| SPEECH OF SHRI N. D. SARAF, CHAIRMAN OF THE COMPANY AT THE 11TH ANNUAL GENERAL MEETING OF THE COMPANY HELD AT THE REGISTERED OFFICE OF THE COMPANY AT 46 A & B MIDC INDUSTRIAL ESTATE, HINGNA ROAD, NAGPUR (MAHARASHTRA) ON 11TH SEPTEMBER, 2014.
I welcome all of you to the 11th Annual General Meeting of the Company.
The Annual Report along with the Directors' Report and the Audited Accounts for the year ended 31st March, 2014 have already been circulated to all of you concerned and with your permission, I shall take them as read.
The production, sales and financial performance of your company for the year 2013-14 is already discussed in the Director’s Report present before you and hence the same is not repeated.
The financial year 2013-14 was very tough period for the company as the steel plant of the company remained closed for most of the time during the year. Your company had declared consensus lock-out in its steel plant in January, 2013 owing to lack of financial resources and lower demand in the market for its products. The lockout was lifted after Bankers approved the CDR Package for the company, however inspite of having received restructured financial package from the Bankers, your company was not able to carry out its operations properly due to continued recessionary trend that prevailed through out the financial year in the market. The capacity utilization of the plant declined significantly then the anticipated levels and this in tern was resulting into heavy cash losses for the company. By the end of the financial year the entire net-worth of the company got eroded and debt trap was looming large over the company due to dried up liquidity position.
Under these conditions your company had no other option, then to shut down the operations of its steel plant, till the time conditions in the marker improved. Accordingly, with the help of its workers and staff, the company once again declared consensus lock-out in its steel plant w.e.f 30th May, 2014.
Inspite of its best efforts and infusion of funds by the Promoters over the last several years, your company has not been able to arrest losses and as a result the entire net-worth of the company has been eroded during the financial year 2013-14 and the company has become a sick company as defined under section 3(1)(o) of Sick Industrial Companies (Special Provisions) Act, 1985 (SICA). In accordance with the provisions of Section 15(1) of SICA, your company has filed a reference with Hon’ble Board for Industrial and Financial Reconstruction (BIFR), New Delhi, within 60 days from the date of finalization of duly audited accounts of the company and reasons for erosion of net-worth has been explained in detail in the Director’s Report sent to all the shareholders.
The Management of the company is constantly exploring various alternatives to revive the operations of the company and believes that there could be increase in demand for steel products in coming future, which may revive the fortunes of your company.
Before I conclude, I express my deep sense of gratitude & indebtness towards our fellow employees and workers who stood by our side and supported wholeheartedly the company’s decision to lock-out operations second time in span on one year, even at their own cost to secure a better future for the company. I specially thank CDR Cell and our Bankers for standing by us and lending us much needed support and finance in tough time and believing in our ability and sincerity to revive the operations of the company while restructuring our debt and business. I also extend my gratitude to our investors, bankers and business partners who have endowed their faith on us and have stood by us through the ups and downs. I would also take this opportunity to thank all the members on the Board for their valuable advice, guidance and support.