SKM Egg Products Exp India Ltd-532143-March-2001

SKM EGG PRODUCTS EXPORT
(INDIA) LIMITED
Regd. Office : 180, Gandhiji Road, Erode - 638 001.
SIXTH ANNUAL REPORT

2000 - 2001
EXCELLENCE - OUR GOAL
SERVICE - OUR MOTTO
QUALITY - OUR OBSESSION
Transforming the Egg into a symbol of Indian Excellence abroad

SKM EGG PRODUCTS EXPORT (INDIA) LIMITED
180, Gandhiji Road, Erode - 638 001
BOARD OF DIRECTORS Shri. SKM. MAEILANANDHAN

Chairman and Managing Director
Shri. S.K.M. SHREE SHIVKUMAR
Executive Director
Dr.M.CHANDRASEKAR
Shri. P. SHANMUGASUNDARAM
(TIDCO Nominee)
Smt. SARADA N. MENON
(IFCI Nominee)
Shri. S.M. VENKATACHALAPATHY
Dr. L.M.RAMAKRISHNAN
Shri.M.CHINNAYAN
Shri.P.KUMARASAMY
COMPANY SECRETARY Shri.G.N.VARADARAJAN BCom, F.C.S.,
MANAGEMENT EXECUTIVES
GENERAL MANAGER - FINANCE Shrl.R.MURALIDHARAN BCom, F.C.A.,
GENERAL MANAGER - OPERATIONS Shri. S. HARIHARAN B.Sc, B.Tech., (FoodTech.,)
AUDITORS N.C.RAJAGOPAL & CO.,

Chartered Accountants,
199, Agraharam Street,
ERODE-638 001.
BANKERS STATE BANK OF INDIA

Commercial Branch,
ERODE-638 003.
REGISTERED OFFICE 180, Gandhiji Road,

Erode-638 001.
ERODE DISTRICT.
FACTORY Erode to Karur Main Road,

Solangapalayam,
Punjai Kilambadi Village,
ERODE DISTRICT - 638 154.

180, Gandhiji Road, Erode - 638 001
NOTICE
Notice is hereby given that the Sixth Annual General Meeting of the Members of the Company will be
held on Thursday, the 27th September 2001 at 4.00 p.m. at Kongu Kalaiarangam, E.V.K.Sampath
Nagar, Erode - 638 011 to transact the following business :
ORDINARY BUSINESS:
1. Consideration of Accounts :
To consider and pass the following resolution as an ordinary resolution ;
"RESOLVED that the Balance Sheet as at 31 st March, 2001 and the Profit and Loss Account for the year
ended 31st March, 2001, together with the Reports of Directors and Auditors thereon be and are hereby
approved".
2. Appointment of Director in the place of a retiring Director:

To consider and pass the following resolution as an ordinary resolution ;
"RESOLVED that Dr. M. Chandrasekar, a director retiring at this meeting be and is hereby appointed as a
Director of the Company".
3. Appointment of Director in the place of a retiring Director:

To consider and pass the following resolution as an ordinary resolution :
"RESOLVED that Shri. S.M. Venkatachalapathy, a director retiring at this meeting be and is hereby appointed
as a Director of the Company".
4. Appointment of Auditors and fixing of their remuneration :

To consider and pass the following resolution as a special resolution :
"RESOLVED that M/s. N.C. Rajagopal & Co., Erode, the retiring auditors be and are hereby appointed as
auditors for the Company to hold office from the conclusion of this Annual General Meeting till the conclusion
of the next Annual Genera! Meeting on such remuneration to be fixed by the Board of Directors of the
Company, plus reimbursement of out-of-pocket expenses".
SPECIAL BUSINESS :
5. To consider and if though fit to pass the following resolution with or without modification as
an ordinary resolution:
"RESOLVED that pursuant to the provisions of Sections 198,309,310,311 and other applicable provisions, if
any, of the Companies Act, 1956 read with Schedule XIII of the said Act. as amended from time to time, the
reappointment of Shri. SKM. Maeilanandhan as Managing Director of the Company for a Period of five years
from 26th June 2001 to 25th June 2006 be and is hereby approved on the following terms and conditions.
1. Salary : Rs. 45,000/- per month in the scale of Rs.45,000-5,000-65,000/-.

2. House Rent Allowance: 50% of the salary
3. Other perquisites :
(a) The expenditure incurred by the Managing Director on gas, electricity, water and furnishings shall be
reimbursed by the Company, subject to a maximum of 10% of the Salary.
(b) All medical expenses, incurred by the Managinge Director for self and his family shall be reimbursed.
(c) Leave Travel Concession for the Managing Director and his family will be allowed as per the rules of
the Company.
(d) Fees of clubs subject to a maximum of two clubs; this will not include admission and life membership
fees.
(e) Personal Accident Insurance, the premium of which shall not exceed Rs.10,000/- per annum.
(f) Contribution to Provident Fund, Superannuation Fund as per the rules of the Company.
(g) Gratuity as per the provisions of the payment of Gratuity Act or as per the Gratuity Scheme of the
Company whichever is higher.
(h) Provision of car with driver for use in Company's business and telephone at the residence.
(i) Leave unavailed will be allowed to be encashed as per the rules of the Company.
Minimum Remuneration :
The above appointee shall be paid the same remuneration as stated above as minimum remuneration, in the
event of absence or inadequacy of profit subject to the ceiling on minimum remuneration as stated in
Section II, Part II of Schedule XIII of the Companies Act, 1956 with such modifications as may be made
therein from time to time.
6. To consider and if though fit to pass the following resolution with or without modification as an
ordinary resolution:
"RESOLVED that pursuant to the provisions of Sections 198,309,310,311 and other applicable provisions, if
any, of the Companies Act, 1956 read with Schedule XIII of the said Act, as amended from time to time, the
reappointment of Shri. S.K.M. Shree Shivkumar as Executive Director of the Company for a Period of five
years from 26th June 2001 to 251h June 2006 be and is hereby approved on the following terms and conditions.
1. Salary : Rs. 40,000/- per month in the scale of Rs.40,000-4,000-56,000/-.
2. House Rent Allowance: 50% of the salary
3. Other perquisites:
(a) The expenditure incurred by the Executive Director on gas, electricity, water and furnishings shall
be reimbursed by the Company, subject to a maximum of 10% of the Salary.
(t>) AH medical expenses, incurred by the Executive Director for self and his family shall be reimbursed.
(c) Leave Travel Concession for the Executive Director ancf his family will be allowed as per the rules of
the Company.
(d) Fees of clubs subject to a maximum of two clubs; this will not include admission and life membership
fees.
(e) Personal Accident Insurance, the premium of which shall not exceed Rs.10,000/- per annum.
(f) Contribution to Provident Fund, Superannuation Fund as per the rules of the Company.
(g) Gratuity as per the provisions of the payment of Gratuity Act or as per the Gratuity Scheme of the
Company whichever is higher.
(h) Provision of car with driver for use in Company's business and telepone at the residence,
fi) Leave unavailed will be allowed to be encashed as per the rules of the Company.
Minimum Remuneration :
The above appointee shall be paid the same remuneration as stated above as minimum remuneration, in the
event of absence or inadequacy of profit subject to the ceiling on minimum remuneration as stated in
Section II, Part II of Schedule Xifl of the Companies Act, 1956 with such modifications as may be made
therein from time to time.
7. To consider and if thought fit to pass the following resolution with or without modification as a
special resolution :
"RESOLVED that the consent of the Company be and is hereby accorded to the Board of Directors pursuant
to provision of Section 81 (1 A) and other applicable provisions in the Companies Act. 1956, to issue 73,67,500
further equity shares of Rs.10/- each of the Company, to such persons ether than end including existing
shareholders of the Company".
"FURTHER RESOLVED that the equity shares of Rs.10/- each to be issued by the Company as above shall
be issued as fully paid-up shares and allotted at Rs.10/- per share or at the o^ce to be determined as per
SEB1 guidelines for preferential allotment, whichever is higher.
"FURTHER RESOLVED that the equity shares as above shall be allotted by the directors in one or more
tranches subject however that the allotment of these share? shall be completed within a period of 3 months
from the date of this Annual Genera! Meeting",
"FURTHER RESOLVED that the shares to be issued as above shall rank pari passu with the existing equity
shares of the Company in all respect".
By Order of the Board of Directors
Place : Erode G.N.VARADARAJAN

Date : 31.07.2001 Company Secretary
NOTES:
1. A member entitled to attend and vote, is entitled to appoint one or more proxies to attend and vote
instead of himself, and proxy need not be a member.
2. Proxies, in order to be effective should be duly completed, stamped and signed and must be deposited
at the Registered Office of the Company not less than 48 hours before the Meeting.
3. The Register of Members and Share Transfer Registers will remain closed from 25th September 2001
to 27th September 2001 both days inclusive,
4. Explanatory Statement as required under Section 173(2} of the Companies Act, 1956, in respect of
Special Business in annexed.
EXPLANATORY STATEMENT UNDER SEC. 173(2)

OF THE COMPANIES ACT, 1956
Item No. 4 :
In terms of Sec.224A of the Companies Act, 1956 Auditors, appointment requires a special resolution if
holding of shares by public financial institutions is in excess of 25% of the subscribed share capital of the
Company. Presently, about 11 % of the shares of the Company are held by a public financial institution. As
the Company's shares have been dematerilised, the Company wilt not have information before-hand regarding
combined shareholding of the pubfic financial institutions as on the date of AGM. Threrefore, as a matter of
caution, a special resolution is proposed for appointment of auditors.
Item No. 5 :
The period of appointment of Shri. SKM. Maeilanandhan as Managing Director as approved by the shareholders
at the Extra-ordinary General Meeting held on 26.06.1996 expired on the close of 25th June 2001. The Board
of Directors at its meeting held on 31 s1 July 2001 reappointed Shri. SKM. Maeilanandhan as the Managing
Director of the Company for a fresh term of 5 years with effect from 26'h June 2001 on the terms indicated in
the resolution. The Company had achieved reasonable growth over the years, despite adverse market
conditions due to proper guidance and various initiatives taken as per suggestions made by the Managing
Director. In order that the level of growth is sustained and improved upon, it will be in the interest of the
Company that Shri. SKM. Maeilanandhan is reappuinted as Managing Director for a further period of 5 years.
The Board of Directors recommend the resolution to shareholders for approval.
This explanatory statement together with the accompanying notice may be treated as an abstract of the
terms of remuneration payable to Shri. SKM. Maeilanandhan, pursuant to Sec. 302 of the Companies Act,
1956.
Shri. SKM. Maeilanandhan, is interested in this resolution as it concerns his reappointment.
Shri S.K.M. Shree Shivkumar and Dr. M. Chandrasekar are interested in this resolution as relatives of the
appointee.
The Shareholders may please note that Shri. SKM. Maeilanandhan has not drawn any remuneration from the
Company since the day of his appointment (i.e. from 26.06.1996).
Item No.6 :
The period of appointment of Shri. S.K.M. Shree Shivkumar, Executive Director as approved by the
shareholders at the Extra-ordinay General Meeting held on 26/06/1996 expired on the close of 25/6/2001.
The Board of Directors at its meeting held on 31 s1 July 2001 reappointed Shri. S.K.M. Shree Shivkumar
as Executive Director of the Company for a fresh term of 5 years with effect from 26th June 2001 on the
terms indicated in the resolution.
The Company has registered good growth over the years, although the industry was experiencing a difficult
period, for which the Executive Director has put streneous efforts. He has taken pains to ensure that the
Company's performance does not suffer despite unfavourable conditions prevailed in the egg powder industry
over a considerably long period of 3 years. In order that the growth is maintained at higher levels, it is
essential that Shri. S.K.M. Shree Shivkumar is reappointed as Executive Director for a further period of 5
years. The Board of Directors recommends the resolution to shareholders for approval.
The shareholders may please note that as per schedule XIII of the Companies Act, 1956, the appointee is
entitled to be paid a gross monthly remuneration of Rs.1.50 lacs and the remuneration fixed by Board is only
reasonable.
5
The explanatory statement together with the accompanying notice may be treated as an abstract of the
terms of remuneration payable to Shri. S.K.M. Shree Shivkumar, pursuant to Sec. 302 of the Companies
Act, 1956.
Shri. S.K.M. Shree Shivkumar is interested in this resolution as it concerns his reappomtrnent. Shri. SKM.
Maeilanandhan and Dr. M. Chandrasekar are interested in this resolution as relatives of the appointee.
Item No.7 :
As the shareholders are aware, the Company has entered into an OTS agreement with iFC! Limited with
25% of the loan amount being down payment. To meet this requirement and payment of first quarterly
instalment due on 15lh July,2001, the Company has raised funds by accepting share application money from
the promoters of the Company aggregating Rs. 754.75 Lacs. Against this share application money it is
proposed to allot shares for Rs. 736.75 lacs on preferential basis as per the SEB! guidelines to the applicants.
The shareholding pattern of the allottees will be as given below after allotment o' these shares and the
allotment will not result in any change in management.
Proposed % of Shares
Appln. % of Shares
allotment (approximate)
Name of the Applicant Amount held
(Rs. in after allotment
(Rs. in Lacs) Lacs) at present
as above
1. SKM Animal Feeds and Foods (India) Ltd.

2. Shri. SKM. Maeilanandhan
3. Smt. M. Kuttilakshimi
TOTAL 754.75 736.75
As per SEBI guidelines, the shares that are to be ssued and allotted to these applicants shall be treated as
Preferential Allotment and shall be priced at not less than the average of weekly high/low of closing prices
quoted on the Stock Exchange where the shares of the Company are most frequently traded during the last
6 months or 2 weeks preceding tfie relevant date, whichever is higher
Approval of shareholders is required by a Special Resolution under section 81 (1 A) of the Companies Act,
1956 for issue/allotment of these shares to the above applicants. The directors recommend the resolution
for adoption.
Shri. SKM. Maeiianandhan, Chairman and Managing Director is interested to the extent of the shares to be
allotted to him, to his witer and as Managing Director of M/s. SKM. Animal Feeds and Foods (India) Limited.
Shri. S.K.M. Shree Shivkumar, Executive Director and Dr. M Chandrasekar, Director are interested as
relatives of Shri. SKM. Maeilanandhan and Smt. M. Kuttilakshimi and as directors of SKM Animal Feeds
and Foods (India) Limited.
DIRECTORS' REPORT
The Directors have pleasure in presenting the Sixth Annual Report of the company together with the audited
Accounts of your company for the year ended 31 st March 2001.
OPERATIONS :
During the year, the company produced 2080 Tonnes and exported 1840Tonnes of egg powder valued about
Rs. 27.32 Crores, representing an increase of 131% in volume and 138% in value, compared with previous
year's turnover.
The Egg powder market has started to pick-up and the international price for the product is increasing
steadily. The future prospects for our product is expected to be good considering the difference in cost of
production of eggs which is cheaper in India compared to that of our competing countries mainly European
Union and USA. The competitiveness will further enhance as the subsidy / farm support will be phased out
gradually in these countries under the WTO recommendations. As the Company has already established a
name as quality suppliers of egg products in the global market and as good opportunities are ahead, the
sales for the year is expected to substantially increase. During the first quarter of the current year, the
Company has achieved an export turnover of about 595 MTs, valued at Rs. 9.38 Crores.
FINANCIAL RESULTS:
Financial results of the company for the year ended 31 st March 2001 are given below:
Rs. in lacs
Particulars 2000-2001 1999-2000
Total Income 2749.93 1157.36
Total Expenditure 2464.78 1048.56
Gross Profit/(Loss) 285.15 108.80
Interest 67.20 445.22

Depreciation 167.85 164.44
Preliminary Expenses 5.12 4.12
Net Profit / (Loss) 44.98 (504.98)
:
Excess Provision written back (Interest on IF CI Loans) 782.34 23.06
Profit / Loss Carried forward 827.32 (481.92)
Accumulated Loss 527.94 1355.26
FINANCE:
Although the Company was earning profits on its operations, due to heavy interest burden the working
results ended with net losses. In order to reduce the interest burden and improve the working results, the
Company negotiated with IFCI Ltd., for a One-Time Settlement of their loans and waiver of interest, past
7
and future. After several discussions IFCi Ltd., and the Company have reached an understanding in the
matter. Accordingly a One-Time Settlement agreement has been arrived at as under
1. Total quantum of the loan (including Foreign Currency Loan) has been pegged at Rs.2,584.50 Lacs,
of which 25% ( Rs.646.13 Lacs.) should be paid before 31 &! March,2001 and the balance 75%
aggregating Rs. 1938.37 Lacs, repaid in 10 equal quarterly instalments i ;nterest-free) commencing
from 15'h July ,2001.
2. IFCI Ltd., have agreed to waive all interest obligations.
To meet the financial requirements for down payment and first instalment to IFCI the Company has accepted
as Share Application money aggregating Rs.754.75 Lacs from SKM Animal Feeds and Foods (India) Limited
and other promoters. Out of this, Rs.736.75 Lacs will be converted into Equity Shares after necessary
approval of the Shareholders at the AGM.
The Shareholders may piease note that the down payment of Rs.646.13 Lacs, has been completed on
22 nd March l 2001.
DIRECTORS :
Dr. M. Chandrasekar and Shri. S.M. Venkatachalapathy Directors, retire by rotation at this Annual Genera!
Meeting and are eligible for re-appointment.
The Directors have re-appointed Shri. SKM, Maeilanandhan as Managing Director and Shri. S.K.M. Shree
Shivkumar as Executive Director for a period of five years from 26th June 2001, subject to approval of
shareholders at the ensuing AGM.
Directors Responsibility Statement:
The Directors hereby confirm :

(i) That in the preparation of the annual accounts, the applicable accounting standards had been followed
along with proper explanation relating to material departures,
(it) That the directors had selected such accounting policies and applied them consistently and made
judgments and estimates that are reasonable and prudent so as to give a true and fair view of the
state of affairs of the company at the end of the financial year and of the profit or loss of the
company forthat period.
(iii) That the directors had taken proper and sufficient care for the maintenance of adequate accounting
records in accordance with the provisions of this Act for safeguarding the assets of the company
and for preventing and detecting fraud and other irregularities.
(iv) That the directors had prepared the annual accounts on a going concern basis.
CORPORATE GOVERNANCE;
As per listing agreements, compliance with the requirements of Corporate Governance is applicable to your
Company by 31 s! March.2002. The Company has constituted various Committees under this requirement,
as detailed hereunder:
a. Audit Committee :
The Audit Committee was constituted on 28rh February 1997. It consists of 4 Directors
Shri. M. Chinnayan (Chairman of the Committee), Shri.P. Kumarasamy, Shri. P. Shanmugasundaram
and Smt. Sarada N. Menon as members.
b. Share Transfer Committee :

The Share Transfer Committee was constituted on 28th February 1997 consisting of 3 Directors -
Shri S.M. Venkatachalapathy (Chairman of the Committee), Shri. S.K.M. Shree Shivkumar and
Dr. M. Chandrasekar as members.
c. Shareholders Grievances Committee :

Shareholders Grievances Committee was constituted on 25th April 2001 with Shri. RKumarasamy,
Shri. S.M. Venkatachalapathy, Dr. L.M. Ramakrishnan, and Shri. M. Chinnayan as members,
Dematerialisation of the Company's Shares :

As per the directive of SEBI, the company has entered into agreements with NSDL and CDSL for security
holding and settlement of trading of securities in the electronic form. The shareholders of the company have
the option to dematerialize and to convert their scripts into electronic holding by opening an account with
any one of the Depositary Participants. The Company has appointed M/s. Integrated Enterprises (India)
Limited, 2 nd Floor, 'Kences Towers', No.1, Ramakrishna Street, North Usman Road, T.Nagar,
Chennai-600 017 as Share Transfer Registrar for electronic mode.
AUDITORS
M/s. N.C.Rajagopal & Co., Chartered Accountants, Erode retire at the ensuing Annual General Meeting and
are eligible for re-appointment. Necessary certificate as required under section 224 of the Companies Act,
1956 has been received from them.
CONSERVATION OF ENERGYJECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE

EARNINGS/OUTGO :
Particulars are given in the Annexure to this report.
PARTICULARS OF EMPLOYEES DRAWING RS. 12,00,000/- OR MORE PER ANNUM :

NIL
ACKNOWLEDGEMENT
The Directors wish to express their sincere thanks to IFCI Ltd., fortheir gesture in waiving past and agreeing
not to charge interest on future instalments v/ith a view to provide an opportunity to the Company to stabilise
itself.
The Directors also wish to place on record their sincere thanks to State Bank of India, for providing working
capital needs.
The Directors also wish to express their heartfelt thanks to the promoter Company M/s. SKM ANIMAL
FEEDS AND FOODS (INDIA) LIMITED for iheir extensive financial support and infusion of funds to enable
the company to meet its obligations under One-Time Settlement agreement with IFCI Ltd, which will go a
long way in the growth of the Company.
The Directors also wish to place on record their appreciation of the valuable and dedicated services rendered
by the employees at all levels that has contributed to the good performance of the company.
By order of the Board of Directors
Place : Erode. SKM. MAEILANANDHAN

Date : 31.07.2001 CHAIRMAN & MANAGING DIRECTOR
ANNEXURE
FORM OF DISCLOSURES OF PARTICULARS WITH RESPECT TO CONSERVATION OF ENERGY
(A) POWER AND FUEL CONSUMPTION 2000-2001 1999-2000

(1) Electricity
a. Purchased units (Kwh) 10,85,432 8.11,240
Total Amount (Rs.) 44,88,910 31,97.532
Rate/unit (Rs.) 4.14 3.94
b. Own. Generation
i. Through Diesel Generator Units (Kwh) 24.70.851 14,82,642
Total Amount 1,07,21,898 55,94.324
Units per litre of Diese! Oil 2,96 2.67
Cost/Unit {Rs.) .34 3.77
ii. Through Steam Turbine/Generator
Units
Units per litre of Fuel Oil/Gas NA NA
Cost/Unit
(2) Coal (Specify quality and where used)

Quantity (Tonnes) NA NA
Total Cost (Rs.)
Average rate (Rs.)
(3) Furnace Oil
Quantity (Litres) 20,23.132 5,69,829
Total Cost (Rs.) 1,08,63,946 44,76.368
Average rate (Rs.) 5.37 7.85
(B) CONSUMPTION PER UNIT PRODUCTION

Product - Egg Powder (M. Tons) 2080 763
Electricity (Rs. Per Ton) 7.312 11,318
Furnace Oil (Rs. Per Ton) 5 f 223 5,867
Coal NA NA
Others NA NA
(C) TECHNOLOGY ABSORPTION:
The Company's personnel have been trained by the collaborators/machinery suppliers in the
operation and maintenance of the plant and machinery and process techniques.
(D) FOREIGN EXCHANGE EARNINGS AND OUTGO ;

Earnings : Rs. 2,621.00 Lacs.
Outgo : Rs. 140.29 Lacs.
10
AUDITORS' REPORT
To the Shareholders of SKM Egg Products Export (India) Limited
We have audited the attached Balance Sheet of M/s. SKM Egg Products Export (India) Limited,
180, Gandhiji Road, Erode - 638 001, as at 31st March, 2001 and the Profit & Loss Account for the
year ended 31 st March,2001 together with the notes thereon and report that:
1. As required by the Manufacturing and other Companies (Auditor's Report) Order 1988,
issued by the Company Law Board in terms of Section 227(4A) of the Companies Act, 1956,
we enclose in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the
said order.
2. Further to our comments in the Annexure referred to in paragraph (1) above, we state that:
(a) 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.
(b) In our opinion, proper books of accounts as required by Law have been kept by the Com-
pany so far as appears from our examination of those books of accounts.
(c) The Balance Sheet and Profit and Loss Account referred to in this report are in agreement
with the books of accounts.
(d) In our opinion, the Profit and Loss account and Balance Sheet comply with the accounting
standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956.
(e) On the basis of the written confirmation received from the directors as on 31 st March, 2001,
and taken on record by the Board of Directors on 25th April 2001, we report that none of the
directors is disqualified as on 31st March, 2001, from being appointed as a director in terms
of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956.
(e) in our opinion and to the best of our information and explanations given to us, the said
Balance Sheet and Profit and Loss Account, read together with the notes thereon give the
information required by the Corrpanies Act, 1956, in the manner so required and give a true
and fair view:-
(i) In so far as it relates to the Balance Sheet, of the State of Affairs of the Company as at
31st March, 2001.
(ii) In so far as it relates to the Profit and Loss A/c, of the Profit for the year ended
31stMarch2001.
for N.C.Rajagopal & Co.,

Chartered Accountants
Place : Erode (N.C.Sampath)

Date : 25.04.2001 Partner
11
ANNEXURE REFERRED TO IN PARAGRAPHd)

OF OUR REPORT OF EVEN DATE:
1. The Company has maintained proper records showing quantitative details and location of Fixed
Assets. All the assets have been physically verified by the management and on verification no
discrepancies were noticed. In our opinion the frequency of verification is reasonable.
2. None of the Fixed Assets have been revalued during the year.
3. The Stocks of finished goods, stores, spare parts and raw materials, excluding materials in
transit have been physically verified during the period by the management. In our opinion, the
frequency of verification is reasonable.
4. In our opinion and according to the information and explanations given to us, the procedures of
physical verification of stock followed by the management are reasonable and adequate in relation
to the size of the company and the nature of its business.
5. The discrepancies on physical verification of the stocks as compared to book records are not
material and have been properly deait with in the books of accounts
6. In our opinion, on the basis of our examination of the stock records and according to the
information and explanations given to us, the valuation of stocks is fair and proper and is in
accordance with the normally accepted accounting principles.
7. The Company has not taken any loans, secured or unsecured from companies, firms or other
parties listed in the registers maintained in accordance with Section 301 of the Companies Act.
1956.
8. The Company has not granted any loans secured or unsecured to companies, firms, or other
parties listed in the Registers maintained in accordance with Sections 301 and 372A(5) of the
Companies Act 1 956.
9. The Company has not given any loans or advances in the nature of loans during the year.
10. In our opinion and according to the information and explanations given us. there are adequate
internal control procedures commensurate with the size of the Company and the nature of its
business with regard to purchase of stores, raw materials including components. Piant &
Machinery, equipment and other Assets and with regard to saie of aoods.
11. In our opinion, according to information and explanations given to us during the course of our
audit, on the transactions of purchase of goods and materials made m pursuance of contracts or
arrangements entered in the Register maintained under Section 301 o' the Companies Act. 1 956
and aggregating to Rs.50,000/- or more in respect of each party, the prices paid are reasonable-
having regard to prevailing market prices for similar goods or materials.
12. The Company has a regular procedure for determination of unserviceable or damaged stores
and raw materials and adequate provision has been made in the accounts for the loss arising on
the items so determined.
12
13. The Company has not accepted deposits from the public within the meaning of Section 58-A of
the Companies Act, 1956 and the rules made thereunder.
14. In our opinion, reasonable records have been maintained by the Company for the sale and disposal
of waste and scraps. There is no by-Products in the process.
15. In our opinion adequate Internal Audit system exists commensurate with the size and nature of
the business.
16. Since the Central Government has not directed the Company to maintain Cost records the need
to maintain costs records under Section 209(1 )(d) of the Companies Act, 1956 does not arise.
17. Provident fund dues have been regularly deposited with the appropriate authorities. Employees
State Insurance Act does not apply to the Company.
18. According to the information and explanations given to us, no undisputed amount payable in
respect of Income Tax, Wealth Tax, Sales Tax, Custom and Excise duty were outstanding, as at
31 st March 2001, for a period of more than 6 months from the date they became payable.
19. According to the information and explanations given to us, no personal expenses of employees
or directors have been charged to revenue account, other than those payable under contractual
obligations or in accordance with generally accepted business practice.
20. The Company is not a sick industrial company within the meaning of clause (O) of sub-section
(1) of Section 3 of the Sick Industrial Companies (Special Provisions) Act, 1985.
for N.C.Rajagopal & Co.,

Place : Erode
(N.C.Sampath)
13
BALANCE SHEET AS AT 31st MARCH, 2001

Amt. in Rs.
Particulars Schedule As at 31.03,2001 As at 31.03.2000
SOURCE^FFUNDS
Share Capital A 184,625,000 184,625.000
Reserves & Surplus 400,692 400,692
Share application money 65,000.000
Secured Loans C 313.829.610 345.751,979
Unsecured Loans D 10.544.540 9.551,500
474,399,842 540,329,171
APPLICATION OF FUNDS
Fixed Assets
Gross Block 442.387.809 430.198,041
Less : Depreciation 58,798,942 42,013,547
Net Block 383.588,86"; 388,184.494
Current Assets, Loans
and Advances
Inventories F 94,539,621 27.353.753
:
Sundry Debtors G 4,657,164 1,442,362
Cash & Bank Balances H 5.,131,376 4,046,668
Loans & Advances I 3,834,893 3,515,379
108.163,054 36,358,162
Less : Current Liabilities
and Provisions J 73.018,920 22,623,281
Net Current Assets 35,144,134 13.734,881
Miscellaneous Expenses K 2,872,219 2.884,256
(to the extent not written off/adjusted
Debit Balance of P&L A/c 52,794,622 135,525,540
474,399,842 540,329,171
Notes on Accounts S
As per our report of even date. r:nr and on Behalf of the Board
For N.C.Rajagopal & Co., SKM. MAEILANANDHAN S.K.M. SHREE SHIVKUMAR

Chartered Accountants Chairman & Managing Director Executive Director
N.C. SAMPATH G.N.VARADARAJAN R. MURALIDHARAN

Partner Company Secretary General Manager - Finance
Place : Erode
Date : 25.04.2001
14
PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31st MARCH, 2001
Amt. in Rs.
Year Ended Year Ended

Particulars Schedule
31.03.2001 31.03.2000
INCOME L
Sales 273,200,123 114,804,221
Other Income 1,793,107 931,996
Total 274,993,230 115,736,217
EXPENDITURE
Manufacturing Expenses M 263,024,922 77,694,304
Employees' Cost N 10,143,705 8,329,872
Other Expenses O 24,350,408 15,734,776
Sales Commission to Foreign Collaborator & Others 8,145,885 2,974,711
Marketing Expenses P 818,738 2,041,639
Sub Total 306,483,658 106,775,302
(Increase)/Decrease in Stock Q (60,005,357) (1,919,015)
Total Cost 246,478,301 104,856,287
Profit (Loss) Before Interest & Depreciation 28,514,929 10,879,930

Interest & Financial Charges R 6,720,609 44,521,876
Profit (Loss) After Interest 21,794,320 (33,641,946)
Depreciation 16,785,395 16,443,603

Preliminary Expenses - Written off During the Year 512,036 412,036
Profit (Loss) after Interest & Depreciation 4,496,889 (50,497,585)
Balance in Profit & Loss a/c brought forward (135,525,540) (87,333,932)
(131,028,651) (137,831,517)
Less : IFCI Interest written back - under OT S 78,234,029 2,305,977
Balance Carried to Balance Sheet (52,794,622) (135,525,540)
Notes on Accounts S
As per our report of even date. For and on Behalf of the Board

N.C.SAMPATH G.N.VARADARAJAN R.MURALIDHARAN

Partner Company Secretary General Manager- Finance
Place : Erode
Date : 25.04.2001
15
SCHEDULES FORMING PART OF THE BALANCE SHEET

Arnt. in Rs.
As at 31.03.2001 As at 31.03.2000
SCHEDULE - A - Share Capital

Authorised Capital:
3,00,00,000 (Previous year 2,00,00,000) Equity Shares of
Rs. 10/-each 300,000.000 200.000,
Issued, Subscribed & Paid-up :
1,84,62,500 (Previous year - 1,84,62,500) Equity Shares of
Rs.107- each fully paid-up 184,625,000 184.625.000
184,625.000 184,625,000
SCHEDULE - B - Reserves & Surplus
Share Premium Account
As per last Balance Sheet 400,692 400,692
400,692 400,692
SCHEDULE - C - SECURED LOANS *
i) From IFCI Limited
Rupee Term Loan 193,329.692 80,357,566
Foreign Currency Loan 167,541,440
Interest Accrued and Funded 78.234,029
ii) From Banks
Working Capital Finance
From SBI Commercial Branch. Erode 19,999,918 19,618.944 !
213,829,610 345.751.979
RUPEE TERM LOAN & FOREIGN CURRENCY LOAN
* a First charge over all the movable properties of the Company including imported and indigenous Plant and Machinery
both present and future and mortgage by deposit of the title deeds of all the immovable properties situated at
Punjaikilambadi Village.
b. Personal guarantee of Chairman & Managing Director and Corporate guarantee of M/s. SKM Animal Feeds and
Foods (India) Limited.
Working Capital Finance
a. Hypothecation of raw materials, stock-in-process, finished goods and consumable stores,
bt Second charge on the entire fixed assets financed by IFCI (First charge with IFCI).
c. Personal guarantee of Chairman & Managing Director and Corporate guarantee of
M/s. SKM Animal Feeds and Foods (India) Limited.
SCHEDULE-D
As at 31.03.2001 As at 31.03.2000
UNSECURED LOANS:
Soft Loan from M/s. TIDCO 9.551,500 | 9.551,500
Interest accrued
a. Based on tripartite agreement with M/s. TIDCO and Ministry of Food Processing.
b. Personal Guarantee of Chairman & Managing Director and Corporate guarantee of Ms. SKM Animal Feeds
and Foods (India) Limited.
16
SCHEDULE E - FIXED ASSETS

Amt. in Rs.
Gross Block Depreciation Net Block

Adjustments; Depreciation Adjust Total
Description As at Additions As on Depre- As at As at
Deductions for the year ments/ Depreciation
During the ciation
31.03.2000 During the 31.03.2001 ended Deductions as on 31.03.2001 31.03.2000
Year as on
Year 31.03.2001 During the 31.03.2001
31.03.2000
Year
Land & Site Development 13,104,786 13,104,786 13,104,786 13,104,786
!
Building 70,858,791 984,125 71,842,916 5,598,537 2,156,136 7,754,673 64,088,243 65,260,254
I
Plant & Machinery 332,903,433 10,831,100 343,734,533 33,774,966 13,624,124 47,399,088 296,335,445 299,128,467
I
Office & Other Equipments 7,946,861 188,143 8,135,004 1,239,545 479,311 1,718,859 6,416,145 6,707,316
I
Computers 1,338,423 61,400 1,399,823 665,797 219,706 875,502 524,321 682,626
'
I
Furniture & Fixtures 3,325,227 3,325,227 511,206 210,487 721,693 2,603,534 2,814,021
I
Motor Vehicles 720,520 125,000 845,520 233,496 95,631 329,127 516,393 487,024
I
430,198,041 12,189,768 - 442,387,809 42,013,547 16,785,395 - 58,798,942 383,588,867 388,184,494
Notes:
1. Additions include of Rs. 1,05,43,686/= towards adjustments in respect of foreign exchange difference on the loan from IFCI Ltd., for import of machineries.
17
Amt. in Rs.
As at 31.03.2001 As at 31.03.2000
CURRENT ASSETS, LOANS AND ADVANCES

Schedule F - Inventories
(As Valued & Certified by the Management)
Raw Material 2,632,986 508,970
Additives, stores, spares and consumables 8,050,955 2,994,460
Finished Goods 81,071,689 22,746,078
Work in process 2,783,991 1,104.245
94,539,621 27,353,753
Schedule G - Sundry Debtors
Unsecured & Considered Good
Sundry Debtors - Considered Good
a. More Than Six Months -
b. Others 4,657,164 1,442,362
4,657.164 1,442,362
Schedule H - Cash and Bank Balances
i. Cash on hand 93,339 51,531
ii. In Current Accounts with Scheduled Banks 790,127 187,874
iii. Fixed deposit with SBI, ERODE 4,247,910 3,807,263
5,131,376 4,046,668
Schedule 1 - Loans and Advances
i. Advances recoverable in Cash or in kind
for value to be received - unsecured and
considered good 3,045,242 1,415,756
ii. Deposits-considered good 789,651 1,031,490
iv. Pre-paid Insurance - 1,068,133
3,834,893 3,515,379
Schedule J - Current Liabilities and Provisions
i. Trade Creditors* 64,776,835 18,788,782
ii. Creditors for Expenses & Others 8,242,085 3.834,499
iii. Creditors for Capital Liability - -
73,018,920 22,623,281
i. Due to Small Scale Industries

M/s. SKM Animat Feeds & Foods (India) Limited, Erode | 63,692,962 18,729,689
ii. Due to others other than Small Scale Industries 1,083,873 59,093
Schedule K - Miscellaneous Expenditure

Preliminary Expenses 431,844 493,536
Public Issue Expenses 2,452,411 2,802,756
Registration fee for increase share capital 500,000 -
3,384,255 3,296,292
Less: Written off during the year 512,036 412,036
2,872,219 2,884,256
18
SCHEDULES FORMING PART OF PROFIT AND LOSS ACCOUNT

Amt. in Rs.

31.03.2001 31.03.2000
SCHEDULE - L - SALES & OTHER INCOME

Export sales 270,555,060 113,493,121
Domestic sales 2,645,063 1,311,100
Total 273,200,123 114,804,221
Sale of shell eggs and scrap 1,408,370 598,247

Interest received & accrued (TDS Rs. 81,971) 384,737 315,416
Profit on sale of assets (lorry) - 18,333
OTHER INCOME 1,793,107 931,996
SCHEDULE - M - MANUFACTURING EXPENSES

Raw material - Eggs Consumed 223,449,588 60,307,709
Packing Material - Consumed 5,670,761 2,338,230
Power & Fuel 26,074,754 13,268,223
Procurement Expenses 214,774 254,862
Additives & Consumables 7,615,045 1,525,280
263,024,922 77,694,304
SCHEDULE - N - EMPLOYEES' COST

Salaries & Wages 6,980,603 6,600,232
PF Contribution 489,870 415,335
Contractors' Payment 2,067,456 787,313
9,537,929 7,802,880
Welfare Expenses 605,776 526,992
10,143,705 8,329,872
19
Amt. in Rs.

31.03.2001 31.03.2000
SCHEDULE - 0 - OTHER EXPENSES

Repairs & Maintenance
a. Building 234,327 455,573
b. Plant & Machinery 469,293 452,986
c. Others 524,920 548,110
d. Vehicle (Car, Van & Two wheelers) 627,343 555,414
a Lorry 370,101 254,158
2,225,984 2,266,241
Stores & Spares - consumed 3,464,893 2,399,938

Analysing Charges 164,199 605,384
Rent, Rates and Taxes 374,808 267,747
Postage, Courier & Telephone Charges 874,811 741,335
Printing and Stationery 320,905 208,769
Insurance Premium 1,037,491 1,074,528
Advertisement and Publicity 116,647 73,339
Travelling Expenses 619,276 473,631
Freight, Insurance and Forwarding Charges 13,792,959 6,740,502
Professional Charges 681,470 10,000
ISO/HACCP-Expenses 162,178 187,041
Miscellaneous Expenses 453.887 628,046
Audit fees : Statutory 39,900
Concurrent 21,000 60,900 58,275
22,124,424 13,468,535
24,350,408 15,734,776
SCHEDULE - P - MARKETING EXPENSES

ED Foreign Trip Expenses (in Foreign Currency) 245,340 182,385
ED Foreign Trip Expenses (in Indian Rupee) 294,883 452,995
Exhibition - Foreign Expenses 31,304 262,520
Sample Courier Charges 203,092 281,913
Foreign Delegates Expenses 44,119 861,826
818,738 2,041,639
SCHEDULE - Q - (INCREASE) / DECREASE IN STOCK

Opening Stock - Finished Goods 22,746,078 21,832,308
Rework Powder 1,104,245 99,000
Closing Stock - Finished Goods 81,071,689 22,746,078
Rework Powder 2,783,991 1,104,245
(60,005,357) (1,919,015)
20
Amt. in Rs.

31.03.2001 31.03.2000
SCHEDULE - Ft - INTEREST & FINANCIAL CHARGES
Foreign Currency Loan 19,720,353
Rupee Loan 19,786,849
Working Capital Loan Interest 1,858,525 2,028,447
Bank Charges & ECGC Charges 766,502 680,924
Export bills discount interest 2,333,,580 2,026,103
Export bills-overdue interest 150,879 279,200
Interest - short term loan - animal feeds 618,083
Interest to Tidco soft loan 993,040
6,720,609 44,521,876
SCHEDULE-S - NOTES ON ACCOUNTS

1. Previous year's figures are regrouped/reclassified wherever necessary and figures have been rounded
off to nearest Rupee.
2. As a 100% EOU, the Company is exempted from payment of customs duty and excise duty.
Therefore, the above duties have not been included in the value of inventories, as set out in the
revised AS-2 issued by the Institute of Chartered Accountants of India.
3. a. Preliminary expenses and public issue expenses are written off over a period of ten years.
b. Registration fee of Rs. 5,00,000/- to the Registrar of Companies on account of increase in the
Authorised Share Capital has been provided for and will be written off in five equal instalments
commencing from this year.
4. Contingent Liability :
a.Export Bills discounted with the State Bank of India, Commercial Branch, Erode
Rs. 361.69 Lacs (Previous year Rs. 303.45 Lacs)
5. Sundry creditors/debtors balances are subject to confirmation.
6. The Company and IFCI Ltd have entered into a One-Time Settlement agreement vide IFCI letter
Nos.Chero/Pr.4518/20000-1918 dt.5/12/2000 and Chero/Pr.4518/2001 -2773 dt.20/03/2001 on the
following terms.
a. The quantum of loan (including Foreign Currency loan) pegged at Rs.25,84,42,692/-.
b. 25% of the above sum (Rs.6,46,13,000/-) should be paid as down payment by 31 st March 2001
and the balance 75% in ten equal quarterly instalments of Rs.1,93,83,700/- each, the first
instalment falling due on 15th July 2001.
c. All interest (past and future) will be waived by IFCI Ltd until repayment of the balance loan in
instalments as above.
d. In the event of default by the Company in payment of the One-Time Settlement instalments, the
same shall carry interest at the existing rates.
e.The IFCI has also reserved for itself the right to revoke all the reliefs and concessions in the
event of the company defaulting or breaching any terms of the OTS.
21
Based on the above understanding the down payment of Rs. 6,46,13,000/- was completed on 22nd
March 2001. Provision for the unpaid and accrued interest of Rs.7,82,34,029/- as on 31 st March
2000 has been withdrawn and no interest on IFCI loans has been charged in the accounts for the
year 2000 -2001.
7. Additional information pursuant to the provisions of paragraph (4D) of Part- II of Schedule VI to

Companies Act, 1956:
(I) Details of licensed capacity, installed capacity.

a. Licensed capacity Not applicable.
b. Installed capacity 3500 MTs per annum.
(II) Quantitative particulars of Sales: (in MTs)
2000-2001 1999-2000
Egg powder sales 1,840 795
(HI) Stock & Production (in MTS)
a. Opening stock 194 226
b. Production 2080 763
c. Closing stock 434 194
d. Work-in-process (liquid egg) 25 12.5
(IV) Consumption of raw materials. 2000-2001 1999-2000
a. Egg (Nos. in lakhs) 1,859.55 667.69
(V) Consumption of imported & indigenous materials
2000-2001 1999-2000
Particulars % %
Rs. in lacs Rs. in lacs
Raw material
Indigenous 2,234.50 100.00 603.08 100
Imported - Nil Nil Nil
Packinq Material
Indigenous 32.11 56 13.62 58
Imported 25.40 44 9.76 42
Consumable. Stores and spares
Indigenous 58.73 53 27.34 70
Imported 52.68 47 11.97 30
Furnace Oil
Indigenous 68.23 63 44.76 100
Imported 40.41 37 - -
22
(VI) Expenditure in Foreign currency: (Rs. in lacs)

Particulars 2000-2001 1999-2000
A. Packing Material & Additives 92.78 Nil
B. Foreign Travel Expenses 2.45 1.82
C. Exhibition expenses (Foreign) 0.31 2.63
D. Technical know-how Fee - 14.47
E. Sales Commission 33.44 23.76
R Others 11.31 11.29
(VII) FOB value of goods exported 2,621.00 1,097.69
8. Remuneration to Directors: (in Rs) 2000-2001 1999-2000
Executive Director 6,38,510 4,97,480
(i) The Managing Director is not drawing any remuneration from the company.
(ii) The Executive Director's remuneration is covered under Part II of Schedule XIII of the Companies Act,
1956, as there is insufficiency of profit. Hence, computation of managerial remuneration u/s 349 of the
said Act is not furnished.
9. Details of Fee to Auditors : (in Rs.) 2000-2001 1999-2000
(i) Statutory Audit Fee 25,000 25,000
(ii) For taxation matter 10,000 5,000
(iii) Fee for Certification 3,300 5,500
10. Significant Accounting Policies :
a. Basis of Accounting :
The financial statements are prepared under historical cost convention and are based on accrual basis of
accounting.
b Fixed Assets:
Fixed Assets are stated at cost less depreciation.
c. Depreciation:
Depreciation is charged on straight line method as per rates provided in Schedule XIV of Companies Act
1956, except for imported plant & machinery for which the rate has been taken as 3.80%, based upon the
technical evaluation by the expert committee on the useful life of the assets. In respect of assets added/
adjusted during the year, depreciation is; provided on Pro-rata basis.
d. Inventories:
Inventories are valued in line with the mandatory Accounting Standards - 2 (Revised) issued by the
Institute of Chartered Accountants of India, as follows:
1. Raw materials : At cost following FIFO method.
2. Packing materials At weighted average cost.
3. Additives At weighted average cost.
4. Stores & spares
Imported At weighted average cost.
Indigenous At weighted average cost.
5. Work-in-progress At estimated cost.
6. Finished goods : At cost or net realisable value whichever is less.
23
e. Foreign Currency Transactions:

Foreign Currency liability in connection with the loans taken for acquisition of the fixed assets has been
frozen on 6th December 2000 vide the letter of IFCI dated 6th December 2000. Hence the foreign
currency loan has been revalued based on rate prevailing on the date of freezing and the difference has
been adjusted to the cost of fixed assets.
f- Retirement benefits:
Provision for statutory liability as on 31 st March 2001 has been made in the books of accounts. Contribution
to provident fund is being paid within the stipulated period as provided under the Provident Fund Act.
Gratuity has been provided in the accounts in respect of employees eligible therefor and the liability will
be discharged as and when it arises.
9- Treatment of Interest on Borrowings:

Interest on Borrowings used for capital expenditure has been capitalised for the period upto the date on
which the asset is ready to be put to use. Expenditure on such loans for subsequent periods and all
interest on other borrowings are treated as a revenue expenditure.
h. Government Subsidy:
Government Subsidy relating to Sales tax is accounted for where it is reasonably certain that the ultimate
collection will be made and on accrual basis, and is shown by way of deduction from the related expenses.
i. Revenue Recognition:
Revenue is recognised on accrual basis.
As per our report of even date For and on behalf of the Board

N.C.SAMPATH G.N.VARADARAJAN R. MURALIDHARAN

Partner Company Secretary General Manager- Finance
Place: Erode
Date : 25.04.2001
24
Additional Information as per part IV, Schedule VI to the Companies Act, 1956.
BALANCE SHEET ABSTRACT AND COMPANY'S GENERAL BUSINESS PROFILE
I. Registration Details
Registration No. 181-6025
State Code No. 18
Balance Sheet Date 31.03.2001
II. Capital Raised during the year (Rs. in Thousand)
Public Issue Nil
Rights Issue Nil
Bonus Issue Nil
Private Placement Nil
in. Position of Mobilisation and Deployment of Funds
(Rs. in Thousand)
Total Liabilities 547417
Total Assets 547417
Sources of Funds
Paidup Capital 184625
Reserves and Surplus 401
Share application money 65000
Secured Loans 213829
Unsecured Loans 83562
Application of Funds
Net Fixed Assets 383588
Investments Nil
Current Assets 108163
Misc. Expenditure (not written off) 2872
Accumulated Loss 52794
IV. Performance of the Company (Amount in Rs.Thousands)
Turnover 274993
Total Expenditure 270496
Profit Before Tax 4497
Profit After Tax 4497
Earnings per Share -
Dividend Rate % Nil
V. Generic names of three Principal Products/Services of the Company
Item Code No. 4081100
Product Description EGG POWDER
SKM. MAEILANANDHAN S.K.M. SHREE SHIVKUMAR

Chairman & Managing Director Executive Director
Place Erode G.N.VARADARAJAN R.MURALIDHARAN

Date 25.04.2001 Company Secretary General Manager- Finance
25
CASH FLOW STATEMENT FOR THE YEAR ENDED 31st MARCH, 2001
Rs. in Lacs
As at 31.03.2001 As at 31 .03.2000
A. CASH FLOW FROM OPERATING ACTIVITES

(INDIRECT METHOD)
Increase in P & L A/c 44.97 (481.92)
Increase inGeneral Reserve „ -
Provision for Dividend -- „
Provision for Tax --
Profit Before Tax 44.97 (481.92)

Add: Depreciation 167.85 164.43
Decrease in Debtors (32.15) (14.33)
Increase in Trade Creditors 459.88 (35.86)
Increase in Expn. Crs. 39.08 26.75
Interest (Adj) 9.93 372.01
Preliminary Expenses written off 5.12 4.12
Profit on Sale of Fixed Asset - • (0.18)
649.71 516.94
694.68 35.02
Add : Inventories (adj) 671.86 (0.89)
Net operating cash flows 22.82 34.13
B. CASH FLOW FROM INVESTING ACTIVITES
Purchase of fixed assets (16.46) (29.82)
Sale of fixed assets 4.28
Purchase of Investments -. --
Sale of investments -- --
Interest received -- --
Dividend received ...
Profit on sale of fixed assets -- 0,18
Net Cash used in investing Activities (16.46) (25.36)
C, CASH FLOW FROM FINANCING ACTIVITES
Proceeds from issue of Share Capital (Application Money) 650.00
Increase (Decrease) in long term borrowings (646.13) (3.86)
Increased Decrease) in other borrowings 3.81 --
Divident paid/Accured Interest paid - ,-
(Decrease)/lncrease in Loans and Advances (3.20) 4.68
Net Cash (used in) received from
financing activities 4.48 0.82
Net increase/(Decrease) in cash and cash equivalents 10.84 9.59
Operating Cash and Cash equivalents 40.47 30.88
Closing Cash and Cash equivalents 51.31 40.47
SKM.MAEILANANDMAN S.K.M. SHREE SHIVKUMAR G.N.Varadarajan R. Muralidharan

Chairman & Managing Director Executive Director Company Secretary General Manager-Finance
Place : Erode
Date : 25.04.2001
AUDITORS' CERTIFICATE
We have examined the Cash Flow Statement of SKM Egg Products Export (India) Limited for the year ended 31st March 2001. The
statement has been prepared by the Company in accordance with the requirements of Clause 32 of the Listing Agreement with the Stock
Exchanges and is based on and is *n agreement with the corresponding Profit and Loss Account and Balance Sheet of the Company
covered by our report dated 25.04.2001 to the Members of the Company.
For N.C.Rajagopal & Co.,
Place : Erode
N.C.SAMPATH
26
Registered Office : 180, Gandhiji Road, Erode - 638 001
ATTENDANCE SLIP
Regd. Folio No.:
Sixth Annual General Meeting on Thursday, the 27th September, 2001 at

4.00 p.m. at Kongu Kalaiarangam, E.V.K.Sampath Nagar, Erode - 638 011.
I hereby record my presence at the 6th ANNUAL GENERAL MEETING of the Company
held at Kongu Kalaiarangam, E.V.K.Sampath Nagar, Erode - 638 011 on Thursday,
the 27th September, 2001 at 4,00 p.m.
I am a shareholder of the Company*

I am a Proxy/Authorised Representative of the shareholder(s)*
My name is
* Please strike off any one which is not applicable
Signature
Request to Members:
1. Shareholders and proxies should bring the attendance slip duly filled-in for attending
the Meeting and hand it over at the entrance of the Meeting Hall.
2. Members are requested to avoid being accompanied by non-members and/or children.

Registered Office : 180, Gandhiji Road, Erode - 638 001
PROXY
Regd. Folio No.: No. of Shares Held: ,.
I/We of
in the district of
being a member/members of SKM EGG PRODUCTS EXPORT (INDIA) LIMITED, hereby appoint
of in the district
of or failing him of
in the district of as my/our Proxy to
vote for me/us on my/our behalf at the 6th Annual General Meeting of the Company to be held
on the 27th September, 2001 at 4.00 p.m. and at any adjournment thereof.
Affix
Signature One Rupee

Signed this day of .2001 Revenue
Stamp
Note: The Proxy must be deposited at the Registered Office of the Company not less than
48 hours before the time for holding the Meeting.

SKM Egg Products Exp India Ltd-532143-March-2001

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SKM EGG PRODUCTS EXPORT

SIXTH ANNUAL REPORT

EXCELLENCE - OUR GOAL

SERVICE - OUR MOTTO

QUALITY - OUR OBSESSION

Transforming the Egg into a symbol of Indian Excellence abroad

BOARD OF DIRECTORS Shri. SKM. MAEILANANDHAN

COMPANY SECRETARY Shri.G.N.VARADARAJAN BCom, F.C.S.,

AUDITORS N.C.RAJAGOPAL & CO.,

BANKERS STATE BANK OF INDIA

REGISTERED OFFICE 180, Gandhiji Road,

FACTORY Erode to Karur Main Road,

SKM EGG PRODUCTS EXPORT (INDIA) LIMITED

2. Appointment of Director in the place of a retiring Director:

3. Appointment of Director in the place of a retiring Director:

4. Appointment of Auditors and fixing of their remuneration :

1. Salary : Rs. 45,000/- per month in the scale of Rs.45,000-5,000-65,000/-.

By Order of the Board of Directors

Place : Erode G.N.VARADARAJAN

EXPLANATORY STATEMENT UNDER SEC. 173(2)

1. SKM Animal Feeds and Foods (India) Ltd.

TOTAL 754.75 736.75

Particulars 2000-2001 1999-2000

Total Income 2749.93 1157.36

Total Expenditure 2464.78 1048.56

Gross Profit/(Loss) 285.15 108.80

Interest 67.20 445.22

Accumulated Loss 527.94 1355.26

Directors Responsibility Statement:

The Directors hereby confirm :

b. Share Transfer Committee :

c. Shareholders Grievances Committee :

Dematerialisation of the Company's Shares :

CONSERVATION OF ENERGYJECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE

PARTICULARS OF EMPLOYEES DRAWING RS. 12,00,000/- OR MORE PER ANNUM :

By order of the Board of Directors

Place : Erode. SKM. MAEILANANDHAN

(A) POWER AND FUEL CONSUMPTION 2000-2001 1999-2000

(2) Coal (Specify quality and where used)

(B) CONSUMPTION PER UNIT PRODUCTION

(D) FOREIGN EXCHANGE EARNINGS AND OUTGO ;

To the Shareholders of SKM Egg Products Export (India) Limited

for N.C.Rajagopal & Co.,

Place : Erode (N.C.Sampath)

ANNEXURE REFERRED TO IN PARAGRAPHd)

for N.C.Rajagopal & Co.,

BALANCE SHEET AS AT 31st MARCH, 2001

Particulars Schedule As at 31.03,2001 As at 31.03.2000

For N.C.Rajagopal & Co., SKM. MAEILANANDHAN S.K.M. SHREE SHIVKUMAR

N.C. SAMPATH G.N.VARADARAJAN R. MURALIDHARAN

Year Ended Year Ended

Other Income 1,793,107 931,996

Total 274,993,230 115,736,217

Profit (Loss) Before Interest & Depreciation 28,514,929 10,879,930

Depreciation 16,785,395 16,443,603

For N.C.Rajagopal & Co., SKM. MAEILANANDHAN S.K.M. SHREE SHIVKUMAR

N.C.SAMPATH G.N.VARADARAJAN R.MURALIDHARAN

SCHEDULES FORMING PART OF THE BALANCE SHEET

SCHEDULE - A - Share Capital

SCHEDULE E - FIXED ASSETS

Gross Block Depreciation Net Block

Land & Site Development 13,104,786 13,104,786 13,104,786 13,104,786

CURRENT ASSETS, LOANS AND ADVANCES