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Directors Report of Diamond Power Infrastructure Ltd.

Mar 31, 2014

The Members,

The Directors are pleased to present the Twenty Second Annual Report together with the Audited accounts of the Company for the year ended on 31st March, 2014.

FINANCIAL RESULTS

Rs. in Lacs

2013-14 2012-13

Income 268088.01 213274.84

Expenditure 241202.01 190741.24

Gross Profit / (Loss) before Interest, Depreciation & Tax 26886.00 22533.60

Interest 11179.79 8560.43

Depreciation 3509.34 3265.41

Profit before Tax 12196.87 10707.76

Provision for taxation / Deferred Tax 1800.00 1500.00

Profit after tax 10396.87 9207.76

Share Capital 5814.20 3720.64

Reserves & Surplus 87547.35 65647.17

EPS 23.29 24.75

IMPORTANT PERFORMANCE PARAMETERS

Rs. in Lacs

2013-14 2012-13

Gross Profit Margin (%) 10.02 10.56

Asset Turnover (times) 1.03 1.10

Interest Coverage (times) 2.40 2.63

Earning per Shares (diluted) (Rs.) 23.29 24.75

DIVIDEND

Looking into the long term interest of the Company, your Directors have not recommended any dividend for the financial year ended on 31st March, 2014, although the Company has earned profit in the year under review.

CURRENT ACTIVITIES OF THE COMPANIES

At present your Company is generating revenues from Cables, Conductors, Transformers, Transmission and EPC Contracts. Company provides to its customers, numerous ranges of products in terms of best quality and ensures them optimum satisfaction level. We are glad to give you a brief look on the wide array of product range offered by our Company:

CABLES

Our power cables transmit a reassuring quality that can be counted on at all times. Our range includes the highly reliable LV/HV cables from 1.1KV to 132KV and the EHV cables from 220KV to 550KV. In order to deliver world-class power transmission products, we leverage our CCV method of manufacturing, coupled with German technology. What''s more, we also offer a 10-year warranty on our products against manufacturing defects - a first of its kind assurance that helps build the client''s confidence and trust in our products.

Power and Control Cables include

LV(1.1KV) grade aluminium/copper, armoured/unarmoured,

PVC/FRLS/XLPE cables up to 1000 sq mm in single core and 630 sq mm in multi core that conform to IS1554-I, IS 7098-I and other international standards Copper control cables up to 61 core with PVC/XLPE/FRLS that conform to international standards and specifications 4 HV cables up to 132KV as per international specifications and standards EHV cables from 220KV to 550KV Aerial Bunch Cables (ABC), both in LV & HV grade that conform to various standards Specialty cables which include control & instrumentation cables PVC / XLPE insulated ACSR & AAA conductors for special purposes Flexible cables with single core and multi core that conform to international standards and BS specifications.

Production Capacities

Our key equipment suppliers include global leaders such as Scholz, Nokia-Maillefer and Supermac among others. Amongst the top five power cable manufacturers in India, Diamond Power has also established India''s first ''vertical lead extrusion facility as well as the ''aluminium extrusion facility'' for cables, ranging from 66KV and more. Our cable capacities include:

LV cables (1.1KV) : 34300 KMPA HV cables (up to 132KV) : 5600 KMPA

EHV cables (220KV & above) : 2000 KMPA

Approvals, Certifications and Testing

ISO 9001-2008 Certified Products type-tested at ERDA and CPRI 4~ BIS certification for all LV / HV cables, conductors Products approved and accepted by leading electrical consultants, EPC contractors and corporate houses Products approved by most of the power utilities viz.

Powergrid, NTPC, NHPC and State Electricity Boards In addition to the above wider range of Cables, your Company took toddler steps to enter into the market of flexible wires, multi core cables, and special instrumentation and automation cables for domestic and industrial purpose with the brand name of "DIATRON". DIATRON Flame Retardant Cables are made of Electrolytic grade, bright plain annealed copper conductor, as per IS: 8130- 1984. These cables are suitable for all Industrial & Domestic wiring applications. The cables have high oxygen and temperature index and insulation of Flame Retardant- FR PVC compound, giving it additional safety. The cables have twin coating giving it superior insulation. Further the wires have uniform diameter and are available in standard lengths.

DIATRON flexible wires are made of bright, plain multi-stranded annealed copper conductor, as per Class 5 of IS 8130: 1984 with PVC insulation. These wires are used for all industrial wiring applications and are available in single and multi cores in standard lengths.

CONDUCTORS

Proficient Range of Conductors

Our range of conductors has been designed for superior efficiency and performance. Conductor manufacturing has been Diamond Power''s core competency since inception; it has today evolved into the country''s second largest player with a market share of over 25% and an installed capacity of over 50,500 MT. The product range comprises of 7 strand to 91 strand from 11KV HVDC lines. Diamond Power has supplied more than 1 million KMs of conductors.

Our Transmission and Distribution Conductors include 4 Aluminium Alloy Conductor Steel Reinforced (AACSR)

All Aluminium Conductors (AAC)

All Aluminium Alloy Conductors (AAAC)

Aluminium Conductor Steel Reinforced (ACSR)

Aluminium Conductor Alloy Reinforced (ACAR)

High Conductivity Alloy Conductors AL-59 etc Production Capacities Installed capacity of over 50,500 MTPA 4 Annual capacity of over 80,000 KMPA Approvals, Certifications and Testing ISO 9001-2008 certified

Products are type-tested at ERDA, NETFA, TAG and CPRI India''s first plant with in-house alloy manufacturing capabilities with type- testing facilities for rods Products approved with Powergrid, NTPC, NHPC and SEB''s

First in India to develop and manufacture alloy conductors and proto-test HSHC (High Strength and High Conductivity) conductors

First BIS mark holder for alloy conductors in India having ISI licenses for all types of conductors Product Awards

Winner of the International Gold Star Award & Quality Award from BID Spain transformers

Power and Distribution Transformers

Diamond Power''s Transformer division has been formed with the takeover of Western Transformers. This merger brings in over decades of manufacturing and technical excellence. To further fuel growth in the division, fresh investments in technology, capabilities and capacities have been made. Our transformer range comprises of state-of-the-art power, distribution and dry-type transformers.

It includes 11KV to 220KV, all the way up to 315MVA. Each of our transformers undergoes stringent type-testing, ensuring higher efficiency as well as reliability. We have successfully manufactured and type-tested transformers with ratings starting from 10 KV to 315 MVA, up to 220 KV class.

Power & Distribution Transformers include:

Power Transformers up to 220KV, 315 MVA Distribution Transformers up to 33KV, 2500 KVA Single phase track side transformers up to 145KV, 10 MVA Single phase track side transformers up to 145KV, 31 MVA Cast resin transformers up to 36KV, 3150KVA Current transformers up to 245KV Voltage transformers up to 72.5KV Vacuum circuit breakers up to 36KV, 2500 A, 40KA Dry type transformers Production facilities and Approvals:

Three fully-integrated facilities in Gujarat with in-house facilities for products such as core laminations, wire drawing, strip mill, winding as well as an in-house transformer oil refinery

A world class dry-type transformer facility

Over 50,000 installed transformers worldwide and an annual production capacity of 5000 transformers approvals, certifications and testing:

Our type-testing facilities of up to 1000 KV have been installed with a view to cover anticipated increased needs in the future Over 500 type-tests of several sizes done in laboratories all over the world

Our R&D facilities have been certified by DSIR, Govt. of India and ISO 9001-2008

TRANSMISSION TOWERS

A Tough Range of Transmission Towers

Our Transmission Towers have been designed to withstand the roughest of weathers. Sturdily built and technically superior in quality, these towers can perform in the most demanding of conditions. Not surprisingly, Diamond Power''s Transmission Towers are empowering every corner of the country by delivering power efficiently and reliably. Diamond Power, India''s most diversified power T&D Company has commenced production at its transmission tower facility.

Product Facilities

Our state-of-the-art facility is located at Phase II, Village: Vadadala, Taluka: Savli, Dist.: Vadodara. It has been designed to manufacture a wide range of transmission towers with a capacity of 48,000 MTPA.

TURNKEY PROJECTS

Our turnkey services in the power T&D sector are the key to our growth. We not only conceptualize the project, but also take charge of various stages of the project including planning, design and development, procurement, right up to the erection and commissioning. This has made us the country''s largest integrated power solutions provider. With our vast product range, we have an in-house control over 80% of the average EPC project cost.

Overhead Transmission Lines

One of our core focus areas is high voltage and extra high voltage transmission line projects. Our technical capabilities, financial viability and superior execution skills ensure a cutting-edge project development and implementation.

Rural & urban distribution Projects

Our solutions also encompass rural and urban electrification and distribution projects; wherein we offer end-to-end services - right from project design to commissioning.

Substation Projects

Diamond Power also undertakes MV, HV and EHV substation projects. Here again, our technical, financial and managerial process allows us to configure a project that fulfils client demands.

FINANCIAL STATEMENTS

The financial statements of your Company for the year ended on 31st March, 2014 have been prepared in accordance with the provisions of laws accordingly, and the previous year''s figures have been reclassified / regrouped to confirm to this year''s classification.

Your Directors have attached the Consolidated Financial Statements pursuant to Clause 32 of the Listing Agreement entered into with the Stock Exchanges and prepared in accordance with the Accounting Standards prescribed by the Institute of Chartered Accountants of India, in this regard.

SUBSIDIARY COMPANIES

M/s. Diamond Power Transformers Limited and M/s. Diamond Power Global Holdings Limited are wholly owned subsidiaries of our company.

Diamond Power Transformers Limited

Diamond Power Transformers Limited has performed well and has achieved tremendous growth in turnover. The Company is one of the core suppliers of transformers to the clients like BHEL, Noida Power, and Electricity Boards etc. The Company expects to achieve higher growth with addition of varied size and rating of transformers.

The Accounts of M/s. Diamond Power Transformers Ltd, Wholly Owned Subsidiary Company, together with the reports of the Directors and the auditors, are attached with this Annual Report.

Diamond Power Global Holdings Limited

Diamond Power Global Holdings Limited was incorporated on 3rd November, 2011 as a 100% subsidiary of Diamond Power Infrastructure Limited in Jebel Ali Free Zone (JAFZA), Dubai, U.A.E. to promote exports of the Company in the Middle East.

Financial numbers for Diamond Power Global Holding Limited are already included in the annual accounts of the Company.

DIRECTORS

In accordance with the provisions of Section 149 of the Companies Act, 2013 and Articles of Association of the Company, your Board of Directors are seeking the re-appointment of Shri Ashok Kumar Gautam, Shri Ashok Kumar Singh and Shri Bhavin Shah who are retiring at the ensuing Annual General Meeting.

Profile of all the Directors has been given in the Explanatory Statement to the Notice of the ensuing Annual General Meeting of the Company.

Further during the year following Directors were retired and appointed:

Smt. Dr. vasantha Bharucha

Smt. Dr. Vasantha Bharucha joined our Company on 28th September, 2010 as a Non-Executive Director. Due to her pre-occupation she opted for retirement from the Board of Directors and conveys her resignation on 22nd May, 2013. Dr. Bharucha served as a Chairman of the Investors'' Grievances Committee and Member of Audit Committee and Remuneration Committee. The Company has been able to nail down many opportunities that have come its way with the help of her suggestions and guidance. The Management would like to extend its gratitude to her regarding her valuable suggestions to the Company.

Shri Aswini Kumar Sahoo

Shri Aswini Kumar Sahoo joined our Company as on 22nd May, 2013 as a Non-Executive Director (additional) by the Board of Directors of the Company and subsequently his appointment was further confirmed by Shareholders in their 21st Annual General Meeting held on 30th September, 2013 as regular Independent Director of the Company who is liable to retire by rotation.

Shir Ashok Kumar Gautam

Shri Ashok Kumar Gautam was appointed by the Board of Directors of the Company as an Additional Independent Director w.e.f. 9th August, 2014.

Shri Ashok Kumar Singh

Shri Ashok Kumar Singh was appointed by the Board of Directors of the Company as an Additional Independent Director w.e.f. 3rd September, 2014.

STATUTORY AUDITORS

M/s. Vijay N. Tewar & Co., Chartered Accountants, bearing ICAI Membership No. 040676 and Statutory Auditors of the Company, retire at the forthcoming Annual General Meeting and are eligible for re-appointment.

As required under Section 139 of the Companies Act, 2013, the Company has obtained a written consent from M/s Vijay N. Tewar, of such appointment and also a certificate to the effect that their appointment, if made, would be in accordance with Section 139(1) of the Companies Act, 2013 and the rules made there under, as may be applicable.

AUDITORS'' REPORT

The Auditors'' Report to the shareholders does not contain any qualification.

COST AUDITOR

Pursuant to the direction from the Ministry of Corporate Affairs for appointment of Cost Auditors, our Board has re-appointed M/s .S.

S. Puranik & Associates, as the Cost Auditor of our Company for the financial year 2013-14 to conduct the audit of the cost records of the Company.

SECRETARIAL AUDITOR

Pursuant to the provisions of the Companies Act, 2013, your Company has appointed M/s. Devesh Vimal & Co., as Secretarial Auditor.

DUE DILIGENCE REPORT

M/s. Swati Bhatt & Co. Practicing Company Secretary conducted due diligence audit and has submitted the report confirming compliance with the applicable provisions of Companies Act and other rules regulations issued by various regulatory authorities.

SHARE CAPITAL DURING THE YEAR UNDER REVIEW

Your Company in the financial year 2013-14 has increased its Authorised Share Capital from existing Rs.50,00,00,000 (Rupees Fifty Crores Only) divided into 5,00,00,000 (Five Crores Only) Equity Shares of Rs.10/- (Rupees Ten) each to 5,58,58,500 (Five Crores Fifty Eight Lacs Fifty Eight Thousand Five Hundred Only) Equity Shares of Rs.10/- (Rupees Ten) each and 41,41,500 (Forty One Lacs Forty One Thousand Five Hundred Only) Preference Shares of Rs. 10/- (Rupees Ten) Each Rs. 10/- (Rupees Ten) Each

Further, Company has issued 43,92,000 Share Warrants during the year under review which were converted on 20th March, 2014 in to the Equity Shares ranking parri passu with existing Equity Shares of the Company.

In addition to above Company has also issued 41,41,500 Redeemable Cumulative Preference Shares to the promoters'' group companies.

DEBENTURES

In financial year 2011-12, the Company has issued Non-Convertible Debentures amounting to Rs.32 Crores in aggregating of Rs. 100 Crores (Debentures of Rs. 68 Crores were issued in financial year ended on 31st March, 2011) Rs. 1 Lacs Each at the rate of 12%, 12.25%, 12.35%, 12.50% and 12.75% to the respective Debenture Holders.

M/s. Unit Trust of India Investment Advisory Services Limited was appointed as Debenture Trustee of the Company.

Any member interested in obtaining any information regarding Debentures or Debenture holders may write to the Company Secretary at the Corporate Office of the Company.

GOVERNANCE POLICY

a) The Code of Conduct

At Diamond Group of Companies Code of Conduct is a periodically reviewed document that takes into account business practices in different parts of the globe. It is meant to be a guiding principle and is shared with all stakeholders - including employees, partners, vendors, suppliers, contractors, etc. - as it governs all aspects of fair practice.

We emphasis on major code of conducts like

- Ethics, Transparency and Accountability

- Maximising the sustainability of goods and services throughout their lifecycle

- Enriching the quality of life of employees and maximising their potential

- Inclusive growth through stakeholder engagement

- Businesses should respect and promote human rights

- Protecting the Environment

- Inclusive growth and equitable development

- Value to customers

b) Management of Business Ethics

The business ethos of the Code of Conduct is deployed through aspecially formulated structure called the Management of Business Ethics (MBE). It is based on the four pillars of:

- Leadership

- Communication and Awareness

- Compliance Structure

- Evaluation of Effectiveness

c) Committees

Several focused Committees have been constituted by the Board who meet periodically to review their respective terms of reference. These include:

- Audit Committee

- Stakeholders'' Grievances & Relationship Committee (Formerly known as Investors'' Grievances Committee)

- Nomination and Remuneration Committee (Formerly termed as Remuneration Committee)

- Share Transfer Committee

- Debenture Issue Committee

- Corporate Social Responsibility (CSR) Committee

d) Policies

A number of policies have been put into place to ensure that governance standards are met. They are based on zero tolerance towards corruption and unethical behaviour. These include:

- Whistle Blower Policy / Vigil Mechanism

- Vendors and Suppliers Whistler Blower Policy

- Sexual Harassment Prevention and Redressal Policy.

- Policy against unethical behaviour.

INSURANCE

All the insurable interests of our Company including inventories, buildings, plant and machinery and liabilities under legislative enactments are adequately insured.

PERSONNEL

The Board of Directors wishes to express their appreciations to all the employees for their outstanding contribution to the operations of the Company during the year. Any member interested in obtaining a copy of the Statement of Particulars of employees referred to in Section 217(2A) of the Companies Act, 1956, may write to the Company Secretary at the Corporate Office of the Company.

LITIGATION

We have a core and competent team of legal department who instantaneously looks after all the material litigations. However, during the year 2013-14 under review there were no material litigations against our company as reported by legal department.

QUALITY CONTROL

It is the quality of our work which will please our Customers and not the quantity. The Company is committed to establish, sustain and strengthen the quality management system in each sphere of its operation, aiming at total customers'' satisfaction.

To achieve this, it will be an endeavour of the Company to strive towards producing impeccable products, ensuring timely delivery and providing quality services to our valued customers.

In terms of quality, the Company is certified by ISO 9001:2008, ISO 14001:2004 and OHSAS 18001:2007.

ENVIRONMENTS SAFETY

The Company has given high priorities to Environment and Safety. A number of initiatives have been taken to embed a culture of safety and safe working practices in the organisation. A detailed corporate safety action plan has been prepared, including the activities that will be guided and supervised by the Management.

The Company is pro-actively complying with the Statutory, legal and other requirements related to environment, safety and occupational health as pertinent to various processes, to ensure lowest pollution levels and safe working environment throughout the organization.

We are striving to prevent accidents and injuries, lower the incidences of occupational and ill health issues across the Company by identification and documentation of all environmental aspects as well as hazard risks.

The Company is certified by ISO 14001:2004 - for Environmental Management System and OHSAS 18001:2007 for Occupational Health and Safety Management Systems.

RISK MANAGEMENT

As part of the Risk Management Process, during the year, the Company reviewed the various risks and finalized mitigation plans. These were reviewed periodically by the Management and closely monitored and reviewed the risk plans periodically.

CORPORATE GOVERNANCE

As per the requirement of Clause 49 of the Listing Agreement entered into with the Bombay Stock Exchange of India Limited and National Stock Exchange of India Limited, a detailed report on Corporate Governance is set out in this report. The Statutory Auditors of the Company have examined the Company''s Compliance in this regard and have certified the same. As required under the SEBI Guidelines, such certificate is reproduced in the Report. A separate Management Discussion and Analysis Report on the company''s performance are attached to this report.

The declaration given by the Managing Director and Joint Managing Director with regard to compliance of Company''s code of conduct by the Board members and senior management is furnished to this report.

CORPORATE SOCIAL RESPONSIBILITY VOLUNTARY GUIDELINES

In accordance with Section 135 of the Companies Act, 2013, the Board of Directors of the Company at their meeting held on 30th May, 2014 framed CSR Committee.

DIRECTORS'' RESPONSIBILITY STATEMENT

Under Section 217(2AA) of the Companies Act, 1956, the directors confirm that:

a) In the preparation of Annual Accounts, the Company has followed the applicable Accounting Standards issued by the Institute of Chartered Accountants of India along with proper explanation relating to material departures;

b) Such accounting policies have been selected and consistently applied and judgments and estimates made thus are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company for the year ended 31st March, 2014 and of the Profit /Loss for the year ended on that date;

c) Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safe guarding 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.

CONSERVATIONS OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE

The particulars relating to Conservation of Energy, Technology Absorption, Foreign Exchange Earning and Outgo as required by Companies Act, are mentioned in this Report.

ACKNOWLEDGEMENT

Our Directors would like to express their grateful appreciation for the assistance and co-operation, received from the Banks, Financial Institutions, various government authorities, customers, vendors and shareholders during the year. Our Directors also wish to place on records the deep sense of gratitude for the committed services of the executives, staff members and workers.

For and On Behalf of the Board of Directors

(S. N. Bhatnagar)

Chairman

Date: 9th August, 2014 Place: Vadodara


Mar 31, 2013

To the Members,

The Directors are pleased to present the Twenty First Annual Report together with the audited accounts of the Company for the year ended on 31st March, 2013.

FINANCIAL RESULTS

Rs. in Lacs Particulars 2012-13 2011-12

Income 2,13,274.84 1,74,358.26

Expenditure 1,90,741.24 1,54,738.95

Gross Profit / (Loss) before Interest, Depreciation & Tax 22,533.60 19,619.31

Interest 8,560.43 4,850.90

Depreciation 3,265.41 2,429.26

Net Profit / (Loss) before Tax 10,707.76 12,339.15

Provision for Taxation / Deferred Tax 1,500.00 1,500.00

Profit / (Loss) after Tax 9,207.76 10,838.85

Share Capital 3,720.64 3,720.64

Reserves & Surplus 65,647.17 57,015.96

EPS 24.75 29.13

IMPORTANT PERFORMANCE PARAMETERS

Rs. in Lacs Particulars 2012-13 2011-12

Gross Profit Margin (%) 10.00 9.47

Asset Turnover (times) 1.10 1.11

Interest Coverage (times) 2.54 3.96

Earning per Shares (diluted) (Rs.) 24.75 29.13





DIVIDEND

In view of substantial growth, good financial performance and Bonus Shares to the Existing Shareholders during the year, the Board has recommended dividend of Rs. 1 per share (i.e. 10%), out of the profit of the financial year ended on 31st March, 2013 on 37,206,371 (Excluding Bonus Share i.e 12,402,124) equity shares of Rs. 10.00 each fully paid up aggregating to Rs. 372,063,710.

This is clarify that as per resolution passed by the shareholders of the company at their Extra Ordinary held on 17th August, 2013 pertaining to 12,402,124 bonus equity shares which have been allotted on 29th August, 2013 i.e. in the financial year 2013-14. Accordingly, these bonus equity shares shall be entitled to the full dividend declare in respect of the financial year 2013-14 irrespective of the date of allotment.

In other words, bonus equity shares shall be entitled to full dividend and will not be pro-rated on the basis of date of allotment. Thus, entitlement of bonus equity shares on dividend, if declared, would commence from the financial year 2013-14 and thereafter but not before that.

The dividend on Ordinary Share is subject to the approval of the shareholders at the Annual General Meeting.

GLOBAL ECONOMY COMPARED WITH INDIAN ECONOMY

The world Gross Domestic Product (GDP), as reported by the International Monetary Fund, witnessed a moderate growth of 3.2% in 2012 as compared to a growth of 4.0% in 2011.While the growth in the advanced economies was 1.2% in 2012 in contrast to 1.6% in 2011, growth in the emerging and developing economies fell to 5.1% in 2012 compared to 6.4% in 2011. There was a noticeable slowdown in the emerging market and developing economies during 2012, a reflection of the sharp deceleration in demand from key advanced economies. Global prospects have improved but the road to recovery in the advanced economies is still uncertainand volatile.

As per the report of World Bank, it scaled down India''s growth forecast to 6.1% for the current fiscal from 7% projected six months ago. The decline in the growth forecast is largely due to the decline in agriculture sector which is expected to grow at 2% during the current year against the previous estimate of 2.7% despite normal monsoon projection. However, the multi-lateral funding agency said that India is regaining economic momentum and growth is expected to recover gradually to its high long-term potential.

This estimate by CSO is drastically lower than what has been projected thus far by the government and RBI. India''s economic growth rate this fiscal is estimated to be sharply lower at 5%, lowest in a decade, on account of poor performance of manufacturing, agriculture and services sector.

This estimate by CSO is drastically lower than what has been projected thus far by the government and RBI.

"The growth in GDP (Gross Domestic Product) during 2012-13 is estimated at 5% as compared to a growth rate of 6.2% in 2011- 12," according to the Advanced Estimates released today by the Central Statistical Organisation (CSO).

In 2002-03, the GDP had grown at 4%. Since then the Indian economy has been expanding at over 6%, the highest rate being 9.6% in 2006-07.CSO''s advance estimate lowered the growth in agriculture and allied activities to 1.8% in 2012-13, compared to 3.6% 2011-12.

Manufacturing growth is also expected to drop to 1.9% in this fiscal, from 2.7% last year.

The CSO''s GDP growth projection is a lower than the 5.5% forecast made by the Reserve Bank in its quarterly monetary policy. In its mid-year Economic Review, the government had also estimated growth ranging from 5.7-5.9%. The current estimate is a sharply lower than the 7.6% growth projection for 2012-13 made by government in Budget.

The latest estimate of 5% for the entire fiscal means that the pace of economic expansion has slowed sharply in the second half of 2012-13, given that GDP growth in the April-September period stood at 5.4%.

According to the advance estimates, the services sector including finance, insurance, real estate and business services sectors are likely to grow by 8.6% this fiscal, against 11.7% last fiscal.

However the growth in the mining and quarrying is likely be slightly better at 0.4%, compared to contraction of growth of 0.6% a year ago.

Growth in construction is also likely to be 5.9% in 2012-13, against 5.6% last year.

According to the CSO''s advance estimates, growth in electricity, gas and water production is likely to decline to 4.9% in 2012-13, from 6.5% in 2011-12.

During the current fiscal, the trade, hotel, transport and communication sectors are projected to grow by 5.2%, as against 7% last fiscal.

Community social and personal services growth however would be slightly better at 6.8%, compared to 6% in previous fiscal.

Overall, the 5% growth in the advanced estimates is lower than what experts have been forecasting.

Yesterday, the International Monetary Fund (IMF) had said that the Indian economy would grow by 5.4% in 2012-13, but should pick up to 6% in next fiscal.

The Indian economy had expanded by 8.4% in both 2010-11 and 2009-10, while growth in 2008-09 was 6.7%.

The advance GDP estimates are released by the CSO before the end of a financial year to enable the government to formulate various estimates for inclusion in the Budget.

GLOBAL ELECTRICAL EQUIPMENT INDUSTRY

According to International Energy Agency''s World Energy Outlook 2009 report. The demand for electricity worldwide is projected to grow at an annual rate of 2.7% for the period 2007–2015, slowing down to 2.4% per year during the period 2015–2030 as economiesmature, and the generation and supply of electricity becomes more efficient. Over 80% of the growth between 2007 and 2030 is expected to be in non-OECD countries. The demand in these countries is expected to grow by 5% per year up to 2015, slowing down to 3.3% per year in 2015–2030.

The world''s installed power generation capacity is projected to rise from 4,509 GW in 2007 to about 10,000 GW in 2030. Total gross capacity addition is expected to amount to 4,800 GW over the period, with 30% of this addition planned for installation by 2015. On an average, capacity additions are projected to amount to 190 GW per year during 2008–2015, rising to almost 220 GW per year during 2016–2030. The largest capacity additions are forecasted in China and would comprise nearly 30% of total global capacity addition. The cumulative investment during 2008–2030 is expected to amount to US $13.7 trillion, with US $7.2 trillion needed in generation, US $2 trillion in transmission and US $4.5 trillion in distribution.

The global electrical equipment industry consists of the following two segments:

a. Global heavy electrical equipment market — power generating equipment, including windturbines, and other heavy electrical equipments such as power turbines, heavy electrical machinery intended for fixed-use and large electrical systems.

b. Global electrical components and equipment market — electric power cables, Transformers and electrical switchgear, Transmission Line Towers, etc.

The global EE market is expected to increase from more than US $3 trillion (2008-15) to US $6.8 trillion (2016-30). This translates into 2% CAGR over the long term.

Asia-Pacific and Europe together account for more than 70% of the global market, with Asia-Pacific''s share being 45%. This region is expected to see the strongest demand in future due to the region''s strong expected economic growth rates.

Globally, growth rates have been less-than-impressive in recent years in the electrical equipment market, but there is scope for expansion in certain geographical areas, such as the emerging markets in the Asia-Pacific region. Robust economic growth in emerging countries such as China and India, combined with rapid urbanization and strong growth in fixed investment spending in these countries, is expected to boost the demand for electrical equipment in these countries.

INDIAN POWER SECTOR

Power is a necessary fuel for a growing economy. Indian economy is on a high growth path targeting GDP growth rate of 8-8.5%. To achieve this growth it is imperative that the power infrastructure is in place.

India has the fifth-largest generation capacity in the world with an installed capacity of over180 GW, as on 31st July 2011. The country is also the sixth-largest energy consumer, accounting for 3.4% of total global energy consumption. As the sixth largest energy consumer in the world, the total consumption in 2008-09 was estimated at 725 bn kWh. This is expected to increase to 975 bn kWh by 2011-12.

The industrial sector, due to increasing capacity additions, has the highest demand for electricity, as compared to others sectors (domestic, commercial and agriculture). Going forward its share is expected to remain high due to increasing industrial activity in the country. The domestic and commercial sectors are likely to experience a steady demand for electricity, but the share of agriculture is expected to see a decline in the coming years.

Transmission segment plays a key role in transmitting power to various distribution entities across India. However, the investment in transmission infrastructure has been half of that on generation, leading to major inadequacies in the transmission system. As on March 2009, inter-regional capacity stood at 20,750 MW and is estimated to be 37,150 by March 2012. During the Twelfth Plan, total transmission substation capacity addition is expected to be 3,01,000 MVA, while 120,000 ckt of transmission lines are expected to be added.

India''s electrical equipment industry is highly diverse and manufactures a wide range of high and low technology products. The industry size is estimated at 1,10,000 Crore (US$ 25bn)in 2010-11. The industry directly employs around five lakh persons and provides indirect employment to another ten lakh people. Most sub-sectors of the industry also make a large number of products in varied price and quality ranges. Some subsectors comprise a sizeable un organized segment as well. The industry can be broadly classified into two sectors –generation equipment and T&D equipment. Generation equipment segment consists of boilers, turbines and generators while the T&D equipment segment consists of transformers, cables, transmission lines, switchgear, capacitor, etc.

India''s electrical equipment industry has witnessed significant growth in the last few years. The major electrical equipments have grown at a CAGR of 23% from a small base of 7,415Crore in 2000–01 to 60,105 Crore in 2010-1120. The major electrical equipment manufactured include capacitors, energy meters, rotating machines, transformers, cables, switchgears, transmission line towers and conductors. Other Electrical Equipment includes instrument transformers, surge arrestors, stamping & lamination, insulators, insulating material, industrial electronics, indicating instruments, winding wires, etc. Growth in the industry has been led by the rise in demand from power grids, independent power producers (IPPs) and utilities for high voltage (HV) and extra high voltage (EHV) equipment.

The growth of the cable and wire industry is faster than the GDP growth of the country, The cable industry came out of recession by 2011-12 but it has had negative growth in Q1 of 2012-13.The industrial growth in India is 8% overall and it is much higher in the cable industry, as indicated by IEEMA. According to it, the cable industry is the only sector in the electrical equipment industry that showed a growth of 16.9% in 2011.Uncertainty in investment plan due to slowdown in industrial capex activities and off-take by users due to credit squeeze, high interest costs, etc, have caused. It is hoped the industry will be back on track.

Despite the global and local macro-economic depression, Indian economy and consequently the domestic demand of wire and cable industry continued to rise during the post-depression years of 2008 & 2009.The growth was less still more than the overall GDP of India.

The years, 2009-2010, proved to be good with cables production rising to 865,000 tonnes. As the Indian government is going ahead with reforms for the country''s infrastructure, the demand for cable should result in stronger demand, which may take the market to 120,000 tonnes by year 2014.The rise in GDP growth for cables will be 13-14 % per year on compounded basis.

The market for power conductors is set to boom in the XII Plan period thanks to a much higher power transmission outlay. With private sector companies lending a supporting hand in mega transmission lines, demand for power conductors is expected to soar. It is not just a case of volumes growth; power conductors in the coming years will be even more technologically advanced.

The power conductor industry is very likely to see impressive growth, thanks to a much higher outlay for the power transmission sector. According to estimates, the power transmission sector is expected to see investment of Rs. 2,40,000 crore during the XII Plan period, which would be over 70 per cent higher than the comparable Rs. 1,40,000 crore in the ongoing XI Plan period. Power generation, which has been the focus in the X and XI Plan periods, is seen making way for power transmission & distribution in the XII Plan. Needless to say, the power conductor industry stands to gain tremendously.

According to industry experts, 25 per cent of the total cost of a typical power transmission project is towards conductors. Going by this, the business opportunity size for power conductors in the XII Plan would be Rs.60,000crore. The total opportunity arena could be much higher than this considering that conductors also find minor application in power distribution (sub-transmission) projects. Given that the total investment outlay on power distribution in the XII Plan is Rs. 4,00,060 crore, even if one considers a small fraction of this outlay, the total opportunity size for power conductors in the XII Plan could even be in the region of Rs.70,000 crore.

The transformers market in India has been in a healthy state for quite some years now. The market is further expected to witness healthy growth rates and stimulating demand for the coming years. The initiatives undertaken by the Government of India along with the need of replacement of transfers installed in the earlier years is expected to drive growth in the Indian transformers market.

The Indian transformer industry is more than five decades old, hence mature. Domestic manufacturers have developed capabilities to manufacture all types of equipment to meet the country''s demand for transformers up to 800kV and going up to 1,200kV. The industry enjoys a good reputation in terms of quality, price, and delivery in the domestic as well as overseas markets.

The transformer market in India can be pegged at more than Rs.13,000 crore. Power transformers contribute 45 per cent of the total market and distribution transformers 55 per cent. Over the last two years the market has grown at a very moderate rate at less than 4 per cent, due to the slowdown of power generation capacity addition and T&D infrastructure expansion.

Anticipating the huge domestic (due to a power deficit scenario, requirement of power sector expansion) and overseas demand, the transformer industry in India has more than doubled its manufacturing capacity over the last five years. Transformer manufacturing capacity in India stands at 370 GVA with capacity utilization rates hovering around 60-70 per cent on an average over the last five years. Transformer over-capacity in the Indian market has led to immense pricing pressure scenario severely impacting the profitability of the market players

CURRENT ACTIVITIES OF THE COMPANIES

At present our Company is generating revenues from Cables, Conductors, Transformers, Transmission and EPC Contracts. Company provides to its customers, numerous ranges of products in terms of best quality and ensures them optimum satisfaction level. We are glad to give you a brief look on the wide array of product range offered by our Company:

CABLES

Our power cables transmit a reassuring quality that can be counted on at all times. Our range includes the highly reliable LV/ HV cables from 1.1KV to 132KV and the EHV cables from 220KV to 550KV. In order to deliver world-class power transmission products, we leverage our CCV method of manufacturing, coupled with German technology. What''s more, we also offer a 10-year warranty on our products against manufacturing defects - a first of its kind assurance that helps build the client''s confidence and trust in our products.

Power and Control Cables include

T LV (1.1KV) grade aluminum/copper, armoured/ unarmoured, PVC/FRLS/XLPE cables up to 1000 sq.mm in single core and 630 sq mm in multi core that conform to IS1554-I, IS 7098-I and other international standards

T Copper control cables up to 61 core with PVC/XLPE/FRLS that conform to international standards and specifications

T HV cables up to 132KV as per international specifications and standards

T EHV cables from 220KV to 550KV

T Aerial Bunch Cables (ABC), both in LV & HV grade that conform to various standards

T Specialty cables which include control & instrumentation cables

T PVC / XLPE insulated ACSR & AAA conductors for special purposes

T Flexible cables with single core and multi core that conform to international standards and BS specifications.

PRODUCTION CAPACITIES

Our key equipment suppliers include global leaders such as Scholz, Nokia-Maillefer and Supermac among others. Amongst the top five power cable manufacturers in India, Diamond Power has also established India''s first ''vertical lead extrusion facility'' as well as the ''aluminum extrusion facility'' for cables, ranging from 66KV and more. Our cable capacities include:

T LV cables (1.1KV): 34300 KMPA

T HV cables (up to 132KV): 5800 KMPA

T EHV cables (220KV & above): 2500 KMPA

Approvals, Certifications and Testing

T ISO 9001-2008 Certified

T Products type-tested at ERDA and CPRI

T BIS certification for all LV / HV cables, conductors

Products approved and accepted by leading electrical consultants, EPC contractors and corporate houses

T Products approved by most of the power utilities viz. Powergrid, NTPC, NHPC and State Electricity Boards

In addition to the above wider range of Cables, your Company took toddler steps to enter into the market of flexible wires, multi core cables, and special instrumentation and automation cables for domestic and industrial purpose with the brand name of DIATRON.

DIATRON Flame Retardant Cables are made of Electrolytic grade, bright plain annealed copper conductor, as per IS: 8130- 1984. These cables are suitable for all Industrial & Domestic wiring applications.

The cables have high oxygen and temperature index and insulation of Flame Retardant- FR PVC compound, giving it additional safety. The cables have twin coating giving it superior insulation. Further the wires have uniform diameter and are available in standard lengths.

DIATRON flexible wires are made of bright, plain multi-stranded annealed copper conductor, as per Class 5 of IS 8130: 1984 with PVC insulation. These wires are used for all industrial wiring applications and are available in single and multi cores in standard lengths.

CONDUCTORS

Proficient Range of Conductors

Our range of conductors has been designed for superior efficiency and performance. Conductor manufacturing has been Diamond Power''s core competency since inception; it has today evolved into the country''s second largest player with a market share of over 25% and an installed capacity of over 50,500 MT. The product range comprises of 7 strand to 91 strand from 11KV HVDC lines. Diamond Power has supplied more than 1 million KM of conductors.

Our Transmission and Distribution Conductors include

T Aluminum Alloy Conductor Steel Reinforced (AACSR)

T All Aluminum Conductors (AAC)

T All Aluminum Alloy Conductors (AAAC)

T Aluminum Conductor Steel Reinforced (ACSR)

T Aluminum Conductor Alloy Reinforced (ACAR)

T High Conductivity Alloy Conductors AL-59 etc

Production Capacities

T Installed capacity of over 50,500 MT

T Annual capacity of over 80,000 KMPA

Approvals, Certifications and Testing

T ISO 9001-2008 certified

T Products are type-tested at ERDA, NETFA, TAG and CPRI

T India''s first plant with in-house alloy manufacturing capabilities with type- testing facilities for rods

T Products approved with Powergrid, NTPC, NHPC and SEB''s

T First in India to develop and manufacture alloy conductors and proto-test HSHC (High Strength and High Conductivity) conductors

T First BIS mark holder for alloy conductors in India having ISI licenses for all types of conductors

Product Awards

T Winner of the International Gold Star Award & Quality Award from BID Spain

TRANSFORMERS

Power and Distribution Transformers

Diamond Powers transformer division has been formed with the takeover of Western Transformers and Apex Transformers. This merger brings in over 4 decades of manufacturing and technical excellence. To further fuel growth in the division, fresh investments in technology, capabilities and capacities have been made. Our transformer range comprises of state-of-the-art power, distribution and dry-type transformers. It includes 11KV to 220KV, all the way up to 315MVA. Each of our transformers undergoes stringent type-testing, ensuring higher efficiency as well as reliability. We have successfully manufactured and type-tested transformers with ratings starting from 10 KV to 315 MVA, up to 220 KV class.

Power & Distribution Transformers include:

T Power transformers up to 220KV, 315 MVA

T Distribution transformers up to 33KV, 2500 KVA

T Single phase track side transformers up to 145KV, 10 MVA

T Single phase track side transformers up to 145KV, 31 MVA

T Cast resin transformers up to 36KV, 3150KVA

T Current transformers up to 245KV

T Voltage transformers up to 72.5KV

T Vacuum circuit breakers up to 36KV, 2500 A, 40KA

T Dry type transformers

Production facilities and Approvals:

T Three fully-integrated facilities in Gujarat with in-house facilities for products such as core laminations, wire drawing, strip mill, winding as well as an in-house transformer oil refinery

T A world class dry-type transformer facility

T Over 50,000 installed transformers worldwide and an annual production capacity of 5000 transformers

Approvals, Certifications and Testing:

T Our type-testing facilities of up to 1000 KV have been installed with a view to cover anticipated increased needs in the future

T Over 500 type-tests of several sizes done in laboratories all over the world

T Our R&D facilities have been certified by DSIR, Govt. of India and ISO 9001-2008

TRANSMISSION towers

A Tough Range of Transmission Towers

Our transmission towers have been designed to withstand the roughest of weathers. Sturdily built and technically superior in quality, these towers can perform in the most demanding of conditions. Not surprisingly, Diamond Power''s transmission towers are empowering every corner of the country by delivering power efficiently and reliably.

Diamond Power, India''s most diversified power T&D Company has commenced production at its transmission tower facility.

Product Facilities

Our state-of-the-art facility is located at Phase II Village: Vadadala, Taluka: Savli, Dist.: Vadodara. It has been designed to manufacture a wide range of transmission towers with a capacity of 48,000 MTPA.

TURNKEY PROJECTS

Our turnkey services in the power T&D sector are the key to our growth. We not only conceptualize the project, but also take charge of various stages of the project including planning, design and development, procurement, right up to the erection and commissioning. This has made us the country''s largest integrated power solutions provider. With our vast product range, we have an in-house control over 80% of the average EPC project cost.

Overhead Transmission Lines

One of our core focus areas is high voltage and extra high voltage transmission line projects. Our technical capabilities, financial viability and superior execution skills ensure a cutting-edge project development and implementation.

Rural & Urban Distribution Projects

Our solutions also encompass rural and urban electrification and distribution projects; wherein we offer end-to-end services – right from project design to commissioning.

Substation Projects

Diamond Power also undertakes MV, HV and EHV substation projects. Here again, our technical, financial and managerial prowess allows us to configure a project that fulfills client demands.

DEVELOPMENTS & EXPANSION PLANS

Success seems to be connected with Action, We at a Diamond Power continuously working for the creation of wealth for our stakeholders, Your dream to see the company reaching new heights is our goal and validating the same we are very proud to inform you that the company is growing very potentially in the field of power infrastructure. Globally, the company is working on the new and related activities, which aims to achieve the Company''s goal of making Diamond Group as the real Power Infrastructure Company which adds value to its stake holders. Our company has already commenced its commercial operation of HT Project in addition to this, the Company having commissioned India''s First Extra High Voltage Cables Plant to manufacture 500 KV Cables. The Company is also working to expand its business in foreign nations with collaboration of other foreign organizations.

Our Company expands its horizons by setting new heights, by adding to its current manufacturing setup new projects for producing conductors and medium voltage cables at Vadadala, Vadodara to cater to the growing demand from its existing markets.

In case of Conductors, the Company aims to take advantage of the current market scenario and become a key supplier of conductors. It also plans to expand its conductors manufacturing capacity to 1,50,500 MT p.a. from the current capacity of 50,500 MT p.a. Along with the proposed expansion, the Company also proposes to increase its rod manufacturing facility to 1,22,000 MT p.a. from the present 32,000 MT p.a.

In case of Medium Voltage Cables, the Company proposes to put up additional 3 lines, each with an installed capacity of 2,500 kms totaling to7,500 kms which will augment the current capacity of 5,600 kms to 12,700 kms.

The Company has added a new feather to its cap by setting up the first testing laboratory in India to test Extra High Voltage Cable up to 500 KV. This laboratory is a state of art and equipped with latest technology which will enable the Company to test EHV Cables up to 500 KV within the Company.

Taking steps forward to compete with our Competitors in today''s tech savvy world the Company is planning to shift from manual to automatic process which will ensure highest level of productivity and minimum level of handling and processing errors. This system will be time as well as cost effective. Further with respect to futuristic vision, the Company is planning for backward and forward integration for raw materials and packaging which will minimize the Company''s cost.

Further, Your Directors at their meeting held on 22nd May, 2013 have decided to transfer its two undertakings viz. Tower Division & EPC Division situated at phase II village: Vadadala, Taluka : Savli, Dist. Vadodara. This would enable the Company to have more liquidity as well as enable the Company to have exclusive attention and more focused approach on remaining undertaking viz. cable unit & conductor unit.

FINANCIAL STATEMENTS

The Ministry of Corporate Affairs (MCA) vide notification no. S.O. 447(E) dated 28th February, 2011 amended the existing Schedule VI to the Companies Act, 1956. The Revised Schedule VI is applicable from financial year commencing from 1st April, 2011.

The financial statements of our Company for the year ended on 31st March, 2013 have been prepared in accordance with the Revised Schedule VI and accordingly, the previous year''s figures have been reclassified/ regrouped to conform to this year''s classification.

Our Directors have pleasure in attaching the Consolidated Financial Statements pursuant to Clause 32 of the Listing Agreement entered into with the Stock Exchanges and prepared in accordance with the Accounting Standards prescribed by the Institute of Chartered Accountants of India, in this regard.

SUBSIDIARY COMPANIES

M/s. Diamond Power Transformers Limited and M/s. Diamond Power Global Holdings Limited are wholly owned subsidiaries of our company.

Diamond Power Transformers Limited

Diamond Power Transformers Limited has performed well and has achieved 100% growth in turnover. The Company is one of the core suppliers of transformers to the clients like BHEL, Noida Power, and Electricity Boards etc. The Company expects to achieve higher growth with addition of varied size and rating of transformers. We are pleased to inform to our shareholders about the acquisition of strategic stake by Diamond Power Transformers Limited in Maktel Control and Systems Private Limited and Maktel Power Limited (formerly known as Danke Control Private Limited) as a measure of expanding its current operations in July 2012.

The Accounts of M/s. Diamond Power Transformers Ltd, Wholly Owned Subsidiary Company, together with the reports of the Directors and the auditors, as required under Section 212 of the Companies Act, 1956, are attached with this annual report.

Diamond Power Global Holdings Limited

Diamond Power Global Holdings Limited was incorporated on 3rd November, 2011 as a 100% subsidiary of Diamond Power Infrastructure Limited in Jebel Ali Free Zone (JAFZA), Dubai, U.A.E. to promote exports of the Company in the Middle East. The company being a toddler is taking steps towards attaining its object successfully and in years to come is expected to achieve the desired results.

Financial numbers for Diamond Power Global Holding Limited are already included in the annual accounts of the Company.

DIRECTORS

In accordance with the Companies Act, 1956 and the Articles of Association of the Company Shri Kirit Vyas and Shri Ranvir Singh Shekhawat are liable to retire by rotation at the Annual General

Meeting. However, they are eligible for re-appointment. Shri Aswini Kumar Sahoo who was appointed as a Non-Executive Director by the Board will retire at this Annual General Meeting and the Company has also received his candidature for re-appointment as a Non-Executive (Independent) Director of the Company.

Further during the year under review following Directors were retired and appointed:

Shri Rajagopalan Thirumalainallan Chakravarthy

Shri T N C Rajgopalan joined our Company on 18th October, 2007 as an Independent Director. Due to his pre occupation he opted for retirement from the Board of Directors and resigned on 23rd October, 2012. Shri Rajagopalan served as a Chairman of the Audit Committee. His suggestions and guidance have indeed proved to be very effective in the progress of the Company. The company will always be thankful to him to guide it like a lamp in the dark.

Smt. Dr. Vasantha Bharucha

Smt. Dr. Vasantha Bharucha joined our Company as on 28th September, 2010 as a Non-Executive Director. Due to her pre occupation she opted for retirement from the Board of Directors and conveys her resignation on 22nd May, 2013. Dr. Bharucha served as a Chairman of the Investors'' Grievances Committee and Member of Audit Committee and Remuneration Committee. The Company has been able to nail down many opportunities that have come its way with the help of her suggestions and guidance. The Management would like to extend its gratitude to her regarding her valuable suggestions to the Company.

Shri Aswini Kumar Sahoo

Shri Aswini Kumar Sahoo joined our Company as on 22nd May, 2013 as a Non-Executive Director.

STATUTORY AUDITORS

M/s. Vijay N. Tewar & Company, Chartered Accountants and Statutory Auditors of the Company, retire at the forthcoming annual general meeting and are eligible for re-appointment. A certificate has been obtained from them to effect that, the appointment, if made, will be in accordance with the limits specified in sub-section (1B) of Section 224 of the Companies Act, 1956.

AUDITORS'' REPORT

The Auditors'' Report to the shareholders does not contain any qualification.

COST AUDITOR

Pursuant to the direction from the Ministry of Corporate Affairs for appointment of Cost Auditors, our Board has reappointed M/s. S. S. Puranik & Associates, as the Cost Auditor of our Company for the financial year 2012-13 to conduct the audit of the cost records of the Company.

DEBENTURES

In financial year 2011-12, the Company has issued Non- Convertible Debentures amounting to Rs.32 Crores in aggregating of Rs. 100 Crores (Debentures of Rs. 68 Crores were issued in financial year ended on 31st March, 2011) Rs. 1 Lacs Each at the rate of 12%, 12.25%, 12.35%, 12.50% and 12.75% to the respective Debenture Holders. M/s. Unit Trust of India Investment Advisory Services Limited was appointed as Debenture Trustee of the Company.

Any member interested in obtaining any information regarding Debentures or Debenture holders may write to the Company Secretary at the Corporate Office of the Company.

FIXED DEPOSITS

The company has not accepted any deposits from public during the year under review to which provisions of Section 58A of the Companies (Acceptance of Deposits) Rules, 1975 as amended is applicable.

GOVERNANCE POLICY

a) The Code of Conduct

At Diamond Group of Companies Code of Conduct is a periodically reviewed document that takes into account business practices in different parts of the globe. It is meant to be a guiding principle and is shared with all stakeholders – including employees, partners, vendors, suppliers, contractors, etc. – as it governs all aspects of fair practice.

We emphasise on major code of conducts like

T Ethics, Transparency and Accountability

T Maximising the sustainability of goodsand services throughout their life cycle T Enriching the quality of life of employees and maximising

their potential T Inclusive growth through stakeholder engagement T Businesses should respect andpromote human rights T Protecting the Environment T Inclusive growthand equitable development T Value to customers

b) Management of Business Ethics

The business ethos of the Diamond Code of Conduct is deployed through aspecially formulated structure called the Management of Business Ethics (MBE). It is based on the four pillars of

T Leadership

T Communication and Awareness

T Compliance Structure

T Evaluation of Effectiveness

c) Committees

Several focused Committees have been constituted by the Board who meet periodically to review their respective terms of reference. These include:

T Audit Committee

T Investors'' Grievances Committee

T Share Transfer Committee

T Debenture Issue Committee

T Remuneration Committee

d) Policies

A number of policies have been put into place to ensure that governance standards are met. They are based on zero tolerance towards corruption and unethical behaviour. These include:

T Whistler Blower Policy

T Vendors and Suppliers Whistler Blower Policy

T Sexual Harassment Prevention and Redressal Policy.

T Policy against unethical behaviour.

INSURANCE

All the insurable interests of our Company including inventories, buildings, plant and machinery and liabilities under legislative enactments are adequately insured.

PERSONNEL

The Board of Directors wishes to express their appreciations to all the employees for their outstanding contribution to the operations of the Company during the year. Any member interested in obtaining a copy of the Statement of Particulars of employees referred to in Section 217(2A) of the Companies Act 1956, may write to the Company Secretary at the Corporate Office of the Company.

LITIGATION

We have a core and competent team of legal department who instantaneously looks after all the material litigations. However, during the year 2012-13 under review there were no material litigations against our company.

QUALITY CONTROL

It is the quality of our work which will please our Customers and not the quantity. The Company is committed to establish, sustain and strengthen the quality management system in each sphere of its operation, aiming at total customers'' satisfaction.

To achieve this, it will be an endeavor of the Company to strive towards producing impeccable products, ensuring timely delivery and providing quality services to our valued customers.

In terms of quality, the Company is certified by ISO 9001-2008.

ENVIRONMENT & SAFETY

The Company has given high priorities to Environment and Safety. A number of initiatives have been taken to embed a culture of safety and safe working practices in the organisation. A detailed corporate safety action plan has been prepared, including the activities that will be guided and supervised by the Management.

The Company is dedicated to pro-actively comply with the Statutory, legal and other requirements related to environment, safety and occupational health as pertinent to various processes, to ensure lowest pollution levels and safe working environment throughout the organization.

We are striving to prevent accidents and injuries, lower the incidences of occupational and ill health issues across the Company by identification and documentation of all environmental aspects as well as hazard risks.

The Company is certified by ISO 14001:2004 - for Environmental Management System and OHSAS 18001:2007 for Occupational Health and Safety Management Systems.

RISK MANAGEMENT

As part of the Risk Management Process, during the year, the Company reviewed the various risks and finalized mitigation plans. These were reviewed periodically by the Management and closely monitored and reviewed the risk plans periodically. Employees play a very vital role by contributing to the risk identification process.

CORPORATE GOVERNANCE

As per the requirement of Clause 49 of the Listing Agreement entered into with the Bombay Stock Exchange Ltd and National Stock Exchange of India Limited, a detailed report on Corporate

Governance is set out with this report to this report. The Statutory Auditors of the Company have examined the Company''s Compliance in this regard and have certified the same. As required under the SEBI Guidelines, such certificate is reproduced as to this Report. A separate Management Discussion and Analysis Report on the company''s performance is given with this report.

The declaration given by the Managing Director and Joint Managing Director with regard to compliance of Company''s code of conduct by the Board members and senior management is furnished with this report.

CORPORATE SOCIAL RESPONSIBILITY VOLUNTARYGUIDELINES

MCA had released a set of guidelines on Corporate Social Responsibility (CSR) in December 2009. The Company is substantially complying with the guidelines lay down. The activities carried out by the Company as a part of its CSR initiatives are briefly described in this Annual Report. The detailed CSR activity of the Company is also available on the Company''s website www.dicabs.com.

DIRECTORS'' RESPONSIBILITY STATEMENT

Under Section 217(2AA) of the Companies Act, 1956, the directors confirm that:

a) In the preparation of Annual Accounts, the Company has followed the applicable Accounting Standards issued by the Institute of Chartered Accounts of India along with proper explanation relating to material departures;

b) Such accounting policies have been selected and consistently applied and judgments and estimates made thus are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company for the year ended on 31st March, 2013 and of the Profit /Loss for the year ended on that date;

c) Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safe guarding 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.

CONSERVATIONS OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE

The particulars relating to Conservation of Energy, Technology Absorption, Foreign Exchange Earning and Outgo as required under Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosures of Particulars in the Report of Board of Directors) Rules, 1988, is given this Annual Report.

ACKNOWLEDGEMENT

Our Directors would like to express their grateful appreciation for the assistance and co-operation, received from the Banks, Financial Institutions, various government authorities, customers, vendors and shareholders during the year. Our Directors also wish to place on records the deep sense of gratitude for the committed services of the executives, staff members and workers.

In rapidly changing business and technological environment, your Company regularly reviews its strategic direction; Operational efficiency and effectiveness; reliable reporting and compliances and such measures so as to meet various stakeholders'' expectations and long term sustainability.

Your Company continues to maintain its industry leadership, by pursuing excellence in everything it does including standards of business conduct.

By Order of the Board,

Nishant Javlekar

Company Secretary

Date: 24th July, 2013

Place : Vadadala


Mar 31, 2012

The are pleased to present the Twentieth Annual Report together with the audited accounts of the Company for the year ended 31st March, 2012.

FINANCIAL RESULTS

(Rs. in Lacs)

Particulars 2011-12 2010-11

Income 1,74,358.26 1,28,904.72

Expenditure 1,54,738.95 1,10,586.20

Gross Profit / (Loss) before Interest, Depreciation Tax & Amortization 19,619.31 16,318.52

Interest 4,850.90 2,487.77

Depreciation & Amortization 2,429.26 1,877.79

Net Profit / (Loss) after Depreciation & Interest 12,339.15 11,952.96

Share Capital 3,720.64 3,720.64

Reserves & Surplus 57,015.96 47,906.80

EPS 29.13 26.24

IMPORTANT PERFORMANCE PARAMETERS

Particulars 2011-12 2010-11

Gross Profit Margin (%) 9.47 12.06

Asset Turnover (times) 1.11 1.32

Interest Coverage (times) 3.96 6.41

Earning per Shares (Rs.) 29.13 26.24

DIVIDEND

In view of substantial growth and good financial performance during the year, the Board has recommended dividend of Rs. 4 per share (i.e. 40%), out of the profit of the financial year ended on 31st March, 2012 on 3,72,06,371 equity shares of Rs. 10.00 each fully paid up aggregating to Rs. 37,20,63,710.

CURRENT ACTIVITIES

At present our Company is generating revenues from Cables, Conductors, Transformers, Transmission and EPC Contracts. Company provides to its customers, numerous ranges of products in terms of best quality and ensures them optimum satisfaction level. We are glad to give you a brief look on the wide array of product range offered by our Company:

CABLES

Our power cables transmit a reassuring quality that can be counted on at all times. Our range includes the highly reliable LV/HV cables from 1.1KV to 132KV and the EHV cables from 220KV to 550KV. In order to deliver world- class power transmission products, we leverage our CCV method of manufacturing, coupled with German technology. What's more, we also offer a 10-year warranty on our products against manufacturing defects - a first of its kind assurance that helps build the client's confidence and trust in our products.

Power and Control Cables include

LV(1.1KV) grade aluminum/copper, armoured/ unarmoured, PVC/FRLS/XLPE cables up to 1000 sq mm in single core and 630 sq mm in multi core that confirm to IS1554-I, IS 7098-I and other international standards

Copper control cables up to 61 core with PVC/XLPE/ FRLS that conform to international standards and specifications

HV cables up to 132KV as per international specifications and standards

EHV cables from 220KV to 550KV

Aerial Bunch Cables (ABC), both in LV & HV grade that conform to various standards

Specialty cables which include control & instrumentation cables '.9.' PVC / XLPE insulated ACSR & AAA conductors for special purposes

Flexible cables with single core and multi core that conform to international standards and BS specifications.

Production Capacities

Our key equipment suppliers include global leaders such as Scholz, Nokia-Maillefer and Supermac among others. Amongst the top five power cable manufacturers in India, Diamond Power has also established India's first 'vertical lead extrusion facility' as well as the 'aluminum extrusion facility' for cables, ranging from 66KV and more. Our cable capacities include:

LV cables (1.1KV): 34300 KMPA HV cables (up to 132KV): 5600 KMPA EHV cables (220KV & above): 2500 KMPA Approvals, Certifications and Testing ISO 9001-2008 Certified Products type-tested at ERDA and CPRI BIS certification for all LV / HV cables, conductors Products approved and accepted by leading electrical consultants, EPC contractors and corporate houses

Products approved by most of the power utilities viz. Powergrid, NTPC, NHPC and State Electricity Boards

CONDUCTORS

Proficient Range of Conductors

Our range of conductors has been designed for superior efficiency and performance. Conductor manufacturing has been Diamond Power's core competency since its inception; it has today evolved into the country's second largest player with a market share of over 25% and an installed capacity of over 50,500 MT The product range comprises of 7 strand to 91 strand from 11KV HVDC lines. Diamond Power has supplied more than 1 million KM of conductors.

Our Transmission and Distribution Conductors include

Aluminum Alloy Conductor Steel Reinforced (AACSR)

All Aluminum Conductors (AAC)

All Aluminum Alloy Conductors (AAAC)

Aluminum Conductor Steel Reinforced (ACSR) Aluminum Conductor Alloy Reinforced (ACAR)

High Conductivity Alloy Conductors AL-59 etc Production Capacities

Installed capacity of over 50,500 MT Annual capacity of over 80,000 KMPA Approvals, Certifications and Testing ISO 9001-2008 certified

Products are type-tested at ERDA, NETFA, TAG and CPRI

India's first plant with in-house alloy manufacturing capabilities with type- testing facilities for rods

Products approved with Powergrid, NTPC, NHPC and SEB's

First in India to develop and manufacture alloy conductors and proto-test HSHC (High Strength and High Conductivity) conductors First BIS mark holder for alloy conductors in India having ISI licenses for all types of conductors Product Awards

Winner of the International Gold Star Award &

Quality Award from BID Spain

TRANSFORMERS

Power and Distribution Transformers

Diamond Power's transformer division has been formed with the takeover of Western Transformers. This acquisition brings in over 4 decades of manufacturing and technical excellence. To further fuel growth in the division, fresh investments in technology, capabilities and capacities have been made. Our transformer range comprises of state-of-the-art power, distribution and dry-type transformers. It includes 11KV to 220KV, all the way up to 315MVA. Each of our transformers undergoes stringent type-testing, ensuring higher efficiency as well as reliability. We have successfully manufactured and type-tested transformers with ratings starting from 10 KV to 315 MVA, up to 220 KV class.

Power & Distribution Transformers include:

Power transformers up to 220KV, 315 MVA Distribution transformers up to 33KV, 2500 KVA Single phase track side transformers up to 145KV, 10 MVA

Single phase track side transformers up to 145KV, 31 MVA

Cast resin transformers up to 36KV, 3150KVA Current transformers up to 245KV Voltage transformers up to 72.5KV Vacuum circuit breakers up to 36KV, 2500 A, 40KA

Production facilities and Approvals:

Three fully-integrated facilities in Gujarat with in-house facilities for products such as core laminations, wire drawing, strip mill, winding as well as an in-house transformer oil refinery Over 50,000 installed transformers worldwide and an annual production capacity of 5000 transformers

Approvals, Certifications and Testing:

Our type-testing facilities of up to 1000 KV have been installed with a view to cover anticipated increased needs in the future

Over 500 type-tests of several sizes done in laboratories all over the world

Our R&D facilities have been certified by DSIR, Govt. of India and ISO 9001-2008

TRANSMISSION TOWERS A Tough Range of Transmission Towers

Our transmission towers have been designed to withstand the roughest of weathers. Sturdily built and technically superior in quality, these towers can perform in the most demanding of conditions. Not surprisingly, Diamond Power's transmission towers are empowering every corner of the country by delivering power efficiently and reliably.

Diamond Power, India's most diversified power T&D Company has commenced production at its transmission tower facility.

Product Facilities

Our state-of-the-art facility is located at Village:Vadadala, Taluka:Savli, Dist.: Vadodara. It has been designed to manufacture a wide range of transmission towers with a capacity of 48,000 MTPA.

TURNKEY PROJECTS

Our turnkey services in the power T&D sector are the key to our growth. We not only conceptualize the project, but also take charge of various stages of the project including planning, design and development, procurement, right up to the erection and commissioning. This has made us the country's largest integrated power solutions provider. With our vast product range, we have an in-house control over 80% of the average EPC project cost.

Overhead Transmission Lines

One of our core focus areas is high voltage and extra high voltage transmission line projects. Our technical capabilities, financial viability and superior execution skills ensure a cutting-edge project development and implementation.

Rural & Urban Distribution Projects

Our solutions also encompass rural and urban electrification and distribution projects; wherein we offer end-to-end services - right from project design to commissioning.

Substation Projects

Diamond Power also undertakes MV, HV and EHV substation projects. Here again, our technical, financial and managerial prowess allows us to configure a project that fulfills client demands.

DEVELOPMENTS & EXPANSION PLANS

"A dream becomes a goal when action is taken towards its achievement." Your dream to see the company reaching new heights is our goal and validating the same we are very proud to inform you that the company is growing very potentially in the field of power infrastructure. Globally, the company is working on the new and related activities, which aims to achieve the Company's goal of making Diamond Group as the real Power Infrastructure Company which adds value to its stake holders. Our company has already commenced its commercial operation of HT Project in addition to this, the Company having commissioned India's First Extra High Voltage Cables Plant to manufacture 500 KV Cables. The Company is also working to expand its business in foreign nations with collaboration of other foreign organizations. As a measure of the same we are delighted to inform you that Company has started its 100% owned offshore Holding Company, Diamond Power Global Holdings Limited in Jebel Ali Free Zone (JAFZA), Dubai, U.A.E. Diamond Power Global Holdings Limited which was incorporated with the vision for the promotion of exports, not only in Dubai but also in Middle East and North Africa (MENA) markets. This will open the doors of international market for the Company.

Our Company expands its horizons by setting new heights, by adding to its current manufacturing setup new projects for producing conductors and medium voltage cables at Vadadala, Vadodara to cater to the growing demand from its existing markets.

The Board of Directors at their board meeting held on 13th February, 2012 approved the company's ambitious Expansion Project aggregating to Rs 753 Crores to be completed over a period of 30 months in three phases beginning from January, 2012. The company has already invested in the 6.3 MW Windmill project.

In case of Conductors, the Company aims to take advantage of the current market scenario and become a key supplier of conductors. It also plans to expand its conductors manufacturing capacity to 1,50,500 MT p.a. from the current capacity of 50,500 MT p.a. Along with the proposed expansion, the Company also proposes to increase its rod manufacturing facility to 1,22,000 MT p.a. from the present 32,000 MT p.a.

In case of Medium Voltage Cables, the Company proposes to put up additional 3 lines, each with an installed capacity of 2,500 kms totaling to 7,500 kms which will augment the current capacity of 5,600 kms to 13,100 kms.

The Company has added a new feather to its cap by setting up the first testing laboratory in India to test Extra High Voltage Cable up to 500 KV. This laboratory is a state of art and equipped with latest technology which will enable the Company to test EHV Cables up to 500 KV within the Company.

Taking steps forward to compete with our Competitors in today's tech savvy world the Company is planning to shift from manual to automatic process which will ensure highest level of productivity and minimum level of handling and processing errors. This system will be time as well as cost effective. Further with respect to futuristic vision, the Company is planning for backward and forward integration for raw materials and packaging which will minimize the Company's cost.

FINANCIAL STATEMENTS

The Ministry of Corporate Affairs (MCA) vide notification no. S.O. 447(E) dated 28th February, 2011 amended the existing Schedule VI to the Companies Act, 1956.

The Revised Schedule VI is applicable from financial year commencing from 1st April, 2011. The financial statements of our Company for the year ended 31st March, 2012 have been prepared in accordance with the Revised Schedule VI and accordingly, the previous year's figures have been reclassified/ regrouped to conform to this year's classification.

Our Directors have pleasure in attaching the Consolidated Financial Statements pursuant to Clause 32 of the Listing Agreement entered into with the Stock Exchanges and prepared in accordance with the Accounting Standards prescribed by the Institute of Chartered Accountants of India, in this regard.

SUBSIDIARY COMPANIES

M/s. Diamond Power Transformers Limited and M/s. Diamond Power Global Holdings Limited are wholly owned subsidiaries of our company.

Diamond Power Transformers Limited

Diamond Power Transformers Limited has performed well and has achieved 100% growth in turnover. The Company is one of the core suppliers of transformers to the clients like BHEL, Noida Power, and Electricity Boards etc. The Company expects to achieve higher growth with addition of varied size and rating of transformers.We are pleased to inform to our shareholders about the acquisition of strategic stake by Diamond Power Transformers Limited in Maktel Control and Systems Private Limited and Maktel Power Limited (formerly known as Danke Control Private Limited) as a measure of expanding its current operations in July 2012.

The Accounts of M/s. Diamond Power Transformers Limited, Wholly Owned Subsidiary Company, together with the reports of the Directors and the auditors, as required under Section 212 of the Companies Act, 1956, are attached with this annual report.

Diamond Power Global Holdings Limited

Diamond Power Global Holdings Limited was incorporated on 3rd November, 2011 as a 100% subsidiary of Diamond Power Infrastructure Limited in Jebel Ali Free Zone (JAFZA), Dubai, U.A.E. to promote exports of the Company in the Middle East. The company being a toddler is taking steps towards attaining its object successfully and in years to come is expected to achieve the desired results.

As the Company was incorporated on 3rd November, 2011 annual accounts for the same will be provided to the Shareholders from next year onwards.

DIRECTORS

In accordance with the Companies Act, 1956 and the Articles of Association of the Company Shri S N Bhatnagar, Shri Amit Bhatnagar and Shri Sumit Bhatnagar retire by rotation at the Annual General Meeting. However, they are eligible for re-appointment. Shri Bhavin Shah who was appointed as a Non-Executive Director by the Board will retire at this Annual General Meeting and the Company has also received his candidature for re-appointment as a Non-Executive Director of the Company.

Further during the year under review following Directors were retired and appointed:

SHRI N N BHATNAGAR

Shri N N Bhatnagar joined our Company on 31st October, 2008 as an Independent Director. Due to his pre occupation he opted for retirement from the Company in the last Annual General Meeting held on 20th September, 2011. Shri Bhatnagar served as a Member in the Audit Committee and Investors' Grievances Committee. His suggestions and guidance have indeed proved to be very effective in the progress of the Company. The company will always be thankful to him to guide it like a lamp in the dark.

SHRI VAMESH CHOVATIA

Shri Vamesh Chovatia joined our Company as on 10th January, 2011as a Non-Executive Director and a representative of Kotak India Growth Fund II, Non- Financial Institution. Due to his prior commitments he resigned from the Company on 30th May, 2011. The Company appreciates the directions and support given by him.

SHRI BHAVIN SHAH

Shri Bhavin Shah joined our Company as on 9th November, 2011 as a Non-Executive Director and replaced Shri Vamesh Chovatia as the representative Director of Kotak India Growth Fund II, Non-Financial Institution.

SHRI ASWINI SAHOO

Shri Aswini Sahoo joined our Company as on 30th June, 2009 as a Nominee Director for Clear Water Capital (CCP) and resigned on 27th March, 2012. He has been associated with our Company for the past four years. In these years, the Company has been able to nail down many opportunities that have come its way with the help of his suggestions and guidance. The Management would like to extend its gratitude to him regarding his valuable suggestions to the Company.

SHRI KARTHIK ATHREYA

Shri Karthik Athreya joined our Company as on 3rd April, 2012 as a Nominee Director of Clear Water Capital Partners (Cyprus) in place of Shri Aswini Sahoo.

STATUTORY AUDITORS

M/s. Vijay N. Tewar & Company, Chartered Accountants and Statutory Auditors of the Company, retire at the forthcoming Annual General Meeting and are eligible for re-appointment. A certificate has been obtained from them to effect that, the appointment, if made, will be in accordance with the limits specified in sub-section (1B) of Section 224 of the Companies Act, 1956.

AUDITORS' REPORT

The Auditors' Report to the shareholders does not contain any qualification.

DUE DILIGENCE REPORT

M/s. Swati Bhatt & Co., Practicing Company Secretary conducted Due Diligence Audit and has submitted the Report confirming compliance with the applicable provisions of Companies Act, 1956 and other rules and regulations issued by SEBI / other regulatory authorities for Corporate law.

COST AUDITOR

Pursuant to the direction from the Ministry of Corporate Affairs for appointment of Cost Auditors, our Board has reappointed M/s.S. S. Puranik & Associates, as the Cost Auditor of our Company for the financial year 2011-12 to conduct the audit of the cost records of the Company.

DEBENTURES

During the year under review, the Company has issued Non-Convertible Debentures amounting to Rs.32 Crores in addition to Rs. 68 Crores issued in financial year ended on 31st March, 2011 comprising of Rs. 1 Lacs Each at the rate of 12%, 12.25%, 12.35%, 12.50% and 12.75% to the respective Debenture Holders. M/s. Unit Trust of India Investment Advisory Services Limited was appointed as Debenture Trustee of the Company.

Any member interested in obtaining any information regarding Debentures or Debenture holders may write to the Company Secretary at the Corporate Office of the Company.

FIXED DEPOSITS

The company has not accepted any deposits from public during the year under review to which provisions of Section 58A of the Companies (Acceptance of Deposits) Rules, 1975 as amended is applicable.

INSURANCE

All the insurable interests of our Company including inventories, buildings, plant and machinery and liabilities under legislative enactments are adequately insured.

PESONNEL

The Board of Directors wishes to express their appreciations to all the employees for their outstanding contribution to the operations of the Company during the year. Any member interested in obtaining a copy of the Statement of Particulars of employees referred to in Section 217(2A) of the Companies Act, 1956,may write to the Company Secretary at the Corporate Office of the Company.

LITIGATION

We have a core and competent team of legal department who instantaneously looks after all the material litigations. However,during the year 2011-12 under review there were no material litigations against our company.

Further our directors would like to clarify that, the searches and surveys were carried out by Income Tax Department at the premises on some Group Companies only and promoters' residences for the first time in the last 43 years on15th and 16th March, 2012. We being strong believers of Corporate Governance Policy appreciate the concern showed by the Income Tax Department and are thankful to all the stake holders including IT Department to have faith in us. No major tax liability in our opinion is expected on Diamond Power Infrastructure Limited.

QUALITY CONTROL

It is the quality of our work which will please our Customers and not the quantity. The Company is committed to establish, sustain and strengthen the quality management system in each sphere of its operation, aiming at total customers' satisfaction.

To achieve this, it will be an endeavor of the Company to strive towards producing impeccable products, ensuring timely delivery and providing quality services to our valued customers.

In terms of quality, the Company is certified by ISO 9001- 2008.

ENVIRONMENT& SAFETY

The Company has given high priorities to Environment and Safety. A number of initiatives have been taken to embed a culture of safety and safe working practices in the organisation. A detailed corporate safety action plan has been prepared, including the activities that will be guided and supervised by the Management.

The Company is dedicated to pro-actively comply with the Statutory, legal and other requirements related to environment, safety and occupational health as pertinent to various processes, to ensure lowest pollution levels and safe working environment throughout the organization.

We are striving to prevent accidents and injuries, lower the incidences of occupational and ill health issues across the Company by identification and documentation of all environmental aspects as well as hazard risks.

The Company is certified by ISO 14001:2004 - for Environmental Management System and OHSAS 18001:2007 for Occupational Health and Safety Management Systems.

RISK MANAGEMENT

As part of the Risk Management Process, during the year, the Company reviewed the various risks and finalized mitigation plans. These were reviewed periodically by the Management and closely monitored and reviewed the risk plans periodically. Employees play a very vital role by contributing to the risk identification process.

CORPORATE GOVERNANCE

As per the requirement of Clause 49 of the Listing Agreement entered into with the Bombay Stock Exchange Ltd and National Stock Exchange of India Limited, a detailed report on Corporate Governance is set out as Annexure -A to this report. The Statutory Auditors of the Company have examined the Company's Compliance in this regard and have certified the same. As required under the SEBI Guidelines, such certificate is reproduced as Annexure-B to this Report. A separate Management Discussion and Analysis Report on the company's performance is given as Annexure-C to this report.

The declaration given by the Managing Director and Joint Managing Director with regard to compliance of Company's Code of Conduct by the Board members and senior management is available on our website www.dicabs.com.

CORPORATE SOCIAL RESPONSIBILITY VOLUNTARY GUIDELINES

MCA had released a set of guidelines on Corporate Social Responsibility (CSR) in December 2009. The Company is substantially complying with the guidelines laid down. The activities carried out by the Company as a part of its CSR initiatives are briefly described in this Annual Report. The detailed CSR activity of the Company is also available on the Company's website www.dicabs. com.

DIRECTORS' RESPONSIBILITY STATEMENT

Under Section 217(2AA) of the Companies Act, 1956, the directors confirm that:

a) In the preparation of Annual Accounts, the Company has followed the applicable Accounting Standards issued by the Institute of Chartered Accounts of India along with proper explanation relating to material departures;

b) Such accounting policies have been selected and consistently applied and judgments and estimates made thus are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company for the year ended 31st March, 2012 and of the Profit /Loss for the year ended on that date;

c) Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956, for safe guarding 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.

CONSERVATIONS OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE

The particulars relating to Conservation of Energy, Technology Absorption, Foreign Exchange Earning and Outgo as required under Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosures of Particulars in the Report of Board of Directors) Rules, 1988, is given this report.

ACKNOWLEDGEMENT

Our Directors would like to express their grateful appreciation for the assistance and co-operation, received from the Banks, Financial Institutions, various government authorities, customers, vendors and shareholders during the year. Our Directors also wish to place on records the deep sense of gratitude for the committed services of the executives, staff members and workers.



For and On Behalf of

the Board of Directors

Date: 13th August, 2012 (S. N. Bhatnagar)

Place: Vadodara Chairman


Mar 31, 2011

To the Members,

The Directors are pleased to present the Ninteenth Annual Report together with the audited accounts of the Company for the year ended March 31, 2011.

Financial Results

(Rs. in lakh)

2009-10 2010-11

Income 76,789.34 1,30,818.46

Expenditure 66,808.66 1,14,877.44

Gross Profit / (Loss) before Interest, Depreciation & Tax 9,980.69 15,941.33

Interest 2,362.26 2,487.77

Depreciation 649.29 1,500.59

Profit / (Loss) after Depreciation & Interest before Tax 6,969.14 11,952.97

Share Capital 3,006.27 3,720.63

Reserves & Surplus 26,615.60 47,906.80

EPS 18.02 26.24

Important performance parameters

(Rs. in lakh)

2009-10 2010-11

Gross Profit Margin (%) 13.97 12.06

Asset Turnover (times) 1.26 1.32

Interest Coverage (times) 4.23 6.41

Earning per Shares (diluted) (Rs.) 18.02 26.24

Dividend

In view of substantial growth and good financial performance during the year, the Board has recommended dividend of Rs. 3 per share (i.e. 30%), out of the profit of the financial year ended on 31st March, 2011 on 3,72,06,371 equity shares of Rs. 10.00 each fully paid up aggregating to Rs. 37,20,63,710.

MARKET & FUTURE OUTLOOK The Indian Power Industry

The critical role played by the power industry in the economic progress of a country has to be emphasized. A self sufficient power industry is vital for a nation to achieve economic stability. Electricity is one of the most vital infrastructure inputs for economic development of a country. There is a strong demand for electricity in India and it is steadily growing with the country's economic growth and rising consumerism. The Indian electricity market today offers one of the highest growth potential for private players. Government reforms, e.g. distribution network Reforms Program, would be the key factor driving the power sector. Reforms such as The Electricity Act and National Electricity Policy will give impetus to the Indian power sector.

According to research report of Indian Power Sector Analysis, there is a huge demand for power in some Indian states due to rapid urbanization and industrialization. Besides, opportunities for private players are increasing with high energy shortage and government support in the form of incentives to set up power plants. Number of merchant power plants will increase in the years to come with state governments inviting private players to invest in the power sector e.g. Gujarat, Maharashtra, Andhra Pradesh, etc.

The Indian power sector is experiencing a large demand-supply gap. At present, the energy shortage in India is ~10% but there are States where the energy shortage is as high as 25%. To combat this, over 80,000 MW of new generation capacity is planned in the next five years. A corresponding investment is required in Transmission and Distribution networks.

The Indian Ministry of Power has set a goal, "Mission 2012: Power for all" and released a comprehensive sector development blueprint. The main objectives, in addition to providing 100% access to power, are to provide sufficient power to achieve targeted GDP growth rate of 8%, provide reliable and good quality power and to enhance commercial viability.

A huge capital investment of about US$ 200 billion is required to meet Mission 2012 targets. This has welcomed numerous oportunities to the Indian Organisations to convert them in corporate giants. Additional massive capital investment is further required over the subsequent years with the country's power requirement expected to touch 800,000 MW by 2031-32.

Infrastructure Additions - Transmission:

The transmission of electricity is defined as bulk transfer of power over a long distance at high voltage. In India, bulk transmission infrastructure has increased from 3708 ckm in 1950 to more than 300,000 ckm up till now. The country has been divided into five regions for transmission of electricity. The planning of transmission system in the country had traditionally been linked to generation projects as part of an evacuation system. Ability of the power system to safely withstand a contingency without generation rescheduling or load-shedding was the main criteria for planning the transmission system.

Transmission planning has moved away from the earlier generation evacuation system planning to integrate system planning. While the predominant technology for electricity transmission and distribution has been Alternating Current (AC) technology, High Voltage Direct Current (HVDC) technology has also been used for interconnection of all regional grids across the country and for bulk transmission of power over long distances.

The country's transmission perspective program for 10th and 11th plan focuses on the creation of a National Grid in a phased manner by adding over 60,000 ckm of Transmission Network by 2012. Such an integrated grid shall evacuate additional 1, 00,000 MW by the year 2012 and carry 60% of the power generated in the country. The existing inter-regional power transfer capacity is 9,000 MW, which is to be further enhanced to 30,000 MW by 2012 through creation of "Transmission Super Highways".

The investment plan for achieving the target results spread in phased manner consisting three phases wherein 1st phase deals with interconnection between regional and thereby to achieve inter regional transfer, 2nd phase deals with inter regional connectivity through hybrid system consisting high capacity AC (765kV and HVDC) lines and third phase deals with strengthening of National grid through 765kV AC line.

Distribution Sector:

The T & D losses can be reduced substantially with further investment on T & D networks, which are presently in the range of 18% to 62% in various states and the aggregate technical and commercial (AT&C) losses are in the range of 50%. Reduction of these losses by undertaking distribution system improvement works requires heavy capital investments.

High technical losses in the system are primarily due to inadequate investments over the years for system improvement works, which has resulted in unplanned extensions of the distribution lines, overloading of the system elements like transformers and conductors, and lack of adequate reactive power support. By undertaking suitable system improvement schemes based on computer studies, it should be possible to bring down the technical losses in the distribution system to the level of 9%.

The commercial losses are mainly due to low metering efficiency, theft and pilferages. Improving metering efficiency, proper energy accounting & auditing and improved billing & collection efficiency may eliminate this. Fixing of accountability of the personnel / feeder managers may help considerably in reduction of AT&C Loss.

The Distribution Reform was identified as the key area to bring about the efficiency and improve financial health of the power sector. Ministry of Power took various initiatives in the recent past for bringing improvement in the distribution sector.

For giving boost to the reform program, the Ministry of Power formulated a six level intervention strategy for distribution reforms at National, State, SEB, Distribution Circle, Feeder and consumers levels to ensure accountability, deliverability and performance at all level.

Accelerated Power Development Reform Program (APDRP)

Keeping in mind the main objective to minimize distribution loss, the Government introduced the program for solving the problem of power sector with the vision of supplying reliable, affordable and quality power for all users by 2012. More emphasis is on up-gradation of sub-transmission and distribution through 100% metering, reducing T&D losses, energy audits, power factor correction measures etc. A qualitative improvement in power supply at the consumer end was expected so as to raise the level of satisfaction besides improving revenue realization for the utilities.

Cable Industry in India

Cables manufactured in India includes PVC/FRLS cables, XLPE cables, submarine cables, aerial bunched conductor cable, telecommunication cable such as jelly filled cables, optical fiber cables, Housing wiring etc. The cable industry may be mainly divided into four segments viz; house wiring (up to 4-40V), LT (1.1 to 3.3kV), HT (11 to 66kV), EHV (132kV and above).

There is a definite upward technological movement along with the growth rate in cables and wire industry in India.

Abnormal fluctuation in the major raw material costs namely aluminum, copper, XLPE, PVC compounds accounting to around 60% of the production cost, is highest cause of concern. In addition to that competition from abroad based manufacturers is posing real threat to the Indian cable manufacturers.

However, increase in government spending on the infrastructure and restructuring of SEBs, driving demand for various products and one of them is cables. Cables are needed for almost every new construction. Demand from power sector for laying new lines and upgrading the existing power distribution network across the country is clearly driving up the demand for cables.

Conductor Industry in India

Aluminum Conductors are used in transmission and distribution systems to carry the general electrical energy from generating station to the end users. The network is known as transmission and distribution systems. The Transmission system delivers bulk power from power station to the load centers and large industrial consumers beyond the economical service range of the regular primary distribution lines, where as distribution system delivers power from power sector or sub stations to various consumers. This transmission and distribution can employ either overhead systems or underground systems. Aluminum conductors are used for overhead systems.

TYPES OF ALUMINUM CONDUCTORS

- All Aluminum Conductors (AAC)

- All Aluminum Alloy Conductors (AAAC)

- Aluminum Conductors Steel reinforced (ASCR)

- Ariel Bunch Conductors (ABC)

In terms of length, transmission conductors account for around 19% and the balance 81% is accounted for by distribution conductors. By weight, transmission and distribution conductors each have a share of 50%. For transmission, ACSR accounts for 92% and the balance 8% AAAC. For distribution, AAAC conductors account for 55%, ASCR 32% ABC 7% and AAC 6% (Source: AC Nielson Report).

Typically around 4-0% of the transmission projects cost accounts for conductors, 20% for Towers and balance 4-0% for others. Therefore, out of the planned investment of Rs. 125,000 crores during the 11th five year plan, potential demand for conductors is estimated at whopping Rs. 50,000 crores in the next five years. According to the survey done by AC Nielson during 2005-06, the total demand for aluminum conductor is expected to reach 1.2 mn mt in 2010 from 730,000 mtpa, at a CAGR of 18%.

Subsidiary's Performance

M/s. Diamond Power Transformers Ltd. is only wholly owned subsidiary of your company, which has performed well and achieved 100% growth in turnover. The Company is one of the core suppliers of transformers to the clients like BHEL, Noida Power, Electricity Boards etc. The Company expects to achieve higher growth with addition of varied size and rating of transformers.

Current Activities

The company has established its position firmly in the top few companies in the field of electric industry with multi-products under one roof. It gives me a sense of pride in informing you that your company has commenced first of its kind of Extra High Voltage cable Plant to Manufacture 550 KV Cables.

In respect of Apex Electricals Limited, a company where your company is working as Strategic Investor, I would like to inform that there were certain further information, explanations required by the Board for Industrial and Financial Reconstructions (BIFR) which were provided by the company and the Operating Agency namely IDBI has submitted its final report to the BIFR and the scheme is now in progress for circulation for approval of the scheme.

Expansion plans

The Company is working on further expansion of its existing conductor division to expand its capacity from 50500 MT to 250000 MT and Medium Voltage facility both amounting to an aggregate of Rs. 1390 crore. These facilities will be coming at the existing location and will be completed by the year 2014-.

Subsidiary

The Accounts of Diamond Power Infrastructure Ltd.'s subsidiary namely M/s. Diamond Power Transformers Ltd, together with the reports of the directors and the auditors, as required under section 212 of the Companies Act, 1956 are attached.

MANAGEMENT DISCUSSION AND REPORT OF THE DIRECTORS ON CORPORATE GOVERNANCE

As per the requirement of Clause 4-9 of the Listing Agreements entered into with the Bombay Stock Exchange Ltd and National Stock Exchange of India Ltd., a detailed report on Corporate Governance is set out as Annexure A to this report. The Statutory Auditors of the Company have examined the Company's Compliance in this regard and have certified the same. As required under the SEBI Guidelines, such certificate is reproduced as Annexure-B to this Report. A separate Management Discussion and analysis report on the company's performance forming part of this report.

DIRECTORS' RESPONSIBILITY STATEMENT

Under Section 217(2AA) of the Companies Act, 1956, the directors confirm that:

a) In the preparation of Annual Accounts, the Company has followed the applicable Accounting Standards issued by the Institute of Chartered Accounts of India along with proper explanation relating to material departures;

b) Such accounting policies have been selected and consistently applied and judgments and estimates made thus are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company for the year ended 31st March, 2011 and of the Profit for the year ended on that date;

c) Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 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.

DIRECTORS

In accordance with the Companies Act, 1956 and the Articles of Association of the Company Shri N N Bhatnagar retires by rotation at the ensuing annual general meeting.

Shri Ranvir Singh Shekhawat was appointed as an Additional Directors of the Company with effect from October 23, 2010 in terms of Section 260 of the Companies Act, 1956, read with Article 128 of the Article of Association of the Company holds his office up to this Annual General Meeting and the Company has received a notice from a member under the provisions of Section 257 of the Companies Act, 1956, proposing his candidature for his appointment as Director of the Company. All the necessary resolutions for appointment, re-appointment of the directors have been included in the notice calling the forthcoming Annual General Meeting.

AUDITORS

M/s. Vijay N. Tewar& Company, Chartered Accountants and Statutory Auditors of the Company, retire at the forthcoming annual general meeting and are eligible for re-appointment. A certificate has been obtained from them to effect that, the appointment, if made, will be in accordance with the limits specified in sub-section (1B) of section 224- of the Companies Act, 1956.

FIXED DEPOSITS

The company has not accepted any deposits from public during the year under review to which provisions of section 58A of the Companies (Acceptance of Deposits) Rules, 1975 as amended is applicable.

CONSERVATIONS OF ENERGY, TECHNOLOGY ABSORPTIONS AND FOREIGN EXCHANGE

The particulars relating to Conservation of Energy, Technology Absorption, Foreign Exchange Earning and Outgo as required under section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosures of Particulars in the Report of Board of Directors) Rules, 1988, is given in Annexure C .

PERSONNEL

Any member interested in obtaining a copy of the Statement of Particulars of employees referred to in section 217(2A) of the Companies Act, may write to the Company Secretary at the Registered Office of the Company.

ACKNOWLEDGEMENT

Your Directors would like to express their grateful appreciation for the assistance and co-operations received from the Banks, Financial Institutions, various government authorities, customers, vendors and shareholders during the year. Your Directors also wish to place on records the deep sense of appreciation for the committed services of the executives, staff and workers.

For and On Behalf

of the Board of Directors

Date: 4th August, 2011 (S. N. Bhatnagar)

Place: Vadodara Chairman







 
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