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<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
<strong>Clariant</strong> Chemicals (India) Limited
<strong>Clariant</strong> Chemicals (India) Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
We enhance the quality of your life!<br />
<strong>Clariant</strong>’s products span across a wide spectrum<br />
of applications. You could find us in the most<br />
unexpected areas, right from the wrinkle<br />
free fabric, to the scratch free automotive<br />
coatings, in the special pharma and plastic<br />
packaging, on the leather sofas or in the heavy<br />
metal free paints. Our initiatives on quality,<br />
creating a broad range of green products, work<br />
place ethics and safety help strengthen our<br />
partnership with all of our stakeholders upon<br />
whom our success depends. Ultimately we<br />
strive to provide sustainable partnerships and<br />
make our world a better place!
Index<br />
2<br />
Corporate Management<br />
7 Financial Performance<br />
9 Notice<br />
13 Directors’ <strong>Report</strong><br />
17 Management Discussion and Analysis<br />
22 <strong>Report</strong> on Corporate Governance<br />
31 Auditors’ <strong>Report</strong><br />
34 Balance Sheet<br />
35 Profit and Loss Account<br />
36 Cash Flow Statement<br />
38 Schedules to Balance Sheet<br />
44 Schedules to Profit and Loss Account<br />
46 Notes<br />
58 Statement relating to the Subsidiary Company<br />
59 Chemtreat Composites India Private Limited (Subsidiary)<br />
67 Auditors’ <strong>Report</strong> on Consolidated Financial Statements<br />
68 Consolidated Financial Statements<br />
88 10-years’ Highlights
2 <strong>Clariant</strong> Chemicals (India) Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
Corporate Management<br />
Peter Palm R.A. Shah Diwan A. Nanda<br />
Bansi S. Mehta Henri Schloemer B.L. Gaggar Heiner Meier
3<br />
AUDIT COMMITTEE<br />
R.A. Shah, Chairman<br />
Diwan A. Nanda<br />
Henri Schloemer<br />
INVESTORS’ GRIEVANCE COMMITTEE<br />
Diwan A. Nanda, Chairman<br />
Peter Palm<br />
AUDITORS<br />
Deloitte Haskins & Sells<br />
Chartered Accountants<br />
BANKERS<br />
The Hongkong & Shanghai Banking Corpn. Ltd.<br />
Standard Chartered Bank<br />
Citibank N.A.<br />
SOLICITORS & ADVOCATES<br />
Crawford Bayley & Co.<br />
REGISTRAR & SHARE TRANSFER AGENTS<br />
BOARD OF DIRECTORS<br />
R.A. Shah – Chairman<br />
Peter Palm – Vice-Chairman & Managing Director<br />
Bansi S. Mehta<br />
Diwan A. Nanda<br />
Heiner Meier<br />
Henri Schloemer<br />
Dr. Andreas Walde<br />
B.L. Gaggar – Director Finance & Company Secretary<br />
Sharepro Services (India) Pvt. Ltd.<br />
Sakinaka, Andheri (E)<br />
Mumbai – 400 072<br />
REGISTERED OFFICE<br />
Ravindra Annexe<br />
194, Churchgate Reclamation<br />
Mumbai – 400 020<br />
WORKS<br />
Dhatav, Roha, Dist. Raigad – 402 116<br />
Balkum, Thane – 400 608<br />
Kolshet Road, Thane – 400 607<br />
Kudikadu, SIPCOT P. O., Cuddalore – 607 005<br />
Singadivakkam Village, Kanchipuram – 631 561
4 <strong>Clariant</strong> Chemicals (India) Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
Exacting Solutions …<br />
<strong>Clariant</strong>’s customers span across a wide range of businesses that<br />
are the market leaders in their own ways. Our diversity highlights our<br />
varied expertise and domain knowledge available for meeting the<br />
specialized demands of the industry.<br />
<strong>Clariant</strong>’s textiles business, a respected market leader in India, supplies<br />
not just specialty chemicals for pretreatment, dyeing, printing and<br />
finishing but also has the ability to impart special effects, from crease<br />
resistance to moisture management as well as repellency. We cater to<br />
varied segments like casual wear, sportswear, denim, business wear,<br />
work wear, towels, upholstery, sarees and dress materials, medical<br />
garments, textiles for cars, planes, trains and carpets.<br />
<strong>Clariant</strong> is the leading manufacturer and supplier of pigments and<br />
its preparations – be it for paints, plastics, printing inks, cosmetics,<br />
detergents or special applications like latex, viscose or waxes.<br />
Our high performance pigments meet the exacting demands of the<br />
automotive, coil and coating industries. The halogen-free flame<br />
retardants from the additives range are used for protective coatings,<br />
resins, thermoplastics and polyester fibers.<br />
Our paper specialties business is the preferred supplier of optical<br />
brighteners, colorants and functional chemicals that impart superior<br />
whiteness, color, coating and strength solutions for the paper market.<br />
Our focused product range enhances both optical and functional<br />
properties of all kinds of paper and board. We cater to segments<br />
like: printing & writing, coated paper, tissue & toweling, packaging &<br />
board, newsprint, among others.<br />
<strong>Clariant</strong> is a leading supplier of leather chemicals and services in India,<br />
offering chemical and technical solutions for the complete leather<br />
manufacturing process, from beamhouse to finishing. We meet the<br />
exacting demands of segments like automotive, shoe & fancy goods,<br />
furniture, garment, fur, etc.
5<br />
Our emulsions business is a major supplier of polymer dispersions to<br />
paints, coatings, construction and adhesive industries. In water-based<br />
wood coatings, the products have low VOC, no smell and quick drying,<br />
thereby meeting the local demands of the industry. They also provide<br />
good block resistance with enhanced gloss on wood and metals.<br />
<strong>Clariant</strong> masterbatches has been recognized as an important specialty<br />
and tailor made masterbatch supplier for the plastics industry. We<br />
meet the exacting demands in many application areas like: automotive,<br />
personal care, food & beverage, medical products, toys, fibers &<br />
filaments, packaging film & sheet, agriculture applications, etc.<br />
One of <strong>Clariant</strong>’s unique area of expertise is the high quality multifunctional<br />
anti-graffiti coatings which are also corrosion resistant and<br />
easy to clean. These find wide applications on the exteriors of railway<br />
coaches, automobile bodies, etc.<br />
The industrial & consumer specialties business is a global leader. Its<br />
personal care business develops and produces specialty ingredients<br />
and co-surfactants for skin and hair care, wet wipes and selected<br />
pharmaceutical applications. The industrial and home care business<br />
manufactures products for household cleaning fluids and disinfectant<br />
applications. Our emulsifiers, lubricants and corrosion inhibitors<br />
offer solutions for the lubricant and metal working fluid applications,<br />
while our brake fluids meet the automotive industry’s demand. Our<br />
industrial biocides are technology leaders in the coating segment.<br />
We work closely with our customers - both multinational brands and<br />
regional brands - to ensure performance, cost-efficiency and ecofriendliness.<br />
Delivering personalized and high performance solutions through<br />
close customer relationships which add value for our customers is<br />
our hallmark.
6 <strong>Clariant</strong> Chemicals (India) Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
… for a better tomorrow!<br />
Our basket of innovative products aim at ensuring our contribution to the broader sustainable development of the world we live in.<br />
Eco-friendly solutions are integral to our pigment range – be it the lead/chrome/heavy metal free pigments for paints or the flame retardants that<br />
are increasingly finding usage in varied applications, especially in the infrastructure sector in India. Our solutions also help conserve energy,<br />
avoid excess usage and are VOC free. Our water-based emulsions are another example.<br />
<strong>Clariant</strong>’s textile chemicals, especially for baby-wear, shirtings, bed-sheets, denims and trouser fabrics are compliant to global norms like<br />
Oekotex, GOTS, EU legislations, etc. The 4E concept focuses on environment, efficiency, ecology and economy. The multi-functional anti-graffiti<br />
coatings feature eco-friendly/energy savings and include non-fluorine compounds in formulations. Our specialized paper chemicals are wellsuited<br />
for manufacture of recycled paper as. The leather product range provides environment-friendly value-added solutions for the specific<br />
needs of the industry.<br />
<strong>Clariant</strong>’s skin care formulations are based on raw materials from renewable resources; recycling concepts are used for aviation de-icing<br />
products, which are promoted under our ECOTAIN label. Surfactant chemistry based on ethoxylates and specialty polyglycols offer state-of-theart<br />
solutions for the current demands of the Indian market; e.g. VOC-free, low odour and APEO-free paint additives as well as formaldehyde free<br />
preservatives. Our green preservative combined with our state-of-the-art manufacturing facility and an elaborate technical service offers the<br />
perfect combination of product and service that enables our customers achieve exacting solutions for a better tomorrow!
7<br />
Financial Performance<br />
PBT and Margin<br />
1800<br />
1631<br />
30<br />
1500<br />
25<br />
(Rs. Million)<br />
1200<br />
900<br />
600<br />
648<br />
508 493<br />
1073<br />
11.7<br />
17.7<br />
20<br />
15<br />
10<br />
(%)<br />
300<br />
7.6 7.4<br />
5.7<br />
5<br />
0<br />
April’05 -<br />
March’06<br />
April’06 -<br />
December’06<br />
FY 2007<br />
FY 2008 FY <strong>2009</strong><br />
0<br />
PBT Margin %<br />
Distribution of Revenue <strong>2009</strong><br />
(Rs. Million)<br />
PAT and Margin<br />
Taxes 550 (6%)<br />
Exceptional items<br />
245 (3%)<br />
Profit after tax<br />
1081 (12%)<br />
1200<br />
1000<br />
1081<br />
24<br />
20<br />
Other expenses<br />
1066 (11%)<br />
Depreciation /<br />
Impairment<br />
203 (2%)<br />
(Rs. Million)<br />
800<br />
600<br />
400<br />
200<br />
404<br />
329<br />
4.8 4.8<br />
318<br />
3.7<br />
675<br />
7.4<br />
11.7<br />
16<br />
12<br />
8<br />
4<br />
(%)<br />
Personnel cost<br />
616 (7%)<br />
Cost of material<br />
5452 (59%)<br />
0<br />
April’05 -<br />
March’06<br />
April’06 -<br />
December’06<br />
FY 2007<br />
FY 2008 FY <strong>2009</strong><br />
PAT Margin %<br />
0<br />
EPS, DPS and Payout<br />
45<br />
170.8<br />
40.6<br />
175<br />
36<br />
140<br />
(Rupees)<br />
27<br />
18<br />
9<br />
82.8<br />
15.2<br />
11.0<br />
16.4 *<br />
18.0 **<br />
11.9<br />
98.1<br />
10.0<br />
25.3<br />
87.8<br />
19.0<br />
72.1<br />
25.0<br />
105<br />
70<br />
35<br />
(%)<br />
0<br />
April’05 -<br />
March’06<br />
April’06 -<br />
December’06<br />
FY 2007 FY 2008<br />
FY <strong>2009</strong><br />
0<br />
EPS DPS Payout<br />
(Earning per share) (Dividend per share) (Including Dividend Tax)<br />
* <strong>Annual</strong>ised ** Including Golden Jubilee Dividend of Rs 10
8<br />
<strong>Clariant</strong> Chemicals (India) Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
Capital employed and ROCE<br />
Net Working Capital to Sales<br />
4200<br />
3500<br />
3880<br />
3165 3135<br />
3207<br />
3498<br />
48<br />
40<br />
1250<br />
1000<br />
1199<br />
1128<br />
1165<br />
1008<br />
20<br />
16<br />
(Rs. Million)<br />
2800<br />
2100<br />
1400<br />
21.0<br />
30.9<br />
32<br />
24<br />
16<br />
(%)<br />
(Rs. Million)<br />
750<br />
500<br />
14.1<br />
12.3*<br />
13.5<br />
11.0<br />
699<br />
7.6<br />
12<br />
8<br />
(%)<br />
700<br />
10.4<br />
13.8*<br />
10.1<br />
8<br />
250<br />
4<br />
0<br />
April’05 -<br />
March’06<br />
April’06 -<br />
December’06<br />
FY 2007<br />
FY 2008 FY <strong>2009</strong><br />
0<br />
0<br />
April’05 -<br />
March’06<br />
April’06 -<br />
December’06<br />
FY 2007<br />
FY 2008 FY <strong>2009</strong><br />
0<br />
Capital Employed<br />
ROCE<br />
NWC<br />
As % of Sales<br />
* <strong>Annual</strong>ised<br />
* <strong>Annual</strong>ised<br />
Inventory to Sales<br />
Receivable to Sales<br />
1500<br />
24<br />
1800<br />
24<br />
1250<br />
1253<br />
1282<br />
1127<br />
1054<br />
20<br />
1500<br />
1451<br />
1374<br />
1413<br />
1321<br />
1446<br />
20<br />
(Rs. Million)<br />
1000<br />
750<br />
14.8<br />
14.0 *<br />
13.1<br />
11.5<br />
767<br />
16<br />
12<br />
(%)<br />
(Rs. Million)<br />
1200<br />
900<br />
17.1<br />
15.0*<br />
16.4<br />
14.4<br />
15.7<br />
16<br />
12<br />
(%)<br />
500<br />
8.3<br />
8<br />
600<br />
8<br />
250<br />
4<br />
300<br />
4<br />
0<br />
April’05 -<br />
March’06<br />
April’06 -<br />
December’06<br />
FY 2007<br />
FY 2008 FY <strong>2009</strong><br />
0<br />
0<br />
April’05 -<br />
March’06<br />
April’06 -<br />
December’06<br />
FY 2007<br />
FY 2008 FY <strong>2009</strong><br />
0<br />
* <strong>Annual</strong>ised<br />
Inventory<br />
As % of Sales<br />
Receivable<br />
* <strong>Annual</strong>ised<br />
As % of Sales
9<br />
Notice<br />
NOTICE is hereby given that the Fifty-third <strong>Annual</strong> General<br />
Meeting of the Members of <strong>Clariant</strong> Chemicals (India) Limited<br />
will be held at Y. B. Chavan Auditorium, Gen. Jagannath Bhosale<br />
Marg, Next to Sachivalaya Gymkhana, Mumbai-400 021, on Friday,<br />
April 23, 2010 at 04.00 p.m. to transact the following business:<br />
Ordinary Business:<br />
1. To consider and adopt the audited Balance Sheet as at<br />
December 31, <strong>2009</strong> and the Profit and Loss Account for the<br />
year ended on that date and the <strong>Report</strong>s of the Directors and<br />
Auditors thereon.<br />
2. To confirm the declaration and payment of interim<br />
dividend and to declare a final dividend for the year ended<br />
December 31, <strong>2009</strong>.<br />
3. To appoint a director in place of Diwan A. Nanda, who<br />
retires by rotation and being eligible, offers himself for reappointment.<br />
4. To appoint the auditors and fix their remuneration.<br />
Special Business:<br />
5. To consider and, if thought fit, to pass, with or without<br />
modification, the following resolution as an Ordinary<br />
Resolution:<br />
"RESOLVED THAT in accordance with the provisions of Section<br />
257 of the Companies Act, 1956, Mr. Henri Schloemer, who<br />
was appointed as an Additional Director pursuant to the<br />
provisions of Section 260 of the Companies Act, 1956 and<br />
Article 113 of the Articles of Association of the Company with<br />
effect from January 1, 2010 and being eligible, offers himself<br />
for re-appointment and in respect of whom the Company has<br />
received notice in writing along with the prescribed deposit,<br />
from a shareholder signifying his intention to propose him<br />
as a candidate for the office of Director, be and is hereby<br />
appointed as a Director of the Company liable to retire by<br />
rotation.”<br />
6. To consider and if thought fit, to pass with or without<br />
modification, the following resolution as a Special<br />
Resolution:<br />
“RESOLVED THAT pursuant to the provisions of Sections 198,<br />
269, 309, 310 read with Schedule XIII and all other<br />
applicable provisions, if any, of the Companies Act, 1956,<br />
approval of members be and is hereby accorded to<br />
the appointment of Mr. Peter Palm as Vice-Chairman<br />
& Managing Director of the Company for a period of<br />
three years with effect from January 1, 2010 upon the<br />
terms and conditions including remuneration, benefits<br />
and perquisites payable or extended to him as set out<br />
in the agreement executed between the Company and<br />
Mr. Palm and provided in explanatory statement annexed to<br />
the Notice convening this meeting.<br />
RESOLVED FURTHER THAT Mr. Palm be paid a one time lump<br />
sum compensation not exceeding Rs. 10 lakhs subject to the<br />
deduction of tax, as relocation allowance and to reimburse<br />
actual expenses incurred for shifting of his personal effects<br />
from Leeds, UK to Mumbai, India.<br />
RESOLVED FURTHER THAT in the event of any statutory<br />
amendment, modification or relaxation by the Central<br />
Government to Schedule XIII to the Companies Act, 1956,<br />
the Board of Directors of the Company (hereinafter referred<br />
to as ‘the Board’ which term shall be deemed to include<br />
any Committee which the Board may constitute to exercise<br />
its powers, including powers conferred by this resolution)<br />
be and is hereby authorised to vary and/or increase the<br />
remuneration including salary, commission, perquisites,<br />
allowances, etc., within such prescribed limit(s) or ceiling<br />
and the agreement between the Company and the<br />
Vice-Chairman & Managing Director be suitably amended<br />
to give effect to such modification, relaxation or variation<br />
without any further reference to the members of the Company<br />
in General Meeting.<br />
RESOLVED FURTHER THAT, Mr. Palm shall not be subject<br />
to retirement by rotation as per Article 127 of the<br />
Articles of Association of the Company during his tenure as<br />
Vice-Chairman & Managing Director.<br />
RESOLVED FURTHER THAT for the purpose of giving effect<br />
to this resolution, any Director and the Company Secretary of<br />
the Company be and are hereby authorised to further execute<br />
the necessary documents under the Common Seal of the<br />
Company.<br />
7. To consider and, if thought fit, to pass, with or without<br />
modification, the following resolution as an Ordinary<br />
Resolution:<br />
“RESOLVED THAT pursuant to the provisions of Section<br />
293(1)(a) and other applicable provisions, if any, of the<br />
Companies Act, 1956, (including any statutory modifications<br />
or re-enactment thereof) and subject to the consent, approval,<br />
and permission being obtained from appropriate authorities to<br />
the extent applicable and necessary, consent of the Company<br />
be and is hereby accorded to the Board of Directors of the<br />
Company (hereinafter referred to as the ‘Board’ which shall
10 <strong>Clariant</strong> Chemicals (India) Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
be deemed to include any committee thereof) to sell, transfer<br />
and/or otherwise dispose off whole or substantially whole of<br />
the Company’s assets consisting of property/land/undertaking<br />
at the Balkum, Thane site of the Company with or without<br />
the buildings, plant and machinery, equipment, furniture and<br />
fixtures, infrastructure, facilities, auxiliaries, utilities attached<br />
thereto the land, intellectual property rights, resources,<br />
advantages, privileges, easement, benefits, exemptions,<br />
rights, lease, tenancy, licenses, consents etc. in respect of<br />
the said land and other assets attached or any part of it; to<br />
such person(s) or entities at a price and on such terms and<br />
conditions, as may be deemed fit by the Board in the best<br />
interest of the Company.<br />
RESOLVED FURTHER THAT the Board of Directors of the<br />
Company be and is hereby authorised and empowered<br />
to finalise and execute necessary documents including<br />
agreements, deeds of assignment/conveyance and other<br />
documents and to do all such other acts, deeds, matters and<br />
things as may be deemed necessary and expedient in their<br />
discretion for completion of transfer/sale/lease or otherwise<br />
dispose off the said property, land and undertaking and to<br />
give effect to this resolution.<br />
RESOLVED FURTHER THAT the Board of Directors be and is<br />
hereby authorized to delegate all or any of the powers herein<br />
conferred in such manner as may be deemed fit”.<br />
8. To consider and, if thought fit, to pass, with or without<br />
modification, the following resolution as a Special<br />
Resolution:<br />
“RESOLVED THAT pursuant to Section 146 (2) of the Companies<br />
Act, 1956 the registered office of the company be shifted<br />
from Ravindra Annexe, 194 Churchgate Reclamation,<br />
Mumbai-400 020 to Kolshet Road P.O. Sandoz Baug<br />
Thane 400 607 within the state of Maharashtra.<br />
RESOLVED FURTHER that for the purpose of giving effect to<br />
this resolution, the Board of Directors of the Company be and<br />
is hereby authorised to do all such acts, deeds, matters and<br />
things and to execute all such deeds, documents, instruments<br />
and writings and in its absolute discretion necessary or<br />
desirable or in the best interests of the Company.<br />
RESOLVED FURTHER that Mr. B. L. Gaggar, Director Finance &<br />
Company Secretary be authorized to notify the said change in<br />
the situation of the Registered Office of the Company to the<br />
Registrar of Companies, Maharashtra”.<br />
February 19, 2010.<br />
Registered Office:<br />
Ravindra Annexe,<br />
194, Churchgate Reclamation,<br />
Mumbai-400 020<br />
By Order of the Board of Directors<br />
For <strong>Clariant</strong> Chemicals (India) Limited<br />
B. L. Gaggar<br />
Director Finance & Company Secretary<br />
NOTES:<br />
1. A MEMBER ENTITLED TO ATTEND AND VOTE AT THE<br />
MEETING IS ENTITLED TO APPOINT A PROXY TO ATTEND<br />
AND VOTE INSTEAD OF HIMSELF AND THE PROXY NEED<br />
NOT BE A MEMBER OF THE COMPANY.<br />
Proxy form in order to be effective must be received at the<br />
registered office of the Company not less than 48 hours before<br />
the meeting.<br />
2. The relevant Explanatory Statement pursuant to Section 173<br />
of the Companies Act, 1956 in respect of the special business<br />
under Item Nos. 5 to 8 set out above is hereto annexed.<br />
3. The Register of Members and Share Transfer Books of the<br />
Company will remain closed from Tuesday, April 13, 2010 to<br />
Friday, April 23, 2010 both days inclusive, for the purpose of<br />
payment of final dividend, if declared at the <strong>Annual</strong> General<br />
Meeting.<br />
4. The final dividend on shares as recommended by the Board of<br />
Directors, if declared at the meeting, will be paid:<br />
(i) in respect of shares held in demat form on the basis<br />
of beneficial ownership as per details furnished by the<br />
Depositories as at the end of the business on April 12,<br />
2010 and<br />
(ii) in respect of shares held in physical form to those<br />
members whose names appear on the Register of<br />
Members of the Company after giving effect to all valid<br />
share transfers lodged with the Share Transfer Agent<br />
on or before April 12, 2010. The Company will dispatch<br />
the dividend warrants on or after April 24, 2010.<br />
5. Profiles of the Directors being re-appointed, as required under<br />
clause 49 of the Listing Agreement, are provided in the report<br />
on Compliance of Corporate Governance.<br />
6. The amount outstanding in unpaid dividend account in respect<br />
of financial year 2002-2003 will be transferred to the ‘Investor<br />
Education and Protection Fund’ maintained with the Central<br />
Government after the end of 7 (seven) years after July 23,<br />
2010. Members who have still not encashed their dividend<br />
are requested to encash the same at the earliest.<br />
7. In case of any change of particulars including address, bank<br />
mandate & nomination for shares held in demat form, should<br />
be notified only to the respective Depository Participants<br />
where the member has opened his demat account. The<br />
Company or its Share Transfer Agent will not be able to act<br />
on any direct request from these Members for change of<br />
such details. However, any change in particulars in respect of<br />
shares held in physical form, should be sent to the Registrars<br />
& Share Transfer Agents of the Company.<br />
8. Members holding shares in demat form may please note that<br />
the bank account details given by them to their Depository<br />
Participants (DPs) and passed on to the Company by such DPs<br />
would be printed on the dividend warrants of the concerned<br />
members. However, if any member(s) wants to receive<br />
dividend in any other bank account, he/she should change/<br />
correct the bank account details with their concerned DPs and<br />
also intimate about ECS payment requirement. The Company
Notice<br />
11<br />
will not be able to act on any such request from shareholders<br />
directly for deletion/change in the bank account details.<br />
9. Members may please note that the Dividend Warrants are<br />
payable at par at all the clearing branches of the HDFC<br />
Bank Limited in India for an initial period of three months<br />
only. Thereafter, the Dividend Warrant is payable only on<br />
revalidation for a further period of three months. The members<br />
are therefore, advised to encash Dividend Warrants within<br />
the initial validity period.<br />
10. Members who wish to attend the meeting are requested to<br />
bring attendance slip sent herewith, duly filled in, and the<br />
copy of the <strong>Annual</strong> <strong>Report</strong>. Copies of the <strong>Annual</strong> <strong>Report</strong> will<br />
not be distributed at the meeting.<br />
ANNEXURE TO THE NOTICE<br />
Explanatory Statement under Section 173 of the Companies<br />
Act, 1956<br />
Item No. 5<br />
At the meeting of the Board of Directors (“the Board”) of the Company<br />
held on October 29, <strong>2009</strong> the Board appointed Mr. Henri Schloemer<br />
as an additional director of the Company with effect from January<br />
1, 2010 pursuant to Section 260 of the Companies Act, 1956, read<br />
with Article 113 of the Articles of Association of the Company,<br />
Mr. Schloemer holds office only up to the date of the forthcoming<br />
<strong>Annual</strong> General Meeting.<br />
Notice in writing has been received from a member of the Company<br />
along with the prescribed deposit under Section 257 of the Companies<br />
Act, 1956, signifying his intention to propose Mr. Henri Schloemer as<br />
a candidate for the office of Director.<br />
The Directors recommend the Resolution for Member’s approval.<br />
No Director other than Mr. Henri Schloemer is concerned/interested<br />
in this resolution.<br />
Item No. 6<br />
Mr. Peter Palm was appointed by the Board, as the Vice-Chairman<br />
& Managing Director of the Company, for a period of three years,<br />
with effect from January 1, 2010 on the remuneration, terms and<br />
conditions subject to the approval of members.<br />
The Directors recommend the approval of the special resolution<br />
concerning the appointment of Mr. Palm. None of the Directors,<br />
other than Mr. Palm, is concerned or interested in the resolution.<br />
The information in respect of the terms of remuneration and<br />
perquisites is given below:<br />
Remuneration, benefits and perquisites<br />
i. Salary:<br />
Rs. 7,88,000/- (Rupees seven lakhs eighty eight thousands<br />
only) per month, which may be increased by the Board of<br />
Directors from time to time, subject to a maximum salary of<br />
Rs. 9,45,000/- (Rupees nine lakhs forty five thousands only)<br />
per month. Salary will be subject to the deduction of Income<br />
tax at the applicable rates, under the Income Tax Act, 1961.<br />
ii.<br />
iii.<br />
iv.<br />
Contribution to PF:<br />
Contribution to Provident Fund at the rate specified in the<br />
Provident Fund Act and Rules thereunder calculated on salary<br />
payable per month.<br />
Commission:<br />
Subject to the overall ceilings laid down under Sections<br />
198 and 309 of the Companies Act, 1956, a fixed sum in the<br />
range of Rs. 21,00,000/- (Rupees twenty-one lakhs only) to<br />
Rs. 30,00,000/- (Rupees thirty lakhs only) per annum, as may<br />
be decided by the Board from year to year.<br />
Perquisites<br />
a) Housing:<br />
Suitable residential accommodation, free of cost with<br />
all facilities, amenities and services (including gas,<br />
electricity, water and furnishings). In case Mr. Palm<br />
does not opt for Company provided accommodation<br />
at any time, he shall be reimbursed the house rent<br />
allowance of a sum not exceeding 70% of his salary.<br />
The expenditure incurred by the Company on gas,<br />
electricity, water and furnishings provided to him shall<br />
be evaluated as per the Income Tax Rules, 1962.<br />
b) Medical Reimbursement:<br />
Reimbursement of medical expenses incurred by<br />
Mr. Palm for self and family, in accordance with the<br />
rules and regulations of the Company as may be in<br />
force from time to time.<br />
c) Leave and Leave Travel Concession:<br />
Leave period of six weeks on full pay and allowances,<br />
for every twelve months of service subject to the<br />
condition that the accumulated leave shall not be<br />
encashed. The Company will bear the full cost of leave<br />
passage for Mr. Palm and his family once in a year to<br />
any destination in India. In case it is proposed that the<br />
leave be spent abroad, the Company will bear the full<br />
cost of air passage by club class for Mr. Palm and his<br />
family once in a year not exceeding the cost of return<br />
passage to his home country.<br />
d) Club Fees:<br />
Mr. Palm shall be entitled to the reimbursement of<br />
fees of any two clubs in India, including admission or<br />
entrance fees and monthly or annual subscriptions.<br />
e) Personal Accident Insurance:<br />
The Company shall pay an annual premium of a sum<br />
not exceeding Rs.15,000/- towards personal accident<br />
insurance policy of Mr. Palm.<br />
f) Reimbursement of expenses for returning to home<br />
country:<br />
Mr. Palm will be entitled to reimbursement of expenses<br />
incurred by him for self and family for returning to his<br />
home country after completion of his tenure of office<br />
including actual expenses incurred on travel and on
12 <strong>Clariant</strong> Chemicals (India) Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
packing, forwarding, loading/unloading as well as<br />
freight, insurance etc. in connection with the moving<br />
of his personal effects.<br />
g) Car, Driver & Telephone:<br />
The Company will provide Mr. Palm a car and driver<br />
and telephone at his residence for use on Company’s<br />
business. Use of car for private purposes and personal<br />
long distance calls on telephone shall be billed by the<br />
Company to Mr. Palm.<br />
In case the Company is not able to provide a driver to<br />
Mr. Palm, the expenses for engaging a driver will be<br />
reimbursed to him as per the Company’s rules.<br />
h) Entertainment Expenses:<br />
The Company shall reimburse entertainment expenses<br />
actually and properly incurred by Mr. Palm in the course<br />
of the business of the Company subject to such annual<br />
limits as may be fixed by the Board of Directors of the<br />
Company.<br />
v) Limits on Remuneration:<br />
The remuneration as specified in clauses above shall be<br />
subject to the overall limits as specified under Sections 198,<br />
269, 309 and other applicable provisions read with Schedule<br />
XIII of the Companies Act, 1956.<br />
vi)<br />
vii)<br />
Minimum Remuneration:<br />
In the event of the Company incurring a loss or having<br />
inadequate profits in any financial year, the remuneration,<br />
benefits and perquisites payable or extended to Mr. Palm<br />
shall be in accordance with the provisions of Section II of<br />
Part II of Schedule XIII to the Companies Act, 1956 as amended<br />
from time to time.<br />
Termination:<br />
This agreement may be terminated by either party by giving to<br />
the other party six months’ notice of such termination.<br />
viii) Vacation of Office:<br />
If at any time during the tenure of his appointment as the<br />
Vice-Chairman & Managing Director, Mr. Palm ceases to<br />
be in the whole time employment of the Company for any<br />
reason whatsoever, he shall also cease to be a Director of<br />
the Company and simultaneously this agreement shall stand<br />
terminated.<br />
ix)<br />
Sitting Fees:<br />
Mr. Palm shall not be paid sitting fees for attending the<br />
meetings of the Board of Directors of the Company.<br />
Mr. Palm is not liable to retire by rotation during his tenure as<br />
Vice-Chairman and Managing Director.<br />
Item No. 7<br />
Sale of Land/Premises at Balkum<br />
In terms of Section 293(1) (a) of the Companies Act, 1956 sale, lease<br />
or otherwise disposal of the whole, or substantially the whole of<br />
undertaking of the Company, or where the Company owns more<br />
than one undertaking, of the whole or substantially the whole of<br />
any such undertaking requires approval of the shareholders by way<br />
of an Ordinary Resolution.<br />
The Company is holding about 36 acres of land at Balkum, Thane<br />
and after completion of sale of Diketene and Intermediates<br />
business together with its movable assets in terms of Business<br />
Transfer Agreement, in January 2010, the site is currently used for<br />
manufacturing operations of Phthalo Green pigments and various<br />
site offices and laboratory set-up. The location earlier approved<br />
for use by chemical industry by the Govt. of Maharashtra, is<br />
currently surrounded by residential buildings. It is, therefore felt<br />
that considering the Company’s commitment to environment,<br />
safety and health of its people and society at large, the site is<br />
not fit for continuing the operations as chemical factory and the<br />
potential of the premises/land at site can be better realised for<br />
use by other commercial/residential purposes. Since development<br />
of infrastructure is not the core of the Company’s business, the<br />
Board considered and thought it fit and proper that after closure,<br />
divestment or sale of its existing business operations from Balkum<br />
site and subject to approval of shareholders, the premises/land and<br />
other assets attached thereto, may be sold in the best interest of the<br />
Company and the value realised therefrom may be best put to use<br />
for expansion/growth of the Company’s business.<br />
The Directors recommend the Resolution for Member’s approval.<br />
None of the Director is concerned/interested in this resolution.<br />
Item No. 8<br />
Proposal for change of registered office<br />
As per provisions of Section 146(2) of the Companies Act, 1956 read<br />
with proviso (b) thereto, shifting of registered office of a company<br />
outside the local limits of any city or town requires approval of<br />
shareholders by way of Special Resolution.<br />
With a view to improve co-ordination and communication between<br />
the corporate, marketing and site offices, the Board of Directors<br />
considered and subject to approval of shareholders, approved the<br />
proposal for shifting the registered office to Kolshet in Thane, where<br />
the manufacturing site, marketing offices and the technology labs of<br />
the Company are currently located. The proposed location is outside<br />
the local limits of Mumbai city and therefore requires approval<br />
of shareholders by way of special resolution. If approved, the<br />
registered office will be moved to Kolshet Road, P. O. Sandoz Baug,<br />
Thane 400 607 with effect from May 1, 2010.<br />
The Directors recommend the approval of the special resolution.<br />
None of the Directors is concerned or interested in the resolution.<br />
February 19, 2010.<br />
Registered Office:<br />
Ravindra Annexe,<br />
194, Churchgate Reclamation,<br />
Mumbai-400 020<br />
By Order of the Board of Directors<br />
For <strong>Clariant</strong> Chemicals (India) Limited<br />
B. L. Gaggar<br />
Director Finance & Company Secretary
13<br />
Directors’ <strong>Report</strong><br />
Your directors are pleased to present the Fifty-third annual report<br />
and audited statement of accounts for the year ended December<br />
31, <strong>2009</strong>.<br />
Financial Results<br />
The financial performance of the Company for the year ended<br />
December 31, <strong>2009</strong> is summarized below:<br />
Rupees - Lakhs<br />
<strong>2009</strong> 2008<br />
Sales (Gross) 97322.24 100145.34<br />
Less: Excise duty (5188.11) (8505.87)<br />
Net sales 92134.13 91639.47<br />
Profit before exceptional items & taxation 18761.13 10776.60<br />
Less: Exceptional items (2450.46) (48.00)<br />
Profit before taxation 16310.67 10728.60<br />
Less: Provision for taxation (incl. FBT and deferred tax) (5466.34) (3732.21)<br />
Less: Short provision for taxation – Prior years (30.77) (248.09)<br />
Profit after tax 10813.56 6748.30<br />
Add: Balance brought forward from previous year 1097.40 950.36<br />
Amount available for appropriation 11910.96 7698.66<br />
Appropriations :<br />
General reserve 1081.36 674.83<br />
Interim dividend 2666.07 —<br />
Proposed final dividend 3999.11 5065.54<br />
Corporate tax on dividend (interim & final proposed) 1132.75 860.89<br />
Balance carried forward to balance sheet 3031.67 1097.40<br />
Review of Operations<br />
The global economic and financial crisis that began in 2008 and<br />
continued to affect Indian economy till first half of <strong>2009</strong> had a<br />
crippling impact on the global chemical industry. This has affected the<br />
Company’s performance during the first 2 quarters of <strong>2009</strong>. However,<br />
unexpected recovery in domestic market and excellent performance<br />
in terms of cost management has resulted into positive growth<br />
in terms of sales and benchmarking performance in net profits of<br />
your Company as compared to previous year. The following ratios<br />
appropriately reflect your Company’s operational performance during<br />
the year under review.<br />
<strong>2009</strong> 2008<br />
Sales growth (%) 0.5 6.4<br />
Domestic sales growth (%) 2.8 7.0<br />
Export sales growth (%) (8.3) 4.0<br />
PBDIT (% to sales) 22.6 14.9<br />
PAT (% to sales) 11.7 7.4<br />
ROCE (%) 30.9 21.0<br />
Debt : Equity ratio 0.01 0.01<br />
Earning per share (Rs.) 40.56 25.31<br />
Cash earning per share (Rs.) 48.19 36.49<br />
Book value per share (Rs.) 130.45 119.14<br />
Dividend<br />
During the year, your directors had declared interim dividend of<br />
Rs. 10 per share (100%) and the same was paid in August, <strong>2009</strong>.<br />
Considering the excellent performance for the year and the policy for<br />
distribution of profits to the shareholders adopted by the Company,<br />
the Board of Directors is pleased to recommend a final dividend of<br />
Rs. 15 per share (150%).<br />
The total dividend for the year ended amounts to Rs. 25 per share<br />
(250%) as compared to Rs. 19 per share (190%) paid for the previous<br />
year. On the paid-up share capital of Rs. 2666 lakhs, the total payout<br />
on account of dividend and tax thereon for the year entails cash out<br />
flow of Rs. 7798 lakhs (previous year Rs. 5926 lakhs) and pay out<br />
of 72% of the net profit.<br />
Divestment of Business<br />
The Company, during the year sold its flexible laminating<br />
adhesive business for a total consideration of Rs. 3.6 crores to<br />
M/s. Bostik India Pvt. Ltd. The Company had also signed business<br />
transfer agreement (BTA) with M/s. Laxmi Organic Industries Ltd.<br />
for sale of its diketene and intermediates business located at<br />
Balkum, Thane together with movable assets, technical knowhow<br />
and non-compete undertaking for a total consideration of<br />
Rs. 13.25 crores. On receipt of full consideration, the transaction is<br />
concluded in January 2010 and the plant is being dismantled and<br />
delivered to the buyer.<br />
Registered Office<br />
The registered office of the Company presently located at<br />
Ravindra Annexe, 194, Churchgate Reclamation, Mumbai-400 020<br />
is under lease and the premises is under major repairs. For better<br />
co-ordination and effective communication between sites, offices<br />
and laboratories, the Board has decided that subject to approval of<br />
shareholders, the registered office of the Company be relocated at<br />
<strong>Clariant</strong> owned premises at Kolshet Road, Thane-400 607 effective<br />
from May 1, 2010. Shareholders are requested to approve the<br />
proposal.<br />
Balkum, Thane site<br />
The Board of Directors of your Company has decided that subject to<br />
the decision on closure, divestment or sale of its existing business<br />
operations carried out at Balkum, Thane site and subject to approval<br />
of shareholders, the land/premises and other assets attached<br />
thereto, may be sold in the best interest of the Company and the<br />
value realised therefrom may be best put to use for growth of the<br />
Company’s business.<br />
Shareholders are requested to consider and approve the proposal as<br />
set out in notice of the annual general meeting.
14 <strong>Clariant</strong> Chemicals (India) Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
Fixed Deposits<br />
The Company has not accepted fixed deposits during the year<br />
under review. There were no overdue deposits except unclaimed<br />
deposits of Rs. 6000/- as at December 31, <strong>2009</strong> which has been<br />
subsequently deposited to Investor Education & Protection Fund<br />
of Government in January, 2010. As per requirements of Section<br />
205C of the Companies Act, 1956, the fixed deposits and interest<br />
unclaimed after completion of seven years are transferred to<br />
the Investor Education and Protection Fund established by the<br />
Central Government. There is no amount due and outstanding<br />
to be credited to Investor Education and Protection Fund as on<br />
December 31, <strong>2009</strong>.<br />
Subsidiary Company<br />
The audited accounts of the wholly owned subsidiary, Chemtreat<br />
Composites India Private Limited along with Auditors <strong>Report</strong> thereon,<br />
and the statement pursuant to Section 212 of the Companies Act,<br />
1956, is a part of this annual report.<br />
Consolidated Financial Statements<br />
In accordance with the Accounting Standards (AS-21), notified<br />
by the Companies (Accounting Standards) Rules, 2006, the<br />
consolidated financial statements covered in this annual report<br />
by the Company include financial information of its subsidiary<br />
Chemtreat Composites India Private Limited and forms part of this<br />
annual report.<br />
Management Discussion and Analysis <strong>Report</strong><br />
The Management Discussion and Analysis <strong>Report</strong> forming part of<br />
Directors’ <strong>Report</strong> for the year under review, as stipulated under<br />
Clause 49 of the listing agreement with stock exchanges, forms part<br />
of the annual report.<br />
Corporate Governance<br />
The Company is committed to maintain the highest standards<br />
of corporate governance. The report on corporate governance as<br />
stipulated under clause 49 of the listing agreement forms part of<br />
the annual report. The requisite certificate from the auditors of the<br />
Company confirming compliance with the conditions of corporate<br />
governance as stipulated under the aforesaid clause is attached to<br />
this report.<br />
Particulars of Employees<br />
The statement giving particulars of employees, as required<br />
under Section 217(2A) of the Companies Act, 1956 read with the<br />
Companies (Particulars of Employees) Rules, 1975 as amended,<br />
forms part of this report. However, having regard to the provisions<br />
of Section 219(1)(b)(iv) of the said Act, the annual report excluding<br />
the aforesaid statement is being sent to all the members of the<br />
company. Any member interested in obtaining a copy of this<br />
statement may write to the company secretary at the registered<br />
office of the Company.<br />
Directors<br />
Consequent upon termination of agreement of Mr. Heiner Meier, as<br />
Vice-Chairman and Managing Director, the Board at its meeting held<br />
on October 29, <strong>2009</strong> considered and appointed Mr. Peter Palm as<br />
Vice-Chairman and Managing Director of the Company effective from<br />
January 1, 2010. The Board wishes to place on records its sincere<br />
appreciation for Mr. Meier’s valuable contribution since integration<br />
of <strong>Clariant</strong> group companies in India and welcomes the appointment<br />
of Mr. Palm in his place. Mr. Peter Lindner, who was first appointed<br />
as director of the Company on October 25, 2001 and Mr. Walter<br />
Kindler, who was appointed as director on February 20, <strong>2009</strong> to fill<br />
up the casual vacancy caused by resignation of Mr. Dominik Strebel<br />
resigned from the Board with effect from January 1, 2010.The Board<br />
at the meeting held on October 29, <strong>2009</strong> appointed Mr. Heiner Meier<br />
as director to fill up the casual vacancy caused by resignation of<br />
Mr. Lindner and Mr. Henri Schloemer as additional director with<br />
effect from January 1, 2010. The Company has received notice<br />
under Section 257 of the Companies Act, 1956 from a shareholder<br />
proposing Mr. Henri Schloemer as a director of the Company.<br />
In accordance with the provisions of the Companies Act, 1956 and<br />
the articles of association of the Company, Diwan Arun Nanda, the<br />
director of the Company is due to retire at the forthcoming annual<br />
general meeting, and being eligible, has offered himself for reappointment.<br />
Details of the directors seeking re-appointment are provided<br />
in the Corporate Governance <strong>Report</strong> forming part of this report, as<br />
required under Clause 49 of the listing agreement with the stock<br />
exchanges.<br />
Directors’ Responsibility Statement<br />
In terms of Section 217(2AA) of the Companies Act, 1956 your<br />
directors confirm that:<br />
(a) in the preparation of the annual accounts, the applicable<br />
accounting standards have been followed;<br />
(b)<br />
(c)<br />
(d)<br />
they have selected such accounting policies and applied them<br />
consistently and made judgements and estimates that are<br />
reasonable and prudent so as to give a true and fair view of<br />
the state of affairs of the Company as at December 31, <strong>2009</strong><br />
and of the profit of the Company for that year;<br />
they have taken proper and sufficient care for the maintenance<br />
of adequate accounting records in accordance with the<br />
provisions of the Companies Act, 1956 for safeguarding the<br />
assets of the Company and for preventing and detecting fraud<br />
and other irregularities;<br />
they have prepared the annual accounts on a going concern<br />
basis.<br />
Conservation of Energy, Research and Development,<br />
Technology Absorption, Foreign Exchange Earnings and<br />
Outgo<br />
Information required under section 217(1)(e) of the Companies Act,<br />
1956 read with the Companies (Disclosure of Particulars in the<br />
<strong>Report</strong> of Board of Directors) Rules, 1988 is annexed hereto and<br />
forms part of the report.
Directors’ <strong>Report</strong><br />
15<br />
Auditors<br />
M/s. Deloitte Haskins & Sells, Chartered Accountants, retires at the<br />
conclusion of the ensuing annual general meeting and being eligible,<br />
offer themselves for re-appointment. Members are requested to<br />
appoint the auditors and fix the remuneration payable to them.<br />
Cost Audit<br />
The Board of Directors, in pursuance of an order under section 233B<br />
of the Companies Act, 1956 issued by the Central Government, has<br />
appointed M/s. R. Nanabhoy & Co., Cost Accountants, Mumbai, as<br />
cost auditors to audit the cost accounts maintained by the Company<br />
in respect of Dyes and Intermediates for bulk drugs for the financial<br />
year <strong>2009</strong>.<br />
Acknowledgement<br />
The Board of Directors place on record its sincere appreciation for<br />
the dedicated efforts put in by all employees, their commitment and<br />
contribution ensuring sustained operations that your Company has<br />
achieved in most difficult and challenging environment during the<br />
year. Your directors would like to record their sincere appreciation<br />
for the support and co-operation that your Company received from<br />
all the distributors, suppliers and business associates whom your<br />
Company regards as partners in progress.<br />
The Board of directors also express their appreciation of the<br />
assistance and co-operation extended by the bankers and unstinted<br />
support received from <strong>Clariant</strong> group companies.<br />
Your directors thank the members for their confidence in the<br />
Company.<br />
Mumbai, February 19, 2010<br />
For and on behalf of the Board of Directors<br />
R. A. Shah<br />
Chairman<br />
Annexure to<br />
Directors’ <strong>Report</strong><br />
Information as per section 217(1)(e) read with Companies (Disclosure<br />
of Particulars in the <strong>Report</strong> of Board of Directors) Rules, 1988<br />
and forming part of the Directors' report for the year ended<br />
December 31, <strong>2009</strong>.<br />
FORM-A<br />
Particulars with respect to conservation of energy<br />
A. Power and fuel consumption:<br />
1. Electricity:<br />
a) Purchased:<br />
<strong>2009</strong> 2008<br />
Units (in ‘000 KwH) 49592 51119<br />
Total amount (Rs. Lakhs) 2605 2316<br />
Rate per Unit (Rs.) 5.25 4.53<br />
b) Own Generation:<br />
2. Coal<br />
i) Through diesel generator<br />
Units (in ‘000 KwH) 1650 1138<br />
Units per Litre of diesel oil 3.28 3.19<br />
Cost per Unit (Rs.) 10.58 11.56<br />
ii) Through Steam turbine/ generator Nil Nil<br />
Quantity (MT) 6178 3825<br />
Total cost (Rs. Lakhs) 365 250<br />
Average rate (Rs. per Kg.) 5.90 6.54<br />
3. Furnace Oil (including L.S.H.S.)<br />
Quantity (MT) 3712 2549<br />
Total Cost (Rs. Lakhs) 755 698<br />
Average rate (Rs. per Kg.) 20.40 27.38<br />
4. Other internal generation Nil Nil<br />
5. Agro mass briquettes<br />
Quantity (MT) 8200 14475<br />
Total cost (Rs. Lakhs) 334 537<br />
Average rate (Rs. per Kg.) 4.08 3.71<br />
6. Lignite / Fire wood<br />
Quantity (MT) 2190 3083<br />
Total cost (Rs. Lakhs) 35 48<br />
Average rate (Rs. per Kg.) 1.58 1.54<br />
B. Consumption per unit of production:<br />
The Company manufactures a wide variety of products. The<br />
products before reaching the finished final stage pass through<br />
various operations in the different plants. It is, therefore, not<br />
feasible to furnish the information in respect of consumption<br />
per unit of production.
16 <strong>Clariant</strong> Chemicals (India) Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
FORM-B<br />
Form of disclosure of particulars with respect to Technology<br />
Absorption, Research & Development (R & D).<br />
Research & Development<br />
1. Specific Areas in which R&D carried out by the<br />
Company:<br />
R&D focused on two major aspects i.e. improved products and<br />
cost reduction. In the competitive market of specialty chemicals<br />
and colorants it is very much necessary to develop products<br />
with better application properties and ease of application.<br />
Improved product safety of products, especially for exports,<br />
was another important area in which R & D worked. With the<br />
increasing cost of raw materials, fuel and energies R & D’s<br />
efforts were directed towards optimization of the processes<br />
and operations of pigments, dyes, intermediates, surfactants<br />
and other specialty chemicals from cost reduction point of<br />
view.<br />
2. Benefits derived as a result of the above R & D:<br />
The new as well as improved products created additional<br />
business and also helped to achieve customers’ satisfaction.<br />
Process optimization lead to substantial cost reduction.<br />
Development of eco-friendly processes resulted in lower<br />
quantity of effluent and emission. Introduction of non toxic/non<br />
hazardous products conforming to product safety regulations<br />
resulted in higher and sustainable exports.<br />
3. Future plan of action:<br />
R & D will continue focus on projects leading to further cost<br />
reduction, improved product safety and ecology.<br />
4. Expenditure on R & D:<br />
2. Benefits derived as a result of the above efforts, e.g. product<br />
improvement, cost reduction, product development, import<br />
substitution etc.<br />
Benefits derived from these efforts include process<br />
rationalization, product quality improvement, import<br />
substitution and overall cost reduction.<br />
3. In case of imported technology (imported during the last<br />
5 years reckoned from the beginning of the financial year),<br />
following information may be furnished.<br />
(a) Technology imported : Nil<br />
(b) Year of import : N.A.<br />
(c) Has technology been fully absorbed : N.A.<br />
Foreign Exchange Earnings and Outgo<br />
<strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
1. Total foreign exchange earned 18064.41 19734.02<br />
2. Total foreign exchange used 23689.50 22923.72<br />
Mumbai, February 19, 2010<br />
For and on behalf of the Board of Directors<br />
R. A. Shah<br />
Chairman<br />
<strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
(a) Capital 3.36 9.93<br />
(b) Revenue 224.20 323.29<br />
(c) Total 227.56 333.22<br />
(d)<br />
Total R & D Expenditure as<br />
percentage of total turnover 0.25% 0.36 %<br />
Technology absorption, adaptation and innovation:<br />
1. Efforts, in brief, made towards technology absorption,<br />
adaptation and innovation:<br />
The R & D department absorbs the knowledge of chemical<br />
technology from various sources such as know-how from<br />
the parent company and its worldwide affiliates, our own<br />
experimental data bank, published literature etc. and<br />
thereafter adapts the same to the Company's infrastructure.<br />
While adapting technology care has to be taken that it suits<br />
the locally available raw materials and production plants. Also<br />
it is to be ensured that the raw material specifications are not<br />
‘over demanding’ and the raw material cost is affordable. The<br />
new/improved technology is used to effect improvements to<br />
the products and processes as well as for the containment of<br />
pollution.
17<br />
Management Discussion & Analysis<br />
Financial and Operational Performance<br />
The year <strong>2009</strong> began with a very high degree of uncertainty<br />
and volatility in the Indian as well as the global economy. The<br />
sentiments, however, started improving in the later part of the<br />
year with pick up in domestic demand. Despite all the challenges,<br />
recession and downturns in the business all around the world,<br />
your Company was able to sustain its business performance and<br />
registered positive growth in sales and exceptional improvement in<br />
net results. While domestic sales grew by 2.8%, export sales were<br />
lower by 8.3%. Of the total sales revenue of the Company for the<br />
year, 18.6% is contributed by exports. Efficient cost management at<br />
all levels resulted in an impressive growth of 51.5% in profit before<br />
depreciation, interest, exceptional items and tax (PBDIT) and 60.2% in<br />
net profit after tax (PAT) over the previous year. The overall efficiency<br />
has resulted into improvement in PBDIT from 15% to 22.6% and<br />
PAT from 7.4% to 11.7% of sales as compared to the previous year.<br />
These results in the tough macroeconomic environment reflect the<br />
strength of the Company in the market place.<br />
The Company has further consolidated its market leadership in the<br />
highly competitive textile chemicals and leather dyes sectors. It is<br />
constantly improving its market presence in other industry segments<br />
it participates in.<br />
The Company remains a zero debt company with no long-term<br />
borrowings. Short-term borrowings are restricted to the need<br />
based working capital requirements. The Company has created a<br />
benchmark in efficient management of working capital. The year end<br />
ratio of inventory to sales of 8.3%, receivables to sales of 15.7%<br />
and net working capital (NWC) to sales of 7.6% is one of the best<br />
in the specialty chemical industry. Net cash flow from operating<br />
activities during the year was Rs. 17108 lakhs. Funds surplus to the<br />
operational needs have been prudently invested to earn reasonable<br />
returns with a high degree of safety. A sum of Rs. 12125 lakhs<br />
(previous year Rs. 5459 lakhs) stands invested in debt schemes of<br />
mutual funds at the end of the year.<br />
During the year under review, all the plants had smooth operations<br />
and the capacity utilisation was on need-based requirement. The<br />
Company sold its non-core business of flexible laminating adhesives<br />
and entered into a business transfer agreement for sale of its<br />
diketene and intermediate business. Both these businesses during<br />
the year contributed Rs. 8568 lakhs by way of net sales.<br />
Achievement of ISO 9001, ISO 14001 and OHSAS–ISO 18001<br />
certification from SQS (Swiss Association for Quality Management<br />
System) for the Company’s Management Systems and for Environment<br />
Management and Safety in its operations reflects yours Company’s<br />
continuous commitment towards quality, safety and sustainable<br />
environment friendly approach.<br />
Business Segments and Performance<br />
In accordance with the Accounting Standard – 17 notified by the<br />
Companies (Accounting Standards) Rules, 2006, the Company has<br />
reclassified its range of products into two reportable business<br />
segments based on characteristics of products, production processes<br />
and the class of customers.<br />
1. Intermediates and Colours:<br />
The intermediates and colours segment comprises of<br />
pigments, pigment preparations, additives, intermediates and<br />
masterbatches.<br />
<strong>Clariant</strong> offers a wide range of products for optimal colour<br />
and performance solutions. High performance pigments serve<br />
a variety of industries including the automotive, architectural,<br />
cosmetics, packaging and printing trades and the product<br />
portfolio includes pigment preparations, special dyes, flame<br />
retardants, high quality waxes and polymer additives.<br />
The pigments and additives businesses of the Company<br />
deal in pigments, their dispersions and diketene derivatives.<br />
They have a strong presence in organic pigments serving<br />
the needs of the paints, printing-inks, plastics, rubber,<br />
detergents, cosmetics and other industries. Besides being an<br />
important player in diketene chemistry, it has niche products<br />
in the colourant range to meet specific customer needs. The<br />
Company’s manufacturing facilities and state of art technical<br />
service laboratories provide cutting edge technology which<br />
helps in realizing the goals set by <strong>Clariant</strong>, for sustainable<br />
growth of the business. The Company is focusing on the<br />
promotion of lead- and chrome-free pigments and is spreading<br />
the awareness on use of non-halogenated flame retardants.<br />
The pigment and additives businesses of the company, during<br />
the year, had good domestic growth of 6%, however negative<br />
growth of 20% in exports resulted into net growth of -3%<br />
over the previous year.<br />
The <strong>Clariant</strong>’s masterbatches business is a world leader in<br />
providing colour and additive concentrates and performance<br />
solutions for the plastic industry and holds strong positions<br />
in the packaging, consumer goods, automotive and fiber<br />
segments.<br />
The masterbatches business of the Company services the<br />
plastic processing industry covering the product range of colour<br />
concentrates, additive masterbatches and special mixtures of<br />
pigments, additives, dispersing and wetting agents which<br />
have applications in a variety of industrial and consumer<br />
products such as automotive, packaging of pharmaceuticals,<br />
personal care, food & beverage products, packaging<br />
film & sheet, agriculture appliances, electrical connectors,
18 <strong>Clariant</strong> Chemicals (India) Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
wire & cables, medical equipment, household and consumer<br />
products, food services, toys, fibers & filaments, compound<br />
/ MRP and construction etc. <strong>Clariant</strong> is recognized as an<br />
important supplier of specialty and tailor made masterbatches<br />
for the processing of polymers like LDPE, HDPE, HM-HDPE,<br />
PP, PVC, Nylon, PET, PBT and monofilaments, multi-filaments,<br />
staple and nonwoven fibers for technical textile applications.<br />
The masterbatches business, during the year, had an excellent<br />
growth of 36% over the previous year. In order to cater to the<br />
market potential of it’s product range, the Company is in the<br />
process of expanding the capacities and setting up a green<br />
field manufacturing facility in MIDC, Ambernath.<br />
The total sales under this segment of Rs. 39267 lakhs<br />
for the year comprises of pigments and additives of<br />
Rs. 32866 lakhs, masterbatches of Rs. 5318 lakhs and<br />
functional intermediates Rs. 1083 lakhs. The ratio of domestic<br />
sales to export sales was 73:27. The segment contributes<br />
43% to the total sales and registered a negative growth of<br />
2.2% over previous year.<br />
2. Dyes and Specialty Chemicals:<br />
The Segment comprises of specialty chemicals and dyes<br />
for the textile, leather and paper industry and performance<br />
chemicals for personal care and industrial applications.<br />
<strong>Clariant</strong>’s textile, leather and paper chemicals businesses<br />
add value through functionality and aesthetics to the textile,<br />
leather and paper industries and provide solutions to meet<br />
customers’ needs across the entire production chain in the<br />
user industry.<br />
The Textile business serves textile producers as well as<br />
retailers and brand owners with products and services for<br />
pre-treatment, sizing, fibre finishing, dyeing and printing to<br />
finishing. <strong>Clariant</strong>’s expertise in dyes and specialty chemicals<br />
makes the Company a perfect partner in every step of the<br />
textile process chain from fiber to finish. <strong>Clariant</strong>’s global<br />
service Archroma® provides a solution to manage colour<br />
standards along the whole textile chain and significantly<br />
accelerates time to market. The Company is the market leader<br />
in the segment of textile chemicals.<br />
The Leather business develops and serves the market needs of<br />
dyes and chemicals to process, treat and colour leathers and to<br />
create specific effects and fulfil the performance requirements<br />
of specific leather products. Market leadership in India in the<br />
leather business is fortified with a comprehensive range of<br />
dyes and wet end chemicals that cater to the retanning,<br />
dyeing and finishing of all types of leather.<br />
<strong>Clariant</strong> is the market leader in colourants and optical<br />
brighteners for paper and it’s specialty chemicals provide<br />
solutions, e.g. improve the strength of recycled paper. The<br />
Company has established itself as one of the preferred<br />
suppliers of dyes, optical brightening agents, surface and<br />
process chemicals for the domestic paper industry.<br />
During the year, the businesses of textile, leather and paper<br />
had overall growth of 5% driven mainly by export growth of<br />
100% over the previous year.<br />
<strong>Clariant</strong>’s product portfolio based on surfactants, polymers<br />
and active ingredients provide products and solutions for the<br />
oil and gas industry and key ingredients for the home care and<br />
cosmetic sector. A wide variety of global industries, such as<br />
detergent, cosmetics, oil, gas, construction, agriculture, metal<br />
working, mining, paint and aviation sectors use high-tech<br />
functional chemicals in their products. <strong>Clariant</strong> is a dominant<br />
player in the lubricant segment supplying brake fluids, engine<br />
coolants and specialty additives and is a preferred supplier<br />
of specialty ingredients for skin and hair care, wet wipes and<br />
selected pharmaceutical applications in the personal care<br />
segment. The Company is a leading supplier of biocides to the<br />
coating and construction industries and a solution provider for<br />
solvent recovery systems.<br />
Given the product range, the strong brand image created by<br />
the parent company coupled with capabilities of providing<br />
technical services in product development and application<br />
process, the Company is well positioned in this business<br />
segment.<br />
The total sales under this segment of Rs. 52867 lakhs for<br />
the year comprises of Rs. 46352 lakhs (87.7%) from domestic<br />
and Rs. 6515 lakhs (12.3%) from export sales. The Dyes and<br />
Specialty Chemicals segment has contributed 57% of total<br />
sales revenue for the year registering a growth of 2.7% over<br />
previous year.<br />
The segment wise financial performance of the Company is<br />
summarised below:<br />
(Rs. Lakhs)<br />
Segments <strong>2009</strong><br />
% to Total<br />
Sales 2008<br />
% to Total<br />
Sales<br />
Intermediates & Colours 39267 43% 40169 44%<br />
Dyes & Specialty Chemicals 52867 57% 51470 56%<br />
Total 92134 100% 91639 100%<br />
Internal Control Systems<br />
The Company has a comprehensive system of internal controls to<br />
safeguard the Company’s assets against loss from unauthorized use<br />
and ensure proper authorization of financial transactions. The system<br />
is designed to provide a high degree of assurance regarding the<br />
effectiveness and efficiency of operations, the reliability of financial<br />
controls and compliance with applicable laws and regulations. The<br />
organization is well structured and the policy guidelines are well<br />
documented with pre-defined authority where monetary decision is<br />
involved. Structured management information and reporting systems<br />
together with an exhaustive budgetary control process for all major<br />
operational activities form part of the overall control mechanism<br />
to ensure that requisite information related to all operations are<br />
reported and are available for control and review.<br />
The Company has established a well laid out policy to maintain<br />
the highest standards of environment, safety and health while<br />
maintaining operational integrity. This policy is strictly adhered to<br />
as per <strong>Clariant</strong> guidelines at all manufacturing sites.
Management Discussion & Analysis<br />
19<br />
The Company, with a view to encourage independent approach, has<br />
outsourced the function of internal auditors to qualified professionals,<br />
who conduct operational and system audits in accordance with an<br />
audit plan adopted by the audit committee. Internal auditors as<br />
part of their assignment, evaluate and assess the adequacy and<br />
effectiveness of internal control measures and the compliance with<br />
policies, plans and statutory requirements. The internal audit reports<br />
are reviewed at audit committee meetings and appropriate action on<br />
the recommendations is initiated by the management.<br />
Human Resources<br />
Human resources continue to be an invaluable and intangible asset<br />
and key success factor for the Company to grow and sustain it’s<br />
market position in a highly competitive and challenging environment.<br />
<strong>Clariant</strong> firmly believes that people are the pivotal force behind<br />
the growth and excellence in business operations. The overall<br />
performance and the market position, the Company enjoys are the<br />
result of the aggregate strength of it’s people.<br />
The Company during the year, paid special attention to developmental<br />
activities comprising of sharpening of skills and abilities, developing<br />
academic and professional knowledge and cultivating appropriate<br />
behavioral skill sets, such as improving interpersonal relations,<br />
team building abilities, effective communication and presentation<br />
skills. Focus on developing leadership skills and building talent for<br />
the future and the process of improving organizational and human<br />
capability through competency mapping of managerial positions in all<br />
areas of the company’s operations, continued as a major initiative.<br />
The Company has put great emphasis on the project “<strong>Clariant</strong><br />
Excellence” and has trained 4 black belts and 21 green belts in the<br />
Lean Six Sigma process to identify further opportunities of cost<br />
savings and process improvements.<br />
The Company is committed to provide the right environment to<br />
it’s employees to work and to inculcate a sense of ownership and<br />
pride.<br />
Cordial relations built on the strength of mutual trust and faith<br />
in each other, prevailing at all locations, helped the Company in<br />
downsizing the work force, earlier engaged in operations, which<br />
are discontinued at Cuddalore in Tamilnadu and Balkum in Thane.<br />
The voluntary retirement scheme, offering one of the best packages<br />
prevalent in the industry, announced by the Company was well<br />
responded to and a sum of Rs. 2810 lakhs were paid during the year<br />
to 161 employees at all levels in the organisation. The total number<br />
of employees on the rolls of the Company as at December 31, <strong>2009</strong><br />
was 945 against 1,172 on December 31, 2008.<br />
Industry Structure and Development<br />
The Indian chemicals and petrochemicals industry is worth about<br />
US$ 78 billion. The industry with investments worth US$ 60 billion,<br />
contributes 3% to India’s GDP and 14% to total exports, employs<br />
around 1 million is the largest in Asia and 12th in the world. Till the<br />
recent slowdown, the industry was growing at 6%-10% per year,<br />
as against the global average of 3%-4%. The industry exports more<br />
than 50% of its production and thus is deeply connected to the global<br />
economy. However, India’s share in global exports and imports is<br />
less than 2%. The industry had an export growth rate of 27%, which<br />
has come down to 16%, as a result of the global economic crisis.<br />
Half of the chemical market is currently occupied by basic chemicals<br />
such as petrochemicals and fertilizers. The rest comprises evenly<br />
of specialty chemicals such as paints, dyestuffs and intermediates<br />
and knowledge chemicals such as pharmaceuticals, bio chemicals<br />
and agro chemicals. The growth rate of basic chemicals is 7-8% but<br />
that of specialty and knowledge chemicals is 13-15% and a great<br />
expectation is placed on its future growth.<br />
India has achieved considerable progress in the production of basic<br />
organic and inorganic chemicals, pesticides, paints, dyestuffs and<br />
intermediates, petrochemicals, fine and specialty chemicals and<br />
toiletry products. With the slash in tariffs, the Indian chemical<br />
industry with well-built systems and segment focused operations is<br />
likely to benefit further. It is not only the country’s oldest industry,<br />
but contributes to India’s growing economy in a phenomenal way.<br />
The industry is highly diversified and serves the basic needs of<br />
many different industry verticals like natural gas, water, oil, metals,<br />
minerals, air, oil, etc and all these verticals eventually bring into the<br />
marketplace an array of products. The companies manufacturing high<br />
value chemicals and compliant with industrial quality standards, are<br />
capable of making their mark not just in India but in the overseas<br />
markets as well.<br />
Indian dyes are in demand world over. Pigments and Dyes are<br />
primarily used in paints, inks, textiles, leather, paper, foodstuffs and<br />
polymers. The textile industry accounts for the largest consumption<br />
of dyestuffs. India has emerged as a global supplier of dyestuffs and<br />
dye intermediates, particularly for reactive, acid, vat and direct dyes<br />
approximately 6% of the world production. The total market of paint<br />
and dyes is about US$ 1 billion with a growth rate of about 10%.<br />
The dyestuff market is highly fragmented with high concentration<br />
in Maharashtra and Gujarat. There are about 25 large and medium<br />
players, which cover 50% market share, while 2000 other organized<br />
players contribute the balance 50%. The per capita consumption of<br />
dyestuff is very low in India (400 gms) as compared to the developed<br />
countries (15 kgs). The plastics & polymer segment is growing steadily<br />
with a very high potential of domestic consumption. It remains one<br />
of the fastest growing markets in the recent past. Many overseas<br />
plastic processors have started investing in India for exports as<br />
well as for domestic consumption. However, the capacities of these<br />
plants remain small.<br />
The Indian textile industry size is estimated to expand significantly<br />
from the present US$ 50 billion and it accounts for around 4% of<br />
the Gross Domestic Products (GDP), 14% of Industrial production and<br />
over 13% of the country’s total export earnings. The textile industry<br />
is capital intensive and in recent years it has invested significantly<br />
on capital assets by acquiring sophisticated new machinery. This<br />
has gone a long way towards upgrading products to international<br />
standards and massive investment is expected further. All this has<br />
enabled the industry to entrench itself firmly and make an entry<br />
into the society of top fashion, formal and leisurewear garments.<br />
India is emerging as a one stop shop for all textiles and clothing<br />
requirements. <strong>Clariant</strong> is a market leader in textile chemicals and<br />
has a significant presence in all segments of the industry including<br />
technical textiles.
20 <strong>Clariant</strong> Chemicals (India) Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
World trade in leather is estimated at about US$ 150 billion and<br />
India’s share is US$ 3.5 billion despite having the advantage of a<br />
large labour force and a wide raw material base. Dwindling exports<br />
in the wake of the global demand slump and stiff competition from<br />
countries like China and Vietnam have resulted into a fall in leather<br />
exports by 17% in dollar terms and 8% in Rupee terms during the<br />
nine months ended December 31, <strong>2009</strong> when compared with the<br />
same period a year ago and the industry expects that the exports<br />
during <strong>2009</strong>-10 will show a decline of about 10-15%. Contrary to the<br />
dismal show by the Indian leather industry, the Company has done<br />
extremely well with a strong growth in exports led by <strong>Clariant</strong> Group<br />
demand. The Company has a wide product range for leather dyeing<br />
and finishing chemicals to cater to the market needs for a variety of<br />
products and is the market leader in wet end chemicals.<br />
The Rs. 16000 crore Indian paper industry is currently investing on<br />
capacity expansion, pollution control measures and environmental<br />
management plans. The total paper demand in the country according<br />
to industry estimates is about 94 lakh tonnes a year with packaging<br />
contributing to about 24% and newsprint 20%. <strong>Clariant</strong>’s paper<br />
business offers a wide range of high performance products for<br />
improving whiteness, strength, strong and bright shades with<br />
excellent printability.<br />
The Indian paint industry has seen remarkable changes during the<br />
last decade. In this period, almost every major multinational has<br />
established or entrenched their presence, incumbents have built<br />
on their market position and the industry has become far more<br />
sophisticated in terms of the products it manufactures, the way it<br />
sells to customers and the range of technologies it uses. Overall<br />
paint demand in India has grown 1.5 times the GDP growth, though<br />
some segments have done better. The Company has positioned<br />
itself as preferred supplier of pigments, additives and intermediates<br />
to major paint, coatings and ink manufacturing companies in the<br />
country.<br />
The personal care sector in India is set for a lot of action by way<br />
of expansion in capacity, fast replacement of product portfolio and<br />
investment in research and development projects to sustain its<br />
growth momentum in the Rs. 9500 crore personal care businesses.<br />
<strong>Clariant</strong> with its strong global presence is looking forward for<br />
improving its position in this segment.<br />
The Company has diversified product ranges catering to the needs<br />
of variety of user industries and these are classified into two broad<br />
business segments of Intermediates and Colours and Dyes and<br />
Specialty Chemicals. Details on these segments are described in<br />
this report under ‘Segment wise performance’.<br />
Outlook<br />
In spite of deceleration from 9% GDP growth to about 7% GDP<br />
growth in <strong>2009</strong>-10, India remains the second largest growing<br />
economy in the world. The index of industrial production has surged<br />
by an incredible 16.8% in December <strong>2009</strong> against a contraction of<br />
0.2% a year ago. For the period April-December <strong>2009</strong>, the average<br />
industrial growth rate worked out to 8.6%, much better than the<br />
growth of 3.6% during the same period in 2008. Based on the growth<br />
rate of the broad industry groups, the trend during the current year<br />
is encouraging.<br />
The Indian chemical industry is on a high growth trajectory and<br />
through a series of efforts, expected to achieve USD 100 billion<br />
in the upcoming years. The industry today is into manufacturing<br />
of a wide range of goods including fine and specialty chemicals,<br />
drugs and pharmaceuticals, dyes and pigments, agrochemicals<br />
and fertilizers, pesticides, plastics and petrochemicals etc. and its<br />
contribution to the Indian manufacturing sector is about 18%. The<br />
positive factor for the Indian chemical industry is the demand for its<br />
products that is largely driven by the domestic market. Considering<br />
the very low per capita consumption ratio, it has great potential for<br />
fast growth and with its inherent strengths of low cost and highly<br />
qualified workforce, it is expected to play the role of an export base<br />
to Europe and Middle East. However, the industry is yet to make<br />
its presence felt in a significant way in the international markets<br />
and factors like global recession and financial crises had significant<br />
impact on the manufacturing and export sector of the industry.<br />
Although <strong>2009</strong> has seen enough challenges, recession and<br />
downturns, the Company has withstood all such pressures and<br />
strongly positioned itself to meet the challenges of the future. While<br />
some of the effects of the global economic scenario still persist, 2010<br />
promises to be much better to forge ahead. Considering the strong<br />
presence in different market segments, it’s technological ability<br />
to provide solutions to user industries, rapid response in adapting<br />
to change in fashion and preference of people, global affiliation<br />
and brand image of <strong>Clariant</strong> world-wide, the future outlook of the<br />
Company’s business is positive and sustainable growth is expected<br />
in coming years.<br />
Opportunities and Threats<br />
The overall performance of the Indian chemical industry even<br />
when the world is reeling under financial and economic recession<br />
is satisfactory given the performance in the domestic markets.<br />
Global recession is a reminder call for domestic industries to upgrade<br />
the quality of products, technical services, cost competitiveness<br />
and processing efficiencies, etc. Although small in size, the Indian<br />
chemical industry is a net exporter. Per capita consumption in<br />
each of its industry segment is very low and is about 1/10th<br />
of world average, thus hold strong potential to grow in domestic<br />
markets.<br />
To counter the negative fallout of the global slowdown on the Indian<br />
economy, the Government responded by providing a substantial fiscal<br />
expansion in the form of tax relief to boost demand and increased<br />
expenditure on public projects. In view of good performance by<br />
industries, financial stimulus if rolled back, could affect domestic<br />
demand in certain sectors for a temporary period.<br />
The Business environment for the chemical industry globally has<br />
been changing very fast and if the Indian chemical businesses have<br />
to hold against competition they have to change and adopt their<br />
strategies, methodology of working and organisational structure.<br />
China is becoming the biggest threat to the Indian chemical industry<br />
with their excess capacity and controlled exchange rate of Yuan,<br />
making Indian products uncompetitive.<br />
The area of challenge and concerns which the Indian chemical industry<br />
will need to face are non-tariff barriers, by way of international<br />
treaties, which at times appear well and innocuous but have been
Management Discussion & Analysis<br />
21<br />
used against the Indian chemical industry in the past and will have<br />
to be reckoned with, as our industry makes inroads into global trade<br />
in chemicals so far dominated by developed nations. A plethora of<br />
taxes, levies and duties charged while transacting business within<br />
and across states, often exceeds the duty barrier that exporters to<br />
the Indian market face. The high cost of internal transactions needs<br />
to be appropriately addressed so as to provide Indian manufacturers<br />
a level playing field. India still has a problem of infrastructure like<br />
insufficient power supply and underdeveloped road network.<br />
Highly developed technology, in-depth research capabilities,<br />
backward and forward linkages, development of domestic capacity<br />
to decrease the dependence on imports are some of the crucial<br />
factors that need to be taken into consideration. Nowadays, safety,<br />
health and environment protection issues have become the majortalking<br />
point in almost all industries and even in the Indian chemical<br />
industry too. The Indian chemical manufacturers are addressing the<br />
issue on a war-footing.<br />
Government’s initiative to promote six Petroleum, Chemicals and<br />
Petrochemical Investment Regions (PCPIR) is hoped to change<br />
the fortunes for the Indian Chemical industry. Despite the difficult<br />
time, the dyestuff and specialty chemicals industry holds a lot of<br />
promise for India. The industry is a potential powerhouse benefiting<br />
from comparative low labour costs, an excellent army of technical<br />
manpower, capabilities for research and development facilities,<br />
a huge and fast developing domestic market and the potential to<br />
increase it’s share in global markets.<br />
A diversified product range, proactive preparedness in adjusting to<br />
demand and supply levels and aggressive customer support services<br />
have provided a cushion to the Company to withstand the pressure<br />
of global meltdown and downturn in the industry. With strong<br />
technology support from the parent company, state of art product<br />
development facilities, a world class product safety laboratory<br />
with excellent product testing facilities and continuous emphasis<br />
on cost management, the Company is well prepared to exploit the<br />
opportunities both in the domestic and global markets to improve<br />
it’s presence. The Company has placed continuous emphasis on cost<br />
management.<br />
Risks and Concerns<br />
<strong>Clariant</strong>’s approach to Risk Management is designed to clarify risk<br />
levels and encourage entrepreneurial behavior throughout the Group.<br />
The Company’s risk management policy is in line with <strong>Clariant</strong>’s global<br />
guidelines on risk management and adequate measures have been<br />
adopted by the Company to combat various risks including business<br />
risks (competition, consumer preferences, technology changes),<br />
financial risks (cost, credit, liquidity, foreign exchange) hazard risks<br />
(environment, safety and health), operational risks (system, process,<br />
people) and regulatory and compliance risks.<br />
The Company has adopted a focused approach towards risk<br />
management in the form of a corporate insurance program which<br />
has the goal of optimizing the financing of insurable risks by using<br />
a combination of risk retention and risk transfer techniques. The<br />
program covers any risks relating to business interruption resulting<br />
from property damage and legal liability resulting from operations<br />
and personal injury.<br />
The Company has in place a responsive system to assess the<br />
capabilities of all its vendors and distributors before being selected<br />
and their performance is periodically reviewed for managing risks,<br />
if any. The Company’s approach in providing solutions and servicing<br />
it’s customers for over five decades, it’s attitude towards the vendors<br />
and customers to consider them as it’s partners in progress provide<br />
the Company requisite comforts to mitigate risks arising out of<br />
competition and loyalty. The Company has put in place a system<br />
driven credit control procedure and proactive approach to prepare<br />
a liquidity planner and a constant review thereof to ensure that at<br />
any given point of time there is adequate cover available to meet<br />
its liabilities.<br />
<strong>Clariant</strong> as a group is proactively committed to taking into<br />
consideration environment protection and safety in all our activities.<br />
Risk associated with protection of environment, safety of operations<br />
and health of people at work is monitored regularly with reference to<br />
statutory regulations prescribed by the government authorities and<br />
guidelines defined by <strong>Clariant</strong>. The Company does not merely fulfill<br />
the legal requirements concerning emission, waste water and waste<br />
disposal, but actually works to even stricter self imposed standards.<br />
The Company has created a benchmark of completing the internal<br />
landmark of 50 lakhs man-hours of accident free working between<br />
November 2007 and January 2010.<br />
The Company’s business critical software is operated on a server with<br />
regular maintenance and back-up of data. The global communication<br />
network is managed centrally and is equipped to deal with failures<br />
and breakdowns. Updated tools are regularly loaded to ensure a<br />
virus free environment.<br />
The Company operates within the letter and spirit of all applicable<br />
laws. The Company has put in place a system driven legal compliance<br />
manual and certification process that ensures compliance of<br />
regulatory provisions and the same is periodically reviewed to<br />
avoid any deviations and regularly updated to keep pace with the<br />
regulatory changes. The <strong>Clariant</strong> code of conduct covers responsible<br />
behavior, protecting the reputation of the company and reducing<br />
risks for our shareholders.<br />
Cautionary Statement<br />
Certain statements under “Management Discussion & Analysis”<br />
describing the Company’s objectives, projections, estimates,<br />
expectations or predictions may be forward looking statement<br />
within the meaning of applicable securities laws and regulations.<br />
Although the expectations are based on reasonable assumptions,<br />
the actual results could materially differ from those expressed or<br />
implied, since the Company’s operations are influenced by many<br />
external and internal factors beyond the control of the Company.<br />
The Company assumes no responsibility to publicly amend,<br />
modify or revise any forward looking statements, on the basis of<br />
any subsequent developments, information or events
22 <strong>Clariant</strong> Chemicals (India) Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
<strong>Report</strong> on Corporate Governance<br />
Company’s philosophy<br />
<strong>Clariant</strong> Chemicals (India) Ltd., part of the <strong>Clariant</strong> Group, committed<br />
to the highest standards of Corporate Governance, has over the years<br />
practised good corporate governance and is committed to create<br />
value to all its shareholders. The Company is driven by its core<br />
values, viz. ethical practices, concern for people at work, delight of<br />
customers and striving to meet the stakeholders’ expectations and<br />
societal aspirations.<br />
The Company believes that governance should be functioning<br />
beyond compliances, adherence to regulatory frame work, financial<br />
prudence and should create fair and transparent processes and<br />
reporting systems. The focused approach, professionalism of Board<br />
and fair and transparent processes have led your Company to new<br />
heights. Corporate Governance has been strengthened by formulating<br />
and adopting Code of Conduct for directors and senior members of<br />
management. The Company makes best efforts to use best-in-class<br />
technology, focus on providing solution and service to its customers<br />
thereby creating value chain, promote highest levels of safety in its<br />
operations, maintain better health of its employees, provide a clean<br />
environment for sustainable development and meet the objectives of<br />
shareholders by providing them fair returns and value.<br />
1. Group Structure:<br />
Your Company is an affiliate of <strong>Clariant</strong> AG, Switzerland, a global<br />
leader in the field of specialty chemicals represented on five continents<br />
with over 100 group companies and headquartered in Muttenz<br />
near Basel. In accordance with the Group‘s business structure, the<br />
Company operates in four business divisions viz. TLP (Textile, Leather<br />
& Paper), P&A (Pigments and Additives), Functional Chemicals and<br />
Masterbatches and these are classified in two business segments<br />
Intermediates & Colours and Dyes & Specialty Chemicals.<br />
2. Board of Directors<br />
2.1 Composition and the Changes:<br />
The Company as on December 31, <strong>2009</strong> had seven Directors<br />
comprising of six non-executive Directors including<br />
Chairman. The day to day management of the Company<br />
is conducted by Vice-Chairman and Managing Director<br />
subject to supervision and control of the Board of<br />
Directors. The independent Directors take active part in the<br />
Board and Committee Meetings, which adds value<br />
in the decision making process of the Board of<br />
Directors.<br />
Mr. Heiner Meier led the team of management as Vice-<br />
Chairman & Managing Director for the year. However, upon<br />
termination of his agreement, Mr. Peter M. Palm is appointed<br />
as the Vice-Chairman and Managing Director in his place with<br />
effect from January 1, 2010. Mr. Dominik Strebel resigned<br />
during the year and Mr. Walter Kindler was appointed in<br />
the casual vacancy caused by his resignation. However,<br />
Mr. Kindler resigned as Director as of December 31, <strong>2009</strong><br />
and Mr. Henri Schloemer is appointed as Additional Director<br />
effective from January 1, 2010. Mr. Peter Lindner resigned<br />
as of December 31, <strong>2009</strong> and Mr. Heiner Meier is appointed<br />
with effect from January 1, 2010, in the casual vacancy<br />
caused by resignation of Mr. Lindner.<br />
The composition and category of the Board of Directors as<br />
at December 31, <strong>2009</strong>, the number of other directorships/<br />
committee memberships held by them and also the<br />
attendance of the Directors at the Board meetings of the<br />
Company is as under:<br />
No. of other Directorships and Committee memberships/<br />
Particulars of Attendance<br />
Chairmanships in Indian Public Companies#<br />
Name of the Director Category<br />
Number of Board meetings Last AGM held Other Directorships* as Committee Committee<br />
Held Attended on April 29, <strong>2009</strong> on December 31, <strong>2009</strong> Memberships Chairmanships<br />
Mr. R. A. Shah<br />
Non-Executive<br />
6 6 Attended 14 10 5<br />
DIN 00009851<br />
Independent<br />
Mr. H. Meier<br />
Executive 6 6 Attended None 1 None<br />
DIN 00726512<br />
Mr. P. Lindner<br />
Non-Executive 6 1 Attended None None None<br />
DIN 01417833<br />
Dr. A. Walde<br />
Non-Executive 6 0 Not Attended None None None<br />
DIN 01417867<br />
Mr. B. S. Mehta<br />
Non-Executive<br />
6 6 Attended 14 10 5<br />
DIN 00035019<br />
Independent<br />
Diwan A. Nanda<br />
Non-Executive<br />
6 4 Attended 5 3 1<br />
DIN 00034744<br />
Independent<br />
Mr. Dominik Strebel Non-Executive 1 0 NA None None None<br />
DIN 01859786<br />
Mr. Walter Kindler Non-Executive 5 1 Attended None None None<br />
DIN 02511867<br />
* This excludes alternate directorships/directorships in private limited companies, foreign companies and companies governed by Section 25 of the Companies Act, 1956 wherever applicable.<br />
# It excludes committees other than Audit Committee, Shareholders/Investor Grievance Committee and companies other than public limited company but includes committee membership/ chairmanship<br />
in <strong>Clariant</strong> Chemicals (India) Ltd.
<strong>Report</strong> on Corporate Governance<br />
23<br />
2.2 Profile of Members of the Board of Directors being<br />
appointed/re-appointed:<br />
Mr. Peter Palm<br />
Mr. Peter Palm a German national has done his Certificate<br />
of Business Administration from Chamber of Commerce<br />
Frankfurt Am Main awarded in 1970 and completed<br />
management training in UK, Switzerland and other countries.<br />
Before joining the Company as Vice-Chairman and Managing<br />
Director he had international postings in India, Afghanistan,<br />
Sri Lanka, Saudi Arabia, Nigeria, South Africa and since<br />
the year 2005 he was Country President of <strong>Clariant</strong> UK &<br />
Ireland.<br />
Diwan A. Nanda<br />
Diwan A. Nanda, a gold medalist from the Indian<br />
Institute of Management, Ahmedabad has over 40 years<br />
of vast experience in marketing & advertising and has<br />
held various positions in academics and advertising.<br />
He started his career in marketing in Hindustan Lever<br />
Limited and later founded ‘Rediffusion’ an advertising<br />
agency in 1973 and is on the board of Rediff.com India Ltd.<br />
and Eveready Industries (India) Ltd. He is the recipient of<br />
AAAI Premnarayan award for outstanding contribution to<br />
advertising in India in 2002.<br />
Dr. Henri Schloemer<br />
Dr. Henri Schloemer, a German national, received his<br />
doctorate degree in Business Administration from the<br />
German University of Bochum. He joined <strong>Clariant</strong> 1998<br />
and later became CFO for <strong>Clariant</strong>’s German operations. In<br />
2007 he was appointed as Managing Director of <strong>Clariant</strong><br />
Germany and later in <strong>2009</strong> became Head of the Corporate<br />
Affairs department at <strong>Clariant</strong>’s headquarters in Muttenz,<br />
Switzerland, responsible for strategy, mergers & acquisitions<br />
and worldwide regions for <strong>Clariant</strong>.<br />
2.3 Board Meetings and Agenda:<br />
In compliance with the provisions of clause 49 of the<br />
listing agreement, the Board meets at least once in every<br />
quarter to review the performance and to deliberate and<br />
consider other items on the agenda. Six meetings were<br />
held during the year on February 20, <strong>2009</strong>, April 29, <strong>2009</strong>,<br />
May 14, <strong>2009</strong>, July 24, <strong>2009</strong>, October 29, <strong>2009</strong> and<br />
December 14, <strong>2009</strong>.<br />
The agenda of the Board of Directors’ Meeting interalia<br />
includes the following:<br />
• <strong>Annual</strong> revenue and capital investment budgets;<br />
• The unaudited quarterly, half-yearly financial results<br />
and the audited annual accounts of the Company,<br />
both consolidated and on a standalone basis<br />
including segment wise revenue, results and capital<br />
employed;<br />
• Declaration of dividend;<br />
• Sale of material nature, of investments, assets,<br />
business, which is not in normal course of<br />
business;<br />
• Investment in capital projects of material nature;<br />
• The minutes of the Board meetings of subsidiary<br />
company;<br />
• Minutes of the meetings of Board, Audit and<br />
Investors’ grievance committees, as also the<br />
resolutions passed by circulation;<br />
• Internal audit reports and the status on<br />
implementation of suggestions;<br />
• Cost audit and secretarial audit reports;<br />
• Proposals for joint venture, collaboration, merger &<br />
acquisition, if any;<br />
• Making of loans or investment of surplus funds;<br />
• Appointment of statutory auditors, cost auditors &<br />
internal auditors;<br />
• Appointment of key management positions below<br />
the Board level;<br />
• Issues relating to shareholders – such as ratification<br />
of transfers, demat status, pending grievances,<br />
issue of duplicate share certificates, etc.;<br />
• Materially important show cause, demand,<br />
prosecution and penalty notices;<br />
• Fatal or serious accidents, dangerous occurrences,<br />
any material effluent or pollution problems;<br />
• Defaults in payment of statutory dues, if any;<br />
• Review of Foreign exchange exposure and exchange<br />
rate movement, if material;<br />
• Contracts in which Director(s) are deemed to be<br />
interested;<br />
• Matters requiring statutory/Board approvals;<br />
• Review of related party transactions;<br />
• Status on compliance of regulatory/statutory and<br />
listing requirements;<br />
• Issue/revocation of Power of Attorney;<br />
• Commission payable to Directors;<br />
• General notices of interest of Directors;<br />
• Appointment of Managing and other Directors.<br />
3. Board Committees:<br />
The Board has constituted two committees viz., Audit<br />
committee and Investor Grievance Committee. The roles and<br />
responsibilities assigned to these committees covered under<br />
the terms of reference approved by the Board are subject to<br />
review by the Board from time to time and the minutes of<br />
the meetings of these committees are reviewed and taken<br />
note by the Board. The details as to the composition, terms<br />
of reference, number of meetings and related attendance<br />
etc. of these committees are provided below.
24 <strong>Clariant</strong> Chemicals (India) Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
3.1 Audit committee:<br />
3.1.1 Composition:<br />
Mr. R. A. Shah, Diwan A. Nanda and Mr. H. Schloemer are<br />
the members of the Audit Committee after January 1, 2010.<br />
Mr. Dominik Strebel was member of the Audit Committee<br />
till February 20, <strong>2009</strong> and consequent upon his resignation<br />
Mr. Walter Kindler was inducted as member of Audit<br />
Committee till December 31, <strong>2009</strong>. Mr. R. A. Shah chairs<br />
the committee. The statutory auditors, internal auditors and<br />
cost auditors are also invited to attend the audit committee<br />
meetings from time to time. The composition of the Audit<br />
committee meets the requirements of Section 292A of<br />
the Companies Act, 1956 and Clause 49 of the Listing<br />
Agreement.<br />
Mr. H. Meier, the then Vice-Chairman & Managing Director<br />
attended the Audit Committee meetings as special invitee.<br />
Mr. B. L. Gaggar, Director Finance & Company Secretary<br />
represents the finance function and also acts as Secretary<br />
to the committee. All major variances affecting the<br />
performance of the Company are discussed and explained.<br />
During the year four meetings of the Audit Committee were<br />
held on February 20, <strong>2009</strong>, April 29, <strong>2009</strong>, July 24, <strong>2009</strong> and<br />
October 29, <strong>2009</strong>.<br />
Attendance at Audit Committee meetings:<br />
Name of Director Category Status Number of Meetings<br />
Held<br />
Attended<br />
Mr. R. A. Shah Independent Chairman 4 4<br />
Diwan A. Nanda Independent Member 4 4<br />
Mr. Dominik Strebel<br />
(Up to February 20, <strong>2009</strong>)<br />
Mr. W. Kindler<br />
(from February 20, <strong>2009</strong>)<br />
Non-Independent Member 1 0<br />
Non-Independent Member 3 1<br />
3.1.2 Scope of Audit Committee:<br />
The Audit Committee assists the Board in fulfilling<br />
its obligations relating to corporate accounting and<br />
reporting practices, financial and accounting controls and<br />
presentation of financial statements and thus provides<br />
effective supervision of the financial reporting process. The<br />
committee also reviews the appointment, independence<br />
and performance of statutory auditors, the performance of<br />
internal auditors and the Company’s internal control and<br />
risk management policies. The terms of reference of the<br />
audit committee are in accordance with clause 49(II) (D) of<br />
the listing agreement entered into with the relevant stock<br />
exchanges and include:<br />
(i)<br />
Overseeing the Company’s financial reporting<br />
process and the disclosure of its information to<br />
ensure that the financial statements are correct,<br />
sufficient and credible;<br />
(ii)<br />
(iii)<br />
Recommending to the Board, the appointment, reappointment<br />
and, if required, the replacement or<br />
removal of statutory auditors and fixation of fee for<br />
audit and other services;<br />
Reviewing with the management, the annual<br />
financial statements before submission to the Board<br />
for approval.<br />
The Audit Committee is empowered to exercise<br />
its rights under clause 49(II)(C) and also reviews<br />
various information prescribed under clause 49(II)(E)<br />
of the listing agreement entered into with the<br />
relevant Stock Exchanges.<br />
3.2 Remuneration Committee:<br />
The Company has not constituted a remuneration Committee<br />
as compensation/remuneration payable to the directors are<br />
approved by the shareholders in the general meeting.<br />
The Company has no pecuniary relationship or transaction<br />
with its Non-executive directors other than payment of<br />
commission, which has been approved by the shareholders<br />
and payment of dividend on equity shares, if any, held by<br />
directors in the Company. The Company has been seeking<br />
legal consultations from M/s. Crawford Bayley & Co.,<br />
Advocates & Solicitors on various matters and a sum of<br />
Rs. 33,06,705 (Previous year Rs. 3,65,363) has been paid as<br />
professional fees to the said firm during the year ended at<br />
December 31, <strong>2009</strong>. Mr. R. A. Shah, who is the Chairman<br />
of the Company, is the senior partner of the said firm.<br />
The aforesaid professional fee is not considered material<br />
enough that may have potential conflict with the interest<br />
of the Company and to impinge on the independence of<br />
Mr. Shah.<br />
The details of remuneration paid to Directors for the year<br />
ended December 31, <strong>2009</strong> is as follows:<br />
Rupees (in Lakhs)<br />
Name of Director<br />
Sitting<br />
fees<br />
Salary,<br />
Perquisites,<br />
Contribution<br />
to Provident<br />
Fund<br />
Compensation<br />
for loss<br />
of office<br />
Commission<br />
Total<br />
Mr. R. A. Shah 0.50 – – 4.00 4.50<br />
Mr. H. Meier – 149.51 40.83 26.75 217.09<br />
Mr. B. S. Mehta 0.45 – – 3.00 3.45<br />
Diwan A. Nanda 0.50 – – 3.00 3.50<br />
The Company has no scheme for grant of stock options to<br />
the Directors.<br />
3.3 Investors’ Grievance Committee:<br />
The Investor’s Grievance Committee, during the year,<br />
comprised of Diwan A. Nanda non-executive independent<br />
director as Chairman and Mr. H. Meier Vice-Chairman<br />
& Managing Director as a member. Consequent upon<br />
the termination of agreement with Mr. H. Meier,
<strong>Report</strong> on Corporate Governance<br />
25<br />
Mr. Peter Palm replaces as member of the committee<br />
effective from January 1, 2010.The committee, inter alia,<br />
approves issue of duplicate share certificates and oversees<br />
and reviews all matters connected with transfer of shares<br />
of the Company. The committee also looks into redressal<br />
of shareholders’ complaints related to transfer of shares,<br />
non receipt of annual report and dividend warrant etc. The<br />
committee monitors implementation and compliance of<br />
the Company’s Code of Conduct for prohibition of insider<br />
trading in pursuance of SEBI (Prohibition of Insider Trading)<br />
Regulations, 1992. The committee met twice on April 29,<br />
<strong>2009</strong> and October 29, <strong>2009</strong> during the year and these were<br />
attended by both the members.<br />
To expedite the process of physical transfer of shares,<br />
the Board has delegated the authority to Mr. B. L. Gaggar<br />
Director Finance & Company Secretary who is the<br />
compliance officer of the Company. In accordance with<br />
the authority granted by the Board, Mr. Gaggar deals with<br />
transfer/transmission of physical shares, split/sub-division<br />
and consolidation of physical shares and rematerialisation<br />
of shares. The physical transfers of shares are ratified at<br />
the Board meetings.<br />
M/s. Sharepro Services (India) Private Limited, the Registrar<br />
and Share Transfer Agents, deals with all shareholders<br />
related matters for both physical and demat holding. The<br />
Company has retained the services of a practicing Company<br />
Secretary to perform Secretarial Audit every quarter. No<br />
non-compliance from established procedures is reported.<br />
Pursuant to Clause 41 of the Listing Agreements, investor<br />
grievance redressal status is reported every quarter to the<br />
Stock Exchanges and the numbers of unattended grievances<br />
are published in the news papers along with financial<br />
results.<br />
There was one investor complaint pending as on<br />
December 31, <strong>2009</strong> which is being attended.<br />
4. Subsidiary Company<br />
The Company does not have material non-listed subsidiary<br />
whose turnover or net worth (i.e. paid-up capital and free<br />
reserves) exceeds 20% of the consolidated turnover or<br />
net worth respectively, of the listed holding Company.<br />
Chemtreat Composites India Private Limited, a wholly owned<br />
subsidiary Company, has its production base at Khopoli,<br />
in the Maharashtra state. As a majority shareholder, the<br />
Company nominates its representatives on the Board of the<br />
subsidiary company and monitors the performance through<br />
quarterly review of financial statements by Audit committee<br />
and review of minutes of the Board meeting by Company’s<br />
Board.<br />
Mr. Heiner Meier, Mr. Walter Kindler and Mr. B. L. Gaggar<br />
were the Directors of Chemtreat Composites India Private<br />
Ltd. Upon resignations of Mr. Meier and Mr. Kindler with<br />
effect from January 1, 2010, Mr. Peter Palm and Mr. Henri<br />
Schloemer are nominated as the Directors on the board of<br />
subsidiary company.<br />
5. General Body Meetings:<br />
Location, date and time of the <strong>Annual</strong> General Meetings<br />
of the Company held during the preceding 3 years and the<br />
Special Resolutions passed thereat are as follows:<br />
AGM Venue Date and<br />
Time<br />
50th<br />
51st<br />
52nd<br />
Y. B. Chavan<br />
Auditorium,<br />
Gen. Jagannath<br />
Bhosale Marg,<br />
Next to Sachivalaya<br />
Gymkhana,<br />
Mumbai 400 021<br />
Y. B. Chavan<br />
Auditorium,<br />
Gen. Jagannath<br />
Bhosale Marg,<br />
Next to Sachivalaya<br />
Gymkhana,<br />
Mumbai 400 021<br />
Y. B. Chavan<br />
Auditorium,<br />
Gen. Jagannath<br />
Bhosale Marg,<br />
Next to Sachivalaya<br />
Gymkhana,<br />
Mumbai 400 021<br />
April 19, 2007<br />
4.00 p.m.<br />
April 17, 2008<br />
4.00 p.m.<br />
April 29, <strong>2009</strong><br />
4.00 p.m.<br />
Special Resolutions<br />
Passed<br />
No special resolution.<br />
i) Enhancement of the<br />
borrowing limits of the<br />
Company from<br />
Rs. 125 crores to Rs. 300<br />
crores.<br />
ii) Payment of commission<br />
to the Directors other<br />
than Managing Director.<br />
i) Re-appointment of<br />
Mr. H. Meier as the<br />
Vice-Chairman &<br />
Managing Director.<br />
ii) Amendment of Articles<br />
of Association of the<br />
Company.<br />
There was no postal ballot conducted during <strong>2009</strong> and any<br />
of the preceding three years.<br />
6. Disclosures:<br />
6.1 Materially significant related party transactions:<br />
The Company has not entered into any transactions of<br />
material nature, with its promoters, the directors, or the<br />
senior management personnel, their subsidiaries or relatives<br />
etc. that may have potential conflict with the interests of<br />
the Company. The disclosure in respect of related party<br />
transactions is provided in the notes to the accounts. All<br />
contracts with the <strong>Clariant</strong> affiliates entered into during<br />
the year are in the normal course of business and have no<br />
potential conflict with the interest of the company at large<br />
and are carried out on an arm’s length basis at fair market<br />
value.<br />
6.2 Code of Conduct<br />
The Board of Directors has adopted the Code of Conduct<br />
for Directors and senior management personnel and the<br />
same has been placed on the Company’s website. The<br />
Code has been circulated to all the members of the Board<br />
and senior management personnel and the compliance<br />
of the same is affirmed by them annually. In addition, a<br />
standard international Code of Business Conduct formulated<br />
by <strong>Clariant</strong> Group is applicable to all employees of the<br />
Company.
26 <strong>Clariant</strong> Chemicals (India) Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
The Vice-Chairman & Managing Director has confirmed the<br />
compliance of code of conduct and as required under subclause<br />
I(D) of clause 49 of the listing agreement given a<br />
declaration as under:<br />
“In accordance with sub-clause I(D) of Clause 49 of the<br />
Listing Agreement with the Stock Exchanges, I hereby<br />
confirm that, all the Directors and the Senior Management<br />
Personnel of the Company have affirmed compliance with<br />
the code of conduct applicable to them, for the year January<br />
to December, <strong>2009</strong>”.<br />
6.3 Prohibition of Insider Trading:<br />
The Company has framed its Insider Trading Regulations<br />
wherein rules for the preservation of price sensitive<br />
information, pre-clearance of trade, monitoring and<br />
implementation are framed. This code is applicable to all<br />
Directors and such employees of the Company who are<br />
incidental to have access to unpublished price sensitive<br />
information relating to the Company. Transaction for dealing<br />
in the prescribed volume of the security of the Company<br />
during the prescribed time requires prior approval from the<br />
Company.<br />
None of the Directors is holding any shares in the Company<br />
as on December 31, <strong>2009</strong>.<br />
7. Means of Communication:<br />
• The Company has 30,656 shareholders as on<br />
December 31, <strong>2009</strong>. The main channel of<br />
communication to the shareholders is through<br />
annual report which includes inter alia, the<br />
Directors’ <strong>Report</strong>, the Auditors <strong>Report</strong>, <strong>Report</strong><br />
on Corporate Governance, Audited Financial<br />
Statements, Consolidated Financial Statements<br />
and other important information. The Management<br />
Discussion and Analysis <strong>Report</strong> forms part of the<br />
<strong>Annual</strong> <strong>Report</strong>.<br />
• The website of the Company www.clariant.in acts<br />
as the primary source of information regarding<br />
the operations of the Company. Quarterly financial<br />
results and media releases are being displayed on<br />
the Company’s website.<br />
• The <strong>Annual</strong> General Meeting is the principal forum<br />
for face-to-face communication with shareholders,<br />
where the Board responds to the specific queries of<br />
the shareholders.<br />
• Quarterly results, approved by the Board of<br />
Directors and submitted to the Stock Exchanges<br />
in terms of the requirements of clause 41<br />
of the Listing Agreement are published in the<br />
prominent English publications such as Financial<br />
Express/Business Standard and prominent<br />
vernacular publications such as Maharashtra Times/<br />
Nav Shakti/Sakal.<br />
8. General Shareholder Information:<br />
8.1 <strong>Annual</strong> General Meeting<br />
Date & Time:<br />
Friday, April 23, 2010 at 04.00 p.m.<br />
Venue:<br />
Y. B. Chavan Auditorium, Gen. Jagannath Bhosale Marg,<br />
Next to Sachivalaya Gymkhana, Mumbai-400 021.<br />
8.2 Voting rights:<br />
In terms of Articles 93 to 105 of the Articles of Association<br />
of the Company, every member present in person or proxy,<br />
attorney or representative at the general meeting of the<br />
members shall have the following voting rights:<br />
• On a show of hands: one vote for a member present<br />
in person;<br />
• On a poll: one vote for each equity share registered<br />
in the name of the member or held by the beneficial<br />
owner;<br />
• Proxy has no right to speak.<br />
8.3 Financial Calendar:<br />
The Company’s financial year is period of twelve months<br />
from January to December.<br />
Dates for Audited/Unaudited Results:<br />
Financial Year<br />
January-December<br />
<strong>2009</strong><br />
Financial Year<br />
January-December<br />
2010 (Proposed)<br />
January – March April 29, <strong>2009</strong> April 23, 2010<br />
April – June July 24, <strong>2009</strong> July, 2010<br />
July – September October 29, <strong>2009</strong> October, 2010<br />
October – December February 19, 2010 February, 2011<br />
<strong>Annual</strong> General Meeting April 23, 2010 April, 2011<br />
8.4 Dates of Book Closure<br />
Book Closure dates<br />
January-December<br />
2010<br />
April 13, 2010 to<br />
April 23, 2010 (Both days<br />
inclusive)<br />
Payment of Dividend On or after April 24,<br />
2010<br />
January-December<br />
2011 (Proposed)<br />
Second fortnight of April<br />
2011<br />
Immediately after AGM
<strong>Report</strong> on Corporate Governance<br />
27<br />
8.5 Listing of Shares:<br />
Shares of the Company are listed on Bombay Stock Exchange<br />
Ltd. (BSE) and National Stock Exchange of India Limited<br />
(NSE).<br />
The Company has paid the listing fees upto March 31, 2010<br />
to both the Stock Exchanges.<br />
8.6 Stock Code:<br />
Name of the Stock<br />
Exchange<br />
Stock Code<br />
BSE CLARICHEM Rs. 467.90<br />
NSE CLNINDIA Rs. 470.40<br />
Closing Price as on<br />
31.12.<strong>2009</strong><br />
Company Registration Number with ROC/Ministry of<br />
Corporate Affairs<br />
CIN : L24110MH1956PLC010806<br />
ISIN : INE492A01029<br />
8.7 Stock Market Data Price Rupees per share:<br />
Month<br />
Bombay Stock Exchange<br />
(BSE)<br />
<strong>2009</strong> High Rs. Low Rs. Volume<br />
(Nos.)<br />
National Stock Exchange<br />
(NSE)<br />
High Rs. Low Rs. Volume<br />
(Nos.)<br />
January 179.90 145.00 92853 179.65 145.00 39013<br />
February 175.90 144.30 563745 175.50 146.10 413017<br />
March 205.00 164.00 934184 205.00 162.70 346991<br />
April 213.85 153.00 344594 214.40 170.00 415259<br />
May 246.00 175.10 454303 245.80 180.10 418189<br />
June 277.00 224.05 305460 272.80 225.25 155536<br />
July 318.65 233.00 248523 326.40 234.50 122695<br />
August 320.00 279.00 157878 314.75 280.00 141513<br />
September 367.00 308.00 229551 367.00 309.00 183248<br />
October 389.90 350.00 204675 390.00 351.05 124781<br />
November 422.95 360.10 176262 424.00 352.50 132042<br />
December 485.00 349.90 600612 485.00 400.10 569941<br />
8.8 Performance of Company’s shares to broad based<br />
index (BSE Sensex):<br />
8.9 Address for correspondence:<br />
Registrar & Share Transfer Agents:<br />
M/s. Sharepro Services (India) Pvt. Limited,<br />
A) 13-AB, Samhita Warehousing Complex,<br />
Gala No. 52-56<br />
2nd Floor, Sakinaka Tel. Exchange Lane,<br />
off Andheri-Kurla Road,<br />
Sakinaka,<br />
Mumbai-400 072.<br />
Tel: 022-6772 0400/6772 0300,<br />
Fax: 022-2859 1568, 2850 8927<br />
Email: sharepro@shareproservices.com<br />
Contact Person: Mrs. Indira Karkera/ Miss Priya<br />
E-mail ID under clause 47(f) of the<br />
Listing Agreement :<br />
<strong>Clariant</strong>@shareproservices.com<br />
B) Investor Relations:<br />
912, Raheja Centre,<br />
Free Press Journal Road,<br />
Nariman Point,<br />
Mumbai-400 021.<br />
Tel.: 022-2288 1568/69, 6613 4700<br />
Fax: 022-22825484<br />
The shareholders having physical shares are requested<br />
to ensure that any correspondence for change of<br />
address, change of bank mandates etc. should be<br />
signed by the first named shareholder. You are further<br />
requested to send supporting documents such as proof of<br />
residence, copy of PAN card whenever change of address<br />
is to be effected.<br />
In case where the shares of the Company are held in electronic<br />
form (that is, in dematerialised form), all communications<br />
concerning rematerialisation of shares, transfer and<br />
transmission, dividends, change of address, furnishing<br />
of alterations in bank account details, nominations, ECS<br />
credit of dividend amount to shareholders’ bank account or<br />
other inquiries should be addressed only to the Depository<br />
Participant (DP) with whom demat account is maintained,<br />
quoting client ID number and not to the Company or the R&T<br />
Agent . This is because once the shares are dematerialised<br />
they become fungible i.e., they lose their distinct identity<br />
such as the folio number, the certificate number, the<br />
distinctive share numbers, etc. and the corresponding credit<br />
for number of shares is given to the individual shareholder<br />
in his account with the concerned DP.<br />
For any assistance from the Company, members may<br />
contact Mr. S. P. Bhattu, Assistant Company Secretary at<br />
the registered office of the Company.<br />
Tel. No. 022-22022161/2283 0882
28 <strong>Clariant</strong> Chemicals (India) Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
8.10 Shareholding Pattern as on December 31, <strong>2009</strong><br />
Sr.<br />
No.<br />
Category<br />
A. Promoter's Holding:<br />
No. of<br />
Shares held<br />
Percentage of<br />
Shareholding<br />
Foreign Promoters<br />
i Ebito Chemiebeteiligungen AG 8167080 30.63<br />
ii <strong>Clariant</strong> International AG 6075000 22.79<br />
iii <strong>Clariant</strong> Participations AG 2660000 9.98<br />
Sub-Total 16902080 63.40<br />
B. Institutional Investors<br />
i Mutual Funds / UTI 1151551 4.32<br />
ii Financial Institutions / Banks 20067 0.07<br />
iii Insurance Companies 479588 1.80<br />
iv Foreign Institutional Investors 58815 0.22<br />
Sub-Total 1710021 6.41<br />
C. Non-Institutional Investors<br />
i Bodies Corporate 1489332 5.59<br />
ii Individuals<br />
a) individual shareholders holding 5748845 21.56<br />
nominal share capital up to<br />
Rs.1 lakh<br />
b) individual shareholders holding 669395 2.51<br />
nominal share capital in<br />
excess of Rs. 1 lakh<br />
iii others<br />
a) Non-Resident (Non-Rep) 72270 0.27<br />
b) Non-Resident (Rep) 48168 0.18<br />
c) Trust 18784 0.07<br />
d) OCB 1850 0.01<br />
Sub-Total 8048644 30.19<br />
TOTAL 26660745 100.00<br />
2,56,09,068 shares of the Company are held in dematerialised<br />
form constituting 96.06% of the paid-up capital, as at<br />
December 31, <strong>2009</strong>. The total number of shareholders as on<br />
Benpos date of December 31, <strong>2009</strong> is 30,656.<br />
8.11 Details of Members holding > 1 % of the paid up<br />
capital of the Company<br />
Sr.<br />
No<br />
Name<br />
As at<br />
December 31, <strong>2009</strong><br />
No. of<br />
shares<br />
As at<br />
December 31, 2008<br />
% No. of<br />
shares<br />
1. Ebito Chemiebeteiligungen AG 8167080 30.63 8167080 30.63<br />
2. <strong>Clariant</strong> International AG 6075000 22.79 6075000 22.79<br />
3. <strong>Clariant</strong> Participations AG 2660000 9.98 2660000 9.98<br />
4. UTI (thru its various schemes) 572000 2.15 566297 2.12<br />
5. Finquest Securities Pvt. Ltd.<br />
(Held under 4 folios)<br />
%<br />
535766 2.01 Nil Nil<br />
6. UTI Master Value Fund 264243 0.99 289071 1.08<br />
8.12 Distribution of shareholdings as at December 31, <strong>2009</strong><br />
No. of equity shares<br />
held<br />
Shareholders<br />
Equity Shares held<br />
Numbers % No. of shares %<br />
1 – 500 28190 91.956 2836121 10.638<br />
501 – 1000 1436 4.684 1069610 4.012<br />
1001 – 2000 575 1.876 833575 3.127<br />
2001 – 3000 157 0.512 394096 1.478<br />
3001 – 4000 83 0.271 293416 1.101<br />
4001 – 5000 69 0.225 320948 1.204<br />
5001 – 10000 84 0.274 598984 2.247<br />
10001 & above 62 0.202 20313995 76.194<br />
Total 30656 100.000 26660745 100.000<br />
8.13 Dematerialisation of shares and liquidity<br />
Names of Depositories for dematerialisation of equity<br />
shares:<br />
Name of the Depository<br />
National Securities Depositories Limited (NSDL)<br />
Central Depository Services (India) Limited (CDSL)<br />
ISIN No.<br />
INE492A01029<br />
INE492A01029<br />
Trading in equity shares of the Company is permitted only in<br />
dematerialised form.<br />
8.14 ADRs/GDRs/Warrants<br />
The Company has not issued any GDRs/ADRs/Warrants or<br />
any other convertible instruments.<br />
8.15 Plant Locations:<br />
(i) The Company’s manufacturing facilities are located at<br />
(ii)<br />
(a)<br />
(b)<br />
(c)<br />
(d)<br />
Balkum Village, Thane-400 608 (Maharashtra)<br />
Kolshet Road, Thane-400 607 (Maharashtra)<br />
113/114, MIDC, A.V.P.O. Dhatav, Roha,<br />
Dist. Raigad-402 116 (Maharashtra)<br />
Kudikadu, P.O., Cuddalore-607 005 (Tamil Nadu)<br />
(e) Singhadivakkam Village, Kanchipuram-631 561<br />
(Tamil Nadu)<br />
The Company’s wholly owned subsidiary company’s<br />
(Chemtreat Composites India Private Limited) plant<br />
is located at Village Savaroli Survey No. 109,<br />
110, 112 Kharpada Road, Tal Khalapur, Khopoli<br />
Dist. Raigad-410 203 (Maharashtra)<br />
9. Additional Information:<br />
9.1 Dividend for the year ended December 31, <strong>2009</strong>:<br />
The final dividend recommended by the Board for the year<br />
will be paid after approval of shareholders at the forthcoming<br />
<strong>Annual</strong> General Meeting to all those shareholders whose<br />
names appear – in respect of shares held in demat form, as<br />
beneficial owner, as per details furnished by the depositories<br />
as at the end of the business on April 12, 2010 and
<strong>Report</strong> on Corporate Governance<br />
29<br />
In respect of shares held in physical form as members in the<br />
register of members of the Company after giving effect to all<br />
valid share transfers lodged with the share transfer agent<br />
on or before April 12, 2010. The Company will dispatch the<br />
dividend warrants on or after April 24, 2010.<br />
9.2 Unpaid / Unclaimed Dividend:<br />
In terms of the amended provisions of Section 205C of the<br />
Companies Act, 1956 the Company is obliged to transfer<br />
dividends which remain unpaid or unclaimed for the period<br />
of seven years from the date of declaration of dividend<br />
to the credit of the Investor Education and Protection<br />
Fund established by the Central Government. Accordingly,<br />
the Company has transferred unpaid/unclaimed dividend<br />
up to the financial year 2001-2002 to the fund and no claim<br />
shall lie against the Company or the fund in respect of<br />
dividends remaining unclaimed or unpaid and transferred to<br />
the Fund.<br />
Members are hereby informed that the seven years period<br />
for payment of the dividend pertaining to financial year<br />
2002-2003 will expire on 24.07.2010 and thereafter the<br />
amount standing to the credit in the said account will be<br />
transferred to the ‘Investor Education and Protection Fund’ of<br />
the Central Government. Members are therefore requested<br />
to encash the dividend at the earliest.<br />
Dates of transfer of unclaimed dividend to the Fund<br />
Financial Year/period<br />
Date of Payment<br />
Date of completion of<br />
seven years<br />
2002-2003 25.07.2003 24.07.2010<br />
2003-2004 30.07.2004 29.07.2011<br />
2004-2005 29.07.2005 28.07.2012<br />
2005-2006 27.07.2006 26.07.2013<br />
April-Dec. 2006 19.04.2007 18.04.2014<br />
2007 17.04.2008 16.04.2015<br />
2008 29.04.<strong>2009</strong> 28.04.2016<br />
<strong>2009</strong> (Interim) 24.07.<strong>2009</strong> 23.07.2016<br />
9.4 Nomination Facility:<br />
A member can nominate a person who shall have rights<br />
to shares and/or amount payable in respect of shares<br />
registered in his name in the event of his death. This facility<br />
is available to the members of the Company. The said<br />
form can be obtained from the Company’s Share transfer<br />
agent or downloaded from the website of the Company<br />
at www.clariant.in<br />
9.5 Consolidation of folios and avoidance of multiple<br />
folios:<br />
Members having multiple folios are requested to consolidate<br />
their folios into single folio and for this purpose send request<br />
along with the original certificates along with a request to<br />
the Share Transfer Agent specifying the folio number under<br />
which they desire to hold the shares.<br />
9.6 Compliance<br />
The Company has complied with all requirements of<br />
regulatory authorities. No penalties/strictures were imposed<br />
on the Company by stock exchanges or SEBI or any statutory<br />
authority on any matter related to capital market during the<br />
last three years.<br />
10. CEO/CFO Certification<br />
The Vice-Chairman & Managing Director and the Director<br />
Finance & Company Secretary have provided annual<br />
certificate on financial reporting and internal controls to<br />
the Board pursuant to clause 49. They have also provided<br />
quarterly certificates on financial results while placing the<br />
financial results before the Board pursuant to Clause 41.<br />
Mumbai, February 19, 2010<br />
On behalf of the Board of Directors<br />
R. A. Shah<br />
Chairman<br />
9.3 Bank Mandate:<br />
Electronic Clearing Services (ECS) is a method of payment of<br />
dividend whereby the amount due to investors can directly<br />
be credited into their bank accounts, without having to<br />
issue paper instruments. It is fast and there is no scope for<br />
loss of dividend warrants in transit and possible fraudulent<br />
encashment.<br />
In case of shares held in physical form the bank details may<br />
be sent to the registrar & share transfer agents. In case of<br />
shares held in demat form, the bank details provided by the<br />
Depository Participant (DP) with whom the demat account<br />
is maintained will be applicable. All previous instructions<br />
given by you to the Company in respect of ECS and bank<br />
details will stand superseded by the ECS details recorded<br />
with your DP.
30 <strong>Clariant</strong> Chemicals (India) Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
Auditors’ Certificate on Corporate Governance<br />
To The Members of <strong>Clariant</strong> Chemicals (India) Limited<br />
We have examined the compliance of conditions of Corporate Governance by <strong>Clariant</strong> Chemicals (India) Limited, for the year ended<br />
December 31, <strong>2009</strong> as stipulated in Clause 49 of the Listing Agreement of the said Company with the Stock Exchange(s).<br />
The compliance of conditions of Corporate Governance is the responsibility of the management. Our examination was limited to procedures<br />
and implementation thereof, adopted by the Company for ensuring the compliance of the conditions of Corporate Governance. It is neither an<br />
audit nor an expression of opinion on the financial statements of the Company.<br />
In our opinion and to the best of our information and according to the explanations given to us and based on the representations made by<br />
the Directors and the Management, we certify that the Company has complied with the conditions of Corporate Governance as stipulated in<br />
the above mentioned Listing Agreement.<br />
We state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency or effectiveness with which<br />
the Management has conducted the affairs of the Company.<br />
For Deloitte Haskins & Sells<br />
Chartered Accountants<br />
Reg. No. 117365W<br />
A. C. Khanna<br />
Partner<br />
Mumbai, 19th February, 2010 Membership No.: 17814
31<br />
Auditors’ <strong>Report</strong><br />
To the Members of <strong>Clariant</strong> Chemicals (India) Limited<br />
1. We have audited the attached Balance Sheet of <strong>Clariant</strong> Chemicals<br />
(India) Limited, as at December 31, <strong>2009</strong> and also the Profit and<br />
Loss Account and the Cash Flow Statement for the year ended<br />
on that date annexed thereto. These financial statements are the<br />
responsibility of the Company’s management. Our responsibility<br />
is to express an opinion on these financial statements based on<br />
our audit.<br />
2. We conducted our audit in accordance with auditing standards<br />
generally accepted in India. Those Standards require that we<br />
plan and perform the audit to obtain reasonable assurance<br />
about whether the financial statements are free of material<br />
misstatement. An audit includes examining, on a test basis,<br />
evidence supporting the amounts and disclosures in the<br />
financial statements. An audit also includes assessing the<br />
accounting principles used and significant estimates made by<br />
the management, as well as evaluating the overall financial<br />
statement presentation. We believe that our audit provides a<br />
reasonable basis for our opinion.<br />
(d)<br />
(e)<br />
(f)<br />
in our opinion, the Balance Sheet, Profit and Loss Account<br />
and Cash Flow Statement dealt with by this report comply<br />
with the Accounting Standards referred to in sub-section<br />
(3C) of Section 211 of the Companies Act, 1956;<br />
on the basis of the written representations received from<br />
the directors, as on December 31, <strong>2009</strong> and taken on<br />
record by the Board of Directors, we report that none<br />
of the directors of the Company is disqualified as on<br />
December 31, <strong>2009</strong> from being appointed as a director,<br />
in terms of clause (g) of sub-section (1) of Section 274 of<br />
the Companies Act, 1956; and<br />
in our opinion and to the best of our information and<br />
according to the explanations given to us, the said<br />
accounts give the information required by the Companies<br />
Act, 1956, in the manner so required and give a true and<br />
fair view in conformity with the accounting principles<br />
generally accepted in India:<br />
3. As required by the Companies (Auditor’s <strong>Report</strong>) Order, 2003 (the<br />
‘Order’) issued by the Central Government of India in terms of<br />
sub-section (4A) of Section 227 of the Companies Act, 1956, we<br />
enclose in the annexure a statement on the matters specified in<br />
paragraphs 4 and 5 of the said Order to the extent applicable to<br />
the Company.<br />
4. Further to our comments in the Annexure referred to in paragraph<br />
3 above, we report that:<br />
(i)<br />
(ii)<br />
(iii)<br />
in the case of the Balance Sheet, of the state of<br />
affairs of the Company as at December 31, <strong>2009</strong>;<br />
in the case of the Profit and Loss Account, of the<br />
profit of the Company for the year ended on that<br />
date; and<br />
in the case of the Cash Flow Statement, of the cash<br />
flows for the year ended on that date.<br />
(a)<br />
(b)<br />
(c)<br />
we have obtained all the information and explanations,<br />
which to the best of our knowledge and belief were<br />
necessary for the purposes of our audit;<br />
in our opinion, proper books of account as required by<br />
law have been kept by the Company, so far as appears<br />
from our examination of the books;<br />
the Balance Sheet, Profit and Loss Account and Cash Flow<br />
Statement dealt with by this report are in agreement with<br />
the books of account;<br />
Mumbai: February 19, 2010<br />
For Deloitte Haskins & Sells<br />
Chartered Accountants<br />
Registration No. 117365W<br />
A. C. Khanna<br />
Partner<br />
Membership No. 17814
32 <strong>Clariant</strong> Chemicals (India) Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
Annexure to the Auditors’ <strong>Report</strong><br />
[Referred to in paragraph 3 of the Auditors’ <strong>Report</strong> of even date to the members of <strong>Clariant</strong> Chemicals (India) Limited<br />
on the financial statements for the year ended December 31, <strong>2009</strong>.]<br />
(i) (a) The Company has maintained proper records showing<br />
full particulars including quantitative details and<br />
situation of fixed assets.<br />
(b)<br />
(c)<br />
The Company has a programme of physical verification<br />
of fixed assets. As per the said programme, certain<br />
assets were physically verified during the year. In our<br />
opinion, the frequency of verification is reasonable<br />
having regard to the size of the Company and the<br />
nature of its assets. According to the information and<br />
explanations given to us, no material discrepancies<br />
were noticed on such verification.<br />
In our opinion, fixed assets disposed off during the<br />
year were not substantial. Therefore, the provisions<br />
of clause 4(i)(c) of the Order are not applicable to<br />
the Company.<br />
(ii) (a) The inventories have been physically verified during<br />
the year by the management except for stocks lying at<br />
third party locations for which confirmations have been<br />
obtained and for goods-in-transit. In our opinion, the<br />
frequency of verification is reasonable.<br />
(b)<br />
(c)<br />
The procedures of physical verification of inventories<br />
followed by the management are reasonable and<br />
adequate in relation to the size of the Company and<br />
the nature of its business.<br />
In our opinion and according to the information and<br />
explanations given to us, the Company is maintaining<br />
proper records of inventory. The discrepancies noticed<br />
on verification between the physical stocks and the<br />
book records were not material and have been properly<br />
dealt with in the books of account.<br />
(iii) (a) As informed, the Company has not granted any loans,<br />
secured or unsecured to Companies, firms or other<br />
parties covered in the register maintained under<br />
Section 301 of the Companies Act, 1956. Accordingly,<br />
sub-clause (b), (c) and (d) of clause 4(iii) of the Order<br />
are not applicable.<br />
(iv)<br />
covered in the register maintained under Section 301<br />
of the Companies Act, 1956. Accordingly, sub-clause (f)<br />
and (g) of clause 4(iii) of the Order are not applicable.<br />
In our opinion and according to the information and explanations<br />
given to us, having regard to the explanations that some of the<br />
items purchased are of a special nature and suitable alternatives<br />
do not exist for obtaining comparable quotations, there are<br />
adequate internal control systems commensurate with the size<br />
of the Company and the nature of its business with regard to<br />
purchases of inventory and fixed assets and with regard to the<br />
sale of goods and services. Further, the basis of our examination<br />
and according to the information and explanations given to us,<br />
we have neither come across nor have we been informed of<br />
any instance of major weaknesses in the aforesaid internal<br />
control systems.<br />
(v) (a) In our opinion and according to the information and<br />
explanations given to us, the particulars of contracts or<br />
arrangements referred to in Section 301 of the Companies<br />
Act, 1956 have been entered in the register required to be<br />
maintained under that Section.<br />
(vi)<br />
(b)<br />
In our opinion and according to the information and<br />
explanations given to us, the transactions made in<br />
pursuance of such contracts and arrangements entered<br />
in the register maintained under Section 301 of the<br />
Companies Act, 1956 have been made at the prices<br />
which are reasonable having regard to the prevailing<br />
market prices at the relevant time except in case of some<br />
transactions where alternate source of supply did not exist<br />
and therefore, no comparison of prices was possible.<br />
In our opinion and according to the information and explanations<br />
given to us, the Company has complied with the provisions of<br />
Sections 58A, 58AA or any other relevant provisions of the<br />
Companies Act, 1956 and the Companies (Acceptance of Deposits)<br />
Rules, 1975 with regard to the deposits accepted from the public.<br />
As informed to us, no order has been passed by the Company Law<br />
Board or National Company Law Tribunal or Reserve Bank of India<br />
or any Court or any other Tribunal.<br />
(b)<br />
According to the information and explanations given<br />
to us, the Company has not taken any loans, secured<br />
or unsecured, from companies, firms or other parties<br />
(vii)<br />
In our opinion, the Company has an internal audit system<br />
commensurate with the size of the Company and nature of its<br />
business.
Annexure to the Auditors’ <strong>Report</strong><br />
33<br />
(viii)<br />
We have broadly reviewed the books of account maintained by the<br />
Company pursuant to the Rules made by the Central Government<br />
for the maintenance of cost records under Section 209(1)(d) of<br />
the Companies Act, 1956 and are of the opinion that prima facie<br />
the prescribed records have been maintained and the prescribed<br />
accounts are in the process of being made up. We have not,<br />
however, made a detailed examination of the records with a view<br />
to determining whether they are accurate or complete.<br />
(ix) (a) According to the records of the Company, Provident Fund,<br />
Investor Education and Protection Fund, Employees’ State<br />
Insurance, Income-tax, Sales-tax, Wealth tax, Service tax,<br />
Custom duty, Excise duty, Cess and other material statutory<br />
dues applicable to it have been generally regularly<br />
deposited during the year with the appropriate authorities.<br />
According to the information and explanations given to<br />
us, no undisputed amounts payable in respect of above<br />
were in arrears, as at December 31, <strong>2009</strong> for a period<br />
of more than six months from the date on which they<br />
became payable.<br />
(b)<br />
Name of<br />
Statute<br />
(Nature of<br />
Dues)<br />
Sales Tax<br />
(Tax/ Penalty/<br />
Interest)<br />
According to the records of the Company, Income-tax,<br />
Sales-tax, Wealth tax, Service tax, Customs duty, Excise<br />
duty and Cess as applicable which have not been deposited<br />
on account of dispute are as follows:<br />
Period to<br />
which the<br />
amount<br />
Relates<br />
1992-93, 2001-02,<br />
2002-03, 2003-04<br />
Commissionarate<br />
Forum where dispute is pending<br />
Appellate<br />
authorities<br />
& Tribunal<br />
High<br />
Court<br />
(Rs. In Lakhs)<br />
Total<br />
Amount<br />
354.25 – – 354.25<br />
1999-00 – 17.88 – 17.88<br />
1996-97,1997-98,<br />
1998-99<br />
– – 2.27 2.27<br />
Total 354.25 17.88 2.27 374.40<br />
The Central<br />
Excise Act<br />
(Tax/ Penalty/<br />
Interest)<br />
1994-97, 2000-<br />
2001, 2004-2005,<br />
2006- 2007<br />
408.64 – – 408.64<br />
1999-00, 2000-04 –- 33.75 – 33.75<br />
Total 408.64 33.75 – 442.39<br />
Service<br />
Tax<br />
2005-06 0.52 – – 0.52<br />
2004-05 – 5.12 – 5.12<br />
Total 0.52 5.12 – 5.64<br />
Income<br />
Tax (Tax/<br />
Interest)<br />
A.Y. 1987-88,<br />
1992-93 , 1994-95,<br />
2000-01, 2001-02,<br />
2003-04,2004-05,<br />
2005-06 & 2006-07<br />
A.Y. 1995-96,<br />
2000-01, 2003-04<br />
602.23 – – 602.23<br />
– 248.15 – 248.15<br />
Total 602.23 248.15 – 850.38<br />
(x)<br />
The Company does not have any accumulated losses at the end<br />
of the financial year and has not incurred cash losses during<br />
(xi)<br />
(xii)<br />
(xiii)<br />
(xiv)<br />
(xv)<br />
(xvi)<br />
the financial year covered by our audit and in the immediately<br />
preceding financial year.<br />
In our opinion and according to the information and explanations<br />
given to us, the Company has not defaulted in repayment of dues<br />
to financial institution, banks or debenture holders.<br />
Based on our examination of the records and the information and<br />
explanations given to us, the Company has not granted any loans<br />
and advances on the basis of security by way of pledge of shares,<br />
debentures and other securities.<br />
In our opinion, the Company is not a chit fund or a nidhi/ mutual<br />
benefit fund/ society. Therefore, the provisions of clause 4(xiii) of<br />
the Order are not applicable to the Company.<br />
In our opinion, the Company is not dealing in or trading in shares,<br />
securities, debentures and other investments. Accordingly, the<br />
provisions of clause 4(xiv) of the Order are not applicable to<br />
the Company.<br />
In our opinion and according to the information and explanations<br />
given to us, the Company has not given any guarantees for loans<br />
taken by others from banks or financial institutions.<br />
In our opinion and according to the information and explanations<br />
given to us, no term loans were acquired during the reporting<br />
period by the Company.<br />
(xvii) According to the information and explanations given to us and on<br />
an overall examination of the balance sheet of the Company, we<br />
report that no funds raised on short-term basis have been used<br />
for long-term investment.<br />
(xviii) According to the information and explanations given to us, the<br />
Company has not made any preferential allotment of shares to<br />
parties and companies covered in the register maintained under<br />
Section 301 of the Companies Act, 1956.<br />
(xix)<br />
(xx)<br />
(xxi)<br />
The Company has not issued any secured debentures. Therefore<br />
the provisions of clause 4(xix) of the Order are not applicable to<br />
the Company.<br />
The Company has not raised any money by way of public issue<br />
during the year. Therefore, the provisions of clause 4(xx) of the<br />
Order are not applicable to the Company.<br />
According to the information and explanations given to us, no<br />
fraud on or by the Company has been noticed or reported during<br />
the course of our audit.<br />
Mumbai: February 19, 2010<br />
For Deloitte Haskins & Sells<br />
Chartered Accountants<br />
Registration No. 117365W<br />
A. C. Khanna<br />
Partner<br />
Membership No. 17814
34 <strong>Clariant</strong> Chemicals (India) Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
Balance Sheet<br />
as at 31st December, <strong>2009</strong><br />
Schedule<br />
31-12-09<br />
Rs. Lakhs<br />
31-12-08<br />
Rs. Lakhs<br />
SOURCES OF FUNDS<br />
Shareholders’ funds<br />
Share capital 1 2666.07 2666.07<br />
Reserves and surplus 2 32113.18 29097.55<br />
34779.25 31763.62<br />
Loan funds<br />
Unsecured loans 3 204.78 309.07<br />
204.78 309.07<br />
Deferred tax liability – Net (See note 6, Schedule 17) — 254.94<br />
34984.03 32327.63<br />
APPLICATION OF FUNDS<br />
Fixed assets 4<br />
Gross block 34975.65 38797.09<br />
Less : Accumulated depreciation and impairment 21085.35 23390.54<br />
Net block 13890.30 15406.55<br />
Capital work-in-progress and advances, etc. 590.72 1053.83<br />
14481.02 16460.38<br />
Fixed assets held for disposal (See note 26, Schedule 17) 792.34 —<br />
Investments 5 12449.95 5784.47<br />
Deferred tax asset – Net (See note 6, Schedule 17) 275.72 —<br />
Current assets, loans and advances<br />
Inventories 6 7665.03 10543.98<br />
Sundry debtors 7 14459.63 13210.41<br />
Cash and bank balances 8 1696.62 842.31<br />
Loans and advances 9 6320.49 6397.96<br />
30141.77 30994.66<br />
Less : Current liabilities and provisions<br />
Liabilities 10 16572.90 12844.86<br />
Provisions 11 6583.87 8067.02<br />
23156.77 20911.88<br />
Net current assets 6985.00 10082.78<br />
34984.03 32327.63<br />
Notes on balance sheet and profit and loss account 17<br />
Per our report attached<br />
For Deloitte Haskins & Sells<br />
Chartered Accountants<br />
A. C. Khanna<br />
Partner<br />
Mumbai, 19th February, 2010<br />
For and on behalf of the Board<br />
R. A. Shah Chairman<br />
P. Palm Vice-Chairman & Managing Director<br />
Diwan A. Nanda Director<br />
B. L. Gaggar Director Finance & Company Secretary<br />
Mumbai, 19th February, 2010
35<br />
Profit and Loss Account<br />
for the year ended 31st December, <strong>2009</strong><br />
<strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
Schedule<br />
INCOME<br />
Sales – Gross 97322.24 100145.34<br />
Less : Excise duty 5188.11 8505.87<br />
Sales – Net 92134.13 91639.47<br />
Other income 12 2630.82 2533.68<br />
94764.95 94173.15<br />
EXPENDITURE<br />
Cost of materials 13 54523.49 58150.05<br />
Personnel cost 14 6158.71 7229.91<br />
Interest (Net) 15 16.67 (18.29)<br />
Depreciation/Amortisation 4 1896.35 2251.60<br />
Impairment of fixed assets 4 136.98 728.62<br />
Other expenditure 16 14178.36 15842.89<br />
76910.56 84184.78<br />
Less : Service charges recovered 906.74 788.23<br />
76003.82 83396.55<br />
PROFIT BEFORE EXCEPTIONAL ITEMS AND TAXATION 18761.13 10776.60<br />
Exceptional items (See note 23, Schedule 17) 2450.46 48.00<br />
PROFIT AFTER EXCEPTIONAL ITEMS AND BEFORE TAXATION 16310.67 10728.60<br />
Provision for taxation<br />
Current tax 5958.00 3792.00<br />
Deferred tax (530.66) (178.29)<br />
Fringe benefit tax 39.00 118.50<br />
(Excess)/Short provision for taxation in respect of earlier years 30.77 248.09<br />
PROFIT AFTER TAXATION 10813.56 6748.30<br />
Balance brought forward from previous year 1097.40 950.36<br />
AVAILABLE FOR APPROPRIATION 11910.96 7698.66<br />
APPROPRIATED AS FOLLOWS<br />
General reserve 1081.36 674.83<br />
Interim dividend 2666.07 —<br />
Proposed dividend (Final) 3999.11 5065.54<br />
Corporate tax on dividend (Interim & Final) 1132.75 860.89<br />
Balance carried to the balance sheet 3031.67 1097.40<br />
11910.96 7698.66<br />
Notes on balance sheet and profit and loss account 17<br />
Basic and Diluted earnings per share (Rupees) (See note 15, Schedule 17) 40.56 25.31<br />
Face value per share (Rupees) 10.00 10.00<br />
Per our report attached to the Balance Sheet<br />
For Deloitte Haskins & Sells<br />
Chartered Accountants<br />
A. C. Khanna<br />
Partner<br />
Mumbai, 19th February, 2010<br />
For and on behalf of the Board<br />
R. A. Shah Chairman<br />
P. Palm Vice-Chairman & Managing Director<br />
Diwan A. Nanda Director<br />
B. L. Gaggar Director Finance & Company Secretary<br />
Mumbai, 19th February, 2010
36 <strong>Clariant</strong> Chemicals (India) Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
Cash Flow Statement<br />
for the year ended 31st December, <strong>2009</strong><br />
A. CASH FLOW FROM OPERATING ACTIVITIES :<br />
<strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
Net Profit after exceptional items and before taxation 16310.67 10728.60<br />
Adjustments for :<br />
Depreciation/Amortisation 1896.35 2251.60<br />
Impairment of fixed assets 136.98 728.62<br />
Unrealised foreign exchange (gain)/loss (Net) (32.89) 59.96<br />
Interest income (83.20) (171.67)<br />
Dividend income (407.90) (171.56)<br />
Loss/(profit) on sale of assets (Net) (80.31) (20.66)<br />
Loss/(profit) on sale of investments (Net) (0.21) (0.29)<br />
Provision for doubtful debts/advances (Net) 29.39 200.11<br />
Provision for leave encashment (126.69) 4.52<br />
Provision for ex-gratia gratuity (15.21) 4.24<br />
Provision for gratuity (186.30) 267.80<br />
Interest expenses 99.87 153.38<br />
Assets written-off 100.69 390.63<br />
Operating profit before working capital changes 17641.24 14425.28<br />
Adjustments for :<br />
Trade and other receivables (1050.90) 653.07<br />
Inventories 2878.95 727.06<br />
Trade, other payables and provisions 3693.84 (4447.67)<br />
Cash generated from operations 23163.13 11357.74<br />
Direct taxes paid – (Net of refunds) (6055.45) (3288.52)<br />
Net cash from operating activities 17107.68 8069.22<br />
B. CASH FLOW FROM INVESTING ACTIVITIES :<br />
Purchase of fixed assets (1005.00) (2669.18)<br />
Sale of fixed assets 138.31 49.71<br />
Purchase of investments (95164.44) (42571.83)<br />
Sale of investments 88499.17 39730.92<br />
Loans given to subsidiary (31.00) (75.00)<br />
Loans repaid by subsidiary 1.00 —<br />
Interest received 83.20 171.67<br />
Dividend received 407.90 171.56<br />
Net Cash used in investing activities (7070.86) (5192.15)
Cash Flow Statement<br />
37<br />
C. CASH FLOW FROM FINANCING ACTIVITIES :<br />
<strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
Repayment of borrowings (104.29) (98.09)<br />
Interest paid (93.33) (147.17)<br />
Dividend/dividend tax paid (8984.89) (3109.75)<br />
Net Cash used in financing activities (9182.51) (3355.01)<br />
NET INCREASE IN CASH AND CASH EQUIVALENTS (A+B+C) 854.31 (477.94)<br />
CASH AND CASH EQUIVALENTS AS AT BEGINNING OF THE YEAR 842.31 1320.25<br />
CASH AND CASH EQUIVALENTS AS AT THE END OF THE YEAR (See note 3) (Refer Schedule 8) 1696.62 842.31<br />
Notes:<br />
1. The Cash flow has been prepared under the “Indirect Method” as set out in Accounting Standard – 3 on Cash flow statement notified by the<br />
Companies (Accounting Standards) Rules, 2006.<br />
2. Direct taxes paid are treated as arising from operating activities and are not bifurcated between investing and financing activities.<br />
3. Cash and cash equivalents at the end of the year include current account balances with banks of Rs. 221.71 lakhs (Previous Year : Rs. 161.63 lakhs)<br />
which are restricted in use on account of unclaimed dividend/fixed deposit/interest on fixed deposit.<br />
4. Figures for the previous year have been regrouped wherever necessary to conform to the current year’s classification.<br />
Per our report attached to the Balance Sheet<br />
For Deloitte Haskins & Sells<br />
Chartered Accountants<br />
A. C. Khanna<br />
Partner<br />
Mumbai, 19th February, 2010<br />
For and on behalf of the Board<br />
R. A. Shah Chairman<br />
P. Palm Vice-Chairman & Managing Director<br />
Diwan A. Nanda Director<br />
B. L. Gaggar Director Finance & Company Secretary<br />
Mumbai, 19th February, 2010
38 <strong>Clariant</strong> Chemicals (India) Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
Schedules<br />
forming part of the Balance Sheet<br />
SCHEDULE 1 : SHARE CAPITAL 31-12-09<br />
Rs. Lakhs<br />
31-12-08<br />
Rs. Lakhs<br />
Authorised<br />
30000000 equity shares of Rs. 10/- each 3000.00 3000.00<br />
Issued and subscribed<br />
26660745 equity shares of Rs. 10/- each fully paid 2666.07 2666.07<br />
Notes:<br />
Of the above :<br />
(a) 15010745 equity shares issued as fully paid up pursuant to a contract for a consideration other than cash.<br />
(b) 8167080 equity shares are held by EBITO Chemiebeteiligungen AG.<br />
6075000 equity shares are held by <strong>Clariant</strong> International AG.<br />
2660000 equity shares are held by <strong>Clariant</strong> Participations AG.<br />
The ultimate holding company being <strong>Clariant</strong> AG, Switzerland.<br />
(c) 6690610 equity shares were allotted as fully paid up bonus shares by capitalisation of Rs. 669.06 lakhs from general reserve.<br />
SCHEDULE 2 : RESERVES AND SURPLUS 31-12-09<br />
Rs. Lakhs<br />
Capital reserve<br />
31-12-08<br />
Rs. Lakhs<br />
As per last Balance sheet 730.11 730.11<br />
Capital redemption reserve<br />
As per last Balance sheet 137.50 137.50<br />
Securities premium account<br />
As per last Balance sheet 3545.65 3545.65<br />
Investment allowance reserve<br />
As per last Balance sheet 20.00 20.00<br />
Less : Transfer to general reserve 20.00 —<br />
— 20.00<br />
General reserve<br />
As per last Balance sheet 23566.89 22892.06<br />
Add : Transfer from Investment allowance reserve 20.00 —<br />
Transfer from Profit and loss account 1081.36 674.83<br />
24668.25 23566.89<br />
Profit and loss account 3031.67 1097.40<br />
32113.18 29097.55<br />
SCHEDULE 3 : UNSECURED LOANS 31-12-09<br />
Rs. Lakhs<br />
From others:<br />
31-12-08<br />
Rs. Lakhs<br />
Interest-free sales tax deferral scheme granted by State Industries Promotion Corporation<br />
of Tamil Nadu Limited (Repayable within one year Rs. 99.50 lakhs, Previous Year: Rs. 104.29 lakhs) 204.78 309.07<br />
204.78 309.07
Schedules forming part of the Balance Sheet<br />
39<br />
SCHEDULE 4 : FIXED ASSETS<br />
As at<br />
31-12-08<br />
GROSS BLOCK DEPRECIATION / AMORTISATION / IMPAIRMENT NET BLOCK<br />
Additions/<br />
Adjustments<br />
Deductions/<br />
Adjustments<br />
As at<br />
31-12-09<br />
As at<br />
31-12-08<br />
Deductions/<br />
Adjustments<br />
For the<br />
year<br />
Impairment<br />
(See note 2)<br />
As at<br />
31-12-09<br />
As at<br />
31-12-09<br />
Rs. Lakhs<br />
As at<br />
31-12-08<br />
Tangible Assets<br />
Land freehold 145.02 — — 145.02 — — — — — 145.02 145.02<br />
Land leasehold 14.88 — — 14.88 4.50 — 0.16 — 4.66 10.22 10.38<br />
Buildings 6771.07 299.06 4.91 7065.22 2313.36 1.77 171.48 136.98 2620.05 4445.17 4457.71<br />
Plant, machinery, equipment etc. 28909.15 1068.26 5013.19 24964.22 18878.89 4073.89 1550.35 — 16355.35 8608.87 10030.26<br />
Furniture, fixtures and office<br />
appliances 2260.06 88.48 148.71 2199.83 1627.14 140.79 137.20 — 1623.55 576.28 632.92<br />
Vehicles 696.91 12.31 122.74 586.48 566.65 122.07 37.16 — 481.74 104.74 130.26<br />
Total 38797.09 1468.11 5289.55 34975.65 23390.54 4338.52 1896.35 136.98 21085.35 13890.30<br />
Previous year 36413.30 3398.81 1015.02 38797.09 21005.66 595.34 2251.60 728.62 23390.54 15406.55<br />
Capital work-in-progress 550.23 1030.37<br />
Advances against capital orders 40.49 23.46<br />
590.72 1053.83<br />
14481.02 16460.38<br />
Notes:<br />
1. Buildings include Rs. 0.12 lakh (Previous Year : Rs. 0.12 lakh) being the cost of shares and bonds in co-operative housing societies.<br />
2. In accordance with the provisions of the Accounting Standard – 28 on Impairment of Assets notified by the Companies (Accounting Standards) Rules 2006, the Company has identified<br />
certain fixed assets that were impaired mainly on account of economic performance and viability of such assets which does not have any value in use. Accordingly during current year an<br />
impairment loss of Rs. 136.98 lakhs in respect of Dyes and Specialty Chemicals segment (Rs. 12.47 lakhs) and Intermediates and Colours segment (Rs. 124.51 lakhs) has been recognised<br />
in the profit and loss account. (Previous Year Rs. 728.62 lakhs in respect of Intermediates and Colours segment)<br />
SCHEDULE 5 : INVESTMENTS (AT COST) (Contd.) 31-12-09<br />
Rs. Lakhs<br />
31-12-08<br />
Rs. Lakhs<br />
Non Trade – Unquoted<br />
Long Term<br />
In Subsidiary Company<br />
500000 (Previous Year: 500000) fully paid equity shares of Rs. 10/- each<br />
in Chemtreat Composites India Private Limited 325.00 325.00<br />
Total Long Term 325.00 325.00<br />
Current<br />
In fully paid units of Rs. 10/- each<br />
9825217 (Previous Year : Nil) Birla Sun Life Saving Fund – Daily Dividend 983.19 —<br />
8883589 (Previous Year : Nil) HDFC Treasury Advantage Fund – Whole Sale Fund – Dividend-Daily 891.16 —<br />
4742864 (Previous Year : Nil) HDFC F R I F – STP – Whole Sale Fund – Dividend-Daily 478.12 —<br />
9776175 (Previous Year : Nil) DWS Ultra Short Term Fund – Dividend-Daily 979.37 —<br />
9019717 (Previous Year : Nil) DWS Cash Opportunity Fund – Dividend-Daily 904.16 —<br />
9695701 (Previous Year : Nil) JM Money Manager Fund – Super Plus Plan – Dividend-Daily 970.08 —<br />
4038543 (Previous Year : Nil) IDFC Money Manager Fund – Dividend-Daily 403.91 —<br />
9471776 (Previous Year : Nil) LIC MF Income Plus Fund – Dividend-Daily 947.18 —<br />
9197118 (Previous Year : Nil) LIC MF Saving Plus Fund – Dividend-Daily 919.71 —<br />
9847865 (Previous Year : Nil) LIC MF Floater Fund – Dividend-Daily 984.80 —
40 <strong>Clariant</strong> Chemicals (India) Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
SCHEDULE 5 : INVESTMENTS (AT COST) (Contd.) 31-12-09<br />
Rs. Lakhs<br />
31-12-08<br />
Rs. Lakhs<br />
Nil (Previous Year : 9346248) Birla Sun Life Short Term Fund – Institutional – Daily Dividend — 935.14<br />
Nil (Previous Year : 7999333) Fidelity Cash Fund – Institutional – Daily Dividend — 800.13<br />
Nil (Previous Year : 7754587) HDFC Liquid Fund Premium Plan – Dividend-Daily — 950.70<br />
Nil (Previous Year : 5571131) Reliance Medium Term Fund – Daily Dividend — 952.41<br />
In fully paid units of Rs. 100/- each<br />
863340 (Previous Year : Nil) ICICI Prudential Flexible Income Premium Plan Fund – Daily Dividend 912.85 —<br />
957923 (Previous Year : Nil) ICICI Prudential Floating Rate Plan D – Daily Dividiend 958.12 —<br />
In fully paid units of Rs. 1000/- each<br />
91249 (Previous Year : Nil) Reliance Money Manager Fund – Institutional Plan – Daily Dividend 913.53 —<br />
65341 (Previous Year : 89206) DSP BlackRock Floating Rate Fund – Institutional Plan – Daily Dividend 653.77 892.06<br />
22483 (Previous Year : Nil) UTI Floating Rate Fund STP – Daily Dividend 225.00 —<br />
Nil (Previous Year : 83357) TATA Liquid Super High Investment Fund – Daily Dividend — 929.03<br />
Total Current 12124.95 5459.47<br />
Total Investments – Unquoted 12449.95 5784.47<br />
Following are the Investments which have been purchased and sold during the year :<br />
January to December <strong>2009</strong><br />
Nos. Rs. Lakhs<br />
Non trade Current – unquoted<br />
In fully paid units of Rs. 10/- each<br />
Reliance Medium Term Fund DDR 9798769 1675.15<br />
Reliance Liquid Fund Treasury Plan I.P. DDR 23021439 3519.33<br />
Kotak Liquid Fund : Institutional Premium Plan DDR 26435819 3232.60<br />
Kotak Floater Long Term – Daily Dividend 19001414 1915.30<br />
Kotak Flexi Debt Fund – Daily Dividend 9537367 958.27<br />
Birla Sun Life Saving Fund Inst DDR 11422101 1142.99<br />
Birla Sun Life Short Term Fund DDR 166799 16.69<br />
Birla Sun Life Cash Plus Inst DDR 30607458 3066.71<br />
JM High Liquidiy Fund – Super Inst Plan Daily Dividend 32701851 3275.58<br />
JM Money Manager Fund – Super Plus Plan Daily Dividend 24681333 2469.44<br />
TATA Floater Fund – Daily Dividend 22027430 2210.58<br />
DWS Insta Cash Plus Fund – Institutional Plan DDR 30962987 3109.02<br />
DWS Ultra Short Term Fund – Institutional Plan DDR 12471955 1249.16<br />
ICICI Prudential MF Plan Super Institutional Plan Daily Dividend 38359058 3836.40<br />
ICICI Prudential MF Flexible Income Plan – Premium Daily Dividend 17761278 1877.99<br />
ICICI Prudential MF Floating Rate Fund Daily Dividend 9896815 989.89
Schedules forming part of the Balance Sheet<br />
41<br />
Following are the Investments which have been purchased and sold during the year : (Contd.)<br />
January to December <strong>2009</strong><br />
Nos. Rs. Lakhs<br />
HDFC Cash Mangement Fund – Saving Plus – DDR 19417490 2065.32<br />
HDFC Cash Mangement Fund – Treasury Advantage Plan – Wholesale DDR 24687274 2476.50<br />
HDFC F R I F STF – Wholesale DDR 4959875 500.00<br />
HDFC Liquid Fund Premium Plan DDR 31033067 3804.59<br />
Canara Robeco Liquid Fund – I.P. – Daily Dividend 14698674 1475.89<br />
Canara Robeco Treasury Advantage Fund – I.P. – Daily Dividend 3870373 480.20<br />
Fidelity Cash Fund – I.P. – Daily Dividend 10815492 1081.82<br />
Fidelity Ultra Short Term Debt Fund – I.P. – Daily Dividend 19065377 1906.82<br />
IDFC Money Treasury Fund – I.P.C. – Daily Dividend 13954500 1395.66<br />
IDFC Money Treasury Fund – I.P.B. – Daily Dividend 29175520 2938.06<br />
IDFC Cash Fund – Super I.P.C – Daily Dividend 8998490 900.07<br />
IDFC Cash Fund – I.P. – Daily Dividend 37097892 3925.55<br />
SBI – SHF – Ultra Short Term Fund – I.P. – Daily Dividend 17816624 1782.55<br />
SBI – Magnum Insta Cash Fund – Daily Dividend 15543795 2603.63<br />
LIC Liquid Fund – DDR 40459389 4442.48<br />
LIC MF Income Plus Fund – DDR 8641648 864.16<br />
LIC MF Floater Rate S T Fund – DDR 16254850 1625.49<br />
FORTIS Money Plus Inst Plan Fund – DDR 10382401 1038.56<br />
FORTIS Overnight Fund – DDR 10287689 1029.08<br />
In fully paid units of Rs. 100 /- each<br />
ICICI Prudential MF Liquid Plan Super Institutional Plan – Daily Dividend 955874 956.08<br />
In fully paid units of Rs. 1000 /- each<br />
TATA Treasury Manager Fund Ship – Daily Dividend 90536 914.70<br />
TATA Liquidity Management Ship Fund – Daily Dividend 182296 2031.73<br />
DSP BlackRock Floating Rate Fund – I.P. – Daily Dividend 151974 1520.55<br />
DSP BlackRock Cash Manager Fund – I.P. – Daily Dividend 214595 2146.17<br />
UTI Treasury Advantage Fund – I.P. – Daily Dividend 169324 1693.44<br />
UTI Liquid Cash Plan – I.P. – Daily Dividend 234959 2395.29<br />
UTI Floating Rate Fund STP DDR 49961 500.00
42 <strong>Clariant</strong> Chemicals (India) Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
SCHEDULE 6 : INVENTORIES 31-12-09<br />
Rs. Lakhs<br />
31-12-08<br />
Rs. Lakhs<br />
At lower of cost and net realisable value (As certified by the Management)<br />
Stores and spare parts 187.66 241.35<br />
Raw materials 2114.96 3281.75<br />
Packing materials 104.13 98.56<br />
Finished goods 4422.91 5718.63<br />
Work-in-progress 835.37 1203.69<br />
7665.03 10543.98<br />
SCHEDULE 7 : SUNDRY DEBTORS 31-12-09<br />
Rs. Lakhs<br />
31-12-08<br />
Rs. Lakhs<br />
Secured (Considered good)<br />
Over six months 5.68 9.02<br />
Other debts 1570.88 1349.06<br />
1576.56 1358.08<br />
Unsecured (Considered good, unless otherwise stated)<br />
Over six months (Including doubtful debts Rs. 246.31 lakhs; Previous Year : Rs. 280.89 lakhs) 328.62 396.73<br />
Other debts 12800.76 11736.49<br />
13129.38 12133.22<br />
Less : Provision for doubtful debts 246.31 280.89<br />
14459.63 13210.41<br />
SCHEDULE 8 : CASH AND BANK BALANCES 31-12-09<br />
Rs. Lakhs<br />
31-12-08<br />
Rs. Lakhs<br />
Cash on hand 4.18 6.63<br />
Cheques on hand 49.27 82.05<br />
With scheduled banks:<br />
On current accounts 1010.83 582.13<br />
On fixed deposit accounts 632.34 171.50<br />
1643.17 753.63<br />
1696.62 842.31
Schedules forming part of the Balance Sheet<br />
43<br />
SCHEDULE 9 : LOANS AND ADVANCES 31-12-09<br />
Rs. Lakhs<br />
31-12-08<br />
Rs. Lakhs<br />
(Unsecured – Considered good, unless otherwise stated)<br />
Advances and loans to the subsidiary (See note 25, Schedule 17) 688.35 709.47<br />
Advances recoverable in cash or in kind or for value to be received 3517.98 3672.17<br />
Less : Provision for doubtful advances 63.97 —<br />
3454.01 3672.17<br />
VAT set off admissible 99.67 52.51<br />
Advance payment of Income tax (Net of provision for taxation) 1768.95 1648.55<br />
Balances with customs and excise on current account 309.51 315.26<br />
6320.49 6397.96<br />
SCHEDULE 10 : CURRENT LIABILITIES 31-12-09<br />
Rs. Lakhs<br />
Sundry creditors :<br />
31-12-08<br />
Rs. Lakhs<br />
Due to micro enterprises and small enterprises (See Note 7, Schedule 17) 361.14 82.25<br />
Due to others 14127.02 11157.13<br />
14488.16 11239.38<br />
Deposits 1863.03 1443.85<br />
Unpaid dividends* 221.61 160.90<br />
Unclaimed fixed deposits* 0.06 0.15<br />
Unpaid interest on matured fixed deposits* 0.04 0.58<br />
16572.90 12844.86<br />
* There is no amount due and outstanding to be credited to Investor Education and Protection Fund<br />
SCHEDULE 11 : PROVISIONS 31-12-09<br />
Rs. Lakhs<br />
31-12-08<br />
Rs. Lakhs<br />
Employee benefits:<br />
Leave encashment 365.02 491.71<br />
Gratuity 200.73 387.03<br />
Ex-gratia gratuity 69.21 84.42<br />
Others:<br />
Provision for taxation (Net of advance payment of Income tax) 1270.15 1177.43<br />
Proposed dividend (Final) 3999.11 5065.54<br />
Corporate tax on proposed dividend (Final) 679.65 860.89<br />
6583.87 8067.02
44 <strong>Clariant</strong> Chemicals (India) Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
Schedules<br />
forming part of the Profit and Loss Account<br />
SCHEDULE 12 : OTHER INCOME <strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
Dividend on current non-trade investments 407.90 171.56<br />
Export incentives 420.13 482.72<br />
Profit on sale of fixed assets (Net) 80.31 20.66<br />
Cash discounts 39.40 36.15<br />
Rental income 398.25 364.66<br />
Indenting commission 589.29 634.52<br />
Profit on sale of current investments (Net) 0.21 0.29<br />
Miscellaneous 695.33 823.12<br />
2630.82 2533.68<br />
SCHEDULE 13 : COST OF MATERIALS <strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
Raw materials consumed 38450.19 42048.52<br />
Packing materials consumed 2275.54 2204.63<br />
Purchases of finished goods 12133.72 13003.39<br />
(Increase)/Decrease in stocks of finished goods and work-in-progress :<br />
Opening stock<br />
Finished goods 5718.63 6625.64<br />
Work-in-progress 1203.69 1190.19<br />
6922.32 7815.83<br />
Less : Closing stock<br />
Finished goods 4422.91 5718.63<br />
Work-in-progress 835.37 1203.69<br />
5258.28 6922.32<br />
1664.04 893.51<br />
54523.49 58150.05<br />
SCHEDULE 14 : PERSONNEL COST <strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
Salaries, wages, bonus, etc. 4677.67 5256.71<br />
Contribution/Provision for provident fund, superannuation scheme, gratuity fund, etc. 551.95 1028.20<br />
Welfare expenses 929.09 945.00<br />
6158.71 7229.91
Schedules forming part of the Profit & Loss Account<br />
45<br />
SCHEDULE 15 : INTEREST (NET) <strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
Interest Paid<br />
Others 99.87 153.38<br />
99.87 153.38<br />
Less : Interest received (Gross) :<br />
Others (Tax deducted at source Rs. 12.69 Lakhs; Previous Year : Rs. 7.71 Lakhs) 83.20 171.67<br />
83.20 171.67<br />
16.67 (18.29)<br />
SCHEDULE 16 : OTHER EXPENDITURE <strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
Stores and spare parts etc. consumed 605.63 597.94<br />
Repairs and maintenance:<br />
Plant and machinery 707.88 886.37<br />
Buildings 218.64 216.51<br />
Others 153.33 176.59<br />
Power and fuel 4574.37 4464.92<br />
Rent (including lease payments) (See note 16, Schedule 17) 555.90 582.10<br />
Rates and taxes (including water charges) 516.03 658.00<br />
Insurance 69.27 109.83<br />
Clearing, forwarding and transport 1309.07 1490.65<br />
Travelling and conveyance 873.15 962.82<br />
Commission 175.82 250.64<br />
Cash discount 11.76 22.37<br />
Other discounts on sales 684.65 1324.79<br />
Assets written-off 100.69 390.63<br />
Provision for doubtful debts/advances (Net) 29.39 200.11<br />
Excise duty (324.39) (376.11)<br />
Exchange loss (Net) 162.28 172.63<br />
Miscellaneous (See note 18, Schedule 17) 3754.89 3712.10<br />
14178.36 15842.89
46 <strong>Clariant</strong> Chemicals (India) Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
Notes<br />
SCHEDULE 17 : Notes on the Balance Sheet and Profit and Loss Account for the year ended 31st December, <strong>2009</strong><br />
1. Significant Accounting Policies<br />
The financial statements are prepared at historical cost on the accrual basis of accounting and in accordance with the standards on accounting<br />
notified by the Companies (Accounting Standards) Rules, 2006 and referred to in Section 211(3C) of the Companies Act, 1956.<br />
The significant accounting policies are as follows :<br />
I. Revenue Recognition<br />
II.<br />
III.<br />
IV.<br />
The Company recognises sale of goods on transfer of significant risks and rewards of ownership of the goods to the buyer. Sales are<br />
net of excise duty, sales tax and trade discounts, wherever applicable.<br />
Dividend income on investments is accounted for when the right to receive the payment is established.<br />
Excise Duty<br />
Excise duty payable on products is accounted for at the time of despatch of goods from the factories but is accrued for stocks held at<br />
the year end.<br />
Excise Duty related to the difference between the closing stock and opening stock of finished goods has been recognised separately in<br />
the profit and loss account under schedule of ‘Other Expenditure’.<br />
Research and Development<br />
Revenue expenditure on research and development is written off in the profit and loss account in the year in which it is incurred. Capital<br />
expenditure on research and development is treated in the same way as expenditure on fixed assets.<br />
Employee Benefits<br />
(a)<br />
Short term employee benefit obligations are estimated and provided for.<br />
(b) Post employment benefits and other long term employee benefits :<br />
Defined contribution plans :<br />
Company’s contribution to provident fund, superannuation fund, employee state insurance and other funds are determined under<br />
the relevant schemes and/or statute and charged to revenue.<br />
Defined benefit plans and compensated absences :<br />
Company’s liability towards gratuity, ex-gratia gratuity and compensated absences are actuarially determined at each balance<br />
sheet date using the projected unit credit method. Actuarial gains and losses are recognised in revenue.<br />
V. Voluntary Retirement Scheme<br />
VI.<br />
Expenditure incurred on voluntary retirement scheme is charged to revenue in the year in which it is incurred.<br />
Fixed Assets and Depreciation/Amortisation<br />
(a)<br />
(b)<br />
(c)<br />
(d)<br />
All fixed assets are stated at cost less depreciation, wherever applicable. Cost comprises the purchase price and any other<br />
attributable cost of bringing the asset to its working condition for its intended use. Borrowing cost relating to funds borrowed<br />
for acquisition of qualifying assets for the year upto the date the assets are put to use is included in cost.<br />
The cost of leasehold land is amortised over the period of the lease.<br />
Intangible assets are being amortised equally over a period of three years.<br />
Depreciation has been calculated on the straight line method at the rates and in the manner specified in Schedule XIV of the<br />
Companies Act, 1956 except for :<br />
(i) certain items of furniture, fixture, air conditioners, plant, machinery and equipment on which a depreciation rate of 20%<br />
on straight line method is applied,
Notes<br />
47<br />
VII.<br />
VIII.<br />
IX.<br />
(e)<br />
(ii)<br />
(iii)<br />
electronic data processing (EDP) hardware such as servers on which a depreciation rate of 20% and for other EDP<br />
equipments including personal computers and printers on which depreciation rate of 25% on straight line method is applied,<br />
Motor Cars on which depreciation rate of 25% on straight line method is applied.<br />
Fixed Assets held for disposal are stated at lower of net book value and net realisable value.<br />
Impairment of Assets<br />
The carrying amounts of assets are reviewed at each Balance Sheet date if there is any indication of impairment based on<br />
internal/external factors. An impairment loss is recognised wherever the carrying amount of an asset exceeds its estimated recoverable<br />
amount. The recoverable amount is greater of the asset’s net selling price and value in use. In assessing the value in use, the estimated<br />
future cash flows are discounted to the present value using the weighted average cost of capital. Previously recognised impairment loss<br />
is further provided or reversed depending on changes in circumstances.<br />
Inventories<br />
Inventories are valued at the lower of cost and estimated net realisable value after providing for obsolescence. The cost of inventories<br />
is generally arrived at on the following basis :<br />
Raw materials, packing materials, trading items and stores and spares – Weighted average cost<br />
Finished goods and work-in-progress – Absorption costing at works cost<br />
Sundry Debtors/Loans and Advances<br />
Sundry debtors and loans and advances are stated after making adequate provision for doubtful debts/advances.<br />
X. Investments<br />
XI.<br />
XII.<br />
XIII.<br />
XIV.<br />
Long term investments are stated at cost less provision for diminution in value, other than temporary. Current investments are stated<br />
at the lower of cost and fair value. Dividends are accounted for when the right to receive the dividend payment is established.<br />
Leases<br />
Leases where the lessor effectively retains substantially all the risks and benefits of ownership of the leased assets are classified as<br />
operating leases. Operating lease payments are recognised as an expense in the Profit and Loss Account on a straight-line basis over<br />
the lease term.<br />
Foreign Currency Translations<br />
(a)<br />
(b)<br />
(c)<br />
Monetary items denominated in foreign currency are translated at the exchange rate prevailing on the last day of the accounting<br />
year. In respect of items covered by forward contracts, the premium or discount arising at the inception of such a forward<br />
exchange contract is amortised as expense or income over the life of the contract. Any profit or loss arising on cancellation<br />
of such a forward exchange contract is recognised as income or expense for the period. Foreign currency transactions are<br />
accounted at the rate prevailing on the date of transaction.<br />
Non monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the<br />
exchange rate at the date of transaction.<br />
Income Tax<br />
Gain or loss arising out of translation/conversion is taken credit for or charged to the Profit and Loss Account.<br />
Income-tax expense comprises current tax and deferred tax charge or credit. The current tax is determined as the amount of tax<br />
payable in respect of the estimated taxable income for the year. The deferred tax charge or credit is recognised using prevailing<br />
enacted or substantively enacted tax rates. Where there is unabsorbed depreciation or carry forward losses, deferred tax assets are<br />
recognised only if there is virtual certainty of realisation of such assets. Other deferred tax assets are recognised only to the extent<br />
there is reasonable certainty of realisation in future. Deferred tax assets/liabilities are reviewed at each Balance Sheet date based on<br />
developments during the year and available case laws, to reassess realisation/liabilities.<br />
Contingencies/Provisions<br />
Provision is recognised when the Company has a present obligation as a result of past event; it is probable that an outflow of resources<br />
embodying economic benefit will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions<br />
except in respect of employee benefits are not discounted to its present value and are determined based on best estimate of the<br />
expenditure required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted<br />
to reflect the current best estimate. A contingent liability is disclosed, unless the possibility of an outflow of resources embodying the<br />
economic benefit is remote.
48 <strong>Clariant</strong> Chemicals (India) Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
2. Segment Information for the year ended 31st December, <strong>2009</strong> (As required by Accounting Standard (AS) – 17 Segment <strong>Report</strong>ing) :<br />
(a) The Company is organised into two primary business segments mainly :<br />
(i)<br />
(ii)<br />
Intermediates and Colours : Includes pigment dyestuffs and their dispersion, Intermediates for dyes, pesticides and<br />
pharmaceuticals and masterbatches for plastics and nylon fibers.<br />
Dyes and Specialty Chemicals : Includes dyestuff synthetic resins, binder materials, auxiliaries and chemicals.<br />
(b) The secondary segments of the Company are geographical segments mainly :<br />
(i)<br />
(ii)<br />
India<br />
Outside India<br />
(c)<br />
Segments have been identified and reported taking into account the nature of products and services, the differing risk and returns, the<br />
organisation structure, and the internal financial reporting system.<br />
(d) (i) Segment Revenue and Results :<br />
The expenses which are not directly attributable to the business segment are shown as unallocated corporate cost.<br />
(ii) Segment assets and liabilities :<br />
Segment assets include all operating assets used by the business segment and consist principally of fixed assets, debtors and<br />
inventories. Segment liabilities primarily include creditors and other liabilities.<br />
(iii)<br />
Assets and liabilities that cannot be allocated among the segments are shown as a part of unallocable corporate assets and<br />
liabilities respectively.<br />
Information about Primary Business Segments : (Contd.)<br />
Intermediates<br />
& Colours*<br />
<strong>2009</strong><br />
Rs. Lakhs<br />
Dyes and<br />
Specialty<br />
Chemicals<br />
Total<br />
Intermediates<br />
& Colours*<br />
2008<br />
Rs. Lakhs<br />
Dyes and<br />
Specialty<br />
Chemicals<br />
Revenue (Net)<br />
External Sales/Revenue 39266.95 52867.18 92134.13 40169.07 51470.40 91639.47<br />
Results<br />
Segment Results 8477.04 10694.37 19171.41 4704.42 7026.57 11730.99<br />
Unallocated Corporate Expenses (Net) (801.51) (1144.24)<br />
Operating Profits 18369.90 10586.75<br />
Interest Income/Dividend income 491.10 343.23<br />
Interest Expenses (99.87) (153.38)<br />
Profit Before Exceptional Items and Taxation 18761.13 10776.60<br />
Exceptional Items (See note 23, Schedule 17) (2450.46) (48.00)<br />
Profit Before Taxation After Exceptional Items 16310.67 10728.60<br />
Current Tax/Deferred Tax (5427.34) (3613.71)<br />
Fringe benefit Tax (39.00) (118.50)<br />
Short provision for taxation in respect of earlier years (30.77) (248.09)<br />
Profit After Tax 10813.56 6748.30<br />
Other Information<br />
Segment Assets 19429.34 19802.95 39232.29 20989.52 21564.60 42554.12<br />
Unallocated Corporate Assets 16863.84 9036.84<br />
Total Assets 56096.13 51590.96<br />
Segment Liabilities 6597.21 8997.45 15594.66 4585.83 8026.18 12612.01<br />
Unallocated Corporate Liabilities 1817.98 1505.08<br />
Total Liabilities 17412.64 14117.09<br />
Total
Notes<br />
49<br />
Information about Primary Business Segments : (Contd.)<br />
Intermediates<br />
& Colours*<br />
<strong>2009</strong><br />
Rs. Lakhs<br />
Dyes and<br />
Specialty<br />
Chemicals<br />
Total<br />
Intermediates<br />
& Colours*<br />
2008<br />
Rs. Lakhs<br />
Dyes and<br />
Specialty<br />
Chemicals<br />
Capital Expenditure 668.46 322.11 990.57 1413.84 1220.14 2633.98<br />
Unallocated Corporate Capital Expenditure 14.43 35.20<br />
Total Capital Expenditure 1005.00 2669.18<br />
Depreciation/Amortisation 1008.70 818.63 1827.33 1132.43 1032.82 2165.25<br />
Impairment of Fixed Assets 124.51 12.47 136.98 728.62 — 728.62<br />
Unallocated Corporate Depreciation 69.02 86.35<br />
Total Depreciation/Amortisation/Impairment 2033.33 2980.22<br />
Non Cash Expenses other than<br />
Depreciation/Amortisation/Impairment 61.72 63.93 125.65 541.04 296.07 837.11<br />
Unallocated Corporate Non Cash Expenses other<br />
than Depreciation/Amortisation/Impairment 64.28 33.20<br />
Total Non Cash Expenses other than<br />
Depreciation/Amortisation/Impairment 189.93 870.31<br />
Information about Secondary Segments :<br />
India<br />
<strong>2009</strong><br />
Rs. Lakhs<br />
Outside<br />
India<br />
2008<br />
Rs. Lakhs<br />
Total India Outside<br />
India<br />
External Sales 75032.64 17101.49 92134.13 72991.30 18648.17 91639.47<br />
Segment Assets 35612.25 3620.04 39232.29 39578.46 2975.66 42554.12<br />
Additions to Fixed Assets 990.57 — 990.57 2633.98 — 2633.98<br />
Notes :<br />
1. Total Assets exclude the following :<br />
(a) Advance payment of Income Tax Rs. 1768.95 lakhs (Rs. 1648.55 lakhs)<br />
(b) Deferred Tax Assets (Net) Rs. 275.72 lakhs (Rs. Nil)<br />
2. Total Liabilities exclude the following :<br />
(a) Proposed Dividend Rs. 3999.11 lakhs (Rs. 5065.54 lakhs)<br />
(b) Corporate Tax on proposed dividend Rs. 679.65 lakhs (Rs. 860.89 lakhs)<br />
(c) Provision for Taxation Rs. 1270.15 lakhs (Rs. 1177.43 lakhs)<br />
(d) Deferred Tax Liability (Net) Rs. Nil (Rs. 254.94 lakhs)<br />
* Products hitherto reported under “Masterbatches” segment is now reported under “Intermediates & Colours” segment since the products are<br />
similar in nature.<br />
Total<br />
Total<br />
3. Related Party Disclosure as required by AS-18 “Related Party Disclosures” are given below :<br />
Relationship :<br />
(a) Holding Company :<br />
EBITO Chemiebeteiligungen AG, <strong>Clariant</strong> International AG and <strong>Clariant</strong> Participations AG, together hold 63.40% equity shares in the<br />
Company, the ultimate holding company being <strong>Clariant</strong> AG, Switzerland.<br />
(b) Subsidiary of the Company :<br />
The Company has subsidiary Chemtreat Composites India Pvt. Ltd. – 100% shareholding.
50 <strong>Clariant</strong> Chemicals (India) Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
(c) Other related parties in the <strong>Clariant</strong> group where common control exists and with whom the company has transactions :<br />
Fellow Subsidiary Companies :<br />
<strong>Clariant</strong> (Argentina) SA<br />
<strong>Clariant</strong> Masterbatches (Italia) S.p.A.<br />
<strong>Clariant</strong> (Australia) Pty. Ltd.<br />
<strong>Clariant</strong> Masterbatches (Shanghai) Ltd.<br />
<strong>Clariant</strong> (Canada) Inc.<br />
<strong>Clariant</strong> Masterbatches (Thailand) Ltd.<br />
<strong>Clariant</strong> (China) Ltd.<br />
<strong>Clariant</strong> Masterbatches Benelux SA<br />
<strong>Clariant</strong> (Colombia) SA<br />
<strong>Clariant</strong> Masterbatches Huningue<br />
<strong>Clariant</strong> (Egypt) SAE<br />
<strong>Clariant</strong> Masterbatches Ireland Limited<br />
<strong>Clariant</strong> (Gulf) FZE<br />
<strong>Clariant</strong> Masterbatches Norden AB<br />
<strong>Clariant</strong> (Japan) K.K.<br />
<strong>Clariant</strong> Masterbatches UK Ltd.<br />
<strong>Clariant</strong> (Korea) Ltd.<br />
<strong>Clariant</strong> Oil Services UK Ltd.<br />
<strong>Clariant</strong> (Malaysia) Sdn Bhd<br />
<strong>Clariant</strong> Pigments (Korea) Ltd.<br />
<strong>Clariant</strong> (Maroc) S.A.<br />
<strong>Clariant</strong> Pigments (Tianjin) Ltd.<br />
<strong>Clariant</strong> (Mexico) S.A. de C.V.<br />
<strong>Clariant</strong> Prodotti (Italia) S.p.A.<br />
<strong>Clariant</strong> (Pakistan) Ltd.<br />
<strong>Clariant</strong> Production (France)<br />
<strong>Clariant</strong> (Singapore) Pte. Ltd.<br />
<strong>Clariant</strong> Production UK Ltd.<br />
<strong>Clariant</strong> (Thailand) Ltd.<br />
<strong>Clariant</strong> Produkte (Deutschland) GmbH<br />
<strong>Clariant</strong> (Tianjin) Ltd.<br />
<strong>Clariant</strong> Produkte (Schweiz) AG<br />
<strong>Clariant</strong> (Uruguay) SA<br />
<strong>Clariant</strong> S.A.<br />
<strong>Clariant</strong> Chemicals (China) Ltd.<br />
<strong>Clariant</strong> Southern Africa (Pty.) Ltd.<br />
<strong>Clariant</strong> Chemicals (Taiwan) Co., Ltd.<br />
<strong>Clariant</strong> Specialty Chemicals (Zhenjiang) Co., Ltd.<br />
<strong>Clariant</strong> Colorquímica (Chile) Ltd.<br />
<strong>Clariant</strong> Specialty Fine Chemicals (France)<br />
<strong>Clariant</strong> Corporation<br />
<strong>Clariant</strong> Trading (China) Ltd.<br />
<strong>Clariant</strong> Distribution UK Ltd.<br />
<strong>Clariant</strong> Venezuela, S.A.<br />
<strong>Clariant</strong> Distribuzione (Italia) S.p.A.<br />
Dick Peters B.V.<br />
<strong>Clariant</strong> Export AG<br />
K.J. Quinn<br />
<strong>Clariant</strong> Ibérica Producción S.A.<br />
PT <strong>Clariant</strong> Indonesia<br />
<strong>Clariant</strong> Masterbatch Ibérica S.A.<br />
<strong>Clariant</strong> (Türkiye) Boya ve Kimyevi Maddeler Sanayi ve Ticaret A.S.<br />
<strong>Clariant</strong> Masterbatches (Deutschland) GmbH<br />
(d) Key Management Personnel :<br />
H. Meier : Vice-Chairman & Managing Director (upto 31.12.<strong>2009</strong>)<br />
During the year following transactions were entered into with related parties : (Contd.)<br />
(i) Holding Company, Subsidiary Company and Fellow Subsidiaries : (Contd.)<br />
<strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
Holding Company :<br />
Transactions during the year :<br />
<strong>Clariant</strong> International AG<br />
Sale of goods 1501.15 1742.65<br />
Purchase of goods 9234.75 7673.84<br />
Services rendered 377.62 324.08<br />
Services received 699.34 644.13<br />
Dividend paid 1761.75 607.50<br />
Expenses recovered 1.51 19.46<br />
EBITO Chemiebeteiligungen AG<br />
Dividend Paid 2368.46 816.71<br />
<strong>Clariant</strong> Participations AG<br />
Dividend Paid 771.40 266.00<br />
Balances outstanding as at the year end :<br />
Amount payable 1142.51 984.03<br />
Amount receivable 449.12 676.53<br />
Subsidiary Company :<br />
Transactions during the year :<br />
Chemtreat Composites India Pvt. Ltd.<br />
Sale of goods — 0.41<br />
Sale of capital goods — 16.87<br />
Purchase of goods — 0.20<br />
Services rendered 115.94 115.00<br />
Loan given during the year 31.00 75.00<br />
Loan repaid during the year 1.00 —<br />
Amount receivable 688.35 709.47
Notes<br />
51<br />
During the year following transactions were entered into with related parties : (Contd.)<br />
(i) Holding Company, Subsidiary Company and Fellow Subsidiaries : (Contd.)<br />
<strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
Fellow Subsidiaries :<br />
Transactions during the year :<br />
Sale of goods<br />
<strong>Clariant</strong> Produkte (Deutschland) GmbH 1419.66 2338.86<br />
<strong>Clariant</strong> Corporation 1157.42 2158.91<br />
<strong>Clariant</strong> (China) Ltd. 2895.33 1524.41<br />
PT <strong>Clariant</strong> Indonesia 1170.42 811.89<br />
Others 4369.00 3944.64<br />
Purchase of goods<br />
<strong>Clariant</strong> (Tianjin) Ltd. 51.95 170.67<br />
<strong>Clariant</strong> (China) Ltd. 771.38 1008.24<br />
<strong>Clariant</strong> Corporation 44.82 127.58<br />
Others 474.29 211.87<br />
Purchase of capital goods<br />
<strong>Clariant</strong> Masterbatches (Deutschland) GmbH 5.27 170.08<br />
<strong>Clariant</strong> Masterbatches (Italia) S.p.A. 10.00 23.34<br />
<strong>Clariant</strong> Production UK Ltd. 2.97 —<br />
Sale of capital goods<br />
<strong>Clariant</strong> Produkte (Deutschland) GmbH 50.47 —<br />
Services rendered and others<br />
<strong>Clariant</strong> Export AG 308.38 283.67<br />
<strong>Clariant</strong> Produkte (Deutschland) GmbH 0.54 70.55<br />
Others 40.52 44.70<br />
Expenses recovered<br />
<strong>Clariant</strong> Produkte (Deutschland) GmbH — 4.49<br />
PT <strong>Clariant</strong> Indonesia 0.22 —<br />
<strong>Clariant</strong> (Singapore) Pte. Ltd. 0.05 —<br />
Others — 0.78<br />
Services received and others<br />
PT <strong>Clariant</strong> Indonesia 18.49 8.19<br />
<strong>Clariant</strong> (Singapore) Pte. Ltd. 20.67 29.65<br />
<strong>Clariant</strong> Southern Africa (Pty.) Ltd. 27.35 8.86<br />
<strong>Clariant</strong> Produkte (Deutschland) GmbH — 8.93<br />
<strong>Clariant</strong> S.A. — 10.51<br />
<strong>Clariant</strong> (Gulf) FZE 11.37 2.77<br />
Others 16.55 17.83<br />
Expenses reimbursed<br />
PT <strong>Clariant</strong> Indonesia 0.76 —<br />
<strong>Clariant</strong> (Malaysia) Sdn Bhd 1.63 —<br />
Balances outstanding as at the year end :<br />
Amount payable 424.20 520.37<br />
Amount receivable 2453.27 1441.32<br />
(ii) Key Management Personnel :<br />
Remuneration 217.09 164.97<br />
Payable balance 67.58 26.75
52 <strong>Clariant</strong> Chemicals (India) Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
4. Contingent liabilities not provided for :<br />
31-12-<strong>2009</strong><br />
Rs. Lakhs<br />
31-12-2008<br />
Rs. Lakhs<br />
I. (a) in respect of income tax matters<br />
decided against the Company, in respect of which the Company is in further appeal 1458.40 856.16<br />
decided in favour of the Company against which the department is in appeal 14.78 14.78<br />
(b) in respect of sales tax matters 578.58 494.22<br />
(c) in respect of excise matters 448.03 455.66<br />
(d) in respect of bills of exchange discounted with banks<br />
1119.58 29.60<br />
[since realised Rs. 778.63 lakhs (Rs. 17.73 lakhs)]<br />
(e) Other matters in dispute 2.25 2.25<br />
(f) Disputed Labour matters – Amount not ascertained<br />
In respect of items (a) to (c), (e) & (f) future cash outflows in respect of contingent liabilities is determinable only on receipt of judgements<br />
pending at various forums/authorities.<br />
II. On 15th February 2005, the Company had received an order of the Tahsildar, Thane demanding Rs. 120.70 lakhs for the lease of land to<br />
Thane Municipal Corporation, Fire Brigade and Maharashtra State Electricity Board without obtaining prior permission in writing against<br />
which the Company had filed a writ petition on 23rd February 2005 before the Bombay High Court. The Hon’ble High Court has granted<br />
interim stay in terms of the petition on 14th July 2005.<br />
31-12-<strong>2009</strong><br />
Rs. Lakhs<br />
31-12-2008<br />
Rs. Lakhs<br />
5. Estimated amount of contracts remaining to be executed on capital account and not<br />
provided for 134.25 148.31<br />
6. Deferred Taxes :<br />
The major components of deferred tax assets and deferred tax liabilities are set out below :<br />
31-12-<strong>2009</strong><br />
Rs. Lakhs<br />
31-12-2008<br />
Rs. Lakhs<br />
Deferred Tax Assets<br />
(a) Provision for doubtful debts 105.50 95.50<br />
(b) Provision for retirement benefits 215.89 327.47<br />
(c) Expenses allowable for tax purposes when paid 53.54 53.54<br />
(d) Integration expenses 15.74 78.70<br />
(e) Payment/Provision for Voluntary retirement scheme 1184.64 552.46<br />
(f) Others — 1.23<br />
1575.31 1108.90<br />
Deferred Tax Liabilities<br />
Depreciation/Amortisation/Impairment (1299.59) (1363.84)<br />
Deferred Tax Assets/(Liabilities) – Net 275.72 (254.94)<br />
7. Disclosure required under the Micro, Small and Medium Enterprises Development<br />
Act, 2006 (the Act) are given as follows :<br />
31-12-<strong>2009</strong><br />
Rs. Lakhs<br />
31-12-2008<br />
Rs. Lakhs<br />
(a) Principal amount due 361.14 82.25<br />
Interest due on the above — —<br />
(b) Interest paid during the year beyond the appointed day — —<br />
(c) Amount of interest due and payable for the period of delay in making payment without<br />
adding the interest specified under the Act — —<br />
(d) Amount of interest accrued and remaining unpaid at the end of the year — —<br />
(e) Amount of further interest remaining due and payable even in the succeeding years,<br />
untill such date when the interest dues as above are actually paid to the small<br />
enterprise for the purpose of disallowance as a deductible expenditure under<br />
Section 23 of the Act — —<br />
The above information and that given in Schedule-10 ‘Current Liabilities’ regarding micro<br />
enterprises and small enterprises has been determined on the basis of information available<br />
with the Company. This has been relied upon by the auditors. No Interest has been accrued<br />
for delayed payments, if any.
Notes<br />
53<br />
8. Disclosure in respect of Derivative Instruments :<br />
The Company uses Forward Exchange Contracts to hedge its exposure in foreign currency. The information on derivative instruments is as follows :<br />
(a)<br />
(b)<br />
Amount in<br />
foreign currency<br />
31-12-<strong>2009</strong> 31-12-2008<br />
Amount Amount in<br />
Rs. Lakhs foreign currency<br />
Amount<br />
Rs. Lakhs<br />
Forward Exchange Contracts outstanding as at<br />
Currency<br />
USD/INR (Sale) 750000 350.53 500000 251.03<br />
EUR/INR (Purchase) 200000 135.60 — —<br />
Foreign currency exposures not covered by a derivative<br />
instrument<br />
(i) Amount receivable on account of export of goods and services :<br />
Currency<br />
USD 7195779 3354.49 5653335 2743.73<br />
EUR 207550 139.49 124555 85.12<br />
CHF 278569 126.06 320046 146.81<br />
3620.04 2975.66<br />
(ii) Amount payable on account of import of goods and services :<br />
Currency<br />
USD 1813887 843.96 2366286 1144.07<br />
EUR 1598195 1074.12 1618387 1106.89<br />
CHF 352103 159.33 337817 154.96<br />
GBP — — 14742 10.38<br />
2077.41 2416.30<br />
9. (a) Amount paid/payable by the Company to Directors (including Managing Director) as remuneration for services rendered<br />
in any capacity :<br />
<strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
Directors’ sitting fees 1.45 0.90<br />
Salaries 137.76 136.17<br />
Commission 36.75 34.75*<br />
Compensation for loss of office 40.83 —<br />
Provident fund 11.35 1.89<br />
Other perquisites and benefits in cash or in kind 0.40 0.16<br />
228.54 173.87<br />
* Actual paid during the year Rs. 25.49 lakhs and Rs. 9.26 lakhs reversed during the year.<br />
(b) Computation of net profit for commission payable to the Directors in accordance with Section 198 of the Companies<br />
Act, 1956 :<br />
<strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
Profit after tax as per profit and loss account 10813.56 6748.30<br />
Add : Provision for taxation-Net 5497.11 3980.30<br />
Managerial remuneration 228.54 173.87<br />
Wealth tax 2.50 5.00<br />
Voluntary retirement scheme compensation 2810.46 48.00<br />
Impairment of fixed assets 136.98 728.62<br />
Provision for doubtful debts/advances (net) 29.39 200.11<br />
8704.98 5135.90<br />
19518.54 11884.20<br />
Less : Profit on sale of investments 0.21 0.29<br />
Income from sale of flexible laminating adhesives business 360.00 —<br />
Capital Profit on sale of fixed assets 48.88 9.93<br />
409.09 10.22<br />
Net profit as per Section 198 19109.45 11873.98<br />
Commission :<br />
To Vice-Chairman & Managing Director<br />
Restricted to sum as determined by the Board of Directors. 26.75 26.75*<br />
To Directors who are not in whole-time employment of the Company @ 1% of net profit<br />
i.e. Rs. 191.09 lakhs (Rs. 118.74 lakhs)<br />
Restricted to sum as determined by the Board of Directors. 10.00 8.00<br />
36.75 34.75<br />
* Actual paid during the year Rs. 17.49 lakhs
54 <strong>Clariant</strong> Chemicals (India) Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
10. Capacities and production :<br />
<strong>2009</strong> 2008<br />
Class of goods<br />
<strong>Annual</strong><br />
Installed<br />
<strong>Annual</strong><br />
Installed<br />
Capacity Production<br />
Capacity Production<br />
M. Tonnes # M. Tonnes * # M. Tonnes # M. Tonnes * #<br />
(a) Intermediates and Colours 28027 15690 29455 20934<br />
(b) Dyes and Specialty Chemicals 66660 50201 63070 42979<br />
* Excluding captive consumption<br />
# At different concentrations<br />
Notes :<br />
1. The classification between the class of goods and the installed capacities have been certified by the Vice-Chairman & Managing<br />
Director on which the auditors have placed reliance, this being a technical matter.<br />
2. Licensed capacity per annum not indicated due to the abolition of Industrial Licenses as per Notification No. 477(E) dated 25th July, 1991<br />
issued under The Industries (Development and Regulations) Act, 1951.<br />
11. Purchase of finished goods :<br />
<strong>2009</strong> 2008<br />
Class of goods Quantity Value Quantity Value<br />
M. Tonnes * Rs. Lakhs M. Tonnes * Rs. Lakhs<br />
Trading Items :<br />
Dyes, Chemicals, Pigments, Masterbatches, etc. 7241 12133.72 7528 13003.39<br />
* Includes 532 M. Tonnes (797 M. Tonnes) used for captive consumption.<br />
12. Raw materials consumed :<br />
<strong>2009</strong> 2008<br />
Quantity Value Quantity Value<br />
M. Tonnes Rs. Lakhs M. Tonnes Rs. Lakhs<br />
(a) Acetic acid glacial 9777 2741.79 9831 3139.24<br />
(b) Others (None of the items individually<br />
35708.40 38909.28<br />
exceed 10% of the total value of raw<br />
materials consumed)<br />
38450.19 42048.52<br />
Note : Raw materials consumed have been arrived at after write down of certain items and excess/shortage on physical verification.<br />
13. Consumption of raw materials :<br />
<strong>2009</strong> 2008<br />
% of total Value % of total Value<br />
Consumption Rs. Lakhs Consumption Rs. Lakhs<br />
(a) Raw materials :<br />
Imported 33.70 12956.32 31.79 13365.31<br />
Indigenous 66.30 25493.87 68.21 28683.21<br />
100.00 38450.19 100.00 42048.52<br />
(b) Components and spare parts referred to in Paragraph 4D (c) of Schedule VI of the Companies Act, 1956 are assumed to be incorporated<br />
in the goods produced and not those used for maintenance of plant and machinery.<br />
14. Sales, Opening and Closing Stock :<br />
Class of goods Opening Stock Closing Stock Sales (inclusive of<br />
excise duty)<br />
Quantity<br />
M. Tonnes<br />
Value<br />
Rs. Lakhs<br />
Quantity<br />
M. Tonnes<br />
Value<br />
Rs. Lakhs<br />
Quantity<br />
M. Tonnes<br />
Value<br />
Rs. Lakhs<br />
(a) Intermediates and Colours 777 2774.40 564 1651.62 15903 39838.43<br />
(770) (2382.95) (777) (2774.40) (20927) (43478.44)<br />
(b) Dyes and Specialty Chemicals 1617 1458.51 1860 1265.37 49958 42855.95<br />
(2903) (2327.94) (1617) (1458.51) (44265) (40773.80)<br />
(c) Trading items (including dyes, chemicals,<br />
pigments, masterbatches, etc.) 828 1485.72 889 1505.92 6648 14627.86<br />
(1171) (1914.75) (828) (1485.72) (7074) (15893.10)<br />
5718.63 4422.91 97322.24<br />
(6625.64) (5718.63) (100145.34)
Notes<br />
55<br />
<strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
15. Earnings per share :<br />
(a) Net profit after taxation 10813.56 6748.30<br />
(b) Number of equity shares outstanding 26660745 26660745<br />
(c) Basic and Diluted earnings per share (Rupees) 40.56 25.31<br />
(d) Face value per share (Rupees) 10.00 10.00<br />
16. Assets taken on lease on or after 1st April, 2001 :<br />
(a) In respect of operating leases, where lease agreements have been formally entered into,<br />
lease payments recognised in the profit and loss account for the year are as follows.<br />
Office premises, vehicles and computers 382.43 377.91<br />
(b) There are no restrictions such as those concerning dividends, additional debt and further<br />
leasing, imposed by the lease agreements entered into by the Company.<br />
(c) Contingent rent payments in respect of vehicles are dependent upon the excess of<br />
actual usage, if any, over stipulated usage.<br />
(d) The total of future minimum lease payments under non-cancellable operating leases are<br />
as follows :<br />
For a period not later than one year 285.05 326.65<br />
For a period later than one year and not later than five years 254.37 343.68<br />
Total 539.42 670.33<br />
17. Expenditure on Research and Development :<br />
(a) Capital expenditure 3.36 9.93<br />
(b) Revenue expenditure charged to profit and loss account 224.20 323.29<br />
227.56 333.22<br />
18. Miscellaneous Expenses in Schedule 16 : Other expenditure include :<br />
Auditors’ remuneration and expenses : (Excluding Service tax)<br />
(a) Audit fees 22.00 22.00<br />
(b) Company law matters 0.15 —<br />
(c) Taxation services 0.23 —<br />
(d) Other services 28.20 32.25<br />
(e) Out-of-pocket expenses 0.45 0.11<br />
51.03 54.36<br />
19. Value of imports (C.I.F.) :<br />
(a) Raw materials and trading items 16908.62 19144.01<br />
(b) Components and spare parts 10.87 11.28<br />
(c) Capital goods 104.49 394.19<br />
20. Expenditure in foreign currency (subject to deduction of tax where applicable) :<br />
(a) Commission 177.65 142.98<br />
(b) Interest 6.58 57.22<br />
(c) Others (includes exchange loss) 1579.68 1483.83<br />
21. Remittance in foreign currency on account of dividend :<br />
Number of non-resident shareholders where direct remittances have been made by the Company 3 3<br />
Number of shares on which dividend is remitted 16902080 16902080<br />
Year to which dividend relates<br />
<strong>2009</strong> (Interim) 1690.21 —<br />
2008 (Final) 3211.40 —<br />
2007 (Final) — 1690.21<br />
22. Earnings in foreign exchange :<br />
(a) Exports (F.O.B.) 16612.73 18185.95<br />
(b) Know-how 132.71 155.09<br />
(c) Sale of capital goods 50.47 —<br />
(d) Others (insurance, freight, commission, claims, exchange gain etc.) 1268.50 1392.98<br />
23. Exceptional items in Profit & Loss Account include :<br />
Termination benefits to Employees 2810.46 48.00<br />
Income from sale of flexible laminating adhesives business (360.00) —<br />
2450.46 48.00
56 <strong>Clariant</strong> Chemicals (India) Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
24. Employee Benefits :<br />
<strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
Funded Unfunded Funded Unfunded<br />
(a) Defined benefit Plans - As per Actuarial valuation as on December 31, <strong>2009</strong> :<br />
Gratuity<br />
(i) Expenses recognised in the statement of Profit and Loss Account for the year<br />
1. Current service cost 181.10 4.17 190.63 4.36<br />
2. Interest cost 178.36 6.86 142.81 6.01<br />
3. Expected return on plan assets (204.25) — (194.58) —<br />
4. Net actuarial (gain)/loss recognised during the year (133.86) 4.54 234.40 (5.81)<br />
5. Expense/(Income) recognised in profit & loss account 21.35 15.57 373.26 4.56<br />
[Gratuity expense/(income) have been recognised in Contribution/<br />
Provision for provident fund, superannuation scheme, gratuity fund<br />
etc. in “Personnel Cost” under Schedule 14]<br />
(ii) Actual return on plan assets for the year<br />
1. Expected return on plan assets 204.25 — 194.58 —<br />
2. Actuarial gain/(loss) on plan assets (38.87) — 39.51 —<br />
3. Actual return on plan assets 165.38 — 234.09 —<br />
(iii) Net Asset/(Liability) recognised in the Balance Sheet as at the year end<br />
1. Present value of the defined benefit obligation 2342.20 69.21 2940.12 84.42<br />
2. Fair value of plan assets 2141.47 — 2553.09 —<br />
3. Net Asset/(Liability) recognised in the balance sheet (200.73) (69.21) (387.03) (84.42)<br />
(iv) Change in defined benefit obligation during the year<br />
1. Present value of obligation at the beginning of the year 2940.12 84.42 2551.45 80.18<br />
2. Current service cost 181.10 4.17 190.63 4.36<br />
3. Interest cost 178.36 6.86 142.81 6.01<br />
4. Benefits paid (784.65) (30.78) (218.68) (0.32)<br />
5. Actuarial (gain)/loss on obligation (172.73) 4.54 273.91 (5.81)<br />
6. Present value of obligation as at the end of the year 2342.20 69.21 2940.12 84.42<br />
(v) Changes in fair value of plan asset during the year<br />
1. Fair value of plan assets as at the beginning of the year 2553.09 — 2432.22 —<br />
2. Expected return on plan assets 204.25 — 194.58 —<br />
3. Contributions made 207.65 — 105.46 —<br />
4. Benefits paid (784.65) — (218.68) —<br />
5. Actuarial gain/(loss) on plan assets (38.87) — 39.51 —<br />
6. Fair value of plan assets as at the end of the year 2141.47 — 2553.09 —<br />
(vi) Major categories of Plan Assets as a percentage of total plan assets<br />
1. Central government securities 29.64% — 24.84% —<br />
2. State government securities 12.32% — 10.03% —<br />
3. Private sector bonds 20.90% — 15.21% —<br />
4. Special deposit scheme 25.54% — 21.69% —<br />
5. Cash at bank 1.15% — 1.10% —<br />
6. Investment in insurance companies 22.06% — 22.67% —<br />
7. Others (11.61%) — 4.46% —<br />
(vii) Actuarial assumptions<br />
1. Discount rate 8.0% 8.0% 7.0% 7.0%<br />
2. Expected Rate of return on plan assets 8.0% — 8.0% —<br />
3. Salary escalation 4.0%-6.0% 4.0%-6.0% 4.0%-6.0% 4.0%-6.0%<br />
(viii) Experience adjustments<br />
1. Experience adjustments on plan assets (38.87) — — —<br />
2. Experience adjustments on plan liabilities (49.77) 4.54 — —
Notes<br />
57<br />
24. Employee Benefits : (Contd.)<br />
(a)<br />
Defined benefit Plans - As per Actuarial valuation as on December 31, <strong>2009</strong> : (Contd.)<br />
<strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
Other long term benefits<br />
The defined benefit obligations which are provided for but not funded are as under :<br />
Compensated Absence/Leave Salary 365.02 491.71<br />
(b) Gratuity is administered through duly constituted and approved independent trusts and<br />
also through Group gratuity scheme with Life Insurance Corporation of India<br />
(c) Future salary increases considered in acturial valuation take in to account inflation,<br />
seniority, promotion and other relevant factors, such as supply and demand in the<br />
employment market<br />
(d) Basis used to determine expected rate of return on plan assets :<br />
The expected rate of return on plan assets is based on market expectation, at the<br />
beginning of the year, for returns over the entire life of the related obligation.<br />
(e) Accounting standard 15 (Revised 2005) "Employee Benefits" requires the disclosure of<br />
experience adjustments for past four years, however, the information is given only for the<br />
current year.<br />
(f) During the year the Company has recognised the following amounts in the Profit & Loss<br />
account in Schedule 14 :<br />
Salaries, wages, bonus includes compensated absences 49.17 93.02<br />
Contribution/Provision for provident fund, superannuation scheme, gratuity fund etc. includes :<br />
Provident Fund & Family Pension 275.30 278.81<br />
Superannuation Fund 239.24 370.57<br />
Gratuity Fund 36.92 377.82<br />
Other funds 0.49 1.00<br />
25. Advances and loans to the subsidiary of Rs. 688.35 lakhs (Rs. 709.47 lakhs) is due from Chemtreat Composites India Private Ltd. Maximum<br />
amount due during the year Rs. 750.22 lakhs (Rs. 786.22 lakhs). This amount is interest free and repayable on demand.<br />
26. The Company has entered into an agreement with Laxmi Organic Industries Ltd. on May 15, <strong>2009</strong> for the sale of its business of Diketene and<br />
downstream intermediate products together with removable plant and equipment. On receipt of full consideration, the transaction has been<br />
concluded in January 2010.<br />
27. Figures for the previous year have been regrouped wherever necessary to conform to the current year’s classification.<br />
28. The figures in brackets are those in respect of the previous accounting year.<br />
For and on behalf of the Board<br />
R. A. Shah Chairman<br />
P. Palm Vice-Chairman & Managing Director<br />
Diwan A. Nanda Director<br />
B. L. Gaggar Director Finance & Company Secretary<br />
Mumbai, 19th February, 2010
58 <strong>Clariant</strong> Chemicals (India) Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
Statement pursuant to Part IV of Schedule VI to The Companies Act, 1956<br />
Balance Sheet Abstract and Company’s General Business Profile<br />
I. Registration Details<br />
II.<br />
III.<br />
IV.<br />
Registration No. 1 1 – 1 0 8 0 6 State Code 1 1<br />
Balance Sheet Date 3 1 – 1 2 – 2 0 0 9<br />
Date Month Year<br />
Capital raised during the year (Amount in Rs. Thousands)<br />
Public Issue N I L Right Issue N I L<br />
Bonus Issue N I L Private Placement N I L<br />
Position of Mobilisation and Deployment of Funds (Amount in Rs. Thousands)<br />
Total Liabilities* 5 8 1 4 0 8 0 Total Assets 5 8 1 4 0 8 0<br />
Sources of Funds<br />
Paid-up Capital 2 6 6 6 0 7 Reserves and Surplus 3 2 1 1 3 1 8<br />
Secured Loans N I L Unsecured Loans 2 0 4 7 8<br />
Application of Funds<br />
Net Fixed Assets 1 5 2 7 3 3 6 Investments 1 2 4 4 9 9 5<br />
Net Current Assets** 7 2 6 0 7 2 Miscellaneous Expenditure N I L<br />
Accumulated Losses N I L<br />
*Including Shareholder’s funds ** Includes Deferred tax Assets (net) Rs. 27572<br />
Performance of Company (Amount in Rs. Thousands)<br />
Turnover (Gross Revenue) @ 9 4 7 6 4 9 5 Total Expenditure 7 8 4 5 4 2 8<br />
@ Includes Other Income Rs. 263082<br />
+ – Profit Before Tax + – Profit After Tax<br />
P 1 6 3 1 0 6 7 P 1 0 8 1 3 5 6<br />
Earnings Per Share in Rs.** 4 0 . 5 6 Dividend Rate % 2 5 0<br />
** Earnings per share has been computed by dividing profit after tax by the total number of issued equity shares as at the year end.<br />
V. Generic Names of Three Principal Products of Company<br />
Item Code No. 3 2 0 4 1 7 . 5 1<br />
Product Description H O S T A P E R M G R E E N G N X<br />
Item Code No. 2 9 2 4 1 0 . 1 9<br />
Product Description A C E T O A C E T M O N O M E T H Y L A M I D E 7 0 %<br />
Item Code No. 2 9 1 5 9 0 . 0 0<br />
Product Description A C E T O A C E T I C M E T H Y L E S T E R<br />
Statement Pursuant to Section 212 of the Companies Act, 1956<br />
For and on behalf of the Board<br />
R. A. Shah Chairman<br />
P. Palm Vice-Chairman & Managing Director<br />
Diwan A. Nanda<br />
Director<br />
B. L. Gaggar Director Finance & Company Secretary<br />
Mumbai, 19th February, 2010<br />
Name of the Subsidiary Company<br />
Chemtreat Composites India Private Limited<br />
1. Financial year of the Subsidiary Company January <strong>2009</strong> – December <strong>2009</strong><br />
2. Total issued and paid-up Share Capital of the Subsidiary Company<br />
(a) Issued 500,000 equity shares of Rs. 10/- each<br />
(b) Subscribed and Paid-up 500,000 equity shares of Rs. 10/- each<br />
3. Extent of Interest of <strong>Clariant</strong> Chemicals (India) Limited at the end of the financial year 100%<br />
4. Net aggregate amount of profits (Loss) of the Subsidiary Company not dealt with in the<br />
accounts of the <strong>Clariant</strong> Chemical (India) Limited<br />
(a) for the current financial year Rs. (52.39) Lakhs<br />
(b) for the previous financial years Rs. 10.92 Lakhs<br />
For and on behalf of the Board<br />
R. A. Shah Chairman<br />
P. Palm Vice-Chairman & Managing Director<br />
Diwan A. Nanda<br />
Director<br />
B. L. Gaggar Director Finance & Company Secretary<br />
Mumbai, 19th February, 2010
Chemtreat Composites India Private Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
59<br />
Directors‘ <strong>Report</strong><br />
Annexure to Directors‘ <strong>Report</strong><br />
Your directors are pleased to present the 23rd annual report and audited statement of accodunts<br />
for the year ended December 31, <strong>2009</strong>.<br />
Financial Results<br />
The financial performance of the Company for the year ended December 31, <strong>2009</strong> is summarized<br />
below:<br />
Rs. ‘000<br />
<strong>2009</strong> 2008<br />
Revenue 33,086 40,707<br />
Expenditure (38,325) (50,859)<br />
Loss before taxation (5,239) (10,152)<br />
Less: Provision for taxation (incl. deferred tax) – (6,345)<br />
Loss after tax (5,239) (3,807)<br />
Add: Balance brought forward from previous year 1,092 4,899<br />
Balance carried forward to balance sheet (4,147) 1,092<br />
Review of Operations<br />
The Company is a 100% Export Oriented Unit. The global economic & financial crisis<br />
affected the Company’s performance. Sales were down at Rs. 298.5 Lakhs as against<br />
Rs. 384.9 Lakhs in the previous year.<br />
However, the Company continued its efforts of exploring new markets and succeeded in<br />
establishing new market segments in India and Australia.<br />
Dividend<br />
The Board has not recommended any dividend for the year.<br />
Particulars of Employees<br />
There are no employees in respect of whom information pursuant to section 217(2A) of the<br />
Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 as<br />
amended.<br />
Directors<br />
Mr. Dominik Strebel resigned with effect from February 20, <strong>2009</strong> and Mr. Walter Kindler was<br />
appointed in his place. Mr. Heiner Meier , Mr. Walter Kindler and Mr. B L Gaggar were the<br />
Directors of the Company as on December 31, <strong>2009</strong>.<br />
Mr. Heiner Meier resigned with effect from January 1, 2010 and Mr. Peter Palm was appointed<br />
in his place. Mr. Walter Kindler resigned with effect from January 1, 2010 and Dr. H. Schloemer<br />
was appointed in his place.<br />
Directors’ Responsibility Statement<br />
In terms of section 217 (2AA) of the Companies Act, 1956 your directors confirm that:<br />
(a) in the preparation of the annual accounts, the applicable accounting standards have been<br />
followed;<br />
(b) they have selected such accounting policies and applied them consistently and made<br />
judgments and estimates that are reasonable and prudent so as to give a true and fair view of<br />
the state of affairs of the Company as at December 31, <strong>2009</strong> and of the loss of the Company<br />
for that year;<br />
(c) they have taken proper and sufficient care for the maintenance of adequate accounting<br />
records in accordance with the provisions of the Companies Act, 1956 for safeguarding the<br />
assets of the Company and for preventing and detecting fraud and other irregularities.<br />
(d) they have prepared the annual accounts on a going concern basis.<br />
Conservation of Energy, Research and Development, Technology Absorption,<br />
Foreign Exchange Earnings and Outgo<br />
Information required under section 217(1)(e) of the Companies Act, 1956 read with the Companies<br />
(Disclosure of Particulars in the <strong>Report</strong> of Board of Directors) Rules, 1988 is annexed hereto and<br />
forms part of the report.<br />
Auditors<br />
M/s. Deloitte Haskins & Sells, Chartered Accountants, retire at the conclusion of the ensuing<br />
<strong>Annual</strong> General Meeting and being eligible offers themselves for re-appointment.<br />
For and on behalf of the Board of Directors<br />
P. Palm B. L. Gaggar<br />
Mumbai, February 19, 2010 Director Director<br />
Information as per section 217(1)(e) read with Companies (Disclosure of Particulars in the <strong>Report</strong><br />
of Board of Directors) Rules, 1988 and forming part of the Directors' report for the year ended<br />
December 31, <strong>2009</strong>.<br />
FORM-A<br />
Particulars with respect to conservation of energy<br />
A. Power and fuel consumption:<br />
1. Electricity:<br />
(a) Purchased:<br />
<strong>2009</strong> 2008<br />
Units (in ‘000 KwH) 327 278<br />
Total amount (Rs. Lakhs) 17.66 14.87<br />
Rate per Unit (Rs.) 5.39 5.35<br />
(b) Own Generation:<br />
(i)<br />
Through diesel generator<br />
Units (in ‘000 KwH) 6.99 20.89<br />
Units per Litre of diesel oil 1.49 1.67<br />
Cost per Unit (Rs.) 23.75 22.57<br />
(ii) Through Steam turbine/generator Nil Nil<br />
2. Furnace Oil (including L.S.H.S.)<br />
Quantity (MT) 9.05 14.02<br />
Total Cost (Rs. Lakhs) 3.21 5.32<br />
Average rate (Rs. per Kg.) 35.47 37.97<br />
3. Other internal generation Nil Nil<br />
B. Consumption per unit of production:<br />
The Company manufactures a wide variety of products. The products before reaching the<br />
finished final stage pass through various operations in the different plants. It is, therefore,<br />
not feasible to furnish the information in respect of consumption per unit of production.<br />
FORM-B<br />
Form of disclosure of particulars with respect to Technology Absorption, Research &<br />
Development (R&D)<br />
Research & Development<br />
1. Specific Areas in which R&D carried out : Development of the pigmented polysilazane<br />
by the Company<br />
and chrome replacement coatings.<br />
2. Benefits derived as a result of the above : Introduction of new products for Indian<br />
R & D<br />
Railways & automotive industry.<br />
3. Future plan of action : Development of various coatings colours for<br />
Indian Railways and chrome replacement<br />
coatings for automotive parts.<br />
Technology absorption, adaptation and innovation:<br />
1. Efforts, in brief, made towards technology : New synthesis are successfully adopted &<br />
absorption, adaptation and innovation scaled up with Group Support.<br />
2. Benefits derived as a result of the above : The new products can be used as high quality<br />
efforts, e.g. product improvement, cost chemicals in pharma applications.<br />
reduction, product development, import<br />
substitution etc.<br />
3. In case of imported technology (imported :<br />
during the last 5 years reckoned from the<br />
beginning of the financial year), following<br />
information may be furnished<br />
(a) Technology imported : Polysilazanes manufacture and formulations<br />
(b) Year of import : 2006<br />
(c) Has technology been fully<br />
absorbed<br />
Foreign Exchange Earnings and<br />
Outgo<br />
: Formulations technology transfer was<br />
successfully adopted and standardized in<br />
2007.<br />
: Refer Schedule 14: of Notes to Accounts Item<br />
Nos. 14 to 16<br />
For and on behalf of the Board of Directors<br />
P. Palm B. L. Gaggar<br />
Mumbai, February 19, 2010 Director Director
60 Chemtreat Composites India Private Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
Auditors‘ <strong>Report</strong><br />
To the Members of Chemtreat Composites India Private<br />
Limited<br />
1. We have audited the attached Balance Sheet of Chemtreat Composites India Private<br />
Limited as at December 31, <strong>2009</strong>, and also the Profit and Loss Account and the Cash Flow<br />
Statement for the year ended on that date annexed thereto. These financial statements are<br />
the responsibility of the Company’s management. Our responsibility is to express an opinion<br />
on these financial statements based on our audit.<br />
2. We conducted our audit in accordance with auditing standards generally accepted in India.<br />
Those Standards require that we plan and perform the audit to obtain reasonable assurance<br />
about whether the financial statements are free of material misstatement. An audit includes<br />
examining on test basis, evidence supporting the amounts and disclosure in the financial<br />
statements. An audit also includes assessing the accounting principles used and significant<br />
estimates made by the management, as well as evaluating the overall financial statement<br />
presentation. We believe that our audit provides a reasonable basis for our opinion.<br />
3. As required by the Companies (Auditor’s <strong>Report</strong>) Order, 2003, (‘the Order’) issued by the<br />
Central Government of India in terms of sub- section (4A) of Section 227 of the Companies<br />
Act, 1956, we enclose in the annexure a statement on the matters specified in paragraphs 4<br />
and 5 of the said Order to the extent applicable to the Company.<br />
4. Further to our comments in the Annexure referred to in paragraph 3 above, we report that:<br />
(a) we have obtained all the information and explanation, which to the best of our knowledge<br />
and belief were necessary for the purposes of our audit;<br />
(b) in our opinion, proper books of account as required by law have been kept by the<br />
Company, so far as appears from our examination of the books;<br />
(c) the Balance Sheet, Profit and Loss Account and the Cash Flow Statement dealt with by<br />
this report are in agreement with the books of accounts;<br />
(d) in our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement<br />
dealt with by this report comply with the Accounting Standards referred to in<br />
sub-section (3C) of Section 211 of the Companies Act, 1956;<br />
(e) on the basis of the written representations received from the directors, as on<br />
December 31, <strong>2009</strong>, and taken on record by Board of Directors, we report that<br />
none of the directors of the Company are disqualified as on December 31, <strong>2009</strong><br />
from being appointed as director, in terms of clause (g) of sub-section (1) of<br />
Section 274 of the Companies Act, 1956; and<br />
(f) in our opinion and to the best of our information and according to the explanations<br />
given to us, the said accounts give the information required by the Companies<br />
Act, 1956, in the manner so required and give a true and fair view in conformity with the<br />
accounting principles generally accepted in India:<br />
(i) in the case of the Balance Sheet, of the state of affairs of the Company as at<br />
December 31, <strong>2009</strong>;<br />
(ii) in the case of the Profit and Loss Account, of the loss of the Company for the year<br />
ended on that date; and<br />
(iii) in the case of the Cash Flow Statement, of the cash flows for the year ended on that<br />
date.<br />
For Deloitte Haskins & Sells<br />
Chartered Accountants<br />
Registration No. 117365W<br />
A. C. Khanna<br />
Place : Mumbai<br />
Partner<br />
Date : 19th February, 2010 Membership No.: 17814<br />
ANNEXURE REFERRED TO IN PARAGRAPH 3 OF THE AUDITORS’ REPORT TO THE<br />
MEMBERS OF CHEMTREAT COMPOSITES INDIA PRIVATE LIMITED ON THE FINANCIAL<br />
STATEMENTS FOR THE YEAR ENDED DECEMBER 31, <strong>2009</strong><br />
(i) (a) The Company has maintained proper records showing full particulars including<br />
quantitative details and situation of fixed assets.<br />
(b) The Company has a programme of physical verification of Fixed assets. As per the said<br />
programme, certain assets were physically verified during the last year. In our opinion,<br />
the frequency of verification is reasonable having regard to the size of the Company<br />
and the nature of its assets. According to the information and explanations given to<br />
us, no material discrepancies were noticed on such verification.<br />
(c) As per information and explanations given to us, there are no fixed assets disposed<br />
off during the year. Therefore, the provisions of clause 4 (i)(c) of the Order are not<br />
applicable to the Company.<br />
(ii) (a) The Inventories have been physically verified during the year by the management. In<br />
our opinion, the frequency of verification is reasonable.<br />
(b) In our opinion, the procedures of physical verification of the inventories followed by<br />
the management are reasonable and adequate in relation to the size of the Company<br />
and the nature of its business.<br />
(c) In our opinion and according to the information and explanations given to us, the<br />
Company is maintaining proper records of inventory. The discrepancies noticed on<br />
verification between the physical stocks and the book records were not material and<br />
have been properly dealt with in the books of account.<br />
(iii) (a) According to the information and explanations given to us, the Company has not<br />
granted any loans, secured or unsecured, to companies, firms or other parties covered<br />
in the register maintained under Section 301 of the Companies Act, 1956. Accordingly,<br />
sub-clauses (b), (c) and (d) are not applicable.<br />
(b) According to the information and explanations given to us, the Company has not taken<br />
any loans, secured or unsecured, from companies, firms or other parties covered in<br />
the register maintained under Section 301 of the Companies Act, 1956. Accordingly,<br />
sub-clauses (f) and (g) are not applicable.<br />
(iv) In our opinion and according to the information and explanations given to us, having regard to<br />
the explanations that certain items purchased / sold are of special nature for which suitable<br />
alternative sources do not exist for obtaining comparative quotations, there are adequate<br />
internal control systems commensurate with the size of the Company and the nature of its<br />
business with regard to purchase of inventory and fixed assets and for the sale of goods.<br />
Further, on the basis of our examination of the books and records of the Company carried<br />
out in accordance with the auditing standards generally accepted in India and according to<br />
the information and explanations given to us, we have neither come across nor have been<br />
informed of any continuing failure to correct major weaknesses in the aforesaid internal<br />
control system.<br />
(v) (a) In our opinion and according to the information and explanations given to us, there<br />
have been no contracts or arrangements referred to in Section 301 of the Act during<br />
the year to be entered in the register required to be maintained under Section 301 of<br />
the Companies Act, 1956.<br />
(b) Sub-clause (b) is not applicable.<br />
(vi) In our opinion and according to the information and explanations given to us, the Company<br />
has not accepted any deposits from the public within the meaning of Section 58A and<br />
58AA or any other relevant provisions of the Companies Act, 1956 and the Companies<br />
(Acceptance of Deposits) Rules 1975. Therefore, the provisions of clause 4 (vi) of the Order<br />
are not applicable to the Company.<br />
(vii) The Company does not have an internal audit system; however the internal control systems<br />
are comensurate with the size and the nature of its business.<br />
(viii) We are informed that the Central Government has not prescribed maintenance of cost records<br />
under Section 209(1)(d) of the Companies Act, 1956 in respect of the Company's business.<br />
Therefore, the provisions of clause 4 (viii) of the Order are not applicable to the Company<br />
(ix) (a) According to the records of the Company, Provident Fund, Investor Education<br />
and Protection Fund, Employees’ State Insurance, Income tax, Sales tax,<br />
Wealth tax, Service tax, Customs duty, Excise duty, cess and other material statutory<br />
dues applicable to it have been generally regularly deposited during the reporting<br />
period with the appropriate authorities.<br />
According to the information and explanations given to us, no undisputed amounts<br />
payable in respect of above were in arrears, as at December 31, <strong>2009</strong> for a period of<br />
more than six months from the date they became payable.<br />
(b) According to the information and explanations given to us and the records of the<br />
Company examined by us, there are no dues of income tax, sales tax, wealth tax,<br />
service tax, customs duty, excise duty and cess that have not been deposited on<br />
account of any dispute.<br />
(x) In our opinion, the accumulated losses of the company are less than fifty percent of its<br />
networth and it has incurred cash losses during the year covered by our audit and also in<br />
the immediately preceding financial year.<br />
(xi) In our opinion and according to the information and explanations given to us, there were no<br />
borrowings or dues payable to any financial institution or bank or debenture holders during<br />
the reporting year.<br />
(xii) Based on our examination of the records and the information and explanations given to us,<br />
the Company has not granted any loans and advances on the basis of security by way of<br />
pledge of shares, debentures and other securities. Therefore, the provisions of clause 4 (xii)<br />
of the Order are not applicable to the Company.<br />
(xiii) In our opinion, the Company is not a chit fund or nidhi/mutual benefit fund/<br />
society. Therefore the provisions of clause 4 (xiii) of the Order are not applicable to<br />
the Company.<br />
(xiv) In our opinion the Company is not dealing in or trading in shares, securities, debentures<br />
and other investments. Accordingly, the provisions of clause 4 (xiv) of the Order are not<br />
applicable to the Company.<br />
(xv) In our opinion and according to the information and explanations given to us, the<br />
Company has not given any guarantee for loans taken by others from banks or financial<br />
institutions. Accordingly, the provisions of clause 4 (xv) of the Order are not applicable to<br />
the Company.<br />
(xvi) In our opinion and according to the information and explanations given to us, there are no<br />
term loans raised during the year under audit and hence, the provisions of clause 4 (xvi) of<br />
the Order are not applicable to the Company.<br />
(xvii)<br />
According to the information and explanations given to us and on an overall examination of<br />
the balance sheet of the Company, we report that funds raised on short-term of Rs. 52,692<br />
(‘000) have been used for long-term investment.<br />
(xviii) According to the information and explanations given to us, the Company has not made<br />
any preferential allotment of shares to parties and Companies covered in the register<br />
maintained under Section 301 of the Companies Act, 1956.<br />
(xix) The Company has not issued any secured debentures. Therefore, the provisions of clause 4<br />
(xix) of the Order are not applicable to the Company.<br />
(xx)<br />
(xxi)<br />
The Company has not raised any money by public issue during the year. Therefore, the<br />
provisions of clause 4 (xx) of the Order are not applicable to the Company.<br />
According to the information and explanations furnished by the management, which have<br />
been relied upon by us, no fraud on or by the Company has been noticed or reported to/by<br />
management during course of our audit.<br />
For Deloitte Haskins & Sells<br />
Chartered Accountants<br />
Registration No. 117365W<br />
A. C. Khanna<br />
Place : Mumbai<br />
Partner<br />
Date : 19th February, 2010 Membership No.: 17814
61<br />
Balance Sheet<br />
as at 31st December, <strong>2009</strong><br />
Profit and Loss Account<br />
for the year ended 31st December, <strong>2009</strong><br />
Schedule<br />
31-12-09<br />
Rs. '000<br />
31-12-08<br />
Rs. '000<br />
SOURCES OF FUNDS<br />
Shareholders' funds<br />
Share capital 1 5,000 5,000<br />
Reserves and surplus 2 4,956 6,048<br />
9,956 11,048<br />
Loan funds<br />
Unsecured loans 3 66,000 63,000<br />
75,956 74,048<br />
APPLICATION OF FUNDS<br />
Fixed assets 4<br />
Gross block 82,039 79,811<br />
Less : Accumulated depreciation 21,686 14,774<br />
Net block 60,353 65,037<br />
Capital work-in-progress and advances, etc. 2,295 2,561<br />
62,648 67,598<br />
Current assets, loans and advances<br />
Inventories 5 9,921 8,757<br />
Sundry debtors 6 2,952 953<br />
Cash and bank balances 7 1,639 7,964<br />
Loans and advances 8 1,656 726<br />
16,168 18,400<br />
Less : Current liabilities<br />
Liabilities 9 7,007 11,950<br />
7,007 11,950<br />
Net current assets 9,161 6,450<br />
Profit and loss account 4,147 –<br />
75,956 74,048<br />
Notes on Balance Sheet and Profit and Loss<br />
Account 14<br />
INCOME<br />
Schedule<br />
<strong>2009</strong><br />
Rs. '000<br />
2008<br />
Rs. '000<br />
Sales – Gross 30,213 38,487<br />
Less : Excise duty 362 –<br />
Sales – Net 29,851 38,487<br />
Other income 10 3,235 2,220<br />
EXPENDITURE<br />
33,086 40,707<br />
Cost of materials 11 3,540 11,619<br />
Interest Paid 12 45 –<br />
Depreciation 4 6,912 6,816<br />
Other expenditure 13 27,828 32,424<br />
38,325 50,859<br />
LOSS BEFORE TAXATION (5,239) (10,152)<br />
Provision for taxation<br />
Deferred tax – (6,345)<br />
LOSS AFTER TAXATION (5,239) (3,807)<br />
Balance brought forward from<br />
previous year 1,092 4,899<br />
Balance carried to the balance sheet (4,147) 1,092<br />
Notes on Balance Sheet and Profit and Loss<br />
Account 14<br />
Basic and Diluted earnings per share<br />
(Rupees)<br />
Face value per share<br />
(Rupees)<br />
(10.48) (7.61)<br />
10.00 10.00<br />
Per our report attached<br />
For and on behalf of the Board<br />
For Deloitte Haskins & Sells P. Palm Director<br />
Chartered Accountants<br />
A. C. Khanna<br />
Partner<br />
B. L. Gaggar Director<br />
Mumbai, 19th February, 2010 Mumbai, 19th February, 2010
62 Chemtreat Composites India Private Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
Cash Flow Statement<br />
for the year ended 31st December, <strong>2009</strong><br />
Schedules<br />
forming part of the Balance Sheet<br />
<strong>2009</strong><br />
Rs. '000<br />
2008<br />
Rs. '000<br />
A. CASH FLOW FROM OPERATING ACTIVITIES :<br />
Net Loss before taxation (5,239) (10,152)<br />
Adjustments for :<br />
Depreciation 6,912 6,816<br />
Unrealised foreign exchange (gain)/ loss (Net) 35 25<br />
VAT setoff admissible written-off – 2,822<br />
Service tax recoverable written off – 1,228<br />
Interest expenses 45 –<br />
Assets written-off – 235<br />
Operating profit before working capital changes 1,753 974<br />
Adjustments for :<br />
Trade and other receivables (2,964) 699<br />
Inventories (1,164) 9,802<br />
Trade, other payables and provisions (4,943) (5,849)<br />
Cash used in operations (7,318) 5,626<br />
Direct taxes paid- (Net of refunds) – (13)<br />
Net cash used in operating activities (7,318) 5,613<br />
B. CASH FLOW FROM INVESTING ACTIVITIES :<br />
Purchase of fixed assets (1,962) (6,156)<br />
Net Cash used in investing activities (1,962) (6,156)<br />
C. CASH FLOW FROM FINANCING ACTIVITIES :<br />
Loan received from Holding Company 3,100 7,500<br />
Loans repaid to Holding Company (100) –<br />
Interest paid (45) –<br />
Net Cash from financing activities 2,955 7,500<br />
Net increase in cash and cash equivalents (A+B+C) (6,325) 6,957<br />
Cash and cash equivalents as at beginning of the year 7,964 1,007<br />
Cash and cash equivalents as at the end of the year<br />
(Refer Schedule 7) 1,639 7,964<br />
Notes :<br />
1. The Cash flow has been prepared under the "Indirect Method" as set out in Accounting<br />
Standard-3 on Cash flow statement notified by the Companies (Accounting Standards)<br />
Rules, 2006.<br />
2. Direct taxes paid are treated as arising from operating activities and are not bifurcated<br />
between investing and financing activities.<br />
3. Figures for the previous year have been regrouped wherever necessary to conform to<br />
the current year's classification.<br />
Per our report attached to the Balance Sheet For and on behalf of the Board<br />
For Deloitte Haskins & Sells P. Palm Director<br />
Chartered Accountants<br />
A. C. Khanna B. L. Gaggar Director<br />
Partner<br />
Mumbai, 19th February, 2010 Mumbai, 19th February, 2010<br />
SCHEDULE 1 : SHARE CAPITAL 31-12-09<br />
Rs. '000<br />
31-12-08<br />
Rs. '000<br />
Authorised<br />
5,00,000 Equity shares of Rs. 10/- each 5,000 5,000<br />
Issued and subscribed<br />
5,00,000 Equity shares of Rs. 10/- each fully paid up 5,000 5,000<br />
Notes :<br />
Of the above :<br />
(a) The entire issued equity share capital is held by <strong>Clariant</strong> Chemicals (India) Limited, the<br />
holding company, ultimate holding company being <strong>Clariant</strong> AG, Switzerland.<br />
(b) 296,400 equity shares of Rs. 10/- each, were allotted as fully paid up bonus shares by<br />
capitalisation of Rs. 2,964,000 from Securities premium account.<br />
SCHEDULE 2 : reserves and surplus 31-12-09<br />
Rs. '000<br />
31-12-08<br />
Rs. '000<br />
Securities premium account<br />
As per last Balance sheet 4,956 4,956<br />
Profit and loss account – 1,092<br />
4,956 6,048<br />
SCHEDULE 3 : UNSECURED LOANS 31-12-09<br />
Rs. '000<br />
Demand loan (Interest free)<br />
31-12-08<br />
Rs. '000<br />
From the holding company 66,000 63,000<br />
66,000 63,000<br />
SCHEDULE 4 : FIXED ASSETS Rs. '000<br />
GROSS BLOCK DEPRECIATION NET BLOCK<br />
As at<br />
31-12-2008<br />
Additions Deductions As at<br />
31-12-<strong>2009</strong><br />
As at<br />
31-12-2008<br />
Deductions For the<br />
year<br />
As at<br />
31-12-<strong>2009</strong><br />
As at<br />
31-12-<strong>2009</strong><br />
As at<br />
31-12-2008<br />
Tangible Assets<br />
Land freehold 884 – – 884 – – – – 884 884<br />
Buildings 12,161 – – 12,161 410 – 198 608 11,553 11,751<br />
Plant, machinery, equipment etc. 64,949 2,219 – 67,168 14,176 – 6,617 20,793 46,375 50,773<br />
Furniture, fixtures and office appliances 1,817 9 – 1,826 188 – 97 285 1,541 1,629<br />
Total 79,811 2,228 – 82,039 14,774 – 6,912 21,686 60,353<br />
Previous year 76,447 3,663 299 79,811 8,022 64 6,816 14,774 65,037<br />
Capital work-in-progress 785 1,885<br />
Advances against capital orders 1,510 676<br />
2,295 2,561<br />
62,648 67,598
63<br />
Schedules<br />
forming part of the Balance Sheet<br />
SCHEDULE 5 : INVENTORIES 31-12-09<br />
Rs. '000<br />
31-12-08<br />
Rs. '000<br />
At lower of cost and net realisable value<br />
(As certified by the Management)<br />
Stores and spare parts 616 715<br />
Raw materials 4,611 5,863<br />
Packing materials 52 40<br />
Finished goods 4,364 2,139<br />
Work-in-progress 278 –<br />
9,921 8,757<br />
SCHEDULE 6 : SUNDRY DEBTORS 31-12-09<br />
Rs. '000<br />
Unsecured – Considered good<br />
31-12-08<br />
Rs. '000<br />
Over six months 222 –<br />
Other debts 2,730 953<br />
[includes Rs. Nil; Previous Year Rs. 26 ('000) due from holding<br />
Company]<br />
2,952 953<br />
SCHEDULE 7 : CASH AND BANK BALANCES 31-12-09<br />
Rs. '000<br />
31-12-08<br />
Rs. '000<br />
Cash on hand 1 3<br />
With Scheduled Banks :<br />
On current accounts 1,638 7,961<br />
1,639 7,964<br />
SCHEDULE 8 : LOANS AND ADVANCES 31-12-09<br />
Rs. '000<br />
(Unsecured – considered good, unless otherwise stated)<br />
31-12-08<br />
Rs. '000<br />
Advances recoverable in cash or in kind or for value to be<br />
received 820 463<br />
VAT set off admissible 522 –<br />
Advance payment of Income tax (Net of provision for taxation) 44 44<br />
Balances with customs and excise on current account 270 219<br />
1,656 726<br />
SCHEDULE 9 : CURRENT LIABILITIES 31-12-09<br />
Rs. '000<br />
Sundry creditors<br />
31-12-08<br />
Rs. '000<br />
Due to micro enterprises and small enterprises – –<br />
(See Note 6, Schedule 14)<br />
Due to holding company 2,835 7,973<br />
Due to others 4,172 3,977<br />
7,007 11,950<br />
Schedules<br />
forming part of the Profit and Loss Account<br />
SCHEDULE 10 : OTHER INCOME <strong>2009</strong><br />
Rs. '000<br />
2008<br />
Rs. '000<br />
Exchange Gain (Net) – 1,434<br />
Income from Services rendered 980 –<br />
Sale of By-Product 114 183<br />
[excluding Excise Duty Rs. 18 ('000); Previous Year Rs. 29 ('000)]<br />
Sale of Packing Materials to Holding Company – 20<br />
Sale of Waste/Scrap Materials – 204<br />
Sundry Credit Balances Written back – 242<br />
Insurance Claim 2,001 –<br />
Miscellaneous income 140 137<br />
3,235 2,220<br />
SCHEDULE 11 : COST OF MATERIALS <strong>2009</strong><br />
Rs. '000<br />
2008<br />
Rs. '000<br />
Raw materials<br />
Opening Stock 5,863 8,525<br />
Purchases 4,444 1,645<br />
Less : Closing stock (4,611) (5,863)<br />
Raw material Consumption 5,696 4,307<br />
Packing materials<br />
Opening Stock 40 48<br />
Purchases 359 257<br />
Less : Closing stock (52) (40)<br />
Packing material Consumption 347 265<br />
Finished goods<br />
Opening Stock 2,139 8,975<br />
Less : Closing stock (4,364) (2,139)<br />
(2,225) 6,836<br />
Work-in-progress<br />
Opening Stock – 211<br />
Less : Closing stock (278) –<br />
(278) 211<br />
3,540 11,619<br />
SCHEDULE 12 : INTEREST PAID <strong>2009</strong><br />
Rs. '000<br />
2008<br />
Rs. '000<br />
Interest Paid<br />
Others 45 –<br />
45 –<br />
SCHEDULE 13 : OTHER EXPENDITURE <strong>2009</strong><br />
Rs. '000<br />
2008<br />
Rs. '000<br />
Stores and Spare parts etc. consumed 642 871<br />
Repairs and maintenance :<br />
Plant and machinery 489 987<br />
Others * 1,188 1,147<br />
Power and fuel 2,140 2,043<br />
Rates and taxes (including water charges) 387 106<br />
Insurance * 13 82<br />
Clearing, forwarding and transport * 2,828 4,316<br />
Personnel Cost * 8,394 9,441<br />
Travelling and conveyance * 2,567 2,802<br />
Commission 401 –<br />
Legal, professional & consultancy (See Note 8, Schedule 14) 2,551 3,237<br />
Assets written-off – 235<br />
Excise duty 201 161<br />
Exchange loss (Net) 629 –<br />
Personnel protection and safety expense 1,185 1,039<br />
Labour charges * 2,000 1,152<br />
IT related cost * 1,474 162<br />
VAT Set off Admissible Written off – 2,822<br />
Service Tax Recoverable written off – 1,228<br />
Miscellaneous * 739 593<br />
27,828 32,424<br />
* See Note 17, Schedule 14
64 Chemtreat Composites India Private Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
Notes<br />
schedule 14 : Notes on the Balance Sheet and Profit and Loss Account for the year ended 31st December, <strong>2009</strong><br />
1. Significant Accounting Policies<br />
The financial statements are prepared at historical cost on the accrual basis of<br />
accounting and in accordance with the standards on accounting notified by the<br />
Companies (Accounting Standards) Rules, 2006 and referred to in Section 211(3C) of<br />
the Companies Act, 1956.<br />
The significant accounting policies are as follows :<br />
I. Revenue Recognition<br />
The Company recognises sale of goods on transfer of significant risks and<br />
rewards of ownership of the goods to the buyer. Sales are net of excise duty,<br />
sales tax and trade discounts, wherever applicable.<br />
Dividend income on investments is accounted for when the right to receive the<br />
payment is established.<br />
II.<br />
Excise Duty<br />
Excise duty payable on products is accounted for at the time of dispatch of goods<br />
from the factories but is accrued for stocks held at the year end.<br />
Excise Duty related to the difference between the closing stock and opening<br />
stock of finished goods has been recognized separately in the profit and loss<br />
account under schedule of ‘Other Expenditure’.<br />
IX.<br />
(B) The current tax, if any, is determined as the amount of tax payable in respect<br />
of the estimated taxable income for the period.<br />
(C) The deferred tax charge or credit is recognised, using prevailing enacted or<br />
substantively enacted tax rates. Where there are unabsorbed depreciation<br />
or carry forward losses, deferred tax assets are recognised only if there is<br />
virtual certainty of realisation of such assets. Other deferred tax assets are<br />
recognised only to the extent there is reasonable certainty of realisation in<br />
future. Deferred tax assets/liabilities are reviewed at each Balance Sheet<br />
date based on developments during the reporting period and available case<br />
laws, to reassess realization/liabilities.<br />
Provisions/Contingencies<br />
Provision is recognised when the Company has a present obligation as a result<br />
of past event; it is probable that an outflow of resources embodying economic<br />
benefit will be required to settle the obligation, in respect of which a reliable<br />
estimate can be made. Provisions are not discounted to its present value and<br />
are determined based on best estimate of the expenditure required to settle the<br />
obligation at the Balance Sheet date. These are reviewed at each Balance Sheet<br />
date and adjusted to reflect the current best estimate. A contingent liability<br />
is disclosed, unless the possibility of an outflow of resources embodying the<br />
economic benefit is remote.<br />
III.<br />
IV.<br />
Employee Benefits/Leave Encashment<br />
As there are no permanent employees of the Company, no provision for employee<br />
benefits/leave encashment is required to be made.<br />
Fixed Assets and Depreciation<br />
(A) All fixed assets are stated at cost less accumulated depreciation.<br />
(B) The cost comprises the purchase price and any other attributable cost of<br />
bringing the asset to its working condition for its intended use.<br />
(C) Depreciation on the fixed asset is provided on the straight line method at<br />
the rates and in the manner specified in Schedule XIV of the Companies Act,<br />
1956, except for:<br />
(a) Plant, machinery and equipment (except Laboratory equipment, Fire<br />
Fighting and Weighing Machine) over their useful life of 10 Years as<br />
determined by the Company on a Straight Line Basis.<br />
(c) Computers and Printers on which 25% straight line method is applied.<br />
V. Inventories<br />
Inventories are valued at the lower of cost and estimated net realisable value<br />
after providing for obsolescence. The cost of inventories is generally arrived at<br />
on the following bases :<br />
Raw materials, packing materials,<br />
trading items and store and spares : Weighted average cost<br />
Finished goods and work-in-progress : Absorption costing at works cost<br />
VI. Sundry Debtors/Loans and Advances<br />
Sundry debtors and loans and advances are stated after making adequate<br />
provision for doubtful debts/advances, if any.<br />
VII.<br />
Foreign Currency Translations<br />
(A) Foreign currency transactions are accounted at the rate prevailing on the<br />
date of transaction.<br />
(B) Monetary items denominated in foreign currency, are translated at the<br />
exchange rate prevailing on the last day of the reporting period.<br />
(C) Non-monetary items other than fixed assets, which are carried in terms of<br />
historical cost denominated in a foreign currency, are reported using the<br />
exchange rate at the date of transaction.<br />
(D) Gain or loss arising out of translation/conversion is taken credit for or<br />
charged to the Profit and Loss Account.<br />
VIII. Income Tax<br />
(A) Income-tax expense comprises current tax and deferred tax charge or<br />
credit.<br />
2. Segment Information for the year ended 31st December, <strong>2009</strong> (As required by<br />
Accounting Standard (AS) - 17 Segment <strong>Report</strong>ing)<br />
(a) The Company operates in only one primary business segment of Speciality<br />
Chemicals i.e. manufacturing synthetic resins Consequently, disclosure for<br />
primary segment under AS 17 – Segment <strong>Report</strong>ing is not applicable to the<br />
Company.<br />
(b) The secondary segments of the Company are geographical segments mainly :<br />
(i) India<br />
(ii) Outside India<br />
Information about Secondary Segments :<br />
India<br />
<strong>2009</strong><br />
Rs’000<br />
Outside<br />
India<br />
Total<br />
2008<br />
Rs’000<br />
India Outside<br />
India<br />
Total<br />
External sales 4,335 25,516 29,851 – 38,487 38,487<br />
Segment assets 76,309 2,463 78,772 85,027 927 85,954<br />
Additions to fixed assets 1,962 – 1,962 6,156 – 6,156<br />
Note : Total assets exclude the Advance payment of Income Tax Rs. 44 (‘000)<br />
[Previous year Rs. 44 (‘000)].<br />
3. Related Party Disclosure as required by AS-18 “Related Party Disclosures”<br />
are given below :<br />
A. Relationship :<br />
(a) Holding Company :<br />
<strong>Clariant</strong> Chemicals (India) Limited, holds 100% equity shares in the<br />
Company.<br />
EBITO Chemiebeteiligungen AG, <strong>Clariant</strong> International AG and <strong>Clariant</strong><br />
Participations AG together hold 63.40% equity shares in the <strong>Clariant</strong><br />
Chemicals (India) Limited, The ultimate holding company is <strong>Clariant</strong> AG,<br />
Switzerland.<br />
(b) Other related parties in the <strong>Clariant</strong> group where common control<br />
exists and with whom the company has transactions :<br />
<strong>Clariant</strong> Advanced Materials GmbH <strong>Clariant</strong> Life Science Molecules<br />
(Florida) Inc.<br />
<strong>Clariant</strong> Corporation<br />
Kion Specialty Polymers<br />
<strong>Clariant</strong> (Japan) KK<br />
(c) Key Management Personnel :<br />
H. J. Meier – Director (upto December 31, <strong>2009</strong>).
Notes<br />
65<br />
B. During the year following transactions were entered into with related parties :<br />
Name of party Year Sale of<br />
Goods<br />
Purchase<br />
of goods<br />
Services<br />
received<br />
Purchase<br />
of Fixed<br />
Assets<br />
Loans<br />
taken<br />
Loans<br />
Repaid<br />
Amount<br />
Payable at the<br />
year end #<br />
Rs. '000<br />
Amount<br />
receivable at the<br />
year end<br />
<strong>Clariant</strong> Chemicals (India) Ltd. <strong>2009</strong> – – 11,594 – 3,100 100 68,835 –<br />
2008 * 20 48 11,500 2,176 7,500 – 70,973 26<br />
<strong>Clariant</strong> Advanced Material GmbH <strong>2009</strong> 7,364 – – – – – – 2302<br />
2008 17,243 – – – – – – 910<br />
<strong>Clariant</strong> (Japan) KK <strong>2009</strong> 3221 – – – – – – 68<br />
2008 256 – – – – – – 17<br />
Kion Specialty Polymers <strong>2009</strong> – – – – – – – –<br />
2008 7,242 – – – – – – –<br />
<strong>Clariant</strong> Corporation <strong>2009</strong> 8188 – – – – – – –<br />
2008 9,021 – – – – – – –<br />
<strong>Clariant</strong> Life Science Molecules (Florida) Inc. <strong>2009</strong> – 1200 – – – – – –<br />
2008 – – – – – – – –<br />
# Included in Unsecured Loan Rs. 66,000 ('000); [Previous Year Rs. 63,000 ('000)], Sundry Creditors Rs. 2,835 ('000); [Previous Year Rs.7,973 ('000)] .<br />
* Sale of packing material.<br />
31-12-<strong>2009</strong><br />
Rs. '000<br />
31-12-2008<br />
Rs. '000<br />
4. Estimated amount of contracts remaining to be<br />
executed on capital account and not provided<br />
for (Net of advances) 4,490 5,325<br />
5. Deferred taxes :<br />
During the year ended 31st December <strong>2009</strong>, the<br />
Company has incurred losses resulting in unabsorb<br />
carry forward tax losses. The Company is eligible for<br />
a tax holiday under section 10B of the Indian Incometax<br />
Act, 1961. Though the management is confident<br />
of generating profits in the future, there is currently<br />
no convincing evidence of virtual certainty that the<br />
Company would reverse the tax loss carry forward<br />
beyond the tax holiday period. Accordingly the<br />
Company has not recognised any deferred tax assets<br />
resulting from the carry forward tax losses. Further,<br />
deffered tax liability on account of timing differences<br />
in case of depreciation does not arise by virtue of<br />
explanation 6 to Sec. 43 (6) of the Indian Incometax<br />
Act, 1961 where the book depreciation shall be<br />
deemed to be the depreciation actually allowed under<br />
the Income-tax Act.<br />
6. Disclosure required under the Micro, Small<br />
and Medium Enterprises Development Act, 2006<br />
(the Act) are given as follows :<br />
(a) Principal amount due — —<br />
Interest due on the above — —<br />
(b) Interest paid during the year beyond the appointed<br />
day — —<br />
(c) Amount of interest due and payable for the period<br />
of delay in making payment without adding the<br />
interest specified under the Act — —<br />
(d) Amount of interest accrued and remaining unpaid<br />
at the end of the year — —<br />
(e) Amount of further interest remaining due and<br />
payable even in the succeeding years, untill such<br />
date when the interest dues as above are actually<br />
paid to the small enterprise for the purpose of<br />
disallowance as a deductible expenditure under<br />
section 23 of the Act — —<br />
The above information and that given in<br />
Schedule- 9 'Liabilities' regarding micro enterprise and<br />
small enterprises has been determined on the basis<br />
of information available with the Company. This has<br />
been relied upon by the auditors.<br />
7. Earnings per share :<br />
(a) Net loss after taxation (Rupees '000) (5,239) (3,807)<br />
(b) Number of equity shares outstanding 500,000 500,000<br />
(c) Basic and Diluted loss per share (In Rupees) (10.48) (7.61)<br />
(d) Face value per share (In Rupees) 10 10<br />
31-12-<strong>2009</strong><br />
Rs. '000<br />
31-12-2008<br />
Rs. '000<br />
8. Legal, professional & consultancy in Schedule<br />
13 : Other expenditure include :<br />
Audit fees and fees for other services : (Excluding<br />
service tax)<br />
(a) Audit fees 300 300<br />
(b) Other services 300 525<br />
600 825<br />
9. Capacity and production :<br />
Class of goods<br />
<strong>Annual</strong><br />
Installed<br />
Capacity<br />
M. Tonnes<br />
<strong>2009</strong> 2008<br />
Production*<br />
M. Tonnes<br />
<strong>Annual</strong><br />
Installed<br />
Capacity<br />
M. Tonnes<br />
Production*<br />
M. Tonnes<br />
Synthetic Resins 750.000 16.253 750.000 10.675<br />
* Excluding captive consumption and recovered solvents 5.44 M.Tonnes.<br />
Notes :<br />
1. The classification between the class of goods and the installed capacity have been<br />
certified by the Director on which the auditors have placed reliance, this being a<br />
technical matter.<br />
2. Licensed capacity per annum not indicated due to the abolition of Industrial<br />
Licenses as per Notification No. 477(E) dated 25th July, 1991 issued under The<br />
Industries (Development and Regulations) Act 1951.<br />
10. Sales , Opening and Closing Stock :<br />
Class of goods Opening Stock Closing Stock Sales<br />
(Inclusive of excise<br />
duty)<br />
Quantity<br />
M. Tonnes<br />
Value Quantity*<br />
Rs. ‘000 M. Tonnes<br />
Value Quantity**<br />
Rs. ‘000 M. Tonnes<br />
Value<br />
Rs. ‘000<br />
Synthetic Resins 2.617 2,139 9.298 4,364 9.034 30,213<br />
(8.054) (8,975) (2.617) (2,139) (16.069) (38,487)<br />
** Excludes free samples 0.091 M. Tonnes (Previous Year 0.037 M. Tonnes) and<br />
material lost in transit 0.369 M. Tonnes (Previous Year Nil).<br />
* Excludes write-off 0.078 M.Tonnes (Previous Year 0.006 M. Tonnes).<br />
11. Raw Materials consumed :<br />
Quantity<br />
M.Tonnes<br />
<strong>2009</strong> 2008<br />
Value<br />
Rs. ‘000<br />
Quantity<br />
M.Tonnes<br />
Value<br />
Rs. ‘000<br />
(a) Silanes 25.137 4,696 4.811 2,855<br />
(b) Others * 1,000 1,452<br />
5,696 4,307<br />
* None of the items individually exceed 10% of the total value of raw materials<br />
consumed
66 Chemtreat Composites India Private Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
12. Consumption of raw materials :<br />
<strong>2009</strong> 2008<br />
% of total Value % of total<br />
Consumption Rs. ‘000 Consumption<br />
Value<br />
Rs. ‘000<br />
(a) Raw materials :<br />
Imported 47.15 2,686 46.46 2,001<br />
Indigenous 52.85 3,010 53.54 2,306<br />
100.00 5,696 100.00 4,307<br />
(b) Components and spare parts referred to in Paragraph 4D (c ) of Schedule VI of the<br />
Companies Act, 1956 are assumed to be incorporated in the goods produced and<br />
not those used for maintenance of plant and machinery.<br />
13. Disclosure in respect of Derivative Instruments :<br />
(a) During the year, the Company has not used any derivative Instruments to hedge its<br />
exposure in foreign currency.<br />
(b) Foreign currency exposures not covered by a derivative instrument.<br />
Amount receivable on account of export of goods and services.<br />
31-12-<strong>2009</strong> 31-12-2008<br />
Currency Amount in Rs. ‘000 Amount in Rs. ‘000<br />
foreign currency<br />
foreign currency<br />
USD 3,450 161 – –<br />
EUR 34,248 2,302 13,549 927<br />
2,463 927<br />
31-12-<strong>2009</strong><br />
Rs. '000<br />
31-12-2008<br />
Rs. '000<br />
14. Value of imports (C.I.F.) :<br />
Raw materials 1,458 –<br />
15. Earnings in foreign exchange :<br />
(a) Exports (F.O.B.) 23,903 35,604<br />
(b) Insurance and freight 1,613 2,883<br />
(c) Exchange gain (net) – 1,434<br />
Statement pursuant to Part IV of Schedule VI to The Companies Act, 1956<br />
Balance Sheet Abstract and Company’s General Business Profile<br />
31-12-<strong>2009</strong><br />
Rs. '000<br />
31-12-2008<br />
Rs. '000<br />
16. Expenditure in foreign currency :<br />
(a) Exchange Loss (net) 629 –<br />
(b) Product registration fee 169 –<br />
17. The Company has entered in to a cost sharing<br />
agreement dated 30th May, 2006 with the holding<br />
company for reimbursement of costs and accordingly<br />
expenses of Rs. 11,594 (‘000) [Previous Year :<br />
Rs. 11,500 (‘000)] have been reimbursed by the Company<br />
and included in Schedule 13 : Other Expenditure under<br />
the respective expense head as follows :<br />
Expense head<br />
Personnel cost 8,080 9,143<br />
Travelling and conveyance 1,725 1,962<br />
IT related cost 1,475 162<br />
Repairs and maintenance – Others 45 32<br />
Labour charges 93 62<br />
Clearing, forwarding & transport 6 –<br />
Miscellaneous expenses 170 139<br />
Total 11,594 11,500<br />
18. Figures for the previous year have been regrouped wherever necessary to conform to<br />
the current year’s classification.<br />
For and on behalf of the Board<br />
P. Palm Director<br />
B. L. Gaggar Director<br />
Mumbai, 19th February, 2010<br />
I. Registration Details<br />
Registration No. 1 1 – 4 3 2 3 5 State Code 1 1<br />
II.<br />
III.<br />
Balance Sheet Date 3 1 – 1 2 – 2 0 0 9<br />
Date Month Year<br />
Capital raised during the year (Amount in Rs. Thousands)<br />
Public Issue N I L Right Issue N I L<br />
Bonus Issue N I L Private Placement N I L<br />
Position of Mobilisation and Deployment of Funds (Amount in Rs. Thousands)<br />
Total Liabilities* 8 2 9 6 3 Total Assets 8 2 9 6 3<br />
Sources of Funds<br />
Paid-up Capital 5 0 0 0 Reserves and Surplus 4 9 5 6<br />
Secured Loans N I L Unsecured Loans 6 6 0 0 0<br />
Application of Funds<br />
Net Fixed Assets 6 2 6 4 8 Investments N I L<br />
Net Current Assets 9 1 6 1 Miscellaneous Expenditure N I L<br />
IV.<br />
Accumulated Losses 4 1 4 7<br />
*Including Shareholders’ funds<br />
Performance of Company (Amount in Rs. Thousands)<br />
Turnover (Gross Revenue) @ 3 3 0 8 6 Total Expenditure 3 8 3 2 5<br />
@ Includes Other Income Rs. 3235<br />
+ – Profit Before Tax + – Profit After Tax<br />
P 5 2 3 9 P 5 2 3 9<br />
Earnings Per Share in Rs.** ( 1 0 . 4 8 ) Dividend Rate % N I L<br />
** Earnings per share has been computed by dividing profit after tax by the total number of issued equity shares as at the year end.<br />
V. Generic Names of Three Principal Products of Company<br />
Item Code No. Product Description 3 9 1 0 0 0 1 0 – C L A R I A N T K I O N M L 3 3 / C 12<br />
Item Code No. Product Description 3 9 1 0 0 0 1 0 – C L A R I A N T K I O N H T T 1 8 0 0<br />
Item Code No. Product Description 3 9 1 0 0 0 9 0 – T U T O P R O M M A T T H D<br />
For and on behalf of the Board<br />
P. Palm Director<br />
Mumbai, 19th February, 2010 B. L. Gaggar Director
<strong>Clariant</strong> Chemicals (India) Limited — Consolidated<br />
67<br />
Auditors‘ <strong>Report</strong> to the Members<br />
Auditors’ <strong>Report</strong> to the Board of Directors of <strong>Clariant</strong> Chemicals (India) Limited on the Consolidated Financial<br />
Statements of <strong>Clariant</strong> Chemicals (India) Limited<br />
1. We have audited the attached Consolidated Balance Sheet of<br />
<strong>Clariant</strong> Chemicals (India) Limited and its subsidiary (the <strong>Clariant</strong><br />
Chemicals (India) Limited Group), as at 31st December, <strong>2009</strong> and<br />
also the Consolidated Profit and Loss Account and the Consolidated<br />
Cash Flow Statement for the year ended on that date annexed<br />
thereto. These financial statements are the responsibility of<br />
<strong>Clariant</strong> Chemicals (India) Limited’s management. Our responsibility<br />
is to express an opinion on these financial statements based on<br />
our audit.<br />
2. We conducted our audit in accordance with the auditing<br />
standards generally accepted in India. Those Standards require<br />
that we plan and perform the audit to obtain reasonable<br />
assurance about whether the financial statements are free of<br />
material misstatement. An audit includes examining on a test<br />
basis, evidence supporting the amounts and disclosures in the<br />
financial statements. An audit also includes assessing the<br />
accounting principles used and significant estimates made by<br />
management, as well as evaluating the overall financial statement<br />
presentation. We believe that our audit provides a reasonable<br />
basis for our opinion.<br />
3. We report that the consolidated financial statements have<br />
been prepared by the <strong>Clariant</strong> Chemicals (India) Limited’s<br />
management in accordance with the requirements of Accounting<br />
Standard (AS) 21, Consolidated Financial Statements, notified by<br />
the Companies (Accounting Standards) Rules, 2006.<br />
4. In our opinion and to the best of our information and according to<br />
the explanations given to us, the attached Consolidated Financial<br />
Statements give a true and fair view in conformity with the<br />
accounting principles generally accepted in India:<br />
(i)<br />
(ii)<br />
in the case of the Consolidated Balance Sheet, of the state<br />
of affairs of the <strong>Clariant</strong> Chemicals (India) Limited Group as<br />
at 31st December, <strong>2009</strong>;<br />
in the case of the Consolidated Profit and Loss Account, of<br />
the profit of the <strong>Clariant</strong> Chemicals (India) Limited Group for<br />
the year ended on that date; and<br />
(iii) in the case of the Consolidated Cash Flow Statement,<br />
of the cash flows of the Group for the year ended on<br />
that date.<br />
Mumbai: 19th February, 2010<br />
For Deloitte Haskins & Sells<br />
Chartered Accountants<br />
Registration No. 117365W<br />
A. C. Khanna<br />
Partner<br />
Membership No.: 17814
68 <strong>Clariant</strong> Chemicals (India) Limited — Consolidated<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
Consolidated Balance Sheet<br />
as at 31st December, <strong>2009</strong><br />
Schedule<br />
31-12-09<br />
Rs. Lakhs<br />
31-12-08<br />
Rs. Lakhs<br />
SOURCES OF FUNDS<br />
Shareholders' funds<br />
Share capital 1 2666.07 2666.07<br />
Reserves and surplus 2 32061.13 29097.60<br />
34727.20 31763.67<br />
Loan funds<br />
Unsecured loans 3 204.78 309.07<br />
204.78 309.07<br />
Deferred tax liability – Net (See note 6, Schedule 17) — 254.94<br />
34931.98 32327.68<br />
APPLICATION OF FUNDS<br />
Fixed assets 4<br />
Gross block 36017.85 39816.46<br />
Less : Accumulated depreciation and impairment 21301.71 23538.07<br />
Net block 14716.14 16278.39<br />
Capital work-in-progress and advances, etc. 606.22 1072.54<br />
15322.36 17350.93<br />
Fixed assets held for disposal (See note 14, Schedule 17) 792.34 —<br />
Investments 5 12124.95 5459.47<br />
Deferred tax asset – Net (See note 6, Schedule 17) 275.72 —<br />
Current assets, loans and advances<br />
Inventories 6 7764.24 10631.55<br />
Sundry debtors 7 14489.15 13219.68<br />
Cash and bank balances 8 1713.01 921.95<br />
Loans and advances 9 5648.70 5695.75<br />
29615.10 30468.93<br />
Less : Current liabilities and provisions<br />
Liabilities 10 16614.62 12884.63<br />
Provisions 11 6583.87 8067.02<br />
23198.49 20951.65<br />
Net current assets 6416.61 9517.28<br />
34931.98 32327.68<br />
Notes on balance sheet and profit and loss account 17<br />
Per our report attached<br />
For Deloitte Haskins & Sells<br />
Chartered Accountants<br />
A. C. Khanna<br />
Partner<br />
Mumbai, 19th February, 2010<br />
For and on behalf of the Board<br />
R. A. Shah Chairman<br />
P. Palm Vice-Chairman & Managing Director<br />
Diwan A. Nanda Director<br />
B. L. Gaggar Director Finance & Company Secretary<br />
Mumbai, 19th February, 2010
69<br />
Consolidated Profit and Loss Account<br />
for the year ended 31st December, <strong>2009</strong><br />
<strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
Schedule<br />
INCOME<br />
Sales – Gross 97624.37 100529.74<br />
Less : Excise duty 5191.73 8505.81<br />
Sales – Net 92432.64 92023.93<br />
Other income 12 2663.17 2530.26<br />
95095.81 94554.19<br />
EXPENDITURE<br />
Cost of materials 13 54558.89 58265.63<br />
Personnel cost 14 6158.71 7229.91<br />
Interest (Net) 15 17.12 (18.29)<br />
Depreciation/Amortisation 4 1965.18 2319.55<br />
Impairment of fixed assets 4 136.98 728.62<br />
Other expenditure 16 14340.70 16037.79<br />
77177.58 84563.21<br />
Less : Service charges recovered 790.80 673.23<br />
76386.78 83889.98<br />
PROFIT BEFORE EXCEPTIONAL ITEMS AND TAXATION 18709.03 10664.21<br />
Exceptional items (See note 12, Schedule 17) 2450.46 48.00<br />
PROFIT AFTER EXCEPTIONAL ITEMS AND BEFORE TAXATION 16258.57 10616.21<br />
Provision for taxation<br />
Current tax 5958.00 3792.00<br />
Deferred tax (530.66) (241.74)<br />
Fringe benefit tax 39.00 118.50<br />
(Excess)/Short provision for taxation in respect of earlier years 30.77 248.09<br />
PROFIT AFTER TAXATION 10761.46 6699.36<br />
Balance brought forward from previous year 1097.45 999.35<br />
Available for Appropriation 11858.91 7698.71<br />
APPROPRIATED AS FOLLOWS<br />
General reserve 1081.36 674.83<br />
Interim dividend 2666.07 —<br />
Proposed dividend (Final) 3999.11 5065.54<br />
Corporate tax on dividend (Interim & Final) 1132.75 860.89<br />
Balance carried to the balance sheet 2979.62 1097.45<br />
11858.91 7698.71<br />
Notes on balance sheet and profit and loss account 17<br />
Basic and Diluted earnings per share (Rupees) (See note 8, Schedule 17) 40.36 25.13<br />
Face value per share (Rupees) 10.00 10.00<br />
Per our report attached to the Balance Sheet<br />
For Deloitte Haskins & Sells<br />
Chartered Accountants<br />
A. C. Khanna<br />
Partner<br />
Mumbai, 19th February, 2010<br />
For and on behalf of the Board<br />
R. A. Shah Chairman<br />
P. Palm Vice-Chairman & Managing Director<br />
Diwan A. Nanda Director<br />
B. L. Gaggar Director Finance & Company Secretary<br />
Mumbai, 19th February, 2010
70 <strong>Clariant</strong> Chemicals (India) Limited — Consolidated<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
Consolidated Cash Flow Statement<br />
for the year ended 31st December, <strong>2009</strong><br />
A. CASH FLOW FROM OPERATING ACTIVITIES :<br />
<strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
Net Profit after exceptional items and before taxation 16258.57 10616.21<br />
Adjustments for :<br />
Depreciation/Amortisation 1965.18 2319.55<br />
Impairment of fixed assets 136.98 728.62<br />
Unrealised foreign exchange (gain)/loss (Net) (32.54) 60.21<br />
Interest income (83.20) (171.67)<br />
Dividend income (407.90) (171.56)<br />
Loss/(profit) on sale of assets (Net) (80.31) (9.58)<br />
Loss/(profit) on sale of investments (Net) (0.21) (0.29)<br />
Provision for doubtful debts/advances (Net) 29.39 200.11<br />
Provision for leave encashment (126.69) 4.52<br />
Provision for ex-gratia gratuity (15.21) 4.24<br />
Provision for gratuity (186.30) 267.80<br />
Interest expenses 100.32 153.38<br />
Assets written-off 100.69 392.98<br />
Operating profit before working capital changes 17658.77 14394.52<br />
Adjustments for :<br />
Trade and other receivables (1131.92) 647.54<br />
Inventories 2867.31 825.08<br />
Trade, other payables and provisions 3695.79 (4453.14)<br />
Cash generated from operations 23089.95 11414.00<br />
Direct taxes paid – (Net of refunds) (6055.45) (3288.65)<br />
Net cash from operating activities 17034.50 8125.35<br />
B. CASH FLOW FROM INVESTING ACTIVITIES :<br />
Purchase of fixed assets (1024.62) (2719.66)<br />
Sale of fixed assets 138.31 38.63<br />
Purchase of investments (95164.44) (42571.83)<br />
Sale of investments 88499.17 39730.92<br />
Interest received 83.20 171.67<br />
Dividend received 407.90 171.56<br />
Net Cash used in investing activities (7060.48) (5178.71)
Consolidated Cash Flow Statement<br />
71<br />
C. CASH FLOW FROM FINANCING ACTIVITIES :<br />
<strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
Repayment of borrowings (104.29) (98.09)<br />
Interest paid (93.78) (147.17)<br />
Dividend/dividend tax paid (8984.89) (3109.75)<br />
Net Cash used in financing activities (9182.96) (3355.01)<br />
NET INCREASE IN CASH AND CASH EQUIVALENTS (A+B+C) 791.06 (408.37)<br />
CASH AND CASH EQUIVALENTS AS AT BEGINNING OF THE YEAR 921.95 1330.32<br />
CASH AND CASH EQUIVALENTS AS AT THE END OF THE YEAR (See note 3) (Refer Schedule 8) 1713.01 921.95<br />
Notes :<br />
1. The Cash flow has been prepared under the "Indirect Method" as set out in Accounting Standard-3 on Cash flow statement notified by the<br />
Companies (Accounting Standards) Rules, 2006.<br />
2. Direct taxes paid are treated as arising from operating activities and are not bifurcated between investing and financing activities.<br />
3. Cash and cash equivalents at the end of the year include current account balances with banks of Rs. 221.71 lakhs (Previous Year : Rs. 161.63 lakhs)<br />
which are restricted in use on account of unclaimed dividend/fixed deposit/interest on fixed deposit.<br />
4. Figures for the previous year have been regrouped wherever necessary to conform to the current year's classification.<br />
Per our report attached to the Balance Sheet<br />
For Deloitte Haskins & Sells<br />
Chartered Accountants<br />
A. C. Khanna<br />
Partner<br />
Mumbai, 19th February, 2010<br />
For and on behalf of the Board<br />
R. A. Shah Chairman<br />
P. Palm Vice-Chairman & Managing Director<br />
Diwan A. Nanda Director<br />
B. L. Gaggar Director Finance & Company Secretary<br />
Mumbai, 19th February, 2010
72 <strong>Clariant</strong> Chemicals (India) Limited — Consolidated<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
Schedules<br />
forming part of the Consolidated Balance Sheet<br />
SCHEDULE 1 : SHARE CAPITAL 31-12-09<br />
Rs. Lakhs<br />
Authorised<br />
31-12-08<br />
Rs. Lakhs<br />
30000000 equity shares of Rs. 10/- each 3000.00 3000.00<br />
Issued and subscribed<br />
26660745 equity shares of Rs. 10/- each fully paid 2666.07 2666.07<br />
Notes :<br />
Of the above :<br />
(a)<br />
(b)<br />
(c)<br />
15010745 equity shares issued as fully paid up pursuant to a contract for a consideration other than cash.<br />
8167080 equity shares are held by EBITO Chemiebeteiligungen AG.<br />
6075000 equity shares are held by <strong>Clariant</strong> International AG.<br />
2660000 equity shares are held by <strong>Clariant</strong> Participations AG.<br />
The ultimate holding company being <strong>Clariant</strong> AG, Switzerland.<br />
6690610 equity shares were allotted as fully paid up bonus shares by capitalisation of Rs. 669.06 lakhs from general reserve.<br />
SCHEDULE 2 : RESERVES AND SURPLUS 31-12-09<br />
Rs. Lakhs<br />
Capital reserve<br />
31-12-08<br />
Rs. Lakhs<br />
As per last Balance sheet 730.11 730.11<br />
Capital redemption reserve<br />
As per last Balance sheet 137.50 137.50<br />
Securities premium account<br />
As per last Balance sheet 3545.65 3545.65<br />
Investment allowance reserve<br />
As per last Balance sheet 20.00 20.00<br />
Less : Transfer to General Reserve 20.00 —<br />
— 20.00<br />
General reserve<br />
As per last Balance sheet 23566.89 22892.06<br />
Add : Transfer from Investment allowance reserve 20.00 —<br />
Transfer from Profit and loss account 1081.36 674.83<br />
24668.25 23566.89<br />
Profit and loss account 2979.62 1097.45<br />
32061.13 29097.60<br />
SCHEDULE 3 : UNSECURED LOANS 31-12-09<br />
Rs. Lakhs<br />
From others :<br />
31-12-08<br />
Rs. Lakhs<br />
Interest-free sales tax deferral scheme granted by State Industries Promotion Corporation<br />
of Tamil Nadu Limited (Repayable within one year Rs. 99.50 lakhs, Previous Year : Rs. 104.29 lakhs) 204.78 309.07<br />
204.78 309.07
Consolidated Schedules<br />
73<br />
SCHEDULE 4 : FIXED ASSETS<br />
As at<br />
31-12-08<br />
GROSS BLOCK DEPRECIATION/AMORTISATION/IMPAIRMENT NET BLOCK<br />
Deductions/ As at As at Deductions/ For the year Impairment As at As at<br />
Adjustments 31-12-09 31-12-08 Adjustments<br />
(See note 2) 31-12-09 31-12-09<br />
Additions/<br />
Adjustments<br />
Rs. Lakhs<br />
As at<br />
31-12-08<br />
Intangible Assets<br />
Goodwill on consolidation 225.44 — — 225.44 — — — — — 225.44 225.44<br />
Tangible Assets<br />
Land freehold 153.86 — — 153.86 — — — — — 153.86 153.86<br />
Land leasehold 14.88 — — 14.88 4.50 — 0.16 — 4.66 10.22 10.38<br />
Buildings 6892.68 299.06 4.91 7186.83 2317.46 1.77 173.46 136.98 2626.13 4560.70 4575.22<br />
Plant, machinery, equipment etc. 29554.46 1091.00 5013.19 25632.27 19020.44 4073.89 1616.23 — 16562.78 9069.49 10534.02<br />
Furniture, fixtures and<br />
office appliances 2278.23 88.57 148.71 2218.09 1629.02 140.79 138.17 — 1626.40 591.69 649.21<br />
Vehicles 696.91 12.31 122.74 586.48 566.65 122.07 37.16 — 481.74 104.74 130.26<br />
Total 39816.46 1490.94 5289.55 36017.85 23538.07 4338.52 1965.18 136.98 21301.71 14716.14<br />
Previous Year 37403.21 3431.26 1018.01 39816.46 21085.88 595.98 2319.55 728.62 23538.07 16278.39<br />
Capital work-in-progress 550.63 1042.32<br />
Advances against capital orders 55.59 30.22<br />
606.22 1072.54<br />
15322.36 17350.93<br />
Notes :<br />
1 Buildings include Rs. 0.12 lakhs (Previous Year : Rs. 0.12 lakhs) being the cost of shares and bonds in co-operative housing societies.<br />
2. In accordance with the provisions of the Accounting Standard 28 on Impairment of Assets notified by the Companies (Accounting Standards) Rules 2006, the Company has identified<br />
certain fixed assets that were impaired mainly on account of economic performance and viability of such assets which does not have any value in use. Accordingly during current year an<br />
impairment loss of Rs. 136.98 lakhs in respect of Dyes and Specialty Chemicals segment (Rs. 12.47 lakhs) and Intermediates and Colours segment (Rs. 124.51 lakhs) has been recognised<br />
in the profit and loss account. (Previous Year Rs. 728.62 lakhs in respect of Intermediates and Colours segment).<br />
SCHEDULE 5 : INVESTMENTS (AT COST) 31-12-09<br />
Rs. Lakhs<br />
31-12-08<br />
Rs. Lakhs<br />
Non Trade – Unquoted<br />
Current<br />
In fully paid units of Rs. 10/- each<br />
9825217 (Previous Year : Nil) Birla Sun Life Saving Fund – Daily Dividend 983.19 —<br />
8883589 (Previous Year : Nil) HDFC Treasury Advantage Fund-Whole Sale Fund – Dividend – Daily 891.16 —<br />
4742864 (Previous Year : Nil) HDFC F R I F – STP-Whole Sale Fund – Dividend – Daily 478.12 —<br />
9776175 (Previous Year : Nil) DWS Ultra Short Term Fund – Dividend – Daily 979.37 —<br />
9019717 (Previous Year : Nil) DWS Cash Opportunity Fund – Dividend – Daily 904.16 —<br />
9695701 (Previous Year : Nil) JM Money Manager Fund – Super Plus Plan – Dividend-Daily 970.08 —<br />
4038543 (Previous Year : Nil) IDFC Money Manager Fund – Dividend – Daily 403.91 —<br />
9471776 (Previous Year : Nil) LIC MF Income Plus Fund – Dividend – Daily 947.18 —<br />
9197118 (Previous Year : Nil) LIC MF Saving Plus Fund – Dividend – Daily 919.71 —<br />
9847865 (Previous Year : Nil) LIC MF Floater Fund – Dividend – Daily 984.80 —<br />
Nil (Previous Year : 9346248) Birla Sun Life Short Term Fund – Institutional – Daily Dividend — 935.14<br />
Nil (Previous Year : 7999333) Fidelity Cash Fund-Institutional – Daily Dividend — 800.13<br />
Nil (Previous Year : 7754587) HDFC Liquid Fund Premium Plan – Dividend-Daily — 950.70<br />
Nil (Previous Year : 5571131) Reliance Medium Term Fund – Daily Dividend — 952.41<br />
In fully paid units of Rs. 100/- each<br />
863340 (Previous Year : Nil) ICICI Prudential Flexible Income Premium Plan Fund – Daily Dividend 912.85 —<br />
957923 (Previous Year : Nil) ICICI Prudential Floating Rate Plan D – Daily Dividend 958.12 —<br />
In fully paid units of Rs. 1000/- each<br />
91249 (Previous Year : Nil) Reliance Money Manager Fund – Institutional Plan – Daily Dividend 913.53 —<br />
65341 (Previous Year : 89206) DSP BlackRock Floating Rate Fund – Institutional Plan – Daily Dividend 653.77 892.06<br />
22483 (Previous Year : Nil) UTI Floating Rate Fund STP – Daily Dividend 225.00 —<br />
Nil (Previous Year : 83357) TATA Liquid Super High Investment Fund – Daily Dividend — 929.03<br />
Total Current 12124.95 5459.47<br />
Total Investments – Unquoted 12124.95 5459.47
74 <strong>Clariant</strong> Chemicals (India) Limited — Consolidated<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
SCHEDULE 6 : INVENTORIES 31-12-09<br />
Rs. Lakhs<br />
At lower of cost and net realisable value (As certified by the Management)<br />
31-12-08<br />
Rs. Lakhs<br />
Stores and spare parts 193.82 248.50<br />
Raw materials 2161.07 3340.38<br />
Packing materials 104.65 98.96<br />
Finished goods 4466.55 5740.02<br />
Work-in-progress 838.15 1203.69<br />
7764.24 10631.55<br />
SCHEDULE 7 : SUNDRY DEBTORS 31-12-09<br />
Rs. Lakhs<br />
31-12-08<br />
Rs. Lakhs<br />
Secured (Considered good)<br />
Over six months 5.68 9.02<br />
Other debts 1570.88 1349.06<br />
Unsecured (Considered good, unless otherwise stated)<br />
1576.56 1358.08<br />
Over six months (Including doubtful debts Rs. 246.31 lakhs; Previous Year : Rs. 280.89 lakhs) 330.84 396.73<br />
Other debts 12828.06 11745.76<br />
13158.90 12142.49<br />
Less : Provision for doubtful debts 246.31 280.89<br />
14489.15 13219.68<br />
SCHEDULE 8 : CASH AND BANK BALANCES 31-12-09<br />
Rs. Lakhs<br />
31-12-08<br />
Rs. Lakhs<br />
Cash on hand 4.19 6.66<br />
Cheques on hand 49.27 82.05<br />
With scheduled banks :<br />
On current accounts 1027.21 661.74<br />
On fixed deposit accounts 632.34 171.50<br />
1659.55 833.24<br />
1713.01 921.95
Consolidated Schedules<br />
75<br />
SCHEDULE 9 : LOANS AND ADVANCES 31-12-09<br />
Rs. Lakhs<br />
31-12-08<br />
Rs. Lakhs<br />
(Unsecured – considered good, unless otherwise stated)<br />
Advances recoverable in cash or in kind or for value to be received 3526.18 3676.80<br />
Less : Provision for doubtful advances 63.97 —<br />
3462.21 3676.80<br />
VAT set off admissible 104.89 52.51<br />
Advance payment of Income tax (Net of provision for taxation) 1769.39 1648.99<br />
Balances with customs and excise on current account 312.21 317.45<br />
5648.70 5695.75<br />
SCHEDULE 10 : CURRENT LIABILITIES 31-12-09<br />
Rs. Lakhs<br />
Sundry creditors :<br />
31-12-08<br />
Rs. Lakhs<br />
Due to micro enterprises and small enterprises (See Note 7, Schedule 17) 361.14 82.25<br />
Due to others 14168.74 11196.90<br />
14529.88 11279.15<br />
Deposits 1863.03 1443.85<br />
Unpaid dividends* 221.61 160.90<br />
Unclaimed fixed deposits* 0.06 0.15<br />
Unpaid interest on matured fixed deposits* 0.04 0.58<br />
16614.62 12884.63<br />
* There is no amount due and outstanding to be credited to Investor Education and Protection Fund<br />
SCHEDULE 11 : PROVISIONS 31-12-09<br />
Rs. Lakhs<br />
Employee Benefits :<br />
31-12-08<br />
Rs. Lakhs<br />
Leave encashment 365.02 491.71<br />
Gratuity 200.73 387.03<br />
Ex-gratia gratuity 69.21 84.42<br />
Others :<br />
Provision for taxation (Net of advance payment of Income tax) 1270.15 1177.43<br />
Proposed dividend (Final) 3999.11 5065.54<br />
Corporate tax on proposed dividend (Final) 679.65 860.89<br />
6583.87 8067.02
76 <strong>Clariant</strong> Chemicals (India) Limited — Consolidated<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
Schedules<br />
forming part of the Consolidated Profit and Loss Account<br />
SCHEDULE 12 : OTHER INCOME <strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
Dividend on current non-trade investments 407.90 171.56<br />
Export incentives 420.13 482.72<br />
Profit on sale of fixed assets (Net) 80.31 9.58<br />
Cash discounts 39.40 36.15<br />
Rental income 398.25 364.66<br />
Indenting commission 589.29 634.52<br />
Profit on sale of current investments (Net) 0.21 0.29<br />
Miscellaneous 727.68 830.78<br />
2663.17 2530.26<br />
SCHEDULE 13 : COST OF MATERIALS <strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
Raw materials consumed 38507.15 42091.18<br />
Packing materials consumed 2279.01 2207.08<br />
Purchases of finished goods 12133.72 13003.39<br />
(Increase)/Decrease in stocks of finished goods and work-in-progress :<br />
Opening stock<br />
Finished goods 5740.02 6715.39<br />
Work-in-progress 1203.69 1192.30<br />
Less : Closing stock<br />
6943.71 7907.69<br />
Finished goods 4466.55 5740.02<br />
Work-in-progress 838.15 1203.69<br />
5304.70 6943.71<br />
1639.01 963.98<br />
54558.89 58265.63<br />
SCHEDULE 14 : PERSONNEL COST <strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
Salaries, wages, bonus, etc. 4677.67 5256.71<br />
Contribution/Provision for provident fund, superannuation scheme, gratuity fund, etc. 551.95 1028.20<br />
Welfare expenses 929.09 945.00<br />
6158.71 7229.91
Consolidated Schedules<br />
77<br />
SCHEDULE 15 : INTEREST (NET) <strong>2009</strong><br />
Rs. Lakhs<br />
Interest Paid<br />
2008<br />
Rs. Lakhs<br />
Others 100.32 153.38<br />
Less : Interest received (Gross) :<br />
100.32 153.38<br />
Others (Tax deducted at source Rs. 12.69 Lakhs; Previous Year : Rs. 7.71 Lakhs) 83.20 171.67<br />
83.20 171.67<br />
17.12 (18.29)<br />
SCHEDULE 16 : OTHER EXPENDITURE <strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
Stores and Spare parts etc. consumed 612.05 606.65<br />
Repairs and maintenance :<br />
Plant and machinery 712.77 896.24<br />
Buildings 218.64 216.51<br />
Others 164.76 187.74<br />
Power and fuel 4595.77 4485.35<br />
Rent (including lease payments) (See note 9, Schedule 17) 555.90 582.10<br />
Rates and taxes (including water charges) 519.90 659.06<br />
Insurance 69.40 110.65<br />
Clearing, forwarding and transport 1337.29 1533.81<br />
Travelling and conveyance 881.57 971.22<br />
Commission 179.83 250.64<br />
Cash discount 11.76 22.37<br />
Other discounts on sales 684.65 1324.79<br />
Assets written-off 100.69 392.98<br />
Provision for doubtful debts/advances (Net) 29.39 200.11<br />
Excise duty (322.38) (374.50)<br />
Exchange loss (Net) 168.57 158.29<br />
Miscellaneous (See note 11, Schedule 17) 3820.14 3813.78<br />
14340.70 16037.79
78 <strong>Clariant</strong> Chemicals (India) Limited — Consolidated<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
Notes to the Consolidated Financial Statements<br />
schedule 17 : Notes on the Consolidated Balance Sheet and Profit and Loss Account for the year ended 31st December, <strong>2009</strong><br />
1. Significant Accounting Policies<br />
BASIS OF PREPARATION<br />
The Consolidated Financial Statements are prepared in accordance with Accounting Standard (AS) 21 on Consolidated Financial Statements<br />
notified by Companies (Accounting Standards) Rules, 2006. The Consolidated Financial Statements comprise the financial statements of <strong>Clariant</strong><br />
Chemicals (India) Limited and its subsidiary viz. Chemtreat Composites India Private Limited (voting power-100%). The said Company became<br />
subsidiary on and from February 13, 2006. This subsidiary company is incorporated in India.<br />
The financial statements are prepared at historical cost on the accrual basis of accounting and in accordance with the standards on accounting<br />
notified by the Companies (Accounting Standards) Rules, 2006 and referred to in Section 211(3C) of the Companies Act, 1956.<br />
The significant accounting policies are as follows :<br />
I. Revenue Recognition<br />
The Company recognises sale of goods on transfer of significant risks and rewards of ownership of the goods to the buyer. Sales are net<br />
of excise duty, sales tax and trade discounts, wherever applicable.<br />
Dividend income on investments is accounted for when the right to receive the payment is established.<br />
II.<br />
III.<br />
IV.<br />
Excise Duty<br />
Excise duty payable on products is accounted for at the time of despatch of goods from the factories but is accrued for stocks held at<br />
the year end.<br />
Excise Duty related to the difference between the closing stock and opening stock of finished goods has been recognised separately in<br />
the profit and loss account under Schedule of ‘Other Expenditure’.<br />
Research and Development<br />
Revenue expenditure on research and development is written off in the profit and loss account in the year in which it is incurred. Capital<br />
expenditure on research and development is treated in the same way as expenditure on fixed assets.<br />
Employee Benefits<br />
(a)<br />
(b)<br />
Short term employee benefit obligations are estimated and provided for.<br />
Post employment benefits and other long term employee benefits:<br />
Defined contribution plans :<br />
Company’s contribution to provident fund, superannuation fund, employee state insurance and other funds are determined under the<br />
relevant schemes and/or statute and charged to revenue.<br />
Defined benefit plans and compensated absences :<br />
Company’s liability towards gratuity, ex-gratia gratuity and compensated absences are actuarially determined at each balance sheet<br />
date using the projected unit credit method. Actuarial gains and losses are recognised in revenue.<br />
V. Voluntary Retirement Scheme<br />
Expenditure incurred on voluntary retirement scheme is charged to revenue in the year in which it is incurred.<br />
VI.<br />
Fixed Assets and Depreciation/Amortisation<br />
(a)<br />
All fixed assets are stated at cost less depreciation, wherever applicable. Cost comprises the purchase price and any other<br />
attributable cost of bringing the asset to its working condition for its intended use. Borrowing cost relating to funds borrowed for<br />
acquisition of qualifying assets for the year upto the date the assets are put to use is included in cost.
Notes to the Consolidated Financial Statements<br />
79<br />
(b)<br />
(c)<br />
(d)<br />
(e)<br />
The cost of leasehold land is amortised over the period of the lease.<br />
Intangible assets except Goodwill on consolidation are being amortised equally over a period of three years.<br />
Depreciation has been calculated on the straight line method at the rates and in the manner specified in Schedule XIV of the<br />
Companies Act, 1956 except for :<br />
(i)<br />
(ii)<br />
certain items of furniture, fixture, air conditioners, plant, machinery and equipment on which a depreciation rate of 20% on<br />
straight line method is applied,<br />
electronic data processing (EDP) hardware such as servers on which a depreciation rate of 20% and for other EDP equipments<br />
including personal computers and printers on which depreciation rate of 25% on straight line method is applied,<br />
(iii) Motor Cars on which depreciation rate of 25% on straight line method is applied.<br />
Fixed Assets held for disposal are stated at lower of net book value and net realisable value.<br />
VII.<br />
VIII.<br />
IX.<br />
Impairment of Assets<br />
The carrying amounts of assets are reviewed at each Balance Sheet date if there is any indication of impairment based on<br />
internal/external factors. An impairment loss is recognised wherever the carrying amount of an asset exceeds its estimated recoverable<br />
amount. The recoverable amount is greater of the asset’s net selling price and value in use. In assessing the value in use, the estimated<br />
future cash flows are discounted to the present value using the weighted average cost of capital. Previously recognised impairment loss<br />
is further provided or reversed depending on changes in circumstances.<br />
Inventories<br />
Inventories are valued at the lower of cost and estimated net realisable value after providing for obsolescence. The cost of inventories<br />
is generally arrived at on the following basis :<br />
Raw materials, packing materials, trading items and stores and spares – Weighted average cost<br />
Finished goods and work-in-progress – Absorption costing at works cost<br />
Sundry Debtors/Loans and Advances<br />
Sundry debtors and loans and advances are stated after making adequate provision for doubtful debts/advances.<br />
X. Investments<br />
Long term investments are stated at cost less provision for diminution in value, other than temporary. Current investments are stated at<br />
the lower of cost and fair value. Dividends are accounted for when the right to receive the dividend payment is established.<br />
XI.<br />
XII.<br />
XIII.<br />
Leases<br />
Leases where the lessor effectively retains substantially all the risks and benefits of ownership of the leased assets are classified as<br />
operating leases. Operating lease payments are recognised as an expense in the Profit and Loss Account on a straight-line basis over the<br />
lease term.<br />
Foreign Currency Translations<br />
(a) Monetary items denominated in foreign currency are translated at the exchange rate prevailing on the last day of the accounting<br />
year. In respect of items covered by forward contracts, the premium or discount arising at the inception of such a forward exchange<br />
contract is amortised as expense or income over the life of the contract. Any profit or loss arising on cancellation of such a forward<br />
exchange contract is recognised as income or expense for the period. Foreign currency transactions are accounted at the rate<br />
prevailing on the date of transaction.<br />
(b) Non-monetary items which are carried in terms of historical cost denominated in a foreign currency are reported using the exchange<br />
rate at the date of transaction.<br />
(c) Gain or loss arising out of translation/conversion is taken credit for or charged to the Profit and Loss Account.<br />
Income Tax<br />
Income-tax expense comprises current tax and deferred tax charge or credit. The current tax is determined as the amount of tax payable<br />
in respect of the estimated taxable income for the year. The deferred tax charge or credit is recognised using prevailing enacted or<br />
substantively enacted tax rates. Where there is unabsorbed depreciation or carry forward losses, deferred tax assets are recognised only<br />
if there is virtual certainty of realisation of such assets. Other deferred tax assets are recognised only to the extent there is reasonable<br />
certainty of realisation in future. Deferred tax assets/liabilities are reviewed at each Balance Sheet date based on developments during<br />
the year and available case laws, to reassess realisation/liabilities.
80 <strong>Clariant</strong> Chemicals (India) Limited — Consolidated<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
XIV.<br />
Contingencies/Provisions<br />
Provision is recognised when the Company has a present obligation as a result of past event; it is probable that an outflow of resources<br />
embodying economic benefit will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions<br />
except in respect of employee benefits are not discounted to its present value and are determined based on best estimate of the<br />
expenditure required to settle the obligation at the Balance Sheet date. These are reviewed at each Balance Sheet date and adjusted<br />
to reflect the current best estimate. A contingent liability is disclosed, unless the possibility of an outflow of resources embodying the<br />
economic benefit is remote.<br />
2. Segment Information for the year ended 31st December, <strong>2009</strong> (As required by Accounting Standard (AS)-17 Segment <strong>Report</strong>ing) :<br />
(a) The Company is organised into two primary business segments mainly :<br />
(i) Intermediates and Colours :<br />
Includes pigment dyestuffs and their dispersion, Intermediates for dyes, pesticides and pharmaceuticals and master batches for<br />
plastics and nylon fibers.<br />
(ii) Dyes and Specialty Chemicals :<br />
Includes dyestuff synthetic resins, binder materials, auxiliaries and chemicals.<br />
(b) The secondary segments of the Company are geographical segments mainly :<br />
(i) India<br />
(ii) Outside India<br />
(c)<br />
Segments have been identified and reported taking into account the nature of products and services, the differing risk and returns, the<br />
organisation structure, and the internal financial reporting system.<br />
(d) (i) Segment Revenue and Results :<br />
The expenses which are not directly attributable to the business segment are shown as unallocated corporate cost.<br />
(ii) Segment assets and liabilities :<br />
Segment assets include all operating assets used by the business segment and consist principally of fixed assets, debtors and<br />
inventories. Segment liabilities primarily include creditors and other liabilities.<br />
(iii) Assets and liabilities that cannot be allocated among the segments are shown as a part of unallocable corporate assets and<br />
liabilities respectively.<br />
Information about primary business segments :<br />
Intermediates<br />
&<br />
Colours*<br />
<strong>2009</strong><br />
Rs. Lakhs<br />
Dyes and<br />
Specialty<br />
Chemicals<br />
Total<br />
Intermediates<br />
&<br />
Colours *<br />
2008<br />
Rs. Lakhs<br />
Dyes and<br />
Specialty<br />
Chemicals<br />
Revenue (Net)<br />
External Sales/Revenue 39266.95 53165.69 92432.64 40169.07 51854.86 92023.93<br />
Results<br />
Segment Results 8477.04 10758.66 19235.70 4704.42 7040.26 11744.68<br />
Unallocated Corporate Expenses (Net) (917.45) (1270.32)<br />
Operating profits 18318.25 10474.36<br />
Interest Income/Dividend Income 491.10 343.23<br />
Interest Expenses (100.32) (153.38)<br />
Profit before Exceptional Items and Taxation 18709.03 10664.21<br />
Exceptional items (See note 12, Schedule 17) (2450.46) (48.00)<br />
Profit before Taxation After Exceptional Items 16258.57 10616.21<br />
Current Tax/Deferred Tax (5427.34) (3550.26)<br />
Fringe Benefit Tax (39.00) (118.50)<br />
Short provision for taxation in respect of earlier years (30.77) (248.09)<br />
Profit after Tax 10761.46 6699.36<br />
Total
Notes to the Consolidated Financial Statements<br />
81<br />
Information about primary business segments : (Contd.)<br />
Intermediates<br />
&<br />
Colours*<br />
<strong>2009</strong><br />
Rs. Lakhs<br />
Dyes and<br />
Specialty<br />
Chemicals<br />
Total<br />
Intermediates<br />
&<br />
Colours *<br />
2008<br />
Rs. Lakhs<br />
Dyes and<br />
Specialty<br />
Chemicals<br />
Other Information<br />
Segment Assets 19429.34 20580.09 40009.43 20989.52 22413.01 43402.53<br />
Unallocated Corporate Assets 16075.93 8227.81<br />
Total Assets 56085.36 51630.34<br />
Segment Liabilities 6597.21 9039.17 15636.38 4585.83 8065.95 12651.78<br />
Unallocated Corporate Liabilities 1817.98 1505.08<br />
Total Liabilities 17454.36 14156.86<br />
Capital Expenditure 668.46 316.36 984.82 1413.84 1240.40 2654.24<br />
Unallocated Corporate Capital Expenditure 14.43 35.20<br />
Total Capital Expenditure 999.25 2689.44<br />
Depreciation/Amortisation 1008.70 887.46 1896.16 1132.43 1100.77 2233.20<br />
Impairment of Fixed Assets 124.51 12.47 136.98 728.62 — 728.62<br />
Unallocated Corporate Depreciation 69.02 86.35<br />
Total Depreciation/Amortisation/Impairment 2102.16 3048.17<br />
Non-cash Expenses other than Depreciation/<br />
Amortisation/Impairment 61.72 63.93 125.65 541.04 298.42 839.46<br />
Unallocated Corporate Non-cash Expenses other than<br />
Depreciation/Amortisation/Impairment 64.28 33.20<br />
Total Non-cash Expenses other than<br />
Depreciation/Amortisation/Impairment 189.93 872.66<br />
Information about Secondary Segments :<br />
<strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
Total<br />
India Outside India Total India Outside India Total<br />
External Sales 75075.99 17356.65 92432.64 72990.89 19033.04 92023.93<br />
Segment Assets 36364.76 3644.67 40009.43 40417.60 2984.93 43402.53<br />
Additions to Fixed Assets 984.82 — 984.82 2654.24 — 2654.24<br />
Notes :<br />
1 Total assets exclude the following :<br />
(a) Advance payment of income tax Rs. 1769.39 lakhs (Rs. 1648.99 lakhs).<br />
(b) Deferred tax assets (Net) Rs. 275.72 lakhs (Rs. Nil).<br />
2 Total liabilities exclude the following :<br />
(a) Proposed dividend Rs. 3999.11 lakhs (Rs. 5065.54 lakhs).<br />
(b) Corporate tax on proposed dividend Rs. 679.65 lakhs (Rs. 860.89 lakhs).<br />
(c) Provision for taxation Rs. 1270.15 lakhs (Rs. 1177.43 lakhs).<br />
(d) Deferred tax liability (Net) Rs. Nil (Rs. 254.94 lakhs).<br />
* Products hitherto reported under “Masterbatches” segment is now reported under “Intermediates & Colours” segment since the products are<br />
similar in nature.
82 <strong>Clariant</strong> Chemicals (India) Limited — Consolidated<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
3. Related Party Disclosure as required by AS-18 “Related Party Disclosures” are given below :<br />
Relationship :<br />
(a) Holding Company :<br />
EBITO Chemiebeteiligungen AG, <strong>Clariant</strong> International AG and <strong>Clariant</strong> Participations AG, together hold 63.40% equity shares in the<br />
Company, the ultimate holding company being <strong>Clariant</strong> AG, Switzerland.<br />
(b) Other related parties in the <strong>Clariant</strong> group where common control exists and with whom the company has transactions :<br />
Fellow Subsidiary Companies :<br />
<strong>Clariant</strong> (Argentina) SA<br />
<strong>Clariant</strong> Masterbatches (Italia) S.p.A.<br />
<strong>Clariant</strong> (Australia) Pty. Ltd.<br />
<strong>Clariant</strong> Masterbatches (Shanghai) Ltd.<br />
<strong>Clariant</strong> (Canada) Inc.<br />
<strong>Clariant</strong> Masterbatches (Thailand) Ltd.<br />
<strong>Clariant</strong> (China) Ltd.<br />
<strong>Clariant</strong> Masterbatches Benelux SA<br />
<strong>Clariant</strong> (Colombia) SA<br />
<strong>Clariant</strong> Masterbatches Huningue<br />
<strong>Clariant</strong> (Egypt) SAE<br />
<strong>Clariant</strong> Masterbatches Ireland Limited<br />
<strong>Clariant</strong> (Gulf) FZE<br />
<strong>Clariant</strong> Masterbatches Norden AB<br />
<strong>Clariant</strong> (Japan) K.K.<br />
<strong>Clariant</strong> Masterbatches UK Ltd.<br />
<strong>Clariant</strong> (Korea) Ltd.<br />
<strong>Clariant</strong> Oil Services UK Ltd.<br />
<strong>Clariant</strong> (Malaysia) Sdn Bhd<br />
<strong>Clariant</strong> Pigments (Korea) Ltd.<br />
<strong>Clariant</strong> (Maroc) S.A.<br />
<strong>Clariant</strong> Pigments (Tianjin) Ltd.<br />
<strong>Clariant</strong> (Mexico) S.A. de C.V.<br />
<strong>Clariant</strong> Prodotti (Italia) S.p.A.<br />
<strong>Clariant</strong> (Pakistan) Ltd.<br />
<strong>Clariant</strong> Production (France)<br />
<strong>Clariant</strong> (Singapore) Pte. Ltd.<br />
<strong>Clariant</strong> Production UK Ltd.<br />
<strong>Clariant</strong> (Thailand) Ltd.<br />
<strong>Clariant</strong> Produkte (Deutschland) GmbH<br />
<strong>Clariant</strong> (Tianjin) Ltd.<br />
<strong>Clariant</strong> Produkte (Schweiz) AG<br />
<strong>Clariant</strong> (Uruguay) SA<br />
<strong>Clariant</strong> S.A.<br />
<strong>Clariant</strong> Advanced Materials GmbH<br />
<strong>Clariant</strong> Southern Africa (Pty.) Ltd.<br />
<strong>Clariant</strong> Chemicals (China) Ltd.<br />
<strong>Clariant</strong> Specialty Chemicals (Zhenjiang) Co., Ltd.<br />
<strong>Clariant</strong> Chemicals (Taiwan) Co., Ltd.<br />
<strong>Clariant</strong> Specialty Fine Chemicals (France)<br />
<strong>Clariant</strong> Colorquímica (Chile) Ltda.<br />
<strong>Clariant</strong> Trading (China) Ltd.<br />
<strong>Clariant</strong> Corporation<br />
<strong>Clariant</strong> Venezuela, S.A.<br />
<strong>Clariant</strong> Distribution UK Ltd.<br />
Dick Peters B.V.<br />
<strong>Clariant</strong> Distribuzione (Italia) S.p.A.<br />
K. J. Quinn<br />
<strong>Clariant</strong> Export AG<br />
PT <strong>Clariant</strong> Indonesia<br />
<strong>Clariant</strong> Ibérica Producción S.A.<br />
<strong>Clariant</strong> Life Science Molecules (Florida) Inc.<br />
<strong>Clariant</strong> Masterbatch Ibérica S.A.<br />
<strong>Clariant</strong> (Türkiye) Boya ve Kimyevi Maddeler Sanayi ve Ticaret A.S.<br />
<strong>Clariant</strong> Masterbatches (Deutschland) GmbH<br />
(c) Key Management Personnel :<br />
H. Meier : Vice-Chairman & Managing Director (upto 31.12.<strong>2009</strong>)<br />
During the year following transactions were entered into with related parties :<br />
(i) Holding Company and Fellow Subsidiaries :<br />
<strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
Holding Company :<br />
Transactions during the year :<br />
<strong>Clariant</strong> International AG<br />
Sale of goods 1501.15 1742.65<br />
Purchase of goods 9234.75 7673.84<br />
Services rendered 377.62 324.08<br />
Services received 699.34 644.13<br />
Dividend paid 1761.75 607.50<br />
Expenses recovered 1.51 19.46<br />
EBITO Chemiebeteiligungen AG<br />
Dividend Paid 2368.46 816.71<br />
<strong>Clariant</strong> Participations AG<br />
Dividend Paid 771.40 266.00<br />
Balances outstanding as at the year end :<br />
Amount payable 1142.51 984.03<br />
Amount receivable 449.12 676.53
Notes to the Consolidated Financial Statements<br />
83<br />
During the year following transactions were entered into with related parties : (Contd.)<br />
(i) Holding Company and Fellow Subsidiaries :<br />
<strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
Fellow Subsidiaries :<br />
Transactions during the year :<br />
Sale of goods<br />
<strong>Clariant</strong> Produkte (Deutschland) GmbH 1419.66 2338.86<br />
<strong>Clariant</strong> Corporation 1239.30 2321.54<br />
<strong>Clariant</strong> (China) Ltd. 2895.33 1524.41<br />
PT <strong>Clariant</strong> Indonesia 1170.42 811.89<br />
Others 4474.85 4119.63<br />
Purchase of goods<br />
<strong>Clariant</strong> (Tianjin) Ltd. 51.95 170.67<br />
<strong>Clariant</strong> (China) Ltd. 771.38 1008.24<br />
<strong>Clariant</strong> Corporation 44.82 127.58<br />
Others 486.29 211.87<br />
Purchase of capital goods<br />
<strong>Clariant</strong> Masterbatches (Deutschland) GmbH 5.27 170.08<br />
<strong>Clariant</strong> Masterbatches (Italia) S.p.A. 10.00 23.34<br />
<strong>Clariant</strong> Production UK Ltd. 2.97 —<br />
Sale of capital goods<br />
<strong>Clariant</strong> Produkte (Deutschland) GmbH 50.47 —<br />
Services rendered and others<br />
<strong>Clariant</strong> Export AG 308.38 283.67<br />
<strong>Clariant</strong> Produkte (Deutschland) GmbH 0.54 70.55<br />
Others 40.52 44.70<br />
Expenses recovered<br />
<strong>Clariant</strong> Produkte (Deutschland) GmbH — 4.49<br />
PT <strong>Clariant</strong> Indonesia 0.22 —<br />
<strong>Clariant</strong> (Singapore) Pte. Ltd. 0.05 —<br />
Others — 0.78<br />
Services received and others<br />
PT <strong>Clariant</strong> Indonesia 18.49 8.19<br />
<strong>Clariant</strong> (Singapore) Pte. Ltd. 20.67 29.65<br />
<strong>Clariant</strong> Southern Africa (Pty.) Ltd. 27.35 8.86<br />
<strong>Clariant</strong> Produkte (Deutschland) GmbH — 8.93<br />
<strong>Clariant</strong> S.A. — 10.51<br />
<strong>Clariant</strong> (Gulf) FZE 11.37 2.77<br />
Others 16.55 17.83<br />
Expenses reimbursed<br />
PT <strong>Clariant</strong> Indonesia 0.76 —<br />
<strong>Clariant</strong> (Malaysia) Sdn Bhd 1.63 —<br />
Balances outstanding as at the year end<br />
Amount payable 424.20 520.37<br />
Amount receivable 2476.97 1450.59<br />
(ii) Key Management Personnel :<br />
Remuneration 217.09 164.97<br />
Payable balance 67.58 26.75
84 <strong>Clariant</strong> Chemicals (India) Limited — Consolidated<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
4. Contingent liabilities not provided for :<br />
31-12-<strong>2009</strong><br />
Rs. Lakhs<br />
31-12-2008<br />
Rs. Lakhs<br />
I. (a) in respect of income tax matters<br />
decided against the Company, in respect of which the Company is in further appeal 1458.40 856.16<br />
II.<br />
decided in favour of the Company against which the department is in appeal 14.78 14.78<br />
(b) in respect of sales tax matters 578.58 494.22<br />
(c) in respect of excise matters 448.03 455.66<br />
(d) in respect of bills of exchange discounted with banks<br />
1119.58 29.60<br />
[since realised Rs. 783.61 lakhs (Rs.17.73 lakhs)]<br />
(e) Other matters in dispute 2.25 2.25<br />
(f) Disputed labour matters – Amount not ascertained.<br />
In respect of items (a) to (c), (e) & (f) future cash outflows in respect of contingent liabilities is determinable only on receipt of judgements<br />
pending at various forums/authorities.<br />
On 15th February 2005, the Company had received an order of the Tahsildar, Thane demanding Rs.120.70 lakhs for the lease of land to<br />
Thane Municipal Corporation, Fire Brigade and Maharashtra State Electricity Board without obtaining prior permission in writing against<br />
which the Company had filed a writ petition on 23rd February 2005 before the Bombay High Court. The Hon’ble High Court has granted<br />
interim stay in terms of the petition on 14th July 2005.<br />
31-12-<strong>2009</strong><br />
Rs. Lakhs<br />
31-12-2008<br />
Rs. Lakhs<br />
5. Estimated amount of contracts remaining to be executed on capital account and not<br />
provided for 179.15 201.56<br />
6. Deferred taxes :<br />
The major components of deferred tax assets and deferred tax liabilities are set out below :<br />
31-12-<strong>2009</strong><br />
Rs. Lakhs<br />
31-12-2008<br />
Rs. Lakhs<br />
Deferred tax assets<br />
(a) Provision for doubtful debts 105.50 95.50<br />
(b) Provision for retirement benefits 215.89 327.47<br />
(c) Expenses allowable for tax purposes when paid 53.54 53.54<br />
(d) Integration expenses 15.74 78.70<br />
(e) Payment/Provision for voluntary retirement scheme 1184.64 552.46<br />
(f) Others — 1.23<br />
1575.31 1108.90<br />
Deferred tax liabilities<br />
Depreciation/Amortisation/Impairment (1299.59) (1363.84)<br />
Deferred Tax assets/(liabilities) – Net 275.72 (254.94)<br />
7. Amount paid/payable by the Company to Directors (including Managing Director) as remuneration for services rendered in any<br />
capacity :<br />
<strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
Directors’ sitting fees 1.45 0.90<br />
Salaries 137.76 136.17<br />
Commission 36.75 34.75*<br />
Compensation for loss of office 40.83 —<br />
Provident fund 11.35 1.89<br />
Other perquisites and benefits in cash or in kind 0.40 0.16<br />
228.54 173.87<br />
* Actual paid during the Year Rs. 25.49 lakhs and Rs. 9.26 lakhs reversed during the year.
Notes to the Consolidated Financial Statements<br />
85<br />
8. Earnings Per Share :<br />
<strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
(a) Net profit after taxation 10761.46 6699.36<br />
(b) Number of equity shares outstanding 26660745 26660745<br />
(c) Basic and Diluted earnings per share (Rupees) 40.36 25.13<br />
(d) Face value per share (Rupees) 10.00 10.00<br />
9. Assets taken on lease on or after 1st April, 2001 :<br />
(a)<br />
(b)<br />
(c)<br />
(d)<br />
<strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
In respect of operating leases, where lease agreements have been formally entered into,<br />
lease payments recognised in the profit and loss account for the year are as follows.<br />
Office premises, vehicles and computers 382.43 377.91<br />
There are no restrictions such as those concerning dividends, additional debt and further<br />
leasing, imposed by the lease agreements entered into by the Company.<br />
Contingent rent payments in respect of vehicles are dependent upon the excess of actual<br />
usage, if any, over stipulated usage.<br />
The total of future minimum lease payments under non-cancellable operating leases are<br />
as follows :<br />
For a period not later than one year 285.05 326.65<br />
For a period later than one year and not later than five years 254.37 343.68<br />
Total 539.42 670.33<br />
10. Expenditure on Research and Development :<br />
<strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
(a) Capital expenditure 3.36 9.93<br />
(b) Revenue expenditure charged to profit and loss account 224.20 323.29<br />
227.56 333.22<br />
11. Miscellaneous Expenses in Schedule 16 : Other expenditure include :<br />
Auditors’ remuneration and expenses : (Excluding Service tax)<br />
<strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
(a) Audit fees 25.00 25.00<br />
(b) Company law matters 0.15 —<br />
(c) Taxation services 0.23 —<br />
(d) Other services 31.20 37.50<br />
(e) Out-of-pocket expenses 0.45 0.11<br />
57.03 62.61<br />
12. Exceptional items in Profit & Loss Account include :<br />
<strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
Termination benefits to Employees 2810.46 48.00<br />
Income from sale of flexible laminating adhesives business (360.00) —<br />
2450.46 48.00
86 <strong>Clariant</strong> Chemicals (India) Limited — Consolidated<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
13. Employee Benefits :<br />
<strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
Funded Unfunded Funded Unfunded<br />
(a) Defined benefit Plans – As per Actuarial valuation as on December 31, <strong>2009</strong> :<br />
Gratuity<br />
(i) Expenses recognised in the statement of Profit and Loss Account for the year<br />
1. Current Service Cost 181.10 4.17 190.63 4.36<br />
2. Interest Cost 178.36 6.86 142.81 6.01<br />
3. Expected return on Plan Assets (204.25) — (194.58) —<br />
4. Net acturial (Gain)/Loss recognised during the year (133.86) 4.54 234.40 (5.81)<br />
5. Expense/(Income) recognised in Profit & Loss Account 21.35 15.57 373.26 4.56<br />
[Gratuity expense/(income) have been recognised in Contribution/Provision for<br />
provident fund, superannuation scheme, gratuity fund etc. in “Personnel Cost”<br />
under Schedule 14]<br />
(ii) Actual return on Plan Assets for the year<br />
1. Expected return on Plan Assets 204.25 — 194.58 —<br />
2. Actuarial Gain/(Loss) on Plan Assets (38.87) — 39.51 —<br />
3. Actual return on Plan Assets 165.38 — 234.09 —<br />
(iii) Net Asset/(Liability) recognised in the Balance Sheet as at the year end<br />
1. Present Value of the Defined Benefit Obligation 2342.20 69.21 2940.12 84.42<br />
2. Fair Value of Plan Assets 2141.47 — 2553.09 —<br />
3. Net Asset/(Liability) recognised in the Balance Sheet (200.73) (69.21) (387.03) (84.42)<br />
(iv) Change in Defined Benefit Obligation during the year<br />
1. Present Value of Obligation at the beginning of the year 2940.12 84.42 2551.45 80.18<br />
2. Current Service Cost 181.10 4.17 190.63 4.36<br />
3. Interest Cost 178.36 6.86 142.81 6.01<br />
4. Benefits Paid (784.65) (30.78) (218.68) (0.32)<br />
5. Actuarial (Gain)/Loss on obligation (172.73) 4.54 273.91 (5.81)<br />
6. Present Value of Obligation as at the end of the year 2342.20 69.21 2940.12 84.42<br />
(v) Changes in fair value of Plan Asset during the year<br />
1. Fair Value of Plan Assets as at the beginning of the year 2553.09 — 2432.22 —<br />
2. Expected return on Plan Assets 204.25 — 194.58 —<br />
3. Contributions made 207.65 — 105.46 —<br />
4. Benefits paid (784.65) — (218.68) —<br />
5. Actuarial Gain/(Loss) on Plan Assets (38.87) — 39.51 —<br />
6. Fair value of Plan Assets as at the end of the year 2141.47 — 2553.09 —<br />
(vi) Major categories of Plan Assets as a percentage of Total Plan Assets<br />
1. Central Government Securities 29.64% — 24.84% —<br />
2. State Government Securities 12.32% — 10.03% —<br />
3. Private Sector Bonds 20.90% — 15.21% —<br />
4. Special Deposit Scheme 25.54% — 21.69% —<br />
5. Cash at Bank 1.15% — 1.10% —<br />
6. Investment in Insurance Companies 22.06% — 22.67% —<br />
7. Others (11.61%) — 4.46% —<br />
(vii) Actuarial Assumptions<br />
1. Discount Rate 8.0% 8.0% 7.0% 7.0%<br />
2. Expected Rate of return on Plan Assets 8.0% — 8.0% —<br />
3. Salary Escalation 4.0%-6.0% 4.0%-6.0% 4.0%-6.0% 4.0%-6.0%<br />
(viii) Experience Adjustments<br />
1. Experience Adjustments on Plan Assets (38.87) — — —<br />
2. Experience Adjustments on Plan Liabilities (49.77) 4.54 — —
Notes to the Consolidated Financial Statements<br />
87<br />
13. Employee Benefits : (Contd.)<br />
(a)<br />
(b)<br />
(c)<br />
(d)<br />
(e)<br />
(f)<br />
<strong>2009</strong><br />
Rs. Lakhs<br />
2008<br />
Rs. Lakhs<br />
Defined benefit Plans – As per Actuarial valuation as on December 31, <strong>2009</strong> : (Contd.)<br />
Other Long Term Benefits<br />
The Defined Benefit obligations which are provided for but not funded are as under:<br />
Compensated Absence/Leave Salary 365.02 491.71<br />
Gratuity is administered through duly constituted and approved independent trusts and<br />
also through Group gratuity scheme with Life Insurance Corporation of India<br />
Future salary increases considered in acturial valuation take in to account inflation,<br />
seniority, promotion and other relevant factors, such as supply and demand in the<br />
employment market<br />
Basis used to determine expected rate of return on plan assets:<br />
The expected rate of return on plan assets is based on market expectation, at the<br />
beginning of the year, for returns over the entire life of the related obligation.<br />
Accounting standard 15 (Revised 2005) “Employee Benefits” requires the disclosure of<br />
experience adjustments for past four years, however, the information is given only for<br />
the current year.<br />
During the year the Company has recognised the following amounts in the Profit & Loss<br />
Account in Schedule 14 :<br />
Salaries, wages, bonus etc. includes compensated absences 49.17 93.02<br />
Contribution/Provision for provident fund, superannuation scheme, gratuity fund etc.<br />
includes :<br />
Provident Fund & Family Pension 275.30 278.81<br />
Superannuation Fund 239.24 370.57<br />
Gratuity Fund 36.92 377.82<br />
Other Funds 0.49 1.00<br />
14. The Company has entered into an agreement with Laxmi Organic Industries Ltd. on May 15, <strong>2009</strong> for the sale of its business of Diketene and<br />
downstream intermediate products together with removable plant and equipment. On receipt of full consideration, the transaction has been<br />
concluded in January 2010.<br />
15. Figures for the previous year have been regrouped wherever necessary to conform to the current year’s classification.<br />
16. The figures in brackets are those in respect of the previous accounting year.<br />
For and on behalf of the Board<br />
R. A. Shah Chairman<br />
P. Palm Vice-Chairman & Managing Director<br />
Diwan A. Nanda Director<br />
B. L. Gaggar Director Finance & Company Secretary<br />
Mumbai, 19th February, 2010
88 <strong>Clariant</strong> Chemicals (India) Limited<br />
<strong>Annual</strong> <strong>Report</strong> <strong>2009</strong><br />
Financial Performance<br />
10 Years‘ Highlights<br />
(Rs. Million)<br />
Financial Year Ended 31st December<br />
Financial Year Ended 31st March<br />
<strong>2009</strong> 2008 2007 ****2006 ***2006 2005 2004 2003 2002 2001<br />
I. OPERATING RESULT<br />
Gross Sales 9732.2 10014.5 9517.1 7538.9 9246.5 4035.2 4083.4 3821.7 3310.1 3301.9<br />
Net Sales 9213.4 9163.9 8614.4 6870.4 8479.1 3656.1 3746.8 3492.8 2990.1 2991.8<br />
Gross Earnings Before Depreciation/<br />
Impairment and Taxation +2079.4 +1375.7 +1021.3 +655.7 893.1 472.5 380.0 343.7 273.0 236.8<br />
Profit Before Taxation #1631.1 #1072.9 #493.3 #507.8 648.4 *357.8 249.5 214.7 141.6 114.8<br />
Profit After Taxation 1081.4 674.8 317.9 328.7 403.9 155.9 335.7 149.7 90.6 89.8<br />
Equity Dividend 666.5 506.6 266.6 479.9 293.3 69.9 69.9 69.9 58.3 46.6<br />
II.<br />
FINANCIAL POSITION<br />
Gross Fixed Assets 3556.6 3985.1 3819.6 3831.7 3850.2 2105.6 1934.0 1973.8 1930.3 1912.7<br />
Net Fixed Assets 1527.3 1646.0 1719.1 1651.8 1601.6 837.2 737.7 804.8 862.9 935.0<br />
Investments 1245.0 578.4 294.3 465.0 1132.6 464.5 204.5 85.0 85.0 87.4<br />
Net Current Assets 698.5 1008.3 1164.8 1128.2 1198.7 743.5 741.5 843.3 982.1 1017.2<br />
Equity 266.6 266.6 266.6 266.6 **266.6 116.5 116.5 116.5 116.5 116.5<br />
Reserves 3211.3 2909.8 2827.6 2835.8 3054.4 1605.7 1529.6 1272.7 1200.6 1303.9<br />
Shareholders' Fund 3477.9 3176.4 3094.2 3102.4 3321.0 1722.2 1646.1 1389.2 1317.1 1420.4<br />
Loans and Deferred Payment Credits 20.5 30.9 40.7 62.1 559.4 339.4 110.4 236.4 474.0 619.2<br />
Capital Employed 3498.4 3207.3 3134.9 3164.5 3880.4 2061.6 1756.5 1625.6 1791.1 2039.6<br />
III.<br />
PER EQUITY SHARE<br />
Earnings (Rupees) #40.56 #25.31 #11.92 #12.33<br />
(Not<br />
<strong>Annual</strong>ised)<br />
15.15 13.30 28.82 12.96 7.97 7.45<br />
Dividend 25 19 10 18 11 6 6 6 5 4<br />
# After exceptional items<br />
+ Before exceptional items<br />
* Before prior period items<br />
** Including share capital suspense account<br />
*** In view of the amalgamation w.e.f. April 1, 2005, the figures of the year 2006 are not directly comparable to those of earlier years.<br />
**** Figures are for nine months ended December 31, 2006
www.clariant.in<br />
<strong>Clariant</strong> Chemicals (India) Limited<br />
Ravindra Annexe<br />
194 Churchgate Reclamation<br />
Mumbai 400 020