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Directors Report of Aro Granite Industries Ltd.

Mar 31, 2015

Dear Members,

The Directors' have pleasure in presenting the 27th Annual Report together with Audited Accounts of the Company for the year ended on 31st March 2015.

FINANCIAL RESULTS (Rs. in lacs)

31.03.2015 31.03.2014

Gross Profit before Depreciation 2755.11 3352.67

Depreciation 858.75 516.13

Net Profit before Tax 1896.36 2836.54

Provision for Tax - -

Current 738.47 743.84

- MAT Credit 336.43 148.26

- Deferred (174.53) 131.74

Surplus available for a ppropriation 1668.85 2109.22

Dividend (including Dividend Tax) 179.00 179.00

Amount transferred to General Reserve 200.00 200.00

Surplus carried to Balance Sheet 1289.85 1730.22

WORKING RESULTS

During the year the sales grew up by 1.6% to Rs 260.09 Crores from Rs 256.01 Crores in FY 2013-14. Net Profit of the company declined from Rs. 21.10 Cr last year to Rs. 16.69 Crores in FY2015. Last year the profits included the onetime gains from the divestment of Unit I and so adjusting for that profits grew by 15.83%.

The year started on a good note with demand reviving in our major exports markets. However the second half of the year was challenging due to Russia, which was a large market for us, was hit by sanctions last year due to Ukraine issue. That demand vanished and with the European countries also struggling to grow, the overall demand scenario has remained weak. The fall in Euro and Brazilian Currency also hit the competitiveness of the Indian granite industry.

We decided to invest in improving the overall operational efficiencies for the future. For this purpose we placed orders for 2 Mono wire, 1 Polishing line to replace the first polishing line which completed 15 years and a Gantry crane to Load and Unload blocks. These investments were done largely to de-bottleneck our existing capacity and the effect of these will be seen in the coming years.

We are also in the midst of constructing a new 110,000 Sqft (~ 11,000 sqm) Warehouse/Showroom, where we will be able to better display our inventory to customers who visit us. This will also help us streamline our Inventory Management Systems and Dispatch Systems which will be helped by introducing a new ERP (Enterprise Resource programming). All this should result in a better and quicker customer experience enhancing our clients overall satisfaction.

We have also planned to enter the highly Quality Conscious CUT-to-SIZE market where we will cut our random slabs to the size, dimensions and shapes to the custom orders of our clients. This will enable us to add more product ranges to our current portfolio (including Steps & Risers, Custom Counter tops, Window Sills, Larger Format Tiles etc). This should lead to a better rate of Raw material recovery. This project will kick off by January 2016.

DIVIDEND

Your Directors have recommended a dividend of Re. 1/- (i.e. 10%) per Equity Share of Rs. 10/- each (last year Re. 1/- per Equity Share) for the financial year ended 31st March 2015 amounting to Rs. 1,79,00,235/- (inclusive of tax of Rs. 26,00,235). The Dividend payout is subject to approval of members at the ensuing Annual General Meeting.

The dividend will be paid to the members whose names appear in the Register of Members as on September 11, 2015 and in respect of shares held in dematerialised forms, it will be paid to members whose names are furnished by National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL), as beneficial owners as on that date.

FIXED DEPOSIT

The Company has not accepted any fixed deposit from the public.

LOANS,GUARANTEES AND INVESTMENTS

The Company has not granted any Loan, Guarantees and made any investments during the year.

RELATED PARTY TRANSACTIONS

During the financial year ended 31st March 2015, company has not entered into any contracts or arrangement or transaction with related party. In view of above AOC-2 is not applicable. The Related Party Transactions Policy as approved by the Board is available on the website of the Company.

DIRECTORS

(i) Shri K. Raghavendra Acharya (DIN 06923476) was appointed as an Additional Director w.e f. 31.10.2014 and subsequently appointed as a Wholetime Director with designation of Executive Director of the Company with effect from 1st November 2014 for a period of three consecutive years subject to approval of the members at the ensuing Annual General Meeting.

(ii) Ms Vanita Sood (DIN 06926832) was appointed as an Additional Independent Director w.e f. 31.10.2014 subject to approval of the members at the ensuing Annual General Meeting.

(iii) Shri Kanwaljit Singh (DIN 01388140) was appointed as an Additional Independent Director w.e f. 25.04.2015 subject to approval of the members at the ensuing Annual General Meeting.

DIRECTORS' RESPONSIBILITY STATEMENT

As required under Section 134(3)(c) of the Companies Act, 2013, your Directors state that:-

(a) in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures;

(b) the accounting policies have been selected and applied consistently and judgments and estimates made 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 and loss of the Company for that period;

(c) proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the said Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(d) the annual accounts have been prepared on a going concern basis;

(e) the internal financial controls to be followed by the Company have been laid down and that such internal financial controls

are adequate and were operating effectively; and

(f) the proper systems to ensure compliance with the provisions of all applicable laws have been devised and that such systems were adequate and operating effectively.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

The Corporate Social Responsibility Committee has formulated and recommended to the Board, a Corporate Social Responsibility Policy(CSR Policy) indicating the activities to be undertaken by the Company which has been approved by the Board. The CSR policy may access from the website of the Company i.e www.arotile.com . The Annual Report on CSR activities is annexed herewith marked as Annexure I.

AUDITORS AND AUDITOR'S REPORT

(a) Statutory Auditors

M/s Alok Mittal & Associates, Chartered Accountants, Statutory Auditors of the Company, hold office till the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment. They have confirmed their eligibility to the effect that their re-appointment, if made, would be within the prescribed limits under the Act and that they are not disqualified for reappointment.

The Notes on the financial statements referred to in the Auditor's Report are self explanatory and do not call for any further comments. The Auditor's Report does not contain any qualification, reservations or adverse remark.

(b) Secretarial Auditor

The Board has appointed Ms Latika Jetley, Practising Company Secretary, (CP No. 3074) to conduct the Secretarial Audit for the Financial year 2014-15. The Secretarial Audit Report for the financial year 2014-15 is annexed herewith as Annexure II to this report. The Secretarial Audit Report does not contain any qualification, reservations or adverse remark.

(c) Internal Auditor

The Board has appointed M/s Sreekantha & Co., Chartered Accountants, Hosur as the Internal Auditor of the Company for the year 2014-2015.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS

During the period under review, there were no significant and material orders passed by the Regulators or courts or tribunals which would impact the going concern status of the Company and its future operations.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE

Additional information on conservation of energy, technology absorption, foreign exchange earnings and outgo as required as per the provisions of Companies Act 2013 and Rules thereunder is annexed hereto in Annexure III and forms part of this report.

EXTRACT OF THE ANNUAL RETURN

The Extract of annual return of the Company in form MGT 9 is annexed herewith as Annexure IV to this report.

PARTICULARS OF REMUNERATION

Statement of particulars of employee pursuant to the provisions of section 197 of the Companies Act, 2013 read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 for the year ended 31st March 2015.

Employed throughout the year ended 31st March in receipt of remuneration not less than Sixty Lakh rupees per annum.

Pursuant to the provisions of Section 197 (12) of the Companies Act, 2013 read with Rule 5 of companies (Appointment & Remuneration of Managerial Personnel) Rules, 2014, the details regarding the ratio of remuneration of each Director to the median employee's remuneration and such other details as required therein are as under:

1. The ratio of the remuneration of each director to the median remuneration of the employees of the Company for the financial year: The Board of Directors of the Company comprises of Non-executive Directors who does not draw any Remuneration form the Company except sitting fee.

SI. Name Ratio to median remuneration No.

1. Shri Sunil K Arora, Managing Director 777.749

2. Shri Kasturi Lal Arora 40.184

3. Shri Dinesh Chandra Kothari 2.222

4 Shri Rahul Gupta 4.074

5 Shri Pradeep Kumar Jain 3.889

6 Smt Sujata Arora 39.628

7 Shri K Raghavendra Acharya, Executive Director # 47.998

8 Smt Vanita Sood * 1.852

2. The percentage increase in remuneration of each Director, Chief Financial Officer, Company Secretary, in the financial year: The Board of Directors of the Company comprises of Non-executive Directors who does not draw any Remuneration form the Company except sitting fee.

SI. Name % Increase in Remuneration No.

1. Shri Sunil K Arora, Managing Director 5.00

2. Shri Kasturi Lal Arora -3.98

3. Shri Dinesh Chandra Kothari 100.00

4 Shri Rahul Gupta -8.33

5 Shri Pradeep Kumar Jain -12.50

6 Smt Sujata Arora 6.47

7 Shri K Raghavendra Acharya, Executive Director# 10.20

8 Smt Vanita Sood* 0.00

9 Shri Sabyasachi Panigrahi 10.20

# Joined the Board w.e.f. 31st October 2014 and appointed as the Executive Director w.e f 01.11.2014

* Joined the Board w.e.f. 31st October 2014.

3. The percentage increase in the median remuneration of employees in the financial year: 13.58

4. The number of permanent employees on the rolls of company: 134

5. The explanation on the relationship between average increase in remuneration and Company performance: The average increase in remuneration of employees is in line with the Company's performance. The average increase in remuneration of employees is 13.20 %. The average increase in Company's performance is 1.37 %.

6. Comparison of the Remuneration of the Key Managerial Personnel against the performance of the Company for the financial year 2014-15:

( in Lacs)

Aggregate remuneration of Key Managerial Personnel (KMP) 12.96

Revenue 25477.97

Remuneration of KMP (as % of revenue) 0.051

Profit Before Tax 1896.36

Remuneration of KMP (as % of PBT) 0.683

7. Variations in the market capitalization of the Company, price earning ratio as at the closing date of the current financial year and previous financial year:

Particulars 31st March 2015 31st March 2014 % Change

Market Capitalization (Rs. in Crores) 93.33 40.55 130.16

Price Earning Ratio 5.59 1.46 282.88

8. Percentage increase or decrease in the market quotations of the shares of the Company in comparison to the rate at which the Company came out with the last public offer:

Particulars 31st March 2015 9th January 1995 % Change

Market Price Rs. 61.00 Rs. 20.00 205

9. Average percentile increase already made in the salaries of employees other than the managerial personnel in the financial year ended 31st March 2015 was 13.20% and there was increase in managerial remuneration in the last financial year by 5.30%.

10. Comparison of each remuneration of the Key Managerial Personnel against the performance of the Company:

Shri Sabyasachi Panigrahi Company Secretary

Remuneration in FY 2014-15(Rs. in Crores) 0.1296

Revenue (Rs. in Crores) 254.7797

Remuneration as % of Revenue 0.0510

Profit before Tax (PBT) (Rs. in Crores) 18.9636

Remuneration as % of PBT 0.6830

11. No variable component of remuneration was availed by the directors during the financial year ended March 2015.

12. The ratio of the remuneration of the highest paid director to that of the employee who are not directors but receive remuneration in excess of the highest paid director during the year: Not applicable.

13. The Company affirms that the remuneration is as per the remuneration policy of the Company.

CORPORATE GOVERNANCE-including details pertaining to Board Meetings, Nomination and Remuneration Policy,Audit Committee and Vigil Mechanism

Your Company re-affirms its Commitment to the highest standards of corporate governance practices. Pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges, a Management Discussion and Analysis, Corporate Governance Report and Auditors Certificate regarding compliance of conditions of Corporate Governance are made a part of this Annual Report.

The Corporate Governance Report which forms part of this report also covers the following:

(a) Particulars of the Four Board Meetings held during the financial year under review.

(b) Policy on Nomination and Remuneration of Directors, Key Managerial Personnel and Senior Management.

(c ) The details with respect to composition of Audit Committee and establishment of Vigil mechanism.

INTERNAL FINANCIAL CONTROLS

The Company has in place adequate Internal financial controls with reference to financial statements and no material reportable weakness was observed in the system. Further ,the Company has in place adequate internal financial controls commensurate with the size and nature of its operations. The Company also has robust Budgetary Control System and Management Information System (MIS) which are backbone of the Company for ensuring that your Company's assets and interests are safeguarded.

LISTING

The Equity Shares of the Company are listed in Bombay Stock Exchange Limited and National Stock Exchange of India Limited. Listing fees for the year 2015-2016 have already been paid to The Bombay Stock Exchange Limited and National Stock Exchange of India Limited.

ACKNOWLEDGEMENT

Your Directors wish to thank and acknowledge the Banks, Government authorities, dealers, suppliers, business associates and the Company's valued Customers for their assistance and cooperation and the esteemed Shareholders for their continued trust and support. The Directors also wish to acknowledge the committee and dedicated team of Aro Granite whose unstinted work, efforts and ideas have taken the Company on a path of steady growth and development.

For and on behalf of the Board

Place: Hosur Sunil K Arora Sujata Arora Date: 25.04.2015 Managing Director Director


Mar 31, 2014

Dear Members,

The Directors'' have pleasure in presenting the 26th Annual Report together with Audited Accounts of the Company for the year ended on 31st March 2014.

FINANCIAL RESULTS

(Rs. in lacs) 31.03.2014 31.03.2013

Gross Profit before Depreciation 3352.67 1990.95

Depreciation 516.13 470.00

Net Profit before Tax 2836.54 1520.95

Provision for Tax –Current 743.84 380.01

– MAT Credit 148.26 75.38

– Deferred 131.74 90.39

Surplus available for appropriation 2109.22 1125.93

Dividend (including Dividend Tax) 179.01 118.54

Amount transferred to General Reserve 200.00 200.00

Surplus carried to Balance Sheet 1730.21 807.39

WORKING RESULTS

During the year the company has achieved a sales turnover of Rs. 253.55 Crores which is approximately 34.15% higher than the last year''s turnover of Rs. 189.01 Crores. At the same time the Company has posted a pre-tax profit of Rs. 28.37 Crores against a pre-tax profit of Rs. 15.21 Crores of the previous year.

The increase in turnover is the result of running of the full expanded capacity during the year and to some extent by the positive currency movement. Despite the fact that there has been an increase in raw material cost across our entire range of colours and increase in other input cost, we have been able to increase the profitability through better economies of scale. However the depreciation of the Indian Rupee against the US Dollar and Euro has resulted a further increase in costs as all our consumables are imported in Euro and most of the imported rough granite blocks in USD.

The consolidation process of the World economy is still underway. Currency movement was better during the year. We are optimistic that the scenario will continue to be positive during this year and we can achieve better results with the passing of time and with our sincere & dedicated efforts.

Availability of good quality rough granite blocks is still a critical area. Coming up of new granite processing units have made it more challenging. Procurement of Rough Blocks from Africa, Brazil, Norway, Finland and Ukraine still continuing.

By Adapting, Excelling and Exploring new avenues we intend to take the company to greater days in the coming years and to achieve this we solicit your sincere, dedicated and continued support to make 2014-15 a truly rewarding year.

DIVIDEND

Your Directors are pleased to recommend a dividend of 10% (Re. 1/- per Equity Share of Rs. 10/- each) for the year ended 31st March 2014 subject to the approval of the members at the Annual General Meeting

FIXED DEPOSIT

The Company has not accepted any fixed deposit from the public.

DIRECTORS

There was no change in the Directorship of the Company during the year.

AUDITORS

The Auditors of the company M/s Alok Mittal & Associates, Chartered Accountants retire and eligible for re-appointment. The observations of the Auditors in their Report on Accounts read with the relevant notes are self explanatory.

CORPORATE GOVERNANCE

Pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges, Management Discussion and Analysis, Report on Corporate Governance and Auditors'' Certificate regarding compliance of the conditions of Corporate Governance are made a part of this Annual Report.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to the requirement under section 217(2AA) of the Companies Act 1956 with respect to Directors'' Responsibility Statement, it is hereby confirmed that:

i) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures in financial statements;

ii) the directors had selected such accounting policies 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 the company at the end of the financial year and of the profit or loss of the company for that period;

iii) 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) the directors had prepared the annual accounts on a going concern basis.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE

Additional information on conservation of energy, technology absorption, foreign exchange earnings and outgo as required in terms of Section 217(1) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 is annexed hereto and forms part of this report.

PERSONNEL

Information in accordance with the provisions of Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 regarding employees is given in annexure to the directors'' Report

LISTING

The Equity Shares of the Company are listed in Bombay Stock Exchange Limited and National Stock Exchange of India Limited. Listing fees for the year 2014-2015 have already been paid to The Bombay Stock Exchange Limited and National Stock Exchange of India Limited.

ACKNOWLEDGEMENT

Your Directors wish to thank and acknowledge the Banks, Government authorities, dealers, suppliers, business associates and the Company''s valued Customers for their assistance and cooperation and the esteemed Shareholders for their continued trust and support. The Directors also wish to acknowledge the committee and dedicated team of Aro Granite whose unstinted work, efforts and ideas have taken the Company on a path of steady growth and development.

For and on behalf of the Board

Place: Hosur Sunil K Arora K L Arora Date: 19.04.2014 Managing Director Director


Mar 31, 2013

The Directors'' have pleasure in presenting the 25th Annual Report together with Audited Accounts of the Company for the year ended on 31st March 2013.

FINANCIAL RESULTS

(Rs. in lacs)

31.03.2013 31.03.2012

Gross Profit before Depreciation 1990.95 1605.42

Depreciation 470.00 417.84

Net Profit before Tax 1520.95 1187.58

Provision for Tax - Current 380.01 318.00

- MAT Credit 75.38 79.95

- Deferred 90.39 71.66

Surplus available for appropriation 1125.93 877.87

Dividend (including Dividend Tax) 118.54 118.55

Amount transferred to General Reserve 200.00 200.00

Surplus carried to Balance Sheet 7953.99 7142.66

WORKING RESULTS

During the year the company has achieved a sales turnover of Rs. 187.26 Crores which is approximately 17.60% higher than the last year''s turnover of Rs. 159.21 Crores. At the same time the Company has posted a pre-tax profit of Rs. 15.21 Crores against a pre-tax profit of Rs. 11.88 Crores of the previous year.

The expansion programme undertaken by the Company for the addition of 4 gang-saws (taking the total to 12 gang-saws) along with other allied machines has been completed and the commercial production has started in the third quarter of the fiscal. This has resulted in the increased turnover, pre-tax profit and overall profitability of the Company.

The sign of the recovery in the World economy did not crystallize to the extent expected but was better than the scenario of the previous years. Slowly the world market is coming out of the recessional impact and well documented euro zone crisis. We are optimistic that the scenario will change positively during this year.

The quality of rough granite blocks available from the domestic quarries is still an issue. Another factor which has contributed to this problem is closing down of large number of quarries in the State of Tamil Nadu leading to an acute shortage of good quality blocks thereby resulting in increase of prices of the available granite blocks. The company is continuing to import rough granite blocks from South Africa, Brazil, Finland, Madagascar, Spain and Norway to augment the supply of raw materials to meet its requirements.

We are also proud to announce that we are the first Indian Granite company to be awarded with the Integrated Management Systems (IMS) Certificate which include QMS 9001:2008, EMS 14001:2004, and OHSAS 18001:2007 from TUV Nord, Germany.

DIVIDEND Your Directors are pleased to recommend a dividend of 10% (Re. 1/- per Equity Share of Rs. 10/- each) for the year ended 31st March 2013 subject to the approval of the members at the Annual General Meeting

FIXED DEPOSIT

The Company has not accepted any fixed deposit from the public.

DIRECTORS

There was no change in the Directorship of the Company during the year.

AUDITORS

The Auditors of the company M/s Alok Mittal & Associates, Chartered Accountants retire and eligible for re-appointment. The observations of the Auditors in their Report on Accounts read with the relevant notes are self explanatory.

CORPORATE GOVERNANCE

Pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges, Management Discussion and Analysis, Report on Corporate Governance and Auditors'' Certificate regarding compliance of the conditions of Corporate Governance are made a part of this Annual Report.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to the requirement under section 217(2AA) of the Companies Act 1956 with respect to Directors'' Responsibility Statement, it is hereby confirmed that:

i) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures in financial statements;

ii) 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 for that period;

iii) 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) the directors had prepared the annual accounts on a going concern basis.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE

Additional information on conservation of energy, technology absorption, foreign exchange earnings and outgo as required in terms of Section 217(1) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 is annexed hereto and forms part of this report.

PERSONNEL Information in accordance with the provisions of Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 regarding employees is given in annexure to the directors'' Report

LISTING

The Equity Shares of the Company are listed in Bombay Stock Exchange Limited and National Stock Exchange of India Limited. Listing fees for the year 2013-2014 have already been paid to The Bombay Stock Exchange Limited and National Stock Exchange of India Limited.

ACKNOWLEDGEMENT

Your Directors wish to thank and acknowledge the Banks, Government authorities, dealers, suppliers, business associates and the Company''s valued Customers for their assistance and cooperation and the esteemed Shareholders for their continued trust and support. The Directors also wish to acknowledge the committee and dedicated team of Aro Granite whose unstinted work, efforts and ideas have taken the Company on a path of steady growth and development.

For and on behalf of the Board

Place: Hosur Sunil K Arora K L Arora

Date: 19.04.2013 Managing Director Director


Mar 31, 2012

The Directors' have pleasure in presenting the 24th Annual Report together with Audited Accounts of the Company for the year ended on 31st March 2012.

FINANCIAL RESULTS (Rs. in lacs)

31.03.2012 31.03.2011

Gross Profit before Depreciation 1605.42 1687.03

Depreciation 417.84 439.79

Net Profit before Tax 1187.58 1247.24

Provision for Tax - Current 318.00 270.17

- MAT Credit 79.95 _

- Deferred 71.66 27.64

Surplus available for appropriation 877.87 949.42

Dividend (including Dividend Tax) 118.55 118.94

Amount transferred to General Reserve 200.00 200.00

Surplus carried to Balance Sheet 7142.66 6583.34 WORKING RESULTS

During the year the company has achieved a sales turnover of Rs. 159.21 Crores which is approximately 6% higher than the last year's turnover of Rs. 150.23 Crores. At the same time the Company has posted a pre-tax profit of Rs. 11.88 Crores against a pre-tax profit of Rs. 12.47 Crores of the previous year.

The marginal decrease in the pre-tax profit is because of increase in raw material cost, interest costs, freight and other operating expenses. The company has had to increase the use of generators as there is a power shortage in Tamil Nadu which resulted in loss of production and an increased running cost. Though the Company has been able to achieve higher sales than last year, the profit has reduced marginally because of these facts.

The sign of the recovery in the North American economy, felt during the start of the last fiscal, did not crystallize to the extent expected but was better than the scenario the previous year. Still slowly the world market is coming out of the recessional impact thus leading to ' the current and well documented euro zone crisis. We are optimistic that the scenario will change positively during this year and are putting more efforts into gaining a larger market share.

The quality of rough granite blocks available from the domestic quarries has deteriorated even further as compared to last financial year and we could get mostly second choice blocks than the premium quality blocks. There is also blatant increase of raw material prices due to the shortage of good material and the entry of new companies into the industry. The company is continuing to import rough granite blocks from South Africa, Brazil, Finland, Madagascar, Spain and Norway to augment the supply of raw materials to meet its requirements. Further the company has also started importing unpolished granite slabs from Saudi Arabia to cater to the requirements of its esteemed Customers. We have also taken up purchasing of finished goods from Ongole as those factories are able to process granites from nearby quarries and the transport cost from Andhra Pradesh has become exorbitant.

The company has also entered into the final stage of adding a further 4 gang-saws (12 gang-saws in total) along with other required machines and the refurbishment of unit one in the hopes that US market will regain strength. Despite the Euro crisis your company has already entered into new markets like Greece, Portugal and Iran. This expansion will allow your company to enter into even more untapped markets.

The process of implementing Integrated Management Systems (IMS) which include QMS 9001:2008, EMS 14001:2004, OHSAS 18001:2007 and SA 8000 is progressing rapidly and during the year 2012-13 the certification is likely to be completed. The Company's products if Slabs for Cladding, Slabs for floors and stairs and Modular tiles have been awarded CE Certification by TUV Nord India for a period of 10 years.

DIVIDEND

Your Directors are pleased to recommend a dividend of 10% (Re. 1/- per Equity Share of Rs. 10/- each) for the year ended 31st March 2012 subject to the approval of the members at the Annual General Meeting.

FIXED DEPOSIT

The Company has not accepted any fixed deposit from the public.

DIRECTORS

There was no change in the Directorship of the Company during the year.

AUDITORS

The Auditors of the company M/s Alok Mittal & Associates, Chartered Accountants retire and eligible for re-appointment. The observations of the Auditors in their Report on Accounts read with the relevant notes are self explanatory.

CORPORATE GOVERNANCE

Pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges, Management Discussion and Analysis, Report on Corporate Governance and Auditors' Certificate regarding compliance of the conditions of Corporate Governance are made a part of this Annual Report.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the requirement under section 217(2AA) of the Companies Act 1956 with respect to Directors' Responsibility Statement, it is hereby confirmed that:

i) In the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures in financial statements;

ii) 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 for that period;

iii) 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) The directors had prepared the annual accounts on a going concern basis.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE

Additional information on conservation of energy, technology absorption, foreign exchange earnings and outgo as required in terms of Section 217(1) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 is annexed hereto and forms part of this report.

PERSONNEL

Information in accordance with the provisions of Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 regarding employees is given in annexure to the Directors' Report

LISTING

The Equity Shares of the Company are listed in Bombay Stock Exchange Limited and National Stock Exchange of India Limited. Listing fees for the year 2012-2013 have already been paid to The Bombay Stock Exchange Limited and National Stock Exchange of India Limited.

ACKNOWLEDGEMENT

Your Directors wish to thank and acknowledge the Banks, Government authorities, dealers, suppliers, business associates and the Company's valued Customers for their assistance and cooperation and the esteemed Shareholders for their continued trust and support. The Directors also wish to acknowledge the committee and dedicated team of Aro Granite whose unstinted work, efforts and ideas have taken the Company on a path of steady growth and development.

For and on behalf of the Board

Place: Hosur Sunil K Arora Sujata Arora

Date: 14.04.2012 Managing Director Director


Mar 31, 2011

Dear Members,

The Directors have pleasure in presenting the 23rd Annual Report together with Audited Accounts of the Company for the year ended on 31st March 2011.

FINANCIAL RESULTS

(Rs.in lacs) 31.03.2011 31.03.2010

Gross Profit before Depreciation 1690.60 1815.11

Depreciation 439.79 430.48

Net Profit before Tax 1250.81 1384.63

Provision for Tax - Current 271.51 236.25

- Deferred 27.64 83.69

- Others 2.23 0.73

Surplus available for appropriation 949.42 1063.97

Dividend (including Dividend Tax) 118.94 121.22

Amount transferred to General Reserve 200.00 200.00

Surplus carried to Balance Sheet 6583.34 5952.86

WORKING RESULTS

During the year the company has achieved a sales growth of around 15% over last year. The sales turnover for the year ended March 2011 was Rs. 151.39 Crores against a sales turnover of Rs. 131.99 cores for the year ended March 2010. At the same time the Company has posted a pre-tax profit of Rs. 12.51 Crores against a pre-tax profit of Rs. 13.85 Crores of the previous year.

Though the Company has been able to achieve a higher sales than last year, the increase in raw material cost, freight and other operating expenses has dented the profit and has resulted in lower Pre-tax Profit. The sign of the recovery in the world economy, felt during the start of the last fiscal, did not crystallize fully and still slowly the world market is coming out of the recessional impact thus leading to the Indian Rupee becoming stronger as compared to the US Dollar. We are optimistic that the scenario will change positively during this year and we can achieve better results with the passing of time and with our sincere & dedicated efforts.

The quality of rough granite blocks available from the domestic quarries has deteriorated as compared to last financial year and we could get mostly second choice blocks than the premium quality blocks. The company is continuing to import rough granite blocks from South Africa, Brazil, Finland, Madagascar and Norway to augment the supply of raw materials to meet its requirements. Further the company has also started importing unpolished granite slabs from Saudi Arabia to cater to the requirements of its esteemed Customers.

The Board is pleased to inform that during the year the Company has received Special Export Award from CAPEXIL for the year 2009-10 which is the tenth year running the Company got this award. Also the process of implementing Integrated Management Systems (IMS) which include QMS 9001:2008, EMS 14001:2004, OHSAS 18001:2007 and SA 8000 is progressing rapidly and during the year 2011-12 the certification is likely to be completed. The Company has also initiated the process of CE Marking for its products which too is likely to be completed in the coming Year.

DIVIDEND

Your Directors are pleased to recommend a dividend of 10% (Re. 1/- per Equity Share of Rs. 10/- each) for the year ended 31st March 2011 subject to the approval of the members at the Annual General Meeting.

FIXED DEPOSIT

The Company has not accepted any fixed deposit from the public.

DIRECTORS

During the year Shri Sundareshwara G Sastry resigned from the Board of the Company. The Board place on record its appreciation for the valuable services rendered by him during his tenure.

AUDITORS

The Auditors of the Company M/s Alok Mittal & Associates, Chartered Accountants retire and eligible for re-appointment. The observation of the Auditors in their Report on Accounts read with the elevant notes are self explanatory.

CORPORATE GOVERNANCE

Pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges, Management Discussion and Analysis, Report on Corporate Governance and Auditors' Certificate regarding compliance of the conditions of Corporate Governance are made a part of this Annual Report.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the requirement under section 217(2AA) of the Companies Act 1956 with respect to Directors' Responsibility Statement, it is hereby confirmed that:

i) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures in financial statements;

ii) the directors had selected such accounting policies 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 the company at the end of the financial year and of the profit or loss of the company for that period;

iii) 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) the directors had prepared the annual accounts on a going concern basis.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE

Additional information on conservation of energy, technology absorption, foreign exchange earnings and outgo as required in terms of Section 217(1) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 is annexed hereto and forms part of this report.

PERSONNEL

Information in accordance with the provisions of Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 regarding employees is given in annexure to the Directors' Report.

LISTING

The Equity Shares of the Company are listed in Bombay Stock Exchange Limited and National Stock Exchange of India Limited. Listing fees for the year 2011-2012 have already been paid to The Bombay Stock Exchange Limited and National Stock Exchange of India Limited.

ACKNOWLEDGEMENT

Your Directors wish to thank and acknowledge the Banks, Government authorities, dealers, suppliers, business associates and the Company's valued customers for their assistance and cooperation and the esteemed Shareholders for their continued trust and support. The Directors also wish to acknowledge the committee and dedicated team of Aro Granite whose unstined hard work, efforts and ideas have taken the Company on a path of steady growth and development.

For and on behalf of the Board

Sunil K Arora Kasturi Lal Arora Managing Director Director

Place : New Delhi Date : 22.04.2011




Mar 31, 2010

We are delighted to present our 22nd Annual Report together with Audited Statements of Accounts of the Company for the year ended on 31st March 2010.

FINANCIAL RESULTS

(Rs. in lacs)

31.03.2010 31.03.2009

Gross Profit before Depreciation 1815.11 1847.13

Depreciation 430.48 427.99

Net Profit before Tax 1384.63 1419.14

Provision for Tax - Current 236.25 161.58

- Deferred 83.69 47.27

- Others 0.73 11.99

Surplus available for appropriation 1063.97 1198.28

Dividend (including Dividend Tax) 121.22 129.67

Amount transferred to General Reserve 200.00 200.00

Amount carried over 5952.86 5210.10

WORKING RESULTS

The year under consideration was ended with a positive note for the Company with a sales growth of around 13%. During the year the Company has achieved a turnover of Rs. 131.99 Crores, an increase of approximately 13% over previous years turnover of Rs. 117.10 Crores. At the same time the Company has posted a pre-tax profit of Rs. 13.85 Crores against a pre-tax profit of Rs. 14.19 Crores of the previous year, a marginal decrease of approximately 2.40%. Despite the continued slowdown in global market because of recession in global economy, the Company has been able to achieve a satisfactory result during the year. Though there is a sign of the recovery in the world economy and the world market is coming out of the recessional impact, still the operations are under pressure. We hope we will be able to overcome the same with passing of time and with our sincere & dedicated efforts.

The availability of Rough Blocks from the domestic quarries has improved as compared to last financial year since new quarries have started operations. The company is continuing to import Rough Blocks from South Africa, Norway, Finland and Brazil to augment the supply of raw materials to meet its requirements.

The Board is pleased to inform that during the year, the Company, for the ninth time, has received Special Export Award from CAPEXIL for the year 2008-09. Further the company was recognized as Star Export House during the Year. Also the Company has already initiated the process of implementing Integrated Management Systems (IMS) which includes QMS 9001:2008, EMS 14001:2004, OHSAS 18001:2007 and SA 8000 . The Company has already achieved upgradation to ISO 9001:2008 standards.

DIVIDEND

Your Directors are pleased to recommend a dividend of 10% (Re. 1/- per Equity Share of Rs. 10/- each) for the year ended 31" March 2010 subject to the approval of the members at the Annual General Meeting. The register of members and share transfer register shall remain closed from 24.07.2010 to 29.07.2010 (both days inclusive) for the purpose of AGM and for payment of dividend.

FIXED DEPOSIT

The Company has not accepted any fixed deposit from the public.

DIRECTORS

Sh. Pradeep Kumar Jain was appointed as an Additional Director with effect from 24.04.2010. The term of his office expires at the forthcoming Annual General Meeting Company and for his re-appointment the Company has received notice prusuant to Section 257 to the Companies Act, 1956 from a member, proposing his candidature for the office of Director of the Company whose period of office will be liable to determination by retirement by rotation.

AUDITORS

The Auditors of the company M/S Alok Mittal & Associates, Chartered Accountants retire at the conclusion of the ensuing Annual General Meeting of the Company and being eligible offer themselves for reappointment.

CORPORATE GOVERNANCE

Pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges, Management Discussion and Analysis, Report on Corporate Governance and Auditors Certificate regarding compliance of the conditions of Corporate Governance are made a part of this Annual Report.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirement under section 217(2AA)of the Companies Act 1956 with respect to Directors Responsibility Statement, it is hereby confirmed that:

i) in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

ii) the directors had selected such accounting policies 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 the company at the end of the financial year and of the profit or loss of the company for that period;

iii) 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) the directors had prepared the annual accounts on a going concern basis.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE

Additional information on conservation of energy, technology absorption, foreign exchange earnings and outgo as required in terms of Section 217(1) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 is annexed hereto and forms part of this report.

PERSONNEL

The Industrial relation throughout the year was smooth. Your Directors are pleased to place on record their appreciation for contribution made by the employees at all levels in achieving the objectives of the company. The Statement of particulars of employees as per sub- section (2A) of section 217 of the Companies Act 1956 read with Companies (Particulars of Employees) Rules 1975, for the year ended 31st March 2010 is annexed hereto and form part of the Report.

LISTING

The Equity Shares of the Company are listed in Bombay Stock Exchange Limited and National Stock Exchange of India Limited. Listing fees for the year 2010-2011 have already been paid to The Bombay Stock Exchange Limited and National Stock Exchange of India Limited.

ACKNOWLEDGEMENT

Your Board wishes to place on record its sincere thanks to all the customers, suppliers, bankers for extending support to your Company. Board in specific wishes to place on record sincere appreciation of the contribution made by all its employees with commitment, towards the growth of your Company.

For and on behalf of the Board

Place: New Delhi Sunil K Arora Kasturi Lal Arora

Date: 24.04.2010 Managing Director Director

 
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