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Directors Report of Alok Industries Ltd.

Mar 31, 2015

Dear MEMBERS,

The Directors are pleased to present their 28th Annual Report together with the Audited Accounts for the 18 months period ended 31st March, 2015.

Financial Results

The financial performance of the Company for the 18 months period ended is summarized below:

(Rs. Crore) Particulars Stand alone 31.03.2015 30.09.2013 (18 Months) (18 Months)

Sales / Job charges (net of excise) 22130.72 19,917.75

Other Income 224.82 341.91

Total Income 22355.54 20259.66

Total Expenditure 17085.12 14,492.80

Operating Profit Before Interest, Depreciation & Taxes 5270.41 5766.86

Interest 3251.16 2542.45

Depreciation 1461.21 1,360.77

Profit Before exceptional items & Tax 558.04 1,863.64

Exceptional Items - (463.74)

Profit Before Tax 558.04 1,399.90

Add / (Less): Provision For Taxation

— Current Tax (92.90) (442.37)

— Deferred Tax Provision (204.12) (37.37)

— MAT Credit Entitlement 87.74 -

Profit After Tax 348.76 920.16

Add/(Less): Share of Profit of Associates - -

Profit After Tax after Minority Interest 348.76 920.16

Balance brought forward from the previous year 2328.84 1380.16

Add: Profit and Loss Reserve on Amalgamation - 49.31

Balance available for appropriation 2677.60 2300.32

Which the Directors apportioned as follows:

(i) Proposed Dividend - (41.32)

(ii) Dividend Tax thereon - (7.02)

(iii) Transferred from Debenture (3.03) 76.86 Redemption Reserve

(iv) Excess/(Short) Provision of Dividend and Tax - -

thereon of previous year

(v) Transferred to General Reserve - -

(vi) Transferred to Capital Reserve - -

Sub-total (3.03) 28.52

Balance to be carried forward 2674.57 2328.84

(Rs. Crore) Particulars Consolidated 31.03.2015 30.09.2013 (18 Months) (18 Months)

Sales / Job charges (net of excise) 24153.06 21,388.36

Other Income 467.20 412.00

Total Income 24620.26 21800.36

Total Expenditure 18983.71 16,155.19

Operating Profit Before Interest, Depreciation & Taxes 5636.55 5645.17

Interest 3512.72 2813.62

Depreciation 1521.78 1,418.20

Profit Before exceptional items & Tax 602.05 1 413.35

Exceptional Items (131) (634.38)

Profit Before Tax 471.05 778.97

Add / (Less): Provision For Taxation

— Current Tax (97.97) (449.28)

— Deferred Tax Provision (206.51) (35.04)

— MAT Credit Entitlement 87.74 -

Profit After Tax 254.31 294.65

Add/(Less): Share of Profit of Associates 3.95 2.07

Profit After Tax after Minority Interest 258.26 296.72

Balance brought forward from the previous year 1002.21 629.63

Add: Profit and Loss Reserve on Amalgamation - 49.31

Balance available for appropriation 1260.47 975.66

Which the Directors apportioned as follows:

(i) Proposed Dividend - (41.32)

(ii) Dividend Tax thereon (0.57) (7.94)

(iii) Transferred from Debenture Redemption Reserve (3.03) 76.86

(iv) Excess/(Short) Provision of Dividend and Tax - (0.58) thereon of previous year

(v) Transferred to General Reserve (0.78) (0.47)

(vi) Transferred to Capital Reserve - -

Sub-total (4.38) 26.55

Balance to be carried forward 1256.09 1002.21

Notes: Previous years'' figures have been reclassified/regrouped wherever necessary, to correspond with those of the current period

Year in Retrospect:

For the 18 months period ended 31st March, 2015 your Company recorded sales of Rs. 22130.72 crore. The exports of your Company for the year (including incentives) stood at Rs. 3861.60 crore. The profit before tax was at Rs. 558.04 crore.

Your Company''s performance for the period under review are given in greater detail in the ''Management Discussion and Analysis'', which forms part of this Directors'' Report.

Awards and Recognition

During the year under review, your Company has won awards in following categories:

A. From Cotton Textile Exports Council of India (TEXPROCIL):

1. Gold Trophy for the Highest Exports of Bed Linen/Bed Sheets/Quilts in Madeups;

2. Gold Trophy for the Highest Exports of Other Fabrics including Embroidered Fabrics, Laces;

3. Gold Trophy for the Highest Exports of Terry Towels in Madeups;

4. Silver Trophy for the Second Highest Exports of Bleached/ Dyed/Yarn Dyed/Printed Fabrics;

5. Silver Trophy for the Second Highest Global Exports (Overall).

B. From The Synthetic & Rayon Textiles Export Promotion Council:

6. Award for Fourth Best Overall Export Performance in the Category of SRTEPC Special Award (Trophy);

Dividend

The Board of Directors has not recommended any dividend on the Share Capital of the Company for the period ended 31st March 2015 considering the current cash flow position of the company.

Share Capital

During the period under review, your Company on 13th November, 2014 has granted 2,02,300 Equity Shares of Rs. 10.00 each for cash at par under ESOP Scheme to its employees. Accordingly, the Company''s equity share capital as on 31st March, 2015 stands at Rs. 1377.33 crore divided into 137,73,17,895 fully paid equity shares of Rs. 10/- each.

Loans

During 18 months period ended 31st March, 2015, your Company has repaid debt of Rs. 683.51 crore, both secured and unsecured. The total debt at the end of the period stood at Rs. 15346.67 crore compared to Rs. 16030.18 crore at the end of previous year.

Capital Expenditure

As at 31st March, 2015, the gross fixed assets (including CWIP) stood at Rs. 13563.18 crore and the net fixed assets stood at Rs. 8376.75 crore. During the period 18 Months ended 31st March, 2015, your company has incurred a capital expenditure of Rs. 147.41 crore across various divisions.

Details of your Company''s capacities across various divisions are provided under the head ''Alok''s Capacities'' (Table No.10) in the Management Discussion and Analysis annexed to this Report.

Extension of Accounting Period

Your Company has extended its accounting period upto 18 months, i.e. 1st October, 2013 to 31st March, 2015 and has obtained necessary approvals in this regard. Accordingly the Company has also obtained necessary approval to convene the Annual General Meeting on or before 26th June, 2015 in accordance with Section 166 read with Section 210 of the Companies Act, 1956.

Deposits

During the period under review your Company has not accepted any fixed deposits from the public. All deposits accepted during the previous periods have been repaid together with interest accrued upto the date of maturity.

Subsidiary Companies

At the end of the accounting period under review, your Company had the following subsidiaries:

Subsidiaries of Alok Industries Limited

1. Alok Infrastructure Limited

2. Alok International Inc. (incorporated in the state of New York, USA)

3. Alok International (Middle East) FZE (incorporated in Dubai)

4. Alok Singapore Pte Limited (incorporated in Singapore)

5. Alok Worldwide Limited (incorporated in the British Virgin islands)

6. Alok Trading Singapore Pte Limited (incorporated in Singapore)

7. Alok Universal Singapore Pte Limited (incorporated in Singapore)

8. Alok Global Singapore Pte Limited (incorporated in Singapore)

9. Alok Merchant Singapore Pte Limited (incorporated in Singapore)

10. Alok Global Trading (Middle East) FZE (incorporated in Dubai)

Step-down subsidiaries of Alok Industries Limited

Parent Company Subsidiary %Holding

Alok Infrastructure Alok Industries 100.00% Limited International Ltd.

Grabal Alok International 100.00% Limited

Alok Industries Mileta, a.s. (incorporated 100.00% International Ltd. in the Czech Republic) (incorp°rated in the British Virgin islands) Grabal Alok (UK) Limited 99.21%

Grabal Alok Grabal Alok (UK) Limited 0.66% International Ltd. (incorporated in the British Virgin islands)

The Members are requested to note that the Ministry of Corporate Affairs vide its General Circular No. 2/2011 dated February 8, 2011, has granted a general exemption to all the companies under Section 212(8) of the Companies Act, 1956, with regard to attaching the Balance Sheet, Profit & Loss Account and other documents of the subsidiaries of the company after complying with the directions given therein. However, the Members who wish to have a copy of the annual audited accounts of the subsidiaries will be provided the same upon receipt of a request from them and will also be available for inspection by any Member at the registered office of the Company and of the subsidiary companies on any working day except Saturday, between 11.00 am to 6.00 pm.

The specified financial information of subsidiary companies is disclosed along with the consolidated financial statements of the Company. In accordance with the requirements of the Listing Agreement executed with the Stock Exchanges, the consolidated financial statements of the Company are annexed to the Annual Report.

Auditors'' Report

There are no qualifications, reservations, or adverse remarks or disclaimers made by the Deloitte Haskins & Sells LLP, Statutory Auditors, in their report. Observations made in the Auditors Report are self-explanatory and therefore do not call for any further comments under Section 134(1) of the Companies Act, 2013.

Employees Stock Option Plans

On September 28, 2013, the Remuneration Committee granted 2,30,44,650 options under Grant 3 at an exercise price of Rs. 10 each. The above options vests for a year i.e. upto September 28, 2014 and can be exercised by the Employees upto September 28, 2016. Each option represents a right but not obligation to apply for 1 fully paid equity share of Rs. 10/- During the period, the Company on 13th November, 2014 has allotted 2,02,300 options for cash at par under ESOP Scheme to its employees. 36,90,950 options lapsed during the period due to separations. 1,91,29,600 options are in force as at 31st March 2015 and all these options have vested.

The information as required pursuant to the Securities & Exchange Board of India (Employees'' Stock Option Scheme and Employees'' Stock Purchase Scheme) Guidelines, 1999 is annexed hereto as Annexure I and forms part of this report.

Business Responsibility Reporting

SEBI vide its Circular CIR/CFD/DIL/8/2012 dated August 13, 2012, has mandated the top 100 listed entities, based on market capitalisation on BSE Limited and National Stock Exchange of India Limited at March 31, 2012, to include Business Responsibility Report ("BRR") as part of the Annual Report.

Though, the aforesaid circular does not apply to your company, the Board of Directors are voluntarily providing a separate section on BRR as part of this Annual Report.

Corporate Social Responsibility (CSR) and CSR Committee

In accordance with the provisions of Section 135 of the Companies Act, 2013, the Company is required to constitute a Corporate Social Responsibility (CSR) Committee of Directors comprising at least three directors including an independent director.

The board has constituted the CSR Committee comprising Mr. S. K. Bhoan, Mr. Sunil O. Khandelwal and Mr. K.H. Gopal.

The Companies Act, 2013 and the rules made thereunder has defined various activities that can be undertaken towards CSR initiatives which inter alia include poverty eradication, health, education, promoting gender equality, environment sustainability, protection of national heritage, benefits for armed forces veterans and their dependents, sports, contributions to approved central government funds and rural development projects.

The terms of reference of the committee inter alia include formulation of a CSR policy indicating the activities that will be undertaken, recommending the CSR policy to the board for adoption, recommending the amount of expenditure to be incurred and ensuring a transparent monitoring mechanism for undertaking such activities. The CSR committee will monitor the implementation of the CSR policy and apprise the board accordingly.

Details of CSR initiatives undertaken by the Company during the year are given under the head ''Sustainability'', in the Management Discussion and Analysis forming part of this Annual Report.

Corporate Governance

The Securities and Exchange Board of India (SEBI) has prescribed certain corporate governance standards vide Clause 49 of the Listing Agreement with stock exchanges. Your Directors reaffirm their commitment to these standards and a detailed Report on Corporate Governance together with the Auditors'' Certificate on its compliance is annexed hereto.

Directors

During the year, Mr. Ashok B. Jiwrajka, Executive Chairman of the Company has relinquished the post of Executive Chairman from the Board and continues as an Executive Director of the Company.

The Board of Directors through circulation appointed Mr. S K Bhoan as an additional independent Director effective from 30.03.2015.

In accordance with the Articles of Association of your Company, Mr. Sunil O. Khandelwal, Executive Director & CFO and Mr. K. H. Gopal, Executive Director & Secretary, retires from office by rotation, and being eligible, offer themselves for reappointment at the ensuing Annual General Meeting of the Company.

The brief resume of Mr. Sunil O. Khandelwal, Mr. K. H. Gopal, Mr. Timothy Ingram and Mr. S. K. Bhoan, as required interalia in terms of Clause 49 of the Listing Agreement with the stock exchanges, are provided elsewhere in this Annual Report.

During the year Mr. Sudhir Garg was appointed as Nominee Director representing IFCI Limited to fill the casual vacancy caused by the resignation of Mr. M. V. Muthu with effect from 13th February, 2014.

During the year Mr. K. R. Modi, Independent Director and Mr. Samuel Joseph, Nominee Director of Export-Import Bank of India, had resigned from the Board of Directors with effect from 13th February, 2014 and 1st December, 2014 respectively.

The Board of Directors places on record their sincere appreciation for the contribution and valuable service rendered by Mr. M. V. Muthu, Mr. K R Modi and Mr. Samuel Joseph during their tenure.

Section 149 and other applicable provisions of the Companies Act, 2013, require the Company to have atleast one-third of the total number of Directors as Independent Directors. In the opinion of the Board, Mr. Timothy Ingram and Mr. S.K.Bhoan are Independent Directors in terms of the Listing Agreement, meet the criteria of independence in terms of section 149 (6) of the Act, are being considered for appointment as Independent Directors of the Company under sections 149,150 and 152 read with Schedule IV of the Act. The Company has received declarations from all these Directors of the Company confirming that they meet with the criteria of independence as prescribed both under section 149 (6) and Schedule IV of the Companies Act, 2013 and clause 49 of the Listing Agreement with the Stock Exchanges. Accordingly resolutions will be placed at the ensuing Annual General meeting (AGM) for their appointment as Independent Directors for a period of five consecutive years from the date of ensuing AGM not liable to retire by rotation.

Further, the required resolutions for confirmation/appointment/ re-appointment of the above Directors at the forthcoming Annual General Meeting are included in the Notice convening 28th Annual General Meeting.

Directors'' Responsibility Statement

Your Directors state that:

i. in the preparation of the annual accounts for the 18 months period ended 31st March, 2015, the applicable Accounting Standards have been followed and there has been no material departure from the same;

ii. the Directors have selected such accounting policies, consulted 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 your Company as at 31st March, 2015 and of the profit of your Company for the period ended on that date;

iii. the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act for safeguarding the assets of your Company and for preventing and detecting fraud and other irregularities;

iv. they have prepared the annual accounts for the 18 months period ended 31st March, 2015 on a ''going concern'' basis and

v. the Company has adequate internal systems and controls in place to ensure compliance of laws applicable to the Company.

vi. the Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems are adequate and operating effectively.

Consolidated financial statements

Your Company has prepared Consolidated Financial Statements in accordance with Accounting Standards AS- 21, AS-23 and AS-27 issued by the Institute of Chartered Accountants of India. The Consolidated Statements reflect the results of the Company and that of its Subsidiaries, Joint Ventures and Associates.

As required by clause 32 of the Listing Agreement with the Stock Exchanges, the Audited Consolidated Financial Statements together with the Auditors Report thereon are annexed and form part of this Annual Report.

The Consolidated Financial Statements of the Company prepared as per the Accounting Standard AS-21 and Accounting Standard AS-23, consolidating the Company''s accounts with its subsidiaries and an associate have also been included as part of this Annual Report.

Auditors

Messrs Deloitte Haskins & Sells LLP, Chartered Accountants (Firm Registration No.117366W/ W-100018), Statutory Auditors of the Company, hold office till the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment.

The Company has received a confirmation from Messrs Deloitte Haskins & Sells LLP to the effect that their appointment, if made, at the ensuing AGM would be in terms of Sections 139 and 141 of the Companies Act, 2013 and rules made there under and that they are not disqualified for re-appointment.

Cost Auditor

Pursuant to the directives of the Central Government under the provisions of the Companies Act, 2013, the Board of Directors at their meeting held on 28th May 2015 has appointed M/s B. J. D. Nanabhoy & Co., Cost Accountants as Cost Auditors to conduct audit of cost records relating to the products manufactured by your Company for the Financial Year 2015-16.

Secretarial Audit

Pursuant to provisions of Section 204 of the Companies Act, 2013, the Board appointed Mr. Virendra G Bhatt, Practising Company Secretary, as Secretarial Auditor to carry out the secretarial audit for the financial year 2015-2016. Since the provisions relating to the disclosures are not applicable for the year under review, the secretarial audit report is not enclosed to the Boards'' report for the year ended 31st March, 2015.

Particulars of Employees

Your Directors appreciate the significant contribution made by the employees to the operations of your Company during the period.

The information required on particulars of employees as per Section 217(2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975 is given in a separate Annexure to this Report. As per the provisions of Section 219(1) (b) (iv) of the Companies Act, 1956, the Report and Accounts are being sent to all shareholders of your Company excluding the Statement of Particulars of Employees (Annexure). Any shareholder interested in obtaining a copy of the said Annexure may write to your Company Secretary at the Corporate Office of your Company.

More details on the Human Resources function of your Company and its various activities are given in the ''Human Resources'' and ''Sustainability'' sections of the attached Management Discussion & Analysis.

Vigil mechanism/ Whistle Blower Policy:

The Company has formulated a vigil mechanism (whistle blower policy) for its directors and employees of the Company for reporting genuine concerns about unethical practices and suspected or actual fraud or violation of the code of conduct of the Company as prescribed under the Companies Act, 2013 and Clause 49 of the Listing Agreement. This vigil mechanism shall provide a channel to the employees and Directors to report to the management concerns about unethical behavior, and also provide for adequate safeguards against victimization of persons who use the mechanism and also make provision for direct access to the chairperson of the Audit Committee in appropriate or exceptional cases.

Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo

The information under Section 134 (3) (m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 for the year ended March 31, 2015 are annexed hereto and forms part of this report.

Green Initiative by The Ministry Of Corporate Affairs

The Ministry of Corporate Affairs ("MCA") has taken a Green Initiative in Corporate Governance by permitting electronic mode for service of documents to Members (shareholders) as per relevant provisions of the Companies Act, 2013 ("the Act").

Pursuant to provisions of the Act, and rules made thereunder, service of documents to Members can be now made by electronic mode on the email address provided for the purpose of communication. If a Member has not provided an email address, other permitted modes of service would to be applicable.

Your Company sincerely appreciates shareholders who have contributed towards furtherance of Green Initiative. We further appeal to other shareholders to contribute towards furtherance of Green Initiative by opting for electronic communication. The shareholders may also reach out to the Company/RTA by sending a request letter alongwith a self attested PAN copy. The request can also be made online on Alok website (www.alokind.com), post which the RTA would contact the concerned shareholder for the requisite documentation.

This initiative will ease the burden on corporates (and the environment) of sending physical documents such as notices, annual reports etc. Those who have not provided their email address will continue to receive communications, dissemination, notice(s), documents etc. via permitted mode of service of documents. Further the shareholders, who request for physical copies, will be provided the same at no additional cost to them.

The Company is providing e-voting facility for all Members to enable them to cast their votes electronically on all resolutions set forth in the Fourteenth AGM Notice. This is pursuant, interalia, to Section 108 of the Companies Act, 2013 and Rule 20 of the Companies (Management and Administration) Rules 2014. The detailed instructions for e-voting are provided in the AGM Notice which is being sent separately as per prescribed mode of dispatch.

Companies Act, 2013

The Companies Act, 2013 was notified in the Official Gazette of the Government of India on August 29, 2013. On September 12, 2013, the Ministry of Corporate Affairs (MCA) notified 98 sections and on March 27, 2014, the MCA notified another 198 sections, which were deemed to come into force with effect from April 1,2014.

The MCA vide Circular No. 08/2014 dated April 4, 2014 clarified that the financial statements and the documents required to be attached thereto, the auditors'' and directors'' report in respect of the financial year under reference shall continue to be governed by the relevant provisions of the Companies Act, 1956, schedules and rules made there under.

The Company has accordingly prepared this balance sheet, statement of profit & loss, the schedules and notes thereto and the Directors'' Report in accordance with the relevant provisions of the Companies Act, 1956, schedules and rules made there under. The Company has taken cognisance of the new legislation and shall comply with the provisions of the Companies Act, 2013, as applicable.

Acknowledgements

The Board of Directors wish to place on record its sincere appreciation for the support received from its stakeholders including shareholders, bankers, distributors, suppliers and business associates. The Directors recognize and appreciate the sincere, hard work, loyalty, dedicated efforts and contribution of all the employees that ensured sustained performance in a challenging business environment.

For and on behalf of the Board

Dilip B. Jiwrajka Managing Director

Place: Mumbai Dated: 28th May 2015


Mar 31, 2012

We have pleasure in presenting the 26 Annual Report of your Company together with the Audited Accounts for the financial year ended 31 March 2012. The summarized financial results (stand-alone and consolidated) are given below in Table 1.

Table 1: Financial Highlights: Stand-Alone and Consolidated

(Rs. Crore)

PARTICULARS Standalone Consolidated

2011-12 2010-11 2011-12 2010-11

Sales/Job charges(net of excise) 8,900.86 6,388.43 9,784.72 6,614.90

Other Income 65.60 41.09 95.51 67.07

Total Income 8,966.46 6,429.52 9,880.23 6,681.97

Total Expenditure 6,341.71 4,549.82 7,408.31 4,827.74

Operating Profit Before interest, Depreciation & Taxes 2,624.75 1,879.70 2,471.92 1,854.23

Interest 1,149.55 736.27 1,234.70 782.15

Depreciation 713.43 518.79 749.14 530.97

Profit Before exceptional Items & Tax 761.77 624.64 488.08 541.11

Exceptional Items 121.27 41.45 121.27 39.87

Profit Before Tax 640.50 583.19 366.81 501.24

Less: Provision For Taxation

- Current Tax (157.64) (78.15) (172.93) (81.16)

- Deferred (102.33) (100.68) (100.97) (97.34)

Profit After Tax 380.53 404.36 92.91 322.74

Add/(Less):

Share of Profit of Associates - - 0.08 (10.89)

Minority interest - - - (0.31)

Profit After Tax after Minority interest 380.53 404.36 92.99 311.54

Notes:

Previous years figures have been regrouped wherever necessary to bring them in line with the current years representation of figures

Performance

During the financial year, your Company recorded sales of Rs 8,900.86 crore an increase of 39.33% over the previous year and exports (including incentives) increased by 36.62% to Rs 3,029.55 crore. The operating profit before tax during the year stood atRs 761.77 crore an increase of 21.95% over the previous year.

All the divisions of your company recorded growth with lead being taken by Cotton Yarn, Polyester Yarn, Home Textiles and Apparel Fabrics.

Details of your Companys performance for the year under review are given in the Management Discussion and Analysis, which forms part of this Directors Report.

Dividend

Your Directors have recommended a dividend of Rs 0.30 per equity share of Rs 10/ - each (previous year Rs 0.25 per share) for the financial year ended 31 March 2012 and seek your approval for the same. If approved, the total amount of dividend to be paid to the equity shareholders will be Rs 24.79 crores (excluding tax of Rs 4.02 crores) as against Rs 19.69 crore paid last year (excluding tax of Rs 3.27 crore). Based on the above dividend payout (including dividend tax), the dividend payout ratio works out to 7.57% of Profit After Tax (PAT) as against 5.68% for 2010-11.

Capital

During the year under review your Company issued and allotted 1,60,00,000 Equity Shares to a Promoter Group Company, against the conversion of warrants. The said warrants were originally issued to Arum Investments

Private Limited by M/s. Grabal Alok Impex Limited and the same were subsequently purchased by M/s. Jiwrajka Investments Private Limited.

Pursuant to the amalgamation of M/s Grabal Alok Impex Limited with the Company, your Company has issued and allotted 2,24,85,000 Equity Shares of Rs 10/ - each to the existing equity shareholders of M/s. Grabal Alok Impex Limited, whose names appeared in the register of members of the Company on the record date i.e. 14th March, 2012 in the ratio of 1:1.

The Companys equity share capital as on 31 March 2012 stands at Rs 826.28 crore divided into 82,62,69,357 fully paid equity shares ofRs 10/- each.

Reserves

The balance available for appropriation as at 31 March 2012 amounted to Rs 1,356.99 crores. After providing for dividend and dividend tax of Rs 28.73 crore, your Company proposes to transfer Rs 51.90 crore to Debenture Redemption Reserve. After providing for these, the balance of the Profit & Loss Account would stand at Rs 1,380.16crore.

At the end of the financial year, the total reserves of the Company thus, stood at Rs 2,829.22 crore; the corresponding figure at the end of the previous year was Rs 2309.80 crore.

Loans

During the year under review, your Company has raised incremental debt of Rs 2,241.89, both secured and unsecured, by way of rupee loans, foreign currency loans and non-convertible debentures for meeting capital expenditure and working capital requirements. The total debt at the end of year stood at Rs 11,139.48 crore compared to Rs 8,897.59 crore at the end of previous year.

Capital Expenditure

During the year under review, your company has incurred a capital expenditure of Rs 1,919.79 crore across various divisions. A major portion of these were towards cotton spinning, expansion of weaving and processing capacities, setting up additional Continuous Polymerization (CP) Plant .expansion of Texturising and regular capex.

Details of your Companys capacities across various divisions are provided under the head Capacity Expansion in the Management Discussion and Analysis annexed to this Report.

Amalgamation

During the year under review, the Honble High Court, Bombay had vide its Order dated February 03, 2012 sanctioned the Scheme of Amalgamation (the "Scheme") of Grabal Alok Impex Limited with your Company with appointed date April 01, 2011 and the Scheme has become effective on 1st March, 2012.

Pursuant to the aforesaid merger, your Company have allotted 2,24,85,000 Equity Shares ofRs 10/ — each to the existing equity shareholders of M/s. Grabal Alok Impex Limited in the ratio of 1:1 and the said shares are listed with BSE and NSE.

Subsidiary Companies

At the end of the financial year under review, your Company had the following subsidiaries:

Subsidiaries of Alok Industries Limited

1. Alok International Inc.

2. Alok Infrastructure Limited

3. Alok H&A Limited

4. Alok Retail (India) Limited

5. Alok Apparels Private Limited

6. Alok Land Holdings Private Limited

7. Alok International (Middle East) FZE

8. Alok Singapore Pte Limited

Step-down subsidiaries of Alok Industries Limited

Parent Company Subsidiary %Holding

Alok Infrastructure Limited Alok Realtors Private Limited 100%

Springdale Information and Technologies Private Limited 100%

Kesham Developers & Infotech Private Limited 100%

Alok Industries International Ltd. 100%

Grabal Alok International Limited 100%

Alok Industries International Ltd. Mileta, a.s. 100%

Alok European Retail, s.r.o. 98.05%

Grabal Alok (UK) Limited 41.72%

Grabal Alok International Limited Grabal Alok (UK) Limited 48.71%

The Ministry of Corporate Affairs, Government of India has issued a Circular No.2/2011 dated 8th February 2011 granting general exemption to Companies under section 212 (8) from attaching the documents referred to in section 212 (1) pertaining to its subsidiaries, subject to approval by the Board of Directors of the Company and furnishing of certain financial information in the Annual Report.

The Board of Directors of the Company have accordingly accorded approval to the Company dispensing with the requirement of attaching to its Annual Report the annual audited accounts of the Companys subsidiaries.

Accordingly, the Annual Report of the Company does not contain the individual financial statements of these subsidiaries, but contains the audited consolidated financial statements of the Company, its subsidiaries and associate. The Annual Accounts of these subsidiary companies and the related detailed information will be made available to the shareholder seeking such information at any point of time. The annual accounts of the Subsidiary Companies will also be kept for inspection by any shareholder at its registered / corporate office and that of the concerned subsidiary companies. The statement pursuant to the approval under section 212 (8) of the Companies Act, 1956 is annexed together with the Annual Accounts of the Company.

Consolidated financial statements

The Consolidated Financial Statements of the Company prepared as per the Accounting Standard AS21 and Accounting AS 23, consolidating the Companys accounts with its subsidiaries and an associate have also been included as part of this Annual Report.

Business and Operations

A detailed review of the operations, performance and future outlook of the Company and its businesses is given in the Managements Discussion and Analysis, which forms part of this Report.

Awards and Recognition

During the year under review, your Company has been given the following awards and recognitions by the Cotton Textile Exports Council of India (TEXPROCIL) in three categories:

- GOLD Trophy for Global Exports of Bleached / Dyed / Yarn Dyed / Printed Fabrics in Fabrics Category

- GOLD Trophy for Exports of Bed Linen / Bed Sheets /Quilts in Made-ups Category

- SILVER Trophy for Highest Global Exports Category

- SILVER Trophy for second best export performance for the year 2010-11 in the category of Polyester Yarn by SRTEPC

Corporate Social Responsibility

Details of your Companys Corporate Social Responsibility (CSR) initiatives are given in a separate section, Sustainability, which forms part of the accompanying Management Discussion and Analysis and Annual Report.

Corporate Governance

The Company is committed to maintain the highest standards of Corporate Governance. Your Company continues to be compliant with the requirements enshrined in clause 49 of the Listing Agreement which relates to Corporate Governance.

A separate report on Corporate Governance is enclosed as a part of this Annual Report. A certificate from the Statutory Auditors of your Company regarding compliance with Corporate Governance norms stipulated in Clause 49 of the Listing Agreement is also annexed to the report on Corporate Governance.

Fixed Deposits

Your Company does not have any fixed deposits under section 58A and 58AA of The Companies Act, 1956 read with Companies (Acceptance of Deposits) Rule, 1975.

Insurance

All the insurable interests of your Company including inventories, buildings, plant and machinery are adequately insured.

Directors

Mr. Ashok B. Jiwrajka and Mr. Dilip Jiwrajka will retire from office by rotation at the ensuing Annual General Meeting and, being eligible, offer themselves for reappointment. Brief resumes of these Directors, in line with the stipulations of Clause 49 of the Listing Agreement, are provided elsewhere in this Annual Report.

During the year, Mr. Rakesh Kapoor, nominee director of IFCI Limited, resigned from the Board of Directors w.e.f. 29th April, 2011 and in his place Mr. M.V.Muthu was appointed as IFCI nominee. Mr. Debashish Mallick, nominee director of IDBI Bank Limited, resigned from the Board of Directors w.e.f. 23rd June, 2011 and in his place Mrs. Maya Chakravorty was appointed as IDBI nominee and Mr. K.D. Hodavdekar, nominee director of IDBI Bank Limited, resigned from the Board of Directors w.e.f. 04th July, 2011. The Board wishes to place on record their appreciation for the contribution of Mr. Rakesh Kapoor Mr. Debashish Mallick and Mr. K.D. Hodavdekar during their tenure as Directors of your Company.

Directors Responsibility Statement

Your directors affirm that the audited accounts containing the financial statements for the financial year 2011 -12 are in conformity with the requirements of the Companies Act, 1956. They believe that the financial statements reflect fairly the form and substance of transactions carried out during the year and reasonably present the Companys financial condition and results of operations.

Pursuant to section 217(2AA) of the Companies Act, 1956, your Directors subscribe to the Directors Responsibility Statement and hereby confirm that:

- in the preparation of the annual accounts for the financial year ended 31 March 2012, the applicable Accounting Standards have been followed and there has been no material departure;

- the Directors have selected such accounting policies, consulted and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of your Company as at 31 March 2012 and of the profit of your Company for the year on that date;

- the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act,1956 for safeguarding the assets of your Company and for preventing and detecting fraud and other irregularities;

- they have prepared the annual accounts for the financial year ended 31 March 2012 on a going concern basis.

Auditors and Auditors Report

M/s. Gandhi & Parekh, Chartered Accountants and M/s. Deloitte Haskins & Sells, Chartered Accountants, Statutory Auditors of the Company, hold office until the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment.

The Company has received the letter from M/s. Deloitte Haskins & Sells to the effect that their re-appointment, if made, would be within the prescribed limits under section 224 (1B) of the Companies Act, 1956 and that they have not disqualified for re-appointment within the meaning of the section 226 of the said Act.

The observations made in the Auditors Report are self-explanatory and therefore, do not call for any further comments under section 217(3) of the Companies Act, 1956.

Cost Auditor

Pursuant to the directives of the Central Government under the provisions of Section 233B of the Companies Act, 1956 and subject to the approval of the Central Government, M/s B. J. D. Nanabhoy & Co., Cost Accountants, Mumbai have been appointed as Cost Auditors to conduct cost audit relating to the products manufactured by your Company.

Employees Stock Option Plans

Alok ESOS 2010 was approved by shareholders in the previous year. During the year Remuneration Committee of the Board granted 1,05,87,950 options net of lapse at an exercise price ofRs 18.90 and at Rs21.42 per option. The information as required pursuant to the Securities & Exchange Board of India (Employees Stock Option Scheme and Employees Stock Purchase Scheme) Guidelines, 1999 is annexed hereto as Annexure I and forms part of this report.

A certificate from M/s Gandhi & Parekh, Chartered Accountants, Statutory Auditors, with regard to the implementation of the Companys ESOP 2010, would be open for inspection in the ensuing Annual General Meeting.

Particulars of Employees

The information required on particulars of employees as per Section 217(2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975 forms part of this report. As per the provisions of Section 219(1)(b)(iv) of the Companies Act, 1956, the Report and Accounts are being sent to all shareholders of your Company excluding the Statement of Particulars of Employees. Any shareholder interested in obtaining a copy of the said statement may write to your Company Secretary at the Corporate Office of your Company.

More details on the Human Resources function of your Company and its various activities are given in the Human Resources and Sustainability sections of the attached Management Discussion & Analysis.

Your Directors appreciate the significant contribution made by the employees to the operations of your Company during the year.

Conservation of Energy, Technology absorption, Foreign Exchange Earnings and Outgo

The particulars as prescribed under Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 are attached as Annexure II to this report.

Acknowledgements

Your Directors wish to place on record their deep sense of appreciation for all the stake holders of the Company who have been continuously supporting the growth of your Company. In particular, the Directors value the dedication and commitment of your Companys employees and thank the Central and State Governments, Financial Institutions, Banks, Government authorities, customers, vendors and shareholders for their continued cooperation and support.

For and on behalf of the Board

Place: Mumbai Dilip B. Jiwrajka

Date : May 18,2012 Managing Director


Mar 31, 2011

Dear Shareholders:

We have pleasure in presenting the 25 Annual Report of your Company together with the Audited Accounts for the financial year ended 31 March 2011. The summarized financial results (stand-alone and consolidated) are given below in Table 1.

Table 1: Financial Highlights: Stand-Alone and Consolidated

(Rs. crore)

Particulars Standalone Consolidated

2010-11 2009-10 2010-11 2009-10

Sales / Job charges (net of excise) 6,388.43 4,311.17 6,614.90 4,424.34

Other Income 19.43 64.02 5.03 64.68

Total Income 6,407.65 4,375.19 6,619.93 4,489.02

Total Expenditure 4,638.51 3,102.71 4,912.69 3,257.23

Operating Profit before interest, depreciation & taxes 1,756.35 1,272.48 1,723.24 1,231.79

Interest 654.37 535.08 675.03 578.90

Depreciation 518.79 362.61 530.97 366.92

583.19 374.79 501.24 285.97

Less : Provision for Taxation

– Current (120.57) (63.56) (123.52) (65.94)

– MAT credit entitlement 42.25 34.26 42.25 34.26

– Deferred (100.68) (99.01) (97.34) (96.96)

– Fringe Benefit Tax – – – 0.02

– Prior period adjustment of Tax 0.17 0.86 0.11 0.46

Net Profit from Ordinary Activities After Tax 404.36 247.34 322.73 157.81

– – – –

Profit After Tax 404.36 247.34 322.73 157.81

Add : Share of Profit from Associates – – (10.89) (20.74)

: Minority Interest – – (0.31) 0.64

Profit After Tax After Minority Interest 404.36 247.34 311.54 137.71

Add : Balance Brought Forward 180.91 276.63 (52.48) 149.78

Balance available for appropriation 585.27 523.97 259.06 287.49

Excess Provision of Dividend for Earlier Years – (0.00) 0.40 0.15

Dividend: Equity 19.69 19.69 19.69 19.69

Tax on Dividend 3.27 3.27 3.27 3.27

Transfer to Capital Redemption Reserve – – – –

Transfer to Debenture Redemption Reserve (384.30) 300.10 (384.30) 296.63

Transfer to General Reserve 25.00 20.00 25.03 20.23

Balance carried to Balance Sheet 921.61 180.91 594.97 (52.48)

Notes: Previous years' figures have been regrouped wherever necessary to bring them in line with the current year's representation of figures

Performance

During the financial year, your Company sales increased by 48.18% to Rs. 6,388.43 crore and achieved profit after tax of Rs. 404.36 crore, an increase of 68.48 % over the previous year. The exports of your Company for the year, including incentives, increased by 42.24% to Rs. 2,217.43 crore. All the divisions of your company recorded growth both in domestic and export sales.

Details of your Company's performance for the year under review are given in the 'Management Discussion and Analysis', which forms part of this Directors' Report.

Dividend

Your Directors have recommended a dividend of Rs. 0.25 per equity share of Rs. 10/ – each (previous year Rs. 0.25 per share) for the financial year ended 31 March 2011 and seek your approval for the same. If approved, the total amount of dividend to be paid to the equity shareholders will be Rs. 19.69 crores (excluding tax of Rs. 3.27 crores). Based on the above dividend payout (including dividend tax), the dividend payout ratio works out to 5.68% of Profit After Tax (PAT) as against 9.28% for 2009-10.

Capital

During the year under review, your Company, as per the terms of Letter of Offer dated 19 March 2009 and relevant provisions of Articles of Association of the Company, forfeited 13,921 partly paid rights equity shares held by 83 shareholders for non- payment of allotment money of Rs. 5/ – and interest due thereon.

Consequent to the forfeiture of Rights shares the Company's equity share capital as on 31 March 2011 stands at Rs. 787.78 crore divided into 78,77,84,357 fully paid equity shares of Rs. 10/ – each.

FCCBs

The 475 outstanding FCCBs of USD 50000 each aggregating to Rs. 107.21 crore as at 31 March 2010 were redeemed during the year, on their due date i.e. 26 May 2010.

Reserves

The balance available for appropriation as at 31 March 2011 amounted to Rs. 585.27 crores. After providing for dividend and dividend tax of Rs. 22.96 crore, your Company proposes to transfer Rs. 384.30 crore to Debenture Redemption Reserve and Rs. 25.00 crore to General Reserve. After providing for these, the balance of the Profit & Loss Account would stand at Rs. 920.61 crore.

At the end of the financial year, the total reserves of the company, stood at Rs. 2309.08 crores compared to Rs. 1928.40 crore in at the end of previous year.

Loans

During the year under review, your Company has raised incremental debt of Rs. 1143.89 crore, both secured and unsecured, by way of rupee loans, foreign currency loans and non-convertible debentures for meeting capital expenditure and working capital requirements. The total debt at the end of year stood at Rs. 9653.57 crore compared to Rs. 8509.68 crore at the end of previous year.

Capital Expenditure

During the year under review, your company has incurred a capital expenditure of Rs. 1862.92 crore across various divisions. A major portion of these were towards cotton spinning, expansion of weaving and processing capacities, setting up additional Continuous Polymerization (CP) plant, expansion of Texturising Plant and regular capex.

Details of your Company's capacities across various divisions are provided under the head 'Capacity Expansion' in the Management Discussion and Analysis annexed to this Report.

Merger

Your Directors at their meeting held on 29 July 2011 approved the proposal of amalgamation of Grabal Alok Impex Limited ('GAIL') into the Company as per terms and conditions mentioned in the Scheme of Amalgamation to be filed with the stock exchanges. The salient features of the proposed Scheme are as under:

(a) Amalgamation of GAIL with the Company;

(b) The Appointed Date of the Scheme will be 1 April 2011;

(c) The Com pany to issue its shares to the shareholders of GAIL as on record date, based on the share exchange ratio determined by the independent valuers, M/s Ernst & Young Private Limited and the fairness report provided by Fortune Financial Services (India) Limited and approved by the Board of Directors of the Company which is as under:

"1 (One) fully paid up equity share of Rs. 10 each of the Company shall be issued and allotted for every 1 (One) equity share of Rs. 10 each held in GAIL"

(d) The Scheme is subject to approval of the shareholders, creditors, the Financial Institutions /Banks, the Hon'ble High Court of Bombay, relevant stock exchanges and any other statutory or regulatory authorities, which by law may be necessary for the implementation of the Scheme.

Subsidiary Companies

At the end of the financial year under review, your Company had the following subsidiaries:

Subsidiaries of Alok Industries Limited

1. Alok Industries International Ltd. (incorporated in the British Virgin islands)

2. Alok International Inc. (incorporated in the state of New York, USA)

3. Alok Inc. (incorporated in the state of New York, USA)

4. Alok Infrastructure Limited

5. Alok H&A Limited

6. Alok Retail (India) Limited (Formerly known as Alok Homes & Apparel Private Limited)

7. Alok Apparels Private Limited

8. Alok Land Holdings Private Limited

Step-down subsidiaries of Alok Industries Limited

Parent Company Subsidiary %Holding

Alok Industries International Ltd. Mileta, a.s.(incorporated in the Czech Republic) 100% holding

Alok European Retail, s.r.o. 100% holding

Alok Infrastructure Limited Alok Realtors Private Limited 100% holding

Alok HB Hotels Private Limited 100% holding

Alok HB Hotels Properties Limited 100% holding

Springdale Information and Technologies Private Limited 100% holding

Kesham Developers & Infotech Private Limited 100% holding

Alok Land Holdings Private Limited Alok Aurangabad Infratex Private Limited 100% holding

Alok New City Infratex Private Limited 100% holding

The Ministry of Corporate Affairs, Government of India has issued a Circular No.2 / 2011 dated 8 February 2011 granting general exemption to Companies under section 212 (8) from attaching the documents referred to in section 212 (1) pertaining to its subsidiaries, subject to approval by the Board of Directors of the Company and furnishing of certain financial information in the Annual Report.

The Board of Directors of the Company have accordingly accorded approval for dispensing with the requirement of attaching to its Annual Report the annual audited accounts of the Company's subsidiaries.

Accordingly, the Annual Report of the Company does not contain the individual financial statements of these subsidiaries, but contains the audited consolidated financial statements of the Company, its subsidiaries and associate. The Annual Accounts of these subsidiary companies and the related detailed information will be made available to the shareholder of the holding and subsidiary companies seeking such information at any point of time. The annual accounts of the Subsidiary Companies will also be kept for inspection by any shareholder at its registered / corporate office and that of the concerned subsidiary companies. The statement pursuant to the approval under section 212 (8) of the Companies Act, 1956 is annexed together with the Annual Accounts of the Company.

Consolidated financial statements

The Consolidated Financial Statements of the Company prepared as per the Accounting Standard AS 21 and Accounting AS 23, consolidating the Company's accounts with its subsidiaries and an associate have also been included as part of this Annual Report.

Shift in Registered Office

The registered office of your company was shifted from 'B/43, Mittal Tower, Nariman point, Mumbai 400 021, Maharashtra' to '17/5/1 & 521/1 Rakholi / Saily, Silvassa - 396 230, Union Territory of Dadra & Nager Haveli effective from 25 June 2010 pursuant to an Order passed by the Company Law Board.

Business and Operations

The business prospects of your company are quite encouraging considering the demand outlook in domestic as well as export markets. The drivers of growth are however different for both the markets.

More details about your Company's business operations and new initiatives are contained in the Management Discussion & Analysis.

Awards and Recognition

During the year under review, your Company was awarded the following awards and recognitions by the Cotton Textile Exports Council of India (TEXPROCIL) in three categories:

- Gold Trophy in Highest Exports of Bleached/ Dyed/ Yarn - dyed/ Printed Fabrics"

- Gold Trophy in - "Highest Exports of Bed - Linen/ Bed sheets/ Quilts"

- Silver Trophy in - "Highest Global Exports"

- The Company is the proud winner of IMC - Ramakrishna Bajaj National Quality (RBNQ) Performance Excellence Trophy - 2010 in its maiden attempt

Corporate Social Responsibility

Details of your Company's Corporate Social Responsibility (CSR) initiatives are given in a separate section, 'Sustainability', which forms part of the accompanying Management Discussion and Analysis and Annual Report.

Corporate Governance

A separate report on Corporate Governance is enclosed as a part of this Annual Report. A certificate from the Statutory Auditors of your Company regarding compliance with Corporate Governance norms stipulated in Clause 49 of the Listing Agreement is also annexed to the report on Corporate Governance.

Fixed Deposits

Your Company does not have any fixed deposits under section 58A and 58AA of The Companies Act, 1956 read with Companies (Acceptance of Deposits) Rule, 1975.

Insurance

All the insurable interests of your Company including inventories, buildings, plant and machinery are adequately insured.

Directors

Mr. Chandrakumar Bubna and Mr. Timothy Ingram will retire from office by rotation at the ensuing Annual General Meeting and, being eligible, offer themselves for reappointment. Brief resumes of these Directors, in line with the stipulations of Clause 49 of the Listing Agreement, are provided elsewhere in this Annual Report.

During the year, A. B. Dasgupta, nominee director of IDBI Bank Limited, resigned from the Board of Directors w.e.f. 1 November 2010 and in his place Mr. Debashish Mallick was appointed as IDBI's nominee. The Board wishes to place on record their appreciation for the contribution of Mr. A. B. Dasgupta during his tenure as Directors of your Company.

Directors' Responsibility Statement

Pursuant to section 217(2AA) of the Companies Act, 1956, your Directors subscribe to the 'Directors' Responsibility Statement' and hereby confirm that:

- in the preparation of the annual accounts for the financial year ended 31 March 2011, the applicable Accounting Standards have been followed and there has been no material departure;

- the Directors have selected such accounting policies, consulted and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of your Company as at 31 March 2011 and of the profit of your Company for the year on that date;

- the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act,1956 for safeguarding the assets of your Company and for preventing and detecting fraud and other irregularities;

- they have prepared the annual accounts for the financial year ended 31 March 2011 on a 'going concern' basis.

Auditors and Auditors' Report

M/s. Deloitte Haskins & Sells, Chartered Accountants and M/s Gandhi & Parekh, Chartered Accountants, Statutory Auditors of the Company, hold office until the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment.

The Company has received letters from the above named Auditors to the effect that their re-appointment, if made, would be within the prescribed limits under section 224 (1B) of the Companies Act, 1956 and that they have not disqualified for re- appointment within the meaning of the section 226 of the said Act.

The observations made in the Auditors' Report are self-explanatory and therefore, do not call for any further comments under section 217(3) of the Companies Act, 1956.

Cost Auditor

Pursuant to the directives of the Central Government under the provisions of Section 233B of the Companies Act, 1956 and subject to the approval of the Central Government, M/s B. J. D. Nanabhoy & Co., Cost Accountants, Mumbai have been appointed as Cost Auditors to conduct cost audit relating to the products manufactured by your Company.

Particulars of Employees

The information required on particulars of employees as per Section 217(2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975 forms part of this Report. As per the provisions of Section 219(1)(b)(iv) of the Companies Act, 1956, the Report and Accounts are being sent to all shareholders of your Company excluding the Statement of Particulars of Employees. Any shareholder interested in obtaining a copy of the said statement may write to your Company Secretary at the Corporate Office of your Company.

More details on the Human Resources function of your Company and its various activities are given in the 'Human Resources' and 'Sustainability' sections of the attached Management Discussion & Analysis.

Your Directors appreciate the significant contribution made by the employees to the operations of your Company during the year.

Conservation of Energy, Technology absorption, Foreign Exchange Earnings and Outgo

The particulars as prescribed under Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 are attached as Annexure A to this report.

Acknowledgements

On the occasion of completing 25 years, your Directors wish to place on record their deep sense of appreciation for all the stake holders of your company who have been continuously supporting the growth of your Company. In particular, the Directors value the dedication and commitment of your Company's employees and thank the Central and State Governments, Financial Institutions, Banks, Government authorities, customers, vendors and shareholders for their continued cooperation and support.

For and on behalf of the Board

Place: Mumbai Dilip B. Jiwrajka

Date: 29 July 2011 Managing Director


Mar 31, 2010

We have pleasure in presenting the 24 Annual Report of your Company together with the Audited Accounts for the financial year ended 31 March 2010. The summarized financial results (stand-alone and consolidated) are given below in Table 1.



Table 1: Financial Highlights: Stand-Alone and Consolidated

(Rs. Crore)

PARTICULARS Stand alone Consolidated

2009-10 2008-09 2009-10 2008-09

Sales / Job charges 4,311.17 2,976.93 4,424.34 3,090.78 (net of excise)

Other Income 64.02 20.81 66.63 45.96

Total Income 4,375.19 2,997.74 4490.97 3,136.74

Total Expenditure 3,102.71 2,175.13 3,259.18 2,322.29

Profit Before Interest, Depreciation & Taxes 1,272.48 822.61 1,231.79 814.45

Interest 535.08 304.12 578.90 341.03

Depreciation 362.61 233.50 366.92 240.15

Profit / (Loss) Before Tax 374.79 284.99 285.97 233.27

Provision For Taxation

- Current (63.56) (32.98) (65.94) (34.38)

- MAT Credit Entitlement 34.26 28.65 34.26 28.65

- Deferred (99.01) (89.80) (96.96) (88.48)

- Fringe Benefit Tax - (1.75) 0.02 (1.79)

- Excess / (Short) Provision Of Income Tax in respect of earlier years 0.86 (0.74) 0.46 (0.74)

Net Profit / (Loss) After Tax 247.34 188.37 157.81 136.53

Add: Share of Profit of Associates - - (20.74) (68.05)

(Add)/Less: Minority Interest - - 0.64 5.57

Profit After Tax after Minority Interest 247.34 188.37 137.71 74.05

Add: Balance brought forward 276.63 296.20 149.78 287.15

Balance Available for Appropriation 523.97 484.57 287.49 361.20

Add / (Less): Dividend for Earlier Years - (0.17) 0.15 (0.17)

Dividend : Equity 19.69 14.77 19.69 14.77

Tax on Dividend 3.27 2.51 3.27 2.51

Transfer to Debenture Redemption Reserve 300.10 190.83 296.63 194.30

Transfer to General Reserve 20.00 - 20.23 -

Balance Carried To Balance Sheet 180.91 276.63 (52.48) 149.78



Notes:



Previous years figures have been regrouped wherever necessary to bring them in line with the current years representation of figures

Performance

During the financial year, your Company recorded sales of Rs. 4,311.17 crore (increase of 44.82%) and profit before tax of Rs. 374.79 crore (increase of 31.51 %) over the previous year. Your Companys exports (including incentives) increased 47.84% — from Rs. 1,054.50 crore in 2008-09 to Rs. 1,558.99 crore during the year under review.

All the divisions of your company recorded growth . The sales performance of all the divisions of your Company, their share in the overall business and their growth over last year are reflected in Table 2 below.

PARTICULARS Total Sales for % to Total Total Sales for the year ended Sales the year ended 31 March 2010 31 March 2009

Cotton Yarn 327.10 7.59% 111.10

Apparel Fabric 1,942.73 45.06% 1,609.56

Home Textiles 707.26 16.41% 498.54

Garments 141.00 3.27% 138.58

Polyester Yarn 1,193.08 27.67% 619.15

Total 4,311.17 100.00% 2,976.93



PARTICULARS % to Total % Changes Sales

Cotton Yarn 3.73% 194.42%

Apparel Fabric 54.06% 20.70%

Home Textiles 16.75% 41.87%

Garments 4.66% 1.75%

Polyester Yarn 20.80% 92.70%

Total 100.00% 44.82%



Details of your Companys performance for the year under review are given in the Management Discussion and Analysis, which forms part of this Directors Report.

Dividend

Your Directors have recommended a dividend of Rs.0.25 per equity share of Rs.10/- each (previous year Rs.0.75 per share) for the financial year ended 31 March 2010 and seek your approval for the same. If approved, the total amount of dividend to be paid to the equity shareholders will be Rs. 19.69 crores (excluding tax of Rs.3.27 crores) as against Rs. 14.77 crore paid last year (excluding tax of Rs. 2.51 crore). Based on the above dividend payout (including dividend tax), the dividend payout ratio works out to 9.28% of Profit After Tax (PAT) as against 9.17% for 2008-09.

Capital

During the year under review, your Company allotted fresh equity shares as detailed below:

(Rs. Crore)

Sr. Details of Issue No. of shares Amount of Equity Premium No. held Issue Capital Amount Amount

1 Equity as at 1 April 196,974,969 196.97 596.96 2009

2 Issue of Shares on rights basis 408,723,061 449.59 408.72 40.87

3 Issue of Shares on QIP basis 182,100,248 424.66 182.10 242.56

Equity as at March 31 2010 787,798,278 787.79 880.39



Your Company, on 31 March 2009, announced a Rights Issue of 408,723,061 equity shares with a face value of Rs. 10/- each for cash at a price of Re. 11/- including premium of Re. 1/- aggregating to Rs. 449.59 crores to the existing shareholders of the Company on Right Issue basis in the ratio of 83 rights equity shares for every 40 equity shares held on the record date, i.e. 25 March 2009. The issue closed on 22 April 2009 and was oversubscribed 1.15 times. The allotment of Rights shares was made on 5th May 2009.

During the year, your Compnay also came out with a Qualified Institutional Placement (QIP) issue, wherein it allotted 182,100,248 equity shares of the face value of Rs. 10/- for cash at a premium of Rs.13.32 per share aggregating to Rs. 424.66 crore to Qualified Institutional Buyers. The issue was opened for subscription on 22 March 2010 and closed on 23 March 2010. The allotment of QIP shares was made on 30 March 2010. The proceeds of the QIP issue have been utilized towards long term working capital margin and normal capex requirements.

Consequent to the Rights Issue and the QIP, the Companys equity share capital as on 31 March 2010 stands at Rs. 787.79 crore (including 22,316 Rights Equity Shares, partly paid-up to the extent of Rs.5 per Equity Share), compared to Rs. 196.97 crore as on 31 March 2009.

Utilization of Rights Issue and QIP Proceeds

Rights Issue

(Rs. crores)

Particulars 29 July 2010 30 June 2009

Money Received 449.59 397.59

Utilized for Long Term Working Capital, General Corporate Purposes and Right Issue 449.59 397.59 expenses

QIP lssue (Rs. Crores)

Particulars 29 July 2010

Money Received 424.66

Utilized for Long Term Working Capital Margin, Normal capex requirements and Issue expenses 424.66

FCCBs

The 475 outstanding FCCBs of USD 50000 each aggregating to Rs. 107.21 crore as on 31 March 2010 have been redeemed on due date i.e. May 26, 2010.

Reserves

The balance available for appropriation as at 31 March 2010 amounted to Rs. 523.97 crores. After providing for dividend and dividend tax of Rs. 22.96 crore, your Company proposes to transfer Rs. 300.10 crore to Debenture Redemption Reserve and Rs. 20 crore to General Reserve. After providing for these, the balance of the Profit & Loss Account would stand at Rs. 180.91 crore.

During the year, a warrant holder holding warrants aggregating to Rs. 10.20 crores, representing 10,000,000 warrants of the face value of Rs. 10 each, had decided not to exercise the option of conversion. The company there fore forfeited the amount and transferred the same to Capital Reserve.

Consequent to the Rights issue and QIP issue, the Share Premium Account has increased during the year by Rs. 283.43 crore.

At the end of the financial year, the total reserves of the Company, stood at Rs. 1,928.40 crore. The corresponding figure at the end of the previous year was Rs. 1,410.39 crore.

Loans

During the year under review, your Company has raised incremental debt, both secured and unsecured, by way of rupee loans, foreign currency loans and non-convertible debentures aggregating to Rs.1913.33 crore for meeting capital expenditure and working capital requirements.

Capital Expenditure

During the year under review, your company incurred a capital expenditure of Rs. 1522.90 crore across various divisions. A major portion of these were towards Phase III and Phase IV expansions, which have been fully completed, setting up of second Continuous Polymerization (CP) Plant at Saily (Silvassa), expansion of Texturising and regular capex. Details of your Companys capacities across various divisions are provided under the head Capacity Expansion in the Management Discussion and Analysis annexed to this Report.

Subsidiary Companies and Consolidated Financial Statements

At the end of the financial year under review, your Company had the following subsidiaries:

Subsidiaries of Alok Industries Ltd.

1. Alok Industries International Ltd. ; (incorporated in the British Virgin Islands)

2. Alok International Inc. (incorporated in the state of Dallas,USA)

3. Alok Inc. (incorporated in the state of New York,USA)

4. Alok Infrastructure Limited

5. Alok H&A Limited

6. Alok Retail (India) Limited (Formerly known as Alok Homes & Apparel Private Limited)

7. Alok Apparels Private Limited

8. Alok Land Holdings Private Limited

Step-down subsidiaries of Alok Industries Limited

Parent Company Subsidiary %Holding

Alok Industries International Ltd Mileta, a.s.(incorporated in the Czech Republic) 93.20% holding

Alok European Retail, s.r.o. 75% holding

Alok Infrastructure Alok Realtors Private Limited 100% holding Limited

Alok HB Hotels Private Limited 100% holding

Alok HB Properties Limited 100% holding

Springdale Information and Technologies Private Limited 100% holding

Kesham Developers & Infotech Private Limited 100% holding

Alok Land Holdings Private Limited Alok Aurangabad Infratex Private Limited 100% holding

Alok New City Infratex Private Limited 100% holding



The Central Government has granted an exemption to your Company pursuant to Section 212(8) of the Companies Act, 1956 from attaching a copy of the Balance Sheet, Profit & Loss Account, Report of the Board of Directors and the Report of the Auditors of the subsidiary companies and hence the same have not been attached herein. These documents will be made available upon a written request by any member of the Company and / or any of its subsidiaries. Further, in line with the Listing Agreement and in accordance with the Accounting standards 21 (AS – 21) Consolidated Financial Statements, prepared by the Company include financial information of its subsidiaries. The Annual Accounts of the subsidiary companies and the related detailed information will be made available to the shareholder seeking such information at any point of time. The annual accounts of the Subsidiary Companies will also be kept for inspection by any shareholder at its registered / corporate office and that of the concerned subsidiary companies.

Shift in Registered Office

The Registered office of your Company has been shifted from B-43, Mittal Tower, Nariman Point, Mumbai 400 021 to 17/5/1, 521/1, Village Rakholi / Saily, Silvassa - 396230, Union Territory of Dadra and Nagar Haveli effective from 25 June, 2010 pursuant to an Order passed by the Company Law Board.

Business and Operations

The textile operations of your company are doing well and the long term prospects look promising, both for domestic and export markets. The consolidation of sourcing by global majors and shift in focus towards India to de-risk sourcing risk is the major driver for export growth. The growth in domestic demand is due to increase in per capita income as an outcome of GDP growth. With increased capacities across the value chain, your company is capitalizing on these opportunities as evidenced by increased operations and sales. Your company has also expanded its marketing initiatives across geographies which has resulted in a healthy order book apart from de-risking its business model. Your company is now consolidating its operations and focusing on more value added products like yarn dyed shirting and technical & work wear fabrics. The prospects for the polyester business also look quite encouraging.

The domestic cash and carry initiative of the company are carried out through a wholly owned subsidiary Alok H&A Ltd under the store brand “H&A which have started showing encouraging results. The company presently has 226 stores across India and expects to reach a total of 400 stores by end of March 2011. The stores are operated on franchisee basis thereby facilitating non-cash heavy expansion. The stores are targeted towards mass market with focus on Tier II and Tier III cities and the store area is also being increased to accommodate all product categories.

The overseas retail initiatives are carried out through Grabal Alok (UK) Ltd., which operates 212 stores across England, Scotland and Wales. The stores operate as value format stores offering a wide range of products under men, women, children, home and accessories categories. Originally branded as qs stores, they are now gradually being given a new brand identity Store Twenty One. A series of other measures such as shifting of sourcing to Asian countries, improving quality of merchandise, cost reduction initiatives have started showing positive results. The number of stores are being increased to further penetrate and capitalize on the new brand identity.

More details about your Companys business structure and initiatives are contained in the Management Discussion & Analysis.

Awards and Recognition

During the year under review, your Company has been given the following awards and recognitions by the Cotton Textile Exports Council of India (TEXPROCIL) in three categories:

Alok won the following awards from Texprocil:

- Gold Trophy for Highest Exports of Bleached / Dyed / Yarn Dyed / Printed Fabrics in Fabrics Category

- Gold Trophy for Highest Exports of Bed Linen / Bed Sheets / Quilts in Made-ups Category

- Silver Trophy for Highest Global Exports Category

Corporate Social Responsibility

Aloks Corporate Social Responsibility (CSR) philosophy is focused on growing the business while ensuring that the concerns of the environment in which it operates are adequately and sustainably addressed. This encompasses the natural environment, as well as the people and communities that live in the areas where the Company operates its businesses.

Details of your Companys Corporate Social Responsibility (CSR) initiatives are given in a separate section, Sustainability, which forms part of the accompanying Management Discussion and Analysis and Annual Report.

Corporate Governance

A separate report on Corporate Governance is enclosed as a part of this Annual Report. A certificate from the Statutory Auditors of your Company regarding compliance with Corporate Governance norms stipulated in Clause 49 of the Listing Agreement is also annexed to the report on Corporate Governance.

Fixed Deposits

Your Company does not have any fixed deposits under section 58A and 58AA of The Companies Act, 1956 read with Companies (Acceptance of Deposits) Rule, 1975.

Insurance

All the insurable interests of your Company including inventories, buildings, plant and machinery are adequately insured.

Directors

Mr. Ashok G. Rajani and Mr. K. R. Modi will retire from office by rotation at the ensuing Annual General Meeting and, being eligible, offer themselves for reappointment. Brief resumes of these Directors, in line with the stipulations of Clause 49 of the Listing Agreement, are provided elsewhere in this Annual Report.

During the year, Nomination of Mr. K. J. Punnathara, nominee of Life Insurance Corporation of India, was withdrawn w.e.f. 29 October 2009 and in his place Mrs. Thankom T. Mathew was appointed as LICs nominee. Nomination of Mrs. Hiroo S. Advani, nominee of Export Import Bank of India, was withdrawn w.e.f. 29 October 2009 and in her place Mr. David Rasquinha was appointed as EXIM Banks nominee. The Board wishes to place on record their appreciation for the contributions of Mr. K. J. Punnathara and Mrs. Hiroo S. Advani during their tenure as Directors of your Company.

Directors Responsibility Statement

As stipulated in Section 217(2AA) of the Companies Act, 1956, your Directors subscribe to the Directors Responsibility Statement and confirm that:

- In the preparation of the annual accounts for the financial year ended 31 March 2010, the applicable Accounting Standards have been followed and there has been no material departure;

- Appropriate accounting policies have been selected and applied consistently and such judgement and estimates have been made that were reasonable and prudent so as to give a true and fair view of the state of affairs of your Company as at 31 March 2010 and of the profit of your Company for the year on that date;

- The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act,1956 for safeguarding the assets of your Company and for preventing and detecting fraud and other irregularities;

- The Directors have prepared the annual accounts for the financial year ended 31 March 2010 on a going concern basis.

Auditors and Auditors Report

The observations made in the Auditors Report are self-explanatory and therefore, do not call for any further comments under section 217(3) of the Companies Act, 1956.

In view of the increase in overseas operations and requirement to follow IFRS Standards effective 2012, the company recommends the appointment of M/s Deloitte Haskins & Sells, Chartered Accountants as joint auditors with the present auditor M/s. Gandhi & Parekh, Chartered Accountants. M/s Deloitte Haskins & Sells, Chartered Accountants have indicated their willingness to accept this appointment.

The retiring Auditors M/s. Gandhi & Parekh, Chartered Accountants of your Company, are eligible for re-appointment and have indicated their willingness to accept re-appointment and be joint auditors with M/s Deloitte Haskins & Sells, Chartered Accountants. In terms of Section 224A of the Companies Act, 1956, the appointment of M/s Deloitte Haskins & Sells, Chartered Accountants and re-appointment M/s. Gandhi & Parekh Chartered Accountants needs to be approved by the members and their remuneration has to be fixed.

Cost Auditor

Pursuant to the directives of the Central Government under the provisions of Section 233B of the Companies Act, 1956 and subject to the approval of the Central Government, M/s B. J. D. Nanabhoy & Co., Cost Accountants, Mumbai have been appointed as Cost Auditors to conduct cost audit relating to the products manufactured by your Company.

Human Resources

The information required on particulars of employees as per Section 217(2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975 forms part of this Report. As per the provisions of Section 219(1)(b)(iv) of the Companies Act, 1956, the Report and Accounts are being sent to all shareholders of your Company excluding the Statement of Particulars of Employees. Any shareholder interested in obtaining a copy of the said statement may write to your Company Secretary at the Corporate Office of your Company.

More details on the Human Resources function of your Company and its various activities are given in the Human Resources and Sustainability sections of the attached Management Discussion & Analysis.

Your Directors appreciate the significant contribution made by the employees to the operations of your Company during the year

Conservation of Energy, Technology absorption, Foreign Exchange Earnings and Outgo

The particulars as prescribed under Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 are attached as Annexure A to this report.

Acknowledgements

Your Directors wish to place on record their appreciation of the dedication and commitment of your Companys employees to the growth of your Company. Your Directors wish to thank the Central and State Governments, Financial Institutions, Banks, Government authorities, customers, vendors and shareholders for their continued cooperation and support.

For and on behalf of the Board

Place: Mumbai Dilip B. Jiwrajka

Date: 29 July 2010 Managing Director