SANSCO SERVICES - Annual Reports Library Services - www.sansco.net VST INDUSTRIES LIMITED ANNUAL REPORT 2007 www.reportjunction.com SANSCO SERVICES - Annual Reports Library Services - www.sansco.net www.reportjunction.com SANSCO SERVICES - Annual Reports Library Services - www.sansco.net CONTENTS VST Industries Limited Page Board of Directors 3 Notice of Meeting 4 Report of the Board of Directors & Management Discussion and Analysis 6 Annexure to the Directors' Report.. 14 Statement Regarding Subsidiary Company 17 Report on Corporate Governance 18 Certification by CEO and CFO 34 Report of the Auditors 35 Balance Sheet 38 Profit and Loss Account 39 Schedules to the Balance Sheet .. 40 Schedules to the Profit and Loss Account 50 Significant Accounting Policies .. 57 Cash Flow Statement 58 Balance Sheet Abstract and Company's General Business Profile 60 Report & Accounts of Subsidiary VST Distribution, Storage & Leasing Company Private Limited 61 Consolidated Financial Statements 74 Operating Results 95 ECS Mandate/Bank Mandate 96 Admission Slip/Form of Proxy 99 www.reportjunction.com SANSCO SERVICES - Annual Reports Library Services - www.sansco.net BOARD OF DIRECTORS VST Industries Limited Chairman ABHIJIT BASU Managing Director RAYMOND S. NORONHA Finance Director & Secretary N. SAI SANKAR Directors ANDREW O'REGAN AIR CHIEF MARSHAL IDRIS HASAN LATIF, P.V.S.M. (Retd. T. LAKSHMANAN R.V.K.M. SURYARAU S.THIRUMALAI Auditors Lovelock & Lewes Chartered Accountants Hyderabad - 500 082 Andhra Pradesh Registered Office 1-7-1063/1065, Azamabad Hyderabad - 500 020 Andhra Pradesh Registrars & Share Transfer Agents Sathguru Management Consultants Private Limited Plot No. 15, Hindi Nagar Near Sai Baba Temple, Punjagutta Hyderabad - 500 034 Phone : 040 - 2335 0586, 2335 6507, 2335 6975 Fax : 040 - 2335 4042 E-mail : [email protected] www.reportjunction.com SANSCO SERVICES - Annual Reports Library Services - www.sansco.net NOTICE OF MEETING VST Industries Limited NOTICE IS HEREBY GIVEN THAT the Seventy Sixth Annual Companies Act, 1956 and in respect of whom the General Meeting of VST INDUSTRIES LIMITED will be held Company has received a notice in writing from a at Hotel Taj Krishna, Road No.l, Banjara Hills, Member proposing his candidature for the office of Hyderabad - 500 034 on Wednesday, 18th July, the Director be and is hereby appointed as a Director 2007 at 10.30 a.m. for transaction of the following of the Company whose period of office shall be liable business: to determination by the retirement of Directors by rotation." 1. To receive, consider and adopt the Audited Balance Sheet as at 31st March, 2007, the Profit and Loss The Register of Members of the Company will remain Account, Auditors' Report and Directors' Report for the closed from 1 6th July, 2007 to 1 8th July, 2007 (both Company's year ended 31st March, 2007. days inclusive) for payment of dividend, if approved. 2. To declare a Dividend on the Ordinary Share Capital. Transfer of shares received in order by the Company's Registrars and Share Transfer Agents, M/s. Sathguru 3. To elect Directors in place of those retiring by rotation. Management Consultants Private Limited, Plot No. 15, 4. To appoint Auditors and to fix their remuneration. In Hindi Nagar, Near Sai Baba Temple, Punjagutta, this connection to consider and, if thought fit, to pass Hyderabad - 500 034, before the close of business the following Resolution which will be proposed as an on 14th July, 2007, will be registered in time for the Ordinary Resolution: transferees to become eligible for dividend, if declared. "RESOLVED that Messrs. Lovelock & Lewes, Chartered Dividend, if approved, will be paid on or before 1 7th Accountants, be and are hereby appointed as the August, 2007 to those shareholders whose names Auditors of the Company to hold such office until the appear in the Register of Members of the Company on conclusion of the next Annual General Meeting at a 1 8th July, 2007 or to their Mandarees, subject however remuneration of Rs. 14,00,000 (Rupees Fourteen lakhs to the provisions of Section 206A of the Companies only) payable in two equal instalments plus service tax Act, 1 956, or any amendment or modification thereof. as applicable and reimbursement of out-of-pocket In respect of dematerialised shares the dividend will be expenses incurred." payable on the basis of beneficial ownership as per details to be furnished by National Securities Depository SPECIAL BUSINESS Limited (NSDL) and Central Depository Services (India) 5. To consider and, if thought fit, to pass with or without Limited (CDSL) for this purpose. modification(s), the following Resolution which will be By Order of the Board, proposed as an Ordinary Resolution: "RESOLVED that Mr. Andrew O'Regan who was N. SAI SANKAR appointed a Director of the Company to fill the casual Secretary vacancy caused by the resignation of Mr. Emil Dated this 1 8th day of April, 2007. Moskofian and who vacates office at the ensuing Azamabad, Hyderabad - 500 020, Annual General Meeting under Section 262 of the Andhra Pradesh. www.reportjunction.com SANSCO SERVICES - Annual Reports Library Services - www.sansco.net VST Industries Limited NOTES 1. A Member entitled to attend and vote at the General Shareholders should inform the Company's Registrars Meeting may appoint a proxy, who need not be a and Share Transfer Agents, M/s. Sathguru Member, to attend and on a poll, to vote on his Management Consultants Private Limited of any change behalf. The proxies should be deposited at the in their registered address, before 1 6th July, 2007. Registered Office of the Company not less than forty eight hours before the commencement of the Shareholders who have multiple folios in identical Meeting. names or joint names in the same order are requested to intimate to the Registrars and Share Transfer Agents, 2. In accordance with Section 173(2) of the Companies M/s. Sathguru Management Consultants Private Limited, Act, 1 956, an Explanatory Statement in respect of item these folios to enable consolidation of all such 5 being item of Special Business is annexed to the shareholdings into one folio. Notice of the Meeting. 6. Shareholders are requested to refer to the "Shareholder 3. In accordance with the provisions of Article 93 of the Referencer" which inter-alia contains details regarding Articles of Association of the Company, Mr. A. Basu unclaimed dividend. and Mr. R.V.K.M. Suryarau will retire by rotation at this Annual General Meeting and being eligible offer 7. Shareholders are requested to bring their copy of the themselves for re-appointment. Annual Report to the Meeting. EXPLANATORY STATEMENT In accordance with Section 173(2) of the Companies Act, Mr. Andrew O'Regan as a Director at this meeting having 1 956, the following information is given in explanation of filed his consent with the Company to act as Director. the items of Special Business set out in the attached Notice Mr. Andrew O'Regan is a Science Graduate and has wide of the Seventy Sixth Annual General Meeting of the knowledge and experience of corporate management. Company to be held at Hotel Taj Krishna, Road No. 1, Currently, he is Managing Director and CEO of Ceylon Banjara Hills, Hyderabad - 500 034 on Wednesday, Tobacco Company Limited, Sri Lanka. 18th July, 2007. No Director of your Company other than Mr. Andrew Item No. 5 O'Regan is concerned or interested in this Resolution. Mr. Andrew O'Regan who was appointed as a Director of The Board commends this Resolution for your approval. the Company on 27th July, 2006 to fill the casual vacancy caused by the resignation of Mr. Emil Moskofian in terms of Section 262 of Companies Act, 1956 and Article 98 of By Order of the Board, the Articles of Association of the Company, vacates office N. SAI SANKAR at this Annual General Meeting. Secretary A notice has been received by the Company along with a Dated this 1 8th day of April, 2007. deposit of Rs.500 from a Member under Section 257 of Azamabad, Hyderabad - 500 020, the Companies Act, 1 956, proposing the appointment of Andhra Pradesh. www.reportjunction.com SANSCO SERVICES - Annual Reports Library Services - www.sansco.net REPORT OF THE BOARD OF DIRECTORS & MANAGEMENT DISCUSSION AND ANALYSIS TO THE SHAREHOLDERS FOR THE YEAR ENDED 31ST MARCH, 2007 VST industries Limited The Directors of your Company have pleasure in presenting their Annual also have a severe impact on volumes Report and Accounts for the year ended 31 st March, 2007. and profitability for the year 2007-08. Financial Results Rs. Lakhs Market Scenario The Net Profit for the year, after Your Company after reversing the trend deducting all charges, expenses of declining volumes in 2004-2005, and taxation but before continued to maintain volumes in line extraordinary item amounts to 5509.17 with last year in spite of price changes Adding thereto Profit brought forward from the of key filters and micros in 2006-2007. previous year 5145.04 This was made possible primarily through expanding the consumer base The amount available for disposal was 10654.21 in the micro segment, both in existing areas of operations, as well as in Out of which the following appropriation has been made : previously unrepresented geographies, and by successfully launching an General Reserve 600.00 extension of a key filter brand. Leaving a balance of 10054.21 In the micro plain segment, distribution Out of which your Board recommends 3613.25 focus resulted in the growth of Should be distributed as Dividend on the Charminar Standard. Your Ordinary Share Capital at the rate of Company's second largest micro brand Rs.20 per share and inclusive of Shaan grew significantly, particularly Dividend Tax in previously unrepresented areas of Uttar Pradesh and Madhya Pradesh.