Indage Vintners Ltd. के निदेशक की रिपोर्ट

Mar 31, 2010

The Directors present the 25th Annual Report together with the Audited Statement of Accounts (Standalone) for the year ended 31st March, 2010.

As you are aware about the difficulties faced by the Company arising out of an acute financial crunch to legal actions of creditors including a winding up order passed against the Company and the subsequent Composite Scheme of Arrangement filed in the Honble Bombay High Court, we are at presently only adopting the standalone results of your Company for the approval of the members.

We are providing true and fair picture of the Company before you and at this juncture only standalone figures are available since the subsidiaries of the Company have also experienced similar problems of a financial and while they carry out the due compliances, the management has taken a view of presenting the standalone results only. Furthermore, the views expressed by the Company Management and its Directors are purely based on the standalone figures only.

FINANCIAL RESULTS: (Standalone)

Year ended Year ended

PARTICULARS 31.3.2010 31.3.2009 (Rs.) (Rs.)

Sales & other income including increase in Finished Goods & Work in Progress 31,07,15,165 1,52,91,12,283

Loss before Interest and Depreciation (37,04,44,749) (27,12,80,395)

Interest 46,53,01,350 33,30,87,677

Depreciation 2,71,17,629 4,80,58,232

Exceptional Item 1,36,99,32,889 -

Profit / (Loss) for the year (2,23,27,96,617) (65,24,26,304)

Less :

Provision for Taxation - 1,13,17,835

Deferred Tax Adjustments - (5,67,44,374)

Net Profit / (Loss ) After Tax (2,23,27,96,617) (60,69,99,765)

Less: Transfer to Debenture Redemption Reserve - -

Less: Minority Interest and Transfer to capital reserve - -

Add: Balance brought forward from Previous year (8,94,64,794) 52,50,00,000

Less: Prior Period Expenses - 74,36,583

Less: Prior period short provision for Tax 98,69,319 28,446

Balance Available for appropriation (2,33,21,30,730) (8,94,64,794)

Appropriations:_

Proposed Dividend on Equity Shares - -

Tax on Dividend - -

Transfer to General Reserve - -

Balance Carried to the Balance Sheet (2,33,21,30,730) (8,94,64,794)



FINANCIAL PERFORMANCE :

During the year under review, the Company has suffered heavy losses. Sales throughout the year were at a bare minimum in the absence of any working capital in the business which affected the basic ability of your Company to convert raw materials to work-in-progress to finished goods to debtors and, ultimately, into cash. Given the widespread negative publicity in leading publications and other media, the problem was only exasperated with falling share prices and low to negative confidence amongst the trade suppliers and buyers. Although the Company has managed to significantly cut costs to sustain a bare minimum level of operations, costs such as interest continue to be heavy for a majority of the financial year as well as the burden of maintaining the high level of inventory is also reflected in the other expenses.

While the reasons for the drastic reduction in performance levels of your Company are multiple and the list of problems faced by the Company being numerous, the Management is taking steps to regain and revive your Company to its original position as the leading wine producer of India. The Directors of your Company assure you about the Companys bright future ahead and are hopeful in achieving subsequent improvements in the overall performance of the Company in years to come.

DIVIDEND:

The Company follows the policy of paying stable dividend linked to consistent performance, while at the same time keeping in view the need to finance the growth plans through internal accruals This will eventually lead to increased shareholder value and higher returns. However, for the year ended 31st March, 2010, the Board of Directors has not recommended a dividend due to heavy losses suffered by the Company.

SUBSIDIARIES:

To complement and strengthen the products and the entire supply chain in order to meet customer expectations globally, your Company implemented an acquisitive growth policy during the year under review on the International front. This strategy has further enhanced the inherent strengths of your Company. However, since some of the acquisitions were made very close to the global financial meltdown and the subsequent inability of your Company to raise funds overseas in order to meet with the working capital needs of the newly acquired businesses, the businesses acquired remain in a fragile condition.

As on 31st March, 2010, your Company has the following Subsidiaries :

1) Seabuckthorn Indage Ltd., India (522.63% shareholding).

2) Indage Holdings Ltd., U.K, (Wholly Owned)

3) Thachi Wines Pty Ltd., Australia (100% Step Down Subsidiary)

The Company had one more subsidiary Indage (UK.) Ltd., UK. (100% Step Down Subsidiary) as on 31st March, 2009. Although the UK subsidiary had high hopes for success, the business suffered due to a lack of working capital and, compounded by the negative publicity in India, most overseas trade partners declined to work with the newly acquired business and the creditors preferred to wind up and liquidate the business despite a creditors voluntary arrangement ( CVA) being filed and approved by the Company and its creditors. Therefore, the investment in the said subsidiary has been, unfortunately, written off by the Company during the year under consideration.

As mentioned above, the Company is unable to present the Consolidated Audited Accounts in this Annual General Meeting due to non - finalization of the accounts of all its subsidiaries. However, the Company is taking various steps to finalize the accounts of the subsidiaries and shall present the Consolidated Accounts at the earliest.

The Company has also made an application to the Registrar of Companies vide e- Form 23AAB on 07th August, 2010 in order to claim exemption from attaching the documents of subsidiaries as specified under Section 212(1) of the Companies Act, 1956. The approval regarding the same is still not received from the Ministry of Corporate Affairs, Government of India.

FUTURE PROSPECTS :

The Company is in process of finalization of the Composite Scheme of Arrangement and Compromise with Industrial Agencies Indage Private Limited (IAIPL).

A Court Convened Meeting of all categories of stakeholders of the Company i.e. Equity Shareholders, Secured Lenders, Preference Share Applicants, Unsecured Lenders, Fixed Deposit Holders, Other Creditors was held on 16* September, 2010. The said scheme was passed with requisite majority.

The Company at present is awaiting a positive outcome from the Divisional Bench of Honble Bombay High Court in the matter of Composite Scheme of Arrangement between the Company and Industrial Agencies Indage Private Limited is being heard by the Honble Court.

Despite the difficulties faced by the Company, the assets of the business have been maintained to a very high standard and the stocks are well preserved. The market for wine in India will continue to grow as the alcoholic beverage industry matures in size and trends. Your Companys brands still remain in demand and, if the challenges to supply and restart the business are addressed, the Management of your Company has no doubts of the vast future potential of the business and return to healthy profits.

DIRECTORS:

Mr. Arun B Shah, Director is retiring by rotation at the ensuing Annual General Meeting and being eligible offer himself for re-appointment. In terms of Clause 49 of the Listing Agreement with BSE, the details of this Director is given in the accompanying Corporate Governance Report.

DIRECTORS RESPONSIBILITY STATEMENT:

As required under Section 217(2AA) of the Companies Act, 1956, the Directors confirm that :

1) In preparation of Annual Accounts the applicable accounting standards have been followed along with proper explanation and that no material departures have been made from the same.

2) Accounting policies selected & applied are on a consistent basis & judgments and estimates made are reasonable & prudent so as to give a true & fair view of the state of affairs of the Company at the end of the financial year and of the Profit & Loss of the Company for that period.

3) Sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities.

4) Annual accounts have been prepared on a going concern basis.

CORPORATE GOVERNANCE:

Your Company has complied with the mandatory provisions of Corporate Governance stipulated under Clause 49 of the Listing agreement (as amended). The Management Discussion & Analysis, - Report on Corporate Governance and Certificate from the Auditors of the Company certifying compliance of conditions of Corporate Governance are annexed herewith and forms part of this Annual Report.

Your Company has also laid down a Code of Conduct for its Board Members and Senior Management Personnel. All the Directors and the Senior Management Personnel have affirmed compliance with the said Code of Conduct.

However, due to the numerous problems faced by the Company and significant reduction in management bandwidth, the management has not performed any internal audits of its operations during the year under review but is hopeful for completing the same at the earliest.

FIXED DEPOSIT :

Out of the total 1576 deposits of Rs 4,18,17,000/- from the public as at 31st March, 2010, 24 (Twenty Four) deposits amounting to Rs.3,90,000/-were matured but not claimed. Subsequently, 5 (Five) matured deposits were claimed and paid amounting to Rs. 60,000/- in aggregate.

EMPLOYEE STOCK OPTION / PURCHASE SCHEME (ESOS) :

Your Company has introduced an Employee Stock Option Scheme and Employee Stock Purchase Scheme - 2005. However, no grants have been made thereunder during the financial year.

AUDITORS :

M/s Sorab S. Engineer & Co. Chartered Accountants, retire as Auditors at the conclusion of the ensuing Annual General Meeting and are eligible for reappointment. The members are requested to appoint the Auditors and fix their remuneration.

PARTICULARS OF EMPLOYEES :

During the financial year, your Company has not employed any employee whose particulars are required to be disclosed in this report pursuant to Section 217 (2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) (Amendment) Rules, 2000.

CONSERVATION OF ENERGY:

The Company has constantly made efforts to prevent and reduce excessive energy consumption by making use energy efficient technology and equipments. The Company is also aware of importance of conservation of energy and has taken serious steps in this regards.

RESEARCH & DEVELOPMENT:

Your Company has set up modern microbiological testing facilities to ensure quality control. During the year under review your Company has maintained a system and procedure to qualify for certification under ISO 9001 / HACCP,

TECHNOLOGY ABSORPTION, ADAPTATION & INNOVATION :

Your Company has already adopted the latest techniques in winemaking and production and, therefore, no new technology has been adopted during the year.

FOREIGN EXCHANGE EARNINGS & OUTGO :

PARTICULARS Year ended 31.3.2010 Year ended 31.3.2009

(Rs.) (Rs.)

Foreign Exchange

(i) Earnings 4,96,59,470 10,06,95.029

(ii) Outgo 4,68,11,312 3,14,05,169

ACKNOWLEDGEMENTS & APPRECIATION

Your Directors are thankful and are obliged by the continuous faith and support it has received over such a long period of time from various authorities including Banks and Government Authorities and also from shareholders including all categories of persons associated with the Company. The Company also acknowledges its deep appreciation of all its industry partners, buyers and suppliers who have kept faith in the revival of the business and provided timely support.

Your Directors are delighted to express their gratitude towards the long lasting support the employees have given and are extremely thankful for the same.

For and on behalf of the Board

Sd/-

Place:Mumbai S. G. Chougule

Date : 14th February, 2011 Chairman

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Mar 31, 2009

The Directors present the 24m Annual Report together with the Audited Statement of Accounts for the year ended 31s1 March, 2009

FINANCIAL RESULTS (Rs. in Million)

Year ended Year ended Particulars 31-03-2009 31-03-2008 Consolidated Consolidated (Rs.) (Rs.)

Sales & other income 2913.06 4055.33

including increase in Finished

Goods & Work in Progress

Profit / (Loss) before Interest and (893.59) 748.18 Depreciation

Interest 426.99 167.12

Depreciation 71.85 71.46

Profit / (Loss) for the year (1392.43) 509.60

Less Provision for Taxation 11.32 102.18

Deferred Tax Adjustments (56.74) 18.58

Net Profit / (Loss ) After Tax (1347.00) 388.85

Less: Transfer to Debenture 0.00 5.00 Redemption Reserve

Less: Minority Interest and 0.00 2.29 Transfer to capital reserve

Add: Balance brought 761.94 209.36 forward from Previous year

Less: Prior period short 99.01 1.40 provision for Tax

Balance Available (684.06) 589.52

for appropriation

Appropriations:

Proposed Dividend on 0.00 32.08 Equity Shares

Tax on Dividend 0.00 5.45

Transfer to General Reserve 0.00 39.48

Balance Carried to the (684.06) 512.51 Balance Sheet

Particulars Year ended Year ended 31-03-2009 31-03-2008 (Rs.) (Rs.)

Sales & other income including increase in Finished Goods & Work in Progress 1233.95 2649.35

Profit / (Loss) before Interest and Depreciation (271.28) 689.69

Interest 333.09 139.99

Depreciation 48.06 46.19

Profit / (Loss) for the year (652.43) 503.51

Less Provision for Taxation Deferred Tax Adjustments 11.31 82.88

Net Profit / (Loss ) After Tax (56.74) 21.59

Less: Transfer to Debenture Redemption Reserve (607.00) 399.04

Less: Minority Interest and Transfer to capital reserve 0.00 5.00

Add: Balance brought forward from Previous year NA NA

Add: Balance brought forward from Previous year 525.00 209.37

Less: Prior period short provision for Tax 7.46 1.4

Balance Available for appropriation Appropriations: (89.46) 602.01

Proposed Dividend on Equity Shares 0.00 32.08

Tax on Dividend 0.00 5.45

Transfer to General Reserve 0.00 39.48

Balance Carried to the Balance Sheet (89.46) 525.00

PERFORMANCE

According to above mentioned facts and figures it can be seen that, during the year Company has suffered heavy losses. The reason behind such losses is, the Company had gone through some unforeseen events, which badly affected Company s profit making capability.

The Directors are hopeful about further and future improvement in the performance of the Company and assure you that they will try to regain the Companys original position in the market on early basis.

DIVIDEND

The Company follows the policy of paying stable dividend linked to consistent performance, while at the same time keeping in view the need to finance the growth plans through internal accruals. This will eventually lead to increased shareholder value and higher returns.However,for the year ended 31st March, 2009, the Board of Directors has not recommended any dividend due to heavy losses suffered by the Company.

SUBSIDIARIES

To complement and strengthen the products and to meet customer expectations globally, your Company implemented an acquisitive growth policy during the year under review on the International front. This strategy has further enhanced the inherent strengths of your Company.

As on 31st March, 2009, your Company has the following Subsidiaries :

1) Seabuckthorn Indage Ltd., India (52.63% shareholding).

2) Indage Holdings Ltd., U.K. (Wholly Owned)

3) Thachi Wines Pty Ltd., Australia (100% Step Down Subsidiary)

4) Indage (U.K.) Ltd., U.K. (100% Step Down Subsidiary)

The Ministry of Corporate Affairs, Government of India vide its letter dated 19lh February, 2008 granted approval under section 212 (8) of the Companies Act, 1956 exempting the Company from attaching the documents of subsidiaries as specified under section 212 (1) of the Companies Act, 1956. Pursuant to such approval, the Annual accounts of the Company are made available to you.

A statement pursuant to Section 212 of the Companies Act, 1956 in respect of Subsidiary Companies is annexed herewith and forms part of this Annual Report.

As required under the Listing Agreement with the Bombay Stock Exchange Ltd., (BSE) attached herewith is a Consolidated Financial Statement of your Company with its aforesaid Subsidiaries prepared in accordance with Accounting Standard AS-21 issued by the Institute of Chartered Accountants of India.

FUTURE PROSPECTS

At present the Company is in the process of overcoming all the Odds against the Company and also simultaneosly looking for various diversification, expansion with proper internal control.

Some of the odds/ problems are slow down in the wine industry, general downturn in the domestic market, changes in the labelling laws in Maharashtra, changes in State Excise rates, accumulation of stocks, liquidity stress on account of overseas acquisitions and etc.

The Management of your Company has despite of above difficulties is very confident and striving all the very best to ensure revival of your Company.

DIRECTORS

Mr. Sohrab R. Framjee Director is retiring by rotation at the ensuing Annual General Meeting and being eligible offer himself for re-appointment. In terms of Clause 49 of the Listing Agreement with BSE, the details of the Director are given in the accompanying Corporate Governance Report.

DIRECTORS RESPONSIBILITY STATEMENT

As required under Section 217(2AA) of the Companies Act, 1956, the Directors confirm that :

1) In preparation of Annual Accounts the applicable accounting standards have been followed along with proper explanation and that no material departures have been made from the same.

2) Accounting policies selected & applied are on a consistent basis & judgments and estimates made are reasonable & prudent so as to give a true & fair view of the state of affairs of the Company at the end of the financial year and of the Profit & Loss of the Company for that period.

3) Sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting frauds and other irregularities.

4) Annual accounts have been prepared on a going concern basis.

CORPORATE GOVERNANCE

Your Company has complied with the mandatory provisions of Corporate Governance stipulated under Clause 49 of the Listing agreement (as amended). The Mangement Discussion & Analysis, Report on Corporate Governance and Certificate from the Auditors of the Company certifying compliance of conditions of Corporate Governance are annexed herewith and forms part of this Annual Report.

Your Company has also laid down a Code of Conduct for its Board Members and Senior Management Personnel. All the Directors and the Senior Management Personnel have affirmed

compliance with the said Code of Conduct. A declaration by the Managing Director regarding the compliance by Board Members and Senior Management Personnel with the Code of Conduct is also made a part of this Annual Report.

FIXED DEPOSIT

Out of the total 755 deposits of Rs. 17.15 million from the public as at 31st March, 2009, 9(Nine) deposits amounting to Rs.0.11 million were matured but not claimed. Subsequently, four matured deposits were claimed and paid amounting to Rs. 0.05 million in aggregate.

EMPLOYEE STOCK OPTION / PURCHASE SCHEME (ESOS)

Your Company has introduced an Employee Stock Option Scheme and Employee Stock Purchase Scheme - 2005. However, no grants have been made thereunder during the year under review.

AUDITORS

M/s Sorab S. Engineer & Co. Chartered Accountants, retire as Auditors at the conclusion of the ensuing Annual General Meeting and are eligible for reappointment. The members are requested to appoint the Auditors and fix their remuneration.

PARTICULARS OF EMPLOYEES

During the year under review, your Company has not employed any employee whose particulars are required to be disclosed in this report pursuant to Section 217 (2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) (Amendment) Rules, 2000.

CONSERVATION OF ENERGY

Significant measures have been taken to reduce energy consumption by using energy efficient technology and equipments. The Company constantly evaluates new technologies and investments to make our infrastructure more energy efficient.

Each year your Company obtains a large quantity of Bio-Mass for which efforts are being made to set up a plant for production of Bio-gas which can generate electric energy. Your Company has already acquired a License and technology from BARC for the same.

RESEARCH & DEVELOPMENT

Your Company has set up modern microbiological testing facilities to ensure quality control. During the year under review your Company has maintained a system and procedure to qualify for certification under ISO 9001 / HACCP.

TECHNOLOGY ABSORPTION, ADAPTATION & INNOVATION

Your Company ensures to achieve better economies of production and continues to focus on developing new, innovative and high quality products to meet the ever changing consumer needs and drive growth. Your Company insists upon the use of better technology & know how without compromising on the quality of the products.

Your Company has plans to produce Organic wines which currently are in demand globally, and has tied up with Chirayu Herbal Biotech (India) Private Ltd. for the production of Bio-fertilizers, Bio-fungicides and Bio-pesticides for the application in existing vineyards as well as for supply to all the Contract Growers. This will enable your Company to obtain certified Organic Grapes and produce certified Organic Wines.

FOREIGN EXCHANGE EARNINGS & OUTGO

Year ended 31-03-2009 Year ended 31-03-2008

Particulars (Rsin million) (Rs in million)

Foreign Exchange

(i) Earnings 90.43 66.96

(ii) Outgo 31.39 32.09

ACKNOWLEDGEMENTS & APPRECIATION

Your Directors express their grateful appreciation for the support and co-operation received from Banks, Government Authorities in India and overseas, its customers, retailers, stockists, suppliers of goods/services, clearing and forwarding agents and all other Business Associates.

Your Directors are happy to place on record their gratitude to the employees at all levels for their commitment and dedicated efforts. The Directors are also thankful to the Shareholders for their continued support and confidence.

For and on behalf of the Board

Place : Mumbai S G Chougule Date : 23rd July, 2010 Chairman