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Directors Report of Emco Ltd.

Mar 31, 2015

To

The Members of EMCO Limited,

The Directors take immense pleasure in presenting their 50th Annual Report on the business and operations of the Company and statement of accounts for the year ended 31st March 2015.

Financial Summary/Highlights

During the financial year, the performance of the Company is as under:

(Amounts in Rs. Lakhs)

Particulars Standalone

2014-15 2013-14

Total Income 91,243.29 83,825.75

Profit Before Taxation 607.02 1,082.98

Less: Provision for Tax – Current 179.57 61.58

Deferred Tax 263.31 376.13

Earlier Year Tax 18.26 -

MAT Credit Entitlement (179.57) (61.58)

Profit After Taxation 325.45 706.85

Add: Balance brought forward from previous year 20,964.90 20,334.26

Profit Available For Appropriation 21,290.35 21,041.11

APPROPRIATIONS:

Proposed Dividend 67.58 65.14

Tax on Proposed Dividend 13.76 11.07

Balance carried to Balance Sheet 21,209.01 20,964.90

TOTAL APPROPRIATION: 21,290.35 21,041.11

Overview of Company's Financial Performance

During the year under review, Income from Sales and Services was Rs. 91,243 Lakhs against Rs. 83,826 Lakhs in the previous year.

The Company has earned a net Profit of Rs. 325 Lakhs in the current financial year against the net Profit of Rs. 707 Lakhs in the previous financial year.

Transfer to reserves

During the financial year, the Company did not transfer any amount to reserve.

Dividend

Considering the past performance of the Company and to maintain the consistent track record of dividend, your Directors are pleased to recommend for your approval a dividend of 10 paisa per equity share of Rs. 2/- each for the financial year 2014-2015 out of the current year's Profit.

Change in the nature of business

There was no change in the nature of business of the Company during the financial year.

Public Deposits

During the financial year 2014-15, your Company has not accepted any deposit within the meaning of Sections 73 and 74 of the Companies Act, 2013 read together with the Companies (Acceptance of Deposits) Rules, 2014.

Subsidiaries and Joint venture Companies

Pursuant to Section 136 of the Companies Act, 2013, the audited accounts of each of the Company's subsidiaries are placed on the website of the Company. If any Member of the Company so desires, the Company will be happy to make available the Annual Accounts of the subsidiaries to him/her, on request. The physical copies of the aforesaid documents will also be available at the Company's Registered Office for inspection during normal business hours on all working days, excluding Saturdays.

Consolidation of Accounts

The performance and financial position of each of the subsidiaries, associates and joint venture companies are detailed in 'Statement containing salient features of the financial statement of subsidiaries/associate companies/ joint ventures' in form AOC I pursuant to Section 129 of the Companies Act, 2013 and given in 'Annexure A' to this report.

Directors and Key Managerial Personnel

During the financial year, Mr. Rajesh S. Jain (DIN: 00005829), Whole Time Director (WTD) designated as Chairman of the Company was going to be ceased his term as WTD on October 19, 2014.

The Nomination and Remuneration Committee of the Board of Directors had recommended to the Board for re-appointment of Mr. Rajesh S. Jain as WTD for the period of 3 years. The Board on recommendation of said committee had approved the same and recommended to the Members for their approval. Accordingly, the Members at their Annual General Meeting held on August 08, 2014 accorded their approval for such appointment.

Pursuant to the provisions of Section 152 of the Companies Act, 2013 and in accordance with the Articles of Association of the Company, Mr. Rajesh S. Jain, WTD of the Company, retires by rotation at the ensuing Annual General Meeting and being eligible, offer himself for re-appointment.

During the year under review, on account of health issues Mr. K. N. Shenoy (DIN:00021373), Independent Director, resigned on May 14, 2014 from the Board of the Company. Further, the Board at their meeting held on October 17, 2014 appointed Mr. Amit Sudhakar as the Chief Financial Officer (CFO) of the Company in place of Mr. Ram Mundra who resigned as CFO on September 29, 2014.

Mr. Ganesh Tawari was appointed as the Company Secretary of the Company on February 26, 2015 in place of Mr. Pravin Kumar who resigned as Company Secretary on August 30, 2014.

Mr. K. N. Shenoy, Independent Director of the Company expired on August 18, 2014. The Board has placed on record it appreciation for the valuable contribution made and support extended by Mr. K. N. Shenoy during his tenure.

The Board has placed on record its appreciation for the valuable contribution made and support extended by Mr. Ram Mundra and Mr. Pravin Kumar during their respective tenure.

Pursuant to the provisions of Sections 149, 152 and 161 of the Companies Act, 2013, Mrs. Priyamvada Bhumkar (DIN: 00726138) was appointed as an Additional Director (Woman – Independent Director) of the Company. The Company has received a notice in writing from a member along with requisite deposit under Section 160 of the Companies Act, 2013, proposing her candidature for the Office of Director. Your Directors recommend her appointment for a term of 5 (five) years.

Re-appointment of Independent Directors

Pursuant to Section 149 and other applicable provisions, if any, of the Companies Act, 2013 and rules framed there under, Mr. S. V. Deo (DIN:00210554), Mr. Bherulal Choudhary (DIN:00011905) and Mr. Sanjay Bhatnagar (DIN:00867848), Independent Directors of the Company will be completing their first term of appointment on the Board at the ensuing Annual General Meeting of the Company. The Company has received notices in writing from a member along with requisite deposit under Section 160 of the Act, proposing their candidatures for the Office of Director. Your Directors recommend their re-appointment for a next term of 5 (five) years by passing a special resolution separately for each one of them.

The brief profiles of the Directors as required under Clause 49 of the Listing Agreement entered with the Stock Exchange(s) are disclosed in the notice convening 50th Annual General Meeting.

Declaration by independent directors

The Company has received necessary declaration from each independent director under Section 149(7) of the Companies Act, 2013, that he/she meets the criteria of independence laid down in Section 149(6) of the Companies Act, 2013 and Clause 49 of the Listing Agreement.

Significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and company's operations in future

During the financial year, there were no such orders passed by the regulators or courts or tribunals impacting the going concern status and company's operations in future.

Adequacy of Internal Financial Control

The Board has adopted the policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to the Company's policies, the safeguarding the assets, the prevention and detention of frauds and errors, the accuracy and completeness of the accounting records, and timely preparation of reliable financial disclosure.

Composition of Audit Committee

The Audit Committee comprises of three Non-Executive Directors, all of whom are Independent Directors. The Chairman and other Members of the Committee are having ability to read and understand financial statement. Besides, all members have knowledge of finance, accounting and law. Composition of the Audit Committee during the financial year 2014-2015 is as follows:

Sr. No. Name of the Committee Members Designation

1 Mr. Sanjay Bhatnagar Chairman

2 Mr. Bheru Choudhary Member

3 Mr. S. V. Deo Member

There were no matters during the financial year 2014-2015, wherein the Board did not accept recommendations given by the Audit Committee.

Establishment of Vigil Mechanism

The Company has established and adopted Vigil Mechanism and the policy thereof for directors and employees of the Company in accordance with the provisions of the Companies Act, 2013 as well as listing agreement. During the year under review, no personnel of the Company approached the Audit Committee on any issue falling under the said policy.

The vigil mechanism policy is available on the website of the company at link: http://www.emco.co.in/pdf/policy/Vigil%20 Mechanism%20Policy.pdf

Particulars of remuneration to employees

The particulars of remuneration to directors and employees and other related information required to be disclosed under Section 197 (12) read with Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules are given in 'Annexure B' to this Report.

Management Discussion and Analysis

The Management Discussion and Analysis forms part of the Directors' Report is annexed herewith as 'Annexure C'.

Auditors

a) Statutory Auditors

The Company's Auditors, M/s. P. Raj & Co.(FRN:108310W), and M/s. Chaturvedi & Shah (FRN:101720W), Chartered Accountants, Statutory Auditors hold Office up to the conclusion of the forthcoming 50th Annual General Meeting and being eligible, offer themselves for re-appointment. The Company has received letter from them giving their consent to act as Auditors of the Company and stating that their re-appointment, if made, would be within the prescribed limits under Section 139 of the Companies Act, 2013. Your Directors recommend their re-appointment for the second term of 2 years and 5 years respectively.

b) Secretarial Auditors

Makarand M. Joshi & Co., Practicing Company Secretaries, was appointed to conduct the Secretarial Audit of the Company for the financial year 2014-2015, as required under Section 204 of the Companies Act, 2013 and Rules thereunder. The secretarial audit report for financial year 2014-2015 forms part of the Directors Report as 'Annexure D' to the Board's report.

c) Cost Auditors

The Company has appointed M/s. Kishore Bhatia & Associates (FRN:00294), Cost Accountants, as Cost Auditors of the Company for the financial year 31st March, 2015 at a remuneration of Rs. 1 Lac. The Company maintains cost accounting records as required under Section 148 (1) of the Act. The Compliance certificate in this regard to be obtained from the Cost Accountants for the year ended 31st March 2015. Your Directors recommend to ratify remuneration payable to him for the year ended 31st March 2015 and 31st March 2016.

d) Internal Auditors

M/s. Rahul Birla & Company (FRN:122589W), Chartered Accountants, were appointed the Internal Auditors of the Company for the financial year 2014-15. Based on the recommendation of the Audit Committee of the Company, the Board of Directors has appointed M/s. Rahul Birla & Company, Chartered Accountants as the Internal Auditors of the Company for the financial year 2015-16.

Explanations by the Board on qualification, reservation or adverse remark or disclaimer made by the

- Auditors in their report

There were no qualification, reservation, disclaimer and adverse remarks made by the Auditors of the Company in their audit report.

- Company Secretary in practice in his secretarial audit report

The qualification given by the Company Secretary in practice in his secretarial audit report:

Sr. Observation Reply to the observation No.

1. The Company has made delay in filling of The delay in fling of Form- APR was inadvertent on the FORM–APR with respect to Overseas Direct part of the Company. Investment.

Employees Stock Option Scheme (ESOS)

Your Company has always worked on the idea that the greatest strength is its human resources and it is this resource, which makes your Company a force to reckon with in the highly competitive environment. With this view your Company has Employee Stock Option Scheme 2006, Employee Stock Option Scheme 2011 and newly introduced Employee Stock Option Scheme 2015 for the employees. The details of options under the said Schemes as on 31st March, 2015 pursuant to the provision of SEBI (Share Based Employee Benefits) Regulations, 2014 as amended are given below:

Sr No. Particulars ESOS 2006

a. Options Granted 3,99,850 options

b. Pricing formula Options have been granted at the closing market price of the Equity Shares of the Company one day prior to the date of grant.

c. Option vested 16,000 Options

d. Option exercised 38,000 Options

e. Total number of Ordinary shares arising out of the 1,90,000 Shares Options

f. Options lapsed 3,45,850 Options

g. Variation of terms of Options N.A.

h. Money realized by exercise of the Options Rs.171 Lakhs

i. Total number of options in force 16,000 Options

j (i) Detail of option granted to: senior management Name of employees are not disclosed personnel in view of sensitivity involved.

(ii) Any employee who receives in any one year of grant of N.A options amounting to 5% or more of options granted during the year (2014-15)

(iii) Employees who were granted options during any one - year, equal to or exceeding 1% of the issued capital of the Company at the time of the grant.

k. Diluted EPS calculated in accordance with Accounting - Standard 20 issued by ICAI for the year ended 31st March 2015

l. (i) Method of calculation of employee compensation Cost. Intrinsic Value

(ii) Difference between the employee compensation NA cost so compared at (i) above and the employee compensation cost that shall have been recognised if fair value of options had been used.

(iii) The impact of the difference on Profits and EPS of the NA Company for the year ended 31st March, 2015 had fair value of options had been used for accounting employee Options.

m. Weighted average exercise price and weighted average fair value of options granted during the year whose exercise price equals market price of stock on the grant date.

(there are no options granted whose exercise price NA either exceeds or less than the market price of the stock on the date of grant).

n. A description of the method and Significant assumptions used to estimate the fair values of options, including the following weighted average information:

i. Risk Free Interest Rate

ii. Expected Life

iii. Expected volatility

iv. Expected Dividends

The Price of the underlying share in market at the time NA of option granted

Sr No. Particulars ESOS 2006

a. Options Granted 25,90,000 options

b. Pricing formula Options have been granted at the closing market price of the Equity Shares of the Company one day prior to the date of grant.

c. Option vested 3,50,000 Options

d. Option exercised -

e. Total number of Ordinary shares arising out of the Options -

f. Options lapsed 12,40,000 Options

g. Variation of terms of Options N.A.

h. Money realized by exercise of the Options -

i. Total number of options in force 13,50,000 Options

j(i) Detail of option granted to: senior management Name of employees are not disclosed personnel in view of sensitivity involved.

(ii) Any employee who receives in any one year of grant of N.A options amounting to 5% or more of options granted during the year (2014-15)

(iii) Employees who were granted options during any one year, equal to or exceeding 1% of the issued capital of the Company at the time of the grant. -

k. Diluted EPS calculated in accordance with Accounting Standard 20 issued by ICAI for the year ended 31st March 2015 0.50

l.(i) Method of calculation of employee compensation Cost. Intrinsic Value

(ii) Difference between the employee compensation NA cost so compared at (i) above and the employee compensation cost that shall have been recognised if fair value of options had been used.

(iii) The impact of the difference on Profits and EPS of the NA Company for the year ended 31st March, 2015 had fair value of options had been used for accounting employee Options.

m. Weighted average exercise price and weighted average fair value of options granted during the year whose exercise price equals market price of stock on the grant date.

(there are no options granted whose exercise price NA either exceeds or less than the market price of the stock on the date of grant).

n. A description of the method and Significant assumptions used to estimate the fair values of options, including the following weighted average information:

i. Risk Free Interest Rate

ii. Expected Life

iii. Expected volatility

iv. Expected Dividends

The Price of the underlying share in market at the time NA of option granted ESOS 2011

Note: In view of the Sub division of the shares and in terms with the relevant provisions of ESOS – 2006 the Options stand adjusted along with entitlement to apply for 5 equity share of Rs. 2 each instead of one Equity shares of Rs. 10 each.

The Employee Stock Option Scheme 2015 was approved by the Members of the Company at their Extra Ordinary General Meeting held on 22nd January, 2015. However, the Company is yet to grant options out of this Scheme.

Extract of Annual Return

In accordance with Section 134(3)(a) of the Companies Act, 2013, an extract of the Annual return in the prescribed format is annexed herewith as 'Annexure E ' to the Board's report.

Number of Meetings of the Board

During the financial year, 9 (Nine) Board Meetings and 5 (Five) Audit Committee Meetings were held. The details of which are given in the Corporate Governance Report forming part of the Annual Report.

Directors' Responsibility Statement

Pursuant to the requirement of Section 134(3)(c) of the Companies Act 2013, with respect to the Directors' Responsibility Statement, it is hereby confirmed:

a) that in the preparation of the accounts for the financial year ended on 31st March, 2015, the applicable accounting standards have been followed along with proper explanation relating to material departures;

b) that the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2015 and of the Profit/ loss of the Company for the year ended on that date;

c) that the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act, for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

d) that the Directors had prepared the accounts for the financial year ended on 31st March, 2015 on a 'going concern' basis.

e) that proper internal financial controls were in place and that the financial controls were adequate and were operating effectively.

f) that systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.

Policy on directors' appointment and remuneration

Policy for Selection and Appointment of Directors and their Remuneration including criteria for determining qualifications, positive attributes, independence of a director and other matters under Sub-section (3) of Section 178 of the Companies Act, 2013, adopted by the Board, is given in the Corporate Governance Report forming part of this report.

Particulars of loans, guarantees or investments under Section 186

Your Company being engaged in providing infrastructural facilities, the provisions of Section 186 of the Companies Act, 2013 with regards to loan made, guarantee given or security provided is not applicable. Whereas investment made during the year has been disclosed in notes to accounts of the Financial Statement.

Particulars of contracts or arrangements made with related parties

There were no new contract or arrangements entered into by the Company with related parties referred to in sub-section (1) of Section 188 of the Companies Act 2013 during the financial year 2014-2015. Hence, particulars of related party contracts or arrangements in form AOC - 2 is not applicable

Corporate Governance Report

As required by clause 49 of the Listing Agreement with the Stock Exchange(s), a report on Corporate Governance and a certificate confirming compliance with requirement of Corporate Governance forms part of this Annual Report.

Training to Independent Directors

The Company had arranged a presentation on rights, duties and responsibilities of Independent Directors brought by the Companies Act, 2013 and listing agreement. The Independent directors of the Company attended the said presentation given by a practicing company secretary. The details of presentation is available at web link http://www.emco.co.in/other-information.html

Preferential allotment

The Members at their Extraordinary General Meeting held on 22nd January, 2015 passed a special resolution according their consent to the Board for issue and allotment of 24,39,025 equity shares of Rs. 2/- each at a premium of Rs. 39/- per share to EMCO Investments Private Limited, a promoter group company, on preferential allotment basis. Accordingly, the Board allotted EMCO Investments Private Limited 11,00,000 equity shares on 26th February, 2015 and 13,39,025 equity shares on 4th March, 2015. The Company has complied with all applicable provisions of the Companies Act, 2013, listing agreement and SEBI regulation.

Material changes and commitments affecting financial position between the end of the financial year and date of report

There are no material changes and commitments affecting financial position between the end of the financial year and date of report.

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

The particulars as prescribed under Sub-section (3)(m) of Section 134 of the Companies Act, 2013, read with the Companies (Accounts) Rules, 2014, are enclosed as 'Annexure F' to the Board's report.

Risk Management Policy and Compliance Framework

The Board at their Meeting held on 17th October, 2014 constituted the Risk Management Committee and adopted the Risk Management Policy with a majority of Board Members, the details of which are as follows:

Sr. No. Name of the Committee Members Designation

1 Mr. Rajesh Jain, Chairman 2 Mr. Shailesh Jain Member

3 Mr. Shyam Sunder Deo Member

4 Mr. Amit Sudhakar, Chief Financial Officer Member

5 Mr. Ganesh Tawari, Company Secretary / Compliance Officer Member

The Company is mainly engaged in the Engineering Procurement and Construction (EPC) projects and Transformer business. The Company continuously identifies and mitigates the arising risks through a robust risk identification and management system.

Details of some of the risks involved in the business are discuss below:

1) Commodity Risk

The Company deals with various commodities, such as steel, zinc, copper and aluminium. Fixed price contracts can have a negative impact if input costs rise, if it is not appropriately hedged in time. By adding price escalation clause in most of the contracts, the Company passes off such negative impacts to its client, partially or completely.

2) Currency Risk

The Company is exposed to the risk of currency fluctuations, if any exposure remains open. The Company believes in keeping its currency exposures hedged. It measures and manages these risks centrally and carries out periodic reviews of these risks; whenever required external experts are also consulted.

3) Execution Risk

Execution delay may results in cost overruns and may also negatively impact company's reputation. EPC projects could face delays due to external factors like Right of Way issues, manpower shortages, etc. The Company deploys a well- defined standard operating procedure (SOP) – from project planning to completion. It keeps a close watch and review these risks periodically and take timely course corrections.

Corporate Social Responsibility (CSR)

Detailed Information as required pursuant to the provisions of Section 134 of the Companies Act 2013, and Rule 9 of the Companies (Corporate Social Responsibility) Rules, 2014 is annexed herewith as 'Annexure G ' forming part of this report.

Board Evaluation

Clause 49 of the Listing Agreement mandates that the Board shall monitor and review the Board evaluation framework. The Companies Act, 2013 states that a formal annual evaluation needs to be made by the Board of its own performance and that of its committees and individual directors. Schedule IV of the Companies Act, 2013 states that the performance evaluation of independent directors shall be done by the entire Board of Directors, excluding the director being evaluated

The evaluation of all the directors and the Board as a whole was conducted based on the criteria and framework adopted by the Board. The evaluation process has been explained in the corporate governance report section in this Annual Report.

Insurance

All the assets of the Company are adequately insured.

Acknowledgment

Your Directors would like to express their grateful appreciation for the assistance, support and co-operation received from the Financial Institutions, Banks, Government Authorities and Shareholders during the year under review. Your Directors would also like to take this opportunity to express their appreciation to the dedicated and committed EMCOites for the contribution in trying to achieve the Company's vision to "To Build A World Class Company Through Reliability and Be A Great Place To Work".

On behalf of the Board of Directors

For EMCO LIMITED

Sd/-

Place: Mumbai Rajesh S. Jain

Date: 29th May, 2015 Chairman

(DIN:00005829)


Mar 31, 2014

The Directors take pleasure in presenting their 49th Annual Report on the business and operations of the Company and statement of accounts for the year ended 31st March 2014.

Your Directors pleased to inform you that the Company has achieved its 50 glorious year and celebrating this year as Golden Jubilee.

Financial Results

During the year the performance of the Company is as under:

(All amounts in Rupees Lakhs, unless otherwise stated)

Particulars Current Year Previous Year

2013-14 2012-13

Total Income 83,825.75 66,977.32

Profit Before Taxation 1,082.98 556.21

Less: Provision for Tax Current 61.58 Nil

Deferred Tax 376.13 267.76

Earlier Year Tax Nil Nil

MAT Credit Entitlement -61.58 Nil

Profit After Taxation 706.85 288.45

Add: Balance brought forward from previous year 20,334.26 20,198.23

Profit Available For Appropriation 21,041.11 20,486.68

APPROPRIATIONS:

Proposed Dividend 65.14 130.27

Tax on Proposed Dividend 11.07 22.15

Balance carried to Balance Sheet 20,964.90 20,334.26

TOTAL APPROPRIATION: 21,041.11 20,486.68 Review of Operations

During the year under review, Income from Sales and Services was Rs. 83,068 Lakhs against Rs. 66,881 Lakhs in the previous year.

The Company has earned a net profit of Rs. 707 Lakhs in the current financial year against the net profit of Rs. 288 Lakhs in the previous financial year.

Dividend

Considering the past performance of the Company and to maintain the consistent track record of dividend, your Directors are pleased to recommend for your approval a dividend of Rs. 0.10 paise on each share of face value of Rs. 2/- each for the financial year 2013-14 out of the current year''s profit.

Subsidiaries

The Company had five direct subsidiaries in the year under review, namely:- a) EMCO Power Limited,

b) EMCO Renewable Energy Limited,

c) Shekhawati Transmission Service Company Limited

d) EMCO Infrastructure Limited*

e) EMCO Overseas Pte Limited, Singapore

* The Company has acquired 100% Equity share capital of EMCO Infrastructure Limited from EMCO Power Limited w.e.f. October 18, 2013.

And two step-down subsidiaries, namely:- a) EMCO Transmission Networks Limited

(Formerly known as East West Power Generation Company Limited) b) PT Setenco Investa Niaga, Indonesia

In terms of general circular no. : 2/2011 issued on 8th February, 2011 by the Ministry of Corporate Affairs, Government of India under section 212 (8) of the Companies Act, 1956, a copy of Statement of Accounts along with the reports of the Board of Directors and Auditors Report of the above subsidiaries companies are not being attached with the Annual Report of the Company.

The Company will make available Annual Accounts of the subsidiary companies and related information to any members who may be interested in obtaining the same. The Annual Accounts of subsidiary companies will also be kept open for inspection at the Registered Office of the Company and that of the respective subsidiary companies between 10.00 A.M. to 12.00 Noon on any working day of the Company and its subsidiaries.

The Consolidated Financial Statements presented by the Company includes the financial results of the subsidiary companies.

Fixed Deposits

During the year under review the Company has neither invited nor accepted any fixed deposits from the public.

Directors

Mr. Rajesh S. Jain, a Whole Time Director(WTD) designated as Chairman of the Company, whose tenor as WTD will cease on October 19, 2014. The Nomination and Remuneration Committee of the Board of Directors has recommended to the Board for re- appointment of Mr. Rajesh S. Jain as WTD for the period of Three years subsequent to the date of cessation of their current tenure. The Board on recommendation of said committee has approved the same and recommended to the members for their approval at ensuing Annual General Meeting

Pursuant to the provision of Section 152 of the Companies Act, 2013 and in accordance with the Articles of Association of the Company, Mr. Shailesh S. Jain, Director of the Company, retire by rotation at the ensuing Annual General Meeting and being eligible, offer himself for reappointment.

Further pursuant to section 149, 152 and other applicable provision, if any of the Companies Act, 2013("Act") and rules framed there under, Mr. S. V. Deo, Mr. Bheru Choudhary and Mr. Sanjay Bhatnagar as Independent Directors of the Company are need to be reappointed for the period of one year with effect from August 8, 2014 and will hold office till the conclusion of next Annual General Meeting of the Company. The said appointment/re-appointment forms part of the notice convening 49th Annual General Meeting.

Mr. T. N. V. Ayyar, Independent Director of the Company has resigned from the Board of the Company with effect from March 26, 2014.

The brief profile of these Directors as required under Clause 49 of the Listing Agreement entered with the Stock Exchange(s), are disclosed in the notice convening 49th Annual General Meeting.

Management Discussion and Analysis

The Management Discussion and Analysis forms part of the Directors'' Report is annexed hereto.

Corporate Governance Report

As required by clause 49 of the Listing Agreement with the Stock Exchange(s), a report on Corporate Governance and a certificate confirming compliance with requirement of Corporate Governance forms part of this report.

Directors'' Responsibility Statement

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

(i) that in the preparation of the accounts for the financial year ended on 31st March, 2014, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

(ii) that the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2014 and of the profit of the Company for the year ended on that date;

(iii) that the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and

(iv) that the Directors had prepared the accounts for the financial year ended on 31st March, 2014 on a ''going concern'' basis.

Employees Stock Option Scheme (ESOS)

Your Company has always worked on the idea that the greatest strength is its human resources and it is this resource, which makes your Company a force to reckon with in the highly competitive environment. With this view your Company has an Employee Stock Option Scheme 2006 and Employee Stock Option Scheme 2011 for its employees. The details of options under the said Schemes as required under ESOP Disclosures to be made under Clause 12.1 of the Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 are given below:

Sr No. Particulars ESOS2006 ESOS 2011

a. Options Granted 3,99,850 options 24,90,000 options

b. Pricing formula Options have been granted at the closing Options have been granted at the closing

market price of the Equity Shares of the market price of the Equity Shares of the

Company one day prior to the date of Company one day prior to the date of

grant. grant.

c. Option vested 10,640 Options 3,09,500 Options

d. Option exercised 38,000 Options Nil

e. Total number of Ordinary shares arising out of the 1,90,000 Shares Nil Options

f. Options lapsed 3,45,850 Options 9,25,000 Options g. Variation of terms of Options N.A. N.A. h. Money realized by exercise of the Options Rs. 171 Lakhs Nil

i. Total number of options in force 16,000 Options 15,65,000 Options

j. (i) Detail of option granted to: senior management Name of employees are not disclosed in Name of employees are not disclosed in

personnel view of sensiti vity involved. view of sensitivity involved.

(ii) Any employee who receives in any one year of grant N.A N.A

of options amounting to 5% or more of options

granted during the year (2013-14)

(iii) Employees who were granted options during any Nil Nil

one year, equal to or exceeding 1% of the issued capital of the Company at the time of the grant. k. Diluted EPS calculated in accordance with Nil 1.08

Accounting Standard 20 issued by ICAI for the year ended 31st March 2014

l. (i) Method of calculation of employee compensation Intrinsic Value Intrinsic Value

Cost. (ii) Difference between the employee compensation NA NA

cost so compared at (i) above and the employee compensation cost that shall have been recognised if fair value of options had been used.

(iii) The impact of the difference on profits and EPS NA NA

of the Company for the year ended 31st March, 2014 had fair value of options had been used for accounting employee Options.

m. Weighted average exercise price and weighted NA NA average fair value of options granted during the year whose exercise price equals market price of stock on the grant date.

(there are no options granted whose exercise price

either exceeds or less than the market price of the

stock on the date of grant). n. A description of the method and significant NA NA

assumptions used to estimate the fair values of options, including the following weighted average

information:

i. Risk Free Interest Rate

ii. Expected Life

iii.Expected volatility

iv. Expected Dividends

The Price of the underlying share in market at the

time of option granted

Note: In view of the Sub division of the shares and in terms with the relevant provisions of ESOS – 2006 the Options stand adjusted along with entitlement to apply for 5 equity share of Rs. 2 each instead of one Equity shares of Rs. 10 each.

Particulars of Employees

In terms of the provisions of Section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975 as amended, the names and other particulars of employees are required to be set out in the annexure to the Directors'' Report. However as per the provisions of section 219 (1)(b)(iv) of the said Act, the Annual Report excluding the aforesaid information is being sent to all the members of the Company and others entitled thereto. Any member interested in obtaining such particulars may write to the Company Secretary.

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

Information as required under the provisions of Section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 is annexed to and forms part of this report.

Cost Accounting Records

Your Company is required to maintain cost accounting records in respect of manufacture of power transformers, transmission towers, electronic energy meters and generation of electricity from Wind Mill and Solar farm (Power) pursuant to the Companies (Cost Accounting Records) Rules, 2011. The Compliance certificate in this regard to be obtained from the Cost Accountants for the year ended 31st March 2014.

Auditors

The Company''s Auditors, M/s. P. Raj & Co., and M/s Chaturvedi & Shah Chartered Accountants Statutory Auditors hold office up to the conclusion of the forthcoming 49th Annual General Meeting and being eligible, offer themselves for re-appointment. The Company has received letter from them giving their consent to act as Auditors of the Company and stating that their re-appointment, if made, would be within the prescribed limits under Section 139 of the Companies Act, 2013. Your Directors recommend their re- appointment.

Insurance

All the assets of the Company are adequately insured.

Acknowledgement

Your Directors would like to express their grateful appreciation for the assistance, support and co-operation received from the Financial Institutions, Banks, Government Authorities and Shareholders during the year under review. Your Directors would also like to take this opportunity to express their appreciation to the dedicated and committed EMCOites for the contribution in trying to achieve the Company''s vision to "To Build A World Class Company Through Reliability and Be A Great Place To Work".

On behalf of the Board of Directors

For EMCO LIMITED

Sd/- Mumbai Rajesh S. Jain

April 25, 2014 Chairman


Mar 31, 2013

To, The Members of EMCO Limited,

The Directors take pleasure in presenting their 48th Annual Report on the business and operations of the Company and statement of accounts for the year ended 31st March 2013.

Financial Results

During the year the performance of the Company is as under:

(All amounts in X Lakhs, unless otherwise stated)

Current Year Previous Year Particulars 2012-13 2011-12

Total Income 66,977.32 80,991.85

Profi t Before Taxation 556.21 914.90

Less: Provision for Tax - Current Nil Nil

Deferred Tax 267.76 108.55

Earlier Year Tax Nil Nil

Profi t After Taxation 288.45 806.35

Add: Balance brought forward from previous year 20,198.23 19,543.28

Profi t Available For Appropriation 20,486.68 20,349.63

APPROPRIATIONS:

Proposed Dividend 130.27 130.27

Tax on Proposed Dividend 22.15 21.13

Balance carried to Balance Sheet 20,334.26 20,198.23

TOTAL APPROPRIATION: 20,486.68 20,349.63

Review of Operations

During the year under review, Income from Sales and Services was Rs. 66,881 Lakhs against Rs. 80,953 Lakhs in the previous year.

The Company has earned a net profi t of Rs. 288 Lakhs in the current fi nancial year against the net profi t of Rs. 806 Lakhs in the previous fi nancial year.

Dividend

Considering the past performance of the Company and to maintain the consistent track record of dividend, your Directors are pleased to recommend for your approval a dividend of Rs. 0.20/- paise on each share of face value of Rs. 2/- each for the fi nancial year 2012-13 out of the current year s profi t.

Subsidiaries

The Company had four direct subsidiaries in the year under review, namely:-

a) EMCO Power Limited,

b) EMCO Renewable Energy Limited,

c) Shekhawati Transmission Service Company Limited*

d) EMCO Overseas Pte Limited, Singapore

* The Company has acquired 100% Equity share capital of Shekhawati Transmission Service Company Limited (STSCL) from Rajasthan Rajya Vidyut Prasaran Nigam Limited (RRVPNL) w.e.f. February 01, 2013.

And four step-down subsidiaries, namely:-

a) East West Power Generation Company Limited

b) EMCO Infrastructure Limited

c) EMCO Edison Transformers (Pty) Limited, South Africa**

d) PT Setenco Investa Niaga, Indonesia

** The company has divested it s investment in EMCO EDISON TRANSFORMER PTY. LTD.

In terms of general circular no. : 2/2011 issued on 8th February, 2011 by the Ministry of Corporate Affairs, Government of India under section 212 (8) of the Companies Act, 1956, a copy of Statement of Accounts along with the reports of the Board of Directors and Auditors Report of the above subsidiaries companies are not being attached with the Annual Report of the Company.

The Company will make available Annual Accounts of the subsidiary companies and related information to any members who may be interested in obtaining the same. The Annual Accounts of subsidiary companies will also be kept open for inspection at the Registered Offi ce of the Company and that of the respective subsidiary companies between 10.00 A.M. and 12.00 Noon on any working day of the Company and its subsidiaries.

The Consolidated Financial Statements presented by the Company includes the fi nancial results of the subsidiary companies.

Fixed Deposits

During the year under review the Company has neither invited nor accepted any fi xed deposits from the public.

Directors

Pursuant to section 256 of the Companies Act, 1956 and in accordance with the Articles of Association of the Company, Mr. S.V.Deo and Mr. Bheru Choudhary, Directors of the Company, retire by rotation at the ensuing Annual General Meeting and being eligible, offer themselves for reappointment. The said appointment/re-appointment forms part of the notice convening 48th Annual General Meeting. The profi le of these Directors as required under section 49 of the Listing Agreement entered with the Stock Exchange(s), are given in the notice convening 48th Annual General Meeting.

Management Discussion and Analysis

The Management Discussion and Analysis forms part of the Directors Report is annexed hereto.

Corporate Governance Report

As required by clause 49 of the Listing Agreement with the Stock Exchange(s), a report on Corporate Governance and a certifi cate confi rming compliance with requirement of Corporate Governance forms part of this report.

Directors Responsibility Statement

Pursuant to the requirement of Section 217(2AA) of the Companies Act, 1956, with respect to the Directors Responsibility Statement, it is hereby confi rmed:

(i) that in the preparation of the accounts for the fi nancial year ended on 31st March, 2013, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

(ii) that the Directors had selected such accounting policies and applied them consistently and made judgements and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2013 and of the profi t/ loss of the Company for the year ended on that date;

(iii) that the Directors had taken proper and suffi cient care 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; and

(iv) that the Directors had prepared the accounts for the fi nancial year ended on 31st March, 2013 on a ‘going concern basis .

Employees Stock Option Scheme (ESOS)

Your Company has always worked on the idea that the greatest strength is its human resources and it is this resource, which makes your Company a force to reckon with in the highly competitive environment. With this view your Company has an Employee Stock Option Scheme 2006 and Employee Stock Option Scheme 2011 for the employees. The details of options under the said Schemes as required under ESOP Disclosures to be made under Clause 12.1 of the Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 are given below:

Insurance

All the assets of the Company are adequately insured.

Acknowledgement

Your Directors would like to express their grateful appreciation for the assistance, support and co-operation received from the Financial Institutions, Banks, Government Authorities and Shareholders during the year under review. Your Directors would also like to take this opportunity to express their appreciation to the dedicated and committed EMCOites for the contribution in trying to achieve the Company s vision to "To Build A World Class Company Through Reliability and Be A Great Place To Work".

On behalf of the Board of Directors

For EMCO LIMITED

Sd/-

Mumbai Rajesh S. Jain

9th May, 2013 Chairman


Mar 31, 2012

To,The Members of EMCO Limited,

The Directors take pleasure in presenting their 47th Annual Report on the business and operations of the Company and statement of accounts for the year ended 31st March 2012.

Financial Results

During the year the performance of the Company is as under:

(Rs. in Lakhs)

Current Year Previous Year

Particulars 2011-12 2010-11

Total Income 80,991.85 105,106.90

Profit Before Taxation 914.90 (6,561.14)

Less: Provision for Tax - Current NIL NIL

Deferred Tax 108.55 (2,114.57)

Earlier Year Tax NIL (23.30)

Profit After Taxation 806.35 (4,423.27)

Add: Balance brought forward from previous year 19,543.28 24,114.61

Profit Available For Appropriation 20,349.63 19,691.34

APPROPRIATIONS:

Proposed Dividend 130.27 130.27

Tax on Proposed Dividend 21.13 17.79

Balance carried to Balance Sheet 20,198.23 19,543.28

TOTAL APPROPRIATION: 20,349.63 19,691.34

Review of Operations

During the year under review, Income from Sales and Services was Rs. 80,953 lakhs against Rs. 104,947 lakhs in the previous year.

The Company has earned a net profit of Rs. 806 lakhs in the current financial year against the net loss of Rs. 4,423 lakhs in the previous financial year.

Dividend

Considering the past performance of the Company and to maintain the consistent track record of dividend, your Directors are pleased to recommend for your approval a dividend of 10% i.e. Rs. 0.20 per share (previous year 10% i.e. Rs. 0.20 per share) on face value of Rs. 2 each for the financial year 2011-12 out of the current year's profit.

Subsidiaries

The Company had three direct subsidiaries in the year under review, namely:-

a. EMCO Power Limited,

b. EMCO Renewable Energy Limited,

c. EMCO Overseas Pte Limited, Singapore And four step-down subsidiaries, namely:-

a. East West Power Generation Company Limited

b. EMCO Infrastructure Limited

c. EMCO Edison Transformer (Pty) Limited, South Africa

d. PT Setenco Investa Niaga, Indonesia

In terms of general circular issued by the Ministry of Corporate Affairs, Government of India under section 212 (8) of the Companies Act, 1956, a copy of Statement of Accounts along with the reports of the Board of Directors and Auditors Report of the above subsidiary companies are not being attached with the Annual Report of the Company.

The Company will make available Annual Accounts of the subsidiary companies and related information to any members who may be interested in obtaining the same. The Annual Accounts of subsidiary companies will also be kept open for inspection at the Registered Office of the Company and that of the respective subsidiary companies between 10.00 A.M. and 12.00 Noon on any working day of the Company and its subsidiaries.

The Consolidated Financial Statements presented by the Company includes the financial results of the subsidiary companies. Fixed Deposits During the year under review the Company has neither invited nor accepted any fixed deposits from the public.

Directors

Mr. Sanjay Bhatnagar was appointed as Non - executive Director by the Members of the Company at their Annual General Meeting held on 20th September 2011.

Further in the same meeting Mr. Rajesh S. Jain and Mr. Shailesh S. Jain were reappointed as Whole Time Director designated as Chairman and Vice Chairman for a period of three years with effect from 20th October 2011 and 19th October 2011 respectively.

Mr. Ajay Kumar Dhagat ceased to be Managing Director and Director of the Company with effect from 4th November 2011. The Board places on record its appreciation for the contribution made by Mr Ajay Kumar Dhagat during his tenure as Managing Director of the Company.

Pursuant to section 256 of the Companies Act, 1956 Mr. K N Shenoy and Mr. T N V Ayyar who retire by rotation and being eligible for reappointment, offer themselves for reappointment at the ensuing Annual General Meeting.

The above appointments/re-appointments forms part of the notice convening 47th Annual General Meeting. The profile of these Directors as required under Clause 49 of the Listing Agreement entered with the Stock Exchange(s), are given in the notice convening 47th Annual General Meeting.

Management Discussion and Analysis

The Management Discussion and Analysis forms part of the Directors' Report is annexed hereto.

Corporate Governance Report

As required by clause 49 of the Listing Agreement with the Stock Exchange(s), a report on Corporate Governance and a certificate confirming compliance with requirement of Corporate Governance forms part of this report.

Directors' Responsibility Statement

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

(i) that in the preparation of the accounts for the financial year ended on 31st March 2012, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

(ii) that the Directors had selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March 2012 and of the profit/ loss of the Company for the year ended on that date;

(iii) that the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and

(iv) that the Directors had prepared the accounts for the financial year ended on 31st March 2012 on a 'going concern' basis.

Employees Stock Option Scheme (ESOS)

Your Company has always worked on the idea that the greatest strength is its human resources and it is this resource, which makes your Company a force to reckon with in the highly competitive environment. With this view your Company has an Employee Stock Option Scheme 2006 and Employee Stock Option Scheme 2011 for the employees. The details of options under the said Schemes as required under ESOP Disclosures to be made under Clause 12.1 of the Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 are given below:

Sr No. Particulars ESOS 2006 ESOS 2011

a. Options Granted 3,99,850 options 13,90,000 options

b. Pricing formula Options have been granted at the Options have been granted at the

closing market price of the Equity closing market price of the Equity Shares of the Company one day prior Shares of the Company one day prior to the date of grant. to the date of grant.

c. Option vested 2,21,225 Options Nil

d. Option exercised 38,000 Options Nil

e. Total number of Ordinary shares arising 1,90,000 Shares Nil out of the Options

f. Options lapsed 3,23,850 Options 7,25,000 Options

g. Variation of terms of Options N.A. N.A.

h. Money realized by exercise of the Options ' 171 lakhs Nil

i. Total number of options in force 38,000 Options 665,000 Options

j (i) Detail of option granted to: senior Mary Mody : 8,000 B.J.Amritkar: 75,000

management personnel Neeraj Yadav: 8,000 Ganesh Tawari: 40,000

N.K.Mukherjee : 14,000 Deepak Khandelwal: 75,000 Ashok Bhambhani : 8,000 N K Mukherjee: 5,000

Ram Mundra: 40,000

Kishor Patel: 40,000

Ratnakar Wagh: 40,000

Anagha Dixit: 40,000

N K Paramal: 40,000

Mahesh Jagiasi: 40,000

Prashant Sahasrabudhe: 40,000

K P Singh: 75,000

R P Singh: 40,000

Kailash Agarwal: 75,000

(ii) Any employee who receives in any one Mary Mody B.J.Amritkar year of grant of options amounting to 5% Neeraj Yadav Deepak Khandelwal or more of options granted during the year (2011-12) N.K.Mukherjee K P Singh

Ashok Bhambhani Kailash Agarwal

(iii) Employees who were granted options Nil Nil during any one year, equal to or exceeding 1% of the issued capital of the Company at the time of the grant.

k. Diluted EPS calcu lated in accordance with 1.24 1.24 Accounting Standard 20 issued by ICAI for the year ended 31st March 2012

l.(i) Method of calcu lation of employee Intrinsic Value Intrinsic Value compensation Cost.

(ii) Difference between the employee NA NA compensation cost so compared at (i) above and the emp loyee compensation cost that shall have been recognised if fair value of options had been used.



Sr No. Particulars ESOS 2006 ESOS 2011

(iii) The impact of the difference on profits NA NA and EPS of the Company for the year ended 31st March, 2012 had fair value of options had been used for accoun ting employee Options.

m. Weighted average exercise price and NA NA weighted average fair value of op tions granted during the year whose exercise price equals market price of stock on the grant date.

(there are no options granted whose exercise price either exceeds or less than the market price of the stock on the date of grant).

n. A description of the method and NA NA

significant assum ptions used to estimate the fair values of options, including the following weighted average information:

(i) Risk Free Interest Rate

(ii) Expected Life

(iii) Expected volatility

(iv) Expected Dividends

The Price of the underlying share in market at the time of option granted

Note: In view of the Sub division of the shares and in terms with the relevant provisions of ESOS - 2006 the Options stand adjusted along with entitlement to apply for 5 equity share of Rs. 2 each instead of one Equity shares of Rs. 10 each.

Particulars of Employees

In terms of the provisions of Section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975 as amended, the names and other particulars of employees are required to be set out in the annexure to the Directors' Report. However as per the provisions of section 219 (1)(b)(iv) of the said Act, the Annual Report excluding the aforesaid information is being sent to all the members of the Company and others entitled thereto. Any member interested in obtaining such particulars may write to the Company Secretary.

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

Information as required under the provisions of Section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 is annexed to and forms part of this report.

Auditors

The Company's Auditors, M/s. P. Raj & Co., and M/s Chaturvedi & Shah Chartered Accountants (Joint Statutory Auditors) hold office up to the conclusion of the forthcoming 47th Annual General Meeting and being eligible, offer themselves for re-appointment. The Company has received letter from them giving their consent to act as Auditors of the Company and stating that their re- appointment, if made, would be within the prescribed limits under Section 224(1B) of the Companies Act, 1956. Your Directors recommend their re-appointment.

Cost Auditors

The Board of Directors pursuant to order issued by the Central Government under section 233B of the Companies Act, 1956 have appointed M/s Kishore Bhatia & Associates, Cost Accountants for the conducting the audit of the cost accounting records maintained by the company in respect of manufacture of power transformers, transmission towers, electronic energy meters and generation of electricity from Wind Mill and Solar farm (Power). The due date for submission of the Report is 27th September 2012.

Insurance

All the assets of the Company are adequately insured.

Acknowledgement

Your Directors would like to express their grateful appreciation for the assistance, support and co-operation received from the Financial Institutions, Banks, Government Authorities and Shareholders during the year under review. Your Directors would also like to take this opportunity to express their appreciation to the dedicated and committed EMCOites for the contribution in trying to achieve the Company's vision to "To Build A World Class Company Through Reliability And Be A Great Place To Work".

On behalf of the Board of Directors

For EMCO LIMITED

sd/-

Rajesh S. Jain

Chairman

Mumbai 15th May 2012


Mar 31, 2010

The Directors take pleasure in presenting their 45th Annual Report on the business and operations of the Company and statement of accounts for the year ended 31 st March 2010.

Financial Results

During the year the performance of the Company was as under:

(Rupees In Lakhs)

Current Year Previous Year

2009-2010 2008-2009

Total Income 103,137.91 105,906,15

Prof it Before Taxation 18,328.97 8,037.32

Less: Provision for Tax - Current 4,480.00 2,075.00

Fringe Benefit Tax - 85.00

Deferred Tax 275.38 567.24

Earlier Year Tax 193.93 -

Profit After Taxation 13,379.66 5,310.08

Add: Balance brought forward from previous year 13,566.60 10,387.56

Profit Available For Appropriation 26,946.26 15,697.64

APPROPRIATIONS:

General Reserve 1,400.00 750.00

Debenture Redemption Reserve 417.33 417.33

Proposed Dividend 866.98 823.72

Tax on Dividend 147.34 139.99

Balance carried to Balance Sheet 24,114.61 13,566.60

TOTAL APPROPRIATION 26.946.26 15,697.64

Review of Operations

During the year under review, Income from Sales and Services was Rs. 103,138 lakh against Rs. 105,906 lakh in the previous year. The volume In leims of MvA in transforms division stood at 13,692 MVA in the FY 2009-10 against 10,947 MVA in the previous FY, registering growth of 25%. The dQcline in sales value was mainly attributed to change in product mix coupled with decrease in realisation per MVA due to fall in the commodity prices. Profits before tax was Rs 18,329 lakh as against Rs. 8,037 lakh in the previous year. This include profit from extra-ordinary item of Rs. 12,735 lakh which was arising out of sale of 100% holding in EMCO Energy Limited, a wholly owned subsidiary of the Company. Profit after Tax for the year under review was Rs. 13,380 lakh as against Rs.5,310 lakh in the previous year. Earning per equity share was Rs. 22.72 as compared to Rs. 9.03 in the previous year.

Dividend

Your Directors are pleased to recommend for your approval, a dividend of 70% i.e Rs. 1.40 per share (Previous Year 70% i.e Rs. 1.40 per share) (face value of Rs. 2 per share) iw the year ended 31 st March 2010, aggregating to Rs. 1014 lakh (Previous year Rs, 964 |akh), inclusive of tax on distribution of dividend.

Subsidiary

The Company had three direct subsidiaries in the year /underreview, namely:-

a) EMCO were Limited,

b) EMCO Power lnta9av(uctureUmjted(

c) EMCO Overseas Pte limited, SiNGAPO And three step-down subsidiarit. name|y:_

a) East West Power Generation Co,.^ny Limited_

b) EMCO Infrastructure Limited*

c) EMCO Edison Transformer (Pty) Limited, Sou Africa

*The name of the Company is changed from Warora Power Company Limited to EMCO Infrastructure Limited on 27th October 2009.

In terms of approval granted by the Central Government under section 21 2 (8) of the Companies Act 1956, copy of Statement of Accounts along with the reports of the Board of Directors and Auditors Report of the above subsidiary companies have not been attached with the Annual Report of the Company.

These documents will be made available upon request by any member of the Company and its subsidiaries, interested in obtaining the same and a copy of the same is also available for inspection at the Companys corporate office and the registered office of the subsidiary companies between 10:00 A.M. and 1 2:00 Noon on any working day of the company and its subsidiaries, upto the date of the 45th Annual General Meeting.

Further as directed by Central Government, the financial data of the subsidiaries forms part of this Annual Report and the Consolidated Financial Statements of the Company and its subsidiary Companies, prepared in accordance with Accounting Standard 21 prescribed by The Institute of Chartered Accountants of India, forms part of the Annual Report.

During the year under review, the Company had sold its 100% holding in EMCO Energy Limited to GMR Energy Limited in order to unlock the value to pursue "larger opportunities in the power generation business. The Company, in order to fuel its power generation plans, had perceived this strategy after taking into consideration the changing scenario in the power sector in which the emphasis is essentially on large size projects to become competitive, cost efficient and environmental friendly. The decision has earned good return on investment and increased _your Companys networth and risk taking capability against future unforeseen events. However, the Company has only sold a project and not the business and therefore, entire core team and knowledge remains with the Company.

Fixed Deposits

During the year under review the Company has neither invited nor accepted any fixed deposits from the public.

Directors

At the Board meeting held on 19th April 2010, the Board of Directors had appointed Mr. Ajay Kumar Dhagat as an Additional Director of the Company with effect from the same date to hold the office till the date of ensuing Annual General Meeting. At the same meeting, Mr. Ajay Kumar Dhagat was appointed as Managing Director of the Company with effect from 19th April 2010 for three years that is upto 18th April 2013. The terms and conditions of his appointment, including his remuneration, are subject to approval of the members in the ensuing Annual General Meeting. He will be non-retiring Director till the time he continues as the Managing Director of the Company.

Mr. Anil Kumar Sardana was appointed as an Additional Director on 27thjanuary 2010 and is to hold the office till the date of ensuing Annual General Meeting. Considering his professional background and expertise, the Board is of the opinion that the appointment of Mr. Anil Kumar Sardana, as Director, will be beneficial to the Company.

In accordance with Section 256 of the Companies Act, 1 956 and the Articles of Association of the Company, Mr. S.V. Deo and Mr. Bheru Choudhary, Directors of the Company, are liable to retire by rotation at the ensuing Annual General Meeting and being eligible, offer themselves for reappointment.

Mr. R.S. Shah ceased to be a Director of the Company with effect from 19th April 2010 on expiry of his term as Director-Technical of the Company. The Board places on record its appreciation for the services rendered by Mr R.S. Shah during his tenure as Director of the Company.

The above appointments/re-appointments forms part of the Notice of the 45th Annual General Meeting. The profile of these Directors as required under Clause 49 of the Listing Agreement entered with the Stock Exchanges, are given in the notice of the 45th Annual General Meeting.

Management Discussion and Analysis

The Management Discussion and Analysis forms part of the Dworttirs Report and is annexed hereto.

Corporate Governance Report

As required by clause 49 of the listing agreement with ¦stock exchanges, a report on corporate governance and a certificate confirming compliance with requirement of corporate goverrnance forms part of this report.

Directors Responsibility Statement

Fusslmntton the requirement of Section 217(2AA) of the (Compariess AA. ct, 1956, with respect to the Directors IRe^aDTBtbl/tty Statement, it is hereby confirmed:

(o) that in the preparation of the accounts for the finacial Year ended on 31st March 2010, the applicable accounting standards have been folowed at ong with proper explanation relating tto maternalde epartures;

p) that the Directors had selected such accounting policies and appiied them consistently and made judgements and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for the year under review;

(iii) that the Directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) that the Directors had prepared the accounts for the financial year ended on 31 st March 2010 on a going concernbasis,

Employees Stock Opti on Scheme (6.SOS)

Your Company has always worked tin the idea that the greatest strength is its human resources and it is this resource, which makes your Cornpany a force o reckon with in the highly competitive environment, With this view your Company has an Employee Stock Option Scheme? 2006, for the employees, The details of options under the said Scheme as required under ESOP Disclosures to be rare tie under Clause 12,1 of the Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock* Purchase Scheme) Guidelines, 1999 are given below; Sl. No

1. Options Granted 305,850 Options

2. Prtclngiformulai Options have been granted at the closing market price of the

Equity Shares of the Company one day prior to the date of grant.

3. Options wasted 172,10O Options

4. Options exercised 38,000 Options

5. Total number of Ordenary Shars artaint 190,000 Shares

out of the Options

6. Options lapsed 131,900 Options

7. Variation of terms of. Options NA

8 Money realized of options in force Rs,17Lakh

Optitara

9 Total sumbe of options in force 1. 35.9500 options

10 Detail of option granted Acc Singh - 5,000 Options

I senior manegement Persons ML. Jain - 4,000 Options

Satish Copth - 6,000 Options

Sunitha - 6,000 Options



ii) Any employee who receives in any one NIL year of grant of options amounting to 5% or more of options granted during the year (2009-10)

iii) Employees who were granted options NIL during any one year, equal to or exceeding 1 % of the issued capital of the Company at the time of the grant.

11. Diluted EPS calculated in accordance Rs. 22.16 per share (including Profit from extraordinary with Accounting Standard 20 issued by item) and Rs. 5.85 per share (excluding Profit from ICAI for the year ended 31 st March extraordinary item)

2010

12. i) Method of calculation of employee N.A. compensation Cost.

ii) Difference between the employee N A compensation cost so compared at (i) above and the employee compensation cost that shall have been recognised if fair value of options had been used.

iii) The impact of the difference on N.A profits and EPS of the Company for the year ended 31st March 2010 had fair value of options had been used for accounting employee Options.

13. Weighted average exercise price and N.A. weighted average fair value of options granted during the year whose exercise price equals market price of stock on the grant date.

(there are no options granted whose exercise price either exceeds or less than the market price of the stock on the date of grant).

14. A description of the method and N.A, significant assumptions used to estimate the fair values of options, including the following weighted average information: i, Risk Free Interest Rate

ii. Expected Life

III. Expected Volatility

iv. Expected Dividends

v, The Price of the underlying share In market at the time of option granted

Particulars of Employees

In terms of the provisions of Section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975 as amended, the names and other particulars of employees are required to be set out in the annexure to the Directors Report. However as per the provisions of section 21 9 (1) (b) (iv) of the said Act, the Annual Report excluding the aforesaid information is being sent to all the members of the Company and others entitled thereto. Any member interested in obtaining such particulars may write to the Company Secretary.

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

Information as required under the provisions of Section 217(1 )(e) of the Companies Act, 1956 read with the Companies

(Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 is annexed to and forms part of this report.

Cost Accounting Records

Your Company is required to maintain cost accounting records in respect of manufacture of power transformers and generation of electricity from Wind Mill (Power) pursuant to the Cost Accounting Records (Engineering Industries) Amendment Rules, 2001. The Company has complied with the above requirement for the year ended 31 st March 2010.

Auditors

The Companys Auditors, M/s. P, Raj 8 Co., Chartered Accountants hold office up to the conclusion of the forthcoming 45th Annual General Meeting and being eligible offer themselves for re-appointment. The Company has received letter from them giving their consent to act as Auditors of the Company and stating that their re-appointment, if made, would be within the prescribed limits under Section 224(1 -B) of the Companies Act, 1956. Your Directors recommend their re- appointment.

Insurance

All the assets of the Company are adequately insured.

Acknowledgement

Your Directors would like to express their grateful appreciation for the assistance, support and co-operation received from the Financial Institutions, Banks, Government Authorities and Shareholders during the year under review. Your Directors would also like to take this opportunity to express their appreciation to the dedicated and committed employees for the contribution in trying to achieve the Companys vision to" To Build a World Class Company through Reliability and be a Great Place to Work".

For and on behalf of the Board of EMCO LIMITED

Place;Thane Rajesh 5 Jain

Date :26th May 2010 Chairman



 
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