even date
For and on behalf of For and on behalf of
N. A. Shah Associates Jain & Trivedi For and on behalf of the Board
Chartered Accountants Chartered Accountants
Sandeep Shah Satish C. Trivedi Kewalchand P. Jain Hemant P. Jain Abhijit B. Warange
Partner Partner Chairman & Whole-Time Company Secretary
Membership No. : 37381 Membership No. : 38317 Managing Director Director
Place: Mumbai Place: Mumbai
Date : May 15, 2007 Date : May 15, 2007
NOTES
56 16th Annual Report
Making growth fashionable.
KEWAL KIRAN CLOTHING LIMITEDRegd. Office: B101-107, Synthofine Estate, Opp. Virwani Industrial Estate,
Goregaon (East), Mumbai: 400 063
ATTENDANCE SLIP
Folio No. ____________________________ No. of shares held. _____________________
# D.P. Id _____________________________
# Client Id ___________________________
Name and Address of the shareholder: _____________________________________________________________
_____________________________________________________________
I certify that I am a registered shareholder/proxy for the registered shareholder of the Company. I hereby record mypresence at the 16th Annual General Meeting of the company on Tuesday, August 7, 2007 at M.C. Ghia Hall, Bhogilal
Hargovindas Building, 2nd Floor, 18/20, Kaikhushru Dubash Marg, (Behind Prince of Wales Museum) Mumbai: 400 001
at 3.00 p.m.
Signature of the attending member/proxy
# Applicable for shareholders holding shares in electronic form.
Note:
1. Please sign this attendance slip and hand it over at the verification counter at the entrance of the meeting hall.
2. No gifts/company products shall be given at the meeting.
3. This attendance is valid only in case shares are held on the date of meeting.
KEWAL KIRAN CLOTHING LIMITEDRegd. Office: B101-107, Synthofine Estate, Opp. Virwani Industrial Estate,
Goregaon (East), Mumbai: 400 063
PROXY
Folio No. ____________________________ No. of shares held. _____________________
# D.P. Id _____________________________
# Client Id ___________________________
I/We ___________________________________ resident of _______________________________________ being a
member/members of M/s. KEWAL KIRAN CLOTHING LIMITED hereby appoint _____________________________
resident of ______________________________ failing him ____________________________________ resident of
as my/our proxy to attend and vote on my/our behalf at the 16th Annual General Meeting of the company to be held on
Tuesday, August 7, 2007 at M.C. Ghia Hall, Bhogilal Hargovindas Building, 2nd Floor, 18/20, Kaikhushru Dubash Marg,
(Behind Prince of Wales Museum) Mumbai: 400 001 at 3.00 p.m. and any adjournment thereof.
Signed this ____________ day of _______ 2007 Signature(s)
# Applicable for shareholders holding shares in electronic form.
Note : 1. The Proxy need NOT be a member.
2. The Proxy Form signed across Rs. 1/- revenue stamp should reach the Company’s Registered Officeatleast 48 hours before the scheduled time of meeting.
3. This form is to be used in favour of / against the resolution. Unless otherwise instructed, the proxy willvote as he thinks fit.
AffixRs. 1/-
RevenueStamp
Valid upto March 31, 2008
Valid upto March 31, 2008
Valid upto March 31, 2008
Valid upto March 31, 2008
Terms and Conditions:
Redeemable against purchases at K-Lounge stores only.
This offer cannot be clubbed with any other offer.
This voucher is non-encashable or refundable.
Discount coupon purchases shall not be acceptable during the annual or any other sale period at K-Lounge stores.
Discount coupon must be presented intact at the time of purchase.
Validity of the coupon will not be extended and no duplicate coupon will be issued.
Photocopy of the discount coupon will not be accepted.
Not more than one discount coupon can be redeemed against a single purchase.
Disputes, if any rising out of or in conjunction with or as a result of this offer or otherwise relating hereto shall be subject to theexclusive jurisdiction of the competent courts/tribunals in Mumbai only.
Pleas visit the company’s website www.kewalkiran.com for details of K-Lounge stores.
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Terms and Conditions:
Redeemable against purchases at K-Lounge stores only.
This offer cannot be clubbed with any other offer.
This voucher is non-encashable or refundable.
Discount coupon purchases shall not be acceptable during the annual or any other sale period at K-Lounge stores.
Discount coupon must be presented intact at the time of purchase.
Validity of the coupon will not be extended and no duplicate coupon will be issued.
Photocopy of the discount coupon will not be accepted.
Not more than one discount coupon can be redeemed against a single purchase.
Disputes, if any rising out of or in conjunction with or as a result of this offer or otherwise relating hereto shall be subject to theexclusive jurisdiction of the competent courts/tribunals in Mumbai only.
Pleas visit the company’s website www.kewalkiran.com for details of K-Lounge stores.
�
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Terms and Conditions:
Redeemable against purchases at K-Lounge stores only.
This offer cannot be clubbed with any other offer.
This voucher is non-encashable or refundable.
Discount coupon purchases shall not be acceptable during the annual or any other sale period at K-Lounge stores.
Discount coupon must be presented intact at the time of purchase.
Validity of the coupon will not be extended and no duplicate coupon will be issued.
Photocopy of the discount coupon will not be accepted.
Not more than one discount coupon can be redeemed against a single purchase.
Disputes, if any rising out of or in conjunction with or as a result of this offer or otherwise relating hereto shall be subject to theexclusive jurisdiction of the competent courts/tribunals in Mumbai only.
Pleas visit the company’s website www.kewalkiran.com for details of K-Lounge stores.
�
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�
�
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Terms and Conditions:
Redeemable against purchases at K-Lounge stores only.
This offer cannot be clubbed with any other offer.
This voucher is non-encashable or refundable.
Discount coupon purchases shall not be acceptable during the annual or any other sale period at K-Lounge stores.
Discount coupon must be presented intact at the time of purchase.
Validity of the coupon will not be extended and no duplicate coupon will be issued.
Photocopy of the discount coupon will not be accepted.
Not more than one discount coupon can be redeemed against a single purchase.
Disputes, if any rising out of or in conjunction with or as a result of this offer or otherwise relating hereto shall be subject to theexclusive jurisdiction of the competent courts/tribunals in Mumbai only.
Pleas visit the company’s website www.kewalkiran.com for details of K-Lounge stores.
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