DECOLIGHT CERAMICS 2009-2010 (Part-1) · 2011-03-23 · DECOLIGHT CERAMICS LIMITED 2 Annual Report...
Transcript of DECOLIGHT CERAMICS 2009-2010 (Part-1) · 2011-03-23 · DECOLIGHT CERAMICS LIMITED 2 Annual Report...
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Annual Report 2009-2010 1
BOARD OF DIRECTORS Mr. GM Pethapara - Chairman & Managing DirectorMr. KM Pethapara - Jt. Managing DirectorMr. JM Pethapara - Whole-time DirectorMr. VM Vidja - Independent DirectorMr. VA Kaila - Independent DirectorMr. AH Bopaliya - Independent Director
COMPANY SECRETARY Mr. Ramachandran Pillai
AUDIT COMMITTEE Mr. VA KailaMr. VM VidjaMr. AH Bopaliya
AUDITORS SVK & ASSOCIATESChartered Accountants, Ahmedabad.
REGISTRAR AND TRANSFER AGENTS BIGSHARE SERVICES PVT. LTD.E-23, Ansa Industrial Estate, Sakivihar Road,Saki Naka, Andheri (E), Mumbai – 400 072Tel: 91-22-28470652, Email: [email protected]
BANKERS Bank of India, MorbiHDFC Bank Ltd., MorbiPunjab National Bank, MorbiING Vysya Bank Ltd., RajkotState Bank of India, Morbi
REGD. OFFICE B/h. Romer Ceramics, Old Ghuntu Road,Morbi – 363 642.
CORPORATE OFFICE B/h. Romer Ceramics, Old Ghuntu Road,Morbi – 363 642.
FACTORY LOCATIONSVITRIFIED TILES : Survey No. 650 & 651 P, Old Ghuntu Road, Morbi – 363 642.ACP UNIT : Survey No. 651 P, Old Ghuntu Road, Morbi – 363 642.WINDMILLS : M-15 & M-38,
Survey No. 84/P & 114/P,Village Khadoli,Tal.: Abdasa, Kutch.
T-1, Survey No. 283,Village Motti Sindhodi,Tal.: Abdasa, Kutch.
PHONE NO. : +91-2822-241156,+91-2822-241988
FAX NO. : +91-2822-241225
EMAIL : [email protected];[email protected]
WEBSITE : www.decocovering.com
Corporate Information
Chairman’s Message .............................................. 2
Directors’ Report .................................................... 5
Corporate Governance Report .............................16
Practicing Company Secretary’s Certificate on ......29
Auditors' Report ..................................................31
Annexure to Auditors Report ...............................32
Balance Sheet ......................................................36
Profit and Loss Account ....................................... 37
Cash Flow Statement ...........................................38
Schedules to the Accounts ...................................39
Balance Sheet Abstract .........................................59
Contents
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Annual Report 2009-20102
On behalf of the Board of Directors of Decolight
Ceramics Limited and on my personal behalf, I
extend a warm Welcome to the Eleventh Annual
General Meeting of the company.
In the beginning of the financial year 2009-10, there
remained greater optimism about India's growth
prospects. Now, as per the Government's estimates,
the Indian economy registered a growth of 7.4 per
cent in 2009-10 driven by robust performance of
the manufacturing sector on the back of
government and consumer spending.
Industry Scenario
VITRIFIED TILESCeramic Tiles, which includes Vitrified Tiles, is one
of the Building materials and its growth is dependent
on the real estate and construction activities
undergoing in the economy. Due to the global
economic slowdown and the liquidity crunch faced
by contractors and developers, activities on these
important sectors of the Indian economy declined
substantially during year 2008-09. Though the
recessionary conditions that prevailed in the
economy year ago had retarded the growth of the
real estate and construction industry, the year 2009-
10 witnessed improved real estate and construction
activities.
Vitrified Tiles, being one of the constituents building
materials for construction activities and one of the
important sectors in the Ceramic Industry, is
expected to constitute the size of Rs 2500 Cr out
of the Rs 8000 Cr Indian Ceramic Industry. The
Chairman’s Message
Greetings from Deco Group!
production capacity of Vitrified Tiles has been
increased to 3,20,000 sq mtrs per day contributed
by about 40 units which in the year 2008-09 stood
at 2,90,000 sq mtrs per day and 35 units
respectively. On global front, the consumption per
head of ceramic tiles comes to 3 to 4 sq mtr in
Europe, 1.8 sq mtr in China and 0.25 sq mtr in
India.
Taking cue from the Government's ambitious
projects lined up for the Eleventh Plan period, the
demand for construction is expected to grow by at
least 8-9%. Besides, the steps taken by the
Government of India, growing disposable income,
and the robust growth in housing loan demand
cumulatively show that real estate and construction
activities are poised for better growth in the periods
ahead. Being integral part of the economy, it is
expected that, real estate and construction industry
would see strong recovery and growth on account
of the current tempo of developments in the
country in industrialization, urbanization, economic
development and people's rising expectations for
improved quality of living. Therefore, the prospects
for the company's Vitrified Tiles business appear
to be bright and encouraging.
ALUMINIUM COMPOSITE PANELSFind use in Airport, Shopping Malls, Big Buildings
and even in residential premises structure. Owing
to high awareness of environmental concerns, the
recent trend is that more and more people now
opt for green materials. The growth in real estate
is happening in a big way with more and more
“Determination, patience and courageare necessary to improve any situation;fearing the winds of adversitydoes not make senseas a kite risesagainst the wind rather than with it”
Girishbhai M. Pethapara(Chairman & Managing Director)
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residential buildings being constructed, where the
demand for interior and exterior cladding operations
is on increasing trend. Aluminium Composite
Panels being a green material in construction
activities and customers are willing to accept green
and energy-efficient products; the introduction and
use of this product in residential premises structures
is gaining momentum and gradually would pick
up in the periods ahead.
GREEN POWERWind energy, with an average growth rate of 30%,
is the fastest growing source of renewable energy
in the world. Wind energy has demonstrated its
potential as a reliable and cost-effective source of
clean energy and economic development world
over. The Global Wind Energy Council in a recent
study produced in partnership with Indian Wind
Turbine Manufacturers Association predicts that the
wind energy potential can be as high as 2,31,000
MW, more than five times the government's
estimate. With such potential, the wind energy
sector is currently developing rapidly.
Operational PerformanceDuring the year under review, your company could
post an increase of 20% in sales turnover and the
net sales / income from operations stood at Rs
8749 lakhs as against Rs 7272 lakhs in the year
2008-09. On green power generation front, during
the year under review the company could generate
81.31 lakh units as against the previous year figure
of 78.02 lakhs units of wind power. The total
revenue implication is Rs 549.69 lakhs as against
Rs 404.79 lakhs of previous year. However, due to
rising input cost, intense competition in the vitrified
tiles segment and pricing pressures, realizations
and revenues were impacted resulting in a loss of
Rs 135.64 lakhs after tax as compared to the profit
after tax of Rs 282.24 lakhs during year 2008-09.
With the objective of reducing the cost of production
and at the same time not compromising with
quality, the company plans to import new coal stove
plant during 2010-11. Enhancing the production
capacity so as to manufacture 16,000 SMPD from
the existing 12000 SMPD looking to the robust
growth in the construction activities nowadays is
also planned. While the company has already
launched double charged vitrified tiles based on
the latest technology in the second week of April,
2010, adoption of Nano Technology for
manufacture of Nano Quality Vitrified Tiles is also
envisaged. It is believed that with these initiatives,
the company will be able to serve more customers,
increase customer base and offer products fortified
with improved quality and thus grow competitively
in the periods ahead.
Clean Development MechanismProjectAs part of environmental programmes, the
Company was contemplating development of
three Clean Development Mechanism Projects
involving a) 4.6 MW Wind Power Project; b) Fuel
switch from fossil fuel based producer gas to Natural
Gas; and c) Fuel switch over from fossil fuel to
biomass. In this context, I am pleased to inform
that the Company has received Host Country
Approval from the Ministry of Environment &
Forests, New Delhi, for all these projects. The
Projects are under Third Party evaluation at present
and it is anticipated that it would take some more
time to complete the entire procedural formalities
before being eligible to get registration from United
Nations Framework Convention on Climate
Change.
Marketing OutlookThe Building Materials segment which includes
vitrified tiles and aluminium composite panels are
likely to maintain its growth momentum as currently
construction activities on a number of projects are
on full swing coupled with renewed focus of
builders on premium / luxury housing projects. Riding
on the back of the robust growth in housing loan
demand, the housing sector is poised for a better
growth due to many factors such as growing
disposable income and steps taken by the
government to promote the housing sector. The
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company follows a dual marketing strategy
including direct sales and marketing as well as
through dealers and distributors. With the objectives
of increasing awareness, consumer interest and
steady retail marketing, the company also plans
to open up a couple of state-of-the-art display
centers in Metro cities which will be operated
through franchise agreements. The presence of a
large domestic population, along with the increase
in per capita income on the back of sustained
economic growth over the past few years is
expected to provide enough of a demand stimulus
to ensure continued economic growth for India.
Therefore the company's outlook for its vitrified
tiles appears to be encouraging.
Increasing the penetration level is one of the
cardinal requirements for the company to grow and
sustain. Penetration on a deeper scale has therefore
been planned with the plans of further exploring
potential sales points where representative display
centres can be set up, strengthening and realigning
the sales force in the marketing wing towards
exceeding customers expectations, further
strengthening delivery channels, launching new
products and increasing authorized retail network,
exploring presence in smaller geographies, etc.
In this context I am pleased to inform that the
Company successfully launched Double Charged
Vitrified Tiles based on the latest technology in
Vitrified Tiles. Tiles made out of this latest
technology bring in natural design on vitrified tiles
through powder technology. It also affords the
customers the option of choosing unlimited designs
and patterns. With the successful launching of
this product in the last week of April, 2010, the
company anticipates to get more responses in the
future as much better life span, natural design and
print nature are the basic properties of this product.
While the Indian economy is expected to record
more than 8 per cent GDP growth for the next
three years, it is anticipated that infrastructure will
continuously be the focal point for the Nation and
so the real estate and construction sector will see
strong recovery and growth.
Corporate GovernanceYour Company is committed to the continued
adoption and adherence to good Corporate
Governance practices as the Company continues
to believe that implementing good corporate
governance practices add value and thus
contribute to the overall performances.
Investor RelationsThe investors' relations were cordial during the year
under review. There were two complaints from
investors during the year under review for which
credit goes to Bigshare Services Pvt. Ltd., the
existing Registrar & Share Transfer Agent, who have
recently launched Gen-Next Investor Module i'Boss
the most advanced tool to interact with
shareholders. Please log on to i'Boss
(www.bigshareonline.com] and help them serve
you better.
ConclusionFinally, I convey my sincere gratitude to all
shareholders and stakeholders of the Company. I
also wish to place on record the support of Board
Members, Customers, Business Associations and
Employees of the Company and the cooperation
extended by the government and look forward the
same in the future too.`
On behalf of the Board of Directors of the
Company, my best wishes for the periods ahead!
Girishbhai M PethaparaChairman and Managing Director
Place : MorbiDate : 30th August, 2010
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Annual Report 2009-2010 5
Directors’ ReportTo,
The Members of Decolight Ceramics Limited
Your Directors are pleased to present their report
on the working of the company along with the
Audited Accounts for the year ended 31st March,
2010:
Financial PerformanceThe details of the financial performance of the
company are appearing in the Balance sheet,
Profit & Loss Account along with other financial
statement.
Highlights are as under:-
(Rs. In lacs)
Particulars 2009-10 2008-09
Total Income from operations 8749.25 7272.15
Profit before considering
Exceptional items, Interest,
Depreciation and Taxation 1053.85 1439.73
Less: Interest & Financial
Charges 772.75 649.44
Less: Depreciation 521.85 482.70
Profit / (Loss) before
considering Exceptional
Items and Tax (240.75) 307.59
Less: Exceptional Items 38.44 96.48
Profit/(Loss) after exceptional
items and before taxation (279.19) 211.11
Provision for taxation (143.55) (71.13)
Profit / (Loss) after Tax (135.64) 282.25
Less: Prior period items 0.17 17.74
Add: Balance of Profit
brought forward from
previous year 2115.64 1851.13
Profit available for
appropriation 1979.83 2115.64
Appropriation to: -- --
Proposed Dividend on
Equity Shares -- --
Balance Carried over to the
Balance Sheet 1979.83 2115.64
DividendYour directors do not recommend any dividend for
the year 2009-10 due to unsatisfactory financial
performance.
Business PerformanceAfter the severe slowdown witnessed in 2008-09
on account of recession the world over, the year
2009-10 turned out to be year of recovery.
Spurred by the economic revival in the domestic
market, for the year ended 31st March, 2010, the
company could post an increase of 20% in sales
turnover and the net sales / income from
operations stood at Rs 8749 lakhs as against Rs
7272 lakhs in the year 2008-09. On green power
generation front, during the year under review the
company could generate 81.31 lakh units as
against the previous year figure of 78.02 lakhs
units of wind power. The total revenue implication
is Rs 549.69 lakhs as against Rs 404.79 lakhs of
previous year.
However, to come out of the recession situation
as prevailed in year 2008-09, the company
opened up about 32 representative sales depots
in different part of the country involving
substantial expenditure in the initial year of set up
with the hope of augmenting sales and increasing
operating and net profit margins. Some of the
depots however turned out to be non-viable which
had partly contributed the company incurring
losses. The management has now decided to
close down the non-viable depots. Besides, to
compete with the competition in the wake of
increase in capacities, the company had to reduce
the prices of the products which impacted
realization and margin. With continuous focus on
improving all round efficiencies and lowering costs,
Board of Directors anticipates profitability and
growth during year 2010-11.
During the year under review, the Company's
vitrified tiles production capacity stood at 12000
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sq. mtrs. per day. There was no capacity addition
during the year.
Following is the Company's year wise Turnover for
the last five years.
TURNOVER IN RS. IN LACS
4012
5110
8123
7272
8749
2005-06
2006-07
2007-08
2008-09
2009-10
Corporate highlights
Capacity Expansion:
The current capacity of the company's
manufacturing facilities for the production of
vitrified tiles stand at 12000 sq. mtrs per day. There
was no capacity expansion during the year under
review. The present capacity of production is
running on maximum efficiency.
Looking to the robust growth in construction
activities nowadays, the management has the plan
to enhance the production capacity to 16,000
smpd.
Green Power
On Windmill Power Generation front, your
directors are pleased to inform that the company
has already installed and commissioned two WTG
of 1.25MW each and another one WTG OF 2.10
MW at Village: Kadoli, Tal.: Abdasa, Dist.: Kutch,
Gujarat, whereby taking the total Wind Mill Power
Generation capacity to 4.60 MW. The gross
generation of green power comes to 81.31 lakh
units for the year under review as against 78.02
units during year 2008-09. Units generated
thereat have been wheeled or banked through
State grids.
Environmental Priorities
As part of environmental programme, the
Company was contemplating development of
three Clean Development Mechanism Projects
involving a) 4.6 MW Wind Power Project; b) Fuel
switch from fossil fuel based producer gas to
Natural Gas; and c) Fuel switch over from fossil
fuel to biomass. It was earlier expected that the
projects become fully functional before 31st
March 2009. In this context, the Company has
received Host Country Approval from the Ministry
of Environment & Forests, New Delhi, for all these
projects in August - October 2008. While the
Projects are under Third Party evaluation at
present, it is anticipated that it would take some
more time to complete the entire procedural
formalities before being eligible to get registration
from United Nations Framework Convention on
Climate Change.
Aluminium Composite Panel
Aluminum Composite Panels (ACP) is one of the
constructions related innovative products being
used to decorate outer front of the commercial
complexes, Air ports and other commercial
buildings. The Company has started Commercial
Production of its Aluminium Composite Panel
(ACP) Unit in the last week of May 2008. The
present capacity of the unit is 25,000 Sq. Ft. per
day. With the signs of revival of the economy
already in place, I am confident that avenues for
growth and development in this new area of
business for the company will be available in the
coming periods.
Share capitalWith the completion of the Initial Public Offering
of equity shares in June 2007, presently the
company's total issued, subscribed and paid up
capital stands at Rs 18,33,54,440. The company's
shares have been listed in the Bombay Stock
Exchange Ltd. and The National Stock Exchange
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Ltd. Your Directors confirm that all due Annual
Listing Fees and Annual Custodial Fees have been
paid.
During the year under review the company
increased its authorized share capital base from
Rs 25 Crores divided in to equity shares of Rs 10
each to Rs 100 Crores divided in to equity shares
of Rs 10 each.
Allotment of equity convertiblewarrantsDuring the year under review, pursuant to the in
principle approval under clause 24(a) of the listing
agreement received by the company from BSE and
NSE, dated 18.11.2009 and 27.11.2009
respectively, the company allotted 28,237,500
equity convertible warrants on 8th December,
2009 to non-promoters at allotment money of Rs
2.75 including a premium of Re 0.25 per warrant
in conformity with SEBI (ICDR) Regulations, 2009
for preferential issue. The tenure of conversion
of the warrants is eighteen months from the date
of allotment of warrants.
Fixed depositsYour Company has not invited/accepted any Fixed
Deposits within the meaning of Section 58A of the
Companies Act, 1956 and the Rules made there
under.
Awards And RecognitionsApart from receiving the certificate / shield from
the Supdt. of Central Excise, Morbi Range, Morbi,
dated 12.05.2009 for acquiring the 2nd position /
4th position among all the vitrified tiles units / all
the tiles units, for Central Excise duty payment for
the year 2008-09; the Company has not received
any award or recognition during the year under
review.
Health, Safety, and Environment :The Company is taking continuous steps and also
developing environment friendly processes for
effective resource management with specific focus
to energy, water and basic raw materials.
Monitoring and periodic review of the HSE
Management System is done on a continuous
basis. The Company is committed to strengthen
pollution prevention and strives to provide a safe
and healthy environment. The Company has
implemented a Management System complying
with the requirements of ISO 14001:2004 for
manufacturing of Vitrified Tiles.
QualityThe company's products undergo different quality
parameter checking and the company continues
to focus on delivering products and services that
consistently meet customers' expectations. Quality
consciousness through continual development and
improvement of its all processes, procedures and
systems has been inculcated throughout the plant
of vitrified tiles unit. The Company has
implemented a Management System complying
with the requirements of ISO 9001: 2008 for
manufacturing, supply and export of vitrified tiles.
Management Discussion and Analysis ReportManagement Discussion and Analysis Report as
required under the Listing Agreement with the
Stock Exchanges is attached as Annexure 'A'.
DirectorsYour Directors wish to place on record that Dr
KN Maiti, Mr Gaurang Thoriya, and Mr Rajendra
Dhamasana, Directors of the Company, have
resigned from directorship during May 2009,
October 2009 and January, 2010 respectively.
Your Directors wish to record their deep
appreciation for the services rendered by them as
Directors of the company.
Your Board appointed Mr Vijaybhai Maganlal Vidja
and Mr Vasant Avacharbhai Kaila as Additional
Directors with effect from 19th June, 2009 and
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they have been appointed as regular Directors
(Independent) in the Annual General Meeting held
on 7th of September, 2009.
Also the Board appointed Mr Ashvin H Bopaliya
as Additional Director, on 1st January, 2010 and
he holds the office up to the date of the
forthcoming Annual General Meeting. Notice
pursuant to Section 260 of the Companies Act,
1956 has been received by the company from a
Member proposing his candidature as Director.
Considering that the Company will benefit from
his continuance as Director, his appointment is
being recommended.
In accordance with the provisions of the
Companies Act, 1956 and the Articles of
Association of the Company, Shri Kantibhai M
Pethapara, Director, and Shri Vijaybhai Maganlal
Vidja, Director, retire by rotation at the forthcoming
Annual General Meeting and are eligible for
reappointment.
Appropriate resolutions for the appointment of the
aforesaid Directors are being moved at the ensuing
Annual General Meeting for your approval.
Corporate GovernanceThe disclosures as required under the Corporate
Governance have been furnished as part of this
report. The Company has taken the requisite steps
to comply with the recommendations concerning
Corporate Governance. A report on Corporate
Governance together with a certificate of
compliance from the Practising Company
Secretary, forms part of this report.
Directors’ Responsibility StatementPursuant to the requirements under section
217(2AA) of the Companies Act, 1956, the Board
of Directors of the Company hereby state and
confirm that
(a) In the preparation of the annual accounts,
the applicable accounting standards have
been followed along with proper
explanations relating to material departure;
(b) The Directors have selected such accounting
policies and have applied them consistently
and have made judgments and estimates
that are reasonable and prudent so as to give
a true and fair view of the state of affairs of
the Company at the end of the financial year
and of the loss of the Company for the year
under review;
(c) The directors have taken proper and sufficient
care for the maintenance of adequate
accounting records in accordance with the
provisions of the Companies Act, 1956 for
safeguarding the assets of the Company and
for preventing and detecting fraud and other
irregularities;
(d) The Directors have prepared the annual
accounts on a going concern basis.
Auditors:SVK & Associates, Chartered Accountants,
Ahmedabad, Firm No. 118564W, the Auditors of
the Company, retire at the ensuing Annual
General Meeting and being eligible, offer
themselves for reappointment. The Company has
received a copy of valid Peer Review Certificate
issued by ICAI Board and letters from auditors to
the effect that their reappointment, if made,
would be within the prescribed limits under Section
224(1B) of the Companies Act, 1956 and that they
are not disqualified for such reappointment within
the meaning of Section 226 of the said Act. The
observation of the auditors referred to in the
Auditors' Report have been suitably explained in
the Notes on Accounts.
InsuranceAll the assets of the Company are adequately
insured and the policies are valid and subsisting.
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Particulars Of The Employees:Particulars of employees in accordance with
provisions of Section 217 (2A) of the Companies
Act, 1956, read with Companies (Particulars of
Employees) Rules, 1975, as amended, are not
given as none of the employees qualify for such
disclosure.
Conservation of Energy, TechnologyAbsorption and Foreign ExchangeEarning and Outgo
A) Conservation of Energy
a) Energy Conservation measures taken:
Your Company continues to be committed to
energy conservation in its manufacturing
operations.
Cost Accounting Records
Your Company is required to maintain cost
accounting records in respect of wind power
generation business and the Company has
complied with the above requirement for the
year ended 31st March 2010.
Energy Audit
During the year under review, the company
undertook energy audit from the
Government approved qualified energy
auditors M/s. Dev Engineers, Ahmedabad.
The Company implemented the various
suggestions given by the energy auditors
during the year under review.
b) Some significant Energy conservation
measures implemented in the recent past
are:
1. The company continues to maintain monthly
average power factor towards saving in
electricity cost.
2. All the three wind mills of the company have
been functioning aggregating to a total
capacity of 4.6 MW. Units generated thereat
have been wheeled or banked through State
grids which augur well towards reduction in
energy cost.
3. The Company continues to reduce the
firing cost of Tiles driers by effective recovery
of waste heat for using in Roller Kilns and
for this the company on a regular basis
identified leakage points and necessary
prevention / rectification is done / being
done .
4. The Company made regular maintenance to
plant and machinery in addition to design
modifications in the machinery and allied
equipments to aid in conservation of energy
and improvement in operational efficiency.
5. The instructions of the energy auditor have
been disseminated throughout the vitrified
and aluminium composite panels plants with
the objective of creating awareness towards
effective conservation of energy and
reduction of costs.
6. The Company also uses the energy saving
techniques by using the waste steam
converting into vapors and then reusing the
same in cooling and filtering the Coal gas.
7. To reduce the company's Spray Dryer fuel
cost further, the company is in the process
of importing a new Coal Stove.
c) Impact of the measures
Total fuel cost during the year was
Rs.2764.85 lacs while the same was Rs.
2630.83 lacs in the last year. During the
year under review the company could
generate 81.31 lakh units of wind power
against 78.02 lakhs units of wind power in
previous year. The total revenue implication
is Rs 549.69 lakhs as against Rs 404.79 lakhs
of previous year.
Following are the details of power cost per ton of
production:
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Annual Report 2009-201010
way for efficient use of resources and
increase in production / productivity.
The company is continuously studying
through its R&D wing to further save in
the KILN cycling time.
3. Regular overhauling and upgrading of
the machinery resulted in improvement
in capacity utilization of machineries to
the extent of 12%.
4. Routine and Preventive Maintenance
carried out to its Auxilassing Calibrating
Machine reflected improved quality
and product life in the products of the
company in addition to reduction in the
consumption of abrasives and
electricity.
5. The company uses CNG in its
manufacturing facilities which promote
environmental cleanliness, leads to
more efficiency and less polluting.
6. The above measures continue to
contribute conservation of resources
and reduction in pollution and costs,
productivity enhancement, improved
product quality and eco-friendly
products.
Future Plan of action
1. Replacing the old technology polishing
line with the latest technology and
longer length polishing line. This will
contribute to improvement in quality,
reduction in energy consumption,
saving in working hours, and reduced
use of abrasives leading to cost savings
in production.
2. Introduction of Nano Technology
backed machinery for manufacturing of
high Nano quality Vitrified Tiles.
Year Production Total Power Power cost(Tons) Cost incurred per ton / Rs
/Rs(Net of (Net of windwind power) power)
Vitrified Tiles Unit / MT
2005-06 33466 128,247,057 3832.16
2006-07 40583 161,802,924 3986.96
2007-08 53928 212,304,984 3936.75
2008-09 47159 221,340,254 4693.00
2009-10 61981 220,078,014 3550.73
Aluminium Composite Panels Unit / Sq Mtr
2008-09 31890 Sq/Mtr 12,63,249 39.61/Sq Mtr
2009-10 40703 Sq/Mtr 14,38,241 35.34/Sq Mtr
B) Technology absorption:Efforts made in technology absorption:
a) Research & Development (R & D)
1. The Company continues to pursue its
research and development efforts in the
areas of product concept development,
raw material usage giving priority to
local contents and product features and
product quality improvement, reduction
in the Kiln cycling time of Vitrified
Tiles, etc. and is adequately equipped
with its own R&D Department with
qualified manpower.
Benefits derived as a result of the above
R & D
1. During the year under review, the
company continued to use local clay
and for this the Company has been
receiving cooperation from Central
Glass & Ceramic research Institute
(CGCRI), Naroda, Ahmedabad, for the
development of local Indian clay.
Consequently, local contents of the
product increased and import of
Ukraine Clay becomes nil.
2. The KILN cycling time of tiles was 55
minutes previously which has been
reduced to 45 minutes whereby paving
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Annual Report 2009-2010 11
3. Introduction of Heavy Duty Tile Press
capable of manufacturing larger size
Vitrified Tiles of 8'x4'.
Expenditure on R & D tentatively
planned
a) Capital Expenditure Rs 2.00 Cr
b) Recurring Rs 0.30 Cr
c) Total Rs 2.30 Cr
b) Technology absorption, adaptation
and innovation
The company is using Chinese and
Spanish technologies in its
manufacturing facilities.
The benefits derived are reflected in
the products of the company in the
form of improved product features,
quality, product life, and better hygienic
contents.
Technology imported during the last
five years reckoned from the beginning
of the financial year:
a. Technology imported : Yes
(Chinese and Spanish)
b. Year of import : 2004
c. Has technology been fully
absorbed? : Yes
C) Foreign Exchange 2009-10 2008-09
Earning & Outgo
1. Total foreign
exchange 4,09,446 15,48,246
earned Rs.
2. Total foreign
exchange 501.76 387.94
used Rs. in lakhs
Industrial / Human Relations:
The Industrial relations during the year under
review continue to remain cordial between the
workers and management. The Management
appreciates the employees of all cadres for their
dedicated service to the Company, and expects
continued support for higher level of productivity
in achieving the targets set for the future. The
Company continued its efforts in the HR policies
and processes to further its performance.
Acknowledgement:
Your Directors place on record their sense of
appreciation for the co-operation received from
the Banks, Financial Institutions, Employees,
Customers and Suppliers of the Company at all
levels during the year under review.
For and on behalf of Board of DirectorsSd/-
Place : Morbi Girishbhai M. PethaparaDate : 30th August, 2010 Chairman
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Annual Report 2009-201012
Annexure A to the Directors’ ReportManagement’s Discussion and Analysis
Financial Highlights
Highlights are as under:-
(Rs. In lacs)
Particulars 2009-10 2008-09
Total Income from operations 8749.25 7272.15
Profit before considering
Exceptional items, Interest,
Depreciation and Taxation 1053.85 1439.73
Less: Interest & Financial
Charges 772.75 649.44
Less: Depreciation 521.85 482.70
Profit / (Loss) before
considering Exceptional
Items and Tax (240.75) 307.59
Less: Exceptional Items 38.44 96.48
Profit / (Loss) after
exceptional items and before
taxation (279.19) 211.11
Provision for taxation (143.55) (71.13)
Profit / (Loss) after Tax (135.64) 282.25
Less: Prior period items 0.17 17.74
Add: Balance of Profit
brought forward from
previous year 2115.64 1851.13
Profit available for
appropriation 1979.83 2115.64
Appropriation to: -- --
Proposed Dividend on
Equity Shares -- --
Balance Carried over to the
Balance Sheet 1979.83 2115.64
Segment informationSegments’ information are given along with
financial statements. The company has
identified two segments viz “Manufacturing and
Trading of tiles and other building materials” &
“Wind Power Generation”. The major and
material activities of the company are restricted
to only one geographical segment i.e. India,
hence the secondary segment disclosure is not
applicable.
Industry Structure & Developments :
Vitrified Tiles: The total size of the Indian
ceramic industry is around Rs 8000 Cr and out
of this vitrified tiles segment constitutes the size
of Rs 2500 Cr. The production capacity of
vitrified tiles has been increased to 3,20,000 sq
mtrs per day contributed by about 40 units
which in the year 2008-09 stood at 2,90,000 sq
mtrs per day and 35 units respectively. On
global front, the consumption per head of
ceramic tiles comes to 3 to 4 sq mtr in Europe,
1.8 sq mtr in China and 0.25 sq mtr in India.
The demand for vitrified tiles is driven by the
developments and growth in construction, realty
and infrastructure sectors. On the backdrop of
encouraging growth on employment front, rising
incomes and benign interest rates, home
buyers’ sentiment has turned positive in the past
few months. Besides, with increased purchasing
power of the Indian populace, consumption per
head is expected to increase. On the back of
these developments, demand for residential
space is expected to pick up and the demand
for Vitrified Tiles of the company is expected to
surge. With the awareness of the Vitrified Tiles
expected to increase since the modern flooring
has witnessed a paradigm shift from
conventional designing to contemporary and
innovative outlooks; the company foresees
bright prospects for its vitrified tiles business as
the invaluable aura and elegance of vitrified
tiles flooring is distinctly visible. Globally the
vitrified tiles segment has been growing at a
rate of 18% per annum over the past three
years, accounting for around 10 – 12% of the
total tile production.
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Annual Report 2009-2010 13
Aluminium Composite Panel: Aluminium
Composite panel is one of the preferred choices
of materials for construction industry. It can be
used as roofing and cladding sheet for
industries, warehouses and godowns. Being a
revolutionary and versatile new decorative
building material widely used in interior and
exteriors of buildings as curtain walls, paneling
and cladding applications; it offers innovative,
modern, beautiful, creative and practical design
possibilities for a variety of applications
including panel for modern high rise buildings
satisfying every need of architects, engineers,
contractors and building owners. As this
product is newly introduced in the market, there
are very few players. Wider acceptance and
application of this product could be found in
Europe, USA and China while in India the
awareness to be built up gradually.
Green Power: Wind energy, with an average
growth rate of 30%, is the fastest growing
source of renewable energy in the world. Wind
energy has demonstrated its potential as a
reliable and cost-effective source of clean
energy and economic development world over.
The Global Wind Energy Council in a recent
study produced in partnership with Indian Wind
Turbine Manufacturers Association predicts that
the wind energy potential can be as high as
2,31,000 MW, more than five times the
government’s estimate. With such potential,
the wind energy sector is currently developing
rapidly. India occupies the fifth place in the
world in wind energy generation after USA,
Germany, Spain, and China and has an installed
capacity of more than 9756 MW. New
technological developments in wind energy
design have contributed to the significant
advances in wind energy penetration and to get
optimum power from available wind. Today
India is a major player in the global wind energy
market. The potential is far from exhausted.
Estimates show that with the current level of
technology, the ‘on-shore’ potential for
utilization of wind energy for electricity
generation is of the order of 65,000 MW. The
unexploited resource availability has the
potential to sustain the growth of wind energy
sector in India in the years to come.
Company Outlook:
Vitrified Tiles: The vitrified tiles segment is
likely to maintain its growth momentum as
currently construction activities on a number of
projects are on full swing coupled with
renewed focus of builders on premium housing
projects. Riding on the back of the robust
growth in housing loan demand, the housing
sector is poised for a better growth due to many
factors such as growing disposable income and
steps taken by the government to promote the
housing sector. The company follows a dual
marketing strategy including direct sales and
marketing as well as through dealers and
distributors. The presence of a large domestic
population, along with the increase in per capita
income on the back of sustained economic
growth over the past few years is expected to
provide enough of a demand stimulus to ensure
continued economic growth for India. Therefore
the company’s outlook for its vitrified tiles
appears to be encouraging.
Aluminium Composite Panels find use in
Airport, Shopping Malls, Big Buildings and even
in residential premises structure. Owing to high
awareness of environmental concerns, the
recent trend is that more and more people now
opt for green materials. The growth in real
estate is happening in a big way with more and
more residential buildings being constructed,
where the demand for interior and exterior
cladding operations is on increasing trend.
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Annual Report 2009-201014
Aluminium Composite Panels being a green
material in construction activities and customers
are willing to accept green and energy-efficient
products; the company expects good business
opportunities in the Aluminium Composite
Panels business.
Green Power
On Windmill Power Generation front, the
company has already installed and
commissioned two WTG of 1.25MW each and
another one WTG OF 2.10 MW at Village:
Kadoli, Tal.: Abdasa, Dist.: Kutch, Gujarat,
whereby taking the total Wind Mill Power
Generation capacity to 4.60 MW. The gross
generation of green power comes to 81.31 lakh
units for the year under review as against 78.02
units during year 2008-09. Units generated
thereat have been wheeled or banked through
State grids. Anticipating availability of strong
and dependable winds at most of the time to
continue, the outlook on wind power generation
front appears to be bright.
Opportunities and Threats:
The Company successfully launched Double
Charged Vitrified Tiles based on the latest
technology in Vitrified Tiles. Tiles made out of
this latest technology bring in natural design on
vitrified tiles through powder technology. It also
affords the customers the option of choosing
unlimited designs and patterns. With the
successful launching of this product in the last
week of April, 2010, the company anticipates to
get more responses in the future as much better
life span, natural design and print nature are the
basic properties of this product.
The company has plans to introduce Nano
Technology backed machinery for
manufacturing high Nano Quality Vitrified Tiles.
Nano Vitrified Tiles can be targeted to high end
customers for construction of modern house and
villas in posh localities, modern commercial
complexes, and other contemporary and
innovative outlooks / flooring, etc. Emergence
of Nano Technology backed vitrified tiles would
fetch better price realization in terms of sq. ft.
of tiles. Also envisaged is the proposal to
open up a couple of Modern Display Centres in
major cities towards creating greater awareness
of the company’s range of products, steady
retail marketing and to build up the brand
image of the company’s product and perk up
consumer interest in the company’s products.
With the launching of Double Charged Vitrified
Tiles and the proposal to introduce Nano Quality
Vitrified Tiles and further some decorative and
attractive fancy tiles items targeted for high end
clients expected to launch soon, better
realization is anticipated and the products
portfolio in ceramic tiles offered by the company
is to become richer and to find applications in
all kinds of set up and finals whereby affording
customers more option and choices.
With the government last year imposing
antidumping duty on Chinese imports for
another five years coupled with increasing
awareness of the advantages of the vitrified tiles
over traditional marbles and tiles; the company
finds bright opportunities for its product
domestically. The company also anticipates
incremental retail off-take and spurt in real
estate and construction activities during year
2010-11.
The GST is expected to be rolled out from the
next fiscal and will replace a plethora of state
levies and central levies with a one tax. This
would help create a national market.
In the background of new entrants on vitrified
tiles segment and further increases in capacities,
competition is bound to increase. The industry
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Annual Report 2009-2010 15
has biggest competition from China which has
huge volumes and therefore Indian players in
vitrified tiles overseas markets are facing
difficulties to compete with China.
Risks & Concerns
Higher input costs due to the cascading effect of
inflation vis-à-vis manufacturing sector may
contribute to shrinking of margins.
On export front, upward spiral in the cost of
inputs and energy adds to the industry woes and
make the cost of production 15% more than
China which does not help the players in the
export markets.
With the impending transition to GST in April
2011, a fundamental question haunting the
ceramic tiles industry would be whether the tax
sops currently available would be continued
under GST, which is based on the principle of
minimal exemptions / concessions.
On wind power generation front, non-availability
of strong and dependable winds at most of the
time coupled with unprecedented climatic
variations may affect output generation.
On Clean Development Mechanisms projects,
the impending procedural delays may lead to
lagging behind the schedules set forth by the
company for achievement.
Internal Control Systems and their
adequacy:
The Company has a well structured internal
control mechanism and the same is monitored
by the internal auditor of the company who
reviews and strengthens the control measures
periodically. The Internal Audit team regularly
briefs the Management and the Audit
Committee on their findings and also on the
steps to be taken with regard to deviation, if
any.
The company’s internal control systems and
their adequacy is based on the nature of
business and size of operations and the
Company’s internal control system has been
designed to provide for:
q Accurate recording of transactions with
internal checks and prompt reporting
q Adherence to applicable Accounting
standards and policies
q Review of capital investments and long
term business plans
q Periodic review meetings to guide
optimum utilization of resources
q Compliance with applicable statutes,
policies, l isting requirements and
management policies and procedures
q Effective use of resources and safeguarding
of assets
Cautionary StatementThe statement in this report may be forward looking
within the meaning of applicable laws or regulations.
These statements are made on certain assumptions and
expectations of future events. Actual results could
however differ materially from those stated above. The
Company and its Board of Directors assume no
responsibil ity in respect of the forward looking
statements herein which may undergo changes in future
on the basis of subsequent developments, information
and events.
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Annual Report 2009-201016
The report on Corporate Governance is pursuant to Clause 49 of the Listing Agreement entered intowith the Stock Exchanges and forms a part of the report of the Board of Directors. Your Companyhas complied in all respects with the applicable Corporate Governance Code as per Clause 49 ofthe Listing Agreement with the Stock Exchanges. A Report on the Corporate Governance complianceis furnished below:
1. Corporate Governance Philosophy:Your Company is committed to the continued adoption and adherence to good CorporateGovernance Practices, which shall ensure that all the concerned parties associated with theCompany obtain requisite information, which would help them to make positive decision. SuchCorporate Governance practices help enhance long-term shareholder value and interest of otherstakeholders.The Board fully appreciates the need of increased awareness for responsibility, transparency andprofessionalism and focus for effective control and management of the organization. TheCompany has adequate number of independent directors and also has formed variouscommittees.
2. Board of Directors:The Board of Directors has a mix of Executive and Non executive Directors. Presently the Boardcomprises of three Executive directors including the Chairman and three Non Executive Directorswhich are also independent directors. Except Managing Director Shri Girishbhai M. Pethapara,the other Directors are liable to retire by rotation.Except the three Executive Directors, who are brothers inter se, there is no relationship betweenthe independent directors and all the directors are above 21 years of age and possess therequisite qualifications and experience useful to the company in their capacity as directors.
The composition of the Board and other relevant details relating to Directors are given below:
Name of Director Category No. of other No.of other Committee No.of Board Attendance Directorships* memberships* Meetings at last
Chairman Director Chairman Member attended AGM
Mr. G.M.Pethapara Promoter, 1 1 None None 15 Yes(Chairman) Executive
Mr. K.M.Pethapara Promoter 1 2 None None 14 YesExecutive
Mr. J.M.Pethapara Promoter None 2 None None 15 YesExecutive
Mr. R.G.Dhamasana Independent None None None None 7** YesNon-Executive
Mr. G.M.Thoriya Independent None None None None 3*** YesNon-Executive
Mr Vijay Maganlal Independent None None None None 12**** YesVidja Non-Executive
Mr Vasant Avachar Independent None None None None 12**** YesKaila Non-Executive
Mr Ashvin H Independent None None None None 4***** N.A.
Bopaliya Non-Executive
[N.A. – Not Applicable]*Note: Excludes Directorships in Private Limited Companies, Non Profit Making Companies, Foreign Companiesand Government Bodies, if any.** resigned with effect from 1ST January, 2010*** resigned with effect from 15th October, 2009**** appointed with effect from 19th June, 2009***** appointed with effect from 1st January, 2010
Corporate Governance Report
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Annual Report 2009-2010 17
During the year 2009-10 Director Dr KN Maiti resigned effective from 1st May, 2009. Also Mr. G.M.
Thoriya has resigned from the directorship with effect from 15.10.2009. With effect from 1st January,
2010, Independent Director / Chairman of Audit Committee Mr R. G. Dhamasana has resigned.
The Board appointed Mr Vijay Maganlal Vidja and Mr Vasant Avachar Kaila as Additional Directors
effective from 19th June, 2009 and in the Annual General Meeting of the Members held on 7th
September, 2009 these directors were appointed as regular directors (independent). The Board also
appointed Mr Ashvin H Bopaliya as Additional Director effective from 1st January, 2010. The
appointment of new independent directors is within the period of 180 days
Last Annual General Meeting was held on 7th September, 2009.
Directors appointment / reappointment
Mr Kantibhai M Pethapara, Director, and Mr Vijaybhai Maganlal Vidja, Director, of the Company,
retire by rotation and, being eligible, offer themselves for re-appointment. Details of the directors
seeking appointment / reappointment as required under Clause 49 IV(G) (i) are given in the annexure
to the Notice of the 11th Annual General Meeting to be held on 29th September, 2010.
Mr Ashvin H Bopaliya was appointed as Additional Director (Independent) in the Board Meeting held
on 1st January 2010. Under Section 260 of the Companies Act, 1956 read with Article 141 of the
Articles of Association of the Company his appointment is valid only up to this Annual General
Meeting. Notice as required under Section 257 of the Companies Act, 1956 together with the deposit
of Rs 500/- has been received by the Company from a member signifying his intention to propose
the appointment of Mr Ashvin H Bopaliya as Director of the Company.
Appropriate resolution for the appointment / reappointment of the aforesaid Director is being moved
at the ensuing Annual General Meeting.
Attendance of Directors at AGM
All the three Promoter Executive Directors attended the AGM and the Chairman of Audit Committee
also attended at the meeting.
Board Meetings
During the year 2009-10 total 15 board meetings were held on dates: 02.04.09, 20.05.09, 19.06.09,
25.06.09, 31.07.09, 29.09.09, 14.10.09, 01.11.09, 08.12.09, 11.12.09, 01.01.10, 29.01.10,
16.02.10, 18.03.10 and 31.03.10
Code of Conduct:
The Company has adopted Code of Conduct for all the Directors and Senior Management of the
Company. The Code of Conduct is posted on the Website of the company. All the Board Members
and senior management of the Company have affirmed compliance with Code of Conduct. The
declaration on adopting the code of conduct is given elsewhere in the report.
Code for prevention of insider trading practices
In compliance with the SEBI regulation on prevention of Insider Trading, the Company has framed
a code of conduct for prevention of insider trading to be observed by the Directors, Officers and
Designated Employees of the Company.
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Annual Report 2009-201018
Audit Committee:
The Composition of Audit Committee as on 31.03.2010
Mr Mr Vijay Maganlal Vidja — Chairman w.e.f. 1st Jan, 2010
Mr Vasant Avachar Kaila, — Member
Mr Ashvin H Bopaliya — Member*
Mr. Rajendra G. Dhamasana — Chairman**
Mr. Gaurang Thoriya — Member***
*appointed w.e.f. 1st January, 2010
**ceased to be chairman / member with effect from 1st January, 2010
***ceased to be member effective from 15th October, 2009
All the members of the Committee have exposure in the relevant areas. The Committee has been
reconstituted on 1st January, 2010, due to change in the composition of the Board of Directors, with
Mr Vasant Avachar Kaila, as Chairman, and Vijay Maganlal Vidja and Mr Ashvin H Bopaliya, as
members. The Composition of the Committee is in conformity with Clause 49 (II)(A) of the Listing
Agreement.
Role & Terms of Reference
The role and terms of reference of the Audit Committee broadly are as under:
i. Overseeing the Company’s financial reporting process and to ensure that the financial
statements are correct, sufficient and credible.
ii. Recommending to the Board, the appointment, reappointment or removal of statutory auditor,
fixation of audit fees and for other services.
iii. Reviewing with the management, the quarterly and annual financial statements before
submission to the Board for approval.
iv. Reviewing the adequacy of internal audit function including the structure of the internal audit
department, staffing and seniority of the official heading the department, reporting structure
coverage and frequency of internal audit.
v. Discussion with internal auditors any significant findings and follow up there on.
vi. Reviewing the findings of any internal investigations by the internal auditors into matters where
there is suspected fraud or irregularity or a failure of internal control systems of a material
nature and reporting the matter to the Board.
vii. In addition to the above, all items listed in Clause 49(II)(D) of the Listing Agreement.
viii. Looking into any other matters as may be required by the Companies Act, 1956 or by rules
framed thereunder.
ix. Reviewing the functioning of Whistle Blower Mechanism.
x. Appointment of CFO
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Annual Report 2009-2010 19
Meetings held:
There are in all five Audit Committee Meetings held during the financial year 2009-10. The dates
of meeting: 20.05.2009, 25.06.2009, 31.07.2009, 14.10.2009, and 29.01.2010
Name Meetings held Attendance
Mr Vasant Avachar Kaila — Chairman 4 4
Mr Vijay Maganlal Vidja — Member 4 4
Mr Ashvin H Bopaliya — Member 1 1
Mr. Rajendra G. Dhamasana — Chairman* 4 4
Mr. Gaurang Thoriya — Member** 4 1
Mr KM Pethapara — Jt. M.D.(invitee) 5 5
*ceased to be chairman / member with effect from 1st January, 2010
**ceased to be member effective from 15th October, 2009
The Jt. Managing Director who is looking after the finance matter, Chief Accountant and
Internal Auditor of the Company were special invitees to the audit committee meeting and
they attended the meeting.
The Company Secretary of the Company is the Secretary to the Committee.
3. Remuneration Committee:Composition of the Remuneration Committee:
Mr Vasant Avachar Kaila — Chairman
Mr Vijay Maganlal Vidja — Member
Mr Ashvin H Bopaliya — Member
Mr KM Pethapara — Jt. M.D (Invitee)
The Committee has been reconstituted on 1st January, 2010 with Mr Vasant Avachar Kaila, as
Chairman, and Vijay Maganlal Vidja and Mr Ashvin H Bopaliya, as members.
Terms of Reference
q To recommend to the Board, the remuneration packages of the Company’s Managing/ Joint
Managing/ Deputy Managing/ Whole time/ Executive Directors, including all elements of
remuneration package (i.e. salary, benefits, bonuses, perquisites, commission, incentives, stock
options, pension, retirement benefits, details of fixed component and performance linked
incentives along with the performance criteria, service contracts, notice period, severance fees
etc,);
q To be authorized at its duly constituted meeting to determine on behalf of the Board of
Directors and on behalf of the shareholders with agreed terms of reference, the Company’s
policy on specific remuneration packages for Company’s Managing/ Joint Managing/ Deputy
Managing/ Whole time/ Executive Directors, including pension rights and any compensation
payment;
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Annual Report 2009-201020
Attendance during the year
One meeting of the committee was held on 31.03.2010.
Details of remuneration paid to the Directors during the financial year 2009-10
Executive Directors:
Name of Director Salary & Perquisites (Rs. in lakhs)*
Shri Girishbhai M. Pethapara NIL
Shri Kantibhai M. Pethapara NIL
Shri Jayantibhai M. Pethapara NIL
Non-Executive Directors:
Name of Director Sitting Fees (Rs. In lakhs )
Mr. Gaurang Thoriya 0.15
Mr. Rajendra G. Dhamasana 0.40
Mr Vasant Avachar Kaila 0.60
Mr Vijay Maganlal Vidja 0.60
Mr Ashvin H Bopaliya 0.20
* In view of inadequacy of profit and overdues with the Bankers, the three Executive Directors
have not been paid any salary & perquisites during the year 2009-10.
Remuneration Policy
The Company while deciding the remuneration package takes into consideration, the following:
q Employment scenario.
q Remuneration package of the industry / other industries for the requisite managerial talent.
q The qualification and experience held by the appointee.
4. Shareholders'/ Investors' Grievance Committee:
The composition of Shareholders'/Investor' Grievance Committee is as under:
Mr. Rajendra G. Dhamasana — Chairman*
Mr. Gaurang Thoriya — Member**
Mr Vasant Avachar Kaila, — Chairman from 01.01.2010
Mr Mr Vijay Maganlal Vidja — Member
Mr Ashwin H Bopaliya — Member
*ceased to be member/chairman with effect from 1st Jan, 2010
**ceased to be member with effect from 15th Oct., 2009
The Committee has been reconstituted on 1st January, 2010 with Mr Vasant Avachar Kaila, as
Chairman, and Vijay Maganlal Vidja and Mr Ashvin H Bopaliya, as members. The Chairman
of the Committee was present in the last AGM of the Company.
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Annual Report 2009-2010 21
Terms of Reference
Brief summary of terms of reference is to deal with the transfer of shares, issue of duplicateshare certificates, dematerialization of shares, remat of shares, redressal of all investorgrievances and complaints generally. As on 31st March, 2010 there were no complaints pendingto be addressed by the Shareholders / Investors’ Grievance Committee.
Status of complaints
During the year 2009-10 the company received two complaints. As of 31st March, 2010, nocomplaints were pending to be resolved.
The Committee held four meetings on date 31.07.2009, 14.10.2009, 29.01.2010 and31.03.2010 and all the Members including Chairman were attended in the meeting:
Name Meeting held Attendance
Mr Vasant Avachar Kaila, — Chairman 4 4(from 01.01.2010)
Mr Mr Vijay Maganlal Vidja — Member 4 4
Mr Ashwin H Bopaliya — Member# 2 2
Mr. Rajendra G. Dhamasana — Chairman* 2 2
Mr. Gaurang Thoriya — Member** - -
Mr KM Pethapara — Jt. M.D. 4 4
#appointed with effect from 1st Jan, 2010*resigned with effect from 1st Jan 2010
**resigned with effect from 15th Oct., 2009
Name and designation of Compliance Officer : Mr Ramachandran PillaiCompany Secretary & Compliance Officer
5. Details of General Body Meetings:
Location, date and time of General Meetings held during the last 3 years:
Annual General Meeting:
Year Location Date Day Time No. of SpecialResolutions
2006-07 Regd. Office : 11.05.2007 Friday 12.30 pm 1B/h. Romer Ceramic,Old. Ghuntu Road,Morbi – 363642.
2007-08 Adarsh Hotel, 8A, 05.08.2008 Tuesday 12.30 pm NILNational Highway,Opp: Shakti Chambers,Morbi – 363 642
2008-09 Regd. Office : 07.09.2009 Tuesday 12.30 pm 2B/h. Romer Ceramic,Old. Ghuntu Road,Morbi – 363642
Extra Ordinary General Meeting Held after the last AGM
2009-10 Regd. Office : 17.03.2010 Wednes- 11.00 am 1B/h. Romer Ceramic, dayOld. Ghuntu Road,Morbi – 363642
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Annual Report 2009-201022
The following Special Resolutions were passed
Year 2006-07
1) Appointment of Managerial Personnel Under Section 314(1) of the Companies Act, 1956
Year 2008-09
1) Issue of equity convertible warrants on preferential basis
2) Enabling Resolution for QIP/GDR/ADR/FCCB Issue
Year 2009-10 (EGM)
1) Enabling Resolution increasing the limit of QIP/GDR/ADR/FCCB Issue
In the last year none of the resolutions was required to be put through postal ballot.
6. Disclosures:
Related party transactions:
The Company has not entered into any transactions of material nature, with its promoters, the
directors, the management, their subsidiaries or relatives etc. that may have potential conflict
with the interests of the Company at large. The disclosures in respect of related party
transactions are provided in the notes to the accounts. All contracts with the related parties
entered into during the year which are in the normal course of business and have no potential
conflict with the interest of the Company at large and are carried out on an arm’s length basis
at fair market value.
Disclosure of accounting treatment:
The Company has followed all relevant and applicable Accounting Standards while preparing
the financial statements.
Risk Management
The company periodically reviews its risk assessment and minimization procedures so as to
ensure that executive management controls risk through means of a properly defined
framework. Executive management of the company periodically places before the Audit
Committee risk identification report and risk mitigation measures. The properties of the
company are adequately insured from risk and where risk transfer is not practicable, such risks
are retained and effectively controlled.
Statutory Compliance, penalties.
There have been no instances of non-compliance on any matter related to the capital markets
since the company entered in to the capital market. As such no penalty has been imposed
on the Company by any statutory authority on matter relating to capital markets during the last
three years. The company’s shares were listed in Bombay Stock Exchange and National Stock
Exchange in June 2007.
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Annual Report 2009-2010 23
As reported earlier in this part of the report, the company had been served with a show cause
notice for Rs 4.91 Cr. by DGCEI, Ahmedabad, in furtherance of the search operations carried
out by the DGCEI, Ahmedabad, in the month of March 2008. Besides, in connection with the
search operations, during March 2008 the company paid Rs 4 crore under protest towards bail
conditions of the two directors. In addition to this, as per the recent High Court Order
consequent upon remand back of the case to lower Court, the Directors / Company submitted
Solvency Certificate to the Lower Court in the sum of Rs 3.25 Cr pending adjudication of the
case by Central Excise Authorities.
Proceeds of Initial Public Offer
With the completion of the Initial Public Offering of equity shares in June 2007, presently the
company’s total issued, subscribed and paid up capital stands at Rs 18,33,54,440. The
company’s shares have been listed in the Bombay Stock Exchange Ltd. and The National Stock
Exchange Ltd.
Preferential Issue
Pursuant to the in principle approval under clause 24(a) of the listing agreement received by
the company from BSE and NSE, dated 18.11.2009 and 27.11.2009 respectively, the company
has allotted 28,237,500 equity convertible warrants on 8th December, 2009 at allotment
money of Rs 2.75 including a premium of Re 0.25 per warrant and intimation whereof has
been given to both the stock exchanges, CDSL and NSDL, regarding the allotment in conformity
with SEBI (ICDR) Regulations, 2009 for preferential issue
Disclosure of unclaimed shares
The company has no unclaimed shares in the suspense account hence the information as per
the Clause 5A of the listing agreement has not been provided / applicable.
7. Means of Communication:The website of the Company www.decocovering.com acts as the primary source of information
regarding the activities, nature of businesses etc. of the Company. Dedicated email id for
communication [email protected]. Quarterly and half-yearly financial results were
published in two news papers Financial Express and Indian Express and the same are also
available with the company’s website and stock exchanges website where the companies shares
are listed.
8. General Shareholders Information:
9.1 Annual General Meeting:
Date, Time and Venue of Annual General Meeting
Date : Wednesday, 29th September, 2010
Time : 12.30 p.m.
Venue : Registered Office
B/h. Romer Ceramic,
Old Ghuntu Road,
Morbi – 363642
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Annual Report 2009-201024
9.2 Financial Year:
The Company’s financial year is based on twelve months starting from April to March.
Financial Calendar : Q1 Results FY 2010-11 by August’10 2nd week
: Q2 Results FY 2010-11 by October’ 10 last week
: Q3 Results FY 2010-11 by January’11 last week
: Q4 Results FY 2010-11 by April’11 last week
9.3 Dates of Book Closure:
The Register of Members and Share Transfer Books of the Company shall remain closed from
Tuesday, 28th of September, 2010 to Wednesday, the 29th of September, 2010, both days
inclusive for AGM purposes.
9.4 Dividend Payment Date:
Not Applicable since the Board has not recommended any dividend for the year 2009-10.
9.5 Listing on Stock Exchanges:
The company’s shares are listed in the following stock exchanges:
a.) The Bombay Stock Exchange Limited (BSE), Scrip Code: 532858
b.) The National Stock Exchange Of India Limited (NSE) : Symbol: Decolight
SHARE DISTRIBUTION AS ON 31.03.2010
Range Total % of Total Total Holding % of Total
Holders Holders Capital
1 - 5000 11,145 97.83181 53,46,855 29.16131
5000 - 10000 133 1.16749 9,73,640 5.31015
10001 - 20000 49 0.43013 7,07,645 3.85944
20001 - 30000 22 0.19312 5,39,191 2.94070
30001 - 40000 6 0.05267 2,14,250 1.16850
40001 - 50000 4 0.03511 1,74,829 0.95350
50001 - 100000 11 0.09656 8,11,453 4.42560
100001 - 99999999 22 0.19312 95,67,581 52.18080
Total : 11,392 1,83,35,444
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Annual Report 2009-2010 25
SHAREHOLDING PATTERN AS ON 31.03.2010
Category No. of shares held % of holding
A Promoter and Promoter Group
Individuals / Hindu Undivided
Family 4,062,888 22.16
Bodies Corporate 500,000 2.73
Sub Total 4,562,888 24.89
B Public Shareholding
1 Institutions
Foreign Institutional Investors 215,507 1.18
2 Non-Institutions
a) Bodies Corporate 4,777,920 26.06
b) Individuals holding nominal 5,569,642 30.38
share capital up to Rs 1 lakh
c) Individual shareholders 2,727,948 14.88
Others
i) Non-Resident Indians 447,067 2.44
ii) Clearing Member 34,472 0.19
Sub Total 13,772,556 75.11
Grand Total (A+B) 18,335,444 100
STOCK MOVEMENT DATA
BOMBAY STCOK EXCHANGE NATIONAL STOCK EXCHANGE
Month High Low Monthly High Low Monthly
(Rs.) (Rs.) Volume (Rs.) (Rs.) Volume
(No.of shares) (No.of shares)
April 2009 10.33 6.05 16,35,872 10.20 6.10 1,02,937
May 2009 14.25 7.31 40,07,149 14.50 7.20 4,16,865
June 2009 17.00 10.62 48,24,968 16.70 10.65 2,35,184
July 2009 11.10 8.70 72,65,247 11.20 8.90 98,147
Aug 2009 11.90 9.27 19,52,275 11.80 9.40 1,22,419
Sept 2009 12.98 10.87 35,02,926 13.00 10.75 2,12,960
Oct 2009 12.24 9.20 18,21,738 12.25 9.00 1,39,395
Nov 2009 10.21 8.67 8,36,865 10.40 8.55 80,307
Dec 2009 11.84 9.14 25,84,164 11.80 9.00 2,06,223
Jan 2010 14.06 9.72 2,75,27,183 14.25 9.55 19,24,891
Feb 2010 14.51 8.93 7,07,56,708 13.65 8.75 63,39,993
Mar 2010 10.50 8.15 59,16,856 10.45 8.20 2,94,734
(Source : BSE & NSE Websites)
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Annual Report 2009-201026
9.6 Registrar and Transfer Agent:The Company has entered into Memorandum of Understanding with M/s. Bigshare Services
Private Limited and they are acting as Registrar and Transfer Agent (RTA) to the company.
Investors / Shareholders may contact at the following address for any query:
Bigshare Services Pvt. Ltd.
E-23, Ansa Industrial Estate
Sakivihar Road
Saki Naka, Andheri (E)
Mumbai – 400 072
Tel: 91-22-28470652
Email: [email protected]
Our RTA has recently launched Gen-Next Investor Module i’Boss the most advanced tool to
interact with shareholders. Please log on to i’Boss (www.bigshareonline.com] and help them
serve you better.
Share Transfer System
Share transfers are registered and returned within a period of 21 days of receipt, if the
documents are in order in all respects. The company has no unclaimed shares in suspense
account. The Company obtains from a Company Secretary in Practice half-yearly certificate of
compliance with the share transfer formalities as required under Clause 47 (c) of the Listing
Agreement with Stock Exchanges and files a copy of the same with the Stock Exchanges where
the company’s shares are listed.
Dematerialization of shares
The dematerialization requests received were confirmed within 21 days from the date of receipt
of DRF and Share Certificates. As on 31st March, 2010,. 99.06% of the company’s shares were
in demat form and 0.94% of the shares were held in physical form. The company’s ISIN:
INE172101012
The Company has no outstanding GDRs / ADRs /Warrants or any convertible instruments except
to the allotment of . 28,237,500 equity convertible warrants on 8th December, 2009.
9.7 Plant Locations:
VITRIFIED TILES : Survey No. 650 & 651 P, Old Ghuntu Road,Morbi – 363 642.
ACP UNIT : Survey No. 651 P, Old Ghuntu Road,Morbi – 363 642.
WINDMILL : No. M-15 & M-38, Survey No. 84/P & 114/P, Village Khadoli,
Tal. Abdasa, Kutch
: No. T-1, Survey No. 283 Village Motti Sindhodi, Tal: Abdasa, Kutch
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Annual Report 2009-2010 27
9.8 Address for Correspondence:B/h. Romer Ceramics,
Old Ghuntu Road,
Morbi – 363642, Gujarat, India.
Tel: 91-2822-242987
Website: www.decocovering.com
Email: [email protected]
CIN: U26914GJ2000PLC037494
To,The Board of DirectorsDecolight Ceramics LimitedOld Ghuntu RoadMorbi – 363 642
Declaration on Compliance of Code of Conduct
I, Kantibhai M. Pethapara, Jt. Managing Director of Decolight Ceramics Limited, do hereby declare andconfirm that all the Board Members and Senior Management Personnel have affirmed to the Board ofDirectors the compliance of the Code of Conduct laid down by the Board.
Place : Morbi Kantibhai M. PethaparaDate : 30th August, 2010 Joint Managing Director
CEO / CFO CERTIFICATIONThe Jt. Managing Director and the CFO heading the finance function has certified to the Board that:(a) He has reviewed the financial statements and the cash flow statement for the year and that to the
best of his knowledge and belief:(i) these statements do not contain any materially untrue statement or omit any material fact or
contain statements that might be misleading;(ii) these statements together present a true and fair view of the company's affairs and are in
compliance with existing accounting standards, applicable laws and regulations.(b) There are, to the best of his knowledge and belief, no transactions entered into by the company
during the period which are fraudulent, illegal or violative of the company's code of conduct.(c) He accepts the responsibility for establishing and maintaining internal controls and he has evaluated
the effectiveness of the internal control systems of the company and he has disclosed to the auditorsand the Audit Committee, deficiencies in the design or operation of internal controls, if any, ofwhich he is aware and the steps taken or propose to take to rectify the deficiencies.
(d) He has indicated to the auditors and the Audit Committee- the significant changes in the internal control during the year- instances of significant fraud of which he has become aware and the involvement therein, if
any, of the management or an employee having a significant role in the company's internalcontrol system.
Kantibhai M. PethaparaJoint Managing Director
Place : MorbiDate : 30th August, 2010
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Annual Report 2009-201028
Status of non-mandatory requirement
1 During the period under review, there is no audit qualification in the financial statement. Thecompany continues to adopt best practices to ensure unqualified financial statements.
2 During the year under review, in-house training to Board Members has been given in the businessmodel of the company and the risk profile of the business parameters of the company.
3 The company established a Whistle-Blower Policy and placed the same in the Website of the com-pany. The Company affirms that during the year under review the company has not denied anyemployee access to Audit Committee. The existence of the whistle-Blower Policy has been appro-priately communicated throughout the organization, plant and manufacturing facilities.
4 The company provides all necessary infrastructure and assistance to the independent directors toenable them to discharge their responsibilities effectively.
5 The company did not send any half-yearly declaration of financial performance summary of thecompany to its shareholders.
6 The company is yet to establish the mechanism for evaluating non-executive Board Members.
MANAGEMENT RESPONSIBILITY STATEMENTThe financial statements are in full conformity with the requirements of the Companies Act, 1956 andGenerally Accepted Accounting Principles (GAAP) in India. The Management of Decolight Ceramics Ltd.accepts responsibility for the integrity and objectivity of these financial statements, as well as, for esti-mates and judgements relating to matters not concluded by the year-end. The management believesthat the financial statements reflect fairly the form and substance of transactions and reasonably presentsthe company's financial condition, and results of operations. To ensure this, the company has installed asystem of internal controls, which is reviewed, evaluated and updated on an ongoing basis. Our internalauditors have conducted periodical audits to provide reasonable assurance that the company's estab-lished policies and procedures have been followed. However, there are inherent limitations that shouldbe recognized in weighing the assurances provided by any system of internal controls.
These financial statements have been audited by SVK & Associates, the statutory auditors of the com-pany.
The Audit Committee of the Company meets periodically with the Chief Financial Officer, the ChiefAccountant, Internal Auditors and Statutory Auditors to review the manner in which they are performingtheir responsibilities and to discuss auditing, internal controls and financial reporting issues. They ensurecomplete independence, the statutory auditors and internal auditors have full and free access to mem-bers of the Audit Committee to discuss any matter of substance.
The Audit Committee for the financial year 2009-10 consisted of -
Mr. Rajendra G. Dhamasana -- Chairman*Mr. Gaurang Thoriya -- Member*Mr. Vasant Avachar Kaila -- Chairman w.e.f. 01.01.2010Mr Vijay Maganlal Vidja -- MemberMr Ashvin H Bopaliya -- Member w.e.f. 01.01.2010*ceased to be chairman / member with effect from 1st January, 2010*ceased to be member with effect from 15th October, 2009
Girishbhai M Pethapara Kantibhai M PethaparaChairman & Managing Director Joint Managing Director/CEO & CFO
Place : MorbiDate : 30th August, 2010
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Annual Report 2009-2010 29
TO
THE MEMBERS OF
DECOLIGHT CERAMICS LIMITED
We have examined the compliance of conditions of Corporate Governance by Decolight Ceramics Lim-
ited, for the year ended 31 March, 2010, as stipulated in Clause 49 of the Listing Agreement of the said
Company entered with the stock exchanges.
The compliance of conditions of Corporate Governance is the responsibility of the management. Our
examination was limited to procedures and implementation thereof, adopted by the Company for ensur-
ing the compliance of the conditions of Corporate Governance. It is neither an audit nor an expression of
opinion on the financial statements of the Company.
In our opinion and to the best of our information and according to the explanations given to us and based
on the representations made by the Directors and the Management, we certify that the Company has
complied with the conditions of Corporate Governance as stipulated in the Listing Agreement entered
with the stock exchanges, to the extent of applicable.
We state that such compliance is neither an assurance as to the future viability of the Company nor the
efficiency or effectiveness with which the Management has conducted the affairs of the Company.
For, HS Mehta & Associates
Company Secretaries
Sd/-
Hitesh S Mehta
C.P. No.: 2471
Place : MorbiDate : 30th August, 2010
Practicing Company Secretary’s Certificateon Corporate Governance
D E C O L I G H T C E R A M I C S L I M I T E D
An
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Re
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00
9-2
01
030
AUDIT REPORT
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TO THE MEMBERS OF ‘DECOLIGHT CERAMICS LIMITED’
1. We have audited the attached Balance Sheet of DECOLIGHT CERAMICS LIMITED, as at March 31,2010, and also the Profit and Loss Account and the Cash Flow Statement for the year ended on thatdate annexed thereto. These financial statements are the responsibility of the Company’s management.Our responsibility is to express an opinion on these financial statements based on our audit.
2. We conducted our audit in accordance with auditing standards generally accepted in India. Thosestandards require that we plan and perform the audit to obtain reasonable assurance about whetherthe financial statements are free of material misstatement. An audit includes examining, on a testbasis, evidence supporting the amounts and disclosure in the financial statements. An audit alsoincludes assessing the accounting principles used and significant estimates made by management, aswell as evaluating the overall financial statement presentation. We believe that our audit provides areasonable basis for our opinion.
3. As required by the Companies (Auditor’s Report) Order, 2003 and the Companies (Auditor’s Report)(Amendment) Order, 2004 issued by the Central Government of India in terms of sub-section (4A) ofSection 227 of the Companies Act, 1956 and on the basis of such checks and according to theinformation and explanations given to us, we enclose in the Annexure, a statement on the mattersspecified in paragraph 4 and 5 of the said Order.
4. Further to our comments in the Annexure referred to above, we report that:
i. We have obtained all the information and explanations, which to the best of our knowledgeand belief were necessary for the purposes of our audit;
ii. In our opinion, proper books of account as required by law have been kept by the Company, sofar as it appears from our examination of those books;
iii. The Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this reportare in agreement with the books of account;
iv. In our opinion, the Balance Sheet, Profit & Loss Account and Cash Flow Statement dealt with bythis report comply with the accounting standards referred to in sub-section (3C) of Section 211of the Companies Act, 1956, to the extent applicable;
v. On the basis of written representations received from the directors, as on March 31, 2010, andtaken on record by the Board of Directors, we report that none of the directors is disqualified ason 31st March, 2010 from being appointed as a director in terms of clause (g) of sub-section (1)of Section 274 of the Companies Act, 1956;
vi. In our opinion and to the best of our information and according to the explanations given to us,the said accounts read together with and subject to the notes thereon, give the informationrequired by the Companies Act, 1956, in the manner so required and give a true and fair viewin conformity with the accounting principles generally accepted in India;
a) In the case of the Balance Sheet, of the state of affairs of the Company as at 31st March,2010;
b) In the case of the Profit and Loss Account, of the loss of the Company for the year endedon that date; and
c) In the case of the Cash Flow Statement, of the cash flows of the Company for the yearended on that date.
For SVK & ASSOCIATESChartered Accountants
Shilpang V. KariaPartnerM. No. – 102114Firm No. - 118564W
Place : MorbiDate :12th August, 2010
Auditors’ Report
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Annual Report 2009-201032
Annexure To The Auditor’s Report(Referred to in paragraph 3 of our Report of even date on the Statement of Accounts of DECOLIGHT
CERAMICS LIMITED, for the year ended on 31st March, 2010)
i. FIXED ASSETS:
a. In our opinion, the company has maintained proper records showing full particulars including
quantitative details and situation of fixed assets on the basis of available information.
b. As explained to us, the fixed assets have been physically verified by the management during
the year in a phased periodical manner, which in our opinion is reasonable, having regard to
size of the company and nature of its assets. No material discrepancies with respect to book
records were noticed on such verification.
c. In our opinion, the company has not disposed of substantial part of fixed assets during the year
and the going concern status of the company is not affected.
ii. INVENTORIES:
a. As explained to us, physical verification of inventory has been conducted by the management
at reasonable intervals. In our opinion, the frequency of verification is reasonable in relation to
its size and nature of business.
b. In our opinion and according to the information and explanations given to us, the procedures
of physical verification of inventories followed by the management are reasonable and ad-
equate in relation its size and nature of business.
c. On the basis of our examination of the records of inventory, we are of the opinion that the
company is maintaining proper records of inventory in relation to its size and nature of busi-
ness. As explained to us, there were no material discrepancies noticed on physical verification
of inventory as compared to the book records.
iii. LOANS:
a. As explained to us, the company has not granted any loans, secured or unsecured to compa-
nies, firms or other parties covered in the register maintained under Section 301 of the Com-
panies Act, 1956, during the year under review. Accordingly clauses 4(iii) (a), (b), (c) and (d)
are not applicable.
b. As explained to us, the company has taken unsecured loan from three parties being directors
of the company covered in the register maintained under section 301 of the Companies Act,
1956. The maximum amount involved during the year from all such parties was Rs. 31.30 lacs,
however year end balance of loans taken from such parties is Nil.
c. According to information and explanation given to us and in our opinion the rate of interest
and other terms and conditions, wherever stipulated were not prima facie prejudicial to the
interest of the company.
d. According to the information and explanations given to us said loans were repayable on de-
mand and the repayment was within dates demanded.
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iv. INTERNAL CONTROL
In our opinion and according to the information and explanations given to us, there is an adequate
internal control system commensurate with the size of the company and nature of its business for
the purchase of inventory, fixed assets and for the sale of goods and services. During the course of
our audit, no major weakness has been noticed in the internal control system in these areas.
v. TRANSACTIONS IN PURSUANCE OF SECTION 301:
a. According to information and explanations given to us, we are of the opinion that the particu-
lars of contracts or arrangements referred to in section 301 of the Act that need to be entered
into the register maintained under Section 301 have been so entered.
b. In our opinion and according to the information and explanations given to us, transactions
made in pursuance of such contracts or arrangements have been made at prices which are
reasonable having regard to the prevailing market prices available at the relevant time.
vi. DEPOSITS:
As explained to us, the company has not accepted any deposits from the public within meaning of
Section 58A and 58AA of the Companies Act, 1956, during the year under review.
vii. INTERNAL AUDIT:
In our opinion and according to information and explanations given to us, the internal audit system
of the company is commensurate with size and nature of its business.
viii. COST RECORDS:
To the best of our knowledge and as explained to us, the central government has not prescribed the
maintenance of cost records for the business of the company under section 209(1)(d) of the Compa-
nies Act, 1956, except for wind power generation business of the company. We have broadly
reviewed the accounts and records of the company in this connection and are of the opinion, that
prima facie, the prescribed accounts and records have been made and maintained. We have not,
however, made a detailed examination of the records with a view to determining whether they are
accurate or complete.
ix. STATUTORY DUES:
a. As per information and explanation available to us, undisputed statutory dues including provi-
dent fund, investor education and protection fund, employee's state insurance, income-tax,
sales-tax, wealth tax, service tax, custom duty, excise duty, cess and other statutory dues have
been generally regularly deposited with the appropriate authorities, applicable to it though
there had been certain delays during the year under review. Further according to information
explanation given to us, no such undisputed statutory dues applicable to the company were
outstanding as at 31st March, 2010 for a period of more than 6 months from the date they
become payable, except value added tax of Rs. 2.03 lacs.
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b. According to the information and explanation available to us, details of dues of Excise Duty,
Service Tax, Cess which have not been deposited on account of any dispute with appellate
authority, are given below:
Name of Nature of dues Amount Period to Forum where
the statue under dispute which amount dispute is
Rs. In lacs relates pending
The Central Excise duty including interest 4.65 2004-05 Tribunal
Excise Act 1944 and penalty as applicable
However the company has paid under protest Rs. 2.60 lacs for the above. The excise / service
tax department has issued certain show cause notices amounting to tax liability of Rs. 1199.60
lacs, which are pending at adjudication level and amount paid under protest for the same
amounting to Rs. 408.79 lacs.
x. CASH LOSSES AND ACCUMULATED LOSSES:
The company has no accumulated losses at the end of the year under review and it has not incurred
any cash losses in the year under review and the immediately preceding financial year.
xi. DUES TO FINANCIAL INSTITUTION, BANKS OR DEBENTURE HOLDER:
Based on our audit procedures and as per information and explanation given to us by the manage-
ment of the company, we are of the opinion that company has defaulted in repayment of dues to
banks and financial institution during the year under review. The details default at year end after
taking into the consideration restructuring / rescheduling of the loans granted by the bank are as
follows:
Period of Default Amount (Rs. In lacs)
Less than 30 days 123.82
30 to 90 days 181.01
However as per further information and explanations received, overdue as of balance sheet date
has been paid after balance sheet date.
xii. LOANS & ADVANCES ON PLEDGE OF SHARES DEBENTURES & OTHER SECURITIES:
In our opinion and according to information and explanation given to us, no loans and advances
have been granted by the company on the basis of security by way of pledge of shares, debentures
and other securities.
xiii. CHIT FUND/ NIDHI / MUTUAL BENEFIT FUND / SOCIETY:
In our opinion, the company is not a chit fund or a nidhi / mutual benefit fund / society. Therefore,
clauses 4(xiii) of the Companies (Auditor's Report) Order, 2003 (as amended) is not applicable to the
company.
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xiv. TRADING IN SHARES, SECURITIES, DEBENTURES & OTHER INVESTMENTS:
The company is not dealing or trading in shares, securities, debentures and other investments.
xv. GUARANTEE FOR LOANS TAKEN BY OTHERS:
According to the information and explanations given to us, the company has not given any guaran-
tee for loans taken by others from any bank or financial institutions. Accordingly clauses 4(xv) is not
applicable.
xvi. TERM LOANS:
In our opinion and according to the information and explanations given to us, on an overall basis,
the term loans have been applied for the purpose for which they were obtained.
xvii. SHORT TERM FUNDS USED FOR LONG TERM INVESTMENTS:
According to the information and explanations given to us, and on overall examination of the year
end balance sheet of the company, we are of the opinion that prima facie, no funds raised on short-
term basis have been used for long-term investments.
xviii.PREFERENTIAL ALLOMENT OF SHARES:
According to the information and explanations given to us, during the year under review, the com-
pany has not made any preferential allotment of shares to parties or companies covered in the
register maintained under Section 301 of the Companies Act, 1956.
xix. DEBENTURES:
The company has not issued any debentures during the year under review.
xx. PUBLIC ISSUE:
We have verified the end use of money raised during the year under review by preferential issue of
equity convertible warrants as disclosed in the notes to the financial statements.
xxi. FRAUD:
Based upon the audit procedures performed for the purpose of reporting the true and fair view of the
financial statements and as per the information and explanation given by the management, we
report that no fraud on or by the company has been noticed or reported during the course of our
audit.
For, SVK & ASSOCIATESChartered Accountants
Shilpang V. KariaPartnerM. No. – 102114Firm No. - 118564WPlace : Morbi
Date :12th August, 2010
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Balance Sheet As At 31st March, 2010
As per our report of even date For and on behalf of the BoardFor SVK & ASSOCIATES For DECOLIGHT CERAMICS LTD.Chartered Accountants
Shilpang V. Karia Girishbhai M. Pethapara Kantibhai M. PethaparaPartner Managing Director Joint Managing DirectorMembership No.: 102114Firm No.: 118564WPlace : Morbi Ramachandran Pillai Place : MorbiDate : 12th August, 2010 Company Secretary Date : 12th August, 2010
As at As atPARTICULARS SCHEDULE 31-March-10 31-March-09
Rs. Rs.
SOURCES OF FUNDS :1. Shareholders’ Funds
(a) Share Capital A 183,354,440 183,354,440(b) Equity Convertible Warrants A1 70,593,750 -(c) Reserves & Surplus B 570,459,334 576,980,764
824,407,524 760,335,204
2. Loan Funds(a) Secured Loans C 524,803,791 528,439,763(b) Unsecured Loans D 1,094,690 2,885,448
525,898,481 531,325,211
3. Deferred Tax Liability (net) 57,219,894 71,574,952
TOTAL 1,407,525,900 1,363,235,367
APPLICATION OF FUNDS :
1. Fixed Assets E(a) Gross Block 939,019,292 883,948,151(b) Less :- Depreciation 162,851,299 111,229,680
(c) Net Block 776,167,992 772,718,471
(d) Capital Work-in-Progress - 21,292,796
776,167,992 794,011,267
2. Investments F 59,910,905 -3. Current Assets , Loans and Advances G
(a) Inventories 311,155,882 342,030,362(b) Sundry Debtors 304,913,780 244,895,224(c) Cash and Bank Balances 10,541,613 17,107,051(d) Loans and Advances 111,045,290 110,341,485
737,656,565 714,374,122
Less : Current Liabilities and Provisions H(a) Current Liabilities 148,926,321 139,340,138(b) Provisions 34,603,245 25,241,574
183,529,565 164,581,712
Net Current Assets 554,127,000 549,792,410
4. Miscellaneous Expenditure I 17,320,004 19,431,690
TOTAL 1,407,525,900 1,363,235,367
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Annual Report 2009-2010 37
Profit And Loss Account
For The Year Ended 31st March, 2010
For the Year For the YearPARTICULARS SCHEDULE 31-March-10 31-March-09
Rs. Rs.
INCOME :Sales and Other Income from Operations J 924,295,441 772,798,448Less: Excise Duty Recovered on Sales 49,370,325 45,583,328
874,925,116 727,215,120Other Income K 42,646,765 9,289,814Increase / (Decrease) in Stocks L (3,958,598) 116,762,224
TOTAL 913,613,283 853,267,158
EXPENDITURE :Material Costs M 293,246,649 226,799,577Manufacturing & Operating Costs N 416,046,723 376,249,232Employment Costs O 50,710,705 47,034,205Sales & Distribution Expenses P 18,880,789 29,992,668Administrative & General Expenses Q 25,779,786 25,413,295Interest & Financial Charges R 77,274,689 64,944,290Depreciation E 52,185,502 48,269,681Miscellaneous Expenditure Written Off I 3,563,510 3,804,759
937,688,353 822,507,707
Profit Before Tax & Before Exceptional Items (24,075,070) 30,759,452
Less: Exceptional Items (Refer note 9) 3,843,992 9,648,001
Profit Before Tax & After Exceptional Items (27,919,062) 21,111,451
Provision for Tax : - Current Tax - 2,349,184 - Deferred Tax (14,355,058) (10,438,876) - Fringe Benefit Tax - 377,255 - Earlier Year Tax - 599,173
Tax For the Year (14,355,058) (7,113,264)
Profit After Tax (13,564,004) 28,224,714Less: Prior Year Items 16,800 1,774,144Balance Brought Forward From Last Year 211,563,660 185,113,090
Amount Available For Appropriation 197,982,856 211,563,660
APPROPRIATIONS:-Proposed Dividend on Equity Shares - -Tax on Proposed Dividend - -
- -
Balance carried to Balance Sheet 197,982,856 211,563,660
Earning Per Share Before Exceptional Items (Basic Diluted) -0.53 2.01Earning Per Share After Exceptional Items (Basic & Diluted) -0.74 1.54(Refer Note 13)Significant Accounting Policies SNotes to Accounts T
As per our report of even date For and on behalf of the BoardFor SVK & ASSOCIATES For DECOLIGHT CERAMICS LTD.Chartered Accountants
Shilpang V. Karia Girishbhai M. Pethapara Kantibhai M. PethaparaPartner Managing Director Joint Managing DirectorMembership No.: 102114Firm No.: 118564WPlace : Morbi Ramachandran Pillai Place : MorbiDate : 12th August, 2010 Company Secretary Date : 12th August, 2010
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Annual Report 2009-201038
Cash Flow Statement
For The Year Ended 31st March, 2010
As per our report of even date For and on behalf of the BoardFor SVK & ASSOCIATES For DECOLIGHT CERAMICS LTD.Chartered Accountants
Shilpang V. Karia Girishbhai M. Pethapara Kantibhai M. PethaparaPartner Managing Director Joint Managing DirectorMembership No.: 102114Firm No.: 118564WPlace : Morbi Ramachandran Pillai Place : MorbiDate : 12th August, 2010 Company Secretary Date : 12th August, 2010
PARTICULARS For the Year For the Year 31-March-10 31-March-09
Rs. Rs.
A Cash Flow from Operating ActivityProfit before tax and before exceptional items (24,075,070) 30,759,452Add: Non Cash and Operating ExpensesDepreciation 52,185,502 48,269,681Interest & Financial Charges 77,274,689 64,944,290Preliminary Expenses Written Off 3,563,510 3,804,759
Operating profit before working capital changes 108,948,631 147,778,182Adjustment for:(Increase) / Decrease in Inventory 30,874,479 (139,822,561)(Increase) / Decrease in Debtors (60,018,556) 9,702,037(Increase) / Decrease in Loans and Advances 1,315,846 (17,972,256)Increase / (Decrease) in Current Liabilities and Provisions 19,432,827 (869,677)(Increase) / Decrease in Deferred Revenue Expenditure (1,451,823) (8,795,477)(to the extent not written off)
Cash Generated from Operation 99,101,405 (9,979,752)Taxes paid (2,504,625) (9,014,865)
Net Cash Flow from Operating Activity beforeExceptional Items 96,596,780 (18,994,617)Less: Exceptional and Prior Year Revenue Expenses in CashExceptional Items 3,843,992 9,648,001Prior Year Items 16,800 1,774,144
Net Cash Flow from Operating Activity afterExceptional Items 92,735,988 (30,416,762)
B Cash Flow from Investing Activity(Increase) / Decrease in Fixed Assets (net) (34,342,227) (87,421,898)(Increase) / Decrease in Investments & Accrued Interest Thereon (59,910,905) 37,054,067
Net Cash Flow from Investing Activities (94,253,132) (50,367,831)
C Cash Flow from Financing ActivityProceeds from Issue of Equity Convertible Warrants 77,653,125 -Increase / (Decrease) in Secured Loans (3,635,972) 152,886,209Increase / (Decrease) in Unsecured Loans (1,790,758) (7,133,561)Interest Expenses (77,274,689) (64,944,290)
Net Cash Flow from Financing Activities (5,048,294) 80,808,358
Net Increase / (Decrease) in Cash and Cash Equivalents (6,565,439) 23,765Opening Balance of Cash and Cash Equivalents 17,107,051 17,083,286
Closing Balance of Cash and Cash Equivalents 10,541,613 17,107,051
Notes :1. The above Cash Flow Statement has been prepared under the "Indirect Method" as set out in the
Accounting Standard - 3 on "Cash Flow Statement" issued by ICAI.2. Figures of Cash & Cash Equivalents have been taken from Schedule G (c).
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Annual Report 2009-2010 39
Schedules Forming Part Of
Balance Sheet As At 31st March, 2010
As at As atPARTICULARS 31-March-10 31-March-09
Rs. Rs.
SCHEDULE- A : SHARE CAPITAL
1 AUTHORISED :100,000,000 Equity Shares of Rs.10/- each 1,000,000,000 250,000,000(25,000,000)
Total 1,000,000,000 250,000,000
2 ISSUED, SUBSCRIBED & PAID UP :EQUITY SHARE CAPITAL18,335,444 Equity Shares of Rs.10/- each fully paid 183,354,440 183,354,440(18,335,444)
TOTAL A 183,354,440 183,354,440
SCHEDULE- A1: EQUITY CONVERTIBLE WARRANTS28,237,500 (Nil) Equity Convertible Warrants ofRs. 10/- each partly paid (Refer Note 2) 70,593,750 -
TOTAL A1 70,593,750 -
SCHEDULE- B : RESERVES & SURPLUS
Equity Share premium 365,417,104 365,417,104Equity Convertible Warrants Premium 7,059,375 -
372,476,479 365,417,104
Profit & Loss Account 197,982,856 211,563,660
TOTAL B 570,459,335 576,980,764
SCHEDULE - C : SECURED LOANS *
(Refer note 3)From Banks:
Term Loans 89,028,784 87,923,502Corporate Loans 118,821,041 127,746,899Working Capital Loans 273,632,290 265,254,313Vehicle Loans 1,401,496 1,521,593
From Financial Institutions:Term Loan 41,255,000 44,600,000Vehicle Loans 665,179 1,393,456
* Secured Loans excludes interest acrrued but not due
TOTAL C 524,803,791 528,439,763
SCHEDULE - D : UNSECURED LOANS
Long Term:From Banks 1,094,690 2,885,448
TOTAL D 1,094,690 2,885,448
D E C O L I G H T C E R A M I C S L I M I T E D
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Schedules Forming Part Of Balance Sheet As At 31st March, 2010
SCHEDULE - E : FIXED ASSETS
GROSS BLOCK DEPRECIATION / AMORTIZATION BLOCK NET BLOCK
As on Additions Deductions As on As on Depreciation Deductions As on As on As onParticulars 1-April-09 during during 31-March-10 1-April-09 for 31-March-10 31-March-10 31-March-09
the year the year the year
Land 1,390,920 – – 1,390,920 – – – – 1,390,920 1,390,920
Factory Buildings 134,398,787 24,988,406 – 159,387,193 11,224,923 5,068,919 – 16,293,842 143,093,351 123,173,864
Plant and Manchinery – –
Coal Gas Plant 41,634,068 – – 41,634,068 7,825,627 2,198,279 – 10,023,906 31,610,162 33,808,441
Kilan 46,554,968 – – 46,554,968 7,086,680 2,458,102 – 9,544,782 37,010,186 39,468,288
Drayer 20,274,770 – – 20,274,770 2,805,910 1,070,508 – 3,876,418 16,398,352 17,468,860
Press 23,293,228 – – 23,293,228 5,843,645 1,229,882 – 7,073,528 16,219,701 17,449,583
Other Imported Machineries 198,004,908 – – 198,004,908 32,493,600 14,161,158 – 46,654,758 151,350,150 165,511,308
Indigenous Machineries 151,451,221 30,274,372 – 181,725,593 20,918,684 11,035,595 – 31,954,279 149,771,314 130,532,536
Electric Installation 11,670,998 – – 11,670,998 1,827,049 865,988 – 2,693,037 8,977,961 9,843,949
Electric Fittings 6,294,542 – – 6,294,542 1,297,070 467,055 – 1,764,125 4,530,417 4,997,472
Laboratory Instruments 738,409 – – 738,409 120,055 35,074 – 155,129 583,280 618,354
Other Equipments 952,910 – – 952,910 14,529 70,706 – 85,235 867,675 938,381
Computer 1,279,062 188,770 25,000 1,442,832 332,500 227,234 5,074 554,659 888,173 946,562
Mobile Instruments 320,420 37,675 – 358,095 45,113 16,855 – 61,969 296,126 275,307
Furniture and Fixtures – –
Office Furniture 1,277,944 93,895 – 1,371,839 50,985 84,278 – 135,264 1,236,575 1,226,959
Office Appliances 839,226 59,505 – 898,731 71,474 41,086 – 112,560 786,171 767,752
Vehicles – –
Motor Car 6,786,138 609,687 1,156,170 6,239,655 1,021,740 640,176 558,809 1,103,107 5,136,548 5,764,398
Staff Bus 476,800 – – 476,800 215,311 45,296 – 260,607 216,193 261,489
Wind Mill Plant & Machinery 233,524,233 – – 233,524,233 17,833,587 12,330,080 – 30,163,666 203,360,567 215,690,646
Wind Mill Leasehold Land 2,784,600 – – 2,784,600 201,200 139,230 – 340,430 2,444,170 2,583,400
883,948,152 56,252,310 1,181,170 939,019,292 111,229,680 52,185,502 563,883 162,851,299 776,167,992 772,718,472
Capital Work In Progress
Factory Building 21,273,171 – 21,273,171 – – – – – – 21,273,171
Furniture & Fixtures 19,625 – 19,625 – – – – – – 19,625
21,292,796 – 21,292,796 – – – – – – 21,292,796
GRAND TOTAL 905,240,948 56,252,310 22,473,966 939,019,292 111,229,680 52,185,502 563,883 162,851,299 776,167,992 794,011,268
PREVIOUS YEAR TOTAL 817,819,049 153,990,120 66,568,220 905,240,948 62,959,999 48,269,681 – 111,229,680 794,011,268 754,859,050
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Annual Report 2009-2010 41
Schedules Forming Part Of
Balance Sheet As At 31st March, 2010
As at As atPARTICULARS 31-March-10 31-March-09
Rs. Rs.
SCHEDULE- F : INVESTMENTS
Unutilized Fund of Equity Convertible Warrants
Inter Corporate Deposits 57,000,000 -
Bank & Other Deposits - -
Interest Accrued and Due 2,910,905 -
TOTAL F 59,910,905 -
SCHEDULE- G : CURRENT ASSETS, LOANS AND ADVANCES
(a) INVENTORIES :
(As taken ,valued and certified by the management)
Raw Materials 26,083,277 41,897,662
Stores & Spares, Polishing Materials & Packing Materials 67,269,353 53,388,919
Semi Finished Goods 107,727,906 129,779,164
Finished Goods * 94,313,348 77,297,275
Fuel Items 379,650 12,095,347
Merchanting Goods 15,382,349 27,571,995
Total (a) 311,155,882 342,030,362
* Includes Goods in Transist Rs. Nil (Rs. 32,43,382)
(b) SUNDRY DEBTORS :
(Unsecured and considered good as certified by the management)
Others 186,712,325 107,243,649
Over six months 118,201,454 137,651,575
Total (b) 304,913,780 244,895,224
(c) CASH AND BANK BALANCES :
Cash on hand & Equivalants 2,930,628 3,711,751
Balances with Scheduled Banks
- In Current Accounts 268,326 4,847,121
- In Fixed deposit 7,342,659 8,548,179
Total (c) 10,541,613 17,107,051
(d) LOANS AND ADVANCES :
(Unsecured and considered good as certified by the management)
Advances recoverable in cash or kind or for value to be recovered 71,207,355 73,664,027
Deposits with government 9,541,791 10,798,626
Advance payment against taxes 30,296,144 25,878,832
Total (d) 111,045,290 110,341,485
TOTAL G (a+b+c+d) 737,656,565 714,374,122
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Annual Report 2009-201042
Schedules Forming Part Of
Balance Sheet As At 31st March, 2010
As at As atPARTICULARS 31-March-10 31-March-09
Rs. Rs.
SCHEDULE- H : CURRENT LIABILITIES & PROVISIONS
(a) Current Liabilities :
Sundry Creditors
- Others 118,683,575 77,313,248
- Micro, Small & Medium Enterprises (Refer note 19 ) 1,563,931 4,872,913
Dealers Deposits 10,938,215 24,100,001
Advances from Customers 3,969,993 17,464,546
Duties & Taxes Payable 7,967,796 9,630,888
Interest acrrued but not due on Secured Loans 5,802,810 5,958,542
Total (a) 148,926,321 139,340,138
(b) Provisions :
For Unpaid expenses 11,391,564 5,141,828
For Excise duty 4,673,496 1,076,588
For Income Tax 18,538,183 18,538,183
For Fringe Benefit Tax - 484,974
Total (b) 34,603,244 25,241,574
TOTAL H (a+b) 183,529,564 164,581,712
SCHEDULE - I : MISCELLANEOUS EXPENDITURE
(To the extent not adjusted or written off)
(a) Preliminary Expenses 360,000 961,249
Less : - Written off against profit and loss account 360,000 601,249
Total (a) - 360,000
(b) Share Issue Expenses 10,276,214 13,479,724
Less : - Written off against profit and loss account 3,203,510 3,203,510
Total (b) 7,072,704 10,276,214
(c) Deferred Revenue Expenditure 8,795,477 -
Add : - Incurred During the Year 4,563,365 10,994,346
Less : - Written off During the Year 3,111,542 2,198,869
Total (c) 10,247,300 8,795,477
TOTAL I (a+b+c) 17,320,004 19,431,690
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Annual Report 2009-2010 43
Schedules Forming Part of Profit And Loss Account
For The Year Ended 31st March, 2010
For the Year For the YearPARTICULARS 31-March-10 31-March-09
Rs. Rs.
SCHEDULE - J : SALES AND OTHER INCOME FROM OPERATIONSSale of Manufactured Goods 766,185,483 685,720,649Sale of Merchanting & Other Goods 72,990,190 46,598,631Work Contract Income [TDS Rs. 6,21,111 (Nil)] 30,151,000 -Wind Power Generation Inome 54,968,769 40,479,168
TOTAL J 924,295,441 772,798,448
SCHEDULE - K : OTHER INCOMEInterest on Investments [TDS Rs. 1,00,600 (Rs. 8,06,645)] 3,390,986 4,285,972Interest Income [TDS Rs. 1,89,673 (Rs. 3,60,564)] 1,076,038 1,285,533Rate Difference, Discount & Credit Balances written back 32,454,378 1,593,548Other Miscellaneous Income 5,725,363 2,124,761
TOTAL K 42,646,765 9,289,814
SCHEDULE - L : INCREASE / (DECREASE) IN STOCKS(a) Stock-In-Trade (at close)
Finished Goods 94,313,348 77,297,275Stock-in-process 107,727,906 129,779,164
Total (a) 202,041,254 207,076,439
(b) Stock-In-Trade (at commencement)Finished Goods 77,297,276 41,315,640Excise Duty (1,076,588) (4,137,552)Stock-in-process 129,779,164 53,136,127
Total (b) 205,999,852 90,314,215
TOTAL L (a-b) (3,958,598) 116,762,224
SCHEDULE - M : MATERIAL COSTS(a) Raw Material :-
Opening Stock 41,897,662 45,081,299Less: Transfer to Consumables - 131,595Add: Purchases (net) 217,038,941 197,844,097Less: Closing Stock 26,083,277 41,897,662
Raw Material Consumed Total (a) 232,853,326 200,896,139
(b) Merchanting Goods :-Opening Stock 27,571,996 1,238,155Less: Transfer to Consumables - 1,099,780Add: Purchases 48,203,675 53,337,057Less: Closing Stock 15,382,349 27,571,995
Cost of Goods Sold Total (b) 60,393,323 25,903,437
TOTAL M (a+b) 293,246,649 226,799,577
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Annual Report 2009-201044
Schedules Forming Part Of Profit And Loss Account
For The Year Ended 31st March, 2010
For the Year For the YearPARTICULARS 31-March-10 31-March-09
Rs. Rs.
SCHEDULE - N : MANUFACTURING & OPERATING COSTS
Consumption of Stores & Spares 45,133,916 35,036,030Consumption of Packing Materials 22,142,810 27,930,309Consumption of Electirc, Power and Fuel 276,485,024 264,345,920Machinery Repairs & Maintenance 7,672,946 5,784,955Building Repairs & Maintenance 697,630 153,016Freight & Unloading Expenses 37,158,594 36,162,648Work Contract Expenses 6,206,153 -Rent - Factory 244,000 360,000Other Manufacturing & Operating Expenses 20,305,650 6,476,354
TOTAL N 416,046,723 376,249,232
SCHEDULE - O : EMPLOYMENT COSTS
Salary, Wages and Bonus (including directors remuneration) 49,752,132 46,178,986Contribution to Provident Fund & Gratuity Fund Provision 958,573 855,219
TOTAL O 50,710,705 47,034,205
SCHEDULE - P : SALES & DISTRIBUTION EXPENSES
Advertisement & Sales Promotion Expenses 6,549,479 4,303,069Discount and Commission 5,706,936 20,525,620Transportation & Loading Expenses 4,996,098 5,132,280Bad Debts Written off 972,503 11,688Taxes 655,774 20,011
TOTAL P 18,880,789 29,992,668
SCHEDULE -Q : GENERAL & ADMINISTRATION EXPENSES
Rent 8,136,491 5,761,637Rates & Taxes 62,851 49,118Conveyance, Tour and Travelling Expenses 4,478,301 6,566,137Legal and Professional Expenses 3,877,647 2,108,466Insurance 1,248,420 1,216,311General Administration Expenses 7,865,828 9,600,646Other Miscellaneous Expenses 110,248 110,979
TOTAL Q 25,779,786 25,413,295
SCHEDULE -R : INTEREST & FINANCE CHARGES
Bank Loan and other Interest 74,686,962 57,622,703Other Financial Charges 2,587,727 7,321,587
TOTAL R 77,274,689 64,944,290
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Annual Report 2009-2010 45
SCHEDULE S : SIGNIFICANT ACCOUNTING POLICIES
(i) Basis of preparation
The financial statements have been prepared to comply with all material aspects of the mandatory
Accounting Standards issued by the Institute of Chartered Accountants of India ('ICAI') and the
relevant provisions of the Companies Act, 1956 (the 'Act'). The financial statements have been
prepared under the historical cost convention on accrual basis. The accounting policies have been
consistently applied by the Company unless otherwise stated.
(ii) Use of Estimates:
The presentation of financial statements in conformity with the generally accepted accounting principles
requires estimates and assumptions to be made that affect the reported amount of assets and
liabilities and disclosures relating to contingent liabilities as at the date of the financial statements
and the reported amount of revenues and expenses during the reporting year. Contingencies are
recorded when it is probable that a liability will be incurred, and the amount can be reasonably
estimated. Actual results could differ from those estimates. Differences between the actual results
and estimates are recognised in the year in which the results are known / materialised.
(iii) Revenue Recognition:
Revenue is recognized to the extent that it is probable that the economic benefits will flow to the
company and the revenue can be reliably measured.
Sales of Goods:
Sales are recognised when significant risks and rewards of ownership of goods have been passed on
to the buyer.
Work Contracts Income:
Work contracts income is recognised on completed contract method when the complete services
are rendered.
Power Generation Income:
Power generation income is recognised on the basis of electrical units generated and eligible for
captive consumption or captive consumed or sold as shown in the power generation reports issued
by the concerned authorities. Power generation income is booked as the per unit electricity rate,
being paid by the company / actually sold by the company.
Interest:
Revenue is recognised on a time proportion basis taking into account the amount outstanding and
the rate applicable.
Other Income:
Sales Schemes and Other Market incentives are recognized in the profit and loss account of the
period during which it accrues. Unspent liabilities & credit balances are recognized in the profit and
loss account of the period in which it is identified as not payable.
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Annual Report 2009-201046
(iv) Inventories:
Inventories of Raw Materials, Packing Materials, Goods-in-Process, Finished Goods, and Merchanting
Goods are stated at cost or net realisable value, whichever is lower. Stores and Spare Parts are
stated 'at or below cost'. Goods-in-transit are stated 'at cost'. Cost comprises all cost of purchase,
cost of conversion and other costs incurred in bringing the inventories to their present location and
condition. The excise duty in respect of closing inventory of finished goods is included as part of
finished goods. Cost formula used is 'Average cost'. Due allowance is estimated and made for
defective and obsolete items, wherever necessary, based on the past experience of the Company.
(v) Fixed Assets :
Gross fixed assets are stated at cost of acquisition including incidental expenses relating to acquisition
and installation. Fixed Assets are stated at cost net of modvat / cenvat / other credits and includes
amounts added on revaluation, less accumulated depreciation and impairment loss, if any. All pre-
operative costs, including specific financing cost till commencement of commercial production, net
charges on foreign exchange contracts and adjustment arising from foreign exchange rate variations
attributable to the fixed assets are capitalised. Long-term leasehold assets are capitalized under
fixed assets.
(vi) Depreciation / Amortization
Depreciation is provided on Straight Line Method at the rates and in the manners prescribed in
Schedules XIV to the Companies Act, 1956, on the basis of shifts / manners of utilization of the
assets. Depreciation on additions/ disposals during the year has been provided on pro-rata basis with
reference to the nos. of days utilized.
Long-term leasehold assets capitalized under fixed assets are amortized over the period of lease on
straight-line method.
(vii) Borrowing Cost
Borrowing costs that are attributable to the acquisition or construction of qualifying assets are
capitalised as part of the cost of such assets. A qualifying asset is one that necessarily takes substantial
period of time to get ready for intended use. All other borrowing costs are charged to revenue.
(viii) Foreign Currency Transactions
Transactions denominated in foreign currencies are recorded at the exchange rate prevailing on the
date of transaction.
Foreign currency current assets and current liabilities outstanding at the balance sheet date are
translated at the exchange rate prevailing on that date and the net gain or loss is recognized in the
profit and loss account.
Foreign currency translation differences relating to liabilities incurred for purchasing of fixed assets
from foreign countries are adjusted in the carrying cost of fixed asset for differences up to the year-
end in the year of acquisition, whereas differences arising thereafter to be recognized in the profit
and loss account. All other foreign currency gain or losses are recognized in the profit and loss
account.
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Annual Report 2009-2010 47
(ix) Investments
Pending the utilization of equity convertible warrants issued on preferential basis application money
received, fund raised for the purpose has been shown under this group, in compliance with Schedule
VI of the Companies Act, 1956. Interest accrued and due over such investments has been shown
separately under this group.
(x) Taxation
Tax expenses comprise current tax and deferred tax charge or credit. Current tax is determined in
accordance with the provisions of the Income-Tax Act, 1961.
Deferred tax assets and liability is recognized, on timing differences, being the differences between
taxable income and accounting income that originate in one period and are capable of reversal in
one or more subsequent periods. Deferred tax assets arising mainly on account of brought forward
losses, unabsorbed depreciation and minimum alternate tax under tax laws, are recognised, only if
there is a virtual certainty of its realisation, supported by convincing evidence. At each Balance
Sheet date, the carrying amount of deferred tax assets are reviewed to reassure realisation. The
deferred tax asset and deferred tax liability is calculated by applying tax rate and tax laws that have
been enacted or substantively enacted by the Balance Sheet date.
(xi) Operating Lease
Operating leases: Assets acquired as leases where a significant portion of risk and rewards of ownership
are retained by the lessor are classified as operating lease. Lease rentals being income or expense
are booked to the profit and loss account as incurred.
Initial direct cost in respect of the lease acquired are expensed out in the year in which such costs
are incurred.
(xii) Retirement Benefits and other employee benefits
Defined contribution to provident fund is charged to the profit and loss account on accrual basis.
Provision for gratuity liability is provided based on actuarial valuation made at the end of the financial
year.
Leave encashment expenditure is charged to profit and loss account at the time of leave encashed
and paid. Bonus expenditure is charged to profit and loss account on accrual basis.
(xiii) Provisions, contingent liabilities and contingent assets
A provision is recognised when the company has a present obligation as a result of past events and
it is probable that an outflow of resources will be required to settle the obligation, in respect of
which a reliable estimate can be made. Provisions are not discounted to their present value and are
determined based on best estimates required to settle the obligation at the balance sheet date.
These are reviewed at each balance sheet date and adjusted to reflect the current best estimates.
Contingent liabilities are disclosed by way of notes to the accounts.
Contingent assets are not recognized.
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Annual Report 2009-201048
(xiv) Preliminary & Pre-operative Expenditure
Preliminary Expenditure has been amortised over a period of five years.
Pre-operative Expenditure incurred for expansion project including specific financing cost till
commencement of commercial production, attributable to the fixed assets are capitalised.
(xv) Deferred Revenue Expenditure
Deferred Revenue Expenditure includes those advertisement expenditure, market survey expenditure
and sales promotion expenditure, which in the opinion of the management of the company has
beneficial utility for longer period. Such expenditure is amortized over period of five years on straight
line basis.
(xvi) Share Issue Expenses
Portion of share issue expenses being in nature of deferred revenue expenses incurred for raising the
money through initial public offer for the expansion projects are amortized to profit and loss account
over period of five years from the commencement of the relevant project. Additional share issue
expenses incurred at the time of initial public offer has been written off against the share premium
received in the initial public offer.
Expenses incurred towards proposed allotment of equity convertible warrants on preferential basis
and towards proposed issuance / offering of GDR/ADR/FCCB/QIP are shown as pre-paid expense
pending the issuance / offering of such shares / warrants.
As per our attached report of even date For and on behalf of the BoardFor SVK & ASSOCIATES For DECOLIGHT CERAMICS LTD.Chartered Accountants
Shilpang V. Karia Girishbhai M. Pethapara Kantibhai M. PethaparaPartner Managing Director Joint Managing DirectorMembership No.: 102114Firm No.: 118564WPlace : Morbi Ramachandran Pillai Place : MorbiDate : 12th August, 2010 Company Secretary Date : 12th August, 2010
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Annual Report 2009-2010 49
SCHEDULE T : NOTES ON ACCOUNTS
Nature of Operations :-
Decolight Ceramics Ltd. having its manufacturing facilities at Morbi, is engaged in Manufacturing of
vitrified tiles & alluminium composite panels, Trading of other ceramic tiles and commodities items,
Work contracts for ceramic and alluminium section works and Wind Power Genration.
1 Previous year’s figure have been reworked, regrouped, rearranged and reclassified wherever necessary.
Accordingly, amounts and other disclosures for the preceding year are included as an integral part of
the current year financial statements and are to be read in relation to the amounts and other disclosures
relating to the current year.
2 Equity Convertible Warrants : -
28,237,500 Equity Convertible Warrants alloted on preferential basis being convertible within 18
months from the date of allotment of warrant i.e. any time on or before June 7, 2011, exercisable at
the option of the warrant holders into one equity share per warrant at Rs.10.25 (including premium of
Re.0.25) per equity share of the nominal value of Rs.10 each. Application cum allotment money
received of Rs. 2.75 (including premium of Re.0.25) per equity convertible warrant.
3 Loan Funds :-
Term Loan & Corporate Loan From Banks
Amt O/s
Rs.207,849,825/- Secured by Equitable Mortgage of factory land & building, hyphothication of
plant & machineries, hypothecation of stock & book-debts, Equitable Mortgage & Hypothecation
of collaterals from associate concern & relatives of directors and guarantee of directors, their
relatives and associates.
Working Capital Loan From Banks
Amt O/s
Rs.273,632,290/- Secured by Equitable Mortgage of factory land & building, hyphothication of
plant & machineries, hypothecation of stock & book-debts, Equitable Mortgage & Hypothecation
of collaterals from associate concern & relatives of directors and guarantee of directors, their
relaives and associates.
Term Loan From Financial Institutions
Amt O/s
Rs.41,255,000/- Secured by Hypothecation of windmill plant & machineries and Equitable
Mortgage of its leasehold land rights being financed, Equitable Motgage of collaterals from
directors and guarantee of directors.
Vehicle Loan From Banks & Financial Institutions
Amt O/s
Rs.2,066,675/- Secured against hypothecation of vehicles.
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Annual Report 2009-201050
4 Managerial Remuneration to Directors
2009-2010 2008-2009
a) Salaries, Perquisites & Allowances - 4,500,000
b) Sitting Fees 195,000 185,000
195,000 4,685,000
2009-2010 2008-2009 *
5 Payment to Auditor
a) Statutory Audit Fees 175,000 175,000
b) Tax Audit Fees 50,000 50,000
225,000 225,000
* excluding service tax
6 C.I.F. Value of Import- 2009-2010 2008-2009
a) Raw material - 18,879,960
b) Stores and spares 30,866,077 15,752,308
c) Capital goods - 4,162,154
d) Merchanting Goods 18,003,750 -
48,869,827 38,794,422
7 The value of raw materials consumed 2009-2010 2008-2009
Rs. % Rs. %
a) Raw material
i) Imported 1,098 0.00% 34,718,411 17.28%
ii) Indigenous 232,852,228 100.00% 166,177,728 82.72%
232,853,326 100.00% 200,896,139 100.00%
b) Store, spares, polishing and packing materials
i) Imported 33,359,517 49.59% 24,654,001 39.15%
ii) Indigenous 33,917,209 50.41% 38,312,338 60.85%
67,276,726 100.00% 62,966,339 100.00%
8 Expenditure & Earnings in Foreign Exchange 2009-2010 2008-2009
a) Machinery Maintenance 652,947 -
b) Earnings for sale of goods 409,446 1,548,246
9 Raw Material Consumption Pattern 2009-2010 2008-2009
Qty. in M.T. Rs. % Qty. in M.T. Rs. %
Vitrified Tiles Unit
a) Felspar Powder 43,462 80,521,144 36.64% 29,968 57,498,750 30.42%
b) Ukrain Clay 737 4,444,781 2.02% 3,320 20,037,846 10.60%
c) China Clay 26,507 28,080,124 12.78% 4,071 8,716,918 4.61%
d) Other Material 20,975 106,717,416 48.56% 28,186 102,757,906 54.37%
91,680 219,763,465 100.00% 65,545 189,011,420 100.00%
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Annual Report 2009-2010 51
2009-2010 2008-2009
Qty. in M.T. Rs. % Qty. in M.T. Rs. %
Alluminium Composite Panel Unit
a) Alluminium Coils 48.97 9,479,760 72.42% 38.61 5,824,036 49.00%
b) Plastic Granuals 67.08 3,023,734 23.10% 93.26 5,247,604 44.15%
c) Adhesive Films 2.78 586,366 4.48% 3.96 813,080 6.84%
118.83 13,089,861 100.00% 135.83 11,884,719 100.00%
10 Exceptional Items
During the year ended March 31, 2010, the company has to pay to customers amount of Rs. 45.12
lacs on account of damaged goods claim lodged by the parties. This being expenditure of exceptionally
high looking to the volume of business, the company has identified Rs. 38.44 lacs as exceptional item
of the expenditure being over and above normal expenditure considered and identified at Rs. 6.68
lacs.
11 During the financial year, as per the terms of equity convertible warrants issued, the company received
application cum allotment money of Rs. 776.53 lacs for 2,82,37,500 equity convertible warrants at
Rs. 2.75 each {including premium of Re. 0.25 per warrant} out of exercise price of Rs 10.25 per equity
share. Out of the total proceeds of Rs. 776.53 lacs; Rs. 570.00 lacs are lying as investment with
interest bearing inter corporate deposits pending the utilization. The remaining amount has been
utilized during the year for general corporate purpose in terms of the object of the issue.
12 Deferred Tax Liability Comprise of the following 2009-2010 2008-2009
a) Deferred tax liabilities
Related to Fixed Assets 114,459,276 117,195,782
Related to Deferred Revenue Expenditure 2,038,352 2,989,583
116,497,628 120,185,365
b) Deferred tax assets
Related to Unabsorbed Depreciation 41,863,291 30,551,636
Related to Provision for Gratuity 705,476 307,902
Related to Minimum Alternate Tax Credit 16,708,967 17,750,874
59,277,734 48,610,412
Deferred Tax Liability {Net} (a-b) 57,219,894 71,574,953
13 Earning Per Share 2009-2010 2008-2009
Net Profit after tax and after exceptional items (Rs.) (13,564,004) 28,224,714
Net Profit available to equity share holders (Rs.) (13,564,004) 28,224,714
Add: Exceptional items and tax thereon (Rs.) 3,843,992 8,554,882
Net Profit after tax and before exceptional items (Rs.) (9,720,012) 36,779,596
Weighted Nos.of Equity Shares used as denominated for
calculating the Basic EPS 18,335,444 18,335,444
Weighted average nos. of potential equity that coulde arise
on conversion of equity warrants. 2204846 -
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Annual Report 2009-201052
Dilutive Shares for the year 38051 -
Weighted Nos.of Equity Shares used as denominated for
calculating the Diluted EPS 18,373,495 18,335,444
Basic EPS Before Exceptional Items (Rs.) (0.53) 2.01
Dilluted EPS Before Exceptional Items (Rs.) (0.53) 2.01
Basic EPS After Exceptional Items (Rs.) (0.74) 1.54
Dilluted EPS After Exceptional Items (Rs.) (0.74) 1.54
14 Information pursuant to the provision of Part II of Schedule VI of The Companies Act, 1956.
2009-2010 2008-2009
a) Capacity & Production
Product : Vitrified Tiles
Licensed Capacity - Not Applicable
Installed Capacity (on continuous process basis)-In MT 64000 64000
Actual Production - In MT 61981 47159
Product : Alluminium Composite Panel
Licensed Capacity - Not Applicable
Installed Capacity (on per shift basis)-In Sq Mtrs. 700000 700000
Actual Production - In Sq. Mtrs. 40703 31890
b) Turnover and Closing Stock of Manufactured Goods
2009-2010 2008-2009
Qty. Qty.
Vitrified Tiles Unit in M.T. Rs. in M.T. Rs.
Turnover 59,537.09 743,401,256 46,450.98 673,894,897
Closing Stock 7,694.07 92,728,089 5,250.33 74,514,789
Alluminium Composite Panel Unit in Sq. Mtr Rs. in Sq. Mtr Rs.
Turnover 42,988.73 22,784,227 25,654.67 11,825,752
Closing Stock 3,949.30 1,585,259 6,235.04 2,782,486
c) Consumption of Raw Material
Vitrified Tiles Unit 91,680.30 219,763,465 65,545.00 189,011,420
Alluminium Composite Panel Unit 118.83 13,089,861 135.83 11,884,719
d) Opening Stock, Purchase, Sales & Closing Stock of Merchanting Goods (Tiles, Other Building
Materials & Commodity Items) 2009-2010 2008-2009
Qty. Rs. Qty. Rs.
in Box/Sheets/MT in Box/Sheets
Opening 132,502 27,571,995 199 1,238,155
Purchase 247,822 48,203,675 369,934 53,337,057
Sales 294,650 72,990,190 237,431 38,673,798
Transfer 5,749 229,504 199 1,238,155
Closing Stock 79,926 15,382,349 132,502 27,571,995
2009-2010 2008-2009
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Annual Report 2009-2010 53
15 Disclosure under Accounting Standard - 15 (Revised) on ‘Post Employment Benefits’
Gratuity Benefits
The Company has defined benefit gratuity plan. Every employee who has completed five years or
more of services gets a gratuity on departure at 15 days salary (Last drawn salary) for each completed
year of service.
The following table summarizes the component of net benefit expenses recognized in Profit & Loss
Account.
(I) Changes in the present value of the defined benefit gratuity plan are as follows:
Particulars 2009-10 2008-09
Opening defined benefit obligation 757,182 148,678
Interest Cost 41,645 8,177
Current Service Cost 224,270 104,226
Benefit Paid - -
Actuarial Gain/(Losses) on obligation 354,137 496,101
Closed Defined benefit obligation 1,377,234 757,182
(II) Change in Fair Value of Asset
Particulars 2009-10 2008-09
Fair Value of Asset at beginning - -
Expected Return - -
Employer’s Contribution - -
Actuarial Gain/ (Loss) - -
Fair Value of plan asset at end - -
(III) Details of defined benefit gratuity plan
Particulars 2009-10 2008-09
Defined benefit obligation (A) 1,377,234 757,182
Fair Value of plan asset (B) - -
Present value of Unfunded obligation (C=A-B) 1,377,234 757,182
Less: Unrecognized past service Cost (D) - -
Plan Asset/ (Liability) (E=C-D) 1,377,234 757,182
(IV) Net Employee Benefit expenses in Profit & Loss Account
Particulars 2009-10 2008-09
Current Service Cost 224,270 104,226
Interest Cost on benefit obligation 41,645 8,177
Expected return on plan assets - -
Net Actuarial Gain/(Loss) recognized in the year 354,137 496,101
Past Service Cost - -
Net Benefit Expense 620,052 608,504
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Annual Report 2009-201054
(V) Amounts for the current and previous periods are as follows:
Particulars 2009-10 2008-09
Defined Benefit obligation 1,377,234 757,182
Plan Assets - -
Surplus / (Deficit) 1,377,234 757,182
Experience adjustments on Plan Liabilities 556,774 496,101
Experience adjustments on Plan Assets - -
(VI) The principal assumption used in determining the defined benefit gratuity plan
obligations are shown below.
Particulars 2009-10 2008-09
Retirement Age to be Assumed at 58 58
Rate of Discounting 6.25% 5.50%
Future Salary rise 5.00% 5.00%
Attrition Rate 50.00% 50.00%
Mortality Rate LIC (1994-96) Ultimate LIC (1994-96) Ultimate
Gratuity Limit 350,000 350,000
The estimated future salary increases, considered in actuarial valuation, takes into account the
effect of inflation, seniority, promotion and other relevant factors such as supply and demand in
the employment market.
16 Segment Information:-
The company has identified two reportable segment viz. “Manufacturing and Trading of tiles and
other building materials” & “Wind Power Generation”. The other items which is not related to wind
power generation and not being of significant value has been shown along with main reportable
segment of manufacturing and trading of tiles & other building materials.
Segment have been identified and reported taking into account nature of product and services and
deferring risk and rewards from them. The accounting policies adopted for segment reporting are in
line with the accounting policy of the company with following additional policies:
(a) Revenue and expenses have been identified to a segment on the basis of relationship to the
corresponding segment. Revenue and expenses, which relate to enterprise as a whole and are
not allocable to a segment on reasonable basis, have been deducted from total column.
(b) Segment assets and segment liabilities represents assets and liabilities in respective segments.
Assets and liabilities that cannot be allocated to as segment on a reasonable basis have been
disclosed as ‘Unallocable’.
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Annual Report 2009-2010 55
(I) Primary Segment Information: Amount Rs. In Lacs
Figures in brackets shows previous year figures
Particulars Tiles and other Wind power Total
building material generation
Segment Revenue 8,581.36 549.69 9,131.05
External Income (6,904.54) (404.79) (7,309.33)
Total Income 8,581.36 549.69 9,131.05
(6,904.54) (404.79) (7,309.33)
Segment Result Before Interest and Taxes 82.56 404.76 487.33
(634.14) (267.18) (901.32)
Less: Interest & Finance Charges 714.20 58.55 772.75
(607.10) (42.34) (649.44)
Add: Interest Income 44.67
(55.72)
Profit Before Tax & Before Exceptional Items -240.75
(307.59)
Exceptional Items 38.44
(96.48)
Profit Before Tax & After Exceptional Items -279.19
(211.11)
Less: Tax Expenditure -143.55
-(71.13)
Profit After Tax -135.64
(282.25)
Other Information
Segment Assets 13,153.34 2,087.38 15,240.72
(12,885.90) (2,285.91) (15,171.81)
Unallocated Assets 669.84
(106.36)
Segment Liabilities 1071.78 417.48 1489.26
(881.90) (451.59) (1,333.49)
Unallocated Liabilities 6,177.22
(6,341.33)
Capital Expenditure 349.60 - 349.60
(1,539.90) - (1,539.90)
Depreciation 397.16 124.69 521.86
(358.00) (124.69) (482.70)
Non cash expenses other than Depreciation 35.64
(38.05)
The reportable segment is further described below:
(i) Manufacturing of vitrified tiles & alluminium composite panels Trading of other ceramic
tiles and commodities items, Work contracts for ceramic and alluminium section works.
(ii) Power generation for captive consumption through installation of windmill.
(II) Secondary Segment Information:
The major and material activities of the company are restricted to only one geographical
segment i.e. India, hence the secondary segment disclosure are not applicable.
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Annual Report 2009-201056
17 Related Party Disclosures:As per Accounting Standard 18, issued by the Institute of Chartered Accountants of India, the disclosure of
the transactions with the related parties as defined in the Accounting Standard are given :
List of Related Parties along with relationship and Transactions :-
Associates
Decogold Glazed Tiles Ltd.
Decogold Electronics Ltd.
Sweta Ceramics
Aristo Ceramics
Relatives Of Key Management Personnel
Mayur K. Pethapara
Hemal G. Pethapara
Hiralben Girishbhai
Poonamben Mansukhbhai
Ramaben M. Pethapara
Sadhnaben B. Kadivar
Vasantaben R. Patel
Lataben K. Pethapara
Key Management Personnel
Girishbhai M. Pethapara
Jayantilal M . Pethapara
Kantilal M. Pethapara
Amount Rs. In LacsFigures in brackets shows previous year figures
Particulars Associates Relatives of Key Key ManagementManagement Personnel
PersonnelTransactions
Purchase of Goods 270.68(358.41)
Remuneration / Salary & Perquisites Paid Nil Nil
(3.25) (45.00)Rent Paid 2.44 0.14
(3.60) (0.14)
Loans / Deposits Taken 44.65(8.50)
Loans / Deposits Repaid 44.65
(8.50)Advances Given for Capital Items/Consumables 5.36
(123.77)
Receipts towards Advances Repayment 5.36(123.77)
Advances Given to suppliers 102.83
(20.06)Sales incentives & Special Discount Received 49.01
(31.87)
Outstanding BalancesAdvances to suppliers 102.83
(20.06)Sundry Creditors for Expenses 0.27 0.03
(1.85) (7.08)
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Annual Report 2009-2010 57
18 The company has taken certain premises, factory building, godown & land under cancelable operating
leases. The total rental expenses under cancelable operating lease during the year was Rs. 83.80 lacs
(Rs. 61.22 lacs).
19 Based on the information / documents / parties identified by the company and to the extent information
available / gathered, informations as required to be disclosed as per Micro,
Small and Medium Enterprise Development Act, 2006 have been determined as follows:
Rs. In Lacs
2009-2010 2008-2009
Principal amount remaining unpaid to any
supplier at the end of the year. 11.29 45.56
Interest due on above 4.35 3.17
Amount of interest paid by the company to the suppliers - -
Amount paid to the suppliers beyond respective due dates *
Amount of interest due and payable for the period of delay
in payments but without adding the interest specified
under the Act. *
Amount of interest accrued and remaining unpaid at the
end of the year. 4.35 3.17
Amount of further interest remaining due and payable even in
the succeeding years, until such date when the interest dues
as above are actually paid to the small enterprise. 4.35 3.17
* Whatever information the company could identify as above were possible at the year end only, and
in view of the this according to the company, it could not identify payments beyond due date during
the year and to make interest provisions to that extent, due to numerous transactions concluded
during the year as per the agreed terms with the suppliers. However, the company has made due
interest provisions over the requisite year end balances.
20 Contingent Liabilities* Rs. In Lacs
2009-2010 2008-2009
Counter guarantee given to the banks against guarantee
issued by banks on behalf of company. 185.27 185.27
Letter of credits issued by the bank on behalf of the company. - 74.65
Excise matters under dispute and under adjudication. 58.50 58.50
(However the company has paid Rs. 6.94 lacs under protest)
Excise search operations matter 980.26 980.26
(The company has paid under protest a sum of Rs.400
lacs as a part of bail condition of court of law at the time
of search operations. The company / directors have further
submitted solvency certificate for Rs. 325 Lacs to the
lower court as per the order of Gujarat High Court.
Presently matter pertaining to the show cause notice for
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Annual Report 2009-201058
duty of Rs. 490.13 Lacs and the amount shown
hereinabove of Rs. 980.26 Lacs as contingent liability
including alleged penalty , is pending for adjudication
at Central Excise Department.)
* Contingent liability produced here in above on the bases of
information compiled by the management of the company
21 Dues from the other companies under the same management at year end is as below:
Deco Gold Glazed Tiles Ltd. Rs. 102.83 Lacs./- (Rs. 20.06/- Lacs).
22 In opinion of the Board of Directors of the company Net Current Assets are approximately of the
same value as stated, in the normal course of business, and adequate provision has been made for all
know liabilities.
23 Wherever confirmation of the parties for the amounts due to them / amounts due from them as per
books of accounts are not received, necessary adjustments, if any, will be made when the accounts
are reconciled / settled.
24 Wherever no vouchers and documentary evidences were made available for our verification, we
have relied on the authentication given by management of the company.
25 Figures have been rounded off to nearest rupee and have been regrouped, rearranged and reclassified
wherever necessary.
Signature to Schedules ‘A’ to ‘T’
As per our report of even date For and on behalf of the BoardFor SVK & ASSOCIATES For DECOLIGHT CERAMICS LTD.Chartered Accountants
Shilpang V. Karia Girishbhai M. Pethapara Kantibhai M. PethaparaPartner Managing Director Joint Managing DirectorMembership No.: 102114Firm No. 118564WPlace : Morbi Ramachandran Pillai Place : MorbiDate : 12th August, 2010 Company Secretary Date : 12th August, 2010
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Annual Report 2009-2010 59
I REGISTRATION DETAILS
Registration No. L26914GJ2000PLC 0 3 7 4 9 4 State Code 0 4
Balance Sheet Date 3 1 0 3 2 0 1 0
II CAPITAL RAISED DURING THE YEAR (Rs. in 000’s)
Public Issue Right Issue
N I L N I L
Bonus Issue Private Placement
N I L 7 7 6 5 3
III POSITION OF MOBILISATION AND DEPLOYMENT OF FUNDS (Rs. in 000’s)
Total Liabilities Total Assets
1 4 0 7 5 2 6 1 4 0 7 5 2 6
Sources of Funds : Paid-Up Capital Reserve & Surplus
1 8 3 3 5 4 5 7 0 4 5 9
Deferred Tax Liability Secured Loans
5 7 2 2 0 5 2 5 8 9 8
Unsecured Loans Share Application Money
1 0 9 5 7 0 5 9 4
Application of Funds: Net Fixed Assets Net Current Assets
7 7 6 1 6 8 5 5 4 1 2 7
Investments Misc. Expenditure
5 9 9 1 1 1 7 3 2 0
IV PERFORMANCE OF COMPANY (Rs. in 000’s)
Turnover/Other Income/Stock Total Expenditure
9 1 3 6 1 3 9 4 1 5 3 2
Profit/Loss before Tax Profit/Loss after Tax
– 2 7 9 1 9 – 1 3 5 6 4
(Please tick Appropriate Box + for Profit - For Loss)
Earning per Share in Rs. Dividend rate % (Equity Shares)
– 0 . 7 4 N I L
V GENERIC NAMES OF THREE PRINCIPAL PRODUCS/SERVICES OF COMPANY(as per monetary terms)Item Code No. :(ITC Code) 69071010Product Description VITRIFIED TILESItem Code No. :(ITC Code) 76109030Product Description ALUMINIUM COMPOSITE PANELS
Balance Sheet Abstract
BALANCE SHEET ABSTRACT AND COMPANY’S GENERAL BUSINESS PROFILE
PART IV
Girishbhai M. Pethapara Kantibhai M. PethaparaManaging Director Joint Managing Director
Ramachandran Pillai Place : MorbiCompany Secretary Date : 12th August, 2010