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Directors Report of JK Cement Ltd.

Mar 31, 2014

Dear Members,

The Directors have pleasure in submitting their Twentieth Annual Report and audited statements of accounts for the year ended 31st March, 2014.

1. Financial results

Rs./ Lacs

2013-14 2012-13

Gross Turnover 320171 334258

Profit before depreciation and tax 27024 46888

Less: Depreciation 13397 12826

Profit before Tax 13627 34063

Tax Expense (including deferred tax and tax adjustment of earlier years) 3924 10708

Profit After Tax 9703 23355

Add: balance brought forward from previous year 38620 27716

Less: Appropriation

Transfer to General Reserve 2000 6000

Transfer to Debenture Redemption Reserve 1632 1133

Dividend to Equity Shares (including tax thereon) 2454 5318

balance to be carried forward 42237 38620

2. Overall performance

Your Company''s performance during the year under report has remained marginal in terms of production, sales quantity as well as turnover.

The Company''s gross turnover remained Rs. 3202 Crore during the year compared to Rs. 3343 Crore in previous year. Profit before Depreciation & Tax achieved at Rs. 270 Crore compared to Rs. 469 Crore.

3. Consolidated Financial Statements

The statement as required under Section 212 of the Companies Act, 1956, in respect of the subsidiaries of the Company viz. J.K. Cement (Fujairah) FZC and J.K. Cement Works (Fujairah) FZC is annexed and forms an integral part of this Report. Consolidated Financial Statements form part of the Annual Report and Accounts. In terms of General Circular nos.2/2011 and 22/2011 and board''s decision, attaching of the Audited balance Sheets as at 31st March, 2014 as required under Section 212 (8) of the Companies Act, 1956 in respect of the subsidiaries of the Company have been dispensed with. However, the requisite information for each subsidiary has been disclosed. The annual accounts of the subsidiary companies and the related detailed information will be made available to the investors of the Company seeking such information.

4. Dividend

your Directors are pleased to recommend dividend of Rs. 3.00 per share for the financial year ended 31st March, 2014 compared to Rs. 6.50 per share paid for the financial year ended 31st March, 2013.

5. Operations

Grey Cement

During the year under report, in respect of Grey Cement plants in Rajasthan and Karnataka production decreased by 6.08% at 5.34 Millon Tonne (compared to 5.68 Million Tonne last year) and sales by 4.95% at 5.36 Millon Tonne (compared to 5.64 Million Tonne last year).

White Cement

Production of White Cement increased by 8.17% at 4.75 Lacs Tonne during the year compared to 4.4 Lacs Tonne while production of value added product Wall Putty registered increase of 27.9%. Sale was also in tandem with production.

6. Projects of the company

Expansion initiatives

The work at the brown field Grey Cement expansion of 3 Million Tonne per annum with split grinding unit in Haryana is in advance stage of completion and will be commissioned as per the schedule. At J.K. Cement Works, Mangrol Clinker/Cement production and regular dispatch is expected by September, 2014. At J.K. Cement Works, Jharli, commercial dispatch is expected in June, 2014. During the year under report your Company decided to implement a White Cement based Wall Putty project of 2 Lac Tonne per annum capacity in Madhya Pradesh.

7. Projects of subsidiary/joint venture company in Hand

(a) Projects Under Subsidiary Company:

Cement plant at fujairah, UAE your company has implemented a Greenfield dual process cement plant having capability of producing either 0.6 Million Tonne of White cement or 1 Million Tonne of Grey Cement or a combination of both depending upon the market condition in GCC region, under the subsidiary, J.K Cement Works (Fujairah), FZC UAE, which is a Joint Venture Company with the Government of Fujairah Establishment. White Cement production has commenced in fourth Quarter of 2013-14. The quality of White Cement has been well accepted in the market.

(b) Project Under Joint Venture:

Captive coal block in maharashtra As reported earlier the Company was allocated a coal block jointly with two other allottees in Bander, Maharashtra. During the year, the Ministry of Coal, Govt. of India, issued an order for de-allocation of the Coal block. Bander Coal Company Pvt. Ltd., the joint venture Company incorporated by the allottees for mining of coal has fled an application for return of bank guarantee.

8. Finance

During the year under report your Company has raised Rs. 200 Crore through Secured non Convertible Debentures, availed net additional term loan ofRs. 998 Crore, from various banks and repaid Rs. 147.25 Crore.

9. Credit Rating

In spite of odd cement industry scenario, CARE has reaffirmed your Company''s rating as "CARE AA-" for long term bank facilities and "CARE A1 " for short term bank facilities.

10. Matter Of Emphasis

The Competition Commission of India (''CCI''), on the complaint fled by builders Association of India on the ground of alleged contravention of Competition Law, in Case no.29/2010 passed an Order dated 20.6.2012 imposing total penalty of Rs. 6307 Crore against Cement Manufacturers'' Association and 11 Cement Companies including Rs. 128.54 Crore on your Company. your Company has been advised by legal counsel that it has a good case and accordingly stay petition and appeal were preferred before the Competition Appellate Tribunal (''COMPAT''). COMPAT granted stay of penalty demand against deposit of 10% i.e. Rs.12.85 Crore. COMPAT is hearing the appeal(s). no provision in the books of account has been considered necessary by management.

11. Subsidiary Companies

A statement pursuant to Section 212 of the Companies Act, 1956 is annexed.

12. Corporate Governance

A report on Corporate Governance is enclosed as part of Annual Report Along with the Auditors'' Certificate on its compliance.

13. Personnel

13.1 Industrial relations

The industrial relations during the period under review generally remained cordial at all Cement plants.

13.2 particulars of employees List of employees getting salary in excess of the limits as specified under the provisions of sub-section (2A) of Section 217 of the Companies Act, 1956 (corresponding Section 134 of the Companies Act, 2013) read with Companies (Appointment & Remuneration) Rules 2014 throughout or part of the financial year under review is annexed. However, the Annual Report excluding the aforesaid information is being sent to all the members of the company pursuant to proviso to Section 136 of the Companies Act, 2013. Any member interested in obtaining such particulars may inspect and/or send the request to the Company at its Registered & Corporate Office.

14. Public Deposits

Your Company has not invited any deposits from public / shareholders in accordance with the Section 58A of the Companies Act, 1956 (corresponding Section 73 and 74 of the Companies Act, 2013).

15. Conservation Of Energy, Technology Absorption, Foreign Exchange Earnings And Outgo.

Particulars with regard to Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and out go in accordance with the provisions of Section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosures of particulars in the Report of board of Directors) Rules, 1988 (corresponding Section 134 of the Companies Act 2013) in respect of Cement plants are annexed and form part of the Report.

16. Auditors'' Report

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

17. Directors

Shri Kailash nath Khandelwal (DIN 00037250) will retire by rotation at the ensuing Annual General Meeting and being eligible, offers himself for reappointment. During the year under report Shri Jagendra Swarup (DIN 00164708) was appointed as an Additional Director now being appointed/confirmed as an Independent Director for a term upto five consecutive years and to hold office till relevant Annual General Meeting as per provisions of Companies Act, 2013. Independent Directors Shri Achintya Karati (DIN 00024412), Shri Ashok Sharma (DIN 00057771), Shri Jayant narayan Godbole (DIN 00056830), Dr. K.B. Agarwal (DIN 00339934), Shri R.K. Lohia (DIN 00203659) and Shri Suparas Bhandari (DIN 00159637) have completed their first term and as per provisions of the Companies Act, 2013, they are to be appointed as Independent Directors for a term upto five consecutive years and to hold office till relevant Annual General Meeting. During the year Shri J.P. Bajpai (DIN 00005996), an Independent Director has relinquished from Directorship of the Company due to ill health. The board records its appreciation for the contribution rendered by Shri J. P. bajpai during his tenure.

18. Directors'' responsibility statement

The Directors conform that:

(i) In the preparation of the annual accounts, the applicable accounting standards have been followed and that no material departures have been made from the same.

(ii) They have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that year;

(iii) They have taken proper and sufficient care for 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) They have prepared the annual accounts on a going concern basis.

19. Auditors

M/s. P.L. Tandon & Co., Chartered Accountants, Kanpur, Auditors of the Company, will retire from their office at the ensuing Annual General Meeting. They are, however, eligible for re-appointment. They have furnished a Certificate to the effect that their appointment will be in accordance with limits specified in sub-section (Ib) of Section 224 of the Companies Act, 1956 (corresponding Section 139 read with Section 141 of the Companies Act, 2013). yo u are requested to consider their appointment.

20. Cost Auditors

Cost Audit records have been maintained in respect of Grey Cement and White Cement for the year 2013- 14. Pursuant to the directives of the Central Government and provisions of Section 233b of the Companies Act, 1956 (corresponding Section 148 of the Companies Act, 2013), qualified Cost Auditors have been appointed to conduct the cost audit of Cement units for the year 2014-15.

21. Corporate Social Responsibility (CSR)

Corporate Social Responsibility is an integral part of the Company''s ethos and policy and it has been pursuing this on a sustained basis. The Company assists in running of Schools at their Cement Plants, ITIs and Sir Padampat Singhania University, Udaipur, imparting value based education to students. During the period under report the

Company played a constructive role in infrastructural development of surrounding areas. Various sports and cultural events were organized at the Schools and also at all the plants. Technical education and training are imparted through Industrial Training Centres at nimbahera and Kanpur Emphasis was laid on creation of awareness amongst the villagers about the need to protect the environment. CSR activities carried out by the Company have strengthened the relationship with local people. During the year under report your Company constituted CSR Committee and drawn up Company''s CSR policy to plan and implement CSR activities as per provision of Companies Act, 2013

22. Acknowledgements

Your Directors wish to place on record their appreciation for the valuable support received by your Company from banks, Govt. of Rajasthan, Govt. of Karnataka, Central Govt. and Government of Fujairah. The board thanks the employees at all levels for their dedication, commitment and hard work put in by them for Company''s achievements. your Directors are grateful to the Shareholders/Stakeholders for their confidence and faith reposed in board.

For and on behalf of the Board

Dr Gaur Hari Singhania

Chairman

Place : Kanpur

Dated : 17th May 2014.


Mar 31, 2013

Dear Members,

The Directors Have Pleasure In Submitting Their Nineteenth Annual Report And Audited Statements Of Accounts For The Year Ended 31st March, 2013.

1. FINANCIAL RESULTS

Rs. In Lacs

2012-13 2011-12

Gross Turnover 334193 288351

Profit Before Depreciation And Tax 46888 41137

Less: Depreciation 12826 12558

Profit Before Tax 34063 28579

Tax Expense (Including Deferred Tax And 10708 10845 Tax Adjustment Of Earlier Years)

Profit After Tax 23355 17733

Add: Balance Brought Forward From 27716 20179 Previous Year

Less: Appropriation

Transfer To General Reserve 6000 5000

Transfer To Debenture Redemption 1133 1133 Reserve

Dividend To Equity Shares (Including Tax 5318 4063 Thereon)

Balance To Be Carried Forward 38620 27716

2. OVERALL PERFORMANCE

Your Company''s Performance During The Year Under Review Has Improved In Terms Of Production, Sales Quantity As Well As Turnover And Profitability.

The Company''s Gross Turnover Increased To Rs. 3342 Crore During The Year, Compared To Rs. 2883 Crore In The Previous Year. Profit Before Depreciation & Tax Achieved At Rs. 469 Crore, Compared To Rs. 411 Crore In The Previous Year.

3. CONSOLIDATED FINANCIAL , STATEMENTS

The Statement As Required Under Section 212 Of The Companies Act, 1956, With Respect To The Subsidiaries Of The Company Viz. J.K. Cement (Fujairah) Fzc And J.K. Cement Works (Fujairah) Fzc Is Annexed And Forms An Integral Part Of This Report. Consolidated Financial Statements Form A Part Of The Annual Report And Accounts. In Terms Of General Circular Nos.2/2011 And 22/2011 And Board''s Decision, Attaching Of The Audited Balance Sheets As At 31st March, 2013 As Required Under Section 212 (8) Of The Companies Act, 1956 In Respect Of The Subsidiaries Of The Company Have Been Dispensed With. However, The Requisite Information For Each Subsidiary Has Been Disclosed. The Annual Accounts Of The Subsidiary Companies And The Related Detailed Information Will Be Made Available To The Investors Of The Company Seeking Such Information.

4. DIVIDEND

Your Directors Are Pleased To Recommend Dividend Of Rs. 6.50 Per Share For The Financial Year Ended 31st March, 2013 Compared To Rs. 5 Per Share Paid For The Financial Year Ended 31st March, 2012.

5. OPERATIONS

Grey Cement

During The Year Under Review, In Respect Of Grey Cement Plants In Rajasthan And Karnataka, Production Increased By 6.89% At 5.68 Millon Tonnes (Compared To 5.32 Million Tonnes Last Year) And Sales By 6.15% At 5.66 Million Tonnes (Compared To 5.33 Million Tonnes Last Year).

White Cement

Production Of White Cement Increased By 16.69% At 4.4 Lac Tonnes During The Year, Compared To 3.77 Lac Tonnes In The Previous Year. While Value- Added Products Registered Increase Of 43.7%. Sale Was Also In Tandem With Production. Increase In Volume Of White Cement And Value-Added Products (Wall Putty) And Other Cost Cutting Measures Resulted In Higher Contribution During The Year, As Compared To The Previous Year.

6. PROJECTS OF THE COMPANY

Expansion Initiatives

During The Year Under Review Your Company Decided To Implement A Brownfield Grey Cement Expansion Of 3 Million Tonnes Per Annum By Setting Up New Production Line At The J.K. Cement Works, Mangrol With A Split Grinding Unit In Haryana At Jharli, Dist: Jhajjar And In This Regard Financial Closure Has Been Made. Orders For All Long Delivery Items And Auxiliaries Have Already Been Placed. Civil Work At Site Is In Full Swing. Barring Unforeseen Circumstances, The Management Expects To Implement The Project By The Second Quarter Of 2014-15.

7. PROJECTS OF SUBSIDIARY/JOINT , VENTURE COMPANY IN HAND

(A) Projects Under Subsidiary Company:

Cement Plant At Fujairah, UAE

Your Company Has Been Implementing A Greenfield Dual Process Cement Plant Having Capability Of Producing Either 0.6 Million Tonnes Of White Cement Or 1 Million Tonnes Of Grey Cement Or A Combination Of Both, Depending Upon The Market Condition In The Gcc Region, Under The Subsidiary, J.K. Cement Works (Fujairah) Fzc, Uae, Which Is A Joint Venture Company With The Government Of Fujairah Establishment. Work Is Progressing As Per The Schedule And The Management Expects To Implement The Project By The Fourth Quarter Of 2013-14.

(B) Project Under Joint Venture:

Captive Coal Block In Maharashtra

As Reported Earlier, A Joint Venture Company Viz. Bander Coal Company Private Limited (''The Jv Company'') Was Incorporated With Equity Contribution Of Other Two Companies. The Jv Company Had Filed Revised Mining Plan And Subsidence Prediction Report. Clearance From Ministry Of Environment & Forest Has Been Received With Certain Stipulations, Which Are Being Complied With By The Jv Company.

8. FINANCE

During The Year Under Review Your Company Has Availed Additional Term Loan Of Rs. 95 Crore From Various Banks And Repaid Rs. 149 Crore. On The Company''s Endeavours The Lenders Of Karnataka Term Loan Reduced The Rate Of Interest By 0.5% And For Cash Credit Limits Also, The Interest Rate Has Been Reduced By 1.25%. Considering The Size Of Operation, The Working Capital Limit Has Been Increased By Rs. 100 Crore (From Rs. 425 Crore To Rs. 525 Crore) By The Lenders At The Company''s Request.

9. CREDIT RATING

For Long-Term Bank Facilities Care Has Improved Your Company''s Rating From "Care A " To "Care AA-"And For Short-Term Bank Facilities, Care Has Reaffirmed "Care A1 " Rating .

10. MATTER OF EMPHASIS

The Competition Commission Of India ("Cci"), On The Complaint Filed By Builders Association Of India On The Ground Of Alleged Contravention Of Competition Law, In Case No.29/2010 Passed An Order Dated 20th June, 2012, Imposing Total Penalty Of Rs. 6307 Crore Against Cement Manufacturers'' Association And 11 Cement Companies Including Rs. 128.54 Crore On Your Company. Your Company Has Been Advised By Legal Counsel That It Has A Good Case And Accordingly, Stay Petition And Appeal Were Preferred Before The Competition Appellate Tribunal Which, Have Been Heard And Order Reserved. No Provision In The Books Of Account Has Been Considered Necessary By Your Company.

11. SUBSIDIARY COMPANIES

A Statement Pursuant To Section 212 Of The Companies Act, 1956 Is Annexed.

12. CORPORATE GOVERNANCE

A Report On Corporate Governance Is Enclosed As Part Of The Annual Report Along With The Auditors'' Certificate On Its Compliance.

13. PERSONNEL

13.1 Industrial Relations

The Industrial Relations During The Period Under Review Generally Remained Cordial At All Cement Plants.

13.2 Particulars Of Employees

List Of Employees Getting Salary In Excess Of The Limits As Specified Under The Provisions Of Sub-Section (2A) Of Section 217 Throughout Or Part Of The Financial Year Under Review Is Annexed. However, In Terms Of Provisions Of Section 219(1) (B)(Iv) Of The Act, The Annual Report, Excluding The Aforesaid Information, Is Being Sent To All The Members Of The Company. Any Member Interested In Obtaining Such Particulars May Send The Request To The Company At Its Registered Office.

14. PUBLIC DEPOSITS

Your Company Has Not Invited Any Deposits From Public/Shareholders In Accordance With The Section 58A Of The Companies Act, 1956.

15. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO.

Particulars With Regard To Conservation Of Energy, Technology Absorption, Foreign Exchange Earnings And Outgo In Accordance With The Provisions Of Section 217(1) (E) Of The Companies Act, 1956 Read With The Companies (Disclosures Of Particulars In The Report Of Board Of Directors) Rules, 1988, In Respect Of Cement Plants, Are Annexed And Form Part Of The Report.

16. AUDITORS'' REPORT

Auditors'' Report To The Shareholders Does Not Contain Any Qualification.

17. DIRECTORS

Three Of Your Directors, Namely Shri Raj Kumar Lohia, Shri Achintya Karati And Shri Ashok Sharma, Will Retire By Rotation At The Ensuing Annual General Meeting And Being Eligible, Offer Themselves For Reappointment.

18. DIRECTORS'' RESPONSIBILITY STATEMENT

The Directors Confirm That:

(I) In The Preparation Of The Annual Accounts, The Applicable Accounting Standards Have Been Followed And That No Material Departures Have Been Made From The Same;

(Ii) They Have Selected Such Accounting Policies And Applied Them Consistently And Made Judgments And Estimates That Are Reasonable And Prudent So, As To Give A True And Fair View Of The State Of Affairs Of The Company At The End Of The Financial Year And Of The Profit Of The Company For That Year;

(Iii) They Have Taken Proper And Sufficient Care For 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) They Have Prepared The Annual Accounts On A Going Concern Basis.

19. AUDITORS

M/S. P.L. Tandon & Co., Chartered Accountants, Kanpur, Auditors Of The Company, Will Retire From Their Office At The Ensuing Annual General Meeting. They Are, However, Eligible For Re-Appointment. They Have Furnished A Certificate To The Effect That Their Appointment Will Be In Accordance With Limits Specified In Sub-Section (1b) Of Section 224 Of The Companies Act, 1956. You Are Requested To Consider Their Appointment.

20. COST AUDITORS

Cost Audit Records Have Been Maintained In Respect Of Grey Cement And White Cement For The Year 2012- 13. Pursuant To The Directives Of The Central Government And Provisions Of Section 233B Of The Companies Act, 1956, Qualified Cost Auditors Have Been Appointed To Conduct The Cost Audit Of Cement Units For The Year 2012-13.

21. CORPORATE SOCIAL RESPONSIBILITY (CSR)

Corporate Social Responsibility Is An Integral Part Of The Company''s Ethos And Policy And It Has Been Pursuing This On A Sustained Basis.

The Company Assists In Running Of A School And Sir Padampat Singhania University, Udaipur, Imparting Value-Based Education To Students. During The Period Under Review The Company Played A Constructive Role In Infrastructural Development Of Surrounding Areas Viz. Construction/ Repairing Of Roads, Boundary Of Panchayat School Building And Mangrol Graveyard, Temples, Organised Medical Camp, Supplied Drinking Water. Various Sports And Cultural Events Were Organised At The Schools And Also At All The Plants. Technical Education And Training Are Imparted Through Industrial Training Centres At Nimbahera And Kanpur. Emphasis Was Laid On Creation Of Awareness Amongst The Villagers About The Need To Protect The Environment. Csr Activities Carried Out By The Company Have Strengthened Its Relationship With Local People.

22. ACKNOWLEDGEMENTS

Your Directors Wish To Place On Record Their Appreciation For The Valuable Support Received By Your Company From Banks, Govt. Of Rajasthan, Govt. Of Karnataka, Govt. Of Haryana, Central Govt. And Government Of Fujairah. The Board Also Thanks The Employees At All Levels For Their Dedication, Commitment And The Hard Work Put In By Them For The Company''s Achievements.

For And On Behalf Of The Board

Place : Kanpur Dr. Gaur Hari Singhania

Dated : 11th May, 2013 Chairman


Mar 31, 2012

The Directors have pleasure in submitting their eighteenth Annual Report and audited statements of accounts for the year ended 31st March, 2012.

1. FINANCIAL RESULTS

(Rs in lakhs)

2011-12 2010-11

Gross Turnover 254679 209435

Profit before depreciation and tax 41137 19641

Less: Depreciation 12558 11273

Profit Before Tax 28579 8368

Provision for Tax: - -

- Fringe Benefit Tax - -

- Current Tax 7033 1640

less: MAT Credit entitlement for current year plus tax - (-)1640 adjustments for earlier years

- earlier years tax 1991 (-) 547

- Deferred Tax 1821 2510

Profit After Tax 17733 6405

Add: Balance brought forward from previous year 37911.74 23586.26

less: Appropriation

Transfer to General Reserve 5000.00 650.00

Transfer to Debenture Redemption Reserve 1132.50 1132.50

Dividend on equity Shares (including tax thereon) 4063.56 1625.43

Balance to be carried forward 27715.68 20178.33

2. OVERALL PERFORMANCE

Your Company's performance during the year under report has improved in terms of production, sales quantity as well as turnover and profitability.

The Company's turnover increased to Rs 2547 Crores during the year compared to Rs 2094 Crores in previous year. Profit before Depreciation & Tax achieved at Rs 411 Crores compared to Rs 196 Crores.

3. CONSOLIDATED FINANCIAL STATEMENTS

The statement as required under Section 212 of the Companies Act, 1956, in respect of the subsidiaries of the Company viz. J.K. Cement (Fujairah) FZC and J.K.Cement Works (Fujairah) FZC is annexed and form an integral part of this Report. Consolidated Financial Statements form part of the Annual Report and Accounts. In terms of General Circular Nos.2/2011 and 22/2011 and Board's decision, attaching of the Audited Balance Sheets as at 31st March, 2012 as required under Section 212 (8) of the Companies Act, 1956 in respect of the subsidiaries of the Company have been dispensed with. However, the requisite information for each subsidiary has been disclosed. The annual accounts of the subsidiary companies and the related detailed information will be made available to the investors of the Company seeking such information.

4. DIVIDEND

Your Directors are pleased to recommend dividend of Rs 5 per share for the financial year ended 31st March, 2012 compared to Rs 2 per share paid for the financial year ended 31st March, 2011.

5. OPERATIONS GREY CEMENT

During the year under report, in respect of grey cement plants in Rajasthan and Karnataka production increased by 3.2% at 5.32 Million Tons (compared to 5.15 Million Tons last year), despatches by 3.64% at 5.33 Million Tons (compared to 5.14 Million Tons last year) and sales by 4.17% at 5.33 Million Tons (compared to 5.11 Million Tons last year). The contribution during the year was comparatively higher.

White cement

Production of White Cement increased by 7.31% at 3.77 Lacs tonne during the year compared to 3.51 Lacs tonne while value added products registered increase of 26.68%. Sale was also in tandem with production. Increase in volume of white cement and value added products (wall putty) and other cost cutting measures resulted in higher contribution during the year as compared to previous year.

6. PROJECTS OF THE COMPANY EXPANSION INITIATIVES

Your Company is revisiting the size of proposed expansion plan at Mangrol, Rajasthan from earlier envisaged 3.5 Million Tons to around 2.5 Million Tons, on account of delay in allotment of new mining area to the Company. viability study for 2.5 Million Tons capacity plant is under preparation and a final decision will be taken during the course of the year.

7. PROJECTS OF SUBSIDIARY/JOINT VENTURE COMPANY IN HAND

(a) Projects under Subsidiary company: cement Plant at Fujairah, uAE

Your Company has now finalised the size of the plant and it is proposed to set up a Greenfield dual process cement plant having capability of producing either 0.6 Million Tons of White Cement or 1 Million Tons of Grey Cement or a combination of both depending upon the market condition in GCC region, under the subsidiary, J.K Cement Works (Fujairah) FZC, UAE, which is a Joint venture Company with the Government of Fujairah.

The Company has awarded the EPC contract for the plant and the work at site has already begun. The plant is expected to be on stream by 31st March, 2014.

The funding for the project has already been finalised and the loan agreement is likely to be executed within June, 2012.

(b) Project under Joint Venture: captive coal Block in Maharashtra

As reported earlier a Joint venture Company viz. Bander Coal Company Private limited ('the Jv Company') was incorporated with equity contribution of other two companies. The Jv Company had filed revised mining plan and subsidence prediction report. Clearance from

Ministry of environment & Forest has been received with certain stipulations which are being complied with by the Jv Company.

8. FINANCE

During the year under report your Company has completed repayment of the final instalment of Term loan of Rs 462.50 Crores availed in 2004 consequent upon which the personal guarantees extended and shares pledged by the Promoters for availing such loan has been released by the lenders. The Company, during the year, has availed additional term loan of Rs 49.96 Crores and repaid Rs 182.17 Crores. On Company's endeavour the lenders of Karnataka Term loan reduced the rate of interest by 0.5% and for Cash credit limits also the interest rate has been reduced by 0.5%. Considering the size of operation the Working Capital limit has been increased by Rs 100 Crores by the lenders.

9. CREDIT RATING

For long term bank facilities Care has maintained your Company's rating of "CARE A " and for short term bank facilities assigned "CARE A1 " rating.

10. SUBSIDIARY COMPANIES

A statement pursuant to Section 212 of the Companies Act, 1956 is annexed.

11. CORPORATE GOVERNANCE

A report on Corporate Governance is enclosed as part of Annual Report alongwith the Auditors' Certificate on its compliance.

12. PERSONNEL

12.1 INDUSTRIAL RELATIONS

The industrial relations during the period under review generally remained cordial at all Cement plants.

12.2 PARTICULARS OF EMPLOYEES

List of employees getting salary in excess of the limits as specified under the provisions of sub-section (2A) of Section 217 throughout or part of the financial year under review is annexed. However, in terms of provisions of section 219(1)(b)(iv) of the Act, the Annual Report excluding the aforesaid information is being sent to all the members of the Company. Any member interested in obtaining such particulars may send the request to the Company at its Registered Office.

13. PUBLIC DEPOSITS

Your Company has not invited any deposits from public / shareholders in accordance with the Section 58A of the Companies Act, 1956.

14. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO.

Particulars with regard to Conservation of energy, Technology Absorption, Foreign exchange earnings and out go in accordance with the provisions of Section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosures of particulars in the Report of Board of Directors) Rules, 1988 in respect of Cement plants are annexed and form part of the Report.

15. AUDITORS' REPORT

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

16. DIRECTORS

Three of your Directors namely Shri Jayant Narayan Godbole, Shri Suparas Bhandari and Shri Kailash Nath Khandelwal will retire by rotation at the ensuing Annual General Meeting and being eligible, offer themselves for reappointment.

17. DIRECTORS' RESPONSIBILITY STATEMENT

The Directors confirm that:

(i) in the preparation of the annual accounts, the applicable accounting standards have been followed and that no material departures have been made from the same.

(ii) they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that year;

(iii) they have taken proper and sufficient care for 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) they have prepared the annual accounts on a going concern basis.

18. AUDITORS

M/s. P.L. Tandon & Co., Chartered Accountants, Kanpur, Auditors of the Company, will retire from their office at the ensuing Annual General Meeting.

They are, however, eligible for re-appointment.

They have furnished a Certificate to the effect that their appointment will be in accordance with limits specified in sub-section (IB) of Section 224 of the Companies Act, 1956. You are requested to consider their appointment.

19. COST AUDITORS

Cost Audit records have been maintained in respect of Grey Cement and White Cement for the F.Y.2011-12. Pursuant to the directives of the Central Government and provisions of Section 233B of the Companies Act, 1956, qualified Cost Auditors have been appointed to conduct the cost audit of Cement units for the F.Y.2011-12.

20. CORPORATE SOCIAL RESPONSIBILITY (CSR)

Corporate Social Responsibility is an integral part of the Company's ethos and policy and it has been pursuing this on a sustained basis. The Schools assisted by your Company provide education of high standard not only to the children of the Company's employees but also to the children of surrounding villages. Sir Padampat Singhania University, Udaipur, assisted by your Company, imparting value based education to students. various sports and cultural events were organised at the Schools and also at all the plants. Technical education and training are imparted through Industrial Training Centres at Nimbahera and Kanpur. emphasis was laid on creation of awareness amongst the villagers about the need to protect the environment. CSR activities carried out by the Company have strengthened the relationship with local people.

21. ACKNOWLEDGEMENTS

Your Directors wish to place on record their appreciation for the valuable support received by your Company from Banks, Govt. of Rajasthan,

Govt. of Karnataka, Central Govt. and Government of Fujairah. The Board also thanks the employees at all levels for their dedication, commitment and hard work put in by them for Company's achievements.



For and on Behalf of the Board

Dr. Gaur Hari Singhania

CHAIRMAN

Place : Kanpur

Dated : 26th May 2012


Mar 31, 2011

The Directors have pleasure in submitting their Seventeenth Annual Report and audited statements of accounts for the year ended 31st March, 2011.

1. FINANCIAL RESULTS

Rs.Lacs

2010-11 2009-10

Gross Turnover 265208.80 224806.61

Profit before depreciation and tax 19651.05 39676.80

Less: Depreciation 11273.34 8550.94

Profit Before Tax 8377.71 31125.86

Provision for Tax:

- Fringe Benefit Tax

-Current Tax 1650.00 5303.00

Less: MAT Credit entitlement for current year plus tax adjustments for (-)2186.79 (-)5297.00 earlier years

- Deferred Tax 2510.00 8520.00

profit After Tax 6404.50 22599.86

Add: Balance brought forward from the previous year 17181.76 14489.48

Less: On amalgamation - (-)8.36

Less: Transfer to General Reserve 650.00 15000.00

Less: Transfer to Debenture Redemption Reserve 1132.50 -

Less: Dividend on Equity Shares (including tax thereon) 1625.43 4899.22

Balance to be carried forward 20178.33^ 17181.76

2. OVERALL PERFORMANCE

Your Companys performance during the year under report has improved both in terms of production, sales quantity as well as turnover. However, due to depressed market condition prevailed in overall cement industry the profitability have depleted.

The Companys turnover increased to Rs. 2652.09 Crore during the year compared toRs. 2248.07 Crore in previous year. Profit before Depreciation &Tax achieved at Rs. 196.51 Crore compared to Rs. 396.77 Crore inspite of increased volumes due to higher input cost and decrease in margin.

3. CONSOLIDATED FINANCIAL STATEMENTS

The statement as required under Section 212 of the Companies Act, 1956, in respect of the subsidiaries of the Company viz. J.K.Cement (Fujairah) FZC and J.K.Cement Works (Fujairah) FZC is annexed and forms an integral part of this Report. Consolidated Financial Statements form part of the Annual Report and Accounts. In terms of General Circular Nos.2/2011 and 22/2011 and Boards decision, attaching of the Audited Balance Sheets as at March 31, 2011 as required under Section 212 (8) of the Companies Act, 1956 in respect of the subsidiaries of the Company have been dispensed with. However, the requisite information for each subsidiary has been disclosed. The annual accounts of the subsidiary companies and the related detailed information will be made available to the investors of the Company seeking such information.

4. DIVIDEND

Your Directors are pleased to recommend dividend ofRs. 2.00 per share for the financial year ended 31st March, 2011 compared to Rs. 6.00 per share paid for the financial year ended 31st March, 2010.

5 OPERATIONS

Grey Cement

During the year under report, production of grey cement in Rajasthan plants reduced by 7.3% at 3.68 Millon Tonnes as against 3.97 Million Tonnes during the pervious year, however taking together Rajasthan and Kamataka plant, production increased by 20% at 5.15 Million Tonnes compared to 4.29 Million Tonnes during pervious year. The contribution during the year was comparatively lower.

White Cement

Production of White Cement increased by 16.6% at 3.51 Lakh tonnes during the year compared to 3.01 Lakh tonnes while value added products registered increase of 55%. Sale was also in tandem with production. The contribution of both the products during the year was comparatively higher.

6. PROJECTS OF THE COMPANY

EXPANSION INITIATIVES

Your Company in its effort to add capacity has already proposed implementation of expansion of Grey Cement in North India. Now, it has been finalized to set up a brownfield cement project of capacity of 3.5 MnTPA through an integrated unit of 8000 tpd clinker production at existing J.K.Cement Works, Mangrol site and a split located grinding unit at Jhajhar, Haryana in North India. The combined grinding capacity at integrated unit and split unit would be 4 MnTPA. The cost of the project is now estimated at Rs. 2326.65 Crore including captive power plant of 35 MW and Waste Heat Recovery Plant of 15 MW. The Company has already purchased land at Jhajhar and applied for lease of new limestone mining area close to Mangrol site. Work at site is likely to start in October, 2011 and tentative schedule for completion is December, 2014

7. PROJECTS OF SUBSIDIARY/JOINT VENTURE COMPANY IN HAND

(a) Projects under Subsidiary Company:

Cement Plant at Fujairah, UAE As reported last your Company had taken up establishment of a green field Grey Cement Plant in free trade zone at Fujairah, U.A.E. under its subsidiary, J.K.Cement Works (Fujairah) FZC, U.A.E. which is a joint venture company with Fujairah Investment, an undertaking of Government of Fujairah holding 10% equity. However, in view of change in business scenario in U.A.E, the Company is now planningto set up a small size plant of white cement convertible into Grey Cement to produce grey and white cement both according to the market demand. The project report for the same is under preparation. After finalization of the report, proposal for funding would be taken up with the Banks who have shown interest to fund the project.

(b) Project under Joint Venture:

Captive Coal Biock in Maharashtra As reported earlier a Joint Venture Company viz. Bander Coal Company Private Limited (the JV Company) was incorporated with equity contribution of other two companies. The JV Company had filed application for grant of Mining Lease for extraction of Coal over an area of 1604.67 Hectare area in Distt. Chandrapur, Maharashtra. Steps for preparation of amended Mining Plan and other approvals including forest clearance has also been initiated.

8. FINANCE

Duringtheyear under report your Company has availed additional Term Loan ofRs. 101.59 Crores and repaid Rs. 199.30 Crores. To augment long term finance, your Company also issued Secured Redeemable (redeemable in 7th, 8th, 9th and 10th years) Non Conventible Debentures ofRs. 400 Crore on private placement basis.

9. CREDIT RATING

For long term bank facilities CARE has maintained your Companys rating of "CARE A+" and for short term bank facilities assigned "PR1+" rating.

10. SUBSIDIARY COMPANIES

A statement pursuant to Section 212 of the Companies Act, 1956 is annexed.

11. CORPORATE GOVERNANCE

A report on Corporate Governance is enclosed as part of Annual Report alongwith the Auditors Certificate on its compliance.

12. PERSONNEL

12.1 INDUSTRIAL RELATIONS

The industrial relations duringthe period under review generally remained cordial at all Cement plants.

12.2 PARTICULARS OF EMPLOYEES

List of employees getting salary in excess of the limits as specified under the provisions of sub- section (2A) of Section 217 throughout or part of the financial year under review is annexed. However, in terms of provisions of section 219(1) (b)(iv) of the Act, the Annual Report excluding the aforesaid information is being sent to all the members of the Company. Any member interested in obtaining such particulars may send the request to the Company at its Registered Office.

13. PUBLIC DEPOSITS

Your Company has not invited any deposits from public / shareholders in accordance with the Section 58A of the Companies Act, 1956.

14. CONSERVATION Of ENERGY, TECHNOLOGY ABSORP- TION, FOREIGN EXCHANGE EARNINGS AND OUTGO

Particulars with regard to Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and out go in accordance with the provisions of Section 217(l)(e) of the Companies Act, 1956 read with the Companies (Disclosures of particulars in the Report of Board of Directors) Rules, 1988 in respect of Cement plants are annexed and form part of the Report.

15. AUDITORS* REPORT

Auditors Report to the shareholders does not contain any qualification.

16. ABRIDGED BALANCE SHEET

The Company shall be sending Abridged Balance Sheet to all its members as permitted by SEBI guidelines dated 26th April, 2007. Full Balance Sheet shall be placed on Companys Website. Members, who are desirous of getting full Balance Sheet may send their request to the Company Secretary at the Registered Office address of the Company.

17. DIRECTORS

The Board of Directors have reappointed Shri Yadupati Singhania as Managing Director & CEO at its meeting held on 28th May, 2011, for a period of 5 years w.e.f. 1st April, 2012 on the terms and conditions enumerated in the resolution being put for your approval.

Three of your Directors namely Shri Ashok Sharma, Dr. K.B.Agarwal and Shri J.P.Bajpai will retire by rotation at the ensuing Annual General Meeting and being eligible, offer themselves for reappointment..

18. DIRECTORS RESPONSIBILITY STATEMENT The Directors confirm that:

(i) in the preparation of the annual accounts, the applicable accounting standards have been followed and that no material departure have been made from the same;

(ii) they have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that year;

(iii) they have taken proper and sufficient care for 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

19. AUDITORS

M/s. P.L. Tandon & Co., Chartered Accountants, Kanpur, Auditors of the Company, will retire from their office at the ensuing Annual General Meeting. They are, however, eligible for re-appointment. They have furnished a Certificate to the effect that their appointment will be in accordance with limits specified in sub-section (IB) of Section 224 of the Companies Act, 1956. You are requested to consider their appointment.

20. COST AUDITORS

Cost Audit records have been maintained in respect of Grey Cement and White Cement for the year 2010-11. Pursuant to the directives of the Central Government and provisions of Section 233B of the Companies Act, 1956, qualified Cost Auditors have been appointed to conduct the cost audit of Cement units for the year 2010-11.

21. ACKNOWLEDGEMENTS

Your Directors wish to place on record their appreciation for the valuable support received by your Company from Banks, Govt, of Rajasthan, Govt, of Kamataka and Central Govt. The Board also thanks the employees at all levels for their dedication, commitment and hard work put in by them for Companys achievements,

FOR AND ON BEHALF OF THE BOARD

Gaur hari singhania

CHAIRMAN Place : Kanpur.

Date : 28th May2011







 
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