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Directors Report of Jindal Poly Films Ltd.

Mar 31, 2014

To the Members,

The Directors have pleasure in presenting the 40th Annual Report of the Company together with Audited Accounts for the year ended 31st March, 2014.

The Financial results of the year under review are as given below:- FINANCIAL RESULTS (Rs./Crores) 2013-14 2012-13

Profit from Operations (EBITDA) 311.54 162.25

Less/(Add) exceptional items 26.76 21.60

Less: Finance Cost 51.17 35.12

Profit Before Depreciation and Tax 233.61 105.53

Less: Depreciation 94.39 88.92

Profit before Tax 139.22 16.61

Less: Income Tax for the year 55.53 (0.41)

Deferred Tax 0.40 8.56

Profit After Tax 83.29 8.46

Add: Balance brought forward 466.28 487.75

Less: Taxes for the earlier years NIL NIL

Balance available for appropriation 549.58 496.21

APPROPRIATIONS

Dividend on Equity Shares 4.20 4.20

Tax on Dividend 0.71 0.71

Transfer to General Reserve 25.00 25.00

Balance carried forward 519.66 466.29

PERFORMANCE HIGHLIGHTS

- Gross sales/turnover increased to Rs.2848.50 crore in financial year 2013-14 i.e. up 18.17% from Rs. 2410.55 crore in year before

- The operating profit before exceptional item of the Company was Rs. 311.54 crore as against Rs. 162.25 crore last year given a growth of 92 %

The Company is taking various measures to retain its market share and as also to improve margins.

DIVIDEND

Your Directors are pleased to recommend a dividend of Re.1/- per equity share (10%) (previous year Re.1/ per equity share) for the Financial Year 2013-14 for approval of the Members.

The total dividend would absorb a sum of Rs.4.20 crore and tax thereon of Rs. 0.71 crore. The dividend will be free of tax in the hands of recipients.

ACQUISITION OF GLOBAL BOPP BUSINESS OF EXXONMOBIL

During the year, the company has successfully completed the acquisition of Entire Global BOPP Films business of ExxonMobil, USA with the change of control from 1st October, 2013. The acquired business is interalia consisting of five manufacturing facilities, two located in USA and three are in Europe. Further details are given in note no. 30.19 to the notes to Accounts.

ExxonMobil was globally well-known reupted manufacturer of BOPP Films for food packaging and for labels. They were the leading suppliers of specialty BOPP Films and top coated BOPP Films to the leading global brand owners in food beverage and confectionary industry. With this acquisition, the company has become world''s largest producer of BOPP Films with a combined capacity of 4,45,000 TPA.

MANAGEMENT DISCUSSION AND ANALYSIS

The MD&A has been included in the annual report as a separate section.

DIRECTORS

- During the year Mr. Samir Banerjee and Mr. Hemant Sharma resigned from Directorship due to their preoccupation. The Directors wish to place on record their appreciation of the valuable service rendered by these Director during their tenure of Director of your Company. Mr. Hemant Sharma was re-appointed on 19th July, 2014 subject to further approval of shareholders in this Annual General Meeting.

- Mr. Sanjay Mittal has been appointed as Whole Time Director of the Company for a period of 5 (Five) years w.e.f. 25th September, 2013. The terms and condition of his appointment and remuneration are subject to approval of the members.

- Ms. Sumita Dhingra has been appointed as Whole Time Director of the Company for a period of 5 (Five) years w.e.f. 19th July, 2014. The terms and condition of her appointment and remuneration are subject to approval of the members.

- Mr. I. Chandrakantha Rao has resigned w.e.f. 6th June, 2014 Mr. Rathi Binod Pal and Mr. Jogesh Bansal has resigned w.e.f. 19th July, 2014. Directors wish to place on record their appreciation of the valuable service rendered by Mr. Rao, Mr. Pal and Mr. Bansal during their tenure of Director of your Company.

As per the provisions of Section 149 of the Companies Act, 2014 which has come into force with effect from 1st April, 2014, an Independent Director shall hold office for a term up to five consecutive years on the Board of a company and is not liable to retire by rotation. In compliance with the provisions of Section 149 read with Schedule IV of the Act, the appointment of Mr. Rashid Jilani, Mr. R.K. Pandey and Mr. Jagdish Prasad Mohta as Independent Directors is being placed before the Members in General Meeting for their approval. In the opinion of the Board, they fulfil the conditions specified in the Act and the Rules made there under for appointment as Independent Directors and are independent of the management. Members are requested to refer to the Notice of the Annual General Meeting and the Explanatory Statement for details of the qualifications and experience of the Directors and the period of their appointment.

Brief resumes of above directors, names of other company (ies) in which they hold directorship, membership of committees of the Board and their shareholdings are given in the Notice to the Shareholders.

PARTICULAR OF EMPLOYEES UNDER SECTION 217 (2A) OF THE COMPANIES ACT, 1956

Particular of employees as required under section 217 (2A) of the Companies Act, 1956 read with Companies (particulars of employees) Rules 1988 is given in Annexure "A" forming part of this report.

CORPORATE GOVERNANCE

The Company has complied with the mandatory provisions of Corporate Governance as prescribed in the Listing Agreement with the Stock Exchanges. A separate report on Corporate Governance is included as a part of the Annual Report along with the Auditor''s Report on its compliance.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to the requirement under section 134 (5) of Companies Act, 2013 (erstwhile Section 217 (2AA) of the Companies Act, 1956) with respect to Director''s Responsibility Statement, it is hereby confirmed;

- That in preparation of the accounts for the financial year ended 31st March, 2014 the applicable accounting standards have been followed along with proper explanations relating to material departures.

- That the Directors have 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 at the end of the financial year and of the profit of the company for the year under review.

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

- That the Directors have prepared the accounts for the financial year ended on 31st March, 2014 on a ''going concern'' basis.

- That the Directors had laid down internal financial control to be followed by the Company and that such internal financial controls are adequate and were operating effectively.

- That the Directors had devised proper system to ensure compliance with the provisions of the all applicable laws and that a systems were adequate and were operating effectively.

SUBSIDIARY COMPANIES AND CONSOLIDATED FINANCIAL STATEMENTS

Consolidated Financial Statements of the Company and its subsidiaries, prepared in accordance with applicable accounting

standards issued by the Institute of Chartered Accountants of India, form part of the Annual Report. In terms of the Circular No.2/ 2011 dated 8th February, 2011 issued by the Ministry of Corporate Affairs, Government of India, the Board of Directors has, at its meeting held on 30th May, 2014 passed a resolution giving consent for not attaching the Balance Sheet, Statement of Profit and Loss and other documents of the subsidiary companies. The required information on subsidiary companies is given in this Annual Report. The said documents/details shall be made available, upon request, to any Member of the Company and will also be made available for inspection by any Member of the Company at the registered office of the Company

STATUTORY AUDITORS

M/s Kanodia Sanyal & Associates, Chartered Accountants retire and being eligible, offer themselves for re-appointment. The auditors have furnished certificate regarding their eligibility for re-appointment as Company''s Auditors, pursuant to Section 139 of the Companies Act, 2013.

COST AUDITORS

The Board has appointed M/s. R.J. Goel & Company, Cost Accountants, New Delhi as Cost Auditors of the Company pursuant to section 233B of the Companies Act, 1956 for the financial year 2013 – 14, The Cost audit report for financial year 2012-13 approved by Board of Directors of the Company on 20th December, 2013 was filed on 24th December, 2013. Pursuant to provision of Section 148 of Companies Act, 2013 M/s. R.J. Goel & Company, Cost Accountants furnish a certificates of consent and independence for their reappointment. The Board of Directors appointed M/s. R.J. Goel & Company, Cost Accountants for audit of cost record of the company for the year ended 31st March, 2015.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION, FOREIGN EARNING & OUTGO

Information in accordance with the provisions of section 134 (5) of Companies Act, 2013 (erstwhile Section 217 (2AA) of the Companies Act, 1956) regarding conservation of Energy, technology absorption, foreign exchange earnings and outgo is given in the ''Annexure "B" forming part of this report.

ACKNOWLEDGEMENT

Your Directors would like to express their gratitude to financial institutions, Banks and various State and Central Government authorities for the co-operation extended to the Company. Directors also take this opportunity to thanks the shareholders, customers, suppliers, lenders and distributors for the confidence reposed by them in the Company. The employees of the Company contributed significantly in achieving the results. Your Directors take this opportunity of thanking them and hope that they will maintain their commitment to excellence in the years to come.

For and on behalf of the Board

Place : New Delhi (Sanjay Mittal) (Sumita Dhingra) Dated : 19th July, 2014 Whole Time Director Whole Time Director DIN:– 01327274 DIN:– 06929317


Mar 31, 2013

To the Members''

The Directors have pleasure in presenting the 39th Annual Report of the Company together with Audited Accounts for the year ended 31st March'' 2013.

The Financial results of the year under review are as given below:-

FINANCIAL RESULTS

(Rs./ Crores)

2012-13 2011-12

Profit from Operations (EBITDA) 186.89 364.60

Less / (Add) exceptional items 21.60 74.33

Less: Interest 35.12 26.14

Profit Before Depreciation and Tax 130.17 264.13

Less: Depreciation 88.92 88.09

Profit before Tax 41.25 176.04

Less: Income Tax for the year 0.11 54.91

Deferred Tax 8.56 (15.94)

Profit After Tax 32.58 137.08

Add: Balance brought forward 487.75 412.89

Balance available for appropriation 520.33 549.97

APPROPRIATIONS

Dividend on Equity Shares 4.20 10.51

Tax on Dividend 0.71 1.71

Transfer to General Reserve 25.00 50.00

Balance carried forward 490.42 487.75

PERFORMANCE HIGHLIGHTS

During the year under review your Company has achieved a gross turnover of Rs. 2410.55 crore as compared to Rs. 2492.92 crore during the previous year and operating profit before exceptional item Rs. 186.89 crore as against Rs. 364.60 crore during the previous year . During the year'' company experienced pressure on its margin due to increased competition caused by lower demand. The Company is taking various measures to retain its market share and as also to improve margins.

DIVIDEND

Your Directors are pleased to recommend a dividend of Re.1/- per equity share (10%) (previous year Rs. 2.50 per equity share) for the Financial Year 2013 for approval of the Members.

The total dividend would absorb a sum of Rs.4.20 crore and tax thereon of Rs. 0.71 crore. The dividend will be free of tax in the hands of recipients.

ACQUISITION OF GLOBAL BOPP BUSINESS OF EXXONMOBIL

The Company has signed a Sales Purchase Agreement on 03rd May'' 2013'' for acquiring the Global BOPP Film business of ExxonMobil Chemical Company (USA) at a consideration of approximately USD 235 Million'' which is subject to customary price adjustments. The transaction is expected to close by the end of August 2013.

The acquisition transaction covers five BOPP production locations in the U.S. and Europe. The manufacturing sites are in Georgia and Oklahoma in the U.S. and in Italy'' the Netherlands'' and Belgium in Europe. The transaction also includes a technology center and sales office in Rochester'' New York'' and an office in Luxembourg. Approximately 14500 people work in those operations. This acquisition will make JPFL one of the leading manufacturers of flexible packaging films globally with a combined capacity of approximately 445''000 tons/annum for BOPP films.

MANAGEMENT DISCUSSION AND ANALYSIS

The MD&A has been included in the annual report as a separate section.

DIRECTORS

- Mr. Rathi Binod Pal'' retire by rotation at the ensuing Annual General Meeting'' and being eligible'' offer himself for re- appointment.

- Mr. Samir Banerjee has been reappointed as Whole Time Director of the Company for a further period of 3 (three) years w.e.f. 25th August'' 2013. The terms and condition of his appointment and remuneration are subject to approval of the members.

Brief resumes of above directors'' names of other company (ies) in which they hold directorship''membership of committees of the Board and their shareholdings are given in the Notice to the Shareholders.

PARTICULARS OF EMPLOYEES UNDER SECTION 217(2A) OF THE COMPANIES ACT'' 1956.

Particulars of employees as required under section 217(2A) of the Companies Act'' 1956'' read with the Companies (particular of Employees) Rules 1988 is given in Annexure "A" forming part of this Report.

CORPORATE GOVERNANCE

The Company has complied with the mandatory provisions of Corporate Governance as prescribed in the Listing Agreement with the Stock Exchanges. A separate report on Corporate Governance is included as a part of the Annual Report along with the Auditor''s Report on its compliance.

DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to the requirement under section 217 (2AA) of the Companies Act'' 1956'' with respect to Director''s Responsibility Statement'' it is hereby confirmed;

- That in preparation of the accounts for the financial year ended 31st March'' 2013 the applicable accounting standards have been followed along with proper explanations relating to material departures.

- That the Directors have 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 at the end of the financial year and of the profit of the company for the year under review.

- That the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act'' 1956 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities.

- That the Directors have prepared the accounts for the financial year ended on 31st March'' 2013 on a ''going concern'' basis.

SUBSIDIARY COMPANIES AND CONSOLIDATED FINANCIAL STATEMENTS

Consolidated Financial Statements of the Company and its subsidiaries'' prepared in accordance with applicable accounting standards issued by the Institute of Chartered Accountants of India'' form part of the Annual Report. In terms of the Circular No.2/ 2011 dated 8th February'' 2011 issued by the Ministry of Corporate Affairs'' Government of India'' the Board of Directors has'' at its meeting held on 3rd May'' 2013 passed a resolution giving consent for not attaching the Balance Sheet'' Statement of Profit and Loss and other documents of the subsidiary companies. The required information on subsidiary companies is given in this Annual Report. The said documents/details shall be made available'' upon request'' to any Member of the Company and will also be made available for inspection by any Member of the Company at the registered office of the Company

STATUTORY AUDITORS

M/s Kanodia Sanyal & Associates'' Chartered Accountants retire and being eligible'' offer themselves for re-appointment. The auditors have furnished certificate regarding their eligibility for re-appointment as Company''s Auditors'' pursuant to Section 224 (1-B) of the Companies Act'' 1956.

COST AUDITORS

The Board has appointed M/s. R.J. Goel & Company'' Cost Accountants'' New Delhi as Cost Auditors of the Company pursuant to section 233B of the Companies Act'' 1956 for the financial year 2012 – 13'' The Cost audit report for financial year 2011-12 approved by Board of Directors of the Company on 14th November'' 2012 was filed on 31st December'' 2012.

FIXED DEPOSITS

The Company has not accepted any fixed deposits and the provisions of section 58-A of the Companies Act'' 1956 are not applicable to the Company.

DEMERGER OF INVESTMENT DIVISION

The members may be aware that the Company has been implementing a proposal to demerge its Investment Division into Jindal Poly Investment and Finance Company Limited ("Resulting Company"). The demerger shall facilitate the running of the manufacturing business of the Company'' which is the core business of the Company'' with more focused approach. Upon the coming into effect of the Scheme and in consideration of the demerger of the investment division '' the Resulting Company shall allot its 1(one) Equity Share of Rs.10/- each'' fully paid-up'' in lieu of every 4(four) Equity shares held in the Company on the Record Date to be fixed by the Board.

Hon''ble High Court of Judicature at Allahabad'' at its hearing held on May 16'' 2013'' has sanctioned the scheme of demerger of Investment Division of the Company into Jindal Poly Investment and Finance Company Limited. The formal order of the High court is awaited which will be filed with the Registrar of Companies'' U.P. and upon filing'' the Demerger scheme shall become effective.

ENERGY CONSERVATION'' TECHNOLOGY ABSORPTION'' FOREIGN EARNING & OUTGO

Information in accordance with the provisions of section 217 (1) (e) of the Companies Act'' 1956 read with Companies (Disclosure of Particulars in the Report of Board of Directors) Rules'' 1988 regarding conservation of Energy'' technology absorption'' foreign exchange earnings and outgo is given in the ''Annexure "B" forming part of this report.

ACKNOWLEDGEMENT

Your Directors would like to express their gratitude to financial institutions'' Banks and various State and Central Government authorities for the co-operation extended to the Company. Directors also take this opportunity to thanks the shareholders'' customers'' suppliers'' lenders and distributors for the confidence reposed by them in the Company. The employees of the Company contributed significantly in achieving the results. Your Directors take this opportunity of thanking them and hope that they will maintain their commitment to excellence in the years to come.

For and on behalf of the Board

Place : New Delhi (Rathi Binod Pal) (Samir Banerjee)

Dated : 29th May'' 2013 Whole Time Director Whole Time Director

DIN:– 00092049 DIN:– 00011754


Mar 31, 2012

The Directors have pleasure in presenting the 38th Annual Report of the Company together with Audited Accounts for the year ended 31st March, 2012.

The Financial results of the year under review are as given below:-

FINANCIAL RESULTS

(Rs. / Crores)

2011-12 2010-11

Profit from Operations (EBITDA) 364.60 963.54

Less / (Add) exceptional items 74.33 (6.12)

Less: Interest 26.14 20.44

Profit Before Depreciation and Tax 264.13 949.23

Less: Depreciation 88.09 84.23

Profit before Tax 176.04 865.00

Less: Income Tax for the year 54.91 260.44

Deferred Tax (15.94) 11.90

Profit After Tax 137.08 592.66

Add: Balance brought forward 412.89 333.60

Less: Taxes for the earlier years NIL NIL

Balance available for appropriation 549.97 926.26

APPROPRIATIONS

Dividend on Equity Shares 10.51 11.51

Tax on Dividend 1.71 1.87

Transfer to General Reserve 50.00 500.00

Balance carried forward 487.75 412.88

PERFORMANCE HIGHLIGHTS

Your Company achieved a sales turnover of Rs.2492.92 crore during the year as compared to Rs.2906.66 crore during the previous year and recorded operating profit before exceptional item Rs.364.60 crore as against Rs.963.54 crore during the previous year .

DIVIDEND

Your Directors have pleasure to recommend Dividend of 25% (Rs. 2.50 per share) on 4,20,47,713 Equity Shares Capital of Rs. 10/- each.

The total dividend would absorb a sum of Rs. 10.51 crore and tax thereon of Rs. 1.71 crore. The dividend will be free of tax in the hands of recipients.

NEW PROJECTS

i) One BOPP line with a capacity of 30,000 tpa (line 6) commenced operation during the year 2011-12

ii) The Company propose to setup a new BOPP line (line 7) with a capacity of 30,000 MTPA and a BOPET (line G) with a capacity of 30,000 MTPA at a total project cost of Rs.330 crore

MANAGEMENT DISCUSSION AND ANALYSIS

The MD&A has been included in the annual report as a separate note.

DIRECTORS

- Mr. Rashid Jilani, retire by rotation at the ensuing Annual General Meeting, and being eligible, offer themselves for re- appointment.

- Mr. Hemant Sharma was appointed as Additional Director of the Company w.e.f. 1st April, 2012. The office of Mr. Hemant Sharma will expire at the forthcoming Annual General Meeting i.e 29th September, 2012. The Company has received a notice under section 257 of the Companies Act, 1956 from a member of the Company proposing the appointment of Mr. Hemant Sharma as Director of the Company whose period of office will be liable to retire by rotation.

Brief resumes of above directors, names of other company (ies) in which they hold directorship, membership of committees of the Board and their shareholdings are given in the Notice to the Shareholders.

- Mr. V.K.Gupta, Director resigned w.e.f. 1st April, 2012. The Board places on record its sincere appreciation of the valuable services rendered by Mr. V.K. Gupta during his tenure as Director of the Company.

PARTICULARS OF EMPLOYEES UNDER SECTION 217(2A) OF THE COMPANIES ACT, 1956.

There is no employee who has received the remuneration of Rs. 5,00,000 per month or Rs. 60,00,000 per annum during the year under review.

CORPORATE GOVERNANCE

The Company has complied with the mandatory provisions of Corporate Governance as prescribed in the Listing Agreement with the Stock Exchanges. A separate report on Corporate Governance is included as a part of the Annual Report along with the Auditor's Report on its compliance.

DIRECTORS' RESPONSIBILITY STATEMENT

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

- That in preparation of the accounts for the financial year ended 31st March, 2012 the applicable accounting standards have been followed along with proper explanations relating to material departures.

- That the Directors have 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 at the end of the financial year and of the profit of the company for the year under review.

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

- That the Directors have prepared the accounts for the financial year ended on 31st March, 2012 on a 'going concern' basis.

SUBSIDIARY COMPANIES AND CONSOLIDATED FINANCIAL STATEMENTS

In accordance with the Accounting Standard AS – 21 on Consolidated Financial Statements read with Accounting Standard AS – 23 on accounting for investments in Associates, Your Directors have pleasure in attaching the Consolidated Financial Statements which form part of this Annual Report and Accounts.

The statement pursuant to Section 212 of the Companies Act, 1956 read with general circular No. 51/12/2007-cl-III dated 8th February, 2011 of the Ministry of Corporate Affairs, containing the details of the Company's subsidiaries is attached.

In term of the said circular dated 8th February, 2011, copies of the Balance Sheet, Profit & Loss Account, report of Board and the Auditors of all the subsidiary Companies have not been attached to Balance Sheet of the Company. However, the annual account of the subsidiary Companies and the related detailed information shall be made available to the shareholders of the Company and of the subsidiary Companies seeking such information at any point of time. The annual accounts of the subsidiary Companies are also available for inspection by any shareholders at the head office of the Company and that of the Subsidiary Companies concerned.

STATUTORY AUDITORS

M/s Kanodia Sanyal & Associates, Chartered Accountants retire and being eligible, offer themselves for re-appointment. The auditors have furnished certificate regarding their eligibility for re-appointment as Company's Auditors, pursuant to Section 224 (1-B) of the Companies Act, 1956.

COST AUDITORS

The Board has appointed M/s. R.J. Goel & Company, Cost Accountants, New Delhi as Cost Auditors of the Company pursuant to section 233B of the Companies Act, 1956 for the financial year 2012 – 13, The Cost audit report for financial year 2010-11 approved by Board of Directors of the Company on 14th November, 2011 was filed on 28th November, 2011.

FIXED DEPOSITS

The Company has not accepted any fixed deposits and the provisions of section 58-A of the Companies Act, 1956 are not applicable to the Company.

BUYBACK OF EQUITY SHARES

The Board of Directors of the Company at its meeting held on 31st October, 2011 announced a Buyback of its fully paid up equity shares for an aggregate amount not exceeding Rs. 140.00 crore at a maximum price of Rs. 350/- per share from the open market through stock exchanges, The Buyback commenced on 25th November, 2011 and closed on 16th May,2012. An aggregate of 39,94,563 Equity shares at an average price of Rs.178.63 per equity share were bought back absorbing a total amount of Rs.71.35 Crore. Accordingly the paid up equity shares capital of the Company stand reduced to Rs.42,04,77,130.00 as against Rs.46,04,22,760.00 as on 31st March, 2011.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION, FOREIGN EARNING & OUTGO

Information in accordance with the provisions of section 217 (1) (e) of the Companies Act, 1956 read with Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 regarding conservation of Energy, technology absorption, foreign exchange earnings and outgo is given in the 'Annexure I' forming part of this report.

ACKNOWLEDGEMENT

Your Directors would like to express their gratitude to financial institutions, Banks and various State and Central Government authorities for the co-operation extended to the Company. Directors also take this opportunity to thanks the shareholders, customers, suppliers, lenders and distributors for the confidence reposed by them in the Company. The employees of the Company contributed significantly in achieving the results. Your Directors take this opportunity of thanking them and hope that they will maintain their commitment to excellence in the years to come.

For and on behalf of the Board

Place : New Delhi (Rathi Binod Pal) (Samir Banerjee)

Dated : 1st September, 2012 Whole Time Director Whole Time Director (Marketing)


Mar 31, 2011

To the Members,

The Directors have pleasure in presenting the 37th Annual Report of the Company together with Audited Accounts for the year ended 31st March, 2011.

The Financial results of the year under review are as given below:-

FINANCIAL RESULTS

(Rs. / Crores)

2010-11 2009-10

Profit from Operations (EBITDA) 973.11 363.54

Less / (Add) exceptional items (6.12) (46.49)

Less: Interest 27.13 28.09

Profit Before Depreciation and Tax 952.10 381.94

Less: Depreciation 87.11 80.44

Profit before Tax 865.00 301.50

Less: Income Tax for the year 260.44 64.02

Deferred Tax 11.90 29.10

Profit After Tax 592.66 208.38

Add: Balance brought forward 333.60 202.07

Less: Taxes for the earlier years NIL NIL

Balance available for appropriation 926.26 410.45

APPROPRIATIONS

Dividend on Equity Shares 11.51 23.02

Tax on Dividend 1.87 3.82

Transfer to General Reserve 500.00 50.00

Balance carried forward 412.88 333.61

PERFORMANCE HIGHLIGHTS

- Gross Sales/Turnover increased to Rs. 2906.78 crores in the financial year 2010-11, up 70.76% from Rs. 1702.22 crores the year before.

- Exports turnover increased to Rs. 744.33 crores for the year 2010-2011 up 133.50% from Rs. 318.77 crores in the last year,

- The operating profit before exceptional item of the company was Rs. 973.11 crores as against Rs. 363.54 crores last year, giving a growth of 167.68%.

DIVIDEND

Your Directors have pleasure to recommend Dividend of 25% (Rs. 2.50 per share) on 4,60,42,276 Equity shares Capital of Rs. 10/- each.

The total dividend would absorb a sum of Rs. 11.51 crore and tax thereon of Rs. 1.87 crore the dividend will be free of tax in the hands of recipients.

MANAGEMENT DISCUSSION AND ANALYSIS

The MD&A has been included in the annual report as a separate note.

DIRECTORS

- Mr. Jogesh Bansal, Mr. R.K. Pandey and Mr. V. K. Gupta, retire by rotation at the ensuing Annual General Meeting, and being eligible, offer themselves for re-appointment.

Brief resumes of above directors, names of other company(ies) in which they hold directorship, membership of committees of the Board and their shareholdings are given in the Notice to the Shareholders.

- Mr. A.C. Wadhawan, Director resigned w.e.f. 4th September, 2010 . The Board places on record its sincere appreciation of the valuable services rendered by Mr. A.C. Wadhawan during his tenure as Director of the Company.

PARTICULARS OF EMPLOYEES UNDER SECTION 217(2A) OF THE COMPANIES ACT, 1956.

There is no employee who has received the remuneration of Rs. 5,00,000 per month or Rs. 60,00,000 per annum during the year under review.

CORPORATE GOVERNANCE

The Company has complied with the mandatory provisions of Corporate Governance as prescribed in the Listing Agreement with the Stock Exchanges. A separate report on Corporate Governance is included as a part of the Annual Report along with the Auditor's Report on its compliance.

DIRECTORS' RESPONSIBILITY STATEMENT

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

- That in preparation of the accounts for the financial year ended 31st March, 2011 the applicable accounting standards have been followed along with proper explanations relating to material departures;

- That the Directors have 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 at the end of the financial year and of the profit of the company for the year under review;

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

- That the Directors have prepared the accounts for the financial year ended on 31st March, 2011 on a 'going concern' basis.

SUBSIDIARY COMPANIES AND CONSOLIDATED FINANCIAL STATEMENTS

In accordance with the Accounting Standard AS – 21 on Consolidated Financial Statements read with Accounting Standard AS – 23 on accounting for investments in Associates, Your Directors have pleasure in attaching the Consolidated Financial Statements which form part of this Annual Report and Accounts.

The statement pursuant to Section 212 of the Companies Act, 1956 read with general circular No. 51/12/2007-cl-III dated 8th February, 2011 of the Ministry of Corporate Affairs, containing the details of the Company's subsidiaries is attached.

In term of the said circular dated 8th February, 2011, copies of the Balance Sheet, profit & Loss Account, report of Board and the Auditors of all the subsidiary Companies have not been attached to Balance Sheet of the Company. However, the annual account of the subsidiary Companies and the related detailed information shall be made available to the shareholders of the Company and of the subsidiary Companies seeking such information at any point of time. The annual accounts of the subsidiary Companies are also available for inspection by any shareholders at the head office of the Company and that of the Subsidiary Companies concerned.

STATUTORY AUDITORS

M/s Kanodia Sanyal & Associates, Chartered Accountants retire and being eligible, offer themselves for re-appointment. The auditors have furnished certificate regarding their eligibility for re-appointment as Company's Auditors, pursuant to Section 224 (1-B) of the Companies Act, 1956.

COST AUDITORS

The Board has appointed M/s. R.J Goel & Company , Cost Accountants, New Delhi as Cost Auditors of the Company pursuant to section 233B of the Companies Act, 1956 for the financial year 2011-12.

FIXED DEPOSITS

The Company has not accepted any fixed deposits and the provisions of section 58-A of the Companies Act, 1956 are not applicable to the Company.

BONUS SHARES

During the year as per recommendation of the Board to issue bonus equity share in the ratio of 1 (one) equity share for every 1 (one) equity share held and approved by the shareholders, the allotment of bonus shares to equity share holders was completed on 26th October, 2010.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION, FOREIGN EARNING & OUTGO

Information in accordance with the provisions of section 217 (1) (e) of the Companies Act, 1956 read with Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 regarding conservation of Energy, technology absorption, foreign exchange earnings and outgo is given in the 'Annexure I' forming part of this report.

GROUP FOR INTERSE TRANSFER OF SHARES

Details of persons constituting "group" as required under clause 3(1)(e) of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeover) Regulations, 1997 is given in 'Annexure II' and forms part of this Annual Report.

ACKNOWLEDGEMENT

The Directors express their gratitude to financial institutions, Banks and various Government authorities for the co-operation extended to the Company. The Directors also take this opportunity to thanks the shareholders, customers, suppliers lenders and distributors for the confidence reposed by them in the Company. The employees of the Company contributed significantly in achieving the results. The Directors take this opportunity of thanking them and hope that they will maintain their commitment to excellence in the years to come.

For and on behalf of the Board

(Rathi Binod Pal) (Samir Banerjee)

Whole Time Director Whole Time Director (Marketing)

Place: New Delhi

Dated: 8th August, 2011


Mar 31, 2010

The Directors have pleasure in presenting the 36th Annual Report of the Company together with Audited Accounts for the year ended 31st March, 2010.

The Financial results of the year under review are as given below:-

FINANCIAL RESULTS

(Rs. / Crores)

2009-10 2008-09

Profit from Operations (EBITDA) 363.54 339.27

Less / (Add) exceptional items (46.49) 62.38

Less: Interest 28.09 19.65

Profit Before Depreciation and Tax 381.94 257.24

Less: Depreciation 80.44 68.82

Profit before Tax 301.50 188.42

Less: Income Tax for the year 64.02 54.30

Deferred Tax 29.10 7.62

Profit After Tax 208.38 126.49

Add: Balance brought forward 202.07 131.40

Less: Taxes for the earlier years NIL NIL

Balance available for appropriation 410.45 257.89

APPROPRIATIONS

Dividend on Equity Shares 23.02 4.97

Tax on Dividend 3.82 0.85

Transfer to General Reserve 50.00 50.00

Balance carried forward 333.61 202.07

PERFORMANCE HIGHLIGHTS

- Gross Sales/Turnover increased to Rs. 1702.22 crores in the financial year 2009-10, up 8.94% from Rs. 1562.51 crores the year before.

- Exports for the year 2009-2010 stood marginally lower at Rs. 318.77 crores as compared to Rs. 352.70 crores in the last year, however, due to increase in domestic turnover overall turnover is higher

- The operating profit before exceptional item of the company was Rs. 363.54 crores as against Rs. 339.27 crores last year giving a growth of 7.15%.

DIVIDEND

Your Directors have pleasure to recommend Dividend of 100% on 2, 30, 21,138 Equity shares Capital of Rs. 10/- each.

The total dividend would absorb a sum of Rs. 23.02 crore and tax thereon of Rs. 3.82 crore the dividend will be free of tax in the hands of recipients.

WITHDRAWAL OF BUY-BACK OF EQUITY SHARES

Your Directors are of the view that buy-back of equity shares which was approved by the shareholders by postal ballot on 8th March, 2010 at the maximum price of Rs. 450/- per share seems unachievable and propose to withdraw the said buy-back proposal. A detailed statement of reasons have been given in the explanatory statement no. 8 of the notice sent with this Annual report.

ISSUE OF BONUS SHARES

Considering the comfortable free reserves position, present net-worth and future earning potential of the Company, It is proposed to capitalize a sum of Rs. 23,02,11,380 to be applied for the issue of 2,30,21,138 fully paid-up Bonus Equity Shares in the ratio of one Equity Share for every one Equity Share of the Company.

FUNDS RAISING OPTION BY THE COMPANY

The Company plans to make large investments towards product development, capital expenditure for capacity enhancement, plant renewal, modernization and other meaningful growth opportunities like acquisitions in India and/or abroad. It is , therefore, proposed to issue Securities for an amount upto Rs.2,000 crores, in one or more tranches, in such form, in such manner, at such price or prices and at such time as may be considered appropriate by the Board, to the various categories of Investors in the domestic and/or international market.

MANAGEMENT DISCUSSION AND ANALYSIS

The MD&A has been included in the annual report as a separate note.

DIRECTORS

- Mr. Rashid Jilani and Mr. Samir Banerjee retire by rotation at the ensuing Annual General Meeting, and being eligible, offer themselves for re-appointment.

- Mr. Rathi Binod Pal was appointed as an additional Director of the Company on 17/12/2009, The office of Mr. Rathi Binod Pal will expire at the forthcoming Annual General Meeting i.e. on 30/09/2010. The Company has received a notice under section 257 of the Companies Act, 1956 from a member of the Company proposing the appointment of Mr. Rathi Binod Pal as Director of the Company whose period of office will be liable to retire by rotation.

Brief resumes of above directors, names of other company(ies) in which they hold directorship, membership of committees of the Board and their shareholdings are given in the Notice to the Shareholders.

- Mr. Sumant Singhal, Whole Time Director and CEO resigned w.e.f. 21st January, 2010 . The Board places on record its sincere appreciation of the valuable services rendered by Mr. Sumant Singhal during his tenure as Director and CEO of the Company.

- The office of Dr. Sudhir Kapur, Director (DEG Nominee) was vacated w.e.f. 19th July, 2010 . The Board places on record its sincere appreciation of the valuable services rendered by Dr. Sudhir Kapur during his tenure as Director of the Company.

PARTICULARS OF EMPLOYEES UNDER SECTION 217(2A) OF THE COMPANIES ACT, 1956.

There is no employee who has received the remuneration of Rs. 2,00,000 per month or Rs. 24,00,000 per annum during the year under review.

CORPORATE GOVERNANCE

The Company has complied with the mandatory provisions of Corporate Governance as prescribed in the Listing Agreement with the Stock Exchanges. A separate report on Corporate Governance is included as a part of the Annual Report along with the Auditors Report on its compliance.

DIRECTORS RESPONSIBILITY STATEMENT

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

- That in preparation of the accounts for the financial year ended 31st March, 2010 the applicable accounting standards have been followed along with proper explanations relating to material departures;

- That the Directors have 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 at the end of the financial year and of the profit of the company for the year under review;

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

- That the Directors have prepared the accounts for the financial year ended on 31st March, 2010 on a ‘going concern basis.

SUBSIDIARY COMPANIES AND CONSOLIDATED FINANCIAL STATEMENTS

In accordance with the Accounting Standard AS – 21 on Consolidated Financial Statements read with Accounting Standard AS – 23 on accounting for investments in Associates, Your Directors have pleasure in attaching the Consolidated Financial Statements which form part of this Annual Report and Accounts.

In terms of approval granted by Central Government under section 212 (8) of the Companies Act, 1956 vide letter no. 47/630/2010-CL-III dated 16/07/2010, the Balance Sheet, Profit & Loss Account, report of Board of Directors and Auditors of the subsidiary Companies have not been attached to the accounts of the Company. The Annual reports shall be made available upon request to any member of the Company interested in obtaining the same.

AUDITORS

M/s Kanodia Sanyal & Associates, Chartered Accountants retire and being eligible, offer themselves for re-appointment. The auditors have furnished certificate regarding their eligibility for re-appointment as Companys Auditors, pursuant to Section 224 (1-B) of the Companies Act, 1956.

FIXED DEPOSITS

The Company has not accepted any fixed deposits and the provisions of section 58-A of the Companies Act, 1956 are not applicable to the Company.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION, FOREIGN EARNING & OUTGO

Information in accordance with the provisions of section 217 (1) (e) of the Companies Act, 1956 read with Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 regarding conservation of Energy, technology absorption, foreign exchange earnings and outgo is given in the ‘Annexure I forming part of this report.

GROUP FOR INTERSE TRANSFER OF SHARES

Details of persons constituting "group" as required under clause 3(1)(e) of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeover) Regulations, 1997 is given in Annexure II and forms part of this Annual Report.

ACKNOWLEDGEMENT

Your Directors acknowledge the co-operation and assistance received from the financial institutions, Banks and various Government authorities during the year.

The Directors also wish to place on record their appreciation of the contribution made by the Employees at all levels.

For and on behalf of the Board

Place: New Delhi (Rathi Binod Pal) (Samir Banerjee)

Dated: 3rd September, 2010 Whole Time Director Whole Time Director (Marketing)