Shree Cements profit

after tax dropped

94.38 per cent.
The management is delighted.

Annual Report for the shareowners 2001-2

Why?

Shree Cement Limited

Contents
12

Corporate description

14

Drivers, vision and mission

16
The companys profit was lower as it retained profit of
Rs 2103 lacs by providing depreciation on assets as revalued
assets in the Profit and Loss Account.

Most shareholders who find that Shree

Cement reported a post tax profit of only
1.47 cr. are likely to be disappointed.

Highlights
18

10 minutes with the Joint MD

24

Enhancing value for shareholders

26

Management discussion and

analysis
41

Information technology

42

Risk management

49

Human resources development

54
We are not.

Environment report
59

60

Community development report

Directors report

68
73

Annexure to Directors report

Five year financial highlights

74

15 year financial highlights

75

Corporate Information

76

Ratios and ratios analyses

Because, in a year when most businesses became less

competitive, Shree Cement reported a 12.28 percent
improvement in its return on capital employed - from
80

16.94 percent in 2000-01 to 19.02 percent in 2001-02.

86

Corporate governance
Shareholders information

90

Auditors report

In a year when most cement manufacturers complained of thinner spreads, Shree

Cement increased its post-interest profit by 34.41 percent - from 9.33 percent to

93

12.54 percent. Inside this annual report, we have explained how we turned one of

Prompting the optimism of a considerably

the most challenging months in our existence into one of the most inspiring.

stronger 2002-3 - and beyond.

Directors Profiles
95

113

Financial section
Subsidiarys Accounts

[THE MUST DO COMPANY]

Shree Cement used the industry

trough to strengthen its business.
The company enhanced its production capacity from
20 lac tonnes per annum to 26 lac tonnes per
annum.
Since this expansion was achieved at a cost lower
than the prevailing benchmark for setting up a
greenfield project, the company protected its ability
to produce cement at one of the lowest capital costs
per tonne in India.
When the economy revives, Shree Cement will not
just be able to call more capacity into play, but at a
cost considerably lower than the prevailing industry
standard.
Resulting in more cement. And higher profits.

More
capacity
2

[THE MUST DO COMPANY]

Lower
runningcosts
Shree Cement supplemented its attractively low
capital investment per tonne with one of the lowest
manufacturing costs in the Indian cement industry.
At Shree, manufacturing expenses accounted for 82 per
cent of sales in 2001-02, much below the average in the
Indian cement industry.
Once again, the low cost was the result of scores of
initiatives across all levels within the company. Some
resulting in small savings. Some in big. But each primarily
driven by the belief that what was being done could be
done better.
For instance, Shrees successful substitution of imported
coal with domestically-sourced pet coke saved the
company Rs 25.55 cr in 2001-02. The replacement of
indigenous kiln bricks with an imported alternative saved
Shree Rs 3.94 cr during the financial year under review.
Cooler fans were configured to a higher capacity so that
heat could recuperate better. A better raw mix helped
Shree reduce the proportion of high cost limestone and
saved the company Rs 0.44 cr.
4

[THE MUST DO COMPANY]

Cutting
the fuel bill
In 2001-02, the companys fuel cost per tonne of cement
stood at Rs 171.30, lower by Rs 27.05 than in the
previous year.
In a world where fuel costs are always rising, Shree represents a
welcome change.
This reduction was the result of the companys consistent and
constructive discontent with existing practices.
Until 1999-2000, Shree imported coal from South Africa and
Indonesia. The consignment would be collected at the Kandla port
from where it would be delivered deep into Rajasthan at Beawar.
Instead of the linear strategy of looking for alternative cost-effective
sources, Shree attempted something completely lateral. It changed
the fuel source in favour of pet coke sourced from within India.
The switch was made on the following basis:
Pet coke was cheaper compared to imported coal
Pet coke possessed higher calorific value.
As a result, Shree reported a heat consumption of 694 kilocalories /
kg of clinker against the industry average of 818 kilocalories / kg of
clinker in 2001-02. Shree reduced fuel costs as a proportion of
manufacturing expenses from 21.38 per cent in 2000-01 to 18.76 per
cent in 2001-02.
6

[THE MUST DO COMPANY]

Lower
finance cost
Of all the factors of production, perhaps the most powerful and
ironically the most neglected is the cost of finance.
Not at Shree.
The companys finance team is among the sharpest in the
business. Managing funds with prudence. And maximising
returns on surpluses. With the objective of reducing the
companys total cost of production.
Before the start of 2001-02, Shrees team set out a target
to lower the companys cost of borrowing by at least three
per cent over the previous year.
These were the various initiatives entered into by the
company:
Re-negotiation in the interest rates from 19.50 per cent
in 1998-99 to 13.50 per cent on long-term borrowings
from financial institutions, leading to net savings of
Rs 17.59 cr.
Substitution of working capital demand loans with FCNR
(B) loans at low rates of interest, resulting in a coupon rate
of 10.11 percent on FCNR (B) loans of Rs 26.49 cr, leading
to savings of Rs 0.96 cr.
Placement of commercial paper worth Rs 20 cr at 8.5
per cent per annum.
As a result, Shrees weighted average rate of interest on
term loans declined from 16.32 per cent as at 30th June,
2000 to 12.78 per cent as at 31st March, 2002. The
companys weighted average rate of interest on working
capital loans reduced from 13.55 per cent as at 30th June,
2000 to 10.61 per cent as at 31st March, 2002.
So even as business grew in 2001-02, Shrees interest
outgo declined by Rs 17.08 cr and interest cover increased
to 2.85 from 2.18 in 2000-01.

[THE MUST DO COMPANY]

Stronger
company
At Shree, we believe that a soundly run business
must generate enough cash flow to strengthen the
business further.
Despite the prevailing recession in the economy in
2001-02, Shree reported a healthy cash flow of
Rs 46.74 cr.
Shree cement managed this resource with
responsibility and invested a part of it in value
enhancing assets.
For instance, in 2001-02, the company embarked on
the exercise to commission a captive 36 MW thermal
power project at a cost of Rs 120 cr. Shree placed an
EPC contract with Thermax Ltd. in September 2001.
Civil work commenced in October 2001. The project
is expected to be commissioned by December, 2002.
The power plant will do more than just ensure the
availability of uninterrupted power to Shrees
production facilities. It will provide quality power,
minimize the companys dependence on the state
electricity grid and indirectly reduce the losses arising
during unplanned downtime caused by unexpected
power cuts.
Shrees power plant, expected to save about Rs 30 cr
in its first full year of operations, is likely to post a
payback of less than four years and strengthen the
companys competitive position in the marketplace.
10

11

The spirit of Shree

Shree Cement
is one of the
most energy
efficient and
productive
cement
manufacturing
companies in
the world.
12

SIZE
The company manufactures cement through the dry process in Beawar,
Rajasthan. The company possesses two plants; the first was commissioned in
1985 with a capacity of 0.6 million tonnes, the second in 1997 with an installed
capacity of 1.24 million tonnes. Following modernization and intelligent debottlenecking, the two plants could produce 2.6 million tonnes in a year. This
made Shree the largest single-location manufacturer in north India. The
companys installed capacity accounted for 14.9 per cent of Rajasthans total
capacity in 2001-02. It was the sixth largest plant in the country.

EDGE
Shrees competitive advantage lay in its ability to consistently generate a
production in excess of its installed capacity. Shree reported a capacity
utilisation in excess of 100 percent for 15 consecutive years. In 2001-02,
Shree reported a capacity utilisation of 107 per cent: an achievement
considering that the plant encountered a number of shutdowns on account of
a shift in the companys feedstock from imported coal to indigenous pet coke.
The company expects to take cost-cutting into a higher league with a Rs 120
cr 36 MW power project expected to be commissioned by December 2002.

MARKETING
The companys plants were not located within the seven clusters in India
where the majority of cement manufacturers were located and where supply
exceeded demand. The companys plants were located in close proximity to
its primary marketing zone (Rajasthan, Delhi, Haryana, Punjab, Himachal
Pradesh and West Uttar Pradesh) and its raw material source. The companys
OPC cement is sold under the Shree Gold, Shree Super and Shree Cement
brands while its PPC equivalent is sold under the Shree Star brand. In 200203, the company will also sell under the Shree Ultra Ash free Cement and
Shree Ultra Red Oxide Cement brands.

PRODUCTS
Shree manufactured ordinary Portland cement (grey cement) and Portland
pozzolana cement (clinker-based).

PERFORMANCE
Shree posted a turnover and cash profit of Rs 397.22 cr and Rs 49.84 cr
respectively in 2001-02. The companys market capitalisation increased to
Rs 145.10 cr during the financial year under review.
As a measure of credibility, CARE accorded the companys short-term debt
the highest rating of PR1+. The companys shares are listed on the National,
Bombay and Kolkata stock exchanges. The promoters - the Bangur family,
based in Kolkata - held 59.54 per cent of the companys equity.

13

MISSION
To sustain its reputation as the
most efficient cement
manufacturer in the world.

DRIVERS

VISION

To strengthen realizations through

intelligent brand building.

PEOPLE AS

working to

what is good can

number of

PROGRESS

generate a

be made better -

strategic and

DRIVERS

sustainable

across the

business initiatives

Shree believes that

improvement.

organisation.

that generate

what is present in

14

larger and a better

the minds of

LEADERS AT

CUSTOMER

people is more

EVERY LEVEL

FOCUS

valuable than the

Shree believes in

Shree is

COMMUNITY AND

assets on the shop

creating leaders -

committed to

ENVIRONMENT

floor. All the

not just at the

deliver a superior

Shrees community

companys

organisational apex

quality of cement

concern extends

initiatives are

but at every level,

at attractively

from direct

directed to

resulting in a

affordable prices.

assistance to safe

leveraging the

strong sense of

value of this

quality of earnings.

and dependable

emotional

SHAREHOLDER

operations for its

growing asset.

ownership.

VALUE

members and the

Shree is focused

environment.

TEAMWORK

CULTURE OF

on the

Shree leverages

INNOVATION

enhancement of

effective team

Shree believes that

value through a

To register
a strong
consumer
surplus
through a
superior
cement
quality at
affordable
prices.

To drive down costs through

innovative plant practices.
To increase the awarness of
superior product quality through a
realistic and convincing
communications process with
consumers.

15

Change in the
accounting year from
June to March.
An increase in the

Receipt of NCBMs Best Electrical

A 46 per cent increase in the

return on capital

distribution network from

employed from 16.94

492 dealers in 2000-01 to

per cent in 2000-01 to

881 in 2001-02.

19.02 in 2001-02.

Receipt of the National Award for

Energy Performance and Best

Energy for the fifth consecutive

Thermal Energy Performance

year from the Ministry of Power

Award for the year 2000-01 from

for achievements in energy

the Ministry of Commerce and

conservation in the cement

Industry, Government of India.

A 18x2 MW power
project implementation
at a cost of Rs 120 cr.

sector.
An increase in the
pre-interest margin
from 17.26 per cent in
2000-01 to 19.31 per
cent in 2001-02.

Successful launch of the

Receipt of the Best Annual

Shree Ultra Ash Free and

Report Award (2000-01) from

Shree Ultra Red Oxide

the Institute of Chartered

brands.

Accountants of India, Jaipur,

with respect to sound
corporate governance and
investor transparency.

An increase in
interest cover from

A drop in the debt-equity

2.18 in 2000-01 to

ratio from 1.07 in 2000-01

2.85 in 2001-02.

to 1.03 in 2001-02.

A 34.4 per cent

increase in gross profit
as a per cent of sales

A leading 15 per cent

share of the Delhi
market.

from 9.33 per cent in

2000-01 to 12.54 per
cent in 2001-2002.

A drop in sundry
debtors from
Rs 40.82 cr in 200001 to Rs 30.03 cr in
2001-02.

16

This is what we achieved in 2001-02

17

10 MINUTES WITH THE JMD

We accelerated our

re-invention

in 2001-02

Mr Hari Mohan Bangur, joint managing director, analyses the companys improved performance

What is the big take-home for Shree Cement

were production-obsessed; the marketplace was

at the end of 2001-02?

increasingly consumer-led. We recognized that we would

have to change to enhance value for our owners.

Every organization builds up a series of habits and

20

assumptions, which become sacrosanct over time and

Change! This is exactly what we commenced in 2000-01

begin to represent the character of the organisation.

and accelerated in 2001-02. This transition was not

Depending on the nature of the practices and the

limited, it was sweeping. We analysed every process.

evolving environment around us, this character can be a

We questioned every practice. We unlearnt. We learnt.

prison or a playground.

As a result, we have created a new company. We have

When we looked within a couple of years ago, we began

inducted professionals with fresh thinking. We have

to see the first signs of a divergence between what we

given them adequate operational freedom to re-orient our

were and what the marketplace was becoming. We

methods with the best practices used by the best

19

companies within India and abroad. We have

driven through a greater use of pet-coke, a stronger retail

restructured the marketing function completely. And in

offtake and sales realization at par with the industry

the process beaten the economic slowdown with a

average. Even as the economic slowdown persisted, it is

better performance.

remarkable that Shree met these goals successfully.

THE BIG THING THAT WE DID WAS

TO PROGRESSIVELY

CHANGE

Shree Cement posted a higher cash profit by 28 per cent

To what extent did this change reflect across

the company?

in 2001-02 than in the previous year on an annualized

OUR FOCUS FROM A PRODUCTIONCENTRIC ORGANIZATION INTO A

MARKETING-CENTRIC ONE.

basis. This was absolutely commendable: this transpired

when the cement industry continued to be affected by a

Most importantly, the change was brought in by our

slowdown in the economy. Besides, Shree Cement could

people across all management tiers and functions.

not produce enough cement because it had taken a

Without their support for reform, the change would have

shutdown during the early part of the financial year under

been restricted to just a few managers or at best, just

review. And thirdly, we lost a little production during the

one department. As a result, intra-departmental

switch over from imported coal to pet coke during the

brainstorming is now a regular feature within Shree with

course of the year.

a clear action schedule. The change has transpired with

speed. Let me give you two instances: despite a strong
competitive pressure we raised our market share across

What reasons would you ascribe for the

Starting from 2000-01 and even more so in 2001-02, we

impression, Shree immediately graduated within the

all the primary markets that we served. Secondly, a

companys better performance?

re-configured our focus. We conceded that while selling

various price bands in the marketplace. In the Jaipur

number of cost reduction initiatives were driven not by

The big thing that we did in 2001-02 was to

to institutions was perhaps the easier option, it did not

market, we added Rs 4 per bag of cement in realizations

the senior engineers but by their juniors and in some

progressively change our focus from a production-centric

give us enough room in which to strengthen our brand. It

and moved within Rs 2 per bag of the market leader; in

did not give enough reason to expand our dealer

Punjab, we added Rs 2.5 per bag, this happened likewise

network. It did not give us enough scope to raise our

in Haryana and West UP as well. Over the coming years,

realizations.

these price increments will have a strong effect on the

cases, even by people who had no functional

organization into a marketing-centric one. Let me give

responsibilities across certain aspects of our working. I

you an instance of the extent to which we have

could not have visualized this to happen as fast when we

changed: for a number of years, we considered

embarked on the process of change more than a year

manufacturing to be our core competence. Since this

The result was a complete U-turn in our corporate

ago.

was so, it made sense for us to sell as much as possible

strategy: we now began to focus more aggressively on

to as few people as possible. So we sold primarily to

the retail segment than ever before. We appointed more

What other reasons were responsible for

institutions, the people who buy in bulk to build bridges,

dealers in one year than we did in the 16 years of our

Shrees improved performance?

dams, airports and residential complexes. This relieved

existence. We restructured our marketing team to reach

Immediately. At the start of 2001-02, we targeted an

us of the headache to sell in small quantities across

out to dealers quicker and service them better. We

We continued to do what we had always done well:

output of 26 lac tonnes, a cost reduction by 10 per cent

Indias retail markets.

penetrated our primary market more intensively than we

reduce costs. I can sum up the mood of the organization

had ever done earlier. We re-invented the Shree Cement

with an interesting reference: when the mile was first

logo. Thanks to these initiatives, we evolved Shree

run under four minutes in the early Fifties, the

Cement from a commodity into a brand. The result was

achievement was considered awe-inspiring. But within

reflected in the numbers: retail offtake as a percentage

the next year, 37 runners had done the same and a

of total sales increased from 50 per cent in 2000-01 to

number of them ran the distance in less than it took

about 60 per cent in 2001-02.

Bannister during his record-breaking run. There is a

Did this change reflect in the numbers?

WE HAVE CREATED A NEW

COMPANY. AND IN THE PROCESS

parallel with Shree: after we had cut costs upto a point,

How important was the brand building?

BEATEN

THE ECONOMIC SLOWDOWN WITH

A BETTER PERFORMANCE.
20

bottomline.

30

the inspiration enabled us to cut costs even more

aggressively thereafter. The result is showing in our

Let me state that positioning Shree in the mind of the

numbers: all our costs prior to the interest and

marketplace is an exercise that will continue for a number

depreciation stage dropped from 85 per cent in 1999-

of years. The change may be subtle but its impact more

2000 to 82 per cent in 2001-02 of sales, despite an

pronounced. For instance, thanks to a more favourable

increase in all costs.

21

THE TARGETS THAT SHREE CEMENT

HAS SET FOR 2002-3: A 10 PER CENT
In what way did you strengthen the

ammunition it requires to sell the increased output in the

organization for the long-term through costcutting?

marketplace.

Continuing our switch in feedstock was a momentous

Did the company raise its installed capacity?

decision in the history of our company. In doing so, we

We did. We added 0.6 million tonnes to our installed

were taking a risk of upsetting a stable production

process, we were risking losing significant output, we
were risking the bottomline of the company and we
were risking our position in the marketplace. The
experiment could well have failed and we would have
had to revert to the erstwhile process with little to show
to our shareholders. If we pulled it off in the face of

capacity at a substantially lower cost than what it would

take to go greenfield. The argument that we have faced
is: why did we not set up a new plant altogether. We
didnt for a few good reasons: if we had set up a
greenfield plant at that stage, it would have distracted
our focus from the marketplace to the manufacturing. It

formidable odds - we became the only company in India

would have set our captive power plant back, it would

to do so - it was because of the resilience of our

have postponed our drop in production costs by a couple

production team. They just wouldnt give up. But for

of years and it would have taken away the anticipated

them, the switch to pet coke would have gone down as

surplus that we can now invest and create a virtuous

a tentative experiment in the annals of the company.

cycle of growth. Besides, a strong bottomline and

HIGHER

PRODUCTION AND A 10 PER CENT

LOWER COST STRUCTURE.
HIGHER REALIZATIONS PER BAG.
AND AN INCREASE IN THE
PROPORTION OF THE RETAIL
OFFTAKE TO 65 PER CENT.

balance sheet can now support an inorganic expansion

To what extent did it succeed?

Our capacity utilisation might not have increased

22

should such an opportunity present itself.

significantly last year, but our profitability has. This

What targets has Shree Cement set for

improvement can in a large part be attributed to the

2002-03

increased use of pet coke. Nearly 90 per cent of the

A 10 per cent higher production and a 10 per cent lower

cement produced during the year was based on the pet

costs structure. Higher realizations per bag. And an

coke feedstock. The increasing use of pet coke during

increase in the proportion of the retail offtake to 65 per

the course of the year transformed our bottomline in

cent. We expect to sustain the organisations momentum

2001-02. My estimate is that in a full years working

thanks to the Governments effort to kick start

based on this new feedstock, the company should

infrastructure, low interest rates on housing, a

register a saving of Rs 30 cr. The lower cost of

consolidation in cement prices and a rise in cement offtake

production will give our marketing team just the

in the country. We definitely see better days ahead.

23

directly in the form of the dividend received

120

by them and indirectly in the form of capital

100

appreciation registered by the stock during

80

the financial year under review. TSR is

60

calculated by deducting the opening market

capitalisation from the closing market

40

capitalisation, and adding the dividend paid.

20

It is the gain expressed as a percentage of

the opening market capitalisation.

-20
-40

1998-99

1999-2000

2000-01

TSR %

2001-02

Market return %

Annual TSR
Shree Cement

Enhancing

VALUE

for shareholders

1998-99

1999-2000

2000-01

2001-02

Opening price as on 1st July

15.75

32.20

25.50

30.80

Closing price as on 30th June/ 31st March

31.90

24.65

31.45

41.65

Difference

16.15

-7.55

5.95

10.85

Add: Dividend
TSR
TSR%
Market return %

1.00

1.00

16.15

-7.55

6.95

11.85

102.54

-23.45

27.25

38.47

28.16

14.58

-28.65

1.85

Shree's shareholders enjoyed a 11.85 per cent average

Return on capital employed

TSR return across three years ending 31.03.2002,

Return on capital increased from 16.94 per cent in 2000-01

compared with 2.08 per cent in the three years ending

to 19.02 per cent in 2001-02.

30.06.2000 and a negative 8.94 per cent in the three years

Market capitalisation

ending 30.06.1999. Shree's three-year TSR% was higher

than the returns from the BSE-Sensex during the same

In 2001-02, Shree Cement posted a 32.43 per cent

period.

increase in its market capitalisation as compared to a 27.59

per cent growth recorded in the previous financial year
indicating an improved perception.

Three - Year TSR %

Shree Cement's improved performance is reflected in a

compared with the BSE-Sensex return of 1.85 per cent

higher return on employed capital, an improved Total

during the same period, an endorsement of Shree's

Price as on 1st July (three years earlier)

Shareholder Return and an increase in its market

strategies to grow its earnings over the long-term.

Price as on 30th June / 31st March

capitalisation.

Difference
Shree also registered a growth in TSR (in per cent terms)
by 41 per cent. It increased from 27.25 per cent in 2000-01

Total Shareholder Return (TSR)

24

to 38.47 per cent in 2001-02.

Add: Dividend (cumulative)

1998-99

1999-2000

2000-01

2001-02

43.60

23.20

15.75

32.20

31.90

24.65

31.45

41.65

11.70

1.45

15.70

9.45

1.00

2.00

TSR

11.70

1.45

16.70

11.45

TSR %

26.83

6.25

106.03

35.56

8.94

2.08

35.34

11.85

3.43

3.47

2.33

-5.44

Shree Cement's investors enjoyed a Total shareholder

Total shareholder return reflects the gain delivered to

AVG. TSR%

return of 38.47 per cent in the last financial period

shareholders by the company directly and indirectly:

BSE-Sensex return %

25

Management

DISCUSSION

and analysis

Nature of business

and backward integration. To maintain cash flow

equilibrium at the lowest possible cost. Work with

Shree Cement Limited is engaged in the manufacture

of cement through the dry process route in North
India. The company possesses two plants in Beawar,
Rajasthan. The state was the largest cement producing
state in India in 2001-02. Shree Cement manufactures

credit agencies for the rating of instruments to reduce

coupon rates on loans. Interact with the investing
community to enhance the companys perception.
Maintain a prudent debt-equity ratio to protect the
capacity to repay and mobilise fresh loans at low rates.

cement of two varieties - ordinary Portland cement

(grey cement) and Portland pozzolana cement (clinker-

Maintain raw material cost as a percentage of sales,

based). The company also occasionally markets clinker

inspite of rising prices and strengthen the MIS to

to cement companies.

facilitate informed decision-making.

2001-02 vs. 2000-01

Initiatives, 2001-02

In 2001-02, Shree Cement recorded a turnover of

Thanks to a continuous de-bottlenecking, upgradation

Rs 397.22 cr as against Rs 554.60 cr in 2000-01. This

and modernization, installed capacity increased by 0.6

was because 2001-02 comprised 9 working months

million tonnes in 2001-02. Production increased by

sans the peak period of April-June (July to March) as

1 per cent (annualized) inspite of stoppages in process,

compared to 12 months covered in the previous

the power factor increased from 0.95 to 0.99, power

financial year. In 2001-02, Shree Cement posted a 28

costs reduced 11 per cent while fuel costs dropped by

per cent increase in its cash profit as compared to the

5 per cent.

previous year on an annualized basis.

Through intelligent re-negotiation, the company

achieved a reduction in the average cost of borrowings

Objectives, 2001-02
Increase installed capacity from 2 million tonnes to
2.6 million tonnes, increase capacity utilisation, reduce
manufacturing costs by 2 per cent and reduce
downtime by 5 per cent over 2000-01.

for term and working capital loans. The company

substituted working capital demand loans with FCNR
(B) loans carrying low rates of interest. It placed
commercial paper worth Rs 20 cr. It syndicated a loan
of Rs 85 cr for its power project from commercial
banks at PLR. Working capital limits increased from Rs

Make funds available to finance business growth at

the lowest cost. Raise finance to fund the expansion

26

59 cr to Rs 65 cr to support a higher volume of

business during the year.

27

 Besides, the company finalised financial

period. Interestingly, cement demand has been -14

statements by the 12th of the ensuing month and

per cent, 3 per cent and 1 per cent in Japan, USA

the profit and loss account by the 9th of the ensuing

and China over the last three years while it has been

month (compared to the 13th of every month in the

much higher in India thanks to the under-penetration

previous year). For the first time in the companys

and the increasing focus on infrastructure creation.

DEMAND-SUPPLY EQUATION*

(million tonnes)

2001-02

2002-03 E

2003-04 E

2004-05 E

Domestic demand

99.00

107.90

117.60

128.20

Domestic supply (net of export)

99.03

109.00

117.00

125.00

0.03

1.10

(0.60)

(3.20)

Net surplus/ (deficit)

history, the six monthly financial results were audited

within a fortnight and submitted to the Board of
Directors. The transit period for funds from one bank

INDIAS THREE YEAR GROWTH

*figures are based on a 9 per cent growth rate

(million tonnes)

to another reduced from 1.51 days in 2000-01 to 1.26

days in 2001-02. Surplus funds were not idled for
even a day but invested in safe financial instruments.
Through an early remuneration of vendors the
company availed of cash discounts of Rs 7.94 lacs.
Ernst and Young evaluated the accounting systems
of the company.
Raw material costs increased marginally from 9.04

Particulars
Capacity
Growth %
Demand
Growth %
Capacity Utilisation%

1999

2000

2001

2002

105

109

114

130

13

80

92

90

99

15

10

78

87

82

79

THE INDIAN CEMENT INDUSTRY

GREW
9 PER CENT IN 2001-02 COMPARED
TO -2 PER CENT IN 2000-01.

Source: CMA

per cent of sales in 2000-01 to 9.63 per cent in 200102 through a stronger negotiation process with
vendors. This was achieved inspite of an increase in
prices.

Industry growth
The Indian cement industry grew 9.7 per cent in

Rationale for presence

2001-02 compared to -2 per cent in 2000-01. In 2001-

The management of Shree Cement entered the

million tonnes against 93.61 million tonnes in

business of cement in the mid-Eighties on the basis

2000-01, an 9.4 per cent increase inspired by a

of the growth opportunities for housing and

stronger government focus on housing and

infrastructure in India.

infrastructure, an excellent monsoon, a positive

02, the Indian cement industry produced 102.40

Region wise consumption / production

South India recorded the highest production across all regions in India - 29.88 million tonnes in 2001-02 compared
to 27.32 million tonnes in 2000-01, accounting for almost 29.18 per cent of the countrys offtake. North emerged
second with an offtake of 21.94 million tonnes in 2001-02 or 21.43 per cent of the Indian market. The Northern
region posted the highest capacity utilization.
2001-02

credit cycle and higher disposable income.

Installed

Large and growing market

2000-01

Production

CU %

% Share

YOY %

capacity

Installed

Production

CU %

% Share

YOY %

1.62

capacity

Size

North

23.40

21.94

93.76

21.43

12.46

21.17

19.51

92.14

20.88

South

42.91

29.88

69.63

29.18

9.38

33.43

27.32

81.71

29.24

5.48

India has 124 large cement plants owned by 57

East

21.22

16.67

78.56

16.28

9.91

19.85

15.17

76.41

16.23

145.42

companies. In 2001-02, the total installed capacity for

West

21.89

17.23

78.71

16.83

8.93

20.07

15.82

78.79

16.93

4.69

the top four cement producing countries in 2001

20.48

16.68

81.45

16.29

6.94

19.16

15.61

81.50

16.71

-34.88

were China, India, US and Japan.

cement manufacture stood at 135.03 million tonnes,

Centre

129.90

102.40

78.83

100.00

9.61

113.68

93.42

82.18

100.00

-0.62

The Indian cement industry is the second largest

producer and the third largest consumer of cement in
the world. According to a US geographical survey,

Total

11.10 per cent higher than in 2000-01. It is expected

Fast growing
The demand for cement in India has grown at nine

28

that a slower capacity addition will transpire over the

next three years - not more than 15 million tonnes -

per cent per annum over the last five years, higher

in view of weak prices and poor profits. This could

than Chinas growth rate of five per cent during the

lead to deficit for cement in the country at that time.

capacity & production figure are in million tonnes)

Definition of regions:

NORTH: Punjab, Delhi, Haryana, Himachal Pradesh, Rajasthan, Chandigarh, J&K, West Uttar Pradesh and northern parts of Madhya Pradesh
WEST: Maharashtra and Gujarat
SOUTH: Tamil Nadu, Andhra Pradesh, Karnataka and Kerala
EAST: Bihar, Orissa, West Bengal, Assam, Meghalaya and eastern parts of Madhya Pradesh.
CENTRAL: Uttar Pradesh and Madhya Pradesh.

29

Region wise growth

Industry characteristics

GROWTH % IN CEMENT CONSUMPTION

Freight accounts for 15 per cent of the delivered cost

of cement. As a result, manufacturer attempt to

Northern region
Punjab
Rajasthan
Delhi
Himachal Pradesh
Haryana
Total northern region
Western region
Gujarat
Maharashtra
Total western region
Eastern region
Bihar
Orissa
West Bengal
Total eastern region
Southern region
Andhra Pradesh
Tamil Nadu
Karnataka
Kerala
Total southern region
All India

% change
19
10
10
16
14
16

SHREE FOCUSED ON RAW MATERIAL

maximize their sales in regions close to the plants.

distances. As a result, cement is sold within regions

QUALITY

or clusters only. Even though cement is sold within

IMPROVEMENT. THE COMPANY USED

regional markets, a glut in one region adversely

ROCK BREAKER AND COMPUTERIZED

Rail is a preferred mode of transport over reasonable

affects the price economics in the adjacent markets.

18
1
6

MINING SOFTWARE

Production
Shree reported a production of 18.06 lac tonnes

5
11
25
19

during 2001-02, a marginal increase of 1 per cent on

an annualized basis over the previous year. This

Raw materials management

corresponded to a capacity utilization of 107 per cent.

Cement raw materials comprise limestone, coal,

15
2
24
2
9
10

CAPACITY UTILISATION
Year

96-97

97-98

98-99

99-00

129

118

111

116

CU(%)

00-01 01-02
119

107

Source : CMA

Particulars (Rs. cr)

gypsum, clay, iron ore and fly ash. At Shree, raw

Turnover

materials constituted almost 23 per cent of the

Raw Material Cost

companys cost of production excluding interest and

depreciation. Raw material cost as a percentage of
sales increased from 9.04 per cent in 2000-01 to 9.63

97-98

98-99

99-00

355.42 442.14

484.56

00-01

01-02

554.60 397.22

28.83

40.50

46.47

50.14

38.26

8.11

9.16

9.59

9.04

9.63

RMC as a %
of Turnover

10.00

in 2001-02. Despite a 10 per cent increase in raw

ACHIEVEMENTS

material prices, this marginal increase was attributed

Section

Unit I

Raw Mill

Unit II

Kiln

to aggressive negotiations with vendors.

Guaranteed

Best Achievement

Guaranteed

Best Achievement

210 TPH

278 TPH (Day)

300 TPH

444 TPH (Day)

244 TPH (Month)

2200 TPD

387 TPH (Month)

4073 TPD (Day)

3700 TPD

3307 TPD (Month)

5610 TPD (Day)

4614 TPD (Month)

125 TPH

188 TPH (Day)

210 TPH

149 TPH (Month)

361 TPH (Day)

8.75

As a result, Shrees cost of high grade limestone

reduced from Rs. 223 per tonne to Rs. 214 per

7.50

tonne. The transportation of crushed limestone to the

plant by ropeways and conveyor belts lowered the

6.25

transportation cost. The purchase of marbles in a

semi-processed form at the companys stock yard

Cement Mill

0.00
97-98

resulted in Shree incurring a lower cost.

277 TPH (Month)

raw material quality improvement. The company

TOTAL PRODUCTION
Year

96-97

97-98

98-99

99-00

00-01

01-02 (9 months)

Clinker Production

1.254

1.670

1.945

2.285

2.113

1.625

Cement Production

1.185

1.726

2.044

2.313

2.383

1.806

98-99

99-2000

00-01

01-02

Raw material cost as a per cent of turnover

In addition to a reduction in cost, Shree focused on

Quality

used rock breaker and computerized mining software

Thanks to an improved quality of cement, among

to improve the quality of limestone, raising yields in

other factors, the company maintained its realisations

the process. The company prudently used limestone

from other mines keeping in mind the blended
content of calcium carbonate to arrive at the optimal

(In million tonnes)

RAW MATERIAL COST

content and yield.

inspite of a pressure on prices. The quality and

strength of 43 grade and 53 grade was actually more
than the normal standards of the 53 grade of
cement, resulting in a stronger value for buyers.

31

Shree achieved a consistent production of quality

blending, before the raw mix was taken to the kiln

cement through the use of international processes

for burning, from the silo before going into the kiln

housing, commercial premises, hotels, resorts and

the concretisation of roads is likely to be

and practices. Some of the processes included:

every alternate hour and before the clinker was

urban infrastructure facilities such as roads, bridges

approximately 10 million tonnes (shown below in a

sampling of raw material and the intermediate

delivered to the cement mill. The end product was

and mass rapid transport systems. As a result, the

tabular form).

product for purity on receipt, before stacking, before

tested for compressive strength, soundness, setting

Indian cement industry is estimated to grow by 9 per

being fed to the hopper, prior to grinding in the raw

time and fineness.

cent this fiscal.

mill, before being delivered to the CF silo for

Cement demand from the Golden Quadrilateral

project and NEWS corridor

Investments in road building are expected to

Cement demand

Golden
quadrilateral

North East
West
South corridor

Total road length (km)

5846

7300

Volume of concrete per km (mt)

7500

7500

Cement per km of roads (tonne)

2625

2625

Balance length
for civil

Total
length

generate a cement demand of around five million

SHREES QUALITY

tonnes per annum till 2003 and around six million

BIS specifications
225 M2

Fineness (Mt sq./Kg)

Soundness
Le Chatelier expansion (mm)
Auto-Clave expansion (%)
Setting Time (mins)
Initial
Final
Compressive Strength (Mpa)
3 Days
7 Days
28 Days

Shree quality
377

Max. 10
Max. 0.8

1.00
0.089

Min. 30
Max. 600

122
180

Min. 27
Min. 37
Min. 53

41
54
66

tonnes from 2003-2007, according to industry

sources. It is estimated that even if cement concrete
roads comprised 25 per cent of the total
infrastructure projects, the incremental demand from

Project

Golden quadrilateral (kms)

Total cement requirement

Four laned

Under
implementation

approved for
award

1,063

3,977

713

93

5,846

717

644

5,939

7,300

North South West East corridor (kms)

Source: NHAI

At Shree, the quality control team works closely with

263 kgs. With some triggers from the government,

the marketing team and the technical support group,

the cement manufacturers are confident of boosting

strengthening the product in line with consumer

per capita consumption of cement towards the global

* A World Bank study indicated that construction

feedback. Shrees quality team provides regular

average.

activity in India offers the highest economic rate of

certification, testifying the products fineness,

soundness and strength when compared with BIS
specifications, helping reinforce customer

Housing accounted for almost 60 per cent of the

demand for cement in India. Official estimates

labour. For instance, cement demand grew at 7-8 per

cent CAGR over the last decade while the economy

indicated a shortfall of 25 million houses in the

confidence.

return, given the cost competitiveness of the Indian

grew at 5-7 per cent.

country whereas unofficial estimates indicated a

shortage of 35 million dwelling units. Demand is

Demand drivers

expected to chase supply over the coming decade.

Year

60

20

97-98

98-99

99-00

00-01

SEGMENT WISE CEMENT DEMAND (Million tonne)

2001-02 2004-05 (E) CAGR %

01-02
Housing

Total no. of
houses built (mn)

3.0

3.2

3.6

4.3

4.4

As a % of total

Growth (%)

8.3

8.4

9.9

21.3

1.2

new construction
Industry and infrastructure

Housing growth is expected at 11.3 per cent

new construction

of lower interest rates, lower property prices,

Government

government schemes like the Ambedkar Awas Yojna,

As a % of total

tax shelters for housing construction companies, tax

new construction

incentive schemes on housing loan repayments and

the increasing trend towards nuclear families. The

In India, the per capita consumption of cement

government recently permitted up to 100% loans for

stood at a modest 99 kg against the world average of

the development of integrated townships including

Housing

32

Government

Industrial &
Infrastructure

63.1

62

66.7

13.3

16.7

11.3

7.9

As a % of total

compounded over the next three years on the basis

20

45.8

18

17.7

14.8

14.8

20

15.7

Total new construction

73.9

94.6

8.6

Repairs and maintenance

16.1

20.9

8.7

Total cement demand

90.0

115.5

8.6

THE INDIAN CEMENT INDUSTRY IS

ESTIMATED TO

GROW

BY 9 PER CENT THIS FISCAL

33

Finance

PUNJAB EMERGED AS THE MOST

The performance of the company in the financial year

recorded in the companys books even though the

2001-02 is not strictly comparable with that in the

disbursement transpired later. The format of

previous accounting year since the former comprised

accounting corresponded to the Generally Accepted

nine months of working (July 2001-March 2002) and

Accounting Principles practices in India. Wherever

the latter covered 12 months (July to June).

the treatment of accounts required an interpretation,

PROFITABLE
MARKET FOR THE COMPANY

the company preferred to be cautious and

Income accounting method

conservative.

The accounts presented in the report are based on

Conservative accounting policies

the accrual system of accounting - revenue was

recognised as income as soon as the transaction was

The company wrote off Rs 1.55 cr as doubtful

TOTAL INCOME
RS 397.53 CR

INCOME FROM
SALES
RS 397.22 CR

OTHER INCOME
RS 0.31 CR

INSTITUTIONAL
SALES
RS 158.42 CR

RETAIL SALES
RS 238.80 CR

debts despite the fact that these debtors are under

The entire advertisement and sales promotion

legal cases and the dues may be paid following a

expenditure was completely written off in 2001-02

settlement.

even though their benefits are likely to accrue over

According to the Indian Accounting Standard - 22,

the company provided its net deferred tax liabilities
up to June 2001 of Rs 49.54 cr out of the general

PUNJAB

RETAIL 58 % OF
PUNJAB SALES

INSTITUTIONAL 42 %
OF PUNJAB SALES

RETAIL 69 % OF
RAJASTHAN SALES

INSTITUTIONAL
31 % OF
RAJASTHAN SALES

reserves and Rs 2.14 cr out of the profit and loss.

HARYANA

DELHI

U.P &
UTTARANCHAL

TOTAL SALES
(IN QUANTITY)

34

RETAIL 51 % OF
HARYANA SALES

INSTITUTIONAL
49 % OF HARYANA
SALES

RETAIL 47 % OF
DELHI SALES

INSTITUTIONAL
53 % OF
DELHI SALES

RETAIL 72 % OF
WEST U.P SALES

RETAIL SALES
58 %

INSTITUTIONAL
28 % OF
WEST UP SALES
INSTITUTIONAL
SALES 42 %

Revenue analysis
Total income was Rs 397.53 cr in 2001-02 compared
to Rs 556.41 cr in 2000-01.

The company provided for depreciation on revalued

assets in the profit and loss account. As a result, the

RAJASTHAN

the foreseeable future.

profit for the period was lower by Rs 21.03 cr.

State wise/ market wise revenue analysis

In 2001-02, Punjab emerged as the most profitable

The company adopted a conservative policy with

market for the company with average net realisations

regard to its investments. In 2001-02, the company,

of Rs 1328 per tonne. Haryana was the next with

adopted the Indian accounting standard - 13, wherein

average net realisations Rs 1277 per tonne.

investments were stated at the cost of acquisition or

the market price, whichever was lower. As a result,

Capital employed

the companys profits were lower by Rs 4.66 cr. In

The companys capital employed decreased from

the past, long-term investments were stated at the

Rs 731.18 cr in 2000-01 to Rs 654.76 cr in 2001-02, a

cost of acquisition.

10.45 per cent decline. This was on account of a

The company wrote off the one-time premium of

number of reasons. On the liabilities side, the

Rs 2.85 cr paid to banks and financial institutions,

companys reserves decreased from Rs 362.53 cr in

which enabled the company to avail of a reduction in

2000-01 to Rs 310.04 cr: a drop of 14.48 per cent

interest rates over a period of four years.

due to provision of deferred tax. The companys

35

secured loans declined from Rs 306.48 cr in 2000-01

of deferred tax, a non-cash charge, in compliance

to Rs 272.61 cr, a decrease of 11.05 per cent over

with AS-22.

the previous financial year. This decrease in secured

loans was on account of the repayment of long-term
loans worth Rs 41.64 cr in the current financial year.
On the assets side, investments decreased from
Rs 3.60 cr in 2000-01 to Rs 1.25 cr, a decrease of
65.28 per cent over the previous financial year.

DEBT-EQUITY RATIO

DROPPED

In the current financial year, Rs 21.03 cr was

FROM 1.07 IN 2000-01 TO 1.03 IN

2001-02.

transferred to a special reserve from the revaluation

reserves created by the Board, to be used for any
purpose as per the discretion of the Board. The profit
and loss balance stood at Rs 9.59 cr in 2001-02 as
compared to Rs 3.20 cr in 2000-01.

Debtors decreased by 26.43 per cent from Rs 40.82

cr in 2000-01 to Rs 30.03 cr. The companys loans

Loans

and advances decreased from Rs 65.84 cr to

Rs 64.23 cr in 2001-02, a reduction of 2.45 per cent.

In 2001-02, loans including working capital loans from

The companys net current assets decreased to

banks declined from Rs 318.82 cr to

Rs 77.97cr from Rs 99.42 cr in 2000-01, a declined of

Rs 294.88 cr following repayment. In 2001-02, the

21.58 per cent.

company repaid long term loans worth Rs 41.64 cr.

The company borrowed for the long-term from

Capital structure
The companys capital structure of Rs 49.84 cr
comprised equity and preference shares. The former

2001-02 as against Rs 39.30 cr in 2000-01, a

Period

financial institutions to fund fresh assets, expansion,

decrease of 4.8 per cent on an annualised basis.

de-bottlenecking, modernisation and the upgradation

This interest outflow included a one-time payment of

of equipment. The company borrowed for the short-

Rs 2.85 cr to financial institutions in lieu of a

term to finance working capital requirements.

reduction in the interest rate, the benefit for which

accounted for Rs 34.84 cr while the latter accounted

for Rs 15 cr. Of the total preference shares, 7.5 lac

REDUCTION IN THE COST OF FUNDS (%)

outgo on term loans/debentures was Rs 28.05 cr in

It has been the companys endeavour to raise funds

cumulative redeemable preference shares of Rs 100

at the lowest possible cost. The company capitalised

each were issued at a coupon rate of 7.5 per cent

on a lower cost economy and re-negotiated interest

and the rest were allotted at a coupon rate of 9 per

rates for long term loans at 13.5 per cent, raised

cent.

fresh loans at 11.30 per cent and working capital

will accrue over four years. Had the company writtenoff this amount over the period of loan tenure, the
margins would have been higher.

Term loan

Working capital Total cost

December 1998

18.93

16.30

18.60

June 1999

17.43

14.81

17.02

December 1999

17.10

14.32

16.50

June 2000

16.32

13.55

15.72

December 2000

16.02

13.39

15.44

June 2001

13.50

13.01

13.41

December 2001

13.18

11.95

13.00

March 2002

12.78

10.61

12.31

loans at sub PLR rates (10.86 per cent). As a result,

Reserves
In 2001-02, reserves stood at Rs 310.04 cr as
compared to Rs 362.53 cr in 2000-01, a decrease of
14.48 per cent over the previous financial year mainly
due to the provision for deferred tax, a non-cash
charge. The revaluation reserve decreased from Rs
165.30 cr in 2000-01 to Rs 144.27 cr in 2001-02, on
account of the provision of depreciation, a reduction

12.31 per cent. Debt-equity ratio stood at 1.03 in

2001-02 as against 1.07 in 2000-01. The company

RE-NEGOTIATED INTEREST RATES

Institution

Loan type

does not expect to exceed a debt-equity ratio of 1.00

even after raising Rs 85 cr from debt for the power
project (details elsewhere in the report).

Interest

Loan

Interest rate

Interest rate

Gross savings

Premium

Net

amount

before

after

on interest

paid

saving

Rs/cr

restructuring

restructuring

(Rs)

Rs/cr

Rs/cr

6.15

2.51

3.64

IDBI

Corporate loan

96.42

16.50 %

13.50%

NIA

Overrun NCDs

0.35

17.50 %

13.50%

0.02

0.01

0.01

OIC

Overrun NCDs

0.20

17.50%

13.50%

0.012

0.005

0.007

in debenture redemption reserve from Rs 38.30 cr in

Interest outflow was Rs 26.93 cr compared to

NIC

Overrun NCDs

0.20

17.50%

13.50%

0.012

0.005

0.007

2000-01 to Rs 18.87 cr in 2001-02, a decrease by Rs

Rs 44.01 cr in 2000-01. The average cost of funds

UII

Overrun NCDs

0.27

17.50%

13.50%

0.012

0.005

0.007

19.44 cr due to the redemption of debentures and a

dropped from 18.60 per cent in December 1998 to

LIC

Project loan

9.34

16.50%

13.50%

0.58

0.24

0.34

reduction in the general reserves from Rs 125 cr in

12.63 per cent in March 2002. Interest outflow as a

GIC

Project loan

1.09

16.50%

13.50%

0.07

0.023

0.047

2000-01 to Rs 85.56 cr, a decrease of 31.55 per cent

proportion of the turnover dropped from 7.93 per

NIC

Project loan

0.65

16.50%

13.50%

0.04

0.02

0.02

NIA

Project loan

1.02

16.50%

13.50%

0.06

0.02

0.04

over the previous financial year, due to the provision

36

the companys average rate of borrowing stood at

cent in 2000-01 to 6.78 per cent in 2001-02. Interest

37

Capital expenditure

compared to Rs 59.07 cr in 2000-01.

The company invested Rs 42.17 cr in capex in 2001-

The companys turnover-to- assets ratio was 0.85x in

02, of which Rs 19.72 cr was on account of 36 MW

2001-02, reflecting optimum sweating of fixed

power project and the balance towards the

assets. The companys gross block to capital

completion of the expansion from 2.0 million tpa to

employed stood at 1.22 at the end of the financial

2.6 million tpa.

year under review indicating that a high per cent of

capital expenditure was used in productive assets.

THE COMPANYS GROSS BLOCK

INCREASED
BY 9.2 PER CENT TO RS 844.59 CR,
INDICATING THE COMPANYS
CONTINUOUS INVESTMENTS IN

The pet coke project was funded with a Rs 26 cr

ICICI loan, repayable over six years. Since the project
was approved by the World Bank under the Pollution
Prevention Scheme, the company enjoyed an
interest rate subsidy of 1.50 per cent that will save
Rs 1.71 cr over the period of the loan.

Loans and advances

Shree made a depreciation provision of Rs 43.13 cr in

2001-02 (9 months) as against Rs 53.73 cr in 2000-01
(12 months). Total accumulated depreciation stood at
Rs 249.93 cr in 2001-02 compared to Rs 207.14 cr in
2000-01.

materials, making advances, availing cash discounts

02 on account of a stronger financial discipline

on the total billing, maintaining an inventory of

wherein the company evolved to a cash-and-carry

production spares, sustaining the production cycle

system. Credit worthiness was appraised on a

without interruptions and sustaining all the usual

periodic basis. Attractive financial incentive schemes

functions within the organisation.

and a standardised discount system was instituted to

Loans and advances stood at Rs 64.23 cr in 2001-02

The company provided depreciation on a straight-line

as compared to Rs 65.84 cr in 2000-01, a decrease

basis as per the rates specified in schedule XIV of

of 2.5 per cent. Loans and advances constituted 45.6

the Companies Act 1956. Depreciation in 2002-03 is

per cent of the total current assets in 2001-02. The

expected to increase following the commissioning of

decrease in loans and advances was primarily on

the captive power plant. The increased depreciation

Working capital accounted for 12 per cent of the

account of a reduction in inter-corporate deposits and

is expected to provide the company with a significant

companys total capital employed in 2001-02. The

In the institutional segment, debtor days dropped

short-term deposits in mutual funds. Nearly 37 per

tax shield.

total quantum of working capital was Rs 77.97 cr

from 33 days in 2000-01 to 30 days in 2001-02 on

cent of the total loans and advances comprised

Investments

compared to 99.42 cr in 2000-01, a 21.58 per cent

account of a non-trade cell to monitor oustandings,

decrease. The companys turnover to working capital

assess the quality of buyers, collect bank guarantees,

In 2001-02, the company provided diminution in the

ratio increased from 5.6 times in 2000-01 to 6.8

post-dated cheques and upfront payments.

market value of investments in the accounts

times in 2001-02.

Inventories

Sundry debtors

Inventories increased from Rs 34.72 cr in 2000-01 to

short-term deposits with mutual funds worth Rs

23.63 cr.

Gross block
In 2001-02, the companys gross block increased by
9.2 per cent to Rs 844.59 cr, compared to Rs 773.63
cr in 2000-01, indicating the companys continuous
investments in assets. The increase in gross block
was on account of the installation of new equipment,
plant and machinery as well as the replacement and
modification of existing equipment to increase the
companys installed capacity.

(mentioned elsewhere in the annual report). Shrees

investments stood at Rs 1.25 cr in 2001-02,
compared to Rs 3.60 cr in 2000-01, a decrease of
65.24 per cent. The company invests short-term
surpluses in mutual funds. These funds are liquidated
when required to directly fund the business. [The
companys investment policy has already been
discussed under surplus management elsewhere in
the annual report].

Retail sales increased by 10 per cent in 2001-02,

sundry debtors decreased by Rs 10.79 cr; debtors
exceeding six months decreased by Rs 1.0 cr. This
indicates that the company collected its outstandings
faster from the marketplace.

ensure a quicker settlement of outstandings.

Rs 41.03 cr, an 18.17 per cent increase over the

previous financial year primarily due to an increase in
the stock-in-process. As on 30.06.2001, inventories
were low on account of higher dispatches. However,
the company succeeded in reducing inventories from
Rs 66.78 cr in 1999-2000 to Rs 41.03 cr in 2001-02, a

Sundry debtors stood at Rs 30.03 cr in 2001-02,

decline of 38.56 per cent, an encouraging

compared with Rs 40.82 cr in 2000-01, a 26.43 per

achievement given the state of the industry. In 2001-

cent decrease. Debtor days decreased from 27 days

02, the increase in inventories was on account of an

The companys accumulated depreciation of Rs

Working capital outlay

249.93 cr in 2001-02 constituted 29.59 per cent of

In the cement business where the production and

in 2000-01 to 21 days in 2001-02, reflecting prudent

increase in material-in-transit from Rs. 0.92 cr to

the companys gross block. The companys capital

marketing cycle times can be long, working capital

debtor management. In the retail segment, debtors

Rs 1.62 cr and an increase in goods-in-process from

funds a number of activities: the purchase of raw

reduced from 17 days in 2000-01 to 13 days in 2001-

Rs 1.19 cr to Rs 7.32 cr.

work-in-progress stood at Rs 30.29 cr in 2001-02

38

ASSETS

Depreciation

39

Technology
Information

Changing Role of IT

because of its low flexibility. Besides, the cost of

maintaining the ERP would have been very high. The

Information technology has come a long way at Shree

Cement. Previously it provided support to the
accounting function in a Character user interface (CUI)
environment. Now it provides online support in a

Internet leased line was chosen as the backbone of

the network, because of lower amount of data loss as
compared to the V-SAT network and its cost
effectiveness over the next alternative.

Graphic user interface (GUI) environment to different

functions like finance, personnel & administration with
a state-of-the-art Oracle 8I database at the back end,

Other Achievements

financed working capital and for the invested in debt

and using Visual Basic as a front-end tool.

Launched website, www.shreecementltd.com.

mutual funds. The company invested temporarily

The changes happening in the marketing organisation

A dedicated team updates this website. The link to

surplus funds cumulating to Rs 155.84 cr in safe,

would not have been successful without IT seamlessly

sales & Distribution module is also given here. Those

income growth funds and mutual funds in 2001-02.

integrating the effort of their department. The Sales &

authorized can access this module by entering their

These investments were liquidated to meet debt

Distribution model used Java at the front end and

respective username and password.

repayment schedules. As a matter of policy the

Oracle 8I as the database. The S&D module not only

Employees were provided with a web-mail facility.

company did not invest in equity markets. The

supported intranet computation but it could be

Computers were also increased. Communication

companys long-term accruals were used to fund

accessed online. Field officers accessed the S&D

between the employees became much easier and cut

Rs 350 per tonne of cement and Rs 200 per tonne of

capacity/ expansion, modernization of plant and

module through the internet. Order booking, Inquiry,

phone and fax bills.

clinker. The companys second plant is entitled for

machinery, capital expenditure projects and repay

bills generation were also done online.

sales tax deferment for a period of seven years -

loans.

The backend server, located at Beawar did the online

Corporate tax
In 2001-02, Shree Cement provided income tax of Rs
3.10 cr. In addition it provided for deferred tax of Rs
2.14 cr, as per accounting standard AS-22 introduced
for the first time. This did not involve a cash out go.

Miscellaneous tax
The companys products attracted an excise duty of

from 1997 to 2004-05 - subject to maximum

deferment quantum of Rs 156.3 cr. At the end of the

Challenges, 2002-03

Instead of a 64 kbps leased line, Shree switched to a

256 kbps internet leased line.

processing of all the inputs. The backbone of this

system was the leased Internet line.

Initiatives for the Future

exemption period, the company will be required to

* The company intends to prepare financial

This IT infrastructure provided a considerable

Making the financial accounting module available

remit sales tax to the government in 10 half-yearly

statements by the 11th of the ensuing month and

advantage over the other option of implementing ERP.

online for the authorized user.

installments starting from 2005-06. The total sales

profit and loss account by the 9th of the ensuing

The ERP would have been difficult to implement,

tax deferment availed stood at Rs 56.64 cr till 31st

month.

March, 2002.
The sales tax on consumables and stores was 4.6
per cent and the effective input tax on raw material
stood at 3.45 per cent. Customs duty on cement and
clinker imports decreased from 25 per cent in 200001 to 20 per cent in 2001-02.

Getting the inputs from weigh bridge online to

exercise better control on in-bound and out bound

The company expects to finalise its year-end

logistics.

accounts within 20 days of the year-end.

Fully computerize the employee attendance and
The company expects to set up a web site wherein
audited accounts can be accessed by investors,
customers and the public at large.

payroll system.
In the coming days, IT is expected to play an even
more important role in terms of integrating the various

The company expects to reduce the remittance

activities of the business, maintaining data and

Surplus management

period from 1.26 days in 2001-02 to 0.7 days in 2002-

providing information.

An excess of income over expenditure translated into

03, helping the company maximize returns from

a surplus. The companys temporary surpluses

mutual funds and reduce interest outflow.

RISK
management

In 2001-02, the company embarked on a Rs 120 cr

capex programme to commission a 36 MW captive
power plant at Beawar. This backward integration
has been intended to make the company
completely self-reliant for its energy needs at a
significantly lower variable cost - Rs 2 per unit as
against the purchased power rate of Rs 4.19 per
unit from the Ajmer Vidyut Vitran Nigam in 2001-02,
saving the company about Rs 30 cr per year. This
plant same will be operational by December 2002.
The turnkey project for this captive power plant has been awarded to the Punebased Thermax Limited. The project cost is being funded through debt and
internal accruals.

42

43

An overview
Michael Porters industry structure explains the various threats and opportunities graphically

RISK

CONSOLIDATION AND CEMENT PRICES

MITIGATION

India is protected from imports through distance. The

landed cost of cement (without tariff) works out to $ 40

THREAT OF NEW
ENTRANTS

SUPPLIERS COST
FACTORS

Market share of

Cement prices

top three players

per tonne (Rs 1960 per ton). Following the imposition of

($)

a 30 per cent customs duty and a counter veiling duty of

UK, France, Germany

90

100

High capital costs and/or initial

Rs 350 per tonne and octroi charges, the delivered price

Venezuela

90

120

profitability.

of bulk cement amounts to Rs 2967 per tonne compared

Canada

80

100

with the domestic price of Rs 2600 per ton.

Brazil

60

60

Japan

50

85

United States

40

90

Turkey

35

30

30

30

2-3

35

38-40

40

High freight and infrastructural

bottlenecks discourage imports.

Prices of coal and grid

CUSTOMERS
BARGAINING
POWER

IMPORT OF CEMENT VIS-a-VIS LOCAL PRICES

FOB

US$/tonne

24

Romania

Limited bargaining

Insurance and freight

US$/tonne

16

China
India

electricity are controlled by the

state. Price increases are
inevitable.

INTERNAL RIVALRY

Cement companies have set

Intense price competition

up captive power facilities to

ensure cost effective and
reliable power, a critical
requirement in producing
cement.

Country

THREAT OF SUBSTITUTES

power of retail

CIF

US$/tonne

40

customers.

CIF @ US $ (1USD=49INR)

Rs / tonne

1960

Bulk buyers

Add effective import duty @ 25 %

Rs / tonne

392

(government agencies

CIF- After Import Duty

Rs/tonne

2352

and builders) exert

CVD

Rs/tonne

350

limited pricing

Unloading and port charges

Rs/tonne

265

pressure.

Landed Cost

Rs/tonne

2967

Source: Building material prices survey, UK, Cement (all these rates
include delivery to sites and discounts but exclude VAT and local tax).

Technology risk
The cement manufacturing technology used by Shree
Cement might be phased out.

Practically none.
Clay and plaster are unproven.

Pricing risk

RISK

Cement prices are vulnerable to short-term price

selected to use the dry process for manufacturing

pressures exerted by various manufacturers.

cement over the wet process. The dry process produced

RISK

Competition risk
New capacity might outprice existing companies
like Shree Cement.
RISK

MITIGATION

to cover the complete cost of setting up fresh capacity

48 per cent of Indias total cement capacity is accounted

unless cement prices rise beyond Rs 180 per bag.

for by the top five cement companies / groups against 30

Besides, fresh cement capacity from 2003 will not

per cent a few years ago. This consolidation is a driver of

enjoy a lower sales tax structure but be levied a rate of

stable pricing in the industry and has been driven by

12 per cent, cutting out any benefit.

large Indian manufacturers and international brand names

It is doubtful whether greenfield capacities will be able

to compete with existing manufacturers like Shree

this consolidation, cement prices firmed up by Rs 15-40

Cement due to the vast differential in capital costs: the

per bag in the year 2001. It is expected that this trend

infrastructure (including captive power plant) is placed

at Rs 4200 per tonne, compared with Rs 2397 per
tonne for Shree. Because of this high cost of
commissioning, new manufacturers may find it difficult

Import risk
Large producers like Japan, Korea, China, Taiwan,
Thailand and Indonesia, where supply exceeds
demand, could dump their output in India and
depress prices.

When Shree commissioned its business in 1985, it

quality cement at a low cost. Over the last decade and a

MITIGATION

buying over weak, debt-saddled companies. Thanks to

capital cost for setting up a greenfield plant and

MITIGATION

will continue.

half, the decision to select the dry process continues to

remain valid. Besides, no other technology has emerged,
vindicating the companys decision to use the dry
process as a long-term alternative. Since the company is
working with leading equipment suppliers, it enjoys an
access to the prevailing technology trends the world
over. As a result, the company is confident that it will be
able to evolve its production process as soon as new
technologies have been established, resulting in a lead
over competitors in the field.
Besides, technology is continuously strengthened at
Shree through an ongoing modernization programme.
This helps the company report a high capacity utilisation
and a lower consumption of fuel inputs and raw
materials.

44

45

THE COMPANYS

QUALITY

Brand risk

Concentration risk

The Shree brand might not generate adequate sales in the

Nearly 98 per cent of Shree's offtake transpires in the

market place.

North Indian market, an excessive dependence.

RISK

RISK

EQUIPMENT INCLUDES AUTO

SAMPLERS, X-RAY ANALYSERS AND
THE RAMCO SYSTEM

MITIGATION

MITIGATION

Since the majority of the company's sales transpire at the

Shree sells profitably in the growing markets of Rajasthan,

retail end, the company has embarked on a brand building

Punjab, Haryana, Himachal Pradesh and west U.P. - regions

exercise. The company has identified its cement with a

that are deficit in cement. As a result, the company's

clear USP - durability. This attribute has been reinforced

excessive dependence is seen as prudent and not limiting

with the logo of the long-living tortoise. The company

the company's proposed growth.

expects that these initiatives will help the company

Cost risk

generate a top-of-the-mind recall that cuts through product

investment. The company has invested Rs 2.26 cr in

quality checking and controlling equipment. The

clutter, create a customer pull and result in the sale of

In a mature industry like cement, most cost reduction

companys quality equipment includes auto samplers, X-

higher volumes.

opportunities have been explored by most manufacturers

ray analysers and the RAMCO system to ensure a better

and further reductions are no longer possible.

and consistent delivery. Quality at Shree is also

RISK

At Shree Cement, we recognise that it will be possible to

achieve incremental cost reductions only through the
intelligent and lateral application of the sciences than
through a linear extension. This was adequately

expansion, the company may be forced into a liquidity

Geographic risk

result, the quality of every outgoing batch of the end

product is checked for quality and the findings

Shree Cement's plant in Beawar, Rajasthan, could be

documented. This statement of quality accompanies the

placed in the wrong location.

dispatch into the marketplace.

RISK

to generate incremental savings through the use of

Shree Cement is blessed with a favourable location at

made a complete switch in favour of pet coke. This

daring and pioneering transition resulted in Shree
Cement reporting a cost reduction of Rs 25.55 cr during
2001-02.

RISK

MITIGATION

The company's cash flow in 2001-02 was adequate to

MITIGATION

operations was Rs 46.74 cr enough to pay the debt

obligations to the extend of 41.64 cr. Debt obligations are

Environment risk

Beawar, just two kilometers away from captive limestone

Rs 36 cr in 2002-03, while the cash flow is expected to be

In a business which discharges dust and fuel gases out

mines, the principal raw material for cement. Shree's plant

higher. The company also retained Rs 23.63 cr in financial

of its system, any uncontrolled emission could lead to an

is also the northernmost in Rajasthan, the closest to the

instruments as a hedge to meet any unexpected cash

environment censure.

growing market of North India. The plant is also just a few

requirements at a short notice. The company's interest

kms away from the national highway. The company already

cover at 2.85 was adequate to meet the company's debt

owns a BG railway siding at its plant.

servicing requirements.

RISK

MITIGATION

In addition to Rs 34.29 cr of investments to minimize

Quality risk

squeeze.

meet obligations on all three fronts. Cash flow from

demonstrated by Shree in 2001-02: instead of attempting

imported coal, the conventional feedstock, the company

Cement is a cash-intensive business. In the process of

repaying debt, sustaining production and funding

supported by a strong documentation process. As a

MITIGATION

Finance Risk

emissions to levels way below those recommended by

the central and state pollution control boards, Shree

In a business where the company turns out 4.80 cr bags

Cement also enjoys a proactive culture dedicated to

in a year, an under-delivery in any consignment could

safety in manufacturing practices.

damage the companys brand in the marketplace.

THE COMPANY'S INTEREST COVER

AT 2.85 WAS

The company trains its engineers actively in environment

RISK

46

MITIGATION

management practices. It has greened an increasing area

Shree has a focused research and development

within its plant premises with drought-resistant foliage.

laboratory, which works with samples of various raw

Most importantly, the company has integrated

materials and end product. Quality at Shree Cement is

environment management into its manufacturing

not an end-of-the-pipe test but an ongoing appraisal at

practices. Over the years, the company has produced

every stage. As a result, quality deviations are corrected

more cement out of less raw material, minimised waste

with the smallest loss and shortest downtime.

and slashed the consumption of fuel (more details in the

Shrees quality intent is supported by a commensurate

environment section).

ADEQUATE
TO MEET THE COMPANY'S DEBT
SERVICING REQUIREMENTS.

40

47

HUMAN
resource
People are the companys valuable
asset. Every initiative, every
improvement, every strength is the
result of the aggregate people
strengths within the organisation.
Shree Cement Limited is committed
to providing the right environment for
people to work and inculcate a sense
of ownership.

Importance of human resource

The role of HR is to energise and develop people
to ensure that the company emerges as one of the
most profitable cement manufacturers in the
country. The importance of the HR function lies in
the fact that in an extremely competitive industry
like cement, the companys performance depends
on the creativity, motivation and initiatives of the
individuals. Individuals comprise the critical
resource, instrumental in bringing about
improvements in the manufacturing process
thereby reducing operating costs and maximising
gains. In 2000-01, the company embarked on
creating a mindset that enabled employees to
deliver a winning performance. The results have
been carried in the intellectual capital report, a
supplement to the core annual report.

Initiatives in 2001-02
CREATING LEADERS AT EVERY LEVEL.
In 2001-02, Shree embarked on creating leaders not just at the organisational apex but at every
level, resulting in a strong sense of emotional
ownership. Result: in November 2001, the
company institutionalized a suggestion scheme
called Jo soche woh Paave. The key objectives of
48

41
50

THE KEY OBJECTIVES OF THIS

SCHEME WERE TO

EMPOWER
EMPLOYEES TO THINK LIKE
LEADERS

RESPONSE

relevance of certain skills. The training priorities were

classified into four big areas: technical, safety and health,

Till 31.3.2002, 730 suggestions were received, of which

environment (conservation of resources) and behavioural.

527 (72 per cent) evaluated, and 24 suggestions

The ultimate objective of all training programmes was a

accepted for implementation. The total prize money

reduction in costs through improved quality, lower

disbursed for the 24 winners amounted to Rs 50,000. Of

downtime, improved productivity, reduced energy

the 730 suggestions, 33 per cent came from the workers

consumption, enhanced technical skills, better

and 67 per cent from the staff. The details of the number

communication and information sharing through

of staff members and workers who participated are

strengthened interpersonal skills.

shown below :
The number of training programmes conducted by the
company increased by 79 per cent from 176 in 2000-01
Number of suggestions received

730

to 315 in 2001-02. The total number of employees

covered by these training programmes increased from

this scheme were to empower employees to think like

immediately. Lastly, participants who were not satisfied

Number of employees who participated

237

leaders by providing them with a platform to

with the suggestion scheme committees verdict

Number of staff participants

168

communicate their ideas, to bring all the members of the

possessed the right to approach the committee and ask

Per cent of total participants

70

Shree family into the mainstream and ensure their active

for a review of the results. This eliminated subjectivity

Number of worker participants

69

participation in the development of their as well as the

from the system.

Per cent of total participants

30

organisations health. This was done to harness the

latent potential of employees to will help the company

EVALUATION

reduce costs, increase productivity, make the

The suggestions received were classified in four

organisation a safer place to work in and increase

categories :

TRAINING AND DEVELOPMENT

profitability. Aapki bhagedari, hum sab ki khushali.

Rs - 2,000,

The company recognised that training was the principal

Rs - 5,000,

insurance against intellectual obsolescence. Result:

Rs - 10,000,

Shree reinforced its training emphasis in 2001-02 to

Rs - 20,000.

develop and enhance the inventory of skills. The biggest

ELIGIBILITY FOR THE SUGGESTION SCHEME

All members of the organisation - right to the president
of the plant were eligible to participate: employees upto

Other HR initiatives in 2001-02

1861 employees in 2000-01 to 4904 employees in

2001-02: a 164 per cent increase over 2000-01. The
number of man-days covered increased from 652 days in
2000-01 to 1255 days in 2001-02, a 92 per cent increase
over the previous financial year. The total number of man
hours covered by the training programme increased from
5159 hours in 2000-01 to 10036 hours in 2001-02, an
increase of 95 per cent.The amount spent on training
increased from 2.06 lacs in 2000-01 to Rs 3.77 lacs in
2001-02. The companys training initiative covered not
just management level employees but also shop floor
workers.

change was that training was no longer looked upon as

In 2001-02, the company started the concept of multi-

manager levels were invited to receive cash prizes and

CRITERIA

an HR function but an integral part of the Shree work

skilling to optimise manpower, enhance skill sets and to

employees above the manager level were entitled for

Suggestions to improve the environment and increase

culture. Training programmes conducted on a continual

facilitate cross-functional development. Unlike other

basis. As a result, department heads organized their own

organisations who introduce multi-skilling for high fliers,

training programmes according to the training needs and

the company started this concept first for its workers.

reward through appreciation certificates.

USP OF SHREES SUGGESTION SCHEME

safety.
Suggestions to generate the savings of Rs 5 lacs per
annum to the company.

Unlike suggestion schemes in other companies where

the prize money is a small amount, the companys prize
money range from Rs 2,000 to Rs 20,000 depending on
the nature of suggestion. This reflect the companys
commitment to create leaders at every level by
commensurately rewarding innovative concepts. Another

Rs 10 lacs per annum.

Suggestions to reduce the cost of production by over
Rs 10 lacs per annum.
In case the company saved more than the amount

important way in which the companys suggestion

factored in the suggestion, the incremental amount

scheme differed from other companies was that it was

will be shared with both the suggestor of the scheme

not carried out once in a year but transpired on a weekly

and the implementer. This reflects the companys

basis. A suggestion scheme committee was formed,

commitment to pass on all benefits to the members

which looked into the suggestions given on a weekly

of the organisation, to incentivise improvements.

basis after which the winners were announced

50

Suggestions to reduce the cost of production by

THE NUMBER OF

TRAINING
PROGRAMMES CONDUCTED BY THE
COMPANY INCREASED BY 79 PER
CENT FROM 176 IN 2000-01
TO 315 IN 2001-02

51

SHREE OPTIMALLY UTILIZED ITS

SURPLUS

STRENGTH

BY DEVELOPING WORKER SKILLS IN

OTHER TECHNICAL PROCESS

Reason: the company faced a problem of surplus

The company received the National Safety Award in

workers. Other organisations would have resorted to

2001 for the longest accident-free period.

retrenching and laying off, but not Shree. Shree optimally

utilized its surplus strength by developing worker skills in
other technical processes. This helped the company build
in a redundancy factor wherein at any given point there
was always a skilled set of people for any function. The

despite the large manpower. According to the

their families. These included personality development

Whitehopleman report, the company is probably one of

workshops, a nine day programme on spiritual

the few companies that can aim for a five-star rating.

discourses by Maharaj Shri Laxman Sharanji to cater to

Shree believes that excellent human capital gives it the

employees religious sentiments, a Bhajan Sandhya by

cutting edge required to excel in a highly competitive

Anup Jalota at the Pushkar Fair and lastly, a number of

environment. To strengthen its marketing team, Shree

health and cookery classes for the Shree Ladies Club

recruited 63 indivisule in 2001-02 of which 24 were

members.

MBAs, 5 engineers and 1 CA.

The company revamped its salary structure to emerge

Due to the multi-skilling programme initiated by the

as one of the best paymasters in the cement industry.

The company received the Nehru Memorial National

Award for Best Environment & Implementation awarded
by International Greenland Society, Hyderabad for
outstanding initiatives embarked by the company for
environment conservation.

company reduced overtime through efficient manpower

utilisation, organised smooth functioning of the

The company received the National Energy

production cycle, increased job security leading to a

Conservation Award from the Ministry of Power for a

greater sense of belonging and a strengthened industrial

continuous improvement in power consumption and

relations. As a result the company did not lose a single

utilisation.

days work due to strikes or lockouts.

The company has not lost a single days work on

Following the success of multi-skilling with workers, the

account of industrial strife. This achievement is

company introduced this concept with staff members.

commendable when one considers that despite an All

The objective was to enhance competencies and to

India strike and three Rajasthan strikes in 2001-02 the

enable managers understand how an initiative taken by

company operated in full swing with 100 per cent

their department could affect the productivity and

attendance.

performance of another department. This broadened the

The company received a four-star factory rating in the

outlook of staff members, making them think like

survey of cement factory performance conducted by

business managers.

Whitehopleman and International Cement Review. Till

company, attrition rate stood at 3 per cent, one of the

lowest in the cement industry.
To increase employee morale, the company organized a

To safeguard employees health, the company

organized de-addiction campaigns related to the
consumption of tobacco products, smoking and drinking.

number of cultural programmes for its employees and

date, no factory has achieved a five star status. The

HR achievements
The success of the companys training programmes was
reflected in the following instances:
The company was probably the only cement
manufacturer in Rajasthan to have an accident-free
period between 12.2.97 to 31.12.98. In 2001-02, the
company had no fatal accidents due to increased
awareness on safety brought about through strong
training programmes.

factory achieved a Best Practice Performer status in the

areas of energy efficiency and equipment productivity.
The kilns and mills at the factory continue to set
standards of excellence for the rest of the industry.
However, downtime at the kilns still remained an area of
concern, which the company needs to strengthen.

DUE TO THE MULTI SKILLING

PROGRAMME
INITIATED BY THE COMPANY, ATTRITION
RATE STOOD AT 3 PER CENT

Electrical energy consumption and the overall power

consumption were the lowest in the Indian cement
industry while the company hade an impeccable track
record in the area of safety with only one accident
53

ENVIRONMENT
report
Shree Cement protects the
environment through its

6R

approach, covering initiatives that:

Reduce
Raise production
Release less
Replace
Record
Restore
Research
Responsible manufacturing at Shree extends from processes that add to shareholder
value to practices that enhance community value.

Reduce
A reduction in consumption is the first step towards a responsible environment management process.
Shree Cement possesses an inspiring record in this respect. Over the years, the company has reduced the
consumption of power and fuel from 23.4 per cent of its turnover in 2000-01 to 22.6 per cent in 2001-02.
The company has a specific power consumption of 79 kwh / tonne cement produced (prevailing Indian average is
105-110 kwh/ tonne) which makes it one of the most energy efficient cement making plants in the world
100

YEAR WISE POWER AND COAL CONSUMPTION

Year

Power Consumption

Coal consumption

(KWH/ tonne cement)

(in kg/tonne of clinker)

1996-97

90

155.7

1997-98

83

129.4

1998-99

79

127.9

1999-2000

75

123.4

2000-01

78

94.7

2001-02

79

94.7

90

80

70

60

97-98

98-99

99-2000 00-01

01-02

Power Consumption

54

52

55

THE COMPANYS SECOND UNIT IS

RATED AS AMONG THE MOST

ENERGY

EFFICIENT CEMENT MAKING PLANTS

IN THE WORLD

STATUTORY COMPLIANCE
(Milligram/ Nm3)
Year

Kiln-I SPM

Kiln-II SPM

1999-2000

141.47

116.61

2000-01

112.73

55.48

2001-02

87.97

59.69

Record
At Shree Cement, we believe that no environment
management programme can succeed if it is not
accompanied by a strong culture of documentation.
Shree has a prescribed method for carrying out every
manufacturing process. This takes experiments out of

The maximum permissible limit is 150 Milligram/ Nm3.

the system. Besides, the companys measurement

practices help deviations to be identified and corrected

Raise production

collection efficiency from 95% to 98.5%.

A high capacity utilisation indicates an efficient sweating

(Microgram/m3)

The result is a safe, consistent and predictable

operational process. This is reflected in the companys

The company reduced CO2 emission through the

computerised optimisation of the raw mix design, a

Year
1999-2000

SPM
434.0

SOX
5.80

NOX
6.80

continuous check on the fineness of raw mix and coal,

2000-01

432.0

9.51

11.86

National Safety Award for the Largest accident-free

Shree Cement has a formidable record in this respect.

by plugging false air entry in the kiln, through a closer

2001-02

422.5

13.50

18.15

period from the Ministry of Labour.

Through an intelligent use of people and technology, the

control on the burning condition inside the kiln and

companys production from Plant One has risen from

through the recovery of waste heat.

of existing assets. The higher this number, the stronger

the efficiency and a better use of the earths resources.

The maximum permissible limit is 500 Microgram/per

276672 MT in 1985 to 608170 MT in 2001-02. Its output

from Plant Two has risen from 392713 MT in

The companys environment management record is

1997-98 to 1198188 tonnes in 2001-02.

continuously audited by state / central pollution control

boards and independent agencies. The company has

Metre for SOX and NOX.

already complied with the rigorous requirements of the

Replace

ISO 14001 and now awaits certification.

Intelligent substitution without a quality compromise is a

Shree attribute.

REDUCED CO2 EMISSION

equipment supplier, rated Shrees achievement as

In 2001-02, the company shifted from the use of

800

perhaps the best in the world.

imported coal as its principal feedstock to pet coke and

saved Rs 25.55 cr in the process.

Release less
Shree Cements immediate vicinity is clean because the
company releases negligible waste - stack and fugitive

650

Over the years, the company has invested

greening programme around the plants vicinity. Over the

years, the company has planted a total of 1,32,379 trees,
covering 35.18 per cent of the plant vicinity.
Shree has planted drought-resistant trees in the region.
Mined out areas are used for green bed development
and the storage of rain water. For greenery programs at

Besides, the company replaced the use of HSD with

water from wells around the locality is used. Gypsum is

LDO for the in-house generation of power and saved

added to the soil to reduce its briny nature and reduce

another Rs 2.09 cr during the financial period under

water consumption. As a prudent and far-thinking

review.

initiative, some projects promoted by the company have

made use of drip irrigation for a maximum green cover at

575

Rs 34.29 cr in sophisticated pollution control assets

Shree restores to nature what it takes from it.

the plant, staff colony, labour colony and other areas,

725

emissions - into it.

Restore
As a result, the company has conducted an aggressive

lies at the heart of Shrees utilisation edge. In 2001-02,

TPD/ per cubic metre of kiln space, F.L Smidth, reputable

strong safety record. In 2001-02, company received the

Cubic Metre for SPM and 120 Microgram/per Cubic

A better understanding and utilisation of the kiln space

Shree Cement achieved an average kiln loading of 5.73

the lowest running expense.

(electrostatic precipitators and bag filters) to minimise

the emission of waste. The company collects waste and

500

neutralises it before its harmless release into the

97-98

98-99

99-2000

00-01

01-02

Reduced Co2

environment.

OVER THE YEARS, THE COMPANY HAS

To control emissions on an ongoing basis, the company

trains employees on the prudent management of

Year

machines, waste material and waste heat recovery.

1997-98

777

Besides, the company switched from the use of

1998-99

701

limestone blasting mines to mechanised rock breakers,

1999-2000

693

minimising sound and dust pollution. A dedicated fly ash

2000-01

621

35.18 PER CENT OF THE PLANT

silo replaced storage in an open yard. The installation of

2001-02

632

VICINITY

DD cones in the pre-heater cyclone improved the

56

as soon as they transpire.

Stacker & Reclaimer fugitive emissions

separation efficiency of dust and improved dust

Kg Co2 / T Cement

PLANTED
A TOTAL OF 1,32,379 TREES, COVERING

57

FIVE YEAR PLANTATION RECORD

Year

Conducts comparative studies with other plants to

Trees planted

1997-98

4000

1998-99

7700

1999-2000

7722

2000-01

8957

2001-02

20867
Total area Area under
(Hectare)

% of

plantation greenery
(Hectare) (Hectare)

Carries out studies of various sections in Shrees

members came down from Ajmer for the purpose.

community around its manufacturing complex. Shrees

FOR VILLAGERS / TRAVELLERS:

community development is spearheaded by the Shree

Continued the facility to provide drinking water to the

Ladies Club.

travellers.

COMMUNITY DEVELOPMENT

Conducted a free Eye operation camp. People who

For the benefit of employees and their families :

came down from the villages were provided free

Eminent consultants conducted workshops for the

accommodation, food and transport.

Continuous researches to improve existing processes.

development of children. Workshops were also

Facilities for food, water and medicine were arranged

Over the last few years, the Shree R&D achievements

conducted for the married people, to promote a better

for piligrims walking bare foot for the famous

include:

understanding among the couples.

Ramdevra festival.

Cultural programs were held at regular intervals. In few

Donated ornaments, sarees to the couples getting

cultural programs, participants came from the schools

married at a mass marriage of the Mali community.

plant.
Generates a performance report of newly installed
projects.

raw material fuels.

Main plant

80.00

27.40

34.25

Staff colony

50.00

18.50

37.00

Labour colony

44.00

14.52

33.00

A conservation in electrical and thermal energy.

Ropeway-belt conveyor

12.00

4.96

41.33

An improvement of the product quality.

Rest area

42.94

15.16

35.30

228.94

80.54

35.18

Total

Conducted an acupressure camp. A team of 16

Shree is committed to the development of the

Studies the possibility of using low cost, alternative

Site

Community Development

identify areas of strengths and weaknesses.

and colleges of Beawar.

A reduction in production costs.

Non-renewable resource conservation through the use

Research
Shree Cement is one of the few cement companies in
India with a full-fledged Research and Development

of fly ash.
A reduction of waste in mines through use of coal
with low ash.

department equipped with qualified and experienced

A decade ago, the company used 1.54 kg of raw material

scientists.

in its cement; in 2001-02, the corresponding figure had

Shree Cements ongoing research initiative is directed at

dropped to 1.39 kgs.

finding a better way of making the best use of the earths

finite materials. The research and development unit:

58

59

DIRECTORS
report

THE PRODUCTION FACILITY OPTIMIZATION

PROGRAMME OF THE COMPANY TO

INCREASE

ITS CAPACITY FROM 2 MILLION TONNES TO

2.6 MILLION TONNES WAS CARRIED OUT IN
THE PERIOD UNDER REVIEW
Your Directors present their Report on the business and operations of the company together with Audited Accounts for
the period ended 31st March 2002.

Financial results

Dividend

well for the North Zone producers particularly in

The financial highlights of the companys performance in the last financial period was:

view of no green-field capacity being set up or

Your Directors are pleased to recommend the

(Rs. in cr)

Sales
Other Income

Period ended

Year ended

31.3.2002

30.6.2001

(9 months)

(12 months)

397.22

554.61

0.31

0.28

Operating Profit before Interest & Tax

76.77

95.77

Less: Interest

26.93

44.01

Gross Profit

49.84

51.76

Less: Depreciation-on cost

22.09

25.65

Less: Depreciation on Revaluation

21.03

28.08

Dividend for 2001-02 as under:

planned. This translated in lowest stock of clinker

(Rs. in cr)

a) On 9% Redeemable Cumulative
Preference Shares
(pro-rata for 9 months)

0.51

b) On 7.5% Redeemable Cumulative

Preference Shares
(pro-rata for 9 months)

0.42

c) On Equity Capital @ Re. 1/- per share

3.48

not reached the levels to enable the manufacturers

Your company's performance in 2001-02 was

4.41

figures are -

28.08

Profit Before Tax

6.72

26.11

Less: Provision for taxation

3.11

0.00

Less: Provision for deferred tax

2.14

Not Required

Profit after tax and deferred tax

1.47

26.11

Add: Balance brought forward from previous year

3.20

0.58

during 2001-02. The demand in North Indian

Add: Debenture Redemption Reserve no longer required

19.43

0.00

markets catered to by your company grew at 15%

Profit available for Appropriation

24.10

26.69

paid subject to the deduction of tax at source.

Particulars

Cement Industry - 2001-02

Clinker Production (Lac M.T.)

16.25

Cement Production (Lac M.T.)

18.06

The cement industry grew at a healthy rate of 9.4%

as against national average of 9.7%. The

production during the year reached 102.4 million

Not Required

10.88

tonne as against 93.61 million tonne in the previous

On Cumulative Redeemable Preference Shares

0.93

1.91

year. The capacity utilization stood at 79%. In North

On Equity Shares @ Re.1/- per share

3.48

3.48

India the increase in production was a result of pro-

Not Applicable

0.55

active de-bottlenecking of existing plants resulting

10.10

6.67

9.59

3.20

Tax on Distribution of Dividend (Pref../Equity)

General Reserve
Balance Carried forward

satisfactory. The production and capacity utilization

The dividend upon approval by members, would be

0.00

Debenture Redemption Reserve

earn a reasonable return on their invested capital.

Performance of your company

Add: Transfer from Revaluation Reserve

Appropriation:

Prices during 2001-02 have also shown

improvement. However, the price levels have still

on 3,48,37,225 shares of Rs. 10/- each.

Total

and cement at the year end over past five years.

in higher cement production.

2001-02
(July to March)

Capacity Utilization

107 %

The production facility optimization programme of

the company to increase its capacity from 2 million
tonnes to 2.6 million tonnes was carried out in the
period under review. Your company could
successfully commission the expansion programme
almost three weeks before schedule on 10th
December 2001 as against targeted completion of
31st December 2001.

Such normal growth in cement demand augured

The use of alternative fuel also took sometime to

60

61

establish. Your directors take the pleasure to report

that the company has successfully substituted the
traditional fuel with petroleum residue.

tax, which have been introduced this year only.

OVER NEXT FEW YEARS, CEMENT

DEMAND IS EXPECTED TO

Your directors have proposed equity dividend of

Rs.1/- per share for the 9 months period.

Understandably both the said activities required

intermittent shutdowns. In-spite of this, your
company could achieve capacity utilization of
107%. The advantage of additional capacity and
alternative fuel should be fully available in the year
2002-03. It shall further hone the competitive edge
of your company.

Finance
reengineered its debt profile. Various steps were
taken to bring the cost of capital of the company in
line with prevalent rates for both long-term and
short-term debts.

Your company was conferred the coveted National

Energy Efficiency Awards instituted by National
Council for Cement and Building Materials by the
Ministry of Commerce and Industry, Government of
India, in recognition of the "Best Electrical Energy
Performance" and the "Best Thermal Energy
Performance" for year 2000-01. This is duly
exemplified in the low energy consumption per ton
of cement produced by your company. Your
company is bagging energy awards since 1997.
The gross profit for the 9 months period ended
31st March 2002 was Rs. 49.84 crore as against
Rs. 51.76 crore in the 12 month ended on 30th
June 2001. The net profit declined due to non cash
charges of revaluation depreciation and deferred

GROW

In the era of low interest rates, your company also

The futuristic and environmental friendly

AT AROUND 1.5 TIMES THE ANNUAL

ESTIMATED GDP GROWTH RATE OF
6% PER ANNUM

programme for using refinery residue in place of

traditional fossil fuel was submitted for appraisal to
the World Bank. The World Bank vetted the
scheme and lauded the company's efforts. In
appreciation of your company's efforts, the World
Bank granted interest subsidy to your company on

higher coupon rate worth Rs.41.64 crore. New long

In a commodity industry, selling prices are always

Rs.26 crore term loan syndicated from ICICI Bank

term loans of Rs. 25 crore were raised at or around

susceptible to vagaries of external factors not

Ltd.

PLR. The consortium of commercial banks

entirely in control of the industry. The mantra for

financing your company have agreed to extend long

long term sustainable profits are constant

term loans for the Captive Power Project at or

endeavors for cost reductions.

Your company was awarded highest credit rating

PR1+ for its short term debt. Your company
expects to raise funds at attractive low rates
because of this rating.
Your company repaid the old long term loan having

around PLR rates.

Your company has with a mix of FCNR(B) loans,

production substantially by completing its 36 MW

MIBOR linked debentures and commercial paper

Captive Thermal Power Project. The Power project

successfully raised its entire working capital loans

is likely to be completed on schedule.

at sub PLR rates.

YOUR COMPANY WAS CONFERRED THE

COVETED NATIONAL ENERGY
EFFICIENCY

AWARDS

INSTITUTED BY NATIONAL COUNCIL FOR

CEMENT AND BUILDING MATERIALS

62

Your company will be able to reduce the cost of

Your company has chosen rationalization in cost of

The payoff from some of these initiatives was

transportation as one of the thrust area for the year

already evident in 2001-02. The interest outflow

2002-03. Premier management institution - Indian

declined from 7.93% of turnover in 2001-02 to

Institute of Management, Ahmedabad - has been

6.77% of turnover in 2001-02.

commissioned to study and suggest strategic plan

Prospects for 2002-03 and beyond

for monitoring your company's transportation

logistics.

United Nations has projected India as the 2nd

Various steps have been taken to improve the

largest growing economy in the world. The GDP

quality of cement. Raw material mix has been

growth rate should be more than 6% per annum in

upgraded which shall lead to marginal increase in

the coming years. Demand of cement should grow

raw material cost. However, better quality and high

at around 1.5 times the GDP growth rate baring

exceptional circumstances.

value added products should more than

compensate the increase in cost. New products

In north India, no new capacities are in pipeline.

like SHREE ULTRA Ash Free Cement and Red

This should further shift the demand supply

Oxide Cement have already been test marketed by

equilibrium in favour of the cement producers.

your company and invoked encouraging response.

63

Mr.Alyque Padamsee has been retained for

scheme Jo soche woh Paave wherein

advising on brand equity. He has also been

suggestions from all strata of the organization are

mandated to formulate a proper strategy for print

invited, evaluated and rewarded according to its

and electronic media publicity.

technical, social and economic viability. This has

Your company has made a distinct shift of focus

handsomely rewarded the company.

from large institutional buyers to market oriented

These improvements will be strengthened over the

retail sales. The selling ratio has changed from

foreseeable future. Decision-making was

earlier 50:50 to almost 60:40. This should translate

progressively decentralized. Business processes

into better sales price and healthier bottomline.

were evolved to empower managers to respond

Your directors are confident that better quality and

faster to changes in the marketplace.

high valued added products with lower

The information required under Section 217(2A) of

manufacturing costs and better customer profile

the Companies Act, 1956 read with the Companies

should go a long way in creating more value for

(Particulars of Employees) Rules, 1975 is annexed

shareholders.

hereto and forms part of this Report (Annexure-I).

Human relations
Your Company's competitive edge is derived from
the quality of its people. Your company's
employees - 1187 employees as on 31st March,

FROM THE MINISTRY OF POWER

techniques of water harvesting in arid zone. His

included separately in the Annual Report and forms

During the period your company humbly

report and suggestions are being implemented for

part of Directors' Report. Your Company shall

contributed to various social projects in discharge

the benefit of all in the vicinity.

ensure that all the provisions are addressed in

of its responsibility as corporate citizen.

Your company continued to closely monitor the

engineering, marketing, finance and other

Your company sponsored a free eye camp at plant.

disciplines. During the period under review, your

Over 500 persons within the rural vicinity received

company strengthened these skills through training

free eye surgery and care.

performance of its plant so that operations

remained clean. To strengthen the ecosystem, the
management developed a green belt through
aggressive tree planting.

Magasaysay awardee Mr. Rajendra Singh was

The company has also implemented a novel

AWARDS

Responsible corporate citizen

2002- possess diverse skills in manufacturing,

initiatives across various disciplines.

YOUR COMPANY BAGGED THE

COVETED NATIONAL ENERGY
CONSERVATION

invited to the plant to advise on the various modern

Blood donation camp is a regular event at your

letter and spirit. The Auditors have also certified

your company's compliance with the said code.

Directors
Shri Agnivesh Agarwal and Shri R.S. Agarwal joined
the Board of the Company.

company and various employees are enlisted with

Shri R.L. Gaggar and Shri S.K. Somany, Directors,

local hospitals for emergency blood donation.

retire by rotation at the forthcoming Annual General

Your company has always come forward with

humble contributions in the event of any local or
national calamity recent examples being Gujarat
earthquake and Orissa cyclone.

Meeting in accordance with the provisions of the

Companies Act, 1956 and Company's Articles of
Association and being eligible, offer them for reappointment.
Shri B.G. Bangur has been appointed as Executive

DISTINCT SHIFT OF

FOCUS

FROM INSTITUTIONAL
BUYERS TO RETAIL SALES

Corporate governance
All the statutory requirements with regard to
corporate governance were fully implemented.

Shri H.M. Bangur as Managing Director effective

from 1st August,2002 by the Board for a further
period of five years, at the remuneration decided by

In appreciation of its corporate governance

the Remuneration Committee.

practices, the Institute of Chartered Accountants of

India, Jaipur has conferred Best Annual Report
Award for 2000-01 to your company.

Shri M.K. Singhi, who joined the company in

January,1995 as President has been co-opted on
the Board on 26.4.2002 and appointed as Executive

The report on Corporate Governance has been

64

Chairman effective from 13th August,2002 and

Director for a period of three years effective from

65

26th April, 2002 at the remuneration decided by the

and prudent to as to give a true and fair view of the

Remuneration Committee. The term of

state of affairs of your Company at the end of the

appointment of Shri M.K. Singhi as additional

financial year and of the profit of your Company for

director shall expire at the ensuing annual general

that period.

meeting in accordance with the provisions of the

Companies Act,1956 and Articles of Association of
the company and being eligible offers himself for
re-appointment.

WE HAVE CREATED A NEW

COMPANY. AND IN THE PROCESS

BEATEN

They had taken proper and sufficient care for the

maintenance of adequate account records in
accordance with the provisions of this Companies

THE ECONOMIC SLOWDOWN WITH

A BETTER PERFORMANCE.

Act, 1956, for safeguarding the assets of your

The Board recommend to the members reappointment of retiring directors and approval of
appointment and remuneration of whole-time
directors.

Company and for preventing and detecting fraud

and other irregularities.
The annual Accounts were prepared on a going
concern basis.

Directors responsibility statement

Your Company's Statutory Auditors, M/s. B.R.

Maheshwari & Co., Chartered Accountants, have

The Directors confirm that they have taken all

reasonable steps, as are required, to ensure that in
the preparation of the annual accounts for the

audited the financial statements in accordance with

generally accepted auditing standard and practices
as indicated in their report.

period ended 31st March, 2002 and that The applicable accounting standards had been
followed and in case of material departures, the
proper explanation has been given in the Accounts
and notes thereon.

Auditors
M/s. B.R. Maheshwari & Co., Auditors of your
company, will retire at the forthcoming Annual

Board of Directors to fix their remuneration.

General Meeting and are eligible for re-

The observation of the Auditors together with

They had selected such accounting policies and

appointment. The Directors recommend their re-

Notes on Accounts are self-explanatory and do not

same were applied consistently, and that they

appointment for 2002-03. The members are

require any further explanation.

made judgments and estimates that are reasonable

requested to appoint the Auditors and authorize the

The subsidiary company is yet to start commercial

operations. The subsidiary had negligible expenses
and therefore the Accounts have not been
consolidated. However, separate financial
statements of the subsidiary have been attached.

Cost Audit
The Cost Records of your Company in respect of
Cement for the period ended 31st March, 2002 are

Conservation of Energy, Technology

absorption and Foreign Exchange
Earning/Outgo

being audited by M/s. Tholiya & Associates, Cost

Auditors.

The information required under Section 217(1)(e) of

the Companies Act, 1956 read with Companies

THE INSTITUTE OF CHARTERED

ACCOUNTANTS OF INDIA, JAIPUR
HAS CONFERRED

BEST

ANNUAL REPORT AWARD FOR 200001 TO THE COMPANY

66

Subsidiary

(Disclosure of particulars in the report of the Board

of Directors) Rules, 1988 is annexed hereto and

As required under section 212 of the Companies

forms part of this Report (Annexure-II).

Act, 1956 and the Audited Balance Sheet and Profit

& Loss Account along with Directors' Report for

On behalf of the Board

the period 11.2.2002 (date of incorporation) to

31.3.2002 of Shree Cement Marketing Limited, a
subsidiary of your company are annexed hereto. It
holds entire capital of company (99.86%) except

Kolkata

taken by other initial subscribers to memorandum.

26th April, 2002

B.G. Bangur
Chairman & Managing Director

67

ANNEXURES
to the Directors report

Annexure - II
Disclosure of particulars with respect to conservation of energy, technology absorption and foreign exchange earnings and outgo as required under Companies
(Disclosure of Particulars in the report of the Board of Directors) Rules, 1988 and forming part of Directors' Report for the period ended 31st March, 2002.

(A) Conservation of Energy

(a)

Measures taken for Conservation of Energy

1.

Installation of Fly Ash handling storage & feeding system.

2.

Replacement of 2 nos. Cooler fans with higher efficiency fans.

3.

Incorporation of pre-ground clinker feeding system in cement mill.

STATEMENT OF PARTICULARS OF EMPLOYEES PURSUANT TO THE PROVISIONS OF SECTION 217(2A) OF THE

4.

Installation of capacitors to conserve energy and improve power factor

COMPANIES ACT, 1956 READ WITH THE COMPANIES (PARTICULARS OF EMPLOYEES) RULES, 1975 AND FORMING

5.

Reducing leakage of compressed air

PART OF THE DIRECTORS' REPORT FOR THE PERIOD ENDED 31ST MARCH, 2002.

6.

Automation of Limestone Hopper's equipments.

7.

Minimizing idle running of equipment.

8.

Optimization of plant operation.

Annexure - I

Sl. Name of the

Designation/Nature

No. Employee

of Duties

Remuneration

Qualification

Age

Experience

Date of

Last Employment

Commence-

(b)

ment of

Name of the

employment

Organisation

Position held

(A) EMPLOYED THROUGHOUT THE PERIOD AND WERE IN RECEIPT OF REMUNERATION IN AGGREGATE OF NOT LESS THAN RS. 12,00,000/- PER ANNUM
1.

Bangur B.G.

Chairman &

1,827,100

B.Com.

68

49

13.8.92

Managing Director

Jt. Managing

1,771,000

B.E. (Chem.)

50

24

1.1.92

Director

Up-gradation of PLC system.

3.

Installation of online energy monitoring system.

4.

Installation of SPRS for Raw Mill ESP Fan.

Chief Executive

5.

Installation of Energy saver for Air conditioners .

a division of

(Prod.& Develp.)

6.

Installation of VFC for process fans.

(c ) Impact of measures taken at (a) and (b) above for reduction of energy consumption and consequent impact on cost of production of goods.

Cement Co. Ltd.

Bangur H.M.

Installation of 36 MW Captive Thermal Power Plant.

2.

Hasting Mill -

Shree Digvijay

2.

Additional Investments and proposals, if any, being implemented for reduction of consumption of energy.
1.

Shree Digvijay

i)

The coal consumption at 9.47% of clinker during the period, as in last year continues to be lowest in the country and has been maintained by
continuous efforts put in for implementing energy conservation measures

Financial Advisor
ii)

Cement Co. Ltd.

Power Consumption per tonne of Cement has marginally increased to 79 Units in 2001-02002 from 78 units in 2000-01 due to higher blaine of
product and trials for Capacity enhancement.

3.

Singhi M.K.

President

1,702,220

B.Sc., L.L.B.,

50

24

17.1.95

F.C.A.

Rajshree Cement-

Sr. Vice President

a Unit of Indian

(Commercial)

Rayon & Industries Ltd.

4.

Bhandari Ashok

Group Financial

1,214,120

Advisor

B.Sc. (Hons.),

49

24

1.4.90

F.C.A.

PT Indo Rama

(B) Technology Absorption

Vice President

Payal Diwakar

Sr. Vice President

(Mktg.)

659,236

B.Tech,

Information given in the prescribed Form B annexed.

Synthetics

(C) Foreign Exchange Earnings And Outgo

(B) EMPLOYED FOR PART OF THE YEAR AND WERE IN RECEIPT OF REMUNERATION AT THE RATE OF RS. 1,00,000/- PER MONTH.
1.

(d) Total Energy consumption and energy consumption per unit of products.(information given in the prescribed Form A annexed).

44

20

23.10.01

PGDM

Gujarat Ambuja

Vice President

Cements Ltd.

(Mktg.)

(a)

Activities relating to export, initiatives taken to increase export, development of new export market for products and services and export plans.
Export was not viable during the period.

NOTES:

(b)

Total foreign exchange used and earned:

(Rs. in Lac)

1)

All appointments are non-contractual and terminable by notice on either side except in the case of Whole-time Directors.

2)

Remuneration includes Salary, Allowances, value of perquisites and Company's Contribution to Provident and Superannuation Funds but excludes
contribution to Gratuity Fund on the basis of actuarial valuation as separate figures are not available.

3)

Current Period

Previous Year

ended 31.3.2002

ended 30.6.2001

( 9 months)

(12 months)

107.47

2887.39

Nil

Nil

None of the employees is related to any director of the Company except :

Used
( a) Shri B.G. Bangur who is related to Shri H.M. Bangur and Shri Agnivesh Agarwal.

Earned

( b) Shri H. M. Bangur who is related to Shri B.G. Bangur and Shri Agnivesh Agarwal.
On behalf of the Board

On behalf of the Board

Kolkata
Kolkata
26th April, 2002

68

B.G. Bangur

26th April, 2002

B.G. Bangur

Chairman & Managing Director

Chairman & Managing Director

69

Annexure - II

Annexure - II

Form A

Form B

(See Rule 2)

(See Rule 2)

Form for Disclosure of Particulars with respect to Conservation of Energy

Form for Disclosure of Particulars with respect to Technology Absorption

(A) Research And Development (R&D)

(A) Power And Fuel Consumption

Current Period

1.

Previous Year

ended 31.3.2002

ended 30.6.2001

( 9 Months)

(12 Months)

1) Specific area in which R& D is

carried out by the Company

Purchased
Unit (Kwh in lacs)

1061.49

1772.74

Total amount (Rs. in lacs)

4448.72

7820.63

Rate/Unit (Rs.)
b)

4.19

2)

Benefits derived as a result of

4.41

Through Diesel Generators

Unit (Kwh in lacs)

350.39

32.10

Unit per Ltr. of L.D.O/Diesel

3.60

3.56

Cost/Unit (Rs.)

3.33

4.35

3.

Heat Mass balance of Pre-heater, Kiln, Cooler system

4.

Optimization of Raw mix design

1. Maintaining the competitive advantage in the market due to

the above efforts

Own Generation
i)

Development of IRST-40 grade cement for Railway sleepers.

Particle size distribution study for optimization of cement mill
operation and improvement in the quality of product.

Electricity
a)

1.
2.

3)

Future plan of actions

better quality of cement.

2.

Conservation of resources and reduction in production cost.

3.

Promoting the utilization of industrial waste.

1.

Investigation and research on low cost alternative fuel.

2.

Further improvement in raw mix design and quality of clinker

and cement.

ii)

Through Steam turbine/Generator

Unit (Kwh in lacs)

2.

83.64

82.03

Unit per Kg. of Coal

0.68

0.92

Cost/Unit (Rs.)

3.10

4.05

1.54

2.00

Total cost (Rs. in lacs)

3101.77

4668.70

Average rate per MT (Rs.)

Use of waste exhaust gases.

4.

Investigations to identify problematic area & suggesting remedial

measures.

Coal used as a fuel in Kiln & Calciner

Quantity (in lac MT)

2016.09

2332.99

3.

Furnace Oil

N.A.

N. A.

4.

Others / Internal Generation

N.A.

N.A.

4.

1.
Standard

Current

Previous

(if any)

Period

Year

105-110

79

78

N.A.

N.A.

N.A.

20.00

9.47

9.47

Product: Cement
Unit : MT
Electricity (Kwh /MT of Cement)
Furnace Oil
Coal (% of clinker)

Expenditure on R& D

(Rs. in lac)

a)

Capital Expenditure

4.77

b)

Recurring Expenditure

c)

Total Expenditure

143.67

d)

Total R& D Expenditure as a per centage of turnover

0.36 %

138.90

(B) Technology Absorption, Adoption and Innovation.

(B) Consumption per Unit of Production

70

3.

Efforts in brief, made towards technology absorption, adoption and innovation.

The company has been in constant touch with the main plant designer and suppliers, Refractory suppliers, Consultants and others
to keep abreast of latest technological developments, innovations in the field of Cement technology advancement in various
disciplines such as raw mix design, homogenizing, refractories, pollution control, energy conservation, plant automation, upgradation & use of alternate fuel.
Indian consultants have also been given the assignments related to improvement of clinker quality, smooth operation of plant,
reduction in pollution etc.
Senior executives also visited various efficient cement plants in and outside India and attended seminars and workshops for
optimization of plant operations, efficient use of alternate fuels, raw mix design, thermal and electrical energy conservation.

71

FIVE-YEAR
financial highlights
Annexure - II

(Rs. in Lac)
Particulars

1997-98

1998-99

1999-2000

2000-01

2001-02
(9m)

Form B (Contd.)
2.

Benefits Derived as a result of above efforts.

Production : (Lac MTs)

Clinker

16.70

19.45

22.85

21.13

16.25

1. A unique opportunity to learn about Energy conservation methodology, approach and technologies adopted by the successful
energy efficient units

Cement

17.26

20.44

23.12

23.83

18.06

Sales (Clinker & Cement) : (Lac MTs)

17.97

22.55

24.26

25.79

18.27

83

79

75

78

79

12.94

12.79

12.34

9.47

9.47

34,278.00

44,214.50

48,456.13

55,460.48

39,721.69

2. Sharing of information by excellent energy efficient companies.

Energy Consumption :
3. Saving in thermal Energy due to successful use of alternate fuels.

Power (KWH/PT Cement)

4. Improvement in the quality of cement

Coal (% of Clinker)

5. Conservation of natural resources

3.

6. Increase in capacity utilization.

Sales

7. Enhancement in process and productivity.

Other Income

1,471.92

456.27

200.82

28.35

30.87

Total Income

35,749.92

44,670.77

48,656.95

55,488.83

39,752.56

Operating Expenses

29,996.48

37,162.67

40,519.06

45911.97

32,075.60

Information regarding technology imported during last 5 years.

a) Technology imported

1.

(Direct /through suppliers)

2.

3.

Incorporation of VICLR for optimization of Kiln, Raw mill, ESP

Operating Profit

5,753.44

7,508.10

8,137.89

9,576.86

7,676.96

performance from BHA, USA.

Interest

3,733.52

4,406.65

4,135.43

4,400.53

2,692.87

Modification of Tertiary Air Duct and II & III Stage Cyclones to

Profit before Depreciation & Tax

2,019.92

3,101.45

4,002.46

5,176.33

4,984.09

L.P. Cyclones

Add : Transfer from Revaluation Reserve

2,809.09

2,808.02

Letchlar Water Spray System in GCT.

Less : Depreciation

1,114.54

2,514.11

5,276.89

5,372.85

4,312.56

905.38

587.34

1,534.66

2,611.50

671.53

51.28

4.72

310.41

214.37

854.10

582.62

1,534.66

2,611.50

146.75

3,483.72

3,483.72

3,483.72

3,483.72

3,483.72

EPS (in Rupees)

2.45

1.67

4.41

6.89

1.03

Cash EPS (in Rupees)

5.65

8.89

11.49

14.86

17.89

Net Block

39,654.52

37,422.76

36,927.91*

40,118.82*

45,038.73*

Shareholders Funds

19,056.86

19,654.48

21,939.14*

24,705.98*

21,560.59*

Total Capital Employed

49,248.09

48,431.37

55,708.61*

56,588.12*

51,048.51*

4.48

2.96

7.00

10.57

15.24

12.55

15.26

15.40

16.94

19.02

4. Installation of BHA Controller in ESP.

Profit before Tax

Tax

b) Year of Import.

: 1999-2000

2000-2001

2001-2002

1997-1998

Deferred Tax

c) Has technology been fully absorbed

d) If not fully absorbed, areas where this has not
taken place, reasons thereof and future plan
of action

Yes
N. A.

Profit after Tax

Equity Capital

Return on Net Worth (%)

Return on Capital Employed (%)
* Net of Revaluation

72

73

FIFTEEN-YEAR
financial highlights

CORPORATE
information
Basic information you
might need to know

FINANCIAL PERFORMANCE DURING LAST 15 YEARS

Year

PBIDT

INTEREST

PBDT

DEPN.

PBT

TAX

PAT

1986

1,322.21

665.64

656.57

542.20

114.37

114.37

1987

1,273.78

731.36

542.42

672.32

(129.90)

(129.90)

1988-89*

1,486.64

716.24

770.40

725.37

45.03

0.15

44.88

1989-90

1,453.56

638.00

815.56

811.66

3.90

3.90

1990-91

2,800.95

602.84

2,198.11

857.73

1,340.38

0.02

1,340.36

Board of Directors

Bankers

1991-92

3,330.66

545.31

2,785.35

880.82

1,904.53

318.00

1,586.53

Shri B. G. Bangur, Chairman & Managing Director

State Bank of Bikaner & Jaipur

1992-93

2,089.02

627.52

1,461.50

904.47

557.03

113.70

443.33

Shri H. M. Bangur, Jt. Managing Director

State Bank of India

1993-94

2,057.76

431.76

1,626.00

227.43

1,398.57

233.00

1,165.57

1994-95

3,246.37

555.79

2,690.58

60.32

2,630.26

404.00

2,226.26

Shri R.L. Gaggar

1995-96

5,340.14

755.85

4,584.29

446.31

4,137.98

805.00

3,332.98

Shri O.P. Setia

1996-97*

4,346.59

575.82

3,770.77

725.90

3,044.86

252.00

2,792.86

Shri S.K. Somany

1997-98

6,012.02

3,992.10

2,019.92

1,114.54

905.38

51.28

854.10

1998-99

7,508.10

4,406.65

3,101.45

2,514.11

587.34

4.72

582.62

Union Bank of India

Management Consultant

Shri R. S. Agarwal

1999-00

8,152.89

4,144.43

4,008.46

2,467.80

1,540.66

6.00

1,534.66

2000-01

9,576.86

4,400.53

5,176.33

2,564.83

2,611.50

2,611.50

Shri M.K. Singhi, Executive Director

10,235.95

3,590.49

6,645.45

2,945.69

3,699.76

310.41

3,389.35

ABSOLUTE

15 YRS

7.741544

5.394047

10.121470

32.349043

29.634957

NO. OF

10 YRS

3.073249

6.584316

2.385859

1.942611

2.136329

TIMES

5 YRS

2.354936

6.235401

1.762361

1.215082

1.213575

15 YRS

14.62%

11.89%

16.70%

26.08%

25.35%

10 YRS

11.89%

20.75%

9.08%

6.85%

7.90%

5 YRS

18.69%

44.20%

12.00%

3.98%

3.95%

Shri B.R. Gupta (Nominee IDBI)

Shri Harkirat Singh (Nominee LIC)

Management Team
Shri H.M. Bangur

Jt. Managing Director

Shri M.K. Singhi

Executive Director

Shri Ashok Bhandari Group Financial Advisor

Shri D. Payal

Sr. Vice President (Marketing)

* The figures have been annualised for this 15 month period

Shri S.S. Jain

Sr. Vice President (Technical)

** The figures have been annualised for this 9 month period

Shri S.M. Lotia

Sr. Vice President (Comm.)

** The profit after tax for the period includes Rs.2103.29 lac of revaluation depreciation and Rs.214.37 of Provision for deferred tax.

Shri V.P. Sinha

Sr. Vice President (Mines)

Secretary
Shri S.L. Bhansali

74

UTI Bank Ltd.

Shri Agnivesh Agarwal

2001-02**

CAGR

ICICI Bank Ltd.

Ernst & Young, Kolkata

Auditors
M/s. B.R. Maheswari & Co., New Delhi

Cost Auditors
M/s. Tholiya & Associates, Mumbai

Registered Office and Works

Bangur Nagar, Beawar - 305 901,
District Ajmer, Rajasthan

Corporate Office
21, Strand Road, Kolkata - 700 001
Phones : 220 9601-6, Fax : 243 4226

75

RATIOS
AND
ratio analysis
PBDIT / Turnover
20

15.00

15

11.25

10

7.50

3.75

0.00
97-98

98-99

99-2000

00-01

Cash flow / Total Income

PBDT / Turnover

01-02

97-98

PBDIT/Turnover

98-99

99-2000

00-01

20

11.25

15

7.50

10

3.75

0.00

0
98-99

99-2000 00-01

01-02

97-98

Cash flow

PBDT/Turnover

Financial Performance Ratios

Financial ratios

98-99

99-2000 00-01

01-02

ROCE

50 per cent of the total turnover to around 60 per

cent in 2001-02.

Jun-98

Jun-99

Jun-00

Jun-01

Mar-02

Shree's raw material costs as a percentage of sales

100.00

100.00

100.00

100.00

100.00

increased marginally from 9.04 in 2000-01 to 9.63

Interest, one of the biggest cost component in the

Other income / Turnover (%)

0.59

1.03

0.41

0.05

0.08

in 2001-02. As the company's accounting year

cement industry, declined for the company during

Raw material costs / Sales (%)

8.11

9.16

9.59

9.04

9.63

changed from July-June to July-March, the working

the last financial year - from 7.93 per cent in

Manpower costs / Turnover (%)

3.51

3.31

3.03

2.99

3.41

from the peak months of April-June were excluded.

2000-01 to 6.78 per cent in 2001-02. The company

17.50

15.69

15.45

15.82

16.04

This caused sales to dip marginally.

leveraged the low cost economy and re-negotiated

1.82

2.26

1.79

1.99

3.03

Freight, handling and selling cost / Turnover (%)

21.13

19.23

19.98

21.46

21.46

Interest / Turnover (%)

11.23

9.97

8.53

7.93

6.78

PBDIT / Turnover (%)

16.92

16.98

16.79

17.27

19.33

PBDT / Turnover (%)

5.68

7.01

8.26

9.33

12.55

Depreciation / Turnover (%)

3.14

5.69

5.09

4.62

10.86

Tax / PBT (%)

0.14

0.01

Nil

Nil

46.22

Net profit / Turnover (%)

2.40

1.32

3.17

4.71

0.37

Cash flow / Turnover (%)

5.54

7.01

8.26

9.33

12.55

15.26

15.40

16.94

Domestic Turnover / Turnover (%)

Excise / Gross sales (%)

Adm. expenses / Turnover (%)

interest rates for long-term loans at 13.5 per cent

Manpower costs as a per cent of total income
increased from 2.99 per cent to 3.41 per cent in
2001-02 due to the increased recruitment of
professionals and marketing executives in line with
the company's evolution from a production-focused
company to a market-driven organisation. .

and raised fresh loans at 11.30 per cent. It availed

working capital loans at sub-PLR rates. As a result,
the company's average cost of funds declined from
16.50 per cent in December, 1998 to 12.31 per
cent as on 31.3.2002. The company completely
wrote off the one-time pre-payment premium of

Freight, selling and advertisement expenses as a

Rs 2.85 cr paid to banks and financial institutions to

11.77

per cent of total turnover increased from 19.98 per

avail of a reduction in interest rates.

19.02

cent in 1999-2000 to 21.46 in 2000-01 and 2001-02

PBDIT as a per cent of turnover increased from

Capital output ratio (Total Turnover/

on account of the increased thrust on advertising

17.27 per cent in 2000-01 to 19.33 per cent in

Average capital employed) (%)

and marketing to promote the brand and drive retail

2001-02. Margins increased from 9.33 per cent in

2000-01 to 12.55 per cent in 2001-02, indicating a
better performance. The company's net profit

ROCE (PBDIT / Capital employed) (%)

Research spending/ Total turnover (%)

Value added / Total revenue

76

15.00

97-98

01-02

ROCE (PBDIT/capital employed)

74.22

89.84

91.72

98.11

98.41

0.17

0.18

0.23

0.19

0.36

offtake. The impact of this was visible during the

90.94

88.13

89.50

83.90

84.97

period under review: retail sales increased from

77

60

as a per cent of turnover decreased from 4.71 per

Return on capital increased from 16.94 per cent in

cent to 0.37 per cent in 2001-02 as it retained profit

2000-01 to 19.02 per cent in 2001-02 because the

of Rs 21.03 cr by providing depreciation on assets

average capital employed by the company in the

as revalued in the Profit and Loss Account.

business dropped substantially, thanks to a

45

Growth in PBDIT
30

repayment of loans and debentures.

Cash flow as a per cent of total income increased

50.0

from 9.33 per cent in 2000-01 to 11.77 per cent in

15

2001-02.
37.5

0
25.0

Debt-equity ratio

Debtors Turnover (days)

50.00

2.0

12.5
41.25

1.5

Growth in cash flow

0.0

1.0

97-98

32.50

98-99

99-2000

00-01

97-98

01-02

Growth ratios

23.75

0.0

15.00
97-98

98-99

99-00

00-01

01-02

97-98

Debt-equity ratio

Balance sheet ratios

98-99

99-00

00-01

01-02

01-02

1997-98

1998-99

1999-00

2000-01

2001-02

Growth in Sales (%)

36.33

28.99

9.59

14.46

-4.50

Growth in PBDIT (%)

10.65

30.50

8.39

17.68

28.38

Growth in PAT (%)

-75.97

-31.79

163.41

70.17

-94.38

Growth in cash flow (%)

-55.87

53.54

29.05

29.33

20.39

Debtors turnover (days)

1997-98

1998-99

1999-00

2000-01

2001-02

1.38

1.25

1.28

1.07

1.03

48.43

42.06

43.39

26.86

Debt-equity ratio*
Debtors turnover (days)

In 2001-02, the company's turnover dropped by

Interestingly, the company recorded a 28.38 per

20.72

4.50 per cent (annualised) and profit after tax

cent growth in its PBDIT and a 20.39 per cent

growth in its cash flow reflecting the strong
financial position of the company.

55.67

37.28

50.30

22.85

28.30

dropped by 94.38 per cent. The companys profit

Current ratio

2.48

2.72

3.17

2.66

2.24

was lower as it retained profit of Rs 21.03 cr by

Quick ratio

1.66

1.83

2.27

1.98

1.76

providing depreciation on asstes as revalued in the

Cash and equivalents / total assets

1.69

2.12

1.21

2.39

0.72

Profit and Loss Account.

Depreciation for the year / gross block*

2.27

5.20

4.91

4.65

4.73

65.05

81.35

77.35

88.54

84.78

Inventory turnover (days)

Asset turnover (Total Income / total assets)*

* without considering revaluation

Share related data

1997-98

1998-99

1999-00

2000-01

2001-02

Earnings (Rs per share)

2.45

1.67

4.41

6.89

1.03

Cash Earnings (Rs per share)

5.65

8.89

11.49

14.86

17.89

1.00

54.70

56.42

60.82

66.61

1.00
57.58*

Dividend (Rs per share)

Book value (Rs per share)
Face value Rs 10/- each

The debt-equity ratio declined from 1.07 in 2000-01

and carry system and incentives for timely

to 1.03 in 2001-02 due to repayment of loans.

remittance. The inventory turnover stood at 28.30

* After provision for deferred tax

The company reduced debtors' turnover from 26.86

days in 2001-02, substantially lower than the

The companys earnings per equity share

Rs 14.86 to Rs 17.89 in 2001-02 on account of

days in 2000-01 to 20.72 days in 2001-02 by

industry average.

decreased from Rs 6.89 in 2000-01 to Rs 1.03 in

higher margins. The company decleared dividend of

2001-02. Cash earning per share increased from

Rs 1.00 per share for the 9 month period.

moving from the erstwhile credit system to an cash

78

00-01

99-2000

Growth in cash flow

Growth in PBDIT

0.5

98-99

79

CORPORATE
governance

THE BOARD CONSIST OF EMINENT

PERSONS WITH CONSIDERABLE
PROFESSIONAL

1. Company's philosophy on code of

Governance

2. Board of Directors

The Basic philosophy of the company towards

Chairman & Managing Director. The Board consist of

Corporate Governance is to protect and enhance the

eminent persons with considerable professional

long term value of all the stakeholders - shareholders,

expertise in industry and fields such as banking, law,

customers, creditors and employees. The Company

marketing & finance. The Board has ten directors of

is committed to achieve these objective within

which seven are non executive and independent

regulatory frame work through transparency in

meeting the requirement of the Code of Corporate

dealings.

Governance. There is no pecuniary relationship or

The Company believes in the creative abilities of its

people and lays a strong emphasis on team building,

BANKING, LAW, MARKETING & FINANCE

Company.
During the period under review, four Board Meetings

ahead. The Company is committed to benchmarking

were held on 24th July,2001, 31st August,2001, 24th

itself with global standards in all areas. It maintains

October,2001 and 17th January,2002. The details of

Quality standards by manufacturing to specifications,

the attendance of each Director at the Board

The previous Annual General Meeting of the

Committees of other Companies, in which

Company was held on 24th October, 2001 and was

Company's Directors are Members/Chairman have

attended by five directors viz Shri B.G. Bangur, Shri

been disclosed by them to the Board.

H.M. Bangur, Shri R.L. Gaggar, Shri O.P. Setia and

Shri Harkirat Singh.

Meetings held during the period are as follows :

Details of directorship held in the Board or Board

satisfaction.

S.N Name of Director

IN INDUSTRY AND FIELDS SUCH AS

transaction of the non executive directors with the

motivation and to perform differently - to stay

pricing, delivery and reliability for full customer

EXPERTISE

The Board of Directors is headed by Shri B.G. Bangur,

Category

No. of Board
Meetings attended

Directorship held in No.

of other Companies
Public

Private

The details of Remuneration package, fees paid etc.

to directors for the period ended 31st March, 2002,
for information of members, is given hereunder:

(a) Paid to Non-executive Directors:

S.N. Name of Director

Sitting fees
Paid ( Rs.)

1.

Shri B.G. Bangur

Chairman & Managing Director

2.

Shri H.M. Bangur

Jt. Managing Director

Shri R.L. Gaggar

15,000

Shri S.K. Somany

2,500

3.

Shri R.L. Gaggar

Independent Director

13

4.

Shri S.K. Somany

Independent Director

12

Shri O.P. Setia

5.

Shri O.P. Setia

Independent Director

Shri Agnivesh Agarwal

6.

Shri Agnivesh Agarwal

(Appointed on 24.7.2001)

Independent Director

Shri R.S.Agarwal
Independent Director
(Appointed on 24.10.2001)

8.

Shri B.R. Gupta

Nominee Director (IDBI)

9.

Shri Harkirat Singh

Nominee Director (LIC)

Not Applicable

10. Shri M.K. Singhi

(appointed on 26.4.2002)

Executive Director

2,500

(Appointed on 24.7.2001)
5

7.

20,000

Shri R.S.Agarwal

Shri B.R. Gupta

Except sitting fees for meeting of

Board or its Committees, nonexecutive directors are not paid any
salary, benefits, bonuses, stock
options, pension etc. There is no

Nil

(Appointed on 24.10.2001)
6

Remarks

contract, Notice period or

severance fees applicable. Stock

5,000

Shri Harkirat Singh

10,000

Total

55,000

Option details is not applicable as

same not issued to them.

No director is relative of any other director, except Shri Agnivesh Agarwal who is relative of Shri B.G. Bangur
Shri B.G. Bangur has been appointed as Executive Chairman & Shri H.M. Bangur as Managing Director

and Shri H.M. Bangur.

on 26.4.2002.

80

81

(b) Paid to Executive Directors/ whole time directors:

Notes : 1. Shri B.G. Bangur is related to Shri H.M. Bangur & Shri Agnivesh Agarwal and Shri H.M. Bangur
SN.

Particulars

Shri B.G. Bangur

Shri H.M. Bangur

Chairman and

Jt. Managing Director

2. Pending Approval of Central Government of increased Remuneration, the provision has been

Managing Director
(i)

Remuneration: (for 2001-02 ) *

Rs.

Rs.

Salary

9,70,000

9,40,000

Contribution to PF& SPF

2,61,900

2,53,800

Benefits- Allowances/perks

5,95,200

5,77,200

Bonuses
Stock options

Pension

18,27,100

17,71,000

Total

(ii)

is related to Shri B.G. Bangur & Shri Agnivesh Agarwal.

made for the current period to the extent of monetary limits for Minimum Remuneration as per
Schedule XIII of the Act.
3. As Shri M.K. Singhi was appointed on 26.4.2002,details of remuneration paid for period ended
31st March, 2002 are not applicable.

* for period of 9 months

3. Committees of Board of Directors

Details of Fixed Component and performance

The Board has constituted Committees of Directors

linked incentives along with the

to deal with matters and to monitor the activities

performance criteria:( as approved by

falling within the terms of reference as follows:

Auditor any significant findings and follow-up

thereon,
e) Reviewing the Company's Financial and Risk
Management Policies.

members in meeting dated 24.10.2001)

(a) Fixed Component:
-Salary- per month
-Contribution to PF & SPF

( Rs. per month)

2,75,000
As per Rules

(Rs. per month)

2,50,000
As per Rules

( presently 12% & 15% of salary)

-Perks and other allowances

2,47,500

2,25,000

(ceiling of 90% of Salary)

(b) Performance Linked Incentive:

Commission
(Based on Net Profit for the year within the
individual/ overall ceiling for managerial
remuneration from time to time)

(c) Minimum Remuneration

in case of inadequacy of profits in any year
as calculated under section 198/349 of the
Act.

(iii)

Service Contracts, notice period, severance fees:

Both the appointments are contractual and no
notice period or severance fees except Gratuity
and encashment of leave at the end of tenure is
prescribed.

(iv

82

Stock Option details, if any, and whether the

same has been issued at discount as well as the
period over which accrued and over which
exercisable

Within the ceiling of

Schedule XIII as
amended from time to
time or such amount as
per approval of the
Central Government.
The appointment is for
five years period i.e till
12th August, 2002

No Stock option issued,

hence not applicable

Up to 5% of net profit by
way of Salary, perks and
Commission taken
together.

Within the ceiling of

Schedule XIII as
amended from time to
time or such amount as
per approval of the
Central Government
The appointment is for
five years period i.e till
31st July, 2002

No Stock option issued,

hence not applicable

Directors:

The terms of reference of the Audit Sub Committee

re-constituted on 1st February, 2001 by the Board in

1. Shri R.L. Gaggar, Chairman of the Committee

terms of Section 292 (A) of the Companies Act, 1956

2. Shri H.M. Bangur

and the Corporate Governance Code include :

3. Shri O.P. Setia

a) Oversight of Company's Financial Reporting

Upto 5% of net profit by
way of Salary, perks and
Commission taken
together.

The Audit Committee consist of the following

(A) Audit Committee

process,
b) To review the Annual Financial Statement
before submission to the Board,
c) To review with the management, External &

4. Shri B.R. Gupta

The Audit Committee held meetings on 24th July,
2001 & 31st August,2001 to consider the annual
results for year ending 30.6.2001 and on 17th
January,2002 to consider the half yearly financial

Internal Auditors, the adequacy of internal

results for six months ended on 31st December,2001

control systems.

before placing the same to Board. The attendance of

d) Discussions with Statutory and Internal

Name of Director / date-->

directors is as under:

24.7.2001

31.8.2001

17.1.2002

Meeting
Attended

Shri R.L. Gaggar,

Yes

Yes

No

Shri H.M. Bangur

Yes

Yes

Yes

Shri O.P. Setia

Yes

Yes

Yes

Shri B.R. Gupta

Yes

No

No

83

remuneration except meeting fees. The

commercial and financial transactions have been

Statements for the period ended 31st March,2002

remuneration of Whole-time Directors viz. Chairman

entered with Companies, where Directors are

before being placed to the Board for approval which

& Managing Director and Jt. Managing Director had

interested, the nature of interest are being disclosed

was attended by 2 members of the committee. The

been fixed by the Board in terms of resolution(s)

to the Board of Directors.

Statutory and Internal Auditors were invitees to the

passed by the members for their current tenure up

6. Information to Shareholders

meeting. The meeting was attended by the

to 12th August,2002 and 31st July,2002 respectively.

The Committee also reviewed the audited Financial

President, the Group Financial Advisor and/or Sr. Vice

President (Commercial). The Company Secretary
was in attendance at said meetings.
(B) Shareholders and investors grievances

Shri R.L. Gaggar, Chairman of the Committee

2.

Shri O.P. Setia

Ltd., Hyderabad as the Share Transfer Agent for both

Officer. The Share Transfer Agent/Company has

timely resolved complaints (total 47 complaints
received) and no complaint or grievances is pending
with the Transfer Agent and the Company or with any
of the Stock Exchanges where its shares are listed or
SEBI. The Committee meets as and when necessity
arises. The Company has paid listing fees to all the
Stock Exchanges for the period 2001-02. The Listing
fee, wherever due, has also been paid to exchanges
for year 2002-03.

and terms and conditions of re-appointment of

in the Notice calling the Annual General Meeting.

Whole-time Directors viz. Executive Chairman,

1.

Shri R.L.Gaggar - Chairman of the Committee

The information to shareholders is also given

Managing Director and Executive Director for

2.

Shri R.S. Agarwal

separately in the Annual Report.

approval by the members in the General

3.

Shri O.P. Setia

4.

Shri S.K. Somany

5.

Shri B.R. Gupta

Meeting.

7. Compliance Certificate
from Statutory Auditors of the Company is annexed

are published in newspapers only.

herewith.

d)

As to Postal ballots, there is no matter in the

ensuing meeting requiring postal ballot as per the
rules framed in this respect.

4. Board Procedure
There has not been a time gap in excess of four
months between any two meetings of the Board of

Auditors' Certificate on Corporate Governance

Directors and four meetings were held during the

period under review. The members of the Board have
been provided with the requisite information which
are relevant for review by the Board of Directors and
the same substantially complies with the
requirements of the Board of Corporate Governance.
All the directors have intimated periodically about
their directorship and membership in the various

shares held in physical form , which met 11 times

Corporate Governance Code.

To,
The Board of Directors
Shree Cement Limited
This is to certify that we, the Auditors of Shree Cement Limited, Beawar, have reviewed the compliance by the
Company of the conditions of Corporate Governance as stipulated in Clause 49 of the Listing Agreement
entered into with the Stock Exchanges and report that all the conditions contained therein have been complied
with by the Company.
For B.R. MAHESWARI & CO.

during the period of nine months.

84

The Company is presently not sending half yearly

results to Shareholders. The half yearly results

for re-appointment of whole-time directors.

permissible limits of the Companies Act, 1956 and

The Non Executive Directors are not paid any

c)

The Compliance Certificate for Corporate Governance

approve the remuneration and terms and conditions

Committee of the Board for transfers/transmission of

(C) Remuneration Committee

The Company has constituted the Remuneration

about the Directors, their expertise, remuneration etc.

committees of other companies, which are within

transfer.

b)

following independent Directors:

In addition the Company has Share Transfer

As on 31st March, 2002, no shares were pending

Company's expenses is not applicable.

Committee on 17th January 2002 consisting of the

physical and de-mat form of shareholdings. Shri S.L.

Bhansali, Company Secretary is the Compliance

issue of maintaining the Chairman's office at the

Committee for recommending the remuneration

The committee has met on 26th April,2002 to

The Company appointed M/s. Karvy Consultants

Since the Chairman is executive in capacity, the

Shareholders are being provided with information

Directors:
1.

a)

Status regarding non-mandatory

requirements:

The Board has constituted the Remuneration

committee
The Committee consist of the following independent

For appointment/re-appointment of Directors,

Chartered Accountants

5. Management Discussion and Analysis

Report
The matters that are required to be discussed under
the Management Discussion and Analysis Report

Kolkata
26th April,2002

SUDHIR MAHESHWARI
Partner

have been included in the Annual Report. Whenever

85

SHAREHOLDER
information
How shareholders can safeguard
their rights and interests.

Registered office:

a) The details of Annual general meetings held in

last three years are as under :

Bangur Nagar, Beawar 305901,

District Ajmer, Rajasthan.

Year ended
30.6.1999

Date of AGM
22.11.1999

Time
4.00P.M

Corporate headquarters :

Dividend payment date

(For the Financial Year April 2002 to March 2003)

Dividend on Redeemable Cumulative Preference Shares

will be made payable on/or after 23rd August, 2002.

Venue
Bangur Nagar,
Beawar 305 901
(Rajasthan)

21, Strand Road, Kolkata 700001.

Financial Calendar

30.6.2000

26.12.2000

4.00P.M.

30.6.2001

24.10.2001

4.00 P.M. -do-

First quarterly un-audited results

By end of July, 02

Second quarterly un-audited results

By end of October, 02

Dividend on Equity Shares when sanctioned will be

Half yearly limited review results

By end of November,02

made payable on/or after 24th August 2002.

Third quarterly un-audited results

By end of January, 03

-do-

Address for correspondence :

Last quarter/yearly un-audited results By end of April, 03

for year ending 31st March 2003

The same will be payable to those Shareholders,

whose names stand on the Companys Register of
Members on Tuesday, the 20th August 2002 (AGM

Shree Cement Limited

b) No special resolution were put through postal

Date of Book Closure

Bangur Nagar

ballot last year .

16th August 2002 to 20th August 2002.

the dividend will be paid on the basis of beneficial

Beawar - 305 901

c) No special resolution are proposed to be put

(both days inclusive).

ownership as per details furnished by the depositories

Distt. Ajmer, Rajasthan.

through postal ballot this year.

Shareholder enquiries :
Shri S.L. Bhansali, Company Secretary
Tele : 01462-28101-06

date). In respect of shares held in electronic form,

for this purpose.

Disclosures
a) There are no materially significant transactions
with related parties viz promoters, Directors or the

Fax : 01462-28117-119

management, their subsidiaries or relatives

e-mail : shreebwr@datainfosys.net

conflicting with companys interest.

bhansalisl@shreecementltd.com

Market Price Data :

b) No penalties or strictures have been imposed on

Clarifications on financial statements :

the company by the stock Exchanges or SEBI or

Shri Ashok Bhandari, Group Financial Advisor.

capital markets during the last three years.

Low

Volume

High

Low

Volume

(Rs.)

(Rs.)

(No. of Shares)

(Rs.)

(Rs.)

(No.of Shares)

July 2001

41.50

25.30

1,00,718

40.50

29.00

2,98,146

August 2001

40.40

35.50

52,729

42.50

36.25

1,95,441

The Annual Report is sent to each shareholder.

September 2001

37.95

34.05

65,560

38.20

22.50

2,68,141

Quarterly and half-yearly results are published in

October 2001

36.70

26.75

67,874

36.70

27.60

3,15,618

the Economic Times, New Delhi, and Rajasthan

November 2001

43.80

35.00

3,03,088

42.90

35.00

7,40,067

Patrika, Jaipur. The results are also provided to

December 2001

60.00

36.75

7,92,016

60.00

37.00

13,68,729

Stock Exchanges where the Companys shares are

January 2002

52.45

43.10

5,32,498

51.95

42.65

12,41,735

listed. The official news releases are given directly

February 2002

47.00

38.10

1,34,279

46.70

39.65

3,84,695

to the media.

March 2002

43.35

38.75

1,02,742

45.40

38.55

5,00,603

Means of communication

e-mail : scl@cal2.vsnl.net.in

Annual General Meeting

Date of AGM

Time

Venue

20.08.2002

4.00 P.M

Registered Office at
Bangur Nagar, Beawar 305 901
Distt Ajmer, Rajasthan.

86

Month

NSE

High

any statutory authority on any matter related to

Tele : 033-220 9601-04 & 220 2608

Fax : 033-243 4226

BSE

Total

21,51,504

53,13,175

87

Opening & closing prices

Depositories (for de-mat only)

BSE
Price
Rs

National Securities Depository Ltd.

NSE
increase
%

Price
Rs

2.7.2001

30.80

32.95

31.3.2002

41.65

41.90

increase
%

Shareholding Pattern

SHREECEM
INE070A01015

Central Depository Services (I) Ltd.

SHREECEM

As on 31 March, 2002
Description

No. of Shares held

2,07,41,974

59.54

4,04,282

1.16

INE070A01015
Promoters

Increase by Rs. 10.85 +35.23%

8.95

+27.16

Registrar and share transfer agents

Mutual fund & UTI

Financial Institutions, Banks, Insurance companies etc.

24,65,248

7.08

600

0.00

NRIs/OCBs/Non-domestic Companies

40,37,368

11.59

Private Corporate Bodies

18,25,721

5.24

Karvy Consultants Ltd.

FIIs

The performance in comparison to broad

Karvy House,21 Road no.4

based indices

Street No 1, Banjara Hills

HYDERABAD-500 034

Indian Public

Indices

BSE(Sensex)

SCLQUOTE

2.7.2001

3406

30.80

31.3.2002

3469

41.65

Increase/Decrease

+1.85%

+35.23%

Total

Contact person:

53,62,032

15.39

3,48,37,225

100.00

Shri V. K Jayaraman, Asstt Gen Manager

Phone No 040-3312454/3320251/3320751
Fax No. 040-3311968/3323049
e-mail: mailmanager@karvy.com

Listing on Stock Exchanges/Depositories

Name of Stock Exchange

Stock Code

Stock Exchange, Mumbai

500387

National Stock Exchange

jayaramanvk@karvy.com

Share Transfer System

SHREECEM EQ

Jaipur Stock Exchange

Calcutta Stock Exchange Asso. Ltd.

N.A.

Delhi Stock Exchange Asso. Ltd.

Ref-4388

Madras Stock Exchange

SHC

Dematerialisation of Shares & Liquidity

Share Transfer requests for transfer in physical

form are registered in about one month.
Shares demat requests received by Share Transfer
Agent M/s Karvy Consultants Ltd, Hyderabad are

The trading in the companys equity shares is

Shareholders holding shares in the demat form are

permitted in Demat form only from 29th

requested to give all instructions regarding the

November 1999. The Company has entered into an

change of address, nomination, power of attorney

agreement with National Securities Depository

and bank mandate directly to their depository

Limited (NSDL) and Central Depository Services

participants.

Limited (CDSL).

registered in about 10 days from the date of

The shares are actively traded at BSE and NSE and

receipt.

In view of the advantage offered by the Depository

have adequate liquidity.

System, members are requested to avail the facility

Distribution of Shareholding
As on 31 March, 2002
Range
From-To

Total no. of
Share holders

Total shares
held

Upto 50

5,314

25.69

2,43,454

0.70

51 - 100

7,244

35.01

7,08,565

2.03

101 - 200

3,242

15.67

5,83,101

1.67

201 - 500

2,958

14.30

11,29,041

3.24

501 - 1000

1,086

5.25

8,97,056

2.58

1001 - 5000

665

3.21

14,42,202

4.14

5001 - 10000

76

0.37

5,42,095

1.56

10001 and above

Total

88

104

0.50

2,92,91,711

84.08

20,689

100.00

3,48,37,225

100.00

of dematerialisation. As on 31 March 2002, 84.04%

There were no outstanding GDRs /ADRs/ Warrants

of the companys share capital had been

or any other Convertible Instruments as on 31st

dematerialised.

March, 2002.

89

AUDITORS
report
To the Members of Shree Cement Limited,
We have audited the attached Balance Sheet of M/s SHREE CEMENT LIMITED as at 31st March, 2002 and the
annexed Profit & Loss Account for the period ended on that date and report that:
1.

unsecured, have been granted to firms or

(i)

The attached Balance Sheet and Profit and Loss

account.

in the case of the Balance Sheet, of the

March, 2002; and

(ii)

& Loss Account dealt with by this report

information and explanations given to us and also

generally comply with the Accounting Standards

on the basis of such checks as were considered

referred to in Section 211(3C) of the Companies

appropriate, we state that:

(i)

The Company is maintaining fixed assets

On the basis of information & explanations given

register giving full particulars including

to us and representation received from the

quantitative details and situation of fixed

Directors of the company, we report that none

assets. The fixed assets were physically

of the Directors of the company is, prima facie,

verified by the management. The

disqualified from being appointed as Directors of

discrepancies noticed were not significant

the company in terms of clause (g) of sub

and have been properly dealt with in the

section (1) of section 274 of the Companies Act,

accounts.

1956.

(ii)

The Company has not revalued its fixed

In our opinion and to the best of our information

assets during the period ended 31st

and according to the explanations given to us,

March' 2002.

the said accounts read together with Significant

Accounting Policies and Notes thereon as stated
in Schedule 19, give the information required by

(iii)

370(1B) of the Companies Act, 1956.

The discrepancies noticed on verification of

(ix)

In respect of loans and advances in the

nature of loans, where stipulations have
been made, parties are generally repaying

which were not significant have been

the principal amounts and interest as

properly dealt with in the books of

stipulated or according to the amendments

account.

thereto.
(vi)

The valuation of stocks is in accordance

with the normally accepted accounting

by the Central Government under Section 227(4A)

of the Companies Act, 1956 and in terms of the

as defined under the erstwhile section

stocks between physical and book records,

March, 2002.

In our opinion, the Balance Sheet and the Profit

Act, 1956 to the extent applicable.

(v)

of the profit for the period ended on 31st

Companies (Auditors' Report) Order, 1988 issued

companies under the same management

nature of its business.

in the case of the Profit and Loss Account,

As required by the Manufacturing and Other

have been informed that there are no

with the size of the Company and the

state of affairs of the Company as at 31st

In our opinion, proper books of account as

other parties listed in the said register. We

Procedures for physical verification of

reasonable and adequate, commensurate

Account are in agreement with the books of

90

of the Company. No loans, secured or

reasonable.

required and give a true and fair view:

examination of these books.

6.

opinion, the frequency of verification was

explanations which, to the best of our

Company, so far as appears from our

5.

prima facie, not prejudicial to the interest

stocks followed by the Company are

required by law have been kept by the

4.

management during the year and in our

the Companies Act, 1956 in the manner so

purpose of our audit.

3.

terms and conditions of such loans are,

We have obtained all the information and

knowledge and belief, were necessary for the

2.

(iv)

with contractors was conducted by the

(x)

In our opinion and according to the

information and explanations given to us

principles and is on the basis consistent

there are adequate internal control

with the previous year.

procedures commensurate with the size

(vii)

The rates of interest and other terms and

and nature of the business with regard to

conditions of loans taken from companies,

purchase of stores, raw materials, plant &

firms or other parties listed in the register

machineries, equipments, other assets and

maintained under section 301 of the

sale of goods.

Companies Act, 1956 are, in our opinion,

not prima facie prejudicial to the interest of
the Company. We have been informed that
there are no companies under the same
management as defined under the
erstwhile section 370 (1B) of the
Companies Act, 1956.

(xi)

According to the information and

explanations given to us, the transactions
of purchase of goods and materials made
in pursuance of contracts or arrangements
entered in the register maintained under
section 301 of the Companies Act, 1956
and aggregating during the year to Rs.

(viii) The Company has granted unsecured loans

50,000/- or more in respect of each party,

to companies listed in the register

have been made at prices which are

maintained under section 301 of the

reasonable, having regard to the prevailing

Physical verification of stocks of finished

Companies Act, 1956. In view of the

market prices for such goods and

goods, stores, spares, and raw material

explanations given to us, we are of the

materials. There are no such transactions

except material in transit and material lying

opinion that the rate of interest and other

for sale of goods, materials, and services.

91

PROFILE
OF
Directors-2002
(xii)

As explained to us, unserviceable or

period of more than six months from the

damaged stores, raw materials, and

date they became payable.

finished goods have been determined and

(xix) Based on the test checks carried out by us

properly accounted for in the books of

and the information and explanations given

account.

to us, no personal expenses have been

(xiii) The Company has not accepted any

charged to the Profit and Loss Account,

deposit from the public during the period.

other than those payable under contractual

obligations or in accordance with generally

(xiv) The Company, in our opinion, is

and disposal of realisable scrap. There is

(xx) The Company is not a sick industrial

Director, is an M.Com from Delhi University. Was

from Calcutta University. Mr. Bangur brings with him

previously posted as Managing Director of State Bank

long experience in industry. He is also the director of

of India and State Bank of Bikaner & Jaipur. Mr. Setia

The Didwana Industrial Corporation Ltd., Marwar

has been appointed as nominee director on Board of

Textile Agency Ltd., NBI Industrial Finance Co. Ltd.,

Rayalseema Paper Mills Co. Ltd. by BIFR recently.

Shree Capital Services Ltd., Ragini Finance Ltd., Didu

Finance Ltd.

Company within the meaning of clause (o)

of sub-Section (1) of Section 3 of the Sick

(xv) The Company has an internal audit system

Shri S.K. Somany

Jt. Managing Director, is a chemical engineer from

Refractories Ltd., Soma Textile & Ind. Ltd., Indian

IIT, Mumbai. He brings to the Board a technical

Council of Ceramic Tiles & Sanitaryware, Shree

insight which is the driving force of the technical

Hanuman Investments Pvt. Ltd., Pressed Steel Tank

transactions and contracts in respect of

excellence achieved by the Company. Mr. Bangur is

Co. of India Ltd., Sunshine Travels (I) Pvt. Ltd.,

trading in shares, debentures and other

also a Director in India Textile Agency Ltd.,

Brindavan Commercial Ltd., Bestometa Industries

securities and entries therein have

Mannakrishna Investments Ltd., The Venktesh Co.

Ltd., Chakrapani Promotions Ltd., Charchika Impex

generally been made in time. All shares,

Ltd., Shree Capital Services Ltd., Marwar Textile

Ltd., Gemini Constructions Ltd., Sarvottam Vanijya

debentures and other securities have been

Agency Ltd., Videocon Leasing & Industrial Finance

Ltd., Sarvopari Investments Pvt. Ltd., Dhandhapani

held by the Company in its own name,

Ltd., The Kamla Co. Ltd., Digvijay Finlease Ltd. and

Co. Ltd., Teamwork Holdings Pvt. Ltd., Kechak Credit

except for certain securities which are

Khemka Properties Pvt. Ltd.

& Finvest Pvt. Ltd. and Cosmos Ferrites Ltd.

(xxi) The Company has maintained records of

and records maintained by the Company

pursuant to the rule made by the Central
Government for the maintenance of cost
records under Section 209(1)(d) of the
Companies Act, 1956 and are of the
opinion that prima facie, the prescribed
accounts and records have been made and

Science degree from Calcutta University and is

currently on the Board of SPL Ltd., Special

Act, 1985.

its business.

Director, is an industrialist. Holds a Bachelor of

Shri H.M. Bangur

Industrial Companies (Special Provisions)

commensurate with the size and nature of

either lodged for transfer or held with valid

maintained.

Shri R.L. Gaggar

transfer forms.

Shri R.S. Agarwal

(xvii) According to the records of the Company,

Director, completed his B.A. (Hons) from Calcutta

provident fund dues have been regularly

University and is a renowned solicitor and advocate

deposited with the appropriate authority.

based in Kolkata. Mr. Gaggar is also on the board of

We have been informed that the provisions

Director, is a Senior Fellow Chartered Accountant,

Company Secretary and a Law Graduate and driving

Hindustan National Glass & Industries Ltd., Somany

force behind Emami Group. Presently he is on the

Pilkingtons Ltd., Sarda Plywood Industries Ltd.,

Board of Emami Limited, Emami Paper Mills Ltd.,

Financial & Management Services Ltd., Premier

South City Project (Kolkata) Limited, Advance

(Eastern) Inc. Pvt. Ltd., TIL Ltd., Peria Karamalai Tea

Medicare & Research Institute Ltd., Emami Group of

explanations given to us, there are no

& Produce Co. Ltd., Paharpur Cooling Towers Ltd.,

Companies Pvt. Ltd., Diwakar Viniyog Pvt. Ltd.,

undisputed amounts payable in respect of

International Combustion India Ltd., Subhash Projects

Suntrack Commerce Pvt. Ltd.. He is also associated

& Marketing Ltd., IFB Agro Industries Ltd., Machino

as a director, with Merchants Chamber of Commerce

Plymers Ltd., Sumedha Fiscal Services Ltd. and

and Associated Chamber of Commerce & Industry of

Stone (India) Ltd.

India.

of Employees' State Insurance Act are not

applicable to the Company.

For B.R.MAHESWARI & CO.,

(xviii) According to the information and

Chartered Accountants

Income-tax, Wealth-tax, Sales-tax,

92

Chairman & Managing Director, is a B.Com (Hons.)

Western India Commercial Co. Ltd. and Mansi

no by-product.

(xvi) We have broadly reviewed the accounts

Shri O.P. Setia

Investments Ltd., Kehmka Properties Pvt. Ltd.,

accepted business practice.

maintaining reasonable records for sale

Shri B.G. Bangur

Customs Duty and Excise Duty which are

KOLKATA

outstanding as on 31st March, 2002 for a

26th April, 2002

SUDHIR MAHESHWARI
Partner

93

Shri Agnivesh Agarwal

Director, completed his Bachelor's Degree in
Commerce in 1996. Since 1996, Shri Agarwal is
engaged in international trade and commerce with a

for Building Materials ( NCBM) and is the President of

Rajasthan Cement Manufacturers Association and on
the Board of Shree Cement Marketing Limited.

Shri B.R. Gupta

special emphasis on commodity trading especially in

non-ferrous metals. Shri Agarwal has also acquired

Director, is a nominee appointed by IDBI and has

considerable expertise in hardware and software

been on the Board of the Company since 29.12.2000.

development business with a special emphasis on

He is a consultant and possesses M.A., L.L.B. and

e-commerce. Shri Agarwal is on the Board of Bharat

F.I.I.I. degree. Presently he is on the Board of Indian

Aluminium Co. Ltd. (BALCO), India Foils Ltd., Madras

Rayon & Industries Ltd., Mahindra & Mahindra

Aluminium Co. Ltd. and Agarwal Galvanizing Pvt. Ltd.

Limited, Greaves Limited, Prudential ICICI Assets

Mgmt. Co. Ltd., Tolani Bulk Carrier Limited, Bank of

Shri M.K. Singhi

Executive Director, a Chartered Accountant is also a
Science and Law Graduate. Joined the Company as

Rajasthan Limited ,IDBI Capital Market Services

Limited and Sentient Advisors Private Limited.

Shri Harkirat Singh

President in January,1995. He has 24 years of

94

experience of working at senior positions including

Director, is a nominee appointed by the LIC. He holds

over 2 decades in cement industry. Shri Singhi was

a Master's degree in Economics and is a director of

member of Board of Governors of National Council

Swaraj Mazda Limited.

FINANCIAL
Section

95
97

PROFIT & LOSS ACCOUNT FOR THE PERIOD ENDED 31ST MARCH, 2002

BALANCE SHEET AS AT 31ST MARCH, 2002

Schedule

2001-02
[Rs. in Lacs]

Schedule

SOURCES OF FUNDS
1) Shareholders Funds
a) Capital
b) Reserves & Surplus

1
2

2) Loan Funds
a) Secured Loans
b) Unsecured Loans

3
4

APPLICATION OF FUNDS
1) Fixed Assets
a) Gross Block
b) Less: Depreciation
c) Net Block
d) Capital Work-in-Progress
e) Survey, Prospecting & Mining Development Expenses
(to the extent not written off)

4,983.72
31,003.93
35,987.65

4,983.72
36,252.61
41,236.33

27,261.60
2,226.32
29,487.92
65,475.57

30,647.75
1,234.39
31,882.14
73,118.47

84,458.63
24,992.84
59,465.79
3,029.19

77,363.31
20,714.14
56,649.17
5,907.34

2) Investments
3) Current Assets, Loans & Advances
a) Inventories
b) Sundry Debtors
c) Cash & Bank Balances
d) Loans & Advances

6
7
8
9
10

Less: Current Liabilities & Provisions

a) Current Liabilities
b) Provisions

227.56
62,722.54
125.04

260.07
62,816.58
359.73

4,103.14
3,003.39
553.38
6,422.78
14,082.69

3,471.75
4,081.88
1,891.48
6,583.55
16,028.66

5,839.95
446.13
6,286.08
7,796.61

5,487.57
598.93
6,086.50
9,942.16

(5,168.62)
65,475.57

73,118.47

11

Net Current Assets

4) Deferred Taxation

12

Accounting Policies & Notes on Accounts

19

As per our report of even date

For B. R. Maheswari & Co.
Chartered Accounts

2000-01
[Rs. in Lacs]

INCOME
Sales
Other Income
Increase / (Decrease) in Stock
EXPENDITURE
Manufacturing Expenses
Excise Duty
Payment to and Provisions for Employees
Administrative Expenses
Freight,Handling & Selling Expenses
Interest (Net)
Preliminary Expenses written off
Survey, Prospecting & Mining Development
Expenses written off

21,094.31
8,775.88
1,659.33
1,102.98
11,904.17
4,400.53
0.07
43.35

35,370.13

48,980.62

4,984.09

4,312.56
671.53
310.41
214.37
146.75
320.10
1,943.39
2,410.24

1,010.00

5,176.33
2,808.02
5,372.85
2,611.50

2,611.50
57.66

2,669.16
1,087.73
666.67

92.81

348.37

1,451.18
959.06
2,410.24
17.89
1.03

191.25
19.51
348.37
35.53
2,349.06
320.10
2,669.16
14.86
6.89

15
16
17
18

19
Signature to Schedule 1 to 19

H. M. Bangur
Jt. Managing Director

S. K. Somany
Director

B. G. Bangur
Chairman & Managing Director

H. M. Bangur
Jt. Managing Director

B. R. Gupta
Director

Kolkata
26th April, 2002
96

15,193.37
6,370.62
1,353.69
1,204.05
8,523.02
2,692.87

32.51

14

Annualized E.P.S. - Cash

- Basic
Accounting Policies & Notes on Accounts

B. G. Bangur
Chairman & Managing Director

R. S. Agarwal
Director

55,460.48
28.35
(1,331.88)
54,156.95

PROFIT BEFORE DEPRECIATION & TAXATION

Add: Transfer from Revaluation Reserve
Less: Depreciation
PROFIT BEFORE TAXATION
Less : Provision for Taxation
Less : Provision for Deferred Tax
PROFIT AFTER TAX
Add : Balance brought forward from Previous Year
Add : Debenture Redemption Reserve No Longer Required
PROFIT AVAILABLE FOR APPROPRIATION
Transferred to Debenture Redemption Reserve
Transferred to General Reserve
Proposed Dividend
On Preference Shares
Corporate Dividend Tax on above
On Equity Shares
Corporate Dividend Tax on above

As per our report of even date

For B. R. Maheswari & Co.
Chartered Accounts

S. L. Bhansali
Secretary

39,721.69
30.87
601.66
40,354.22

13

Sudhir Maheshwari
Partner

Kolkata
26th April, 2002

For the period

ended
30.6.2001
[Rs. in Lacs]

Balance carried over to Balance Sheet

Signature to Schedule 1 to 19

Sudhir Maheshwari
Partner

For the period

ended
31.3.2002
[Rs. in Lacs]

S. L. Bhansali
Secretary

R. S. Agarwal
Director

S. K. Somany
Director

B. R. Gupta
Director
97

Schedules forming part of the Accounts as at 31st March, 2002

2001-02
[Rs.in Lacs]

Issued
3,48,37,225 Equity Shares of Rs.10/- each
7,50,000 9% Cumulative Redeemable Preference Shares of Rs.100/-each
7,50,000 7.5% Cumulative Redeemable Preference Shares of Rs.100/-each

6,000.00

6,000.00

1,500.00

1,500.00

7,500.00

7,500.00

3,483.72
750.00
750.00
4,983.72

3,483.72
750.00
750.00
4,983.72

3,483.72

3,483.72

Subscribed and Paid-up

3,48,37,225 Equity Shares of Rs.10/- each fully paid-up
(Previous Year 348,37,225 Equity Shares)

2000-01
[Rs. In Lacs]

Capital Reserve
As per last Balance Sheet

27.16

27.16

Share Premium Account

As per last Balance Sheet

3,044.80

3,044.80

3,830.20

1,943.39
1,886.81

4,275.80
1,087.73
1,533.33

3,830.20

16,530.35

2,103.29
14,427.06

19,370.43
0.49
32.55
2,808.02

16,530.35

12,500.00

1,010.00
4,954.25
8,555.75

10,300.00
1,533.33
666.67

12,500.00

2,103.29
2,103.29

959.06
31,003.93

320.10
36,252.61

20,297.91

23,347.73

333.33

571.43

857.14

250.00

500.00

733.34

916.67

332.04

394.14

2,402.36
2,674.52
27,261.60

1263.82
3,034.92
30,647.75

SCHEDULE 2
RESERVES AND SURPLUS

SCHEDULE 1
SHARE CAPITAL
Authorised
6,00,00,000 Equity Shares of Rs.10/- each
(Previous Year 600,00,000 Equity Shares of Rs.10/-each)
15,00,000 Cumulative Preference Shares of Rs.100/- each
(Previous Year 15,00,000 Cumulative Preference Shares of Rs.100/-each)

2001-02
[Rs.in Lacs]

2000-01
[Rs. In Lacs]

[Issued subscribed & paid-up capital includes (a) 2,40,021 Equity Shares

Debenture Redemption Reserve

As per last Balance Sheet
Addition during the year
Less : Transfer to General Reserve
Less : Transfer to Profit & Loss Account
Revaluation Reserve
As per last Balance Sheet
Add : Addition during the year (Net)
Less : Adjustment/ Sale of Fixed Assets
: Transfer to Profit & Loss Account
: Transfer to Special Reserve
General Reserve
As per last Balance Sheet
Add : Transfer from Debenture Redemption Reserve
Add : Transfer from Profit & Loss Account
Less : Deferred Tax Liability

of Rs.10/- each fully paid-up issued for consideration other than cash in
pursuance of Scheme of Amalgamation (b) 20,480 Forfeited Equity
Shares and (c) 43,95,000 Equity Shares issued on surrender of
detachable optional Share warrants attached with 16% Unsecured Non
Convertible Redeemable Debentures of Rs.100/- each, vide Board

Special Reserve
Transfer from Revaluation Reserve

Resolution dated 5.5.95]

7,50,000 9% Cumulative Redeemable Preference Shares of Rs. 100/- each

750.00

750.00
Surplus as per annexed Profit & Loss Account

[Redeemable at a premium of Rs. 71/- per share after seven years on

30.6.2006 with a call option for early redemption of one-third of the
total preference share capital subscribed at the end of third and fifth
year at such premium which gives the holder, a yield to maturity of

SCHEDULE 3
SECURED LOANS

15% p.a.]

Term Loans from Financial Institutions

Secured Redeemable Non Convertible Debentures

7,50,000 7.5% Cumulative Redeemable Preference Shares of Rs. 100/- each

750.00

750.00

[Redeemable at a premium of Rs. 5/- per share after seven years on

2.7.2007 with a call option for early redemption of one-third of the total

6,00,000 16% NCDs of Rs. 100/- each &

4,00,000 13.5% NCDs of Rs. 100/- each
[Redeemed Rs. 1000 Lac (Previous Year 666.67)]

preference share capital subscribed at the end of third and fifth year at

20,00,000 14.5% NCDs of Rs. 100/- each

such premium which gives the holder, a yield to maturity of

[Redeemed Rs. 1428.57 Lac (Previous Year Rs.1142.86 Lac)]

11.50% p.a.]

10,00,000 14.5% NCDs of Rs. 100/- each

4,983.72

4,983.72

[Redeemed Rs. 750.00 Lac (Previous Year Rs.500.00 Lac)]

11,00,000 14% NCDs of Rs.100/- each

[Redeemed Rs. 366.66 Lac (Previous Year Rs. 183.33 Lac)]

2,70,000 13.5% NCDs of Rs. 100/- each &

1,37,000 13.5% NCDs of Rs. 100/- each
[Redeemed Rs. 74.96 Lac (Previous Year Rs. 12.86 Lac)]

Working Capital Loan from Banks

Cash Credit
Demand Loan

98

99

(a) Buildings, most of Plant & Machinery and Railway siding have been revalued on 31.12.1999 on indexed capitalised cost (RBI Index) basis resulting in increase in gross
value by Rs. 436.48 lac, Rs. 21063.92 lac and Rs. 679.12 lac respectively as per report of approved valuers.
(b) Lease hold land and assets on lease have been revalued by an approved valuer applying indexed capitalised cost (RBI Index) and physical existence basis respectively.
The revaluation process has resulted into a net increase of Rs. 0.49 Lac.
(c) Includes Rs. 2103.29 Lac for current year (upto previous year Rs. 5617.11 lac) being additional depreciation on revalued assets withdrawn from Revaluation Reserve.
(d) Includes interest during construction of Rs. 221.40 Lacs (Previous Year Rs. 913.07 Lac).
(e) Expense Written off.

61067.63

62816.58
62722.54

62816.58
20936.56

25247.77
33.86

814.47
5416.20

4345.07
20936.56

16334.83
83753.14

87970.31
7014.13

7583.53
Previous Year

11231.30
83753.14

77402.46

Grand Total (A+B)

13934.21

4769.29
6167.41
222.42

43.35
179.07
6389.83
5628.42
4948.36
Previous Year

7069.89

6167.41
3256.75
254.93

32.51
222.42
3511.68
6929.25
4051.10
6389.83
Total (B)

260.07
227.56
254.93 (e)

32.51
222.42
482.49

482.49
Survey Prospecting & Mining

Development Expenses

5907.34

56298.34
56649.17

3029.19

20714.14
814.47

5372.85
16155.76

3029.19
6929.25
4051.10 (d)

77363.31
1955.11
6864.32

5907.34

72454.10
Previous Year

Capital Work In Progress

56649.17

59465.79
24992.84

33.86
4312.56

20714.14
84458.63

84.88
7180.20

77363.31

Total (2)

Total (A) (1+2)

Office Equipments

Plant & Machinery

Assets On Lease

211.60

56649.17
59465.79

287.49
205.98

24992.84
33.86

31.83
27.24

4312.56 (c)
20714.14

210.57
493.47

84458.63
Total (1)

84.88

141.19

7180.20

422.17

77363.31 (a)

Vehicles

69.89

350.59
372.53
503.53
2.03
44.85
460.71
876.06
4.99
69.75
811.30

19105.83

571.49
1712.10

76201.51

6919.54

1712.10 (a)

365.54
3504.32

69281.97 (a)

49.71
3454.61 (a)

1032.99

467.84

0.01

467.84

Furniture, Fixtures &

Office Equipments

1140.61

50176.14
53001.60

1051.76
660.34

88.85 (c)

23199.91

3089.07
3081.24
423.08

4094.08 (c)

57.54 (c)

467.84

1032.98
1032.99

467.84

180.34
170.34

170.34
10.00

Period
Period

As at

2001
2002
31st March,
during the

2002
Period

during the
2001
during the
during the
2001

2002

Upto

Total
Deductions/

Adjustments
Adjusted

Provided/
Upto
Total as at
Deductions/
Additions/
As at

Period

Railway Siding

30.00
1,234.39

Plant & Machinery

2,226.32

Buildings

Short Term Loan

1032.98 (b)

1,204.39

Land & Site Development

2,226.32

Leasehold Land

Deferred Sales Tax

180.34

[Rs. In Lacs]

Freehold Land

[Rs.in Lacs]
UNSECURED LOANS

FIXED ASSETS

2000-01

2001-02

SCHEDULE 5

SCHEDULE 4

GROSS BLOCK

3) Working Capital borrowings from Banks are secured by hypothecation of inventories of stock-in-trade, stores & spares, book
debts and other current assets of the Company on first charge basis and on whole of movable fixed assets of the Company on
second charge basis. These borrowings are also secured by joint equitable mortgage on all the immovable assets of the Company
on second charge basis.

30th June,

are secured by joint equitable mortgage over all the immovable assets and first charge by way of hypothecation of all the
movable assets (save and except book debts) of the Company, both present and future, subject to prior charge(s) created
and/or to be created in favour of the Company's bankers on inventories of stock-in-trade, stores & spares, book debts and
other current assets of the Company for working capital facilities. The mortgage and charge rank pari passu with the
mortgage and charges created / to be created in favour of other first charge holders for their respective loans. The said
debentures are also secured by a legal mortgage over one of the immovable properties of the Company situated in Mumbai,
by execution of Debenture Trust Deed.

31st March,

(v) 1,10,000 13.5% Non Convertible Debentures of Rs.100/- each aggregating to Rs. 110 Lac (Previous Year Rs. 110 Lac
@ 17.5%) redeemable at par in twenty one equal quarterly instalments commencing from 1st July, 2001 and 27,000 13.5%
Non Convertible Debentures of Rs.100/- each aggregating to Rs.27 Lac (Previous Year Rs. 27 Lac @ 17.5%) redeemable at
par in twenty one equal quarterly instalments commencing from 1st January, 2002

Adjustments

(iv) 2,70,000 13.5% Non Convertible Debentures of Rs. 100/- each aggregating to Rs.270 Lac (Previous Year Rs. 270 Lac
@ 17.5%) redeemable at par in twenty one equal quarterly instalments commencing from 1st July, 2001

Adjustments

DEPRECIATION

(iii) 11,00,000 14% Non Convertible Debentures of Rs.100/- each aggregating to Rs. 1100 Lac (Previous Year Rs.1100 Lac )
redeemable at par in six equal bi-annual instalments commencing from 2nd June, 2001,

30th June,

(ii) 10,00,000 14.5% Non Convertible Debentures of Rs.100/- each aggregating to Rs.1000 Lac (Previous Year Rs. 1000 Lac )
redeemable at par in four equal annual instalments commencing from 1st April, 2000

100

As at

NET BLOCK

20,00,000 14.5% Non Convertible Debentures of Rs.100/- each aggregating to Rs. 2000 Lac (Previous Year Rs. 2000 Lac )
redeemable at par in seven equal annual instalments commencing from 1st October, 1997

Particulars

2) (i)

31st March,

1) All Term Loans [except Interest Free Sales-tax Loan of Rs. 809.42 Lac (Previous Year Rs. 809.42 Lac) from RIICO which is secured
by joint equitable mortgage on second charge basis ranking pari passu with the Commercial Banks for Working Capital facilities]
from Financial Institutions are secured by joint equitable mortgage on all the immovable assets ranking pari passu with the
Debenture holders for Redeemable Non Convertible Debentures privately placed with financial institutions as mentioned in point
(2) herebelow. The above term loans and NCDs are also secured by hypothecation of all the movable assets (save & except book
debts) of the Company both present and future subject to charge(s) created and/or to be created in favour of the Company's
bankers on inventories of stock-in-trade, stores & spares, book debts and other current assets of the Company for working capital
facilities. The above charge(s) rank pari passu inter-se among these lenders.

30th June,

SCHEDULE 3
SECURED LOANS (Contd.)

101

SCHEDULE-6
INVESTMENTS
(Rs. in Lac)
As at 30th June, 2001
Particulars
Value Face
(Per Unit)
In Government & Trust Securities:
Unquoted
National Saving Certificate

No.

Amount

Additions during
the period
No.

Sold/Deductions
during the period

Amount

No.

As at 31st
March, 2002

Amount

No.

Amount

0.03

0.03

1000

10000

80.00

10000

80.00

(Deposited with Govt. Dept. as Security)

Bonds
9% Tax Free Bonds of Power
Grid Corpn. of India Ltd.

SCHEDULE 8
SUNDRY DEBTORS
(UNSECURED)
Over Six months (Considered good)
(Considered doubtful)

(Pending registration in the name

of the Company).

In Fully Paid-up Shares, Units

and Bonds:
Other than Trade:
Quoted:
Shares
IDBI

SCHEDULE 7
INVENTORIES
(As taken, valued and certified by the Management)
Raw Materials (At Cost)
Stores, Spares, Coal & Packing Materials (At Cost)
Materials-in-Transit (At Cost)
Goods-in-Process (At Cost)
Finished Goods (At lower of cost or net realisable value)

Less: Provisions
10

64960

50.31

39.65

64960

10.66

Others (Considered good)

Unquoted:
Shares
Subsidiary Company
Shree Cement Marketing Ltd.
Equity Shares
Others
Equity Shares
Benz Files Export Pvt. Ltd.
Oosypine Mar-Pack Pvt. Ltd.
Units
Cholamandlam Cazenove
Mutual Fund

10

100
10

14500
147500

14.57
14.82

10

1530222

49930

4.99

49930

4.99

14500
147500

14.57
14.82

200.00

1530222

200.00

359.73

4.99

239.68

Book Value

125.04

Market Value

31.3.2002

30.6.2001

31.3.2002

30.6.2001

(Rs. in Lac)

(Rs. in Lac)

(Rs. in Lac)

(Rs. in Lac)

10.66

50.31

10.66

16.21

114.38

309.42

114.38

309.42

125.04

359.73

125.04

325.63

Aggregate Amount of:

Quoted Investment
Unquoted Investment (at cost)
(Bonds & Shares)

102

SCHEDULE 9
CASH AND BANK BALANCES
Cash Balances
Remittances in transit
Balance with Scheduled Banks :
In Fixed Deposit Accounts
In Current Accounts
In Margin Money Accounts
Fixed Deposits (Pledged with Banks)
In Unpaid Dividend Account

SCHEDULE 10
LOANS AND ADVANCES
(Unsecured - Considered Good)
Advances Recoverable in cash or in kind or for value to be received
Short Term Deposit with Mutual Fund
Deposit with Government Departments & Others
Inter Corporate Deposits
Subsidiary Company
Others
Prepaid Expenses
Interest on deposits recoverable
Tax deducted at source, net of provision.

2001-02
[Rs.in Lacs]

2000-01
[Rs. In Lacs]

406.92
2,240.75
161.55
732.27
561.65
4,103.14

358.56
2,329.19
91.74
118.86
573.40
3,471.75

1,284.14

1,284.14

1,284.14
1,719.25
3,003.39

1,364.97
19.59
1,384.56
19.59
1,364.97
2,716.91
4,081.88

27.18
157.00

15.90
484.26

1.39
270.64

1.28
1,274.25

88.54
8.63
553.38

111.93
3.86
1,891.48

2,061.57
2,363.40
1,004.22

2,027.56
2,593.40
831.66

780.35
56.09
129.43
27.72
6,422.78

800.00
77.60
175.10
78.23
6,583.55

103

2001-02
[Rs.in Lacs]
SCHEDULE 11
CURRENT LIABILITIES AND PROVISIONS
Current Liabilities
Sundry Creditors [SSI Creditors Rs. 14.28 Lac (Previous Year 4.96 Lac )]
Security Deposits & Advances
Other Liabilities
Sales-tax Payable
Interest accrued but not due on loans
Unpaid Dividend
Provisions
Provision for Wealth-tax
Proposed Dividends
Provision for Corporate Dividend Tax

SCHEDULE 12
DEFERRED TAXATION
Difference between Book and tax Depreciation
Carried forward losses
Others

SCHEDULE 13
INCREASE / (DECREASE) IN STOCK
Opening Stock
Goods-in-Process
Finished Goods
Closing Stock
Goods-in-Process
Finished Goods
Increase/(Decrease)

SCHEDULE 14
MANUFACTURING EXPENSES
Raw Materials Consumed
Stores, Spares & Packing Materials Consumed
Power, Fuel & Water
Repair & Maintenance:
(a) Plant & Machineries
(b) Buildings
(c) Others

104

2001-02
[Rs.in Lacs]

2000-01
[Rs. In Lacs]

3,754.05
1,883.59
46.76
86.61
60.31
8.63
5,839.95

3,405.98
1,513.73
24.59
362.28
177.13
3.86
5,487.57

4.95
441.18

6,286.08

4.27
539.62
55.04
6,086.50

8,465.87
(3,266.97)
(30.28)
5,168.62

118.86
573.40
692.26

1,315.85
708.29
2,024.14

732.27
561.65
1,293.92
601.66

118.86
573.40
692.26
(1,331.88)

3,826.38
1,982.39
9,021.79

5,014.28
2,635.55
13,082.93

292.47
54.91
15.43
15,193.37

271.53
70.54
19.48
21,094.31

SCHEDULE 15
PAYMENT TO AND PROVISIONS FOR EMPLOYEES
Salaries,Wages,Bonus and Allowances
Contribution to Provident Fund, Superannuation Fund and Gratuity
Employees Welfare Expenses

SCHEDULE 16
ADMINISTRATIVE EXPENSES
Rent (Net)
Rates & Taxes
Insurance
Travelling [Including Rs. 7.82 Lac for Directors (Previous Year Rs. 5.32 Lac)]
Directors Fees
Miscellaneous
Debit/ (Credit) Balance Written Off/Back (Net)
Doubtful debts written off
Fixed Assets Written off
(Profit) / Loss on Sale of Fixed Assets (Net)
Bank and Financial Charges

2000-01
[Rs. in Lacs]

1,054.92
138.11
160.66

1,317.63
152.95
188.75

1,353.69

1,659.33

43.08
71.17
78.73
237.85
0.55
442.21
(27.50)
155.46

17.14
197.04

53.76
71.10
97.89
241.48
0.43
448.83
258.21

0.06
(19.16)
227.22

(11.68)

(276.84)

1,204.05

1,102.98

5,901.09
414.72
2,207.21

8,510.72
665.91
2,727.54

8,523.02

11,904.17

2,510.99
219.57
293.90
86.05
157.65
3,268.16
575.29

2,775.56
482.81
1,154.06
83.62
223.05
4,719.10
318.57

2,692.87

4,400.53

(Including foreign exchange fluctuation of Rs. 113.58 Lac) (Previous Year Rs. 95.91 Lac)

Adjustments Related to Earlier Years (Net)

SCHEDULE 17
FREIGHT, HANDLING & SELLING EXPENSES
Freight & Handling
Advertisement and Sales Promotion
Rebate & Discount and Depot Handling

SCHEDULE 18
INTEREST
(a) On Term Loans
(b) On Cash Credits
(c) On Non Convertible Debentures
(d) On Stockists' Deposit
(e) On Others
Less: Interest Received (Net)
[Includes Rs. 6.75 Lac on Tax Free Bonds (Previous Year Rs. 9.00 Lac)]
[Tax deducted at source Rs. 18.88 Lac (Previous Year Rs. 43.61 Lac)]

105

SCHEDULE - 19

ACCOUNTING POLICIES AND NOTES ON ACCOUNTS

[A] SIGNIFICANT ACCOUNTING POLICIES

[B] NOTES ON ACCOUNTS

1.

Accounting Convention
The Accounts of the Company are prepared under the historical cost convention using the accrual method of accounting
unless stated otherwise hereinafter. Accounting Policies not specifically referred to, are consistent with generally
accepted accounting principles.

1.

Contingent liabilities not provided for:

(a) Counter-guarantees for Rs. 8035.45 Lac in favour of banks (Previous Year Rs.1076.43 Lac).
(b) Interest on Late Payment of Royalty amounting to Rs. 122.54 Lac (Previous Year Rs. 122.54 Lac).
(c) Modvat credit on HSD oil used for generation of power for Rs. 275.72 Lac. (Previous Year Rs. 275.72 Lac)

2.

Fixed Assets
Fixed Assets other than those, which have been revalued, are stated at cost including expenses related to acquisition
and installation thereof, less accumulated depreciation and amortised amount, except for land.

2.

Instalments of Secured loans falling due for repayment in next 12 months amount to Rs. 3600.11 Lac.

3.

Estimated amount of contracts remaining to be executed on capital account Rs. 7809.85 Lac (Net of advances) (Previous
Year Rs. 105.28 Lac)

4.

Purchase value of land, in some cases, is subject to finalisation of acquisition proceedings. Additional liability, if any,
is not ascertainable at present.

5.

The Ministry of Textiles, vide its orders dated 30th June, 1997 and 1st July, 1999 has deleted cement from the list of
commodities to be packed in Jute bags under the Jute Packaging (Compulsory Use in Packing Commodities) Act 1987.
In view of this, the company does not expect any liability for non-dispatch of cement in Jute bags in respect of earlier
years.

6.

Debit and Credit balances of parties are subject to confirmation.

7.

In the opinion of the Management and to the best of their knowledge and belief the value on realization of Loans,
Advances and Other Current Assets in the ordinary course of business will not be less than the amount at which they
are stated in the Balance Sheet.

8.

Fixed assets include Rs.137.23 Lac (Previous Year Rs. 211.23 Lac) paid towards cost of land and building in respect of
which conveyance deeds are pending execution in favour of the Company.

9.

Advances recoverable in cash or in kind include Rs. Nil (Previous Year Rs. Nil) due from officers of the Company.
Maximum amount due at any time during the period Rs. Nil (Previous Year Rs. 11.55 Lac).

3.

Capital Work in Progress

Capital work in progress is carried at cost comprising direct cost, advance, building material stock and incidental
expenditure during construction period to be allocated to the fixed assets on the completion of the construction.

4.

Investments
Investments are stated at cost of acquisition or market price whichever is lower.

5.

Inventories
Raw Materials, Stores & Spare Parts and Semi-finished Goods are valued at Weighted average cost. Finished Goods are
valued at lower of cost or net realisable value, inclusive of Excise Duty.

6.

7.

Depreciation
Depreciation is provided on the Straight Line Method at the rates and in the manner specified in schedule XIV of the
Companies Act, 1956 as amended. Depreciation on additions due to exchange rate fluctuation is charged prospectively
over the residual life of the Assets. Depreciation on the addition to the certain fixed assets pursuant to revaluation has
been provided on the basis of the remaining life of the said assets as determined by the valuers.
Taxation
Provision for tax is made for current and deferred taxes. Provision for current income tax is made on the current tax
rates based on assessable income. The deferred tax is recognized, based on timing differences, being the difference
between taxable income and accounting income that originate in one period and are capable of reversal in one or more
subsequent periods.

8.

Revenue Recognition
(a) Sale is recognized on despatch of goods from Plant/Stock point to customer.
(b) Scrap sale is accounted on cash basis.
(c) Insurance Claims are accounted on actual receipt.
(d) Additional claim for Rebate & Discount from Dealers/Sale Promoters, are accounted for as and when settled.

9.

Foreign Exchange Transactions

Foreign currency transactions are accounted at equivalent rupee value earned/incurred. Year-end balance in Current
Asset/ Liabilities is accounted at applicable rates.

10. Research & Development Expenditure

Revenue expenditure is charged to Profit & Loss Account under natural head of expenditure. Capital expenditure is
capitalised.
11. Retirement Benefit
The Company makes regular contribution to approved/recognized Provident, Superannuation & Pension Funds and
contribution so made is charged to Profit & Loss Account. The contribution for Gratuity is being made to the approved
Gratuity Fund by way of premium, under the Cash Accumulation Policy of the Life Insurance Corporation of India.
Earned leave is accounted for on the basis of actuarial valuation.

10. Sales Include

Captive Consumption of Cement
Excise Duty
Rebate and discount

2001-2002
[Rs. In Lac]
53.00
6307.55
1820.90

2000-2001
[Rs. In Lac]
3.09
8400.94
2105.08

11. Other Income includes (a) Dividend Rs. 2.92 Lac (Previous year Rs. Nil) (b) Profit/(Loss) on sale of Investments (net)
Rs. Nil (Previous year Rs. 1.07 Lac), and (c) Miscellaneous Receipts Rs. 27.95 Lac (Previous year Rs. 27.28 Lac).
12. The profit for the period is lower due to(a) Charging of depreciation on revalued assets by Rs. 2103.29 Lac, and
(b) Valuing the investment at lower of cost or market value by Rs. 466.32 Lac.
13. During the period, the Company has implemented Accounting Standard- 22, 'Accounting for Taxes on Income' issued
by the Institute of Chartered Accountants of India. The net deferred tax liability provided during the year pertaining to
the period up to 30th June, 2001, amounting to Rs. 4954.25 Lac has been adjusted against the General Reserve and the
deferred tax credit of Rs. 214.37 Lac for the period has been charged to the Profit & Loss Account.
14. There are no transactions with related parties as envisaged by Accounting Standard-18, 'Related Party Disclosure' issued
by the Institute of Chartered Accountants of India.

12. Borrowing Cost

Interest and other cost are charged to Profit & Loss account except those, which are attributed to the capital work in
progress.
13. Contingent Liabilities
Contingent liabilities are not provided and are disclosed in Notes on Accounts.
106

107

15. Payment made to Auditors during the period is as under:

(b) Sales and Stocks (Cement)

2001-2002
[Rs. In Lac]

2000-2001
[Rs. In Lac]

Audit Fee

2.25

3.00

(i) Opening Stock

Tax Audit Fee

0.75

0.75
0.75

(iii) Closing Stock

Consultancy

1.89 (*)
1.37 (*)

(ii) Sales

Certification / Other Services

3.00

Reimbursement of Expenses

1.84

1.26

2001-2002

Statutory Auditors

2000-2001

Quantity

Value

[MT]
36482
1802156

Quantity

Value

[Rs. in Lac]

[MT]

[Rs. in Lac]

573.40

53386

708.29

39721.69 (*)

40684

561.65

2400270

55460.48 (*)

36482

573.40

(*) Includes Rs. 380.46 Lac (Previous Year Rs. 2449.01 Lac) being value of clinker sold.

(Includes service tax)

(*) (Includes Rs. 1.75 Lac of Previous Year)

(c) Raw materials consumed: (All Indigenous).

Cost Auditors

2001-2002

Audit Fee

0.56

0.75

Reimbursement of Expenses

0.22

0.24

(Includes service tax)

Value

Quantity

Value

[MT]

[Rs. in Lac]

[MT]

[Rs. in Lac]

2350904

2753.59

3086735

3765.70

(ii) Gypsum

130650

524.87

200070

826.87

(iii) Iron Ore & Other additives

171575

547.92

145110

421.71

(i) Limestone

16. Pre-operative Expenses of Rs. 472.76 Lac [includes exchange fluctuation Rs. Nil (Previous Year Rs.191.54 Lac)]
Previous year Rs. 1730.12 Lac have been capitalized.

2000-2001

Quantity

17. The Break-up of remuneration to the Wholetime Directors is given below:

Salary
Contribution to Provident Fund and Superannuation Fund
Other Perquisites

19.10

22.20

5.16

5.99

11.72

10.55

35.98

(d) Value of imports during the period calculated on CIF basis:

2001-2002

2000-2001

[Rs. in Lac]

[Rs. in Lac]

2317.59

(ii) Stores, Spare parts and Components

35.10

459.12

(iii) Capital Goods

28.23

(i) Coal

38.74

18. Expenses charged to limestone (raw material) raising cost during the period:
Salary, Wages, Allowances and Bonus

42.90

42.37

Contribution to Provident Fund,

6.63

7.01

Superannuation Fund and Gratuity Employees Welfare Expenses

6.29

6.71

Royalty & Cess

Stores and Spare consumed
Repair and Maintenance
Travelling
Others

677.23

978.73

84.51

71.33

14.25

(e) Expenditure incurred in foreign currencies:(on cash basis)

7.39

9.64
1402.61

1643.20

2529.45

13.61 (#)

13.25 (#)

17.28

10.04

2.13

87.39

(iii) Others
(#) For Expansion Project Rs. 7.06 Lac (Previous Year Rs. 13.25 Lac)

11.05

804.00

(i) Foreign travel

(ii) Consultancy charges

(f)

Value of imported and indigenous stores, spare parts and components consumed and their percentage to total
consumption:
2001-2002

19. The Equity Shares of the Company are listed in Stock Exchanges of Jaipur, Delhi, Calcutta, Chennai, Mumbai and
National Stock Exchange, Mumbai and the annual listing fee has been paid.

Value

2000-2001
%

[Rs. in Lac]
20. Information pursuant to provisions of paragraphs 3, 4-C and 4-D of Part-II of Schedule VI of the Companies Act, 1956.
2001-2002
[MT]

2000 -2001
[MT]

1685479

2000000

Value

[Rs. in Lac]

Stores, Spare Parts and Components:

Imported
Indigenous

34.73

5.86

76.14

10.79

557.46

94.14

629.32

89.21

(a) Licensed and Installed Capacity and Production (Cement)

(i) Licensed /Registered Capacity(*)
(ii) Installed Capacity(*)

1685479

2000000

(iii) Production

1806358

2383366

(*) As certified by the Management.

108

109

AUDITORS REPORT ON CASH FLOW STATEMENT

21.

Balance Sheet Abstract and Company's General Business Profile as required under
Part IV of Schedule VI to the Companies Act, 1956 :

I.

Registration Details
Registration No.

State Code

0
2
2
3
0
1
3
0
Date
Month
Year
Capital Raised during the Period (Amount in Thousand of Rupees)
Public issue

We have examined the attached Cash Statement of Shree Cement Limited for the period ended 31st March, 2002. The
Statement has been prepared by the Company in accordance with the requirements of Clause 32 of the Listing Agreement
with Stock Exchange and is based on the corresponding Profit & Loss Account and Balance Sheet of the Company, covered
by our report of 26.4.2002 to the members of the Company and reallocation as required for the purpose are as made by the
Company.

Balance Sheet Date

II.

Rights Issue

For B. R. Maheswari & Co.

Chartered Accounts

Private Placement
L
N
I

Bonus issue
L
N
I

III. Position of Mobilisation and Deployment of Funds (Amount in Thousand of Rupees)

Total Liabilities
Total Assets
6

To
The Board of Directors,
Shree Cement Limited.

3
1
0
0
Unsecured Loans

Kolkata
26th April, 2002

Sudhir Maheswari
Partner

SOURCES OF FUNDS
Reserves & Surplus

Paid-up Capital/Application Money

4
9
8
Secured Loans
2

3
6

7
1

2
6

2
Investments

2
2
7
Net Current Assets
9

5
1
2
Misc. Expenditure
0

Accumulated Losses
N

IV. Performance of Company (Amount in Thousand of Rupees)

Turnover
5
2
5
9
7
3
+/ Profit / Loss before tax
+
3
6
7
5
1
Earning Per Share in Rs. (*)
.
0
3
0
1
(*) Annualized
V.

22.

Generic Names of Principal Products Company

Item Code No. (ITC Code)
.
2
2
3
5
2

Total Expenditure
9
0
8
1
3
+/ Profit / Loss after tax
+

Dividend Rate %
1
0

Product Description
C
E M E
N

The figures of the previous year have been regrouped and rearranged wherever necessary.

As per our report of even date

For B. R. Maheswari & Co.
Chartered Accounts

Signature to Schedule 1 to 19

Sudhir Maheshwari
Partner

Kolkata
26th April, 2002
110

R. S. Agarwal
Director

Amount
(Rs. in Lac)

Net Profit Before Tax (As Per Accounts)

Adjustment For Prior Period Items
Net Profit Before Tax & Extra Ordinary Items
Adjustment For :
Depreciation & Misc. Exp. Written Off (net)
Foreign Exchange Loss
Interest/ Dividend Received
Profit on Sale of Investment
Loss/ (Profit) on Sale of Fixed Assets
Interest Expenses
Finance Lease Payments
Operating Profit Before Working Capital Changes
Adjustment For :
Increase/ (Decrease) in Trade And Other Receivables
Increase/ (Decrease) In Inventories
(Increase)/ Decrease in Trade Payables
Cash Generated From Operations
Foreign Exchange Loss Paid
Interest Paid
Direct Taxes Paid
Cash Flow Before Extraordianry Items
Extraordinary/Prior Period Items
Net Cash From Operation Activites

671.53
(11.68)
659.85
4345.07
113.58
(578.21)

17.14
3268.16

(1,143.08)
631.39
(469.20)

7165.74
7825.59

(980.89)
8806.48
(113.58)
(3384.98)
(259.22)
5048.70
11.68
5060.38

B Cash Flow From Investing Activities

B. G. Bangur
Chairman & Managing Director

S. L. Bhansali
Secretary

Amount
(Rs. in Lac)

A Cash Flow From Operating Activities

APPLICATION OF FUNDS
Net Fixed Assets

FOR THE PERIOD ENDED ON 31ST MARCH, 2002

Particulars

Deferred Taxation
5

CASH FLOW STATEMENT

S. K. Somany
Director

H. M. Bangur
Jt. Managing Director

B. R. Gupta
Director

Purchase of Fixed Assets

Sale of Fixed Assets
Acquisition of Companies
Purchase of Investments
Sale of Investments
Interest Received
Dividend Received
Net Cash Used in Investing Activities

(4,302.05)
33.88

(4.99)
239.68
620.96
2.92
(3409.60)

(Contd. next page)

111

CASH FLOW STATEMENT (Contd.)

SUBSIDIARY COMPANYS REPORT & ACCOUNTS

Amount
(Rs. in Lac)

Particulars

Amount
(Rs. in Lac)

SHREE CEMENT MARKETING LIMITED

C Cash Flow From Financing Activities

Proceeds From Share Application Money
Proceeds From Subsidy Received From Government
Proceeds From Long Term Borrowings
Proceeds From Working Capital Borrowings from Banks
Repayment of Finance Lease Liabilities
Dividend Paid
Net Cash From Financing Activites
Net Increase In Cash & Cash Equivalents
Cash & Cash Equivalents As at 01-07-2001 (Opening Balance)
Cash & Cash Equivalents As at 31-03-2002 (Closing Balance)

(3,172.36)
778.14

(594.66)
(2,988.88)
(1338.10)
1891.48
553.38

As per our report of even date

For B. R. Maheswari & Co.
Chartered Accounts

Sudhir Maheshwari
Partner

B. G. Bangur
Chairman & Managing Director

Kolkata
26th April, 2002

S. L. Bhansali
Secretary

R. S. Agarwal
Director

H. M. Bangur
Jt. Managing Director

S. K. Somany
Director

B. R. Gupta
Director

Statement pursuant to Section 212 of the Companies Act,1956 Relating to Subsidiary Company
1. Name of the Subsidiary Company

Shree Cement Marketing Limited

2. Financial Year of the Subsidiary Company ended on

31st March 2002

(Date of Incorporation 11th February, 2002)

3. Holding Companys Interest & Extent of holding

49,930 Shares of Rs. 10/- each fully paid up

representing 99.86% of total issued & paid up
capital of 50,000 shares.

4. Net aggregate amount of Subsidiarys Profit / (Loss) not dealt

with in the Holding Companys Account:
a) For the Current Financial Year
b) For the Previous Year since it become a subsidiary.

Rs. 2925/- (Loss) (Since incorporation)

Not Applicable

5. Net aggregate amount of subsidiarys Profit / (Loss) dealt

with in the Holding Companys Account:
a) For the Current Financial Year
b) For the Previous Year since it become a subsidiary.

Nil
Not Applicable

6. Information Pursuant to Section 212(5)

a) Change in the Holding Companys interest in the Subsidiary
between the end of the Financial year of the Subsidiary and
the end of the Holding Companys Financial Year
b) Any material changes which have occurred between the end of
the Financial Year of the Subsidiary & the end of the Holding
Companys Financial Year in respect of the Subsidiarys:
i)
ii)
iii)
iv)

Not Applicable

Not Applicable

DIRECTORS REPORT

AUDITORS REPORT

Dear Shareholders,

To the Members of
Shree Cement Marketing Limited,

The Directors hereby present their First Annual Report

together with the Statement of Accounts for the period
from 11th February, 2002 (Date of Incorporation) to 31st
March, 2002 as under:
1. The Profit and Loss Account for the period shows
expenses of Rs. 2925/- and no income as company is yet
to start commercial activity and accordingly the excess of
expenditures over Income of Rs. 2925/- for the period is
carried to the Balance Sheet.
2. In accordance with the provisions of the Companies Act,
1956, all the first Directors viz Shri M.K. Singhi , Shri
Diwakar Payal and Shri S.M. Lotia will retire and are
eligible for reappointment.
3. The first Auditors appointed by Board M/s Gopal Agarwal
& Co. will retire at the forthcoming Annual General
Meeting and are eligible for re-appointment. Members
are requested to appoint Auditors and to fix their
remuneration.
4. Pursuant to Section 217(2AA) of the Companies Act,1956
the Directors confirm that they have taken all reasonable
steps, as are required, to ensure that in the preparation of
the accounts for the period ended 31st March,2002 and
that:

i) We have obtained all the information and explanations

which to the best of our knowledge and belief were
necessary for the purpose of our audit.
ii) 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.
iii) In our opinion, the Profit & Loss Account and the Balance
Sheet comply with the Accounting Standards referred to
in Sub-section (3C) of Section 211 of the Companies Act,
1956.
iv) As per the confirmations received from the directors to
the company, none of the directors are disqualified under
Section 274 (1)(g) of the Companies Act, 1956.

They had selected such accounting policy and that

they made judgements and estimates that are
reasonable and prudent so as to give a true and fair
view of the state of affairs of the Company at the end
of the financial year/period and of the profit of the
Company for that period;

v) In our opinion and to the best of our information and

according to the explanations given to us, the said
Accounts read with the notes thereon give the
information required by the Companies Act, 1956, in the
manner so required and give a true and fair view :

They had taken proper and sufficient care for the

maintenance of adequate account records in
accordance with the provisions of this Companies Act,
1956, for safeguarding the assets of the Company and
for preventing and detecting fraud and other
irregularities;

1. In the case of the Balance Sheet of the state of affairs

of the Company as at 31st March, 2002; and
2. In the case of the Profit and Loss Account of the loss
for the period ended on that date.

For Gopal Agarwal & Co.

Chartered Accountants

On behalf of the Board

B. G. Bangur
Chairman & Managing Director

S. L. Bhansali
Secretary

Further to the above we report that :

The Annual Accounts were prepared on a going

concern basis.

Fixed Assets
its investments
the money lent by it
the money borrowed by it for any purpose other than
that of meeting current liabilities

Kolkata
26th April, 2002

As the company is yet to start commercial operations and

has not engaged in any of the activities specified in para 1(2)
of the Manufacturing and other Companies (Auditors
Report) order, 1988, the said order is not applicable.

The applicable accounting standards had been

followed and in case of material departures, the proper
explanation has been given in the accounts and notes
thereon;

M.K. Singhi
Chairman

112

We have examined the attached Balance Sheet of SHREE

CEMENT MARKETING LIMITED as at 31st March, 2002 and
the annexed Profit and Loss Account for the period from
11th February, 2002 (Date of Incorporation) to 31st March,
2002, which are in agreement with the books of account.

R. S. Agarwal
Director

S. K. Somany
Director

H. M. Bangur
Jt. Managing Director

B. R. Gupta
Director

Beawar,
19th April,2002

Beawar
19th April, 2002

Diwakar Payal
Director

Gopal Agarwal

Proprietor

S.M. Lotia
Director

113

BALANCE SHEET AS AT 31ST MARCH, 2002

PROFIT AND LOSS ACCOUNT FOR THE PERIOD ENDED 31ST MARCH, 2002

Particulars

As at 31.3.2002
Rupees

Particulars

For the Period

from 11.2.2002
to 31. 3.2002
Rupees

SOURCES OF FUNDS
Shareholders Funds

Income

(a) Share Capital

Authorised:
50,000 Equity Shares of Rs. 10/- each

5,00,000

Issued, Subscribed and Paid-up

50,000 Equity Shares of Rs. 10/- each fully paid in cash.
(The paid-up capital includes 49,930 Equity Shares of
Rs.10/- each held by Shree Cement Limited-the holding company)

5,00,000

(b) Reserves and Surplus

Total

5,00,000

APPLICATION OF FUNDS
Current Assets, Loans and Advances
Cash and Bank Balances
On Current Account with a Scheduled Bank

4,65,325
4,65,325

Less : Current Liabilities and Provisions:

(a) Current Liabilities - for Expenses
(b) Provision

750
Nil

Net Current Assets

Miscellaneous Expenses
(to the extent not written off or adjusted)
Preliminary Expenses
Profit and Loss Account
Total

750
4,64,575

32,500
2925

35,425
5,00,000

Filing fees
Printing and Stationery
Audit Fees
General Expenses
Total
Profit / (Loss) for the period (beforeTax)
Taxation
Profit / (Loss) for the period (since inception)
Balance Carried to Balance Sheet

600
500
750
1075
2,925
(2,925)

(2,925)
2,925

Notes on Accounts & Accounting Policies (Annexure-1)

As per our Report of even date attached

On behalf of the Board

For Gopal Agarwal & Co.

Chartered Accountants

Gopal Agarwal
Proprietor

M.K. Singhi
Chairman

Diwakar Payal
Director

S.M. Lotia
Director

On behalf of the Board

For Gopal Agarwal & Co.

Chartered Accountants

Gopal Agarwal
Proprietor

Expenditure

Beawar,
19th April, 2002

Notes on Accounts & Accounting Policies (Annexure-1)

As per our Report of even date attached

Total

M.K. Singhi
Chairman

Diwakar Payal
Director

S.M. Lotia
Director

Beawar,
19th April, 2002

114

115

ANNEXURE 1

NOTES ON ACCOUNTS & ACCOUNTING POLICIES

Accounting Policies
All Expenditure and Income are accounted for on accrual basis.

Notes on Accounts
1. The Company was incorporated on 11th February,2002 and yet to start commercial activities. The Accounts are for the
period 11.2.2002 to 31.3.2002.
2. This being first year of the Company, there are no figures for previous year.
3. Additional information pursuant to the provisions of paragraphs 3 and 4 of the Part II of Schedule VI to the Companies
Act, 1956, is not applicable, in absence of any marketing activity.
4. Balance Sheet abstract and Companys General Business Profile as per Schedule VI, Part-IV of the Companies Act, 1956
I Registration Details:
Registration No.

: 17427 of 2001-02

State Code

: 17

Balance Sheet Date : 31 03 2002

II.

Capital raised during the year (Amount in Thousand of Rupees)

Public Issue

: NIL

Right Issue

Bonus Issue

: NIL

PrivatePlacement : 500
(Initial Subscription by theSubscribers to Memorandum)

: NIL

III. Position of Moblisation and Deployment of Funds (Amount in Thousand of Rupees)

Total Liabilities

IV

500

TOTAL ASSETS

: 500

SOURCES OF FUNDS
Paid up-Capital
Secured Loans

:
:

500
Nil

Reserves & Surplus

Unsecured Loans

:
:

Nil
Nil

APPLICATION OF FUNDS
Net Fixed Assets
Net Current Assets
Accumulated Losses

:
:
:

Nil
465
3

Investments
Misc. Expenditure

:
:

Nil
32

Performance of Company ( Amount in Thousand of Rupees)

Turnover
: Nil
Total Expenditure
Profit / Loss ( + / ) before tax
: () 3
Profit / Loss ( + / ) after tax
Earning Per Share in Rs.
: N.A.
Dividend Rate

: 3
: () 3
: Nil

Generic Name of Principal Product of Company:

Item Code No. ( ITC Code)
: N.A.

As per our Report of even date attached

Product Description

On behalf of the Board

For Gopal Agarwal & Co.

Chartered Accountants

Gopal Agarwal
Proprietor
Beawar,
19th April, 2002
116

N.A

M.K. Singhi
Chairman

Diwakar Payal
Director

S.M. Lotia
Director

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