Beruflich Dokumente
Kultur Dokumente
contents
Letters to Shareholders Our Differentiators Achievements 2003-04 Board of Directors Management's Discussion & Analysis Directors' Report Corporate Governance Annual Accounts/Financials
Moser Baer India Limited European Optic Media Technology GmbH (Europtic) Consolidated Financial Statements
04 11 15 18 22 44 53 70
deepak puri
ratul puri
EXECUTIVE DIRECTOR
Timing is everything
In this new world timing is everything. The right time to invest, the right time to market, the right time to enter a product and the right time to exit and move forward. At Moser Baer, this is our strength. We have cultivated the foresight to predict market movements and embrace change. We first invested in optical discs at a time when the market was in a downturn by correctly anticipating the underlying growth drivers and long-term market potential. At the same time, we accurately foresaw the very powerful long-term competitive advantage that an India based enterprise could offer in an evolving industry; a highly skilled workforce, a competitive cost structure, and a differentiated manufacturing option. We have consistently synergised our research, engineering, manufacturing capabilities to our marketing network to optimize our time to market and maximize return on investment and emerge as a market leader and the most profitable player in the removal storage media industry.
Destination Next
As a prominent player on a worldwide canvas, Moser Baer understands its leadership responsibilities. We recognise the need to make the most of our strong research, development and engineering capabilities to deliver even higher value added products to markets, while continuing to focus on increasing production efficiencies and yields to further increase our cost leadership globally. The exploding global market in DVD and the growing disposable income levels within the domestic market presents immense scope ahead and we are well positioned to exploit this emerging opportunity. We intend to leverage our manufacturing base, expanded capacities, customer relationship and the explosive growth to significantly enhance our global share and not merely retain, but further improve our leadership position within the industry. In addition, we intend to utilize our core mass manufacturing capabilities, especially in high technology process driven industries to capitalize on the growing global trend towards outsourcing. Our strong core expertise in thin film coating provides us multiple opportunities in a number of high growth areas both within and outside storage media industry. Together, this canvas represents Destination Next at Moser Baer.
p m pai
PRESIDENT
Strategic Themes
The Moser Baer corporate scorecard rests on five broad strategic themes of Long Term financial stability, Customer first, Process standardization, Operational excellence and Employee engagement. These, in turn, flow into the strategic objectives. It goes without saying that long term financial stability would require strong pillars of ROCE, revenue growth, profitability, asset utilization and cost leadership for sustenance. Similarly, a customer first choice orientation would require a first to market approach, relentless focus on customer satisfaction and relationship management. Having entered the branded segment in the domestic market, it would also need sustained effort in maintaining leadership. Process standardization needs to be all encompassing. Not only in the manufacturing processes, but also in our financial processes including budgeting and control. In addition, we are focusing on standardization of our supply chain management processes as well as our HR processes. This is symbiotic with operational excellence, which would focus on process improvement, supply demand balancing and cycle time reduction.
Change... in speed
At the macro level, the global storage market is transitioning from analogue to digital. Our Optical disk world, not only evolves from one format to another, but within formats we see continuous change, with write speeds increasing by as much as 10 fold in short periods of time. Working hand in hand with drive manufacturers we have built a strong capability to deliver cutting edge products to our customers, allowing us to command a premium position for our products in the marketplace.
our differentiators
What makes us who we are? Is it our fierce commitment to quality, our dogged determination to take the 'Made in India' label to the world, or our constant efforts to offer the best to our customers? Is it our efficiency in manufacturing, the agility with which we navigate the changing market, or our love of innovation and change? It's all of the above factors put together that sets us apart. Our industry is driven by change and rapid innovation. At Moser Baer, we believe that we can stay ahead in the race by reacting swiftly to these changes. That's why we have unique, result-oriented systems and strategies in place, which enable us to operate flexibly. But that's not the only reason why we're different, or why we're considered among the top players in the global market for optical media storage products.
Efficient Manufacturing: It's tough to sustain yourself without efficient manufacturing. We know this well, which is why we have built innovative solutions to manage mass manufacturing. The capabilities of our engineering and design, production lines, processes and manufacturing facilities allow us to move quickly from the concept stage to the finished product. By engineering and designing our own facilities along with our equipment vendors, we've maximized quality and reliability, while reducing our capital investment costs. Our human resources are exceptionally strong. In fact, we've leveraged our high quality and low cost human resource base to create one of the highest ratios of technically qualified personnel in the industry. Due to the vertical integration of our manufacturing operations, we are able to monitor quality and minimize costs. Our manufacturing facilities are also highly flexible, allowing us to minimize obsolescence risks and adapt swiftly to changes in the market. For instance, our format-flexible production equipment lets us switch seamlessly between different formats without incurring high investment costs. Speed: Our objective is to be first-to-market. Which means, we've got to respond to the twists and turns of the market with speed and agility. In fact, we do it rather well and rapid commercialization is one of our key core competencies. Responding to change with speed is like a reflex action for us, something that's intrinsic to the organization's culture. Using our expertise, we try and develop new technologies as rapidly as possible. What helps us achieve speed is our decentralized yet cohesive organizational structure that makes it easy to take decisions. And get moving on the job. R&D: Our strong research and engineering base allows us to rapidly introduce products in the market. We view R&D as an
enabler that allows us to effectively deliver products to customers. Our R&D is of an applied nature that focuses on results. In this way, it differs from the traditional and basic R&D that companies undertake. We produce virtually all our products using proprietary in-house technologies. We attempt to understand customer requirements and develop processes that suit their needs. Recently, in an unique partnership, we developed a specific solution for one of the world's best-known PC makers, which enabled them to provide value to their customers. Our R&D alliances with other global companies have resulted in the development of acclaimed product and process innovations. The company spent INR 306 million on R&D during the year, amounting to 1.9 per cent of total revenues. The company has over 80 people in its R&D division, with a extensive and wide range of expertise. This has enabled the company to launch new and innovative products and also helped increase production efficiencies and process yields.
Quality and Cost: We believe that our commitment to providing quality products to customers has been vital to our
success. We are always looking to innovate on ways to reduce costs, so that we can pass on the benefit to our customers. To this end, we have very structured cost-reduction programmes in place across all functional areas. At any point in time, you'll always find several QICR, or quality implementation and cost reduction programmes, running simultaneously across our operations. We're also fanatically obsessed with measurement, to the point that we try and measure and benchmark every aspect of our business in order to improve it. The goal is to make every business process predictable and scientific, in order to reduce our timeto-market. Our commitment to quality also reflects in the fact that our manufacturing facilities are certified by several leading international certification bodies. Our newest manufacturing facility at Greater Noida achieved ISO 9002 within 12 months of beginning production. There is a strong focus on quality control across the organization, not least because we have invested in regular quality training and invested in building a quality conscious culture. Not to mention that our emphasis on quality means that we have an extremely low defect rate, one of the lowest in the industry.
Customer Focus: In our business, building and sustaining customer relationships is critical, which is why our company
is driven by a strong customer focus. Our customer focus is evident in the fact that we've never lost a customer. On the contrary, we're hailed by our customers as being the most flexible and innovative supplier. That's because we integrate and align ourselves with our customers by trying to understand their requirements and developing specific programmes that often exceed their expectations. This in turn enables them to differentiate themselves in the market and thus add value to their products. By integrating our IT system with those of our customers, we enable them to check the status of their deliveries online from anywhere in the world.
Supply Chain and Logistics: At Moser Baer, we realize that an efficient and seamless supply chain is crucial to our
global competitiveness. That's why we've invested so much thought and energy into ensuring that all our supply chain operations are linked and customer deliveries are made swiftly and at a minimal cost. The entire production planning process works in perfect synergy with our logistics department. We are, in fact, a bit of a trendsetter in the way exports are handled in north India and there are several 'firsts' to our credit. For instance, the first round-the-clock customs clearance facility at ICDs was introduced at our insistence. Similarly, we were the first company to have dedicated export trains for Moser Baer. We're also one of the few companies to provide total logistics solutions to our customers. We've even built our own in-house software for managing inbound and outbound shipments to help track documents and containers instantly.
People Skills: We're nothing without our intellectual capital. The power of this capital is reflected in process efficiencies,
reengineered equipment, enhanced productivity, low manufacturing cost and new product launches, amongst others. We've also taken innovative steps to conserve our intellectual capital. For instance, we have a merit-led remuneration system. We also regularly invest in the training of our people. And we have incorporated and benchmarked the best HR practices. Needless to say, this has been a key driver of our success.
Change Managers: Our proactive approach to current and future challenges makes us good at dealing with change.
In our industry, where short market cycles, rapid growth and the constant introduction of new products are routine, staying ahead can be tough. With our systems approach to forecasting business cycles, however, we have been able to employ our capital at the right time for the right product in the right market. When we spot an opportunity, we are able to leverage our technological capabilities to maximise benefits from any change in the environment. Our entry and exit into any market is pre-determined and always follows a specific plan. In fact, we have accurately forecasted technological changes thereby enabling us to be first-tomarket with new products. Our expertise, capabilities and flexibility also stand us in good stead to develop complementary products outside our core business of optical media manufacturing.
Marketing Strategy:
Our marketing strategy is differentiated, to enable us to minimize our risk and optimise the value we offer to our customers. We have been able to build long term relationships with our customers, which offers stability and mitigates business risk. Our aim is to not simply provide them with products but with integrated solutions. Our global marketing offices, subsidiaries and logistical and distribution centres make it possible for us to react quickly to customer requirements. In India, we launched the Moser Baer brand of storage media and are now enjoying a 25 per cent domestic market share in high value branded segments.
Financial Strategy: As we operate in a high-growth and capital-intensive industry, efficiently financing our rapid growth
is a critical factor driving competitive advantage. We are prudent when it comes to financial management. Our prudent mix of equity, debt and internal accruals to finance our expansion plans has yielded significant returns and has helped us achieve a conservative risk to cost ratio. Over the past five years, we have successfully raised almost USD 350 million from international and domestic lenders and USD 229 million from capital markets. Our overall goal is to maximise returns on invested capital and increase the spread over weighted average cost of capital.
Change... in format
Driven by emerging new applications and evolving end-user requirements, formats are destined to change in our industry, which is why Moser Baer plans its entry and exit precisely to maximize returns on investment. From diskettes to CDs to DVDs we have been at the cutting edge of change as the world changed from analog to digital and promise to continue to do so as we move into the future.
achievements 2003-04
What have we achieved this year? We've managed to grow, attract new customers and increase production efficiencies. We've built a brand, introduced new products and managed to sustain our state-of-the-art manufacturing facilities. Revenues and earnings have grown substantially, and so has our global market share. Yet, it's been a year of mixed fortunes. On the upside, the market for CD and DVD Recordable discs in India is expected to grow at over 50 per cent annually, and the brand has made significant inroads into the domestic market. On the other hand, we have seen a significantly competitive market environment emerge, resulting in a need for us to intensify our efforts at cost reduction, increase our investments in technology and R&D, create better platforms to service customers, and over all enhance the value package we deliver to customers.
The Greater Noida manufacturing complex: Our Greater Noida facility is the largest single-site optical
media production facility in the world. Within one year, we've ramped up operations at the facility in order to meet the increasing demand for optical media products. Civil construction facilities for the second phase of expansion at this facility began in October 2003. The modular structure of the Greater Noida facility, along with the existing infrastructure and utilities, has provided the company with the flexibility to quickly react to changes in market conditions at lower incremental costs.
DVD manufacturing: A year after we started mass manufacturing of the DVD Recordable and Rewritable formats,
we've made serious progress in R&D and significantly ramped up production capacities. In the short span of one year, we launched new products including the 2X, 4X and 8X DVD Recordable and the 2.4x and 4X DVD Rewritable formats. We believe that our early leadership position in the DVD formats gives us a significant advantage over the next 2-3 years to capitalize on the explosive growth that is expected.
Revenues: We substantially increased gross revenues to INR 15,792.2 million, a growth of 45.5 per cent over FY02-03. We
were ranked amongst the fastest growing companies (for our size and scale) in the country.
EBITDA: EBITDA (net of other income) at INR 6,359.0 million grew by 67.8 per cent over FY03. Also, EBITDA margins (net of
other income) rose to 41.4 per cent in FY04 as compared to 39.0 per cent in FY03.
Earnings: Our net earnings after current years tax grew 50.7 per cent, over FY03, to INR 3577.2 Million . However, net profit for
the year after making provisions of INR 338.7 million for previous year/ deferred tax, grew 36.5 per cent to 3238.5 million in FY04.
GDRs: During the year we raised INR 6753.6 million, by placing Global Depository Receipts (GDR) and warrants with affiliates
of Warburg Pincus LLC. The proceeds from this issue will be used mainly to grow our DVD capacities during the coming year.
Capacity Building: The company has almost doubled its production capacities during FY04, with an increment of only
38 per cent in its gross fixed assets. Using our in-house design and development capabilities, we managed to reduce our investments to USD 170 million, which was substantially below budgeted levels. We also substantially grew our finishing, fulfilment and global delivery capabilities, which will enable us to substantially improve our total value delivery system to customers.
Brand building: Our brand initiative in the domestic market got off to a successful start. In the first year of operations itself,
the brand of storage media products has been able to garner a market share of 25 per cent.
Global Market Share: We've acquired new customers, scaled up existing customers and within a short time became
a vital part of their global supply chain.
Investment in IT: We continued our strong investments in technology, integrating our entire supply chain from vendors to
customers. This internal and external integration, has significantly reduced our time to market.
Human Resources: We added 1661 personnel during the year, and significantly increased the number of shares
under our ESOP scheme to 4.4 million from 2.2 million, in a continuing effort to provide members of the organization with a shared sense of ownership.
Change... in environment
The environment we operate in undergoes continuous change. We have engineered models to accurately predict this change and are an active participant in the standard setting bodies that drive these changes. This enables us to be proactive in the new environment, effectively reducing the risk profile of our business, while enhancing the rewards.
Change is the law of life, and those who look only to the past or the present are certain to miss the future.
- John F. Kennedy
boards of directors
deepak puri
MANAGING DIRECTOR
Deepak Puri provides strategic direction to the company. He is the driving force in creating an environment of integrity, fair business practices, a respect for intellectual property and a ceaseless quest for human capital development. He is also the chairman of Electronics and Computer Software Export Promotion Council (ESC), a non-profit, autonomous organisation of the Ministry of Information Technology, Government of India. He holds a master's degree in mechanical engineering from Imperial College, London, and is an alumnus of St. Stephen's College and Modern School, New Delhi.
ratul puri
EXECUTIVE DIRECTOR
Ratul Puri joined Moser Baer in 1994 and has been Executive Director since 2001. Prior to his assuming the Directorship, Ratul was General Manager - Business Development. In this capacity, he was instrumental in setting up plants for manufacturing compact discrecordables, the first to come up in India.
harnam wahi
DIRECTOR
Harnam Wahi brings a wealth of experience and global expertise to the Board of the company, having worked in various senior positions in prestigious Indian and international organizations such as the Inchcape Group, London; Flender Macneill & Co, Germany; Johnstan Pumps (India) Ltd; Containers & Closures Ltd; Dewrance Macneill & Co Ltd; Kilburn & Co. Ltd; Ganges Printings Co. Ltd; and Ganges Rope Co. Ltd. and was closely associated with several industry associations.
nita puri
Nita Puri is a whole-time Director. A graduate from Calcutta University, she has 31 years of business experience. As Director (Administration and HR), she has been closely involved with the company since inception.
prakash karnik
DIRECTOR
Prakash Karnik is an engineer from the reputed Indian Institute of Technology (Madras) and a management graduate, he has over 25 years of work experience in the engineering and finance sectors. He has worked in senior positions in the government and private sector organisations such as Jardine Fleming India Securities Ltd, Unit Trust of India, Economic Development Corporation of Goa Ltd, amongst others.
rajesh khanna
DIRECTOR
Rajesh Khanna has been working with Warburg Pincus for the last six years. He is an MBA from Indian Institute of Management, Ahmedabad, and also a Chartered Accountant. He has worked with leading finance and consulting firms such as Citibank N.A., and Arthur Andersen & Co.
bernard gallus
DIRECTOR
Bernard Gallus brings to the companys Board over 40 years of experience in international technology and finance. He was earlier Managing Director and member on the Board of J. Bosshard S.A. Lausanne, later taken over by W Moser Baer AG, Switzerland.
Arun Bharat Ram graduated in Industrial Engineering from the University of Michigan, USA. He started his career with DCM Ltd., moved to SRF Ltd. as Managing Director in 1975 and appointed Vice Chairman in 1988. He played a key role in professionalising the company. He has been on various Government-Industry Committees. He is ex- President of the Association of Synthetic Fibre Industry and has served on the Managing Committee of Development Panel on Man-Made Fibre Industry. He has been the Chairman of Indo-Korea Joint Business Council. He was earlier Chairman of the Northern Region of Confederation of Indian Industry (CII) and is the past President of the National Body of CII. He is also deeply involved in the field of education and philanthropy.
john levack
DIRECTOR
John Levack is Managing Director of Electra Partners Asia Limited. He has over 20 years of private equity experience with Electra and 3i plc in Asia and Europe, four years of which have been in India. He is a director at Aksh Optifibre Limited, Zensar Technologies Limited, SPI Technologies Inc., Meghmani Organics Limited and RT Packaging Limited. Mr Levack has a degree in Business Administration from Bath University in UK.
organisation chart
Mr V J Prakash MD - European Mfg. Proj. Mr Robert O'Donnell GM - European Operation Mr B Bartholomeusz VP - Strategic Initiaves Mr D P Nanda GM - Commercial Mr Ratul Puri Executive Director Mr M Kobayashi VP - Japan Mr Vivek ChaturvedI GM - Intl Sales & Mktg Mr Rakesh Govil Head Strategy & Treasurer Mr Tarun Jaitly GM - Investor Relations Mr Saurabh Chawla GM - CS & T Mr G R Nyati Head - Engg & Tech
Mr B Ganesh GM - Log. & Supply chain Mr Muthu Kumar GM - IT Mr Naresh Jand GM - Finance
Mr Deepak Puri Chairman & Managing Director Mr Bhasker Sharma VP - Domestic Marketing Mr S Rajalingam Sr GM - Plant A-164 Mrs Nita Puri Director - Admin Mr R W Ghei Sr GM - HR
Mr Ashish Bhanu GM - A/V Mr N C Jain GM - SPAD Mr P M Pai President Mr Anil Bhargava GM - Quality Mr Shiv Nath GM - Operations (OMG) Mr Vijay Bijlani GM - Operations (P&P) Mr V C Agerwal VP - 66GN Mr N K Chaudhary Sr GM - Projects Mr Anil Sawhney GM - Admin
key people
Mr P M Pai President Mr V J Prakash MD - European Mfg. Proj. Mr Brian Bartholomeusz VP - Strategic Business Initiatives Mr Rakesh Govil Head Strategy & Treasurer Mr M Kobayashi VP - Japan Mr V C Agerwal VP - 66 GN Mr Bhaskar Sharma VP - Domestic Marketing Mr G R Nyati Head - Engg. & Tech. Mr S Rajalingam Sr - GM Plant A-164 Mr N K Chaudhary Sr GM - Projects Mr R W Ghei Sr GM - HR Mr Robert O'Donnell GM - European Operation Mr D P Nanda GM - Commercial Mr Vivek Chaturvedi GM - International Sales & Marketing Mr Tarun Jaitly GM - Investor Relations Mr Saurabh Chawla GM - CS&T Mr B Ganesh GM - Log. & Supply Chain Mr Muthu Kumar GM - IT Mr Naresh Jand GM - Finance Mr R Ganesan GM - Accounts Mr Deepak Shetty GM - Domestic Sales Mr Praveen Jaiswal GM - Operations Mr Ashish Bhanu GM A/V Mr N C Jain GM SPAD Mr Anil Bhargava GM - Quality Mr Shiv Nath GM - Operations (OMG) Mr Vijay Bijlani GM - Operations (P&P) Mr Anil Sawhney GM - Admin
Your Company
Moser Baer India, headquartered in New Delhi, India, was established in 1983. The Company has successfully developed cutting-edge technologies for recordable optical media, constantly innovating and introducing new products and process. An emphasis on high quality products and services has enabled Moser Baer emerge as one of India's leading technology companies and the third largest player in the global optical storage media industry. The company currently employs over 4,000 people and has multiple manufacturing facilities in the suburbs of New Delhi. The company services its customers through 6 marketing offices and subsidiaries in India, the US and Europe, and sells its products in over 40 countries globally.
2. DVD-Rs
After a tentative start characterized by a very visible and counter-productive format battle the blank DVD market is now globally established and growing faster than almost anyone anticipated. The prices of both drives and media have reached mass consumption levels. Also, unlike for CD-R writers, the PC manufacturers have from the outset aggressively incorporated DVD writers across their product lines. This integrated availability and a plethora of easy to use software applications have opportunistically capitalized on the global acceptance and momentum generated by CD-R and contributed to the rapid acceptance of DVD-R. DVD recordable drives represented just under 25 per cent of the writable drives shipped in 2003. By the fourth quarter of 2004, DVD drive shipments will be nearly 55 per cent of Writer-drives shipped. The installed-base of DVD drives will nearly triple in CY04 while annualised media consumption increases by over 400 per cent by the fourth quarter of CY04 over CY03's shipments. Demand for DVD-R/RW media formats grew sharply to 675 million units in CY03, against 125 million units in CY02. This number is expected to triple in CY04, with a fourth quarter run rate of 2.9 billion DVD-R/RW discs consumed. The transition to DVD writers is moving as fast as production capacities can ramp up. DVD pricing is expected to continue to fall in the near term as manufacturing costs drop sharply and demand/production volumes rise sharply. In contrast to the past, we see that the storage hardware industry is very aggressively driving the development of format enhancements in an attempt to reverse the severe margin degradation that characterizes any PC peripheral. The 1x-52x CD-R speed race was one example of this. The DVD speed race is well underway with recent 8x product introduction and the expectation of 16x recordable products by year end. In addition, significant efforts are underway to define and develop the next generation blue laser storage format. At this point there are a number of contending format concepts. These formats will provide a platform for the distribution and recording of High Definition Video and basically serve as the linchpin for a major transition to a new class of hardware products in much the same way DVD drove the adoption of more powerful PCs, larger hard drives, surround sound systems, large screen TVs, and the like.
Weaknesses
As Moser Baer continues to grow rapidly, we need to scale up our operation, human resources, management bandwidth, and evolve internal controls in line with the exponential growth. As demand for most of our products is growing extremely fast, we need to constantly expand manufacturing capacities, requiring continuous and high levels of capital investment.
Opportunities
The exploding recordable DVD (DVD-R) market presents the biggest opportunity for our company. With world-class capacities to manufacture DVD's, an existing top-tier customer base, and an efficient in-house developed technology, we are well positioned to exploit this emerging and profitable opportunity. India, with its large population and growing disposable income level represents a big opportunity for us. India has one of the largest music and video industries in the world, publishing thousands of titles each year. India is the second largest compact cassette (audio cassette) market in the world. As consumers shift to using CD's for audio, and DVD's for their video requirements, the domestic market for these products should explode. Moser Baer has a home field advantage in this potential INR 15 billion market (by FY05). A number of new CD and DVD applications are being opportunistically developed. The ability to conveniently transfer video to a computer and edit or otherwise modify it in a random access fashion is proving to be a paradigm shift. Low cost DVD recorders that resemble VCRs and which over time are expected to eventually replace them, are now freely available and increasingly affordable. These devices share a number of common components with DVD-ROM drives and by capitalizing on the economies of scale are expected to drop in price and replace not just VCRs but also DVD Video players. Significant efforts are underway to define and develop the next generation blue laser storage format. With capacities in the +20Gbyte range these formats will provide a platform for the distribution and recording of High Definition Video and basically serve as the linchpin for a major transition to a new class of hardware products. We already recognise the potential that this format offers and are ensuring that we are present right at the commencement of the products life cycle.
Threats
Emerging technologies In a dynamic technology environment, Moser Baer's business could be threatened from more efficient emerging technologies. However, considering the explosive growth in digital content, the low cost and ease of storage on optical media, the huge installed base of both read and write drives and the time to market for a new format, this threat is perceived as low. The company's strong R&D capability and joint R&D programs with leading technology players enables the company to lead innovation rather than trail it. Anti-dumping and anti-subsidy inquiry The company derives a significant part of its revenues from international markets, US and Europe being the most prominent ones. A growing protectionist attitude and a tendency by some local Governments, driven by a desire to protect local jobs, tend to use anti dumping and other trade protection tools to provide some measure of protection to local high cost and inefficient manufacturers. This poses a significant threat to our ability to efficiently access these markets. There are anti-dumping duties imposed by the European Commission (EC) against most of our competitors. While Moser Baer does not have an anti-dumping duty, the EC has imposed a 7.3 per cent anti-subsidy duty on recordable compact discs (CD-Rs) manufactured in India. We are contesting this imposition at various levels. These type of investigations could be instituted again in future and continue to pose a risk to our sales into Europe. However, we are following an active strategy to mitigate this threat by diversifying our global presence, customer base and rapidly moving into newer and larger markets like the USA. Sharp fall in product prices As the products move into the mature phase in their life cycle, they start to emulate commodity type characteristics. Also as the industry is characterised by high volume , large capacities and investments, a sharp reduction in product pricing can severly impact performace. The pricing in the industry could fall due to oversupply, low demand, cost reduction due to reduction in input costs or setting up capacities in low cost regions. In addition to having highly efficient manufacturing process and facilities, Moser Baer has the advantage of being situated in a low cost economy which enables the company to emerge as an extremely efficient manufacturer in the world .
Strategy
Short / Medium term
Our near term strategy is to leverage our manufacturing base, expanded capacities, customer relationships to capture the explosive growth expected in the DVD Recordable formats and to significantly enhance our global share. We believe, the optical media industry in the medium term offers us sufficient growth opportunity with relatively low risk and high returns on invested capital.
Long term
Our long-term strategy is to utilize our core mass manufacturing capabilities, especially in high technology process driven industries to capitalize on the growing global trend towards outsourcing. Our strong core expertise in precision thin film coating provides us multiple opportunities in a number of high growth areas both within and outside storage media industry.
higher value added products to markets. These products are designed to meet the specific enhanced functionality demanded by high end customers. Strengthen customer base Even though we are today supplying to 11 of the 12 largest global brands in the world, we plan to significantly strengthen customer relations by entering into strategic alliances with customers. We also plan to provide our customer base with enhanced quality, product capability, packaging options, and logistic and supply chain capability. Improve geographical sales and distribution Over the last few years, we have significantly reduced our share of sales in the European community and enhanced sales into the North American market. Going forward, we plan to penetrate and grow in emerging markets like China, India, the Middle East and Latin America. Time to market As we move up the technological curve and ally with the leading technology developers within the industry, our ability to bring products to market and rapidly commercialize those products and grow capacities to generate economies of scale are vital to our success in a competitive environment. A number of measures, including the development of flexible manufacturing systems, multiple format ready facilities, and the ready availability of skilled manpower, will enable us to achieve these goals.
Manufacturing
During the year, Moser Baer has almost doubled its media production capacity from 1.1 billion units per annum to 2 billion units per annum, with an increment of only 38 per cent in it's gross fixed assets. At the end of FY04, the company has now cumulatively invested USD 555 million (INR 25160 million) in establishing a world class-manufacturing infrastructure. The company commissioned its new state-of-the-art Mastering and Galvanics facility in July 2003 to manufacture a wide range of stampers for CD-ROM, DVD-ROM, CD-R/RW and DVD R/RW formats. This should help significantly reduce cost and shorten product development times. The company has ventured into backward integration of packaging materials by setting up an integrated facility for the manufacture of high quality Jewel, Slim & Cake Boxes, for meeting the captive requirements of disc packaging. Printing and packaging capacities were additionally ramped up with innovatively designed production flow layouts and material handling systems.
The company continued to take various initiatives in the area of process optimisation, resulting in significantly higher overall equipment efficiency and production yields. Significant reduction in raw material costs were also achieved through improvement in material efficiency yields, closed loop recycling of dyes and enhancement of stamper life. The company continued its forward thrust on building additional capacity to cater to the growing demand for DVD Recordable media. Towards this end, civil construction activities for the second phase of expansion at the Greater Noida facility have commenced. The company has also commissioned an additional power plant of 15 mw capacity to achieve complete selfsufficiency in meeting its power requirements.
Marketing
Moser Baer marketed a growing variety of products with a visible branding differentiation in FY04. The company continues to enjoy strong customer loyalties driven by high product quality, strict confidentiality of proprietary processes and delivery of promised standards. In-house developed, and patented, packaging variations, enabled us to offer a visibly differentiated product offering to customers. The captive Indian market, growing at over 50 per cent per annum, is one of the fastest growing markets for optical storage media in the world. During the year, the company launched its domestic brand business, under the moserbaer brand name, to capture this high growth market opportunity. In less than 12 months of operation, moserbaer brand has been able to garner a 25 per cent share of the branded segment of the domestic market.
Quality Control
Moser Baer's quality commitment remains enshrined in its Quality Policy: We are committed to Excellence and Total Customer Satisfaction through team work, Ceaseless Innovation, and Timely Delivery of Quality Products of International Standards. During the year FY04, Moser Baer continued to maintain a sharp focus on strengthening its Quality Management Systems. As a result of the various measures undertaken, the Greater Noida facility was accorded the ISO 9001:2000 Certification by DNV for the design, manufacture and supply of all formats of Optical Media and Stampers in December 2003. Moser Baer has continuously created quality products through the intelligent use of technology, committed human resources, and the extensive use of advanced statistical techniques to monitor and control prouduct quality. As a result of this we have surpassed world-class quality standards, with defect ratio for some of our products approaching six sigma levels. We moved closer to our vision to make the 'Made in India' mark respected by customers and a testimony of world-class manufacturing standard.
Technology Challenges
As a major manufacturer of optical disc products for leading global brands, Moser Baer has a broad product portfolio covering CD-R, CD-RW, DVD-R, DVD+R and DVD+RW. Apart from the CD formats that have now attained some degree of maturity, the company has to simultaneously manage very rapid format evolution, cost reduction, and volume expansion for the other formats. This is a very sensitive balancing act that often requires seemingly contradictory technical solutions. Time to market and compatibility with the installed base of writers are two of the most critical aspects governing the company's technology efforts. Close technical links that have been forged with our strategic technology partners provides us with early access to a variety of possible technical solutions. At the same time, our active participation in various International standard setting bodies and industry consortia provide us with early indications of the emerging technical benchmarks. Through the application of our rapid commercialization core competency we are able to very quickly devise an optimal solution, often with a high degree of indigenisation. The strong links that we have formed with major drive manufacturers permit us to engage them in all stages of our product development process to ensure that the new generation of drives are fully compatible with Moser Baer media. As a result, we are one of the first wave of media companies certified by one or another drive manufacturer at product launch. At the same time, we work to ensure compatibility of our new media versions with the installed base of older drives. This emphasizes the importance we place on compatibility, which we believe to be the key value proposition of blank CD and DVD. There are often enhancements that are developed within a given format or across whole format families and as a major supplier to leading global brands Moser Baer has to be at the forefront of these developments. Apart from basic disc design it has become clear by now that a major factor governing the rapid ramp up of a new format is the capability of the manufacturing platforms themselves. Moser Baer has a relatively advanced and modern manufacturing infrastructure and the internal experience and expertise permit a substantial degree of equipment improvement and customization. For example, the advanced generation DVD manufacturing equipment used by the company permitted the seamless migration to higher speed formats with their increasingly stringent specifications and decreasing tolerances. At the same time, the flexible manufacturing asset base provides the company the freedom to adjust its output to meet the blended demand profile.
At the same time as we are involved with the internal evolution of current DVD formats, the company has begun exploring the next generation, blue-laser based formats that are under development. The plan is to follow the proven path and work with selected technology partners while at the same time aim for a high degree of indigenization and customization that will bring a Moser Baer flavor to the final product and fully realize the benefits of our strengths and inherent advantages.
financial analysis
Review of operating performance: (INR in million)
Particulars Income from operations Other income Increase/(decrease) in stock of finished/semi-finished goods Total income Total expenditure Interest Depreciation Profit before taxation Provision for taxation (current) Profit after taxation Taxation (earlier year and deferred) Net Profit available for appropriation Proposed dividend Dividend distribution tax Transfer to general reserve FY04 15792.2 229.7 320.1 16342.0 8982.7 693.4 2268.9 3626.5 49.2 3577.3 338.7 3238.5 167.3 21.43 3049.8 FY03 10855.2 288.2 (957.3) 10186.1 5915.5 542.7 1174.7 2359.8 12.9 2372.7 0.0 2372.7 129.5 15.5 2227.8 36.5 29.2 38.3 36.9 60.4 51.9 27.8 93.1 53.7 281.4 50.8 YoY growth % 45.5 (20.3)
Revenue analysis
The FY04 has been a year of growth, challenges and opportunities for Moser Baer. The industry witnessed a strong demand situation and firm pricing during the first half of the year. The situation reversed in the second half with the emergence of oversupply in the system and pressure on pricing and rising costs of inputs. The European Commission (EC) dropped the antidumping inquiry against the company. However, the EC imposed an anti-subsidy on Indian exports of CDRs into Europe, which negatively impacted the company's revenue from that region. Additionally, the company changed delivery terms with few key accounts in Europe, thereby further depressing revenue growth in the last quarter of the financial year. Despite these developments, Moser Baer's revenues grew at a fast clip in FY04, driven by a near doubling of our installed capacities and fast scale up in DVD-R sales. The company has implemented its strategy to capitalize on the emerging market opportunity for DVD-R formats. The company continues to expand its competitive edge through R&D initiatives aimed at new/innovative products and efficiency improvements during the year.
Consequently, gross revenues increased from INR 10,855 millions in FY03 to INR 15,792 millions in FY04, representing a growth of 45.5 per cent.
Product pricing
The Average Selling Price (ASP) of the company is impacted by a number of factors: The ratio of sales of different formats in the overall sales mix. The type and style of packaging - CD-R and DVD-R are packaged in many different types of cases / boxes which can significantly impact the selling price. The ratio of sales to cross licensee and non-cross licensees. The company's ASP for optical media remained flat in FY04. However, the ASP declined in Q4 FY04, mainly due some pricing pressure, changes in packaging mix, a growing proportion of sales to cross licensee customers and the continued appreciation of the Indian Rupee.
Margins
EBITDA margins increased by 241 bps (basis points) over the previous years level to 41.5 per cent in FY04. The key contributors to the margin growth of the company are, 1) firm pricing environment during the year, 2) scale economies on nearly doubled capacities 3) improving production efficiencies 4) Improving product portfolio with increasing contribution from DVD-R formats 5) full benefits of backward integration projects.
Capital structure
As of March 31, 2003 the company's sharecapital was INR 484.06 million, comprising 48.4 million equity shares of INR 10 each. During the year, the company issued bonus shares to its existing shareholders in the ratio of 1:1, thereby doubling its issued and paid-up share capital. The company also implemented its maiden ESOP (employee stock option plan) of 4.4 million shares during the year. Moser Baer issued Global Depository Receipts (GDR's) equivalent to 14.7 million underlying shares to affiliates of Warburg Pincus LLC. In addition to the above, the company also issued warrants, equivalent to 5.4 million shares to affiliates of Warburg Pincus LLC. Each GDR was priced at an effective price per underlying share of INR 336. Warrants are convertible at the option of the investor into one equity share, at any time within 18 months from the date of allotment at a price of INR 336 per share. The paid-up equity capital is INR 1115.2 million as of March 31, 2004.
Reserves
Moser Baer's reserves increased 67 per cent from INR 10,994 million to INR 18,352 million in FY04, despite the capitalization during the year. This increase was primarily on account of 37 per cent rise in retained earnings and a INR 4792.2 million addition to the share premium reserve during the year from the proceeds of the GDRs. The Securities Premium Account comprised 48 per cent of the total reserves, while General Reserve comprised 52 per cent. There are no revaluation reserves as on March 31, 2004.
Loans
Over the years, Moser Baer has part funded its ongoing expansion programmes through loans raised at progressively lower costs. We have also tried to build a prudent basket of currencies to hedge against currency risks, and minimize costs. As a result, our average cost of long term debt remained at 5 per cent in FY04. Our current currency-wise total debt outstanding is as follows: Currency USD EUR INR Amount in currency 44,022,164 95,941,099 7438,801,771 Amount in INR 1924,208,808 5156,834,092 7438,801,771 % of total debt 13.25 35.52 51.23
We believe that our current total debt to equity ratio of 0.74 and interest service cover ratio of 9.2 place us in a prudent and comfortable position. The company's financial profile is characterised by high revenue growth resulting from the substantial expansion of its optical media capacity, strong operating margins and healthy debt coverage indicators.
Interest
The outflow on account of interest and finance charges increased from INR 543 million to INR 693 million in FY04, representing an increase of 27.8 per cent, primarily on account of a rise in the our overall debt levels and the scale of business.
Capital expenditure
The company invested INR 7448.7 million (USD 170 million) during FY04 at its state of the art manufacturing facilities, to meet the increased demand for optical media products from our global client base. The company intends to enhance optical media capacity from 2 billion units per annum to 2.4 billion units per annum during FY05. The incremental capital expenditure is being funded through a prudent mix of debt, equity infusion and internal accruals. Incremental investments for capacity creation are between 20-25 per cent lower than our historic costs.
A reduction in the receivables cycle: We significantly reduced receivables from 93 days of revenues in FY03 to 71 days in FY04 as against an industry benchmark of 90-120 days. Inventory: By better utilizing our information systems, and managing our stock levels, we were able to control and effectively manage inventory levels during the year. The change in commercial terms with key customers and slackness in industry environment during the last quarter of FY04, led to a marginal increase in inventory levels.
Capital employed
The total capital employed invested in the business increased from INR 23,237 million in FY03 to INR 34,513 million in FY04, representing an increase of 48.5 per cent. The company continues to generate a healthy Return on Average Capital Employed.
Surplus management
In a growing business, there were junctures when the temporary availability of resources was higher than the immediate use. These short-term surpluses were invested in low risk financial instruments that optimized returns and protected the invested principal.
Inventory valuation
Finished Goods, Work in process, Goods held for resale, Raw Materials, Packing Materials and Stores & Spares: at lower of cost and net realisable value. Cost of raw material, goods held for resale, packing materials and stores and spares, is determined on the basis of the weighted average method. Cost of work in process & finished goods, is determined by considering direct material cost and appropriate proportion of overheads .
3 Fixed Assets
Tangible fixed assets are stated at cost less accumulated depreciation. Cost includes all incidental and direct expenses. Expenses of revenue nature which can be regarded as incidental and related to project set-up are transferred to "Incidental Expenditure Pending Capitalisation". These expenses are allocated to related productive fixed assets in the year of commencement of the related project.
5 Taxation - Current
Provision is made for current income tax liability based on the applicable provisions of the Income Tax Act 1961 , for the income chargeable under the said Act and as per the applicable overseas laws relating to the foreign branch.
Deferred
The company provides for deferred tax using the net liability method based on the tax effect of timing differences resulting from recognition of items in the financial statements. The deferred tax charge or credit is recognised using the tax rates and tax laws that have been enacted or substantially enacted by the balance sheet date.
Disclosures
During the year under review, the company has not entered into any transaction of material nature with its Promoters, the Directors or the management, their subsidiaries or relatives, etc. that may have potential conflict with the interest of the company at large.
Disclaimer
Some of the statements in this report that are not historical facts are forward-looking statements. The forward-looking statements include our financial growth projections as well as statements concerning our plans, strategies, intentions and beliefs concerning our business and the markets in which we operate. These statements are based on information currently available to us, and we assume no obligation to update these statements as circumstances change. These are risks include, but uncertainties that could cause actual events to differ materially from these forward-looking statements. These risk include, but are not limited to, the level of market demand for our services, the highly-competitive market for the types of products that we offer, market conditions that could cause our customers to reduce their spending for our products, our ability to create, acquire and build new businesses and to grow our existing businesses, our ability to attract and retain qualified personnel, currency fluctuations and market conditions in India and elsewhere around the world and other risks not specifically mentioned.
risk management
Risk Management
As a company poised to take on the mantle of industry leadership, Moser Baer is exposed to various risks. Some of these risks are external and result from the business environment we operate in, while some are internal to the company. We have developed a risk reporting management process to help manage potential risks in an informed manner. We have a three-pronged risk management process.
Our comprehensive risk governance culture ensures that business decisions taken balance risk and reward. Consequently, our earnings-generating initiatives are consistent with our risk standards. Our risk-management revolves around corporate policies that outline standards and provide measurement guidelines for each risk category. The company proactively evaluates and puts in place risk-mitigation initiatives, sets prudent limits on the quantum of risk undertaken and does risk evaluation of major policy decisions. We manage the variables impacting business risk with a disciplined risk management process in keeping with established standards. The risk management strategies and processes are constantly reviewed in keeping with the changing environment. Moser Baer's risk-management mechanisms are consistent with the strategic direction of the company, desired total returns to shareholders and the credit rating of the company. Our risk appetite dictates the risk-management initiatives.
Risk environment
A number of potential risks in the current environment might make the optical media industry prospects unattractive over the coming years. These risks may stem from technology obsolescence, customer concentration risk and geographical risks amongst others. Moser Baer is, however, well poised to manage and mitigate these risks. Technology Obsolesce Risk Management The obsolescence of technology is inevitable and Moser Baer's real challenge is to anticipate and respond to both evolutionary and disruptive changes. However, many technologies may prove to be more resilient than anticipated. For example, the removable storage segment has proven to be remarkably resilient in the face of rapid technological developments with the need for broad based global compatibility being a strong stabilizing influence. The 3.5 inch floppy diskette still survives and is only now making its exit after 22 years despite being regularly confronted with far more advanced and capable storage solutions. The same solid entrenchment is observed with CD-R whereby a huge global installed base of readers and writers, estimated to far exceed 2 billion units by 2005, have served to provide the format with considerable staying power even in the face of exiting new options such as high capacity optical disc, solid state memory, broadband, and wireless delivery. The position is further strengthened by a number of compelling factors; The versatility of the CD and DVD format families has served to establish them as a bridge between the information storage and entertainment segments thereby greatly extending their utility and reach. The rapidly proliferating DVD format, the most rapidly growing Consumer Electronic (CE) product in history, not only maintains seamless backwards compatibility with CD-R and the other members of the CD family but opens up complementary new video, multi-media, and game application segments further strengthening the global mass appeal of the 120mm disc formats. The flexibility and reach of the CD and DVD formats has proven to be compelling technology enabler for a broad range of Industries spanning the Personal Computer and CE segments. These now have a vested interest in the preservation and orderly evolution of this technology infrastructure. Moser Baer expects that the above factors will prolong the decay time for CDR media beyond 2010 and that the market for DVD recordable and rewritable disc will grow to comparable levels; with global demand climbing to the level of billions of discs in the next few years. At the same time, the company has taken concrete steps to ensure that its manufacturing infrastructure and technology base are fully capable to meet the needs and requirements of the anticipated evolution in optical disc technology from CD to DVD and beyond this, to the Blue Laser/high density formats. Thus, while various new and emerging technologies have the potential to compete technologically with CD and DVD, we believe that significant barriers are in place to prevent, or at least slow down, the displacement and eventual obsolescence of these formats. These include: Hundreds of millions of satisfied, cost conscious users and an estimated global installed infrastructure base of over 1.5 billion compatible hardware devices. The latest projections suggest that even as far out as 2010 almost 80 per cent of the installed base of optical disc writers will be CD-R compatible. A broad coalition made up of almost all major global PC/CE companies and content providers into whose business models CD/DVD products and applications have been integrated and who must gain from any transition. Billions of dollars invested in CD/DVD hardware and disc manufacturing capacity and the need for similar infrastructure investments for alternative technologies.
Ability to rapidly commercialise new products: The internal R&D resources have been steadily expanded and strengthened and today cover the spectrum from CD to DVD (prerecorded, recordable and rewritable). Numerous internal innovations have resulted in a product leadership position for Moser Baer in CD-R and we are rapidly extending this to other formats. The newly commissioned state-of-the art mastering facility will round off Moser Baer's technology platform and equip the company with resource base required for the next decade. In fact, preliminary R&D efforts in Blue laser based formats (expected to reach the mass market in the 2005/2006 timeframe) have begun. Access to new technology Through long standing strategic partnerships and working projects with key technology providers, including many of the leading global companies at the forefront of new format development, we have unfettered access to cutting edge technology and process know-how. Drive/media compability Today, by virtue of being recognized as one of the major suppliers of optical media to the global markets, Moser Baer has forged excellent cooperative links with all major hardware suppliers. They commonly utilize our media in their product development activities and regularly provide Moser Baer with pre-production samples to ensure seamless compatibility. In addition, Moser Baer's blue-chip customer base provides an additional level of product compatibility assurance. Evolutionary capabilities of manufacturing infrastructure By virtue of its relatively late expansion, Moser Baer is in the unique position of possessing a very high proportion of advanced, 3rd generation, multi-format capable manufacturing platforms. These will provide us a seamless pathway to future proof its capital investments and more importantly, to tailor its operations to provide an optimal, evolutionary product mix.
As a de-risking measure, we have reduced our exposure to European customers, to minimize the impact of protectionist measures the EC may undertake in the future. People Risk Management High quality human resources are vital to the success of our business. Being in a highly competitive & technology advanced environment, retaining talent is always the primary focus for HR. During the year our attrition was well within the manageable limit. However, in order to retain the talent our company has been promoting the sense of ownership and pride in association by way of several HR initiatives. Various initiatives like Long Associate Awards, ESOPs, employee friendly policies etc have helped us in keeping the attrition rate well in control & below the industry average. The company has worked towards providing challenging high growth environment for its employees. We have continuously benchmarked ourselves to improve our HR policies and practices. Competition De-risking As installed capacities in global data storage industry have risen, prices have sharply declined. Moser Baer has responded to price-based competition with an unbeatable price-value proposition superior quality, timely delivery, attractive price and regular introduction of new products. The success of this approach is reflected in the company's increasing global share and high growth. Cash Flow Risk Efficient cash flow management imperitive to grow. The company operates in a high growth and capital intensive industry. Hence it is imperative to efficiently estimate and manage cash flows in this volatile environment. The company's working capital arrangements are well in place to guard against any uneven or seasonal factors. Besides, the company has also tied up additional alternative financing for cost optimization / funding the operations. The company monitors liquidity on a daily basis. Besides liquidity needs are estimated over a 12 month period on a rolling basis and compared with amount of available liquidity for management thereof. Security Risk Management Operations could be disrupted due to natural, political and economic disturbances. As a part of its Disaster Recovery Plan, all related risks have been mapped by the company. A Disaster Management Team has been entrusted with mobilization of resources and asset safety during emergencies.
Creating Value
Economic Value Added (EVA) EVA analysis starts with the premise that investors are primarily concerned with the cash return on their cash investment and the risk associated with that investment. This return can be directly compared with the return expected by investors, the company's WACC. Value is created/destroyed if the business generates a return above/below its cost of capital. EVA is thus defined as: EVA = (ROIC - WACC) x Capital Risk-free return (R f ) We have used the yield on the 10-year government bond as the risk-free rate. This bond currently yields 6.0% per annum, having come off the levels in FY03. Equity beta ( e ) Based on an analysis of comparable optical storage media companies in Asia as well as Moser Baer's beta estimate from Bloomberg, Moser Baer's adjusted equity beta is estimated to be 0.94 for FY03-04. Market risk premium (MRP) The MRP is the additional return over and above the risk-free return investors require to invest in the market portfolio. We estimate the MRP to be 6.0%.
os
Ratio Analysis
Ratio analysis Year ended March 31 Financial performance ratios Export revenue/total revenue (%) Gross profit/total revenue (%) Selling, general & administrative expenses/total revenue (%) Employee cost/total revenue (%) Operating profit/total revenue (%) Tax/PBT (%) ROCE (EBIT/average capital emploed) (%) 82.2% 53.0 11.1 3.3 41.0 1.4 16.0 85.0% 47.9 13.2 3.0 38.6 -0.6 16.8 81.2% 58.2 11.8 2.7 42.8 1.9 21.4 84.7% 62.0 8.1 2.6 48.5 0.0 24.4 84.6% 46.4 7.9 3.3 36.5 0.0 12.7 2004 2003 2002 2001 2000
Balanced sheet ratios Average debt-equity ratio (%) Debtors turnover days Inventory turnover days Creditors turnover days 66.0 70.7 45.9 64.7 85.2 93.4 33.6 55.9 64.3 139.7 128.8 58.6 46.3 147.8 188.0 66.9 91.5 98.9 143.4 58.9
Growth ratios Sales value (%) Export revenue growth (%) Operating profit (%) Net earnings (%) 45.5 34.3 61.6 36.5 59.5 57.6 26.1 10.0 102.5 88.7 66.5 55.7 117.1 128.8 219.8 214.1 52.8 64.0 75.1 115.9
Per share data Earnings per share (INR) Fully diluted earnings per share (INR) Cash earnings per share (INR) Dividend per share (INR) Book value per share (INR) Price/earnings (x) Price/cash earnings (x) Price/book value (x) 36.8 33.5 50.5 1.5 176.2 8.3 6.1 1.7 24.4 24.4 37.8 2.5 120.0 4.7 6.0 1.9 22.3 22.3 29.1 2.6 95.2 5.7 8.7 2.6 15.4 14.9 26.9 3.1 107.3 7.4 8.4 2.1 7.1 7.1 8.5 1.7 30.0 11.5 13.1 3.3
directors' report
Dear Shareholders, Your Directors are pleased to present the 21st Annual Report and Audited Accounts for the financial year ended 31st March, 2004.
Financial Results
(INR in Million) Year ended March 31, 2004 GROSS SALES AND OTHER INCOME PROFIT BEFORE DEPRECIATION & INTEREST DEPRECIATION INTEREST AND FINANCE CHARGES PROFIT BEFORE TAX PROVISION FOR TAXATION (inc. Deferred Tax) PROFIT AFTER TAX PROFIT AVAILABLE FOR APPROPRIATION APPROPRIATIONS: DIVIDEND (PROPOSED) PROVISION FOR TAX ON PROPOSED DIVIDEND TRANSFER TO GENERAL RESERVE 167.27 21.43 3,047.80 129.45 15.51 2,227.77 16,021.86 6,588.71 2,268.87 693.37 3,626.47 387.96 3,238.51 3,238.51 2003 11,143.38 4,077.27 1,174.69 542.74 2,359.84 (12.89) 2,372.73 2,372.73
Operations
Revenues grew 43.8 per cent to INR 16.02 billion, EBIDTA (Earnings Before Interest Depreciation and Tax) grew 61.6 per cent to INR 6.59 billion, and Profit After Tax grew 36.5 per cent to INR 3.24 billion. The market environment during the year was strong, with significant growth in all areas of the optical media market. 2003 was the first year of mass market adoption of the DVD-R format, with global demand growing 3 times over 2002. During the year, your company firmly established itself in this important and rapidly growing segment, which will be the main engine of growth for the company over the next 2-3 years. The company rapidly expanded its capacities at its Greater Noida Complex, further reinforcing it's position as the single largest Optical Disk production site in the world.
Market Environment
The market environment substantially improved during the second half of the financial year, which was reflected by significantly reduced inventories, improving prices, and strong demand. Key highlights for the financial year are: Revenues of INR.16,021.86 million Cash profits (Earnings before Depreciation and Taxes)- INR.5,507.38 Million. Profit After tax of INR.3,238.51 million Earnings per share of INR.33.41 (After prior period items) Significant working capital reductions, due to improved market conditions and benefits from use of technology. Working Capital (INR in million) Particulars Debtors Days Inventory Days Creditors Days FY01 1,361.0 145.8 1,731.4 185.5 615.8 65.9 FY02 2,604.4 137.8 2,402.4 127.1 1,093.3 57.8 FY03 2,778.0 93.4 998.5 33.5 1,724.9 58.0 FY04 3,059.9 70.7 1,984.9 45.9 2,307.8 53.3
Significant increases in capacity at the Greater Noida complex. Your company started production of 8x DVD-R's and 4x DVD-RW's. Working Capital has been one of the key focus areas for the company during the year. Consequently, Net Working Capital as a percentage of gross revenues stands at 19.8 per cent.
Market Development
Moser Baer marketed a growing variety of products with a visible branding differentiation in FY03-04. Your company continues to enjoy strong customer loyalties driven by high product quality, product and process innovation and delivery of promised standards. In-house developed and patented packaging variations enabled us to offer a visibly differentiated product offering to customers. The captive Indian market, expected to grow at a CAGR of over 40 per cent over the next 3 years, is one of the fastest growing markets for optical storage media in the world. During the year, your company promoted its domestic brand business, under the moserbaer brand name, to capture this high growth market opportunity and the moserbaer brand has been able to capture an estimated 25 per cent share of the branded segment of the domestic market. The company's retail strategy has been extremely successful, with the moserbaer brand being associated with quality and innovation, and widely distributed across over 10,000 retail outlets in 32 cities in the country.
Your company has now embarked on the next phase of expansion, in line with our aim of capturing a higher market share of the fast growing global optical storage media industry. We will do this by leveraging our low-cost advantage and world-class infrastructure and technology. This project is expected to commence production by the end of FY04-05. Your company's subsidiary - European Optic Media Technology GmbH (Europtic) will provide a strategic thrust to the global marketing position of Moser Baer. In addition to the benefits of close proximity to customers, Europtic will work closely with various technology companies to develop very high value added and customized products for niche market segments.
Subsidiary Company
The company has incorporated a subsidiary company in Germany viz., European Optic Media Technology GmbH (hereinafter referred to as- Europtic) to expand its area of operations to Europe. The annexed accounts pertain for the period January, 2003 to March, 2004. As required under Section 212 of the Companies Act, 1956, the Balance Sheet, P & L Account and the Directors' Report on the affairs of Europtic are annexed herewith together with the statement of the said subsidiary company. Also, the German law does not regulate any audit duties for its financial statements as the provisions of Code of Commercial Law of Germany are not attracted for the said duration. Accordingly, Auditors' Report has not been prepared for the said period. During the year under review, the company has divested its investment in Glyphics Media Inc, realizing the full value of its initial investment. However, the accounts of Glyphics Media Inc till 30th August, 2003 have been included while preparing the consolidated accounts of your company.
Associate Company
During the year under review, your company and Imation Corp have entered into a 49:51 joint venture and established a company - Global Data Media FZ LLC in Dubai for marketing and distribution and research and development of the company's products.
Dividend
Your Directors are pleased to recommend dividend @ 15 per cent on the paid-up Equity Share Capital of the company for FY03-04. The total pay-out will be INR 188.70 million inclusive of dividend tax and surcharge thereon.
Directors
In terms of the provisions of Sections 255 and 256 of the Companies Act, 1956 and Articles of Association of the company, Mr. Ratul Puri, Executive Director and Mr. Harnam Dass Wahi, Director retire at the ensuing Annual General Meeting and, being eligible, have offered themselves for reappointment.
Auditors
The term of M/s. K. C. Khanna & Co., Chartered Accountants is due to expire at the forthcoming Annual General Meeting. Pursuant to a resolution of the Board of Directors of the company, it has been resolved that, subject to the approval of the members in a general meeting by Special Resolution, M/s. Price Waterhouse, Chartered Accountants, be appointed as Statutory Auditors of the company, in their place and M/s. Price Waterhouse shall hold office from the conclusion of the 21st Annual General
Meeting until the conclusion of the 22nd Annual General Meeting of the company.
The fair value of each option has been estimated on the date of the grant of the options using the Black Scholes (Enhanced Model) with the following assumptions:Stock Price Exercise Price Total life of the options Vesting period Exit rate (pre-vesting) Exit rate (post-vesting) Exercise multiple INR 351 (as on 9th January 2004 as per NSE data) INR 342 - Market price. 7 years 3 years NIL 3 per cent p.a. 1.25x (assuming that employees would exercise the options vested with them once the multiple, i.e. Market Price over Exercise Price reaches 1.25x) 4.21per cent (for 6 years, source-Reuters as on 9th January 2004) 70 per cent (based on 4 year stock data from NSE) 1 per cent (based on the dividend history of past 3 financial years, with a weighted of 50 per cent, 30per cent and 20 per cent for financial year ending '03, financial year ending '02 and financial year ending '01)
Risk free rate Expected Volatility p.a. Expected Dividend Yield p.a.
*Thus the fair value of the options comes to INR 188 per option. Total value of the options = 2,030,300 x INR 188 = INR 381,696,400 Amortisation = INR 127,232,133.
Bonus Shares
At the Annual General Meeting of the company held on 21st October, 2003, you had approved capitalization of reserves of the Company to issue Bonus Shares in the ratio of 1:1 to then existing Equity Shareholders of the company. On 18th December, 2003, 48,406,472 Equity Shares of INR 10 each were issued to those persons who were members/beneficial owners of the shares of the company as on 28th November, 2003.
Countervailing Duty
The European Commission announced the termination of its anti-dumping proceedings against your company with respect to the manufacturing of Recordable Compact Discs (CD-R) as its investigations did not reveal any evidence of dumping by your company. Thus, no anti-dumping duty was imposed with respect to the manufacturing of CD-Rs. However, the European Commission has imposed a 7.3 per cent countervailing duty on the value of imports of CD-Rs originating in India. The duty is paid by importers of CD-R media in Europe, and does not affect any of the company's other products like CD-R/W, DVD-R & DVD-R/W.
Particulars of Employees
Particulars of employees as required under Section 217(2A) of the Companies Act, 1956 read with the companies (Particulars of Employees) Rules, 1975, as amended, form part of this report. However, in pursuance of Section 219(1)(b)(iv) of the companies Act, 1956, this report is being sent to all the shareholders of the company excluding the aforesaid information and the said particulars are made available at the Registered Office of the company. The members interested in obtaining such particulars may write to the Company Secretary at the Regd. Office of the company.
Conservation of Energy, Research and Development, Technology Absorption, Foreign Exchange Earnings and Outgo
The information pertaining to conservation of energy, research & development, technology absorption, foreign exchange earnings and outgo, as required under Section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of particulars in the report of the Board of Directors) Rules, 1988 is given as per Annexure and forms part of Directors' Report.
Fixed Deposits
During the year under review, the company has not accepted any deposit under Section 58A of the Companies Act, 1956 read with Companies (Acceptance of Deposits) Rules, 1975.
Corporate Governance
A report on Corporate Governance along with a certificate from the Statutory Auditors has been included in the Annual Report detailing the compliances of corporate governance norms as enumerated in Clause 49 of the Listing Agreements with the Stock Exchanges.
Conclusion
Your company continues to consolidate its leadership position in its business through value addition to its products and services. It is also progressively gaining international competitiveness in quality and cost benchmarks and aims to build shareholder value and sustain its performance track record. Your Directors look forward to the future with confidence. Your Directors place on record their appreciation for the overwhelming co-operation and assistance received from investors, customers, business associates, bankers, vendors, regulatory and governmental authorities. Your Directors also thank the employees at all levels, who through their dedication, co-operation, support and smart work have enabled the company to achieve rapid growth.
For and on behalf of the Board of Directors of MoserBaer India Limited Place : New Delhi Date :29th June, 2004 Sd/Deepak Puri Chairman & Managing Director
annexure A
Information regarding the Employee Stock Option Scheme
(as on 31-03-2004) a) Number of Stock Options granted b) Pricing formula 2,030,000 numbers The average of the two weeks' high and low price of the share prior to the date of grant of options as quoted at National Stock Exchange, rounded-off to the nearest Rupee. Nil Nil Nil Nil Nil Nil 2,030,000 numbers No. of options
c) Number of Options vested d) Number of Options exercised e) Number of shares arising as a result of exercise of options f) Number of Options lapsed
g) Variance of terms of options h) Money realized by exercise of options i) j) Number of options in force Employee wise details of options granted to (i) Senior managerial personnel a) Mr P M Pai, President b) Mr V J Prakash, MD-European Operations c) Mr Brian J, VP - Strategic Initiatives d) Mr M Kobayashi, VP - Japan Operations e) Mr Rakesh Govil, Head - Corp Strategy & Treasury
(ii) Employees who were granted options amounting to 5 per cent or more of the options granted during the year Mr P M Pai, President Mr. Brian J, VP - Strategic Initiatives Mr. Rakesh Govil, Head - Corp Strategy & Treasury (iii) Employees who were granted options in any one year equal to or exceeding 1 per cent of the issued capital of the company. k) Diluted Earnings Per Share (EPS) pursuant to issue of shares on exercise of options calculated in accordance with International Accounting Standard (IAS) 33 l) Weighted average exercise price of the options
NIL
Not Applicable (as no option has been exercised so far) Not Applicable (as no option has been exercised so far) Not Applicable (as no option has been exercised so far)
m) Weighted average fair value of the options n) A description of the method and significant assumptions used during the year to estimate the fair value of options, including the following weighted average information:-
(i) risk free interest rate (ii) expected life (iii) expected volatility (iv) expected dividends
4.21per cent (for 6 years, source-Reuters as on 09/01/2004) 7 years 70 per cent (based on 4 year stock data from NSE) 1per cent (based on the dividend history of past 3 financial years, with a weighted of 50 per cent,30 per cent and 20 per cent for financial year ending '03, financial year ending '02 and financial year ending '01) INR 342 per share
(v) the price of the underlying share in market at the time of option grant
annexure B
Information as per Section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 and forming part of the Directors' Report for the year ended 31st March, 2004. A. Conservation of energy:
Your company's energy requirements continue to develop significantly as it commissioned new manufacturing facilities and as it increased production at its existing facilities. The company undertook a number of measures during the year to reduce the energy consumption including:1. Commissioning of steam based vapour absorption systems, which effectively recycle exhaust gases from the company's power plants. 2. The company developed a new production process which had process windows far wider than its earlier process enabling reduction in the level of conditioning needed in the coating areas and thereby further reducing energy consumption. 3. The company is working on a number of energy reduction projects, the estimated investments in these projects amount to approx. INR 15 million and should result in energy savings in the region of INR 8 - 10 million each year.
II. RESEARCH & DEVELOPMENT 1. Specific areas in which R&D carried out by the company (a) Development of high speed CD-R 52X process using alternate dye technologies resulting in significant reduction in cost per CD-R. (b) Development of 4X, 8X DVD-R and 4X DVD+RW processes to keep pace with technology and market trends. (c) Improvement in existing processes to achieve significant improvement in archival life of products. (d) Establishment of highly advanced state of the art Mastering and Galvanics facility. This has further improved our overall cost of operation. 2. Future Plan of Action (a) To develop 16X DVD-R, 8X DVD+RW and dual layer DVD+R products. (b) To work on development of future formats like HD DVD and Blue-ray discs. 3. Expenditure incurred on R&D during FY 03-04:(a) Capital Expenditure: INR 126 Million
(b) Recurring Expenditure: INR 180 Million (c) Total Expenditure: INR 306 Million
For and on behalf of the Board of Directors of MoserBaer India Limited Place : New Delhi Date :29th June, 2004 Sd/Deepak Puri Chairman & Managing Director
corporate governance
1. COMPANY'S PHILOSOPHY ON CORPORATE GOVERNANCE
Moser Baer India Limited is committed to adhere to the code of corporate governance as it means adoption of best business practices aimed at growth of the company coupled with bringing benefits to investors, customers, creditors, employees and the society at large.
2. BOARD OF DIRECTORS
The present strength of the Board is Nine Directors. The Board comprises of three Executive Directors and six Non-Executive Independent Directors. The Non-Executive Directors bring independent judgement in the Board's deliberations and decisions. COMPOSITION OF THE BOARD
Name of the Director Category Equity Investors represented
Mr. Deepak Puri* Mr. Harnam D. Wahi Mr. Arun Bharat Ram Mrs. Nita Puri Mr. John Levack Mr. Rajesh Khanna
Executive Independent and Non-Executive Independent and Non-Executive Executive Independent and Non-Executive Independent and Non-Executive
N.A. N.A. N.A. N.A. Electra Partners Mauritius Limited. Bloom Investments Limited (BIL), Ealing Investments Limited (EIL), Randall Investments Limited (RIL) and Woodgreen Investment Ltd (WIL). BIL, EIL, RIL and WIL are affiliates of Warburg Pincus LLC. N.A. N.A. N.A.
*During the year FY03-04, Mr. Rakesh Govil was appointed as an Alternate Director to Mr. Deepak Puri. However, he ceased to be the Alternate Director w.e.f. 16th January, 2004.
DIRECTORSHIP IN OTHER COMPANIES AND BOARD COMMITTEES: None of the Directors of the Board serve as members of more than 10 Committees nor are they Chairman of more than 5 Committees, as per the requirements of the Listing Agreement.
Name of the Director No. of other Directorships (excluding foreign companies and private limited companies) Chairman Member No. of Committee Memberships (including MBIL's Committees)
Mr. Deepak Puri Mr. Harnam D. Wahi* Mr. Arun Bharat Ram Mrs. Nita Puri Mr. John Levack Mr. Rajesh Khanna Mr. Prakash Karnik Mr. Bernard Gallus Mr. Ratul Puri
1 1 10 1 4 2 -------
--3 ---------------
2 --5 1 5 2 3 --1
*Mr. Harnam D. Wahi has notified the company that he has ceased to be a Director in DCM Shriram Consolidated Limited w.e.f. 18th August, 2003. The Board met seven times on the following dates during the financial year 2003-2004 and the gap between two meetings did not exceed four months: (i) 23 April, 2003 (iv) 20th September, 2003 th (vii) 27 January, 2004
rd
th
th
The information as required under Annexure I to Clause 49 of the Listing Agreement is made available to the Board. Adequate information is circulated as part of the agenda papers to enable the Board to take informed decisions. ATTENDANCE RECORD OF DIRECTORS:
Name of the Director Board Meetings held during the year Meetings attended Attended last AGM held on October 21, 2003 In Person Through Audio Conferencing
Mr. Deepak Puri Mr. Harnam D. Wahi Mr. Arun Bharat Ram Mrs. Nita Puri Mr. John Levack Mr. Rajesh Khanna Mr. Prakash Karnik Mr. Bernard Gallus Mr. Ratul Puri Mr. Rakesh GovilAlternate Director to Mr. Deepak Puri
7 7 7 7 7 7 7 7 7
4 7 2 3 4 4 6 Leave of absence 7
---
N.A.
3. AUDIT COMMITTEE
The company has a qualified and independent Audit Committee. Mr Harnam D. Wahi is the Chairman of the Audit Committee. Other members of the Committee are- Mr. Prakash Karnik, Mr. Rajesh Khanna and Mr. John Levack. The Company Secretary of the company acts as the Secretary of the Committee. Terms of reference:The Audit Committee performs the following functions:a) Overseeing the company's financial reporting process and the disclosure of financial information to ensure that the financial statement is correct, sufficient and credible. b) Recommending the appointment and removal of external auditors, fixation of audit fee and also approval for payment for any other service. c) Reviewing with management the annual financial statements before submission to the Board, focusing primarily on; Any changes in accounting policies and practices. Major accounting entries based on exercise of judgement by management. Qualifications in draft audit report. Significant adjustments arising out of audit. The going concern assumption. Compliance with accounting standards. Compliance with stock exchange and legal requirements concerning financial statements. Any related party transactions i.e. transactions of the company of material nature, with promoters or the management, their subsidiaries or relatives etc. that may have potential conflict with the interests of company at large. d) Reviewing with the management, external and internal auditors, the adequacy of internal control systems. e) 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. f) Discussing with internal auditors any significant findings and follow up thereon.
g) 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. h) Discussing with external auditors before the audit commences- nature and scope of audit as well as have post-audit discussion to ascertain any area of concern. i) j) Reviewing the company's financial and risk management policies. Looking into the reasons for substantial defaults in the payment to the depositors, debenture holders, shareholders (in case of non-payment of declared dividends) and creditors, if any.
During the year, the Committee met seven times on the following dates: (i) 23rd April, 2003 (iv) 5th August, 2003 th (vii) 27 January, 2004 (ii) 29th July, 2003 (v) 20th September, 2003 (iii) 30th July, 2003 (vi) 24th October, 2003
Following are the details regarding the Committee meetings attended by the members:Member Director Committee Meetings held during the year In Person Through Audio Conferencing Meetings Attended
Mr. Harnam D. Wahi (Chairman) Mr. Prakash Karnik Mr. Rajesh Khanna Mr. John Levack Mr. Ratul Puri *
7 7 7 7 7
7 7 5 4 7
th
----2 ---
* Mr. Ratul Puri resigned from the membership of the Audit Committee with effect from 25 March, 2004.
4. COMPENSATION COMMITTEE
Mr Harnam D. Wahi is the Chairman of the Compensation Committee. Other members of the Committee are - Mr. Prakash Karnik, Mr. John Levack and Mr. Rajesh Khanna. The Company Secretary of the company acts as the Secretary of the committee. Terms of reference:The company's compensation policy is based on the principles of responsibility, performance and potential. The company's Compensation Committee has been constituted to administer the Employees Stock Option Plan and to decide about the remuneration package of all the Executive Directors of the company. During the year, the Committee met four times on the following dates: (i) 23rd April, 2003 (iv) 11th January, 2004 (ii) 29th July, 2003 (iii) 24th October, 2003
Following are the details regarding the Committee meetings attended by the members:Member Director Committee Meetings held during the year No. of Meetings Attended
Mr. Harnam D. Wahi (Chairman) Mr. Prakash Karnik Mr. Rajesh Khanna Mr. John Levack Mr. Deepak Puri * Mr. Rakesh GovilAlternate Director to Mr. Deepak Puri
4 4 4 4 4
4 2 3 2 3
* Mr. Deepak Puri resigned from the membership of the Compensation Committee with effect from 25th March, 2004.
REMUNERATION POLICY (i) Executive Directors:The details of the remuneration paid to Mr. Deepak Puri, Managing Director, Mrs. Nita Puri, Whole Time Director and Mr. Ratul Puri, Executive Director during the year FY03-04 are as follows:
Particulars Managing Director Whole Time Director Executive Director
The company has executed a Service Contract each with Mr. Deepak Puri, Managing Director, Mrs. Nita Puri, Whole Time Director and Mr. Ratul Puri, Executive Director whereby each of them has been appointed for a period of five years w.e.f. 1st September, 2001, 1st December, 2001 and 1st October, 2001 respectively. Each of them is entitled to resign from his/her office at any time upon giving to the company at least three calendar months' written notice. No severance fees shall be payable to either of them. (ii) Non-Executive Directors:The Non-Executive Directors have not drawn any remuneration from the company for the year ended March 31, 2004. However, they were paid a sitting fee of Rs.5,000 for each Board/Committee meeting attended till 21st October, 2003 and Rs.20,000 for each Board Meeting and Rs.10,000 for each Committee meeting attended thereafter. Mr. Rajesh Khanna, nominee Director of BIL, EIL, RIL and WIL does not charge any Sitting Fees for attending any meeting of the Board or Committees thereof. Service Contracts, Notice Period, Severance Fees Mr. Harnam D. Wahi, Mr. Arun Bharat Ram, Mr. Bernard Gallus and Mr. Prakash Karnik are liable to retire by rotation. No severance fees will become payable to them if they desire not to continue as Directors of the company. Mr. John Levack non-rotational nominee Director- representative of Electra Partners Mauritius Ltd.: - No severance fees will become payable to him if Electra Partners Mauritius Ltd. withdraws his nomination as a Director of the company. Mr. Rajesh Khanna non-rotational nominee Director-representative of BIL, EIL, RIL and WIL - affiliates of Warburg Pincus LLC.: No severance fees will become payable to him if BIL, EIL, RIL and WIL withdraw his nomination as a Director of the company.
Following are the details regarding the Committee meetings attended by the members:Names of members Committee Meetings held during the year No. of Meetings Attended
Mr. Harnam D. Wahi (Chairman) Mr. Prakash Karnik Mr. John Levack Mr. Deepak Puri Mrs. Nita Puri
4 4 4 4 4
4 3 3 3 2
Name and designation of the Compliance Officer:- Mrs. Minni Katariya, Company Secretary. The transfer / transmission of physical share certificates is approved by the Company Secretary generally on a weekly basis on the basis of recommendations received from the company's Registrars and Share Transfer Agent-M/s. MCS Limited. The investors may lodge their grievances through e-mail at shares@moserbaer.net or contact the Compliance Officer at the following numbers: Telephone numbers : 51635201-5, 26911570-74 Fax number : 51635211, 26911860
Information regarding complaints received from the shareholders Complaints received and processed by M/s. MCS Limited and the Company from 1st April, 2003 to 31st March, 2004
Nature of complaints Received Disposed off Pending
Relating to transfer, transmission, etc. Relating to dematerialization Relating to dividend Relating to miscellaneous matters Relating to bonus TOTAL
19 1 3 15 17 55
19 1 3 15 17 55
-------------
SEBI / DSE/ BSE Complaints status from 1st April, 2003 to 31st March, 2004
Nature of complaints Received Disposed off Pending
Relating to transfer, transmission, etc. Relating to dematerialization Relating to dividend Relating to miscellaneous matters Relating to bonus TOTAL
28 --18 --12 58
28 --18 --12 58
-------------
Following are the details regarding the Committee meetings attended by the members:Names of members Committee Meetings held during the year No. of Meetings Attended
Mr. Rajesh Khanna (Chairman) Mr. Prakash Karnik Mr. John Levack Mr. Deepak Puri
3 3 3 3
2 2 2 1
Tuesday, 01/04/2003 to Thursday, 24/04/2003 Wednesday, 09/07/2003 to Wednesday, 30/07/2003 Wednesday, 17/09/2003 to Monday, 22/09/2003 Tuesday, 07/10/2003 to Saturday, 25/10/2003 Thursday, 01/01/2004 to Saturday, 31/01/2004 Thursday, 01/04/2004 to Friday, 30/04/2004
Consideration of un-audited financial results for the quarter ended 31st March, 2003. Consideration of un-audited financial results for the quarter ended 30th June, 2003. Consideration of audited annual accounts of the Company for the year 2002-03. Consideration of un-audited financial results for the quarter ended 30th September, 2003. Consideration of un-audited financial results for the quarter ended 31st December, 2003. Consideration of un-audited financial results for the quarter ended 31st March, 2003.
8. PARTICULARS OF ANNUAL GENERAL MEETINGS AND EXTRAORDINARY GENERAL MEETINGS HELD DURING THE LAST THREE YEARS
General Meeting Date Time Venue Special Resolutions passed
For shifting of statutory registers, records, documents, etc of the company from its registered office to its corporate office. Nil (a) For getting the Equity Shares of the company de-listed from the Stock Exchanges located at Delhi, Kolkata, Ahmedabad and Kanpur. (b) For alteration of the Article 6 of the Articles of Association of the company. (c) For alteration of the Article 5(a) of the Articles of Association of the company. (d) For shifting of statutory registers, records, documents, books of accounts, etc of the company from its corporate office to its registered office. (e) For issue of Equity Shares under SEBI (ESOS and ESPS) Guidelines, 1999 to the employees of the company. (f) For issue of Equity Shares under SEBI (ESOS and ESPS) Guidelines, 1999 to the employees of subsidiary companies of the company.
Centaur Hotel, New Delhi- 110 037 Centaur Hotel, New Delhi- 110 037
FICCI Golden Jubilee (a) For alteration of the Article 94 of the Auditorium, Articles of Association of the Federation House, company. Tansen Marg, New Delhi- 110 001 (b) For capitalisation of reserves of the company for issuing Bonus Shares. Centaur Hotel, New Delhi- 110 037 (a) For alteration of the Article 5(a) of the Articles of Association of the company. (b) For increasing the number of Equity Shares to be issued under SEBI (ESOS and ESPS) Guidelines, 1999 to the employees of the company.
(c) For increasing the number of Equity Shares to be issued under SEBI (ESOS and ESPS) Guidelines, 1999 to the employees of subsidiary Companies of the Company. (d) For issue and allotment of ADRs/GDRs on a preferential basis to various Institutional Investors. (e) For issue and allotment of Equity Shares on a preferential basis to Woodgreen Investment Ltd or any other affiliates of Warburg Pincus LLC. (f) For issue and allotment of Warrants convertible into Equity Shares on a preferential basis to Woodgreen Investment Ltd or any other affiliates of Warburg Pincus LLC. (g) For increasing the shareholding limit for FIIs in the Company to 74%. Further, no resolution was required to be put through postal ballot at the last Annual General Meeting. No resolution is proposed to be passed through postal ballot at the forthcoming Annual General Meeting.
9. DISCLOSURES
a) Disclosures on materially significant related party transactions, i.e. transactions of the company of material nature, with its Promoters, the Directors or the management, their subsidiaries or relatives, etc. that may have potential conflict with the interest of the company at large - NIL. b) Details of non-compliance by the company, penalties, strictures imposed by Stock Exchange or SEBI or any statutory authority, on any matter related to capital markets, during the last three years- NIL
10.MEANS OF COMMUNICATION
a) The company ensures that its financial results are sent to the concerned Stock Exchanges immediately after the same have been considered and taken on record by the Board of Directors and published in the following newspapers:(i) The Economic Times. (ii) The Times of India. (iii) The Hindustan Times. (iv) The Pioneer. (v) Navbharat Times. (vi) Business Standard. (vii) Financial Express. b) The company also ensures that these results are promptly and prominently displayed on the company's website:www.moserbaer.com
c) The company also complies with SEBI regulations regarding filing of its financial results under the EDIFAR system. d) The company's official news releases are also displayed on the company's web site. e) Management Discussion and Analysis Report is a part of the Annual Report of the company for the year FY03-04.
* During the year 2003-04, the equity shares of the company were voluntarily delisted by the company from The Ahmedabad Stock Exchange, The Delhi Stock Exchange and The Uttar Pradesh Stock Exchange. Further, the company has filed an application with The Calcutta Stock Exchange for voluntary delisting. Application for the same is under process and approval is pending. f) STOCK CODE The Stock Code at: i) Mumbai Stock Exchange is ii) National Stock Exchange is iii) Calcutta Stock Exchange is : : : 517140 MOSERBAER 23164 and 10023164
g) STOCK PRICE DATA Stock Market Data at BSE and NSE for the period 1 April, 2003 to 31 March, 2004 Monthly high and low quotations of shares traded at the Stock Exchange, Mumbai (BSE) and National Stock Exchange Ltd. (NSE) are as follows: MONTHS Highest BSE Lowest Highest NSE Lowest
st st
April, 2003 May, 2003 June, 2003 July, 2003 August, 2003 September, 2003 October, 2003 November, 2003 December, 2003 January, 2004 February, 2004 March, 2004
284.50 306.90 345.00 375.00 333.00 418.75 512.80 598.00 362.70 421.00 360.00 332.90
227.50 266.05 284.00 305.00 244.95 277.30 372.50 281.00 278.25 311.15 306.00 234.00
284.90 330.00 345.00 380.00 321.50 417.45 513.00 598.00 362.20 419.00 360.00 333.00
225.25 230.00 248.00 305.00 253.20 271.60 351.15 281.50 242.00 311.00 306.00 233.20
g) i)
N S E Nif ty
h) ADJUSTED STOCK PRICE DATA:- Calculated after taking into consideration the issue of Bonus Shares in the ratio of 1:1 (the th th record date being - 28 November, 2003 and the date of allotment being - 18 December, 2003).
MONTHS Highest BSE Lowest Highest NSE Lowest
April, 2003 May, 2003 June, 2003 July, 2003 August, 2003 September, 2003 October, 2003 November, 2003 December, 2003 January, 2004 February, 2004 March, 2004 h) i)
142.25 153.45 172.50 187.50 166.50 209.38 256.40 299.00 362.70 421.00 360.00 332.90
113.75 133.03 142.00 152.50 122.48 138.65 186.25 140.50 278.25 311.15 306.00 234.00
142.45 165.00 172.50 190.00 160.75 208.73 256.50 299.00 362.20 419.00 360.00 333.00
112.63 115.00 124.00 152.50 126.60 135.80 175.58 140.75 242.00 311.00 306.00 233.20
300.00
140.00
N S E Nifty
i)
Upto 5,000 5,001 to 10,000 10,001 to 20,000 20,001 to 30,000 30,001 to 40,000 40,001 to 50,000 50,001 to 100,000 100,001 & above Total
j)
MCS Limited is the Registrar & Share Transfer Agent of the company and its office is located at W-40, Okhla Industrial Area, Phase-II, New Delhi 110 020. Contact Person: - Mr. K.R.Menon. Contact numbers are as follows: Phone numbers Fax number E-mail address : : : 26384909-11 and 51609386 26384907 mcsdel@vsnl.com
k) SHARE TRANSFER SYSTEM The application for transfer, transmission and transposition of shares are received by the company at its registered office or at the office of Registrars and Share Transfer Agent- M/s. MCS Limited. Following is the procedure of transfer of physical share certificates:i) Entry of share certificates in the computer on receipt thereof in the office.
ii) Scrutiny of transfer deeds. iii) Tallying of transferor's signature with the specimen signature available with the Registrar and Share Transfer Agent. iv) Data entry of transfer deeds. v) Preparation of objection memos and notices in respect of un-transferred shares. vi) Generation of checklist for valid and invalid transfer deeds. vii) Correction of data in the computer system on the basis of changes marked in the checklist. viii) Recording of transfer of shares in the computer system. ix) Endorsement and signatures on the reverse side of the share certificates. x) Generation of covering letters for the transferred share certificates and dispatch of transferred share certificates, objection memos and notices by registered post. Upon completion of the share transfer process, an offer letter is sent to the transferee with an option to receive credit of the transferred shares in electronic form, if so desired, under the Transfer-cum-Demat facility extended by the company. In terms of SEBI's letter number D&CC/NSDL-CDSL/3524/2003 dated 12th February, 2003, this facility is available for transfer upto 500 shares. Shareholders who opt for this facility by submitting the offer letter along with Dematerialisation Request Form (DRF) duly authenticated by Depository Participant (DP), receive electronic credit of their shares in their Demat Account maintained with DP .
In case transferee opts to receive transferred share certificate(s) in physical form or does not submit the offer letter within the stipulated time, share certificate(s) is/are sent to the transferee. Following is the procedure for dematerialization of shares:i) Entry of the share certificates and the dematerialization request form in the computer.
ii) Scrutiny of the share certificates and the dematerialization request form in the computer. iii) Tallying of signature of the shareholder on the dematerialization request form with the specimen signature available with the Registrar and Share Transfer Agent. iv) Data entry of transfer deeds. v) Generation of checklist. vi) Change of shares from physical to demat mode. vii) Send confirmation to NSDL and CDS(I)L.
l)
The Equity Shares of the company are actively traded at major Stock Exchanges in demat mode. As on 31st March, 2004, 69.34% of the shares were held in dematerialized mode by 90.86% of the total shareholders of the Company.
m) CONVERSION OF INSTRUMENTS On 29th March, 2004, the company has allotted, on a private placement basis, 14,700,000 Equity Shares of Rs. 10/- each at a premium of Rs. 326 per share to Deutsche Bank Trust Company Americas, which has issued 147,000 Global Depository Receipts (GDRs) of the face value of Rs. 336 per GDR to Woodgreen Investment Ltd. On 29th March, 2004, the company has also allotted 5,400,000 Warrants convertible into 5,400,000 Equity Shares of Rs. 10/- each at a premium of Rs. 326 per Share to Woodgreen Investment Ltd., on a private placement basis and on receipt of a consideration which is 10% of the face value of the Warrants. These Warrants are convertible, at the option of the Warrant- holder, within a period of 18 months from the date of allotment and on payment of the balance consideration of 90% of the face value of the Warrants, into an equivalent number of Equity Shares. As on date, Woodgreen Investment Ltd has neither exchanged its GDRs with Equity Shares nor has it converted the Warrants into Equity Shares.
n) PLANT LOCATIONS i) ii) iii) iv) v) vi) 66, NSEZ, Noida, District- Gautam Budh Nagar U.P . A-164, Sector 80 Noida- II, Distt. Gautam Budh Nagar U.P . B-4, NSEZ, Noida, District- Gautam Budh Nagar U.P . B-17, Sector 9, Noida, District- Gautam Budh Nagar U.P . A-33, Sector-57, Noida, U.P . 66, Udyog Vihar Industrial Area, Greater Noida, U.P .
o) ADDRESS FOR CORRESPONDENCE i) All correspondence regarding transfer and dematerialization of share certificates should be addressed to our Registrar and Share Transfer Agent - MCS Limited located at W-40, Okhla Industrial Area, Phase-II, New Delhi - 110 020. Following are the contact numbers: -
: : :
For any other information, the shareholders may contact the Company Secretary at the Registered Office of the company located at 43- A, Okhla Industrial Estate, New Delhi - 110020. Following are the contact numbers:Telephone numbers Fax numbers E-mail address : : : 51635201 to 51635205, 26911570-74 51635211, 26911860 shares@moserbaer.net
Certificate
To the members of Moser Baer India Limited We have examined the compliance of conditions of Corporate Governance by Moser Baer India Limited, for the year ended on March 31, 2004, as stipulated in Clause 49 of the Listing Agreement of the said company with 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 ensuring the compliance of the conditions of the 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 :1. We certify that the company has complied with the conditions of Corporate Governance as stipulated in the above mentioned Listing Agreement. 2. As per the records maintained by the Investors' Grievance Committee, no investor grievances against the company are pending for a period exceeding one month. 3. We further state that such compliance is neither an assurance as to the future viability of the company nor the efficiency or effectiveness with which the Management has conducted the affairs of the company. For K. C. Khanna & Co., Chartered Accountants (Nitin K. Jain) Partner Membership No. 83084 H-96, Connaught Circus, New Delhi 110 001 Date : June 18, 2004
UTI Bank Ltd., Statesman House, Barakhamba Road, New Delhi-110 001
The Karnataka Bank Ltd., Chaudhry Building, K Block, Connaught Circus, New Delhi-110 001
State Bank of India, Overseas Branch, Vijya Building, Barakhamba Road, New Delhi-110 001
Punjab National Bank, Large Corporate Branch, A-9, Connaught Circus, New Delhi-110 001
BNP Paribas, 1st India Place, A Block, Sushant Lok Phase I, Mehrauli Gurgaon Road, Gurgaon
The Bank of Nova Scotia, Dr.Gopal Das Bhawan, 28, Barakhamba Road, New Delhi-110 001
Export Import Bank of India, Centre One, Floor 21, World Trade Centre, Cuffe Parade, Mumbai-400 005
State Bank of Bikaner & Jaipur, G-72, Connaught Circus, New Delhi-110 001
ING Vysya Bank Ltd, G-35, Connaught Place, Opp. Madras Hotel, New Delhi-110 001
financials
auditors' report
To the Members of Moser Baer India Limited 1. We have audited the attached Balance Sheet of MOSER BAER INDIA LIMITED, as at 31 March, 2004, the Profit and Loss Account and also the Cash Flow Statement for the year ended on that date 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 the auditing standards generally accepted in India. These Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by Management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. 3. As required by the Companies (Auditor's Report) Order, 2003 issued by the Central Government of India in terms of subsection (4A) of Section 227 of the Companies Act, 1956, we enclose in the Annexure, a statement on the matters specified in paragraphs 4 and 5 of the said Order. 4. Further to our comments in the Annexure referred to above, we report that : i) ii) iii) iv) v) We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of our audit; In our opinion, proper books of account as required by law have been kept by the Company so far as appears from our examination of those books; The Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account; In our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956; On the basis of written representations received from the directors, as on 31st March, 2004, and taken on record by the Board of Directors, we report that none of the directors is disqualified as on 31st March, 2004 from being appointed as a director in terms of Clause (g) of sub-section (1) of Section 274 of the Companies Act, 1956; In our opinion and to the best of our information and according to the explanations given to us, the said accounts read with the Accounting Policies and Notes thereon, give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India: a) b) c) in the case of the Balance Sheet, of the state of affairs of the Company as at 31 March, 2004; in the case of the Profit and Loss Account, of the profit for the year ended on that date; and in the case of the Cash Flow Statement, of the cash flow for the year ended on that date.
st st
vi)
For K.C. Khanna & Co., Chartered Accountants (Nitin K. Jain) Partner Membership No. 83084 H-96, Connaught Circus, New Delhi 110 001. Dated : June 18, 2004
(ii)
(b) According to the information and explanations given to us, there are no dues of income-tax, wealth-tax, sales-tax, custom duty, excise duty and cess which have not been deposited on account of any dispute, except as furnished hereunder: Name of the statute Entry Tax Act Nature of the dues Realization of Entry tax for Assessment Year 1999-2000 and 2000-01 on account of entry tax exemption for purchase of machinery Goods found in excess of the quantity disclosed in the register maintained for stock keeping of excisable goods Amount (Rs) 106,059,645 Period to which the amount relates 1999-2000 and 2000-01 Forum where dispute is pending Supreme Court of India
105,250
1997-98
Total
106,164,895
10. The Company has neither accumulated losses at the end of the financial year nor incurred cash losses during the year and in the immediately preceding year. 11. In our opinion and according to the information and explanations given to us, the Company has not defaulted in repayment of dues to any financial institution or bank. The Company does not have any debenture holders. 12. According to the information and explanations given to us, the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities, and accordingly, the maintenance of records in this regard is not relevant for the year. 13. The Company is not a chit fund or a nidhi /mutual benefit fund / society; and accordingly, the provisions of clause 4(xiii) of the Companies (Auditor's Report) Order, 2003 are not applicable to the Company. 14. In our opinion, the Company is not dealing in or trading in shares, securities, debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the Companies (Auditor's Report) Order, 2003 are not applicable to the Company. 15. In accordance with the information and explanations given to us, the Company has not given any guarantees for loans taken by others from banks or financial institutions. 16. In our opinion, the term loans taken by the Company, have been applied for the purpose for which they were raised. 17. According to the information and explanations given to us and on an overall examination of the balance sheet of the Company, we report that no funds raised on short-term basis have been used for long-term investment. No long-term funds have been used to finance short-term assets, except permanent working capital. 18. During the year the Company has not made any preferential allotment of shares to parties and companies covered in the register maintained under section 301 of the Companies Act, 1956. 19. The Company did not have any outstanding debentures during the year. 20. The Company has not raised any money by public issue during the year. 21. According to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the course of our audit. For K.C. Khanna & Co., Chartered Accountants (Nitin K. Jain) Partner Membership No. 83084 H-96, Connaught Circus, New Delhi 110 001. Dated : June 18, 2004
balance sheet
As at 31st March (Amount in Rupees) I. SOURCES OF FUNDS SHAREHOLDERS FUNDS Share Capital Reserves and Surplus SHARE WARRANTS - Fully Convertible (Refer Note 11 of Schedule 19 - Part B) LOAN FUNDS Secured Loans Unsecured Loans Deferred Tax Liability (Refer Note 5 of Schedule 19 - Part B) TOTAL II. APPLICATION OF FUNDS FIXED ASSETS Gross Block Less: Depreciation Net Block Capital Work-in-progress INCIDENTAL EXPENDITURE PENDING CAPITALISATION (New Projects) INVESTMENTS CURRENT ASSETS, LOANS AND ADVANCES Inventories Sundry Debtors Cash and Bank Balances Loans and Advances Less: CURRENT LIABILITIES AND PROVISIONS Current Liabilities Provisions Net Current Assets MISCELLANEOUS EXPENDITURE (To the extent not written off or adjusted) TOTAL ACCOUNTING POLICIES AND NOTES ON ACCOUNTS As per our report of even date For K. C. Khanna & Co. Chartered Accountants. Nitin K. Jain Partner Membership No 83084 Place: New Delhi Date: June 18, 2004 19 34,513,929,187 23,237,664,841 13 8 9 10 11 12 3,075,358,858 273,319,375 3,348,678,233 10,422,391,183 -2,313,919,611 173,430,997 2,487,350,608 4,503,265,013 25,677,574 1,984,976,423 3,059,948,316 7,944,656,032 781,488,645 13,771,069,416 998,534,150 2,778,042,980 2,720,116,744 493,921,747 6,990,615,621 7 524,469,719 413,553,784 6 5 27,315,091,445 4,628,534,811 22,686,556,634 875,650,614 23,562,207,248 4,861,037 19,768,057,986 2,369,833,413 17,398,224,573 797,940,483 18,196,165,056 99,003,414 34,513,929,187 23,237,664,841 3 4 14,387,677,195 132,167,476 345,144,000 10,986,798,722 772,375,736 -1 2 1,115,129,440 18,352,371,076 19,467,500,516 181,440,000 484,064,720 10,994,425,663 11,478,490,383 -Schedule 2004 2003
As per our report of even date For K. C. Khanna & Co. Chartered Accountants. Nitin K. Jain Partner Membership No 83084 Place: New Delhi Date: June 18, 2004
Capital Reserve State Capital Investment Subsidy Securities Premium Account As per last Balance Sheet Added during the year
xiii) State Bank of Mysore xiv) Indian Bank (including interest accrued and due - Rs. 10,960)
2 3 4 5 6 7 8 9 10
UNSECURED LOANS -132,167,476 132,167,476 -132,167,476 100,025,500 667,800,000 767,825,500 4,550,236 772,375,736
Short Term Loans - from Banks - Rupee Loan - Foreign Currency Loans (USD 3,023,735 : Previous year USD 14,000,000) Add: Interest accrued and due Total Note: Foreign currency converted @ US$ 1 = Rs 43.71 : (Previous year US$1 = Rs 47.70)
Tangible Assets Land (Leasehold except to the extent of Rs 170,081) 268,919,516 --268,919,516 2,598,005 2,911,722 -5,509,727 263,409,789 Buildings 1,871,472,542 146,228,828 3,542,611 2,014,158,759 101,169,312 65,161,935 1,920,632 164,410,615 1,849,748,144 Leasehold Improvements -22,497,009 -22,497,009 -1,864,320 -1,864,230 20,632,689 Plant and Machinery, Electrical Installation and other Equipments 17,413,041,085 7,346,424,631 95,764,454 24,663,701,262 2,234,144,549 2,159,217,924 7,501,181 4,385,861,292 20,277,839,970 Furniture, Fixtures and office Equipments 93,825,972 36,123,263 999,426 128,949,809 19,053,084 8,004,510 364,627 26,692,967 102,256,842 Computers 41,909,113 33,936,562 724,835 75,120,840 7,781,985 10,086,938 177,281 17,691,642 57,429,198 Vehicles 13,985,574 1,001,815 16,662 14,970,727 3,841,095 1,544,433 205,020 5,180,508 9,790,219 Intangible Assets Software 9,785,106 7,995,264 -17,780,370 5,367 3,028,947 -3,034,314 14,746,056 Technical Know How 52,083,202 52,260,269 -104,343,471 -16,392,302 -16,392,302 87,951,169 Leased Assets Vehicles 3,035,876 1,613,806 -4,649,682 1,240,016 657,108 -1,897,124 2,752,558 Total 19,768,057,986 7,648,081,447 101,047,988 27,315,091,445 2,369,833,413 2,268,870,139 10,168,741 4,628,534,811 22,686,556,634 PREVIOUS YEAR 9,131,951,534 10,670,027,822 33,921,370 19,768,057,986 1,205,055,777 1,174,690,104 9,912,468 2,369,833,413 Capital work-in-Progress (including capital advances Rs. 93,838,078 : Previous year Rs. 83,784,046) 875,650,614 Total 23,562,207,248 Notes: 1. Additions to fixed assets include Rs.291,871,810 (Previous year Rs. 684,596,111) and deductions include Rs. 78,099,384 (Previous year Rs Nil)on account of exchange differences. 2. Interest Capitalised during the year Rs. 21,148,355 ( Previous Year Rs. 68,710,975).
266,321,511 1,770,303,230 --
15,178,896,536 74,772,888 34,127,128 10,144,479 9,779,739 52,083,202 1,795,860 17,398,224,573 797,940,483 18,196,165,056
As at 31st March (Amount in Rupees) 6 INCIDENTAL EXPENDITURE PENDING CAPITALISATION (New Projects) Opening Balance Additions during the year : Consumption of Materials, Stores, Tools etc Electricity and Power Salaries, allowances and other benefits Travelling Expenses (including for Directors) Interest & Financial Charges (net) Insurance Miscellaneous Expenses Legal and Professional Charges Total Less: Capitalised during the year Balance carried to Balance Sheet as at the year end 7 INVESTMENTS
2004
2003
331,147,605 60,637,648 71,244,390 51,582,948 6,017,877 110,828,550 12,204,514 13,749,665 16,172,507 673,585,704 574,582,290 99,003,414
Long Term: Unquoted - at cost (Trade): Investments in Subsidiaries European Optic Media Technology GmbH* Share Capital of Euro 2,025,000 Glyphics Media Inc - USA** 95 shares of US$ 10 each Investments in Others CAPCO LUXEMBOURG S.a.r.l. 1 Equity share of Euro 125 each 63,366 Preferred Equity Certificates of Euro 125 each Global Data Media FZ LLC (Associate)* 7,194 Shares of AED 1,000 each TOTAL (aggregate value of unquoted investments) (*Acquired and **Solid during the year) (For movements in other investments - Refer Note 4 of Schedule 19 - Part B) 92,532,185 524,469,719 413,553,784 4,961 320,668,823 320,673,784 4,961 320,668,823 320,673,784 -111,263,750 92,880,000 92,880,000 111,263,750 --
SUNDRY DEBTORS (Unsecured - considered good, unless otherwise stated) 306,887,998 54,102,105 360,990,103 54,102,105 2,753,060,318 6,582,661 2,759,642,979 6,582,661 2,753,060,318 3,059,948,316 306,887,998 24,114,070 35,265,827 59,379,897 35,265,827 2,753,928,910 -2,753,928,910 -2,753,928,910 2,778,042,980 24,114,070
Debts outstanding for a period exceeding six months Considered Good Considered Doubtful Less: Provision for Doubtful Debts Other Debts Considered Good Considered Doubtful Less: Provision for Doubtful Debts TOTAL 10 CASH AND BANK BALANCES 59,807,243 9,176,949
Cash on hand including cheques/drafts and imprest balances with employees (*includes cheques - Rs 54,285,261 : Previous year Rs. 4,630,663) Balances with Scheduled Banks: Current Accounts Margin Money/Fixed Deposit Accounts (Including interest accrued) (held under lien Rs. 559,340,982 : Previous year Rs. 264,782,784) Unclaimed Dividend Account EEFC Accounts (Euro 104,717 and USD 550,460 Previous Year Euro 2,361 and USD 48,366) Balances with Other Banks: Current Account with China Trust Commercial bank -124,825 29,341,423 7,537,599,118 2,405,257 2,316,189,850 5,709,205 5,382,909 514,318,671 6,988,229,819 186,304,078 2,122,097,606
Balances held outside India: ABN Amro Bank N.V. - Current Account (Euro 100,907 : Previous year Euro 3,335,704 ; GBP 20,815 ; USD 4,412,682) ING Bank N.V. - Current Account (Euro 6,217,922 : Previous year Nil) Deutsche Bank A.G. - Deposit Account (Euro 271,599 : Previous year Euro 269,660) 347,249,671 Total Notes: 1 Maximum balance outstanding at any time during the year was: - ABN Amro Bank N.V. : (Euro 5,383,040 : Previous year Euro 4,741,664) (Rs. 283,632,378 : Previous year Rs. 242,868,030) - ING Bank N.V. : (Euro 6,217,922 : Previous year Nil) (Rs. 327,622,299 : Previous year Rs. Nil) - Deutsche Bank A.G. : (Euro 271,599 : Previous year Euro 6,348,099) (Rs. 14,310,577 : Previous year Rs. 267,001,040) - China Trust Commercial Bank : (Rs. 124,825 : Previous year Rs. 124,925) 2 Rate of conversion applied: Euro 1 = Rs. 52.69; USD 1 = Rs. 43.28 : Previous year Euro 1 = Rs. 51.22; GBP 1 = Rs. 74.34; USD 1 = Rs. 47.23 7,944,656,032 394,625,120 2,720,116,744 14,310,577 13,811,998 327,622,299 -5,316,795 380,813,122
12 A.
CURRENT LIABILITIES AND PROVISIONS Current Liabilities: Sundry Creditors Small Scale Industrial Undertakings (Refer Note 10 of Schedule 19 - Part B) Others 971,751 2,801,049,678 2,802,021,429 Due to Directors Other Liabilities (Includes Rs. 63,546,003 : Previous year Rs. 119,560,438 due to banks being cheques issued in excess of book balances) Security Deposits Interest accrued but not due on Secured Loans Unclaimed Dividend Total 545,341 184,623,170 44,028,892 39,034,721 5,105,305 3,075,358,858 74,243,548 167,269,416 21,431,394 10,375,017 273,319,375 3,348,678,233 1,190,151 1,987,658,549 1,988,848,700 545,341 254,259,344 12,950,989 52,505,346 4,809,891 2,313,919,611 32,845,870 121,016,180 15,505,198 4,063,749 173,430,997 2,487,350,608
Provisions: For Taxation For Proposed Dividend For Corporate tax on Dividend For Retirement Benefits (Gratuity/Leave Encashment) Total
Total
13
MISCELLANEOUS EXPENDITURE (To the extent not written off or adjusted) ---25,556,827 120,747 25,677,574
14 a) b)
OTHER INCOME On Deposits with banks Others (Tax Deducted at Source Rs.15,713,446 : Previous year Rs. 9,942,307) 93,505,306 4,334,481 97,839,787 8,340,496 32,714,392 15,286,497 57,714 -593,386 74,834,796 229,667,068 42,219,789 199,285 42,419,074 4,258,222 164,860,621 12,925,620 -13,125 135,673 63,554,250 288,166,585
Excess provisions and unclaimed credit balances written back Difference in Exchange Rates (Net) Profit on sale of Forward Contracts (Net) Profit on sale of Fixed Assets Dividend from: long term investments current investments Miscellaneous Income Total
16
PERSONNEL EXPENSES 458,430,015 23,537,449 34,470,586 3,659,636 6,563,176 526,660,862 265,020,642 15,003,966 21,479,307 155,270 3,803,680 305,462,865
Salaries, Allowances and Bonus Contribution to Provident Fund and Other Funds Employees Welfare Expenses Leave Encashment Gratuity Total
17
ADMINISTRATION AND OTHER EXPENSES 503,402,620 1,917,743 14,085,440 32,499,845 2,164,250 12,408,987 15,048,759 354,628,887 100,622,267 5,577,333 589,050 4,068,520 811,761,616 1,249,867 33,400,757 60,684,766 372,834,835 155,583 14,417,593 200,467 120,747 25,556,827 2,367,396,759 356,682,670 1,043,199 522,226 41,205,135 469,325 4,093,059 8,334,954 236,259,845 73,016,929 2,931,174 145,000 3,661,450 704,839,739 7,500 30,151,818 38,850,137 204,437,327 39,762,632 5,152,450 2,895,433 419,731 2,572,170 1,757,453,903
Electricity and Power Excise Duty Commission on Sales (Other Selling Agents) Rent (Including Lease Rent) Repairs and Maintenance: Building Plant and Machinery Others
Freight and Forwarding Insurance Rates and Taxes Director's Sitting Fees Remuneration to Auditors Royalty/Technical Know-how Fees Loss on sale of long term investments Bad Debts Written Off Provision for doubtful debts and advances Miscellaneous Expenses Stock Written Off Fixed Assets Written Off (Refer Note 12(a) of Schedule 19 - Part B) Provision for Taxation (Foreign Branch) Miscellaneous Expenditure Written Off Deferred Revenue Expenditure Written Off (Refer Note 12(b) of Schedule 19 - Part B) Total
18
INTEREST AND FINANCE CHARTES 531,476,176 161,899,591 693,375,767 328,968,297 213,767,992 542,736,289
Cost of Raw Materials, goods held for resale, packing materials and stores and spares, is determined on the basis of 'Weighted Average' method. Cost of Work in process & finished goods, is determined by considering direct material cost and appropriate portion of overheads. Liability for excise duty in respect of goods manufactured by the company, other than for exports, is accounted upon completion of manufacture, and provision is made for exciseable manufactured goods. Customs duty exigible on materials (intended for domestic consumption), lying in bonded warehouses, is provided on accrual basis. 8. Government Grants Grants of the nature of contribution towards capital cost of setting up projects, are treated as Capital reserve and grants in respect of specific fixed assets are adjusted from the cost of the related fixed assets. 9. Borrowing Costs Borrowing costs directly attributable to the acquisition of qualifying assets are capitalised as part of the cost of assets till the date of commencement of commercial use of the asset. All other borrowing costs are charged to Profit and Loss Account. 10. Retirement Benefits Liability towards gratuity payable on death/retirement of employees is accrued based on an actuarial valuation, and covered by funding/premium as determined by Life Insurance Corporation of India. Provision for the benefit of leave encashment to the employees as per Company's policy is based on an actuarial valuation as of the balance sheet date. 11. Foreign Currency Transactions Transactions in foreign currency are converted at the exchange rate prevailing at the date of the transactions. Foreign currency monetary assets and liabilities not covered by forward exchange contracts are restated at the year end rates and the resultant gains or losses are recognised in the Profit and Loss Account, except exchange differences arising on settlement and/or translation of foreign currency liabilities relating to acquisition of fixed assets which are adjusted against the carrying costs of respective fixed assets. In respect of foreign branches, all revenues, expenses, monetary assets/liabilities and fixed assets are accounted at the exchange rate prevailing on the date of the transaction. Monetary assets and liabilities are restated at the year end rates and resultant gains or losses are recognised in the Profit and Loss Account. Gains and losses on foreign exchange forward contracts are recognised in the Profit and Loss Account over the life of the contract, except in respect of liabilities incurred for acquiring fixed assets, in which case such difference is adjusted to the carrying amount of the respective fixed assets. Any profit or loss arising on cancellation of a forward contract is recognised as income or expense for the period. 12. MISCELLANEOUS EXPENDITURE Expenditure in respect of issue of shares, pre-incorporation and other preliminary expenses, is written-off over a period of 10 years from the year in which these are incurred. 13. Taxation Provision is made for current income tax liability based on the applicable provisions of the Income Tax Act 1961, for the income chargeable under the said Act and as per the applicable overseas laws relating to the foreign branch.
1.3 Claims against the Company not acknowledged as debts - Rs 1.47 Million (Previous Year Rs.7.34 Million) Capital Commitments Estimated value of contracts remaining to be executed on capital account and not provided for (net of advances) - Rs.2,245.48 Million (Previous Year Rs.1,438.70 Million). Lease Obligations Future obligations for rentals under operating leases amount to Rs. 146.69 Million (Previous year Rs. 16.57 Million). The total lease payments recognised in the statement of profit and loss account amounting to Rs. 21.35 Million (Previous year Rs. 20.90 Million) Future obligations for rentals under finance lease arrangement for plant and machinery amount to Rs. Nil (Previous year Rs. 1.90 Million). Reconciliation of minimum lease payments and their present value in respect of vehicles taken on lease , is as under Present value of Minimum Lease payments (Rs) Amount paid upto 31.3.2004 Amount payable not later than one year Amount payable later than one year but not later than five years Total Previous year 2,579,558 994,009 2,646,019 6,219,586 4,299,025 minimum lease payments (Rs) 1,587,512 667,747 2,312,022 4,567,281 2,641,606 Lease charges (Rs) 992,046 326,262 333,997 1,652,305 1,657,419
The total cost of the vehicles and their carrying amount as at 31st March 2004 are Rs. 4,649,682 (Previous Year Rs.3,035,876) and Rs.2,752,558 (Previous Year Rs.1,795,860) respectively. 4. Movements in Other Investments 2003-04 Current Investments (Unquoted) (Mutual Fund Units of the Face value of Rs. 10 each acquired/sold during the year) Total 5. Taxation Provision for taxation has been made based on Minimum Alternate Tax as applicable to the company for the current year in accordance with the relevant provisions of the Income Tax Act, 1961. During the year ended 31.03.2003, based on expert opinion obtained, the deferred tax liability was considered at nil, in view of the exemption available to the undertakings of the company under Income Tax Act, 1961, the computation / determination of such tax liability being measured in the proportion of profits of the undertakings from domestic operations in section 10A/10B of the said act in accordance with the expert opinion obtained to that effect. The management has made a review of the matter and sought a fresh opinion as regard the interpretation of ASI-5 read with AS-22 'Accounting for Taxes on Income' issued by the Institute of Chartered Accountants of India; and based thereon and as a prudent measure decided to provide for the deferred tax liability upto the year 2003-04. Deferred tax liability is net of deferred tax asset of Rs. 860,126,966 on account of losses to be setoff against taxable profit in future. Based on its existing and potential business in the near future, including projections / profitability the management is virtually certain of such setoff of the unabsorbed losses; on which assertion the auditor have placed reliance. In consonance with the methodology so adopted, a recomputation of deferred tax liability has been made for the year, as well as upto the preceding year end (which has been considered as a prior period item and separately shown in the Profit and Loss Account). Birla Sun Life Mutual Fund Prudential ICICI Mutual Fund SBI Mutual Fund 51,025,506 22,650,584 4,755,111 78,431,201 550,316,573 285,219,588 50,038,012 885,574,173 21,209,115 11,640,524 -32,849,639 225,000,000 160,000,000 -385,000,000 No. Cost (Rs.) 2002-03 No. Cost (Rs.)
Particulars of Timing Differences (a) Upto the Financial year 2002-03 Depreciation Unabsorbed Depreciation Brought Forward Losses Total (b) For the Financial year 2003-04 Depreciation Unabsorbed Depreciation Total Total Deferred Tax Liability 6
Net Deferred Tax Liability (Rs.) 790,769,638 (443,874,000) (18,464,638) 328,431,000 414,501,328 (397,788,329) 16,713,000 345,144,000
Employee Stock Option Plan (ESOP) The Company, has on 09-01-2004, in terms of ESOP granted 2,030,300 stock options to its employees, at the exercise price of Rs. 342 per share. The Options granted are vested over a period of maximum of four years from the date of grant. As at the date of balance sheet no option has been exercised by any employee. ADDITIONAL INFORMATION PURSUANT TO REQUIREMENTS OF PART II OF SCHEDULE VI TO THE COMPANIES ACT, 1956 (As Certified By The Management), AND OTHER DISCLOSURES 7.1 Licensed Capacity 7.2 Installed Capacity (figures in bracket are for the previous year) Storage Media ( Nos.) Not Applicable for any product of the company *Installed Capacity 2,125,820,000 (1,185,820,000) * (As certified by the management and on which auditors have placed reliance without verification, this being a technical matter) 7.3 In terms of order no. 46/64/2004-CL-III dated 16.06.2004 issued by Department of Company Affairs under Section 211(4) of the Companies Act, 1956 disclosure has not been made for the quantitative details for the accounting year 2003-04, in respect of details pursuant to paras 3(i) (a) and 3(ii) (a), (1) & (2) of part II of Schedule VI to the Companies Act, 1956 (as amended vide Notification No GSR 494 (E) dated 30th October, 1973). 7.4 Composition of Raw Materials, Packing Materials and Spares Consumed: (figures in bracket are for the previous year) Raw Materials & Packing Material Percentage a) b) Imported Indigenous Total 54.13 (79.92) 45.87 (20.08) 100.00 (100.00) Value (Rs.) 3,038,794,910 (2,671,784,338) 2,575,235,723 (671,125,747) 5,614,030,633 (3,342,910,085) Percentage 76.87 (75.30) 23.13 (24.70) 100.00 (100.00) Stores & spares Value (Rs.) 355,053,248 (318,986,134) 106,811,712 (104,645,494) 461,864,960 (423,631,628) Actual Production 1,608,396,069 (931,474,745)
7.5 Foreign Currency Transactions: 2003-04 (Rs.) 7.5.1 Value of Imports on C.I.F Basis: Purchase of Finished Goods Raw Materials & Components Capital Goods (including Rs.498.29 Million : Previous year Rs. 580.37 Million debited to Capital work in progress) Stores, Spares and Consumables Packing Material 13,044,068 4,397,395,533 6,431,204,686 530,378,919 58,959,943 67,878,743 2,293,174,829 5,536,767,467 298,044,749 35,997,503 2002-03 (Rs.)
7.5.4 Amount remitted in Foreign Currencies for Dividend: Dividend remitted on fully pad - up equity shares of Rs. 10 each a) b) c) d) Number of Non Resident Shareholders Number of Shares held Year to which relates Dividend remitted in (Rs.) 2 5,887,615 2002-2003 14,719,038 3 5,889,715 2001-2002 14,724,288 (Amount in Rupees) DEEPAK PURI* NITA PURI* RATUL PURI* Managing Director Whole time director Whole time director a) b) c) Total Salaries/Allowances PF contribution Perquisites 1,725,600 (1,440,000) 115,200 (115,200) 95,054 (357,600) 1,935,854 (1,912,800) 7.7 Related Party Transactions: In accordance with the requirements of Accounting Standard - 18 'Related Party Disclosures' the names of the related party where control exists/able to exercise significant influence along with the aggregate transactions and year end balance with them as identified and certified by the management are given below: 7.7.1 Nature of relationship Subsidiary Subsidiary Associate Company Key Management Personnel Managing Director Whole Time Directors Mr Deepak Puri Mrs Nita Puri Mr Ratul Puri Name of the related party European Optic Media Technology GmbH Glyphics Media Inc, USA Global Data Media FZ LLC (including its subsidiaries) Share holding 100% Divested 49% 454,800 (420,000) 36,000 (36,000) 103,400 (112,517) 594,200 ( 568,517) 2,910,000 (2,220,000) 180,000 (180,000) 107,990 (772,068) 3,197,990 (3,172,068)
7.6 Managerial Remuneration (Remuneration to Directors): (figures in bracket are for the previous year)
Note: Provision for leave encashment and Gratuity amounting to Rs. 272,988 and Rs. 652,309 respectively made during the year has not been included above.
Equity Acquired
Note: Due to the issue of bonus Shares during the year 2003-04, the Earnings Per Share for financial year 2002-03 has been recomputed/restated. Secondary segment information (by Geographic segments) Domestic Operations Revenues-Sales (net of taxes/duties) (Current Year) Revenues-Sales (net of taxes/duties) (Previous Year) Carrying Amount of Segment Assets (Current Year) Carrying Amount of Segment Assets (Previous Year) Notes on Segment Information: Considering the nature of the company's business, its activities and operations, the internal financial reporting and the element of risk and returns, as also that it is predominantly engaged in the manufacture of storage media products, there are no business segments within the meaning of AS 17 - Segment Reporting,Information has therefore, been given as above in relation to the domestic/overseas operations, by way of geographic segments. 2,348,182,348 1,225,058,915 130,155,808 139,160,146 Overseas Operations 12,673,487,530 9,436,822,174 2,929,792,508 2,638,882,834 Total 15,021,669,878 10,661,881,089 2,059,948,316 2,778,042,980
13. Corresponding figures for the previous year have been regrouped/rearranged, wherever necessary to conform to current year classification. 14. Schedules 1 to 19 are annexed to and form an integral part of the Balance Sheet as at 31.3.2004 and the Profit and Loss Account for the year ended on that date.
For K. C. Khanna & Co. Chartered Accountants. Nitin K. Jain Partner Membership No 83084 Place: New Delhi Date: June 18, 2004
Cash and cash equivalents comprise: Cash, Cheques / Drafts and imprest balances with employees Fixed Deposits Balance with Banks 59.81 6,988.23 896.62 7,944.66 Notes: 1 2. 3 The above Cash flow statement has been prepared under the indirect method set out in AS-3 'Cash Flow Statements' issued by the Institute of Chartered Accountants of India Interest paid is exclusive of and purchase of Fixed Assets is inclusive of interest capitalised Rs. 21.15 Million (Previous Year Rs. 68.71 Million) Purchase of Investments include purchase of shares in subsidiary and associate: (a) (b) 4 5 European Optic Media GmbH (Subsidiary) Rs. 111.26 Million (Previous Year Rs. Nil.) Global Data Media FZ LLC (associate) Rs. 92.53 Million (Previous Year Rs. Nil.) 9.18 2,122.10 588.84 2,720.12
Previous year figures have been regrouped and recast wherever necessary to conform to the current year classification Following non cash transactions have not been considered in the cash flow statement Tax deducted at source Assets acquired on credit/lease/hire purchase
Cash and cash equivalents include Rs. 5,709,205: Previous year Rs. 5,382,909 which are not available for use by the Company. (Refer schedule 10 in the accounts)
As per our report of even date For K. C. Khanna & Co. Chartered Accountants. Nitin K. Jain Partner Membership No 83084 Place: New Delhi Date: June 18, 2004
Month
Total Assets 3 4 5 1 3 9 2 9
Sources of Funds Paid-up Capital 1 Share Warrants 1 Secured Loans 1 4 3 8 7 6 7 7 8 1 4 4 0 Deferred Tax Liability 3 4 5 1 4 4 1 1 5 1 2 9 Reserves & Surplus 1 8 3 5 2 3 7 1
Unsecured Loans 1 3 2 1 6 8
Accumulated Losses N I L
Generic Name of Three Principal Products/Services of Company (as per monetary terms) Item Code No. : (ITC Code) Product Description : Item Code No : (ITC Code) Product Description : Item Code No : (ITC Code) Product Description : 852320 MAGNETIC DISK 852390 COMPACT DISK RECORDABLE 847193.09 STORAGE UNITS Harnam D.Wahi Director Minni Katariya Company Secretary R Ganesan General Manager Accounts
Deepak Puri Chairman and Managing Director Place: New Delhi Date: June 18, 2004
directors' report
To the members, The Directors are pleased to present the First Annual Report and Accounts for the year ended 31st March, 2004. A summary of the financial results is as follows:Particulars Income (Bank Interest) Administrative expenses Net loss Accumulated deficit at end of the year Operations For 2003-04 3,226 198,932 (195,706) (195,706)
The Company is in the process of installing a manufacturing facility in the State of Thueringen. A plot of land has been identified and the architectural work has been completed. All the requisite building permissions have been obtained. Future Actions This project is eligible for State aid and the Government also guarantees part of the bank funding. Efforts are also being made to obtain the financial closure and the necessary Government sanctions for the state aid and guarantees. Construction of the factory premises is likely to start once all the permissions are in place and the financial closure has been obtained. Auditors Since the Company is still in the start-up phase, no audit is required as per German laws. Particulars of Employees There were no employees on board till the 31st March 04.
Place: Erfurt Date: 16th June, 2004 V J Prakash Managing Director
balance sheet
As at 31st March, 2004 SOURCES OF FUNDS Authorized Capital Share Capital RESERVES AND SURPLUS Capital Reserve Opening Balance Profit/(Loss) during the period Total APPLICATION OF FUNDS Assets Project Expenses Current Assets Bank Balances VAT receivable Less: Current Liabilities & Provisions Total
Note
EUR 2,025,000
2,025,000
European Optic Media Technology was incorporated in Erfurt, Germany on January 30, 2003. The Company has its registered office at Maiozerhofstrabe 12, 99084 Erfurt, Germany. The object of the company are the pan-European trade and production of data media. The Company may conduct all business which directly or indirectly promotes its objects or which furthers the developments of its product. The first financial year shall begin on 30th January 2003 and terminates on 31st March 2004. 2 SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 2.1 Foreign currencies The accounts are held in EURO Assets, Liabilities, Income and expenses are recorded at the rates Prevailing at the balance sheet date. Realised gains and losses as well as unrealised losses are recorded in the profit and loss account. 2.2 Project Expenses Project expenses represent expenses incurred during the project stage, which will be apportioned to the value of the assets capitalized. 3 4 CAPITAL The subscribed capital is fully paid up and is represented by 1 share of a par value of EURO 2,025,000. CREDITORS Trade creditors represent expenses payable and due within one year.
section 212
Statement under Section 212 of the Companies Act, 1956 relating to the Subsidiary Company
1 2 3 4 Name of the Company Financial period of the Subsidiary ended on Holding Companys Interest in the Subsidiary Company Net aggregate amount of the Profit/(Loss) of the Subsidiary Company (concerning the members of Moser Baer India Limited) not dealt with or provided for in the accounts of Moser Baer India Limited (a) (b) 5 For the current year For the previous years since it became a subsidiary *(EURO 195,706) (Rs. 10,570,275) Not applicable, since this is the first period of operations of subsidiary Net aggregate amount of the Profit/(Loss) of the Subsidiary Company (concerning the members of Moser Baer India Limited) dealt with or provided for in the accounts of Moser Baer India Limited (a) (b) For the current year For the previous years since it became a subsidiary Nil NA European Optic Media Technology GmbH 31st March, 2004 100% of Equity Share Capital of Euro 2,025,000
Deepak Puri Chairman and Managing Director Place: New Delhi Date: June 18, 2004
The financial statements of these subsidiaries are unaudited, and in respect of European Optical Media Technology GmbH, consolidation covers a period of more than 12 months. 2. The Financial Statements of the associate, Global Data Media FZ LLC, for the period from 17 September, 2002 (date of incorporation) to st 31 December, 2003, have been audited by another auditor whose report has been made available to us, and our opinion in so far as it relates to the amounts included in respect of the associate, is based solely on the report of the other auditor, except that the reporting period is more than 12 months not ending on the same date as that of the parent company. We report that the consolidated financial statements have been prepared by the Company in accordance with the requirements of Accounting Standard-21, Consolidated Financial Statements and Accounting Standard-23, Accounting for Investments in Associates in Consolidated Financial Statements, issued by the Institute of Chartered Accountants of India and on the basis of the separate financial statements of Moser Baer India Limited, its subsidiaries and associate included in the Consolidated Financial Statements. On the basis of the information and explanations given to us and on the consideration of the separate audit report on individual audited financial statements of Moser Baer India Limited and its aforesaid subsidiaries and associate, subject to consolidation of results of overseas entities on the basis as stated in paras 1 and 2 above, we are of the opinion that the consolidated financial statements gives a true and fair view in conformity with the accounting principles generally accepted in India : a) b) c) in the case of Consolidated Balance Sheet, of the consolidated state of affairs of the company, its subsidiaries and associate as at March 31, 2004; in the case of Consolidated Profit and Loss Account, of the consolidated results of operations of the Company, its subsidiaries and associate, for the year then ended; and in the case of the Consolidated Cash Flow Statement, of the consolidated cash flow of the Company, its subsidiaries and associate for the year then ended. For K.C. Khanna & Co., Chartered Accountants (Nitin K. Jain) Partner Membership No. 83084 H-96, Connaught Circus, New Delhi 110 001. Dated : June 18, 2004
th
3.
4.
2004
2003
-27,315,091,445 4,628,534,811 22,686,556,634 940,150,593 23,626,707,227 4,861,037 382,437,324 1,984,976,423 3,059,948,316 8,000,119,947 760,450,669 13,805,495,355 3,076,491,965 273,319,375 3,349,811,340 10,455,684,015 -34,469,689,603
4,641,794 19,770,371,711 2,371,151,535 17,399,220,176 797,940,483 18,197,160,659 99,003,414 320,673,784 1,038,204,464 2,708,473,674 2,744,574,300 494,933,559 6,986,185,997 2,316,240,073 173,477,982 2,489,718,055 4,496,467,942 25,677,574 23,143,625,167
consolidated profit and loss account of MoserBaer India Limited and its subsidiaries/associate
For the year ended 31st March (Amount in Rupees) INCOME Gross Sales Less: Duty (Including Excise Duty) Other Income Increase/(Decrease) in stock of Finished Goods/Work in Process EXPENDITURE Raw Materials and Components Consumed Trade Purchases Stores, Spares and Tools Consumed Personnel Expenses Administration and Other Expenses Interest and Finance Charges Depreciation Share in loss of Associate PROFIT BEFORE TAX Provision for Taxation: Current Tax Deferred Tax Net Profit after Provision for Taxation Short Provision of Taxation for earlier years Provision for Deferred Tax for earlier years (Considered as Prior Period Item - Refer Note 4.2.5 of Schedule 19) NET PROFIT AFTER TAX Less: Minority interest NET PROFIT/SURPLUS AVAILABLE FOR APPROPRIATION APPROPRIATIONS Dividend: Preference Shares Equity Shares (Proposed) Corporate Tax on Proposed Dividend Transfer to General Reserve TOTAL Earnings per share (Face Value of Rs. 10 each) Basic & Diluted : - Before prior period items - After prior period items (Refer Note 4.2.9 of Schedule 19) ACCOUNTING POLICIES AND NOTES ON ACCOUNTS 19 37.31 33.92 23.97 23.97 -167,269,416 167,269,416 21,431,394 3,099,610,223 3,288,311,033 8,435,959 121,016,180 129,452,139 15,505,198 2,184,297,154 2,329,254,491 328,431,000 3,288,311,033 -3,288,311,033 -2,327,242,033 (2,012,458) 2,329,254,491 32,500,000 16,713,000 3,627,054,243 10,312,210 23,586,472 (36,392,225) 2,327,242,033 -16 17 18 5,614,030,633 151,300,075 461,864,960 535,876,200 2,391,231,797 693,647,033 2,268,870,139 30,768,645 12,147,589,482 3,676,267,243 3,342,910,085 336,425,595 423,631,628 335,281,053 1,774,641,750 543,381,034 1,175,178,410 -7,931,549,555 2,314,436,280 14 15 15,981,117,269 770,524,261 15,210,593,008 332,876,237 280,387,480 15,823,856,725 11,119,910,347 193,337,862 10,926,572,485 289,386,296 (969,972,946) 10,245,985,835 Schedule 2004 2003
As per our report of even date For K. C. Khanna & Co. Chartered Accountants. Nitin K. Jain Partner Membership No 83084 Place: New Delhi Date: June 18, 2004
Capital Reserve State Capital Investment Subsidy Securities Premium Account As per last Balance Sheet Added during the year
xiii) State Bank of Mysore xiv) Indian Bank (including interest accrued and due - Rs. 10,960)
2 3 4 5 6 7 8 9 10
UNSECURED LOANS -132,167,476 132,167,476 -132,167,476 100,025,500 667,800,000 767,825,500 4,550,236 772,375,736
Short term loans - from banks - Rupee Loan - Foreign Currency Loans (USD 3,023,735 : Previous year USD 14,000,000) Add: Interest accrued and due Total Note: Foreign currency converted @ US$ 1 = Rs 43.71 : (Previous year US$1 = Rs 47.70)
Tangible Assets Land (Leasehold except to the extent of Rs 170,081) 268,919,516 --268,919,516 2,598,005 2,911,722 -5,509,727 263,409,789 Buildings 1,871,472,542 146,228,828 3,542,611 2,014,158,759 101,169,313 65,161,935 1,920,633 164,410,615 1,849,748,144 Leasehold Improvements -22,497,009 -22,497,009 -1,864,320 -1,864,230 20,632,689 Plant and Machinery, Electrical Installation and other Equipments 17,413,041,086 7,346,424,630 95,764,454 24,663,701,262 2,234,144,549 2,159,217,924 7,501,181 4,385,861,292 20,277,839,970 Furniture, Fixtures and Office Equipments 96,139,696 36,123,263 3,313,150 128,949,809 20,371,205 8,004,510 1,682,748 26,692,967 102,256,842 Computers 41,909,113 33,936,562 724,835 75,120,840 7,781,985 10,086,938 177,281 17,691,642 57,429,198 Vehicles 13,985,574 1,001,815 16,662 14,970,727 3,841,095 1,544,433 205,020 5,180,508 9,790,219 Intangible Assets Software 9,785,106 7,995,264 -17,780,370 5,367 3,028,947 -3,034,314 14,746,056 Technical Know How 52,083,202 52,260,269 -104,343,471 -16,392,302 -16,392,302 87,951,169 Leased Assets Vechicles 3,035,876 1,613,806 -4,649,682 1,240,016 657,108 -1,897,124 2,752,558 Total 19,770,371,711 7,648,081,446 103,361,712 27,315,091,445 2,371,151,535 2,268,870,139 11,486,863 4,628,534,811 22,686,556,634 PREVIOUS YEAR 9,134,244,794 10,670,048,287 33,921,370 19,770,371,711 1,205,785,593 1,175,278,410 9,912,468 2,371,151,535 Capital work-in-Progress (including capital advances Rs. 93,838,078 : Previous year Rs. 83,784,046) 940,150,593 Total 23,626,707,227 Notes: 1. Additions to fixed assets include Rs.291,871,810 (Previous year Rs. 684,596,111) and deductions include Rs. 78,099,384 (Previous year Rs Nil)on account of exchange differences. 2. Interest Capitalised during the year Rs. 21,148,355 ( Previous Year Rs. 68,710,975).
266,321,511 1,770,303,229 --
15,178,896,537 75,768,491 34,127,128 10,144,479 9,779,739 52,083,202 1,795,860 17,399,220,176 797,940,483 18,197,160,659
As at 31st March (Amount in Rupees) 6 INCIDENTAL EXPENDITURE PENDING CAPITALISATION (New Projects) Opening Balance Additions during the year : Consumption of Materials, Stores, Tools etc Electricity and Power Salaries, allowances and other benefits Travelling Expenses (including for Directors) Interest & Financial Charges (net) Insurance Miscellaneous Expenses Legal and Professional Charges Total Less: Capitalised during the year Balance carried to Balance Sheet as at the year end 7 INVESTMENTS
2004
2003
331,147,605 60,637,648 71,244,390 51,582,948 6,017,877 110,828,550 12,204,514 13,749,665 16,172,507 673,585,704 574,582,290 99,003,414
Long Term: Unquoted - at cost (Trade): Investments in Others CAPCO LUXEMBOURG S.a.r.l. 1 Equity share of Euro 125 each 63,366 Preferred Equity Certificates of Euro 125 each Global Data Media FZ LLC (Associate)* 7,194 Shares of AED 1,000 each (Refer Note 2.2 of Schedule 19) TOTAL (aggregate value of unquoted investments) (*Acquired during the year) (For movements in other investments - Refer Note 4.2.4 of Schedule 19) 382,437,324 320,673,784 61,763,540 4,961 320,668,823 320,673,784 4,961 320,668,823 320,673,784
SUNDRY DEBTORS (Unsecured - considered good, unless otherwise stated) 306,887,998 54,102,105 360,990,103 54,102,105 306,887,998 24,114,070 38,108,747 62,222,817 38,108,747 24,114,070 2,684,359,604 -2,684,359,604 -2,684,359,604 2,708,473,674
Debts outstanding for a period exceeding six months Considered Good Considered Doubtful Less: Provision for Doubtful Debts Other Debts Considered Good Considered Doubtful Less: Provision for Doubtful Debts TOTAL 10 CASH AND BANK BALANCES 115,271,158 33,634,505 2,753,060,318 6,582,661 2,759,642,979 6,582,661 2,753,060,318 3,059,948,316
Cash on hand including cheques/drafts and imprest balances with employees (*includes cheques - Rs 54,285,261 : Previous year Rs. 4,630,663) Balances with Scheduled Banks: Current Accounts Margin Money/Fixed Deposit Accounts (Including interest accrued) Unclaimed Dividend Account EEFC Accounts (Euro 104,717 and USD 550,460 Previous Year Euro 2,361 and USD 48,366) Balances with Other Banks: Current Account with China Trust Commercial bank Balances held outside India: ABN Amro Bank N.V. - Current Account (Euro 100,907 : Previous year Euro 3,335,704 ; GBP 20,815 ; USD 4,412,682) ING Bank N.V. - Current Account (Euro 6,217,992 : Previous year Nil) Deutsche Bank A.G. - Deposit Account (Euro 271,599 : Previous year Euro 269,660) 347,249,671 Total Notes: 1 Maximum balance outstanding at any time during the year was: - ABN Amro Bank N.V. : Euro 5,383,040 : Previous year Euro 4,741,664) (Rs. 283,632,378 : Previous year Rs. 242,868,030) - ING Bank N.V. : (Euro 6,217,922 : Previous year Nil) (Rs. 327,622,299 : Previous year Rs. Nil) - Deutsche Bank A.G. : (Euro 271,599 : Previous year Euro 6,348,099) (Rs. 14,310,577 : Previous year Rs. 267,001,040) - China Trust Commercial Bank : (Rs. 124,825 : Previous year Rs. 124,925) 2 Rate of conversion applied: Euro 1 = Rs. 52.69; USD 1 = Rs. 43.28 : Previous year Euro 1 = Rs. 51.22; GBP 1 = Rs. 74.34; USD 1 = Rs. 47.23 8,000,119,947 394,625,120 2,744,574,300 14,310,577 13,811,998 327,622,299 -5,316,795 380,813,122 29,341,423 7,537,599,118 -2,405,257 2,316,189,850 124,825 5,709,205 5,382,909 514,318,671 6,988,229,819 186,304,078 2,122,097,606
Miscellaneous Income
16
PERSONNEL EXPENSES 467,645,353 23,537,449 34,470,586 3,659,636 6,563,176 535,876,200 294,838,830 15,003,966 21,479,307 155,270 3,803,680 335,281,053
Salaries, Allowances and Bonus Contribution to Provident Fund and Other Funds Employees Welfare Expenses Leave Encashment Gratuity Total
17
ADMINISTRATION AND OTHER EXPENSES 503,402,620 1,917,743 16,326,732 32,700,226 2,164,250 12,408,987 15,279,435 358,280,811 101,153,454 5,641,778 589,050 4,068,520 811,761,616 1,249,867 33,533,940 60,684,766 389,616,785 155,583 14,417,593 200,467 120,747 25,556,827 2,391,231,797 356,682,670 1,043,199 522,226 43,016,099 469,325 4,093,059 8,619,447 236,259,845 74,599,319 2,931,174 145,000 3,661,450 704,839,739 7,500 30,292,383 38,850,137 217,806,762 39,762,632 5,152,450 2,895,433 419,731 2,572,170 1,774,641,750
Electricity and Power Excise Duty Commission on Sales (Other Selling Agents) Rent (Including Lease Rent) Repairs and Maintenance: Building Plant and Machinery Others
Freight and Forwarding Insurance Rates and Taxes Director's Sitting Fees Remuneration to Auditors Royalty/Technical Know-how Fees Loss on sale of long term investments Bad Debts Written Off Provision for doubtful debts and advances Miscellaneous Expenses Stock Written Off Fixed Assets Written Off (Refer Note 4.2.12(a) of Schedule 19) Provision for Taxation (Foreign Branch) Miscellaneous Expenditure Written Off Deferred Revenue Expenditure Written Off (Refer Note 4.2.12(b) of Schedule 19) Total
18
INTEREST AND FINANCE CHARGES 531,476,176 162,170,857 693,647,033 328,968,297 214,412,737 543,381,034
Consolidation Procedure: 3.1 The Consolidated Financial Statements are prepared in accordance with Accounting Standard (AS-21) Consolidated Financial Statements issued by the Institute of Chartered Accountants of India (ICAI). The financial statements of the Parent and its subsidiaries are combined on a line by line basis by adding together sums of like nature, comprising assets, liabilities, income and expenses, after eliminating intra-group balances/ transactions and resulting unrealized profit/ loss. 3.2 The Financial Statements of subsidiaries, which are overseas, are prepared by them on the basis of generally accepted accounting principles, local laws and regulations as prevalent in their respective countries and such financial statements are considered for consolidation. The effect of adjustments on account of variance in accounting policies of overseas subsidiaries vis '--vis those of the parent is not material, and accordingly, not considered. The Financial Statements of associate is prepared by them on the basis of generally accepted accounting principles, local laws and regulations as prevalent in the respective country. The effect of adjustments on account of variance in accounting policies of associate vis--vis that of the parent is not considered material and, accordingly, not considered. 3.3 Investments in associate are accounted for under the Equity Method as per AS-23 Accounting for Investments in Associates in Consolidated Financial Statements issued by The Institute of Chartered Accountants of India based on the financial statements of the associate upto period ended on 31st December, 2003. 3.4 Minority interest in the net income of subsidiary has been identified and adjusted against the income of the group in order to arrive at the net income attributable to the Parent company. 3.5 The financial statements of the subsidiaries viz Glyphics Media Inc has been drawn upto 31st August, 2003 i.e. upto the date of holding before divestment; European Optic Media Technology GmbH has been drawn for the period from 30th January, 2003 to 31st March, 2004 and that of the associate have been drawn for the period from 17th September, 2002 to 31st December, 2003. There are no significant transactions or other events between 1st January, 2004 to 31st March, 2004 requiring adjustment therein. 3.6 One of the subsidiaries viz. European Optic Media Technology GmbH, the financial statements of which, as per local laws/regulations are not required to be audited, have been considered as such in the consolidated financial statements. 3.7 The Parents cost of its investment in its subsidiaries has been eliminated against the Parents portion of equity of each subsidiary as at the year end, instead of Parents portion of equity of each subsidiary as on the date on which investment is made in the subsidiary. The amount of Goodwill/ Capital Reserve on consolidation has not arisen being newly formed companies. 3.8 The difference between the proceeds from disposal of investment in a subsidiary and the carrying amount of its assets less liabilities as of the date of disposal is recognised in the consolidated statement of Profit and Loss Account as the profit or loss on disposal of investment in subsidiary. 3.9 For the purpose of compilation of the consolidated financial statements the foreign currency assets, liabilities , income and expenditure are translated as per Accounting Standard (AS-11) on 'Accounting for the effects of changes in foreign exchange rates', issued by the Institute of Chartered Accountants of India. 3.10 Additional Disclosures: Additional information disclosed in the separate financial statements of the parent and the subsidiaries having no bearing on the true and fair view of the CFS, as also the information pertaining to the items which are not material, have not been disclosed in the CFS.
Significant Accounting Policies and Notes on Accounts of the Parent: 4.1 Significant Accounting Policies: 4.1.1 Method of Accounting The financial statements are prepared in accordance with the historical cost convention on an accrual basis of accounting and in accordance with generally accepted accounting practices in India and conform to the applicable Accounting Standards issued by the Institute of Chartered Accountants of India and relevant provisions of the Companies Act, 1956. 4.1.2 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 on the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Difference between the actual results and estimates is recognised in the period in which the results are crystallised.
Cost of Raw material, goods held for resale, packing materials and stores and spares, is determined on the basis of weighted average method. Cost of Work in process and finished goods, is determined by considering direct material cost and appropriate portion of overheads. Liability for excise duty in respect of goods manufactured by the company, other than for exports, is accounted upon completion of manufacture, and provision is made for exciseable manufactured goods. Customs duty exigible on materials (intended for domestic consumption), lying in bonded warehouses, is provided on accrual basis. 4.1.8 Government Grants Grants of the nature of contribution towards capital cost of setting up projects, are treated as Capital Reserve and grants in respect of specific fixed assets are adjusted from the cost of the related fixed assets. 4.1.9 Borrowing Costs Borrowing costs directly attributable to the acquisition of qualifying assets are capitalised as part of the cost of assets till the date of commencement of commercial use of the asset. All other borrowing costs are charged to the Profit and Loss Account. 4.1.10 Retirement Benefits Liability towards gratuity payable on death/retirement of employees is accrued based on an actuarial valuation, and covered by funding/premium as determined by Life Insurance Corporation of India. Provision for the benefit of leave encashment to the employees as per Company's policy is based on an actuarial valuation as of the balance sheet date. 4.1.11 Foreign Currency Transactions Transactions in foreign currency are converted at the exchange rate prevailing at the date of the transactions. Foreign currency monetary assets and liabilities not covered by forward exchange contracts are restated at the year end rates and the resultant gains or losses are recognised in the Profit and Loss Account, except exchange differences arising on settlement and/or translation of foreign currency liabilities relating to acquisition of fixed assets which are adjusted against the carrying costs of respective fixed assets. In respect of foreign branches, all revenues, expenses, monetary assets/liabilities and fixed assets are accounted at the exchange rate prevailing on the date of the transaction. Monetary assets and liabilities are restated at the year end rates and resultant gains or losses are recognised in the Profit and Loss Account. Gains and losses on foreign exchange forward contracts are recognised in the Profit and Loss Account over the life of the contract, except in respect of liabilities incurred for acquiring fixed assets, in which case such difference is adjusted to the carrying amount of the respective fixed assets. Any profit or loss arising on cancellation of a forward contract is recognised as income or expense for the period. 4.1.12 Miscellaneous Expenditure Expenditure in respect of issue of shares, pre-incorporation and other preliminary expenses, is written-off over a period of 10 years from the year in which these are incurred. 4.1.13 Taxation Provision is made for current income tax liability based on the applicable provisions of the Income Tax Act 1961, for the income chargeable under the said Act and as per the applicable overseas laws relating to the foreign branch. The Company provides for deferred tax using the net liability method based on the tax effect of timing differences resulting from recognition of items in the financial statements. The deferred tax charge or credit is recognized using the tax rates and tax laws that have been enacted or substantially enacted by the balance sheet date. 4.1.14 Leases Assets acquired under finance leases are recognised as Asset and a Liability at the lower of the fair value of the leased assets at inception of the lease and the present value of minimum lease payments. Lease payments are apportioned between the finance charge and the reduction of the outstanding liability. The finance charge is allocated to periods during the lease term so as to produce a constant periodic rate of interest on the remaining balance of the liability.
Disputed demands in respect of Income tax Rs.Nil (Previous year Rs. 43.26 Million); Entry tax Rs.106.06 Million (Previous year Rs. 91.72 Million); Service tax Rs.60.87 Million (Previous year Rs. Nil); Excise duty Rs.0.11 MIllion(Previous year Rs. Nil) and Custom duty Rs.140.71 Million (Previous year Rs. Nil). Claims against the Company not acknowledged as debts - Rs 1.47 Million (Previous Year Rs. 7.34 Million).
4.2.2 Capital Commitments Estimated value of contracts remaining to be executed on capital account and not provided for (net of advances)-Rs.2245.48 Million (Previous Year Rs.1438.70 Million). 4.2.3 Lease Obligations Future obligations for rentals under operating leases amount to Rs. 146.69 Million (Previous year Rs. 16.57 Million). The total lease payments recognised in the statement of profit and loss account amounting to Rs. 21.35 Million (Previous year Rs. 20.90 Million) Future obligations for rentals under finance lease arrangement for plant and machinery amount to Rs. Nil (Previous year Rs. 1.90 Million). Reconciliation of minimum lease payments and their present value in respect of vehicles taken on lease, is as under Present value of Minimum Lease payments (Rs) Amount paid upto 31.3.2004 Amount payable not later than one year Amount payable later than one year but not later than five years Total Previous year 2,579,558 994,009 2,646,019 6,219,586 4,299,025 minimum lease payments (Rs) 1,587,512 667,747 2,312,022 4,567,281 2,641,606 Lease charges (Rs) 992,046 326,262 333,997 1,652,305 1,657,419
The total cost of the vehicles and their carrying amount as at 31st March 2004 are Rs. 4,649,682 (Previous Year Rs.3,035,876) and Rs.2,752,558 (Previous Year Rs.1,795,860) respectively. 4.2.4 Movements in Other Investments 2003-04 Current Investments (Unquoted) (Mutual Fund Units of the Face value of Rs. 10 each acquired/sold during the year) Total 4.2.5 Taxation Provision for taxation has been made based on Minimum Alternate Tax as applicable to the company for the current year in accordance with the relevant provisions of the Income Tax Act, 1961. During the year ended 31.03.2003, based on expert opinion obtained, the deferred tax liability was considered at nil, in view of the exemption available to the undertakings of the company under Income Tax Act, 1961, the computation / determination of such tax liability being measured in the proportion of profits of the undertakings from domestic operations in section 10A/10B of the said act in accordance with the expert opinion obtained to that effect. The management has made a review of the matter and sought a fresh opinion as regard the interpretation of ASI-5 read with AS-22 'Accounting for Taxes on Income' issued by the Institute of Chartered Accountants of India; and based thereon and as a prudent measure decided to provide for the deferred tax liability upto the year 2003-04. Deferred tax liability is net of deferred tax asset of Rs. 860,126,966 on account of losses to be setoff against taxable profit in future. Based on its existing and potential business in the near future, including projections / profitability the management is virtually certain of such setoff of the unabsorbed losses; on which assertion the auditor have placed reliance. Birla Sun Life Mutual Fund Prudential ICICI Mutual Fund SBI Mutual Fund 51,025,506 22,650,584 4,755,111 78,431,201 550,316,573 285,219,588 50,038,012 885,574,173 21,209,115 11,640,524 -32,849,639 225,000,000 160,000,000 -385,000,000 No. Cost (Rs.) 2002-03 No. Cost (Rs.)
Note: Due to the issue of bonus Shares during the year 2003-04, the Earnings Per Share for financial year 2002-03 has been recomputed/restated. 4.2.10 Secondary segment information (by Geographic segments)
Significant Accounting Policies and Notes of the subsidiaries: A. Glyphics Media Inc. i) Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting periods. Actual results could differ from those estimates. ii) iii) Inventories Inventories stated at the lower of cost or market, consist of optical and magnetic storage media held for resale. Cost is determined on a first-in, first-out basis. Income taxes Deferred income tax assets and liabilities arise from temporary differences associated with differences between the financial statement and tax basis of assets and liabilities, as measured by the enacted rates which are expected to be in effect when 'these differences reverse. Deferred tax assets and liabilities are classified as current and non-current, depending on the classification of the asset and liabilities to which they relate. Deferred tax assets and liabilities not related to an assets or liabilities are classified as current or non-current depending on the periods in which the temporary differences are expected to reverse. The principle type of temporary difference between assets and liabilities for financial statements and tax returns results from a net operating loss carryforward. B. European Optic Media Technology GmbH i) General European Optic Media Technology was incorporated in Erfurt, Germany on January 30, 2003. The Company has its registered office at Maiozerhofstrabe 12, 99084 Erfurt, Germany. The object of the company are the pan-European trade and production of data media. The Company may conduct all business which directly or indirectly promotes its objects or which furthers the developments of its product. The first financial year begun on 30th January 2003 and terminated on 31st March 2004. Pursuant to section 316 of the German Commercial Code, no audit is required under German Law as the Company does not fulfill during the year 2003 the criteria's specified therein.
6. 7.
Previous Years' Figures Previous years' figures of the group entities have been rearranged/ recast/ regrouped wherever considered necessary. Schedules 1 to 19 are annexed to and form an integral part of the Consolidated Balance Sheet as at 31.3.2004 and the Consolidated Profit and Loss Account for the year ended on that date.
For K. C. Khanna & Co. Chartered Accountants. Nitin K. Jain Partner Membership No 83084 Place: New Delhi Date: June 18, 2004
Cash and cash equivalents comprise: Cash, Cheques / Drafts and imprest balances with employees Fixed Deposits Balance with Scheduled Banks 115.27 6,988.23 896.62 8,000.12 Notes: 1 2. 3 4 The above Cash flow statement has been prepared under the indirect method set out in AS-3 'Cash Flow Statements' issued by the Institute of Chartered Accountants of India Interest paid is exclusive of and purchase of Fixed Assets is inclusive of interest capitalised Rs. 21.15 Million (Previous Year Rs. 68.71 Million) Previous year's figures have been regrouped and recast wherever necessary to conform to the current year classification Following non cash transactions have not been considered in the cash flow statement 5 Tax deducted at source Assets acquired on credit/lease/hire purchase 33.63 2,122.10 588.84 2,744.57
Cash and cash equivalents include Rs. 5,709,205: Previous year Rs. 5,382,909 which are not available for use by the Company. (Refer schedule 10 in the accounts)
As per our report of even date For K. C. Khanna & Co. Chartered Accountants. Nitin K. Jain Partner Membership No 83084 Place: New Delhi Date: June 18, 2004
NOTICE
Notice is hereby given that the 21 Annual General Meeting of the company will be held on Monday, 26 July, 2004 at 9.30 A.M. at FICCI Golden Jubilee Auditorium, Federation House, Tansen Marg, New Delhi-110001 to transact the following business: 1. 2. 3. 4. 5. To receive, consider and adopt the audited Balance Sheet as at 31 March 2004, Profit and Loss Account for the year ended on that date and the Reports of the Directors and Auditors thereon. To declare dividend on Equity Shares of the company. To appoint a Director in place of Mr. Ratul Puri, who retires by rotation and being eligible, offers himself for re-appointment. To appoint a Director in place of Mr. Harnam D Wahi, who retires by rotation and being eligible, offers himself for re-appointment: To consider and, if thought fit to pass with or without modification(s), the following resolution as a Special Resolution: RESOLVED THAT M/s. Price Waterhouse, Chartered Accountants, be and are hereby appointed Auditors of the company, in place of M/s. K.C. Khanna & Co., Chartered Accountants, the retiring Statutory Auditors, to hold office from the conclusion of this Annual General Meeting until the conclusion of the next Annual General Meeting and that they may be paid the remuneration which may be decided by the Board of Directors/ Audit Committee of the Board of Directors of the company. 6. To consider and, if thought fit to pass with or without modification(s), the following resolution as an Ordinary Resolution: RESOLVED THAT in accordance with the provisions of Sections 198, 269 & 309 read with Schedule XIII and other applicable provisions, if any, of the Companies Act, 1956, and Articles of Association of the company, consent of the company be and is hereby accorded to increase the remuneration of Mr. Deepak Puri, Managing Director of the company, for the financial year 2004-05, to take on effect from 1 April, 2004, to an amount the details of which are given in the Explanatory Statement annexed hereto. FURTHER RESOLVED THAT where in any financial year during the currency of tenure of Mr. Deepak Puri as Managing Director, the company has no profits or its profits are inadequate, then remuneration may be paid to him in accordance with the provisions of Section II of Part II of Schedule XIII of the Companies Act, 1956 at that time. FURTHER RESOLVED THAT the Board of Directors of the company or any committee thereof be and is hereby authorized to do all such acts, deeds and things as in its absolute discretion it may think necessary, expedient or desirable and to settle any question or doubt that may arise in relation thereto in order to give effect to the foregoing resolution and to amend, alter or otherwise vary the terms and conditions of appointment of Mr. Deepak Puri, including his remuneration provided such remuneration does not exceed limits prescribed under the provisions of the Companies Act, 1956 and any statutory modifications or re-enactment thereof or any other guidelines relating to managerial remuneration as may be notified by the Government of India from time to time as may be considered by it to be in the best interest of the company. 7. To consider and, if thought fit to pass with or without modification(s), the following resolution as an Ordinary Resolution: RESOLVED THAT in accordance with the provisions of Sections 198, 269 & 309 read with Schedule XIII and other applicable provisions, if any, of the Companies Act, 1956, and Articles of Association of the company, consent of the company be and is hereby accorded to increase the remuneration of Mr. Ratul Puri, Executive Director of the company, for the financial year 2004-05, to take on effect from 1 April, 2004, to an amount the details of which are given in the Explanatory Statement annexed hereto. FURTHER RESOLVED THAT where in any financial year during the currency of tenure of Mr. Ratul Puri as Executive Director, the company has no profits or its profits are inadequate, then remuneration may be paid to him on the basis of effective capital of the company calculated in accordance with the provisions of Section II of Part II of Schedule XIII of the Companies Act, 1956 at that time. FURTHER RESOLVED THAT the Board of Directors of the company or any committee thereof be and is hereby authorized to do all such acts, deeds and things as in its absolute discretion it may think necessary, expedient or desirable and to settle any question or doubt that may arise in relation thereto in order to give effect to the foregoing resolution and to amend, alter or otherwise vary the terms and conditions of appointment of Mr. Ratul Puri, including his remuneration provided such remuneration does not exceed limits prescribed under the provisions of the Companies Act, 1956 and any statutory modifications or re-enactment thereof or any other guidelines relating to managerial remuneration as may be notified by the Government of India from time to time as may be considered by it to be in the best interest of the company. 8. To consider and, if thought fit, to pass with or without modifications, the following resolution as a Special Resolution: RESOLVED THAT pursuant to Section 31 and other applicable provisions, if any, of the Companies Act, 1956, the following existing Articles of Association of the company be and are hereby amended by addition/deletion/substitution of the following Articles at suitable places as mentioned hereinafter: 1. ARTICLE 1 (a) The definition of Shares in Clause 1 of Article 1 shall be amended to read as follows:Shares means the equity and voting share capital of the company, including Global Depository Receipts, American Depository Receipts or such other similar instruments and the underlying Equity Shares in relation thereto, at a par value of Rs. 10 per share, and shall, for the avoidance of doubt, include the Warrants provided that in relation to Articles71-73, 75 and 82-85, the term Shares shall not include Global Depository Receipts, American Depository Receipts or such other similar instruments or Warrants, to the extent these instruments do not carry, or the holders of these instruments do not enjoy, the right to vote.
st st st st th
(b) The following definitions shall be inserted after the definition of Debt in the Article 1 titled Further Definitions": (i) (ii) Affiliate with respect to a specified Person, means, any other Person (a) directly or indirectly Controlling, Controlled by or under common Control with such specified Person. Capital Restructuring shall have the meaning ascribed to it in Article 39B(a).
(iii) Commission shall have the meaning ascribed to it in Article 39A(e). (iv) Controlling, Controlled by, or Control, with respect to any Person, means the possession, directly or indirectly, of the power to direct or cause the direction of the management, business or policies of such Person, whether through the ownership of voting securities, by contract or otherwise, or the power to elect or appoint at least 50% of the directors, managers, partners or other individuals exercising similar authority with respect to such Person (v) Further Securities shall have the meaning ascribed to it in Article 39A(d).
(vi) Independent Directors shall have the meaning ascribed to it in Article 91A(b). (vii) Investors means collectively BIL, EIL, RIL and WIL and each one of them shall individually be referred to as an Investor. It is hereby clarified that the term Investors or Investor shall include: (a) at the option of the Investors (which shall be exercisable in writing), any of the Affiliates of the Investors holding Equity Shares in the Company, (b) all the Affiliates of BIL, EIL, RIL or WIL to whom, BIL, EIL, RIL or WIL has assigned or transferred (without notice or consent) part or whole of its rights and obligations under these Articles and other rights accruing in relation to ownership of the Shares, and (c) all third parties (other than Affiliates of BIL, EIL, RIL or WIL) to whom BIL, EIL, RIL or WIL has assigned or transferred part or whole of its rights and obligations under or pursuant to these Articles and other rights accruing in relation to the ownership of Shares, provided that such assignment or transfer: (a) relates to more than 5% shareholding in the Company, and (b) has been consented to in writing by the Promoters. (viii) Offered Shares shall have the meaning ascribed to it in Article 39B(b). (ix) Purchaser shall have the meaning ascribed to it in Article 39B(b). (x) Restricted Party shall mean the entities as agreed from time to time between the Investors, the Promoters and the Company.
(xi) Selling Promoter shall have the meaning ascribed to it in Article 39B(b). (xii) Senior Management means (a) key managerial personnel of the rank of general manager or above employed or retained by the Company or (b) any employee of the Company whose annual compensation (inclusive of all benefits) exceeds Rs. 1,000,000; (xiii) Statutory Auditor shall have the meaning ascribed to it in Article 157. (xiv) Subsidiary means a subsidiary of the Company (whether existing as on 25 March, 2004 or established in the future) and shall have the meaning as set forth in Section 4 of the Companies Act, 1956 as may be amended from time to time. (xv) Tag Along Shares shall have the meaning ascribed to it in Article 39B(b). (xvi) WIL means Woodgreen Investment Ltd. (c) The following definitions in Article 1 shall be deleted: (i) (ii) The definition of Electra Partners Mauritius Limited The definition of The Auditor or Auditor
th
(d) All references to the Auditor in the Articles shall be amended to Statutory Auditor. (e) Except for the references in Article 1 (vii), all other references to BIL, EIL and RIL (collectively) in the Articles shall be amended to the Investors and all references to each of BIL, EIL, RIL shall be referred to individually as an Investor. (f) 2. All references to Electra Partners shall be deleted.
3.
ARTICLE 39(iii) Article 39 (iii) shall be amended to read as follows:In the event the collective shareholding of the Investors or the shareholding of the Promoters is reduced below 7.5% of the issued and outstanding Shares, their respective rights as stated in these Articles shall stand terminated (except as a result of breach of these Articles by the Company or the Promoters). The obligations and liabilities of the Promoters under these Articles shall continue regardless of the extent of their shareholding in the Company.
4.
ARTICLE 39A Article 39 A shall be amended to read as follows: (a) Subject to Article 39A(b), the Investors shall have the unrestricted freedom, and right (without notice or consent to any Person) at any time, to transfer any or all of the Shares held by them to any Person. If in the case of such transfer or attempted transfer of Shares held by any Investor(s) is restricted by the Company or any Promoter (or their nominee Directors on the Board), then the Company or the Promoters, as the case may be, shall be liable to indemnify and hold harmless each of such Investor(s) in respect of all costs, liabilities and damages that may incur (including, attorneys' fees and expenses) as a result of such restriction on transfer or attempted restriction on transfer and efforts to enforce the indemnity granted hereby.
(b) The Investors shall not transfer all or any of the Shares held by them to any of the Restricted Parties, save and except if: (x) such transfer occurs through a sale of the Shares on any recognised stock exchange only if the Investors are unaware that a proposed transferee is a Restricted Party; or (y) such Transfer occurs to private equity funds, or mutual funds or other institutional investors only if the Investors are unaware that a proposed transferee is a Restricted Party, or (z) such Transfer is effected after the written consent of any of: (i) Mr. Deepak Puri, or (ii) Mr. Ratul Puri, or (iii) any of their heirs. The Parties may add to or delete from the list of Restricted Parties from time to time by mutual agreement. (c) The Promoter(s) and the company agree that they shall provide and extend all assistance requested by any Investor in procuring any approval from any governmental authority in the exercise of its rights under this Article 39A, including providing any documents required for such purpose. (d) (i) Subject to applicable laws and the execution of confidentiality agreements (as are customary in such transactions), the Promoters and the company agree and undertake to provide all reasonably necessary assistance to enable any potential purchaser, identified by the Investors to purchase all or part of the Shares held by the Investors, to carry out a due diligence review of the company as may be generally required or reasonably requested by any such potential purchaser. (ii) The company and the Promoters agree and undertake that upon receipt of a written request from the Investors informing the company of the Investors' decision to sell whole or part of the Shares then held by the Investors (including by way of one or more privately negotiated transaction(s) or by way of public offer(s) of securities to be listed on a stock exchange in India or abroad, or a combination thereof, at the Investors' sole option), the company and the Promoters shall, within four months of receiving such a request, make reasonable efforts, subject to applicable laws, to facilitate the sale, including but not limited to preparing and signing the relevant offer documents, conducting road shows, entering into such documents, providing all necessary information and documents necessary for preparing the offer document, obtaining such regulatory or other approvals and doing such further reasonable acts or deeds as may be necessary to effect such a sale by the Investors. Further, the company agrees to comply with all the procedures and execute documents in each case as are customary in transactions of such nature. (iii) The company and the Promoters agree that the Investors shall be entitled to make one or more requests for sale of their Shares under this Article 39A(d), either in whole or in part, and the company and the Promoters shall comply with the requirements of this Article 39A(d) in respect of each such request. (iv) For the purpose of this Article 39A(d), the Investors shall have the sole right to determine the nature of securities to be offered and the price for such offering. The stock exchange(s) on which the securities shall be listed and the appointment of an investment bank as book runner for the offering shall be mutually agreed between the Promoters, Investors and the company. In the event that the company, the Promoters and the Investors do not reach an agreement with regard to the choice of stock exchange(s) on which the securities are to be listed and/or the choice of investment banker to be appointed as book runner for the offering, the Investors shall have the option, at their sole discretion, to (a) require the listing of the securities on any one of the following stock exchanges: Singapore Stock Exchange, London Stock Exchange or Luxembourg Stock Exchange, and (b) appoint any one or more of the following investment banks as book runner(s) for the offering: (i) Credit Lyonnais, Merrill Lynch, Citigroup, Morgan Stanley, Kotak Mahindra, or UBS Warburg, or (ii) the Affiliates or joint ventures, in India or abroad, of the aforesaid entities. It is hereby clarified that the Investors shall have the right to appoint, at their sole discretion, any investment bank(s) as a member(s) of the syndicate, co-lead manager(s) or other advisor(s) to the offering. The costs and expenses in respect of such sale of securities shall be borne by the Investors in the same proportion that the securities sold by the Investors bears to the total securities that are sold in the offering under this Article 39A(d). Where the securities sold in such offering consist solely of Shares sold by the Investors, then the Investors shall bear all the expenses and costs related to such offering. (v) In the event that the company issues American Depository Receipts, Global Depository Receipts or such other similar instruments (the Further Securities) that are listed or are to be listed on any stock exchange, then subject to applicable laws, upon written request by the Investors, the company shall re-classify, as may be required, and list the Shares held by the Investors on the same date (or at a future date, if requested in writing by the Investors) and on the same stock exchange(s) on which listing of the Further Securities occurs. The company's obligations to list the Shares held by the Investors under this Article 39A(d)(v) shall exist irrespective of whether the Investors sell their Shares pursuant to such listing or not. (e) In the event that the company files with the United States Securities and Exchange Commission (Commission), a registration statement for the company's securities: (i) at the Investors' written request, the company shall cover in such registration transfers of all Shares and Warrants (including by means of any distribution to the limited or general partners of any Affiliates of the Investors) on behalf of the Investors and any permitted transferees. The expenses of preparation and filing of such registration statement and the fees/commission payable to the underwriters appointed shall be borne by the Investors in the same proportion that the securities transferred by the Investors under this Article 39A(e) bears to the total securities that are registered with the Commission as part of the offering. Upon filing the registration statement, the company will use its best efforts to cause the registration statement to be declared effective by the Commission and to keep the registration statement effective with the Commission so long as necessary under applicable law to permit the transfer of the securities by the Investors; (ii) if the Investors choose not to effect registration of the Shares and/or Warrants held by the Investors at the time of registration by the company of its securities, then the company shall be obligated to register the Shares and/or warrants held by the Investors at any later date upon written request of the Investors. If the Investors choose to register their Shares and/or warrants at a later date and at such date: (x) no other securities of the company are being registered, then the expenses of such registration shall be borne solely by the Investors, or (y) if other securities of the company are being registered, then the expenses for such registration shall be borne by the Investors in the same proportion that the securities registered by the Investors bears to the total securities that are registered at such date. (iii) if the company lists its securities on NASDAQ, the New York Stock Exchange or such other exchange, upon written request by the Investors, the company shall be obligated to list the Shares held by the Investors on the same date (or at a future date, if requested in writing by the Investors) and on the same stock exchange(s) on which listing of the securities takes place; and
(iv) the company's obligations as regards listing/registration under this Article 39A (e) shall exist irrespective of whether the Investors sell their Shares pursuant to such listing/registration or not. 5. ARTICLE 39B (a) Article 39B (a) shall be substituted with the following: (i) The Promoters may freely transfer, in whole or in part, without any restriction including without complying with the provisions of Article 39B (a)(ii) below or Article 39B (b), such number of Shares held by them that are in excess of 17,000,000 Shares, and provided that the Promoters continue to hold 17,000,000 or more Shares following any such transfer. For the avoidance of doubt, it is clarified that the inter-se transfer of any Shares amongst the Promoters shall be exempt from any restriction provided that the Promoters give written notice to the Investors within 30 days of any such Transfer. (ii) In the event that the Promoters wish to effect any transfer of their Shares where either (x) such transfer would result in their aggregate shareholding in the company falling below 17,000,000 Shares, or (y) their aggregate shareholding in the company is already below 17,000,000 Shares, then each Promoter hereby covenants, undertakes and agrees that they shall not transfer any Shares held by them, without for each such transfer: (x) the prior written consent of the Investors, and (y) complying with the provisions of Article 39B (b). (iii) In the event that the company undertakes any form of restructuring of its share capital (Capital Restructuring), including, but not limited to: (i) consolidation or subdivision or splitting of its Shares; (ii) issue of bonus Shares; (iii) issue of Shares in a scheme of arrangement (including amalgamation or de-merger); (iv) reclassification of Shares or variation of rights, into other kinds of securities, then the number of Shares of 17,000,000 referred to in Article 39B(a)(i) and (ii)above and Article 39B(b), or the number of Shares of 10,000,000 referred to in Article 39B(b) , as the case may be, shall be proportionately adjusted to ensure that the aggregate shareholding of the Promoters relative to the other shareholders of the company after the occurrence of such Capital Restructuring is not different from their aggregate shareholding relative to the other shareholders of the company as it existed prior to the occurrence of such Capital Restructuring. 6. ARTICLE 39B (b) Article 39B (b) shall be substituted with the following new clause:(i) If any Promoter(s) (such Promoter(s), the Selling Promoter(s)) desire to sell any number of Shares held by such Person to any other Person, then the Selling Promoter(s) shall, prior to completing such sale send a written notice to each Investor setting out all relevant details of the proposed sale including but not limited to the (1) number of Shares proposed to be transferred (the Offered Shares), (2) the name and address of the proposed transferee, (3) the proposed purchase price and (4) the material terms of the transfer. (ii) Within a period of thirty (30) days from the date of receipt of the notice mentioned in Article 39B(b)(i) above, the Investors, by way of written notice to, the Purchaser, Selling Promoter(s) and Mr. Deepak Puri, shall have the right to require the Selling Promoter(s) to cause the Person to whom the Selling Promoter(s) intends to sell the Shares (such Person, the Purchaser) to purchase from the Investors the Shares (excluding any global depository receipts and American depository receipts or any similar instrument unless these have been converted to the underlying shares in the company, in the event that the Purchaser is a resident of India) owned by the Investors as a condition precedent to the completion of the sale and purchase between the Selling Promoter(s) and the Purchaser. The Investors shall provide notice to the Selling Promoter(s) setting out the number of Shares (the Tag Along Shares) in respect of which they propose to exercise the tag along rights as set out in this Article 39B(b). (iii) Subject to the provisions of Articles 39B (b)(iv) and 39B(b) (v) below, within a period of thirty (30) days from the date of receipt of the notice from the Investors, the Selling Promoter(s) shall cause the Purchaser to acquire the Tag Along Shares offered for sale by the Investors. The Investors shall be paid the same price per Tag Along Share and the sale shall be effected upon the same terms and conditions as are received by the Selling Promoter(s), provided that the only representation that the Investors may in this case be required to provide shall be limited to the title of the Shares being sold. The Selling Promoter(s) shall not complete the sale of any of their Shares unless the Purchaser has purchased the Tag Along Shares from the Investors in accordance with the provisions of this Article 39B(b). (iv) Where (A) the Promoters' aggregate shareholding in the company is equal to or less than 17,000,000 Shares but equal to or greater than 10,000,000 Shares as on the date that the Selling Promoter(s) provides notice in Article 39B(b) (i) above, and (B) any proposed Transfer of Shares would not result in the Promoters' aggregate shareholding in the company falling below 10,000,000 Shares, then in the event the Purchaser is unwilling or unable to acquire all the Shares proposed to be sold by the Selling Promoter(s) and the Tag Along Shares, then the number of Shares to be sold by the Selling Promoter(s) and the Investors to the Purchaser shall be calculated as follows: (a) the Shares to be sold by the Selling Promoter(s) to the Purchaser shall be: = XxZ Y where: X = Total number of Shares held by the Promoters as on the date that the Selling Promoter(s) provides notice in Article 39B(b) (i) above Y = Total number of Shares held in the aggregate by the Promoters and the Investors as on the date that the Selling Promoter(s) provides notice in Article 39B(b) (i) above Z = Offered Shares (b) The Shares to be sold by the Investors to the Purchaser shall be the difference between the Offered Shares and the Shares to be sold by the Selling Promoter(s) to the Purchaser calculated in accordance with Article 39B(b)(iv)(a) above. For the purpose of this Article 39B(b)(iv), the Investors agree that Global Depository Receipts, American Depository Receipts or such similar instruments shall be included in the Tag Along Shares only if the Purchaser is desirous of purchasing the Global Depository Receipts, American Depository Receipts or such similar instruments, failing which such instruments may be included in the Tag Along Shares only if they are converted into Equity Shares of the company.
(v)
Where the Selling Promoter(s) wish to effect any transfer of their Shares where either (A) such transfer would result in their shareholding in the company falling below 10,000,000 Shares, or (B) the Promoters' shareholding in the company is already less than 10,000,000 Shares as on the date that the Selling Promoter(s) provide notice in Article 39B(b) (i) above, then the Investors shall have the right to transfer all of the Tag Along Shares (subject to a maximum of the number of Offered Shares) and the Selling Promoter(s) shall ensure that all such Tag Along Shares are purchased from the Investors."
7.
ARTICLE 39B (c) and (d) Article 39B (c) and (d) shall be deleted
8.
ARTICLE 67A(a) Article 67A(a) shall be substituted with the following new clause : The quorum for a general meeting of the shareholders of the company shall be the presence in person of at least 5 members; provided, however, no obligation of the company or any of its Subsidiaries will be entered into, no decision or determination will be made and no action will be taken by or with respect to the company or any of its Subsidiaries in respect of any of the matters listed in Article 117C(b), unless at least one representative of the Investors (collectively) and one representative of the Promoters (collectively) is either: (A) present and at a properly constituted general meeting of the company gives his/ her approval and authorization to such action, or (B) gives his/ her consent in writing to the company prior to the general meeting at which such action is to be considered.
9.
10. ARTICLE 90A Article 90A shall be deleted 11. ARTICLE 91A(b) Article 91A(b) shall be substituted with the following new clause: (i) In addition to the existing independent Directors, the company agrees to appoint three (3) new independent directors (the Independent Directors) on the Board by September 30, 2005 in accordance with the following schedule: (a) the first such director shall be appointed not later than September 30, 2004;
(b) the second such director shall be appointed not later than March 31, 2005; and (c) (ii) the third such director shall be appointed not later than September 30, 2005.
All the Independent Directors shall be nominated by the Promoters and appointed after due consultation with, and after obtaining the prior written consent of, the Investors. The Promoters shall provide, in writing, the names of three individuals for each Independent Director to be appointed. The Investors shall exercise their rights of (i) choosing an Independent Director from the names suggested, or (ii) disapproving all the names suggested, within 30 days from the date of intimation of the names by the Promoters. In the event the Investors do not approve of the persons identified by the Promoters, the Promoters shall, within 6 weeks from the date of intimation of such disapproval by the Investors, identify and provide the names of three other persons to the Investors for their consent. This process shall be followed until the Investors provide their consent to the persons identified by the Promoters. The process, as provided in this Article 91A(b)(ii), shall be followed separately for the appointment of each Independent Director in accordance with Article 91A(b)(i)(A)-(C). The Promoters and the Investors shall vote the Shares held by them to elect and appoint the Independent Directors that are chosen pursuant to this Article 91A(b)(ii).
(iii) In the event that any or all of the Independent Director(s) appointed as aforesaid, cease for any reason, to be a Director of the company, the company shall immediately appoint such number of Independent Director(s) in accordance with this Article, with the prior written consent of the Investors and the Promoters, as is required to replace such number of Independent Director(s), within 6 (six) months of the Independent Director(s) ceasing to be a Director. (iv) For the purpose of these Articles, it is hereby expressly stated that the term Independent Director shall have the same meaning as under the applicable law in force from time to time. (v) In the event that the Independent Directors cannot be appointed in the manner specified in Article 91A(b)(i) above, on account of the failure of the Promoters and the Investors to agree to the nominees suggested, it shall not be deemed to be a breach of this Article 91A(b) by the Promoters and/or the company, provided that the Promoters/company have duly complied with their obligations under Article 91A(b). 12. ARTICLE 91A(c) Article 91A(c) shall be substituted with the following new clause: The (i) Investors shall collectively have the right to appoint at least 1 (one) member, and (ii) Promoters shall collectively have the right to appoint at least 1 (one) member, on every committee of the Board of the company which is in existence as on 25 March, 2004 and which may be constituted by the Board from time to time. 13. ARTICLE 91A(e) A new Article 91A(e) shall be added: All the rights of the Investors and the Promoters in Article 91A with respect to appointment of Directors on the Board and each committee shall apply to each of the Subsidiaries in the same manner as such rights apply to the company. 14. ARTICLE 105A Article 105A shall be deleted.
th
15. ARTICLE 107A(a) Article 107A(a) shall be renumbered as Article 107A and Article 107A(b) shall be deleted. 16. ARTICLE 117C (b) First paragraph of Article 117C (b) shall be amended to read as follows: Notwithstanding any other provisions of these Articles to the contrary, (and notwithstanding that any such matter may be adopted by the Board by passing of resolutions by circulation), no obligation of the company or any of its Subsidiaries will be entered into, no decision or determination will be made and no action will be taken by or with respect to the company or any of its Subsidiaries in respect of any of the following matters, unless at least one Director nominated by the Investors and a Director nominated by the Promoters (A) is present and at a properly constituted meeting of the Board gives his/her approval and authorisation to such action (or, in the case of resolutions by circulation, at least one Director nominated by the Investors and a Director nominated by the Promoters has approved and authorised such resolutions in writing) or (B) has given his/her consent in writing to the Board prior to the Board meeting at which such action is to be considered: (i) (ii) the entering into of, an amalgamation, merger or consolidation with any other body corporate, or Person or a de-merger, arrangement or compromise; the taking of any steps to wind-up or terminate the corporate existence, filing for bankruptcy or as a sick company or entering into any arrangement with the creditors; (iii) acquisition of any business, creation of or entering into of any joint venture or partnership and the creation of or investment in any Subsidiary of the company or other forms of investments. (iv) the transfer (including any lease or exchange) of assets of the company to any Person of a value and amount aggregating more than Rs.200 million on a cumulative basis in any Financial Year; (v) incurring or committing to incur any capital expenditure from acquisition of assets or otherwise of a value and amount aggregating more than Rs.300 million on a cumulative basis in any Financial Year, except if a nominee Director of any Investor had accorded their consent on the resolution approving the Capital Expenditure Budget for such Financial Year; (vi) any increase, reduction, buy back, modification or alteration of the authorized or issued share capital of the company, including the issue of Shares, convertible preference shares, non-voting shares, warrants, options, convertible debentures or other instruments or securities which may be converted into Shares and or which accord the holder voting rights in the company; (vii) any agreement with or commitment to or any transaction with any Promoter or any Investor or any associate, relative or Affiliate of any Promoter or of any Investor; (viii) any amendments to the company's Memorandum of Association or Articles of Association, including any increase in the number of Directors on the Board; (ix) appointment of the Chief Financial Officer of the company; (x) appointment or removal of Senior Management;
(xi) the appointment or removal of the Statutory Auditor or internal auditor of the company; (xii) the appointment or removal of the Managing Director (other than Mr. Deepak Puri or Mr. Ratul Puri) or the CEO/COO; (xiii) approval or amendment of the Business Plan; (xiv) commencement of any business other than the Business or any other business conducted by the company as of June 1, 2000; (xv) any action or commitment whereby the ratio of the company's Debt to the Equity of the Company's shareholders exceeds 1.5:1 at any time; (xvi) settlement of any litigation or dispute between the company or any Person arising out of the same cause of action where the settlement amount exceeds Rs.20 million in the aggregate value; (xvii) changes in the material accounting or taxation policies of the company; (xviii) giving of any security or guarantee to any Person of an amount aggregating more than Rs.10 million on a cumulative basis in any Financial Year; (xix) declaration or payment of any dividend in a Financial Year in excess of the lower of (a) Rs.3 per Share or (b) 20% of the profits of the company after deduction of all taxes payable; (xx) any investment by the company (by way of a loan, advance, deposit or otherwise given by the company to any Person) of a value and amount aggregating more than Rs.100 million on a cumulative basis in any Financial Year, or any such investment by the company of a value and amount aggregating more than Rs.50 million on a cumulative basis in any Financial Year which is made in favour of any one Person (including its Affiliates). For avoidance of doubt, such investment excludes: (a) deposits made by the company with any one or more of the banks agreed between the Promoters and the Investors, provided that the aggregate deposits with certain banks, as may be agreed upon by the Promoters, company and the Investors, shall not exceed either Rs. 500 million or Rs. 200 million, as may be specified; (b) purchase of Government of India securities; (xxi) giving of or agreeing to give any loan, advance or debt of a value or amount aggregating more than Rs.50 million on a cumulative basis in any Financial Year, except if an advance was given in connection with a capital expenditure which was approved by a nominee Director of any Investor on a resolution approving the Capital Expenditure Budget; (xxii) agreeing to any swap agreement, cap agreement, collar agreement, futures contract, forward contract, derivative transaction or similar arrangement with respect to interest rates, currencies and securities, except the hedging contracts entered into in the ordinary course of business consistent with past practice of the company;
(xxiii) trading, or agreeing to trade, in securities of any nature and kind whatsoever; (xxiv) calling or convening a general meeting of the shareholders of the company to consider any matter, directly or indirectly, relating to any of the foregoing; (xxiv) any agreement or commitment to do any of the foregoing. 17. ARTICLE 117C A new Article 117C (c) shall be inserted after Article 117C (b): (i) It is hereby clarified that if any of the matters specified in Article 117C(b) require the approval of the shareholders of the company at a general meeting, then no obligation of the company or any of its Subsidiaries will be entered into, no decision or determination will be made and no action will be taken with respect to the company or any of the Subsidiaries in respect of any of the matters specified in Article 117C(b) unless: (A) the authorised representative of both the Investors and the Promoters at the general meeting vote in favour of such resolution, or (B) the Investors and the Promoters give their consent in writing prior to such general meeting. (ii) It is further clarified that the matters specified in Article 117C(b) shall refer not only to matters pertaining to the company but also to such matters as are applicable to any of its Subsidiaries. In case of financial limits specified in Article 117C(b), such limits shall apply to the company and all of its Subsidiaries in the aggregate and not only to the company. 18. ARTICLE 157 Article 157 shall be substituted with the following new Article: (i) The company shall, in accordance with all applicable laws, keep true and accurate books and records of account in accordance with generally accepted accounting principles consistently applied. All such books and records (and any supporting documents relating thereto) shall be kept at the company's registered office or such other mutually acceptable place as appropriate under applicable law, and shall be available at all reasonable hours for inspection and review by the Investors or their authorised representatives. At the end of each Financial Year, the books and records of the company shall be audited, and requisite financial and income statements and balance sheets prepared and certified, by the Statutory Auditor. (ii) The company's statutory audit shall be undertaken by one of the four internationally recognised firms of chartered accountants or their representatives in India (the Statutory Auditor), either individually or jointly, with any other firm of chartered accountants appointed by the company. The company and the Promoters undertake to appoint the Statutory Auditor no later than June 30, 2004. The Statutory Auditor so appointed, along with any other firm of chartered accountants that may be appointed, shall be responsible for undertaking the statutory audit for the period commencing with the financial year ending March 31, 2005. 19. ARTICLES 172 AND 173 Articles 172 and 173 shall be deleted. 20. ARTICLE 175 The first paragraph of Article 175 shall be substituted with the following paragraph: Subject to applicable laws, the company shall provide the Investors and the Promoters, unless otherwise instructed in writing by the Investors or the Promoters, as the case may be, the following on a regular basis in relation to: (i) the company and (ii) its Subsidiaries, and (iii) such other entities as may be agreed from time to time between the Investors, the Promoters and the company. 21. ARTICLE 175 A new Article 175 (j) shall be added at the end of Article 175 (i): (j) Within 15 days from the end of each calendar quarter, the following information shall be provided to the Board of Directors of the company for the relevant quarter then ended: i. ii. iii. iv. v. vi. A statement on profitability of each unit and key products of the company, containing details as agreed in writing amongst the Promoters, the Investors and the company; A statement summarizing the age-wise analysis of receivables outstanding at the end of each quarter, and the extent to which these receivables are credit-insured; Quarterly reports on operating and capital expenditure, including a comparison of actual expenditure against budgets; Minutes of the Board meetings held during the quarter; Minutes of shareholder meetings held during the quarter; Minutes of meetings of committees of the Board held during the quarter.
Provided that the rights/information set out in Articles 175(e), 175(g) and 175(i) shall be provided only in respect of the company and its Subsidiaries. 22. NEW ARTICLE NUMBER 176 A new Article shall be inserted after Article 175 and shall be numbered as Article 176. In the event that there is any change in the shareholding of any one or more Investor(s) and/or their Affiliates holding Shares in the company (Relevant Shareholder(s)) such that the Investors and/or their Affiliates and/or other Affiliates of Warburg Pincus LLC own in aggregate less than 76% of the equity shares or common voting stock of the Relevant Shareholder(s), or the Relevant Shareholder(s) ceases to be Controlled by the Investors and/or their Affiliates and/or other Affiliates of Warburg Pincus LLC (Material Change in Shareholding) then such Relevant Shareholder(s) shall not thereafter be entitled to any rights nor be subject to any of the obligations under or pursuant to these Articles with effect from the date of closing of the transactions that results in a Material Change in Shareholding of the Investor(s). Subject to Article 39(iii), such Material Change in Shareholding of a Relevant
Shareholder shall not affect the rights and obligations of the other Investors under these Articles. The Investor(s) shall, within 30 days of occurrence of any Material Change in Shareholding of a Relevant Shareholder inform the company and the Promoters of such an occurrence. The rights and obligations of the Relevant Shareholder(s) under or pursuant to these Articles shall be re-instated if at any time the Investors and/or their Affiliates and/or other Affiliates of Warburg Pincus LLC re-acquire in aggregate more than 76% of the equity shares or common voting stock or re-acquire Control of the Relevant Shareholder(s) unless the rights of the other Investors under these Articles have already ceased pursuant to Article 39(iii). Regd. Office: 43-A, Okhla Industrial Estate, New Delhi - 110 020. Date: 29th June, 2004 By order of the Board of Directors for MOSER BAER INDIA LTD Sd/COMPANY SECRETARY
NOTES 1. A MEMBER ENTITLED TO ATTEND AND VOTE AT THE MEETING IS ENTITLED TO APPOINT A PROXY TO ATTEND AND VOTE ON POLL ON HIS BEHALF. A PROXY NEED NOT BE A MEMBER OF THE COMPANY. A PROXY, IN ORDER TO BE EFFECTIVE, MUST BE RECEIVED AT THE OFFICE OF THE COMPANY'S REGISTRAR AND SHARE TRANSFER AGENT- MCS LIMITED LOCATED AT W-40, OKHLA INDUSTRIAL AREA, PHASE-II, NEW DELHI-110020 NOT LESS THAN 48 HOURS BEFORE THE COMMENCEMENT OF THE MEETING. A BLANK PROXY FORM IS ENCLOSED 2. 3. 4. The Explanatory Statement under Section 173 (2) of the Companies Act, 1956 is annexed hereto. The Register of Members and Share Transfer Books of the company will remain closed from Thursday, 22 July, 2004 to Monday, 26 July, 2004 (both days inclusive). The dividend for the year 2003-2004 as recommended by the Directors and if declared at the Annual General Meeting will be paid on or before Tuesday, 24 August, 2004, to those members whose names appear: a) b) 5. as beneficial owners as at the closure of business hours on Monday, 26 July, 2004 as per the list being furnished by National Securities Depository Limited and Central Depository Services (India) Limited in respect of the shares held in electronic form, and as members in the Register of Members of the company as at the closure of business hours on Monday, 26 July, 2004.
th th th nd th
Members holding shares in physical form are requested to notify their change of address/ residential status, if any, under their signatures and quoting respective folio nos. to the Registrar and Share Transfer Agent of the company- MCS Limited, whose office is located at W-40, Okhla Industrial Area, Phase-II, New Delhi-110020, on or before Wednesday, 21 July, 2004. Members holding shares in electronic form may update such details with their respective Depository Participants.
st
6.
The company will transfer the amount remaining unpaid in its dividend account for the year 1996-97 to the Investor Education and Protection Fund by Friday, 10 December, 2004. Those members who have not yet encashed their dividend warrants for the said year may refer the matter along with relevant details to the Company Secretary at the Registered Office of the company located at 43-A, Okhla Industrial Estate, New Delhi - 110020 latest by Monday, 15 November, 2004 to claim their unpaid dividend.
th th
7. 8. 9.
Members are requested to bring their Client ID and DP ID or Folio Numbers, as may be applicable, for easy identification of attendance at the meeting. Members / Proxies should bring the Attendance Slips duly filled in for attending the meeting. Members desirous of getting any information about the Accounts and operations of the company are requested to submit their queries addressed to the Company Secretary at least 7 days in advance of the meeting so that the information called for can be made available at the meeting.
st
10. Particulars of Directors to be appointed / re-appointed at the 21 Annual General Meeting: a. Mr. Ratul Puri Mr. Ratul Puri, who holds a Bachelor's degree in Maths and Computer Science from Carnegie Mellon University, is the Executive Director of the company. It is due to the efforts of the team led by him that your Company's optical and magnetic media are exported to 82 countries across six continents and the company has strong tie-ups with all major technology brands in the world. Mr. Ratul Puri does not hold any other Directorship. Mr. Ratul Puri retires by rotation at this Annual General Meeting and, being eligible, offers himself for re-appointment. The Board of Directors recommends this resolution for approval by the shareholders. None of the Directors except Mr. Ratul Puri himself, Mr. Deepak Puri, Managing Director and Mrs. Nita Puri, Director are concerned or interested in the resolution. b. Mr. Harnam D Wahi Mr. Harnam D Wahi is a renowned management expert. He has been associated with the company since May, 1992 and has been instrumental in the phenomenal growth of the company. Mr. Harnam D Wahi brings with him a wealth of experience and global expertise to Moser Baer India Limited, having worked in several senior positions in prestigious Indian and international organizations such as the Inchcape Group, London, where he was Chairman/ Managing Director/ Director of many highly diversified and reputed companies. Apart from being a senior committee member of a number of Trade & Industries Associations, e.g. Indian Tea Association; Port Commissioners, Calcutta; Deputy Chairman of Associated Chambers of Commerce & Industry and Deputy Chairman of Employers' Federation of India, Mr. Wahi was also President of Bengal Chamber of Commerce, Indian Jute Mills Association and Indian Rope Manufacturers Association. Mr. Wahi is a recipient of Padma Shri awarded by the President of India. Mr. Harnam D Wahi retires by rotation at this Annual General Meeting and, being eligible, offers himself for re-appointment. The Board of Directors recommends his re-appointment. Mr. Harnam D Wahi does not hold any other Directorship. He is a member of the following committees of your company:-
a) c) e)
Compensation Committee - Chairman Audit Committee - Chairman Banking and Finance Committee - Member
b) d)
11. Kindly bring your copies of the Annual Report to the meeting. 12. Memorandum and Articles of Association and all the statutory records and registers required to be kept open for inspection in terms of the provisions of the Companies Act, 1956 and the rules made thereunder, are available for inspection by the members of the company at its Registered Office between 11.00 A.M. and 1.00 P on each working day upto the meeting date and also at the place of the meeting on the meeting day. .M. 13. The investors may contact the Company Secretary for redressal of their grievances/queries. For this purpose, they may either write to her at the following address: Moser Baer India Ltd 43-A, Okhla Industrial Estate, New Delhi -110020. Tel. Nos. 51635201-51635205, 26911570-26911574 Fax Nos. 51635211, 26911860 or e-mail their grievances / queries to the Company Secretary at the following e-mail address: - shares@moserbaer.net
EXPLANATORY STATEMENT PURSUANT TO THE PROVISIONS OF SECTION 173(2) OF THE COMPANIES ACT, 1956 ITEM NO. 5 The term of M/s. K. C. Khanna & Co., Chartered Accountants is due to expire at the forthcoming Annual General Meeting. Pursuant to a resolution of the Board of Directors of the company, it has been resolved that, subject to the approval of the members in a general meeting by Special Resolution, M/s. Price Waterhouse, Chartered Accountants, be appointed as Statutory Auditors of the company, in their place. ITEM NO. 6 Mr. Deepak Puri is a co-promoter and Managing Director of the company. At the Annual General Meeting of the company held on 28 September, 2001, the shareholders had re-appointed him as the Managing Director for a period of five years at a monthly remuneration of Rs. 1,50,000 with effect from 1 September, 2001. Now, the Board of Directors is of the opinion that keeping in view his technical qualifications, thorough knowledge of various laws relating to the company's affairs and excellent administrative capabilities and experience in handling various kinds of situations and the progress made by the Company, his remuneration may be increased. Following are the details of the annual salary (payable monthly) proposed to be paid to Mr. Deepak Puri, Managing Director: Consolidated Salary, Perquisites and Performance Bonus etc.: Rs. 4,00,00,000 (Rupees Four Hundred Lacs Only) per annum. In addition to the above, he shall be entitled to receive the following: i) ii) iii) iv) v) vi) Company's contribution towards Provident Fund, Superannuation Fund or Annuity Fund will not be included in the computation of ceiling on perquisites to the extent these singly or put together are not taxable under the Income Tax Act, 1961. Gratuity as per the rules of the company, but not exceeding half a month's salary for each completed year of service. Encashment of leave at the end of tenure. Provision of car for use on company's business. Free landline telephone facility at residence along with free mobile telephone facility. Long distance personal calls to be recovered by the company. The Managing Director shall also be entitled to reimbursement of entertainment expenses actually and properly incurred in the course of business of the company. The increased remuneration would be paid only after the approval of shareholders in the Annual General Meeting. None of the Directors, except Mr. Deepak Puri himself, Mrs. Nita Puri, Director and Mr. Ratul Puri, Executive Director are concerned or interested in the resolution. This may be treated as an abstract pursuant to the provisions of Section 302 of the Companies Act, 1956. ITEM NO. 7 Mr. Ratul Puri is the Executive Director of the Company. At the Annual General Meeting of the company held on 28 September, 2001, the shareholders had appointed him as the Executive Director for a period of five years at a monthly remuneration of Rs. 2,50,000 with effect from 1 October, 2001. Now, the Board of Directors is of the opinion that keeping in view the efforts put in by him for expansion and diversification of your company's business, his remuneration may be increased. Following are the details of the annual salary (payable monthly) proposed to be paid to Mr. Ratul Puri, Executive Director: Consolidated Salary, Perquisites and Performance Bonus etc.: Rs. 2,40,00,000 (Rupees Two Hundred Forty Lacs Only) per annum. In addition to the above, he shall be entitled to receive the following: i) ii) iii) Company's contribution towards Provident Fund, Superannuation Fund or Annuity Fund will not be included in the computation of ceiling on perquisites to the extent these singly or put together are not taxable under the Income Tax Act, 1961. Gratuity as per the rules of the company, but not exceeding half a month's salary for each completed year of service. Encashment of leave at the end of tenure.
st th st th
iv) v) vi)
Provision of car for use on company's business. Free landline telephone facility at residence along with free mobile telephone facility. Long distance personal calls to be recovered by the company. The Executive Director shall also be entitled to reimbursement of entertainment expenses actually and properly incurred in the course of business of the company.
The increased remuneration would be paid only after the approval of shareholders in the Annual General Meeting. None of the Directors, except Mr. Ratul Puri himself, Mr. Deepak Puri, Managing Director and Mrs. Nita Puri, Director are concerned or interested in the resolution. This may be treated as an abstract pursuant to the provisions of Section 302 of the Companies Act, 1956. ITEM NO. 8 Pursuant to the execution of First Amendment to the Shareholders Agreement between your company, the Promoters of your Company and Bloom Investments Limited, Ealing Investments Limited, Randall Investments Limited and Woodgreen Investment Ltd. on 25 March, 2004, it has become necessary to add/delete/substitute some of the Articles of Association of the company with the ones mentioned in the aforesaid resolution. As per the provisions of Section 31 of the Companies Act, 1956, a company may alter its Articles of Association by passing a Special Resolution to this effect. The Board recommends this resolution for approval of the shareholders. None of the Directors, except Mr. Deepak Puri, Managing Director, Mrs. Nita Puri, Director, Mr. Ratul Puri, Executive Director and Mr. Rajesh Khanna, Nominee Director of Bloom Investments Limited (BIL), Ealing Investments Limited (EIL), Randall Investments Limited (RIL) and Woodgreen Investment Ltd. (WIL) (BIL, EIL, RIL and WIL are affiliates of Warburg Pincus LLC) are concerned or interested in this resolution.
th
Regd. Office: 43-A, Okhla Industrial Estate, New Delhi - 110 020. Date: 29th June, 2004
By order of the Board of Directors for MOSER BAER INDIA LTD Sd/COMPANY SECRETARY
LISTING AT STOCK EXCHANGES The Equity Shares of the company are listed at the following Stock Exchanges and the Company has paid the Annual Listing Fees for the year 2004-05 to all of these Stock Exchanges:1. The Stock Exchange, Mumbai Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai- 400001 2. National Stock Exchange of India Limited Exchange Plaza, Bandra- Kurla Complex, Bandra (East), Mumbai- 400 051. The company had applied for delisting of its shares from the Calcutta Stock Exchange Association Limited located at 7, Lyons Range, Kolkata- 700001 and has completed all the formalities in this regard. However, the Calcutta Stock Exchange Association Limited has not yet given its approval for the same.
ATTENDANCE SLIP
Annual General Meeting - Monday, 26th July, 2004 Name _________________________________________________ Name of Proxy ____________________________________________ Joint holder's name _____________________________________ Address of the member with Pin Code ________________________ _________________________________________________________________________________________________________________ Father's/husband's name (of first holder) _____________________________ Number of shares held in physical mode ____________________ Number of shares held in demat mode _______________________ Regd. Folio number* ____________________________ DP ID No**______________________ Client ID Number** ______________ * (Please note that folio no. must be provided) (To be filled in by the Member) I certify that I am a registered Member/Proxy of the registered Member of the company. I hereby record my presence at the Annual General Meeting of the company held on Monday, 26th July, 2004 at 9.30 AM at FICCI Golden Jubilee Auditorium, Federation house, Tansen Marg, New Delhi - 110 001. ______________________________________________ Meber's/Proxy's name in BLOCK LETTERS _________________________________________ Member's/Proxy's Signature **(Please note that DP ID and Client ID No. must be provided)
Note: Please fill in this attendance slip and sign at the time of handing it over for registration at the meeting place.
PROXY FORM
Annual General Meeting - Monday, 26th July, 2004 Number of shares held in physical mode ____________________ Number of shares held in demat mode _______________________ Regd. Folio number* ____________________________ * (Please note that folio no. must be provided) (To be filled in by the Member) I/We ________________________________________ of _____________________________ in the district of ______________________ being member/members of above named company, hereby appoint _________________________ of __________________________ in the disctrict of ________________________________ or failing him ________________________ of ___________________________ in the disctrict of ______________________________________________ as my/our proxy to attend and vote for me/us in my/our behalf at the Annual General Meeting of the company to he held on Monday, 26th July, 2004 at 9.30 AM at FICCI Golden Jubilee Auditorium, Federation House, Tansen Marg, New Delhi - 110 001 and at any adjournment thereof. Signed this ........................................ day of .......................... 2004
Affix Re. 1 Revenue Signature _ _ _ _ _ _ _ _ Stamp_ _ _ _ _ _ _ _ _ _ ___
DP ID No** _______________ Client ID Number**____________ **(Please note that DP ID and Client ID No. must be provided)
NOTE: THIS FORM IN ORDER TO BE EFFECTIVE MUST BE DULY STAMPED, COMPLETED AND SIGNED AND MUST BE DEPOSITED AT THE OFFICE OF THE COMPANY'S REGISTRAR AND SHARE TRANSFER AGENT- MCS LIMITED, W-40, OKHLA INDUSTRIAL AREA, PHASE II, NEW DELHI - 110 020, NOT LESS THAN 48 HOURS BEFORE THE MEETING.
43-A, Okhla Industrial Estate, New Delhi 110 020, India. Tel: + 91 11 51635201 - 07 Fax: + 91 11 51635211 Email: info@moserbaer.net