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Directors Report of Kakatiya Textiles Ltd.

Mar 31, 2015

Dear Members,

The Directors present their 33rd Annual Report of the Company for the financial year 2014-15 together with the Balance Sheet as at 31st March 2015 and the Statement of Profit & Loss for the year ended on that date

FINANCIAL RESULTS:

(Rs, in Lakhs)

Particulars 31.03.2015 31.03.2014

Total Income 1068.80 2,390.34

Profit before Depreciation, Interest & Tax for the year (110.29) (19.93)

Depreciation for the year 19.51 1.82

Finance Cost - -

Deferred Tax Liability / (Asset) - 23.90

Net Profit / (Loss) (129.80) (45.65)

MANAGEMENT DISCUSSION AND ANALYSIS

INDUSTRY CONDITIONS AND REVIEW OF OPERATIONS

The cotton textile industry in India had to contend with major challenges during the year. Yarn prices remained depressed on lower demand even though the cotton prices were lower compared to earlier years. Consequently, the operations of your company also came under severe strain during the year under review resulting in lower sales and losses. Sale of yarn and price realization have been considerably lower this year on account of poor demand for yarn.

COMPANY OUTLOOK

During the current year, power outage and labour shortage are major concerns which could have impact on operations of the Company. Higher inflation would have adverse impact on the growth of the Company.

OPPORTUNITIES AND THREATS

The textile industry is much dependent upon the availability of quality raw materials. Fluctuation in the price of raw material will influence the profitability of the Company. Power and labour shortage also affects the operations of the Company.

DIVIDEND

On account of accumulated losses your Directors are unable to recommend dividend for the year ended 31st March 2015.

TRANSFER TO RESERVES

Due to the accumulated losses incurred, the company is unable to transfer any amount to its reserves.

CORPORATE UPDATES - OPEN OFFER:

The erstwhile Promoters of the company had entered into a Share Purchase Agreement with Mr. Vanka Ravindra Nath, Mrs. Vanka Rajakumari, Mr. Vanka Raghuveer and Ms. Vanka Ravali, together known as acquirers, on 4th May, 2015, to acquire 50.47 % of the total Equity Share Capital and 50.70 % of the total voting power. The acquirers have made an application to SEBI for an Open Offer to acquire up to 15,10,800 Equity Shares of Rs, 10 each, representing 26% of the Total Equity Share Capital of our company from our Public Shareholders at a price of Rs, 7.00 (Rupees Seven only) per fully paid up Equity Share and Rs, 2.00 (Rupees Two Only) per partly paid-up Equity Share. The acquirers have nominated Mr. Vanka Ravindra Nath and Mrs. Vanka Rajakumari as Directors on the Board of the Company.

The Open Offer to the Public Shareholders of our Company as per SAST Regulations opened on the 12th August, 2015 and ended on the 25th August, 2015.

TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND

Since the Company has not declared any dividends, there is no unclaimed dividend to be transferred to Investor Education and Protection Fund.

SHARE CAPITAL

The issued, subscribed and paid-up share capital of the Company as at 31.03.2015 stood at Rs, 10,78,50,000/- divided into 58,10,600 equity shares of Rs, 10/- each and 5,00,000 - 9% Cumulative Redeemable Preference Shares of Rs, 100/- each. During the year under review the Company has not made any fresh issue of shares.

EXTRACT OF ANNUAL RETURN

The extract of Annual Return in the prescribed Form No.MGT-9 pursuant to Section 92(3) read with Rule 12 of the Companies (Management and Administration) Rules, 2014 is furnished as Annexure 1 and is attached to this Report.

BOARD MEETINGS CONDUCTED DURING THE PERIOD UNDER REVIEW

The Company had conducted Four (4) Board meetings during the period under review. Further details on the Board and Committee meetings held during the year have been enumerated in the Corporate Governance Report which is annexed to this report.

DIRECTORS' RESPONSIBILITY STATEMENT

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

(a) in the preparation of the annual accounts, the applicable accounting standards had been followed and there are no material departures from those standards;

(b) the directors had selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the loss of the company for that period;

(c) the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

(d) the directors had prepared the annual accounts on a going concern basis;

(e) the directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and operating effectively and

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

DECLARATION OF INDEPENDENT DIRECTORS

The Company has received declarations from all the Independent Directors of the Company confirming that they meet the criteria of independence as prescribed under both the Companies Act, 2013 and Clause 49 of the Listing Agreement with the Stock Exchanges.

COMPANY'S POLICY RELATING TO DIRECTORS APPOINTMENT, PAYMENT OF REMUNERATION AND OTHER MATTERS PROVIDED UNDER SECTION 178(3) OF THE COMPANIES ACT, 2013.

The Company's Policy relating to appointment of Directors, payment of Managerial remuneration, Directors' qualifications, positive attributes, independence of Directors and other related matters as provided under Section 178(3) of the Companies Act, 2013 is furnished in Annexure 2 and is attached to this report and can also be accessed on the Company's website www.kakatiyatextiles.com.

AUDITORS' REPORT

There were no qualifications, reservations, adverse remarks or disclaimers made by the M/s. S Murali Dharan & Co., Statutory Auditors and Ms. B Veena, Secretarial Auditor in their report.

PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS MADE UNDER SECTION 186 OF THE COMPANIES ACT, 2013

The Company has not granted any loans or given any security or made any investments pursuant to the provisions of Section 186 of the Companies Act, 2013 during the year under review.

PARTICULARS OF CONTRACTS OR ARRANGEMENTS WITH RELATED PARTIES

All transactions entered into with related parties as defined under the Companies Act, 2013 during the financial year 2014-15 were in the ordinary course of business and on an arm's length basis. Since there are no transactions which are not on arm's length basis and material in nature the requirement of disclosure of such related party transactions in Form AOC-2 does not arise.

The policy on related party transactions as approved by the Board of Directors of the Company has been uploaded on the company's website and may be accessed through the website at www.kakatiyatextiles.com

MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There have been no material changes and commitments affecting the financial position of the Company which has occurred between the financial year ended 31st March, 2015 and the date of the report.

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

The information pertaining to conservation of energy, technology absorption, Foreign Exchange Earnings and outgo as required under section 134(3)(m) of the Companies Act, 2013 read with Rule 8(3) of the Companies (Accounts) Rules, 2014 is attached herewith as Annexure 3 to this report.

STATEMENT CONCERNING DEVELOPMENT AND IMPLEMENTATION OF RISK MANAGEMENT POLICY OF THE COMPANY

The Company has a structured risk management policy. The Risk management process is designed to safeguard the organization from various risks through adequate and timely actions. It is designed to anticipate, evaluate and mitigate risks in order to minimize its impact on the business. The potential risks are inventoried and integrated with the management process such that they receive the necessary consideration during decision making

WHISTLE BLOWER POLICY (VIGIL MECHANISM)

The details of the composition of the Audit Committee have been enumerated in the Corporate Governance Report which forms a part of the Board's report. The Company has formulated a whistle blower policy in line with the provisions of Section 177 of the Companies Act, 2013 and Clause 49 of the listing agreement to enable the directors and employees to report concerns about unethical behavior, actual or suspected fraud or violation of the company's code of conduct or ethics policy. The policy also provides for adequate safeguards against victimization of director(s) / employee(s) who avail of the mechanism and also provides for direct access to the Chairman of the Audit Committee in exceptional cases. The Whistle Blower policy has been uploaded on the company's website at www.kakatiyatextiles.com.

ANNUAL EVALUATION OF THE BOARD ON ITS OWN PERFORMANCE AND OF THE INDIVIDUAL DIRECTORS

In accordance with the criteria suggested by the Nomination and Remuneration Committee, the Board of Directors evaluated the performance of the Board, having regard to various criteria such as Board composition, Board processes, Board dynamics etc. The Independent Directors, at their separate meetings, also evaluated the performance of non-independent directors and the Board as a whole based on various criteria.

The performance of each Independent Director was evaluated by the entire board of directors on various parameters like engagement, leadership, analysis, decision making, communication, governance etc. The Board and the Independent Directors were of the unanimous view that performance of the Board of Directors as a whole was satisfactory.

The performances of all the Committees were evaluated by the Board having regard to various criteria such as committee composition, committee, processes, committee dynamics etc. The Board was of the unanimous view that all the committees were performing their functions satisfactorily.

DIRECTORS & KEY MANAGERIAL PERSONNEL

During the year under review, the Members have approved the appointment of Mr. C.S.K.Prabhu, Mr. Koteswara Rao S S R, Dr. I Venkat Rao as the Independent Directors of the Company for a period of 5 years.

The Members at the Annual General Meeting held on 29th September 2014 approved the appointment of Mr.Sumanth Ramamurthi as the Managing Director of the Company for a period of three years with effect from 30th May 2014.

During the year Ms. Hemalatha Ramamurthi, was appointed as Additional Director of the Company. Further Mr. Vanka Ravindra Nath and Mrs. Vanka Raja Kumari were appointed as additional directors on the board of the company pursuant to the Share Purchase Agreement entered by the erstwhile promoter and the acquirers of the company.

Mr. R Narayanan was appointed as the Chief Financial Officer of the Company with effect from 5th November 2014.

Mr. Sumanth Ramamurthi, Managing Director of the Company, retires by rotation at the ensuing Annual General Meeting and expressed his unwillingness to reappoint as Director of the Company.

Your Directors recommend his re-appointment.

FIXED DEPOSITS

Since the Company has not accepted any fixed deposits covered under Chapter V of the Companies Act, 2013, there are no deposits remaining unclaimed or unpaid as on 31st March 2015 and accordingly, the question of default in repayment of deposits or payment of interest thereon, during the year, does not arise.

DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS OR TRIBUNALS IMPACTING THE GOING CONCERN STATUS AND COMPANY'S OPERATION IN FUTURE

There is no significant and material order passed by the regulators or courts or tribunals impacting the going concern status and company's operation in future.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has adequate internal control systems to monitor internal business process, financial reporting and compliance with applicable laws. The Company periodically reviews the adequacy and effectiveness of the control systems.

The Audit committee of the Board reviews internal control systems and their adequacy, significant risk areas, observations made by the internal auditors on control mechanism and the operations of the company, recommendations made for corrective action and the internal audit reports. The committee reviews with the statutory auditors and the management, key issues, significant processes and accounting policies.

AUDITORS

STATUTORY AUDITORS

M/s. S.Murali Dharan & Co, Chartered Accountants, Coimbatore retire at the ensuing Annual General Meeting and expressed their unwillingness to continue as Statutory Auditors of the Company. The Audit Committee & the Board of Directors recommend the appointment of M/s. Chevuturi Associates, Chartered Accountants (FR No.

000632S) as the Statutory Auditors of the Company. Further, company has received a certificate from the Statutory Auditors to the effect that their appointment, if made, would be within the limits prescribed under Section 139 of the Companies Act, 2013.

SECRETARIAL AUDITORS

Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Ms. B Veena, Company Secretary in Practice to undertake the Secretarial Audit of the Company. The report of the Secretarial Auditor is annexed herewith as Annexure 4 to this report.

PARTICULARS OF EMPLOYEES

The disclosure referred to the Rule 5(2) of Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 does not apply to the Company as there were no employees who are in receipt of remuneration in the aggregate at the rate of not less than Rs, 60,00,000/- if employed throughout the year or Rs, 5,00,000/- per month if employed for part of the year.

CORPORATE GOVERNANCE

As per Clause 49 of the Listing Agreement with the Stock Exchange, a report on Corporate Governance together with the Auditors Certificate regarding compliance of the conditions of Corporate Governance, Management Discussion and Analysis statement forms part of the Annual Report.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has in place a policy on Sexual Harassment of Women at workplace in line with the requirements of the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013. The company has constituted an internal complaints committee to address the complaints regarding sexual harassment. All employees are covered under this policy. The company has not received any complaints during the year under review.

PERSONNEL RELATIONS

Staff and Labour relations during the year at all units of the company continued to be cordial.

ACKNOWLEDGEMENTS

Your Directors wish to thank the Company's Bankers, Financial Institutions, Customers and Suppliers for their unstinted support and co-operation.

Your Directors wish to place on record their appreciation of the confidence reposed by the shareholders in the Company at all times.

The Board of Directors also wishes to thank the employees at all levels for their excellent support and contribution made by them.

By Order of the Board

Sumanth Ramamurthi

Place : Hyderabad Managing Director

Date : 13th August, 2015 DIN: 00002773


Mar 31, 2013

Dear Members,

The Directors present their 31st Annual Report of the company for the financial year 2012-13 together with the Balance Sheet as at 31st March 2013 and the statement of Profit & Loss for the year ended on that date.

Financial Results (Rs. lakhs)

Particulars 2012-13 2011-12

Total Income 1924.19 1908.99 Profit before Depreciation &

Interest for the year 146.44 (178.61)

Depreciation for the year 76.75 77.04

Finance Cost - 12.16

Deferred Tax Liability / (Asset) 22.85 (66.09)

Net Profit / (Loss) 46.84 (201.72)

Dividend

On account of accumulated losses your directors are unable to recommend dividend.

Fixed Deposits

The company has not accepted any fixed deposits and hence there are no unclaimed deposits as on 31.03.2013

Erosion of Net worth

As at 31st March 2013 your Company had a negative net worth of Rs. 91.66 lakhs. Your Directors believe that the Company''s net worth could be positive if the favorable business trends continue for few years. Therefore, the sickness status has not been referred to BIFR

Directors

Shri SSR Koteswara Rao, Director of the company retires by rotation and being eligible, offers himself for re-appointment.

Auditors

M/s S.Murali Dharan & Co, the Auditors of the company retire at the ensuing Annual General Meeting and have given their consent for re-appointment. The company has received confirmation from them that, if appointed, it would be within the limits of Section 224 (1B) of the Companies Act 1956. The Audit Committee and the Board of Directors of the Company proposed the re-appointment of the Auditors.

Cost Auditors

Pursuant to the provisions of Section 233B of the Companies Act, 1956, the Board of Directors of your company have re-appointed M/s S. Mahadevan & Co as Cost Auditors, subject to the approval of the Central Government for the financial year 2013-2014. The Company has filed the Cost Audit report for the financial year 2011 -2012 on 31.01.2013

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:

i) that in the preparation of the accounts for the financial year ended 31st March 2013, the applicable accounting standards have been followed.

ii) 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 earned by the company during the year under review.

iii) 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.

iv) that the Directors have prepared the accounts for the financial year ended 31st March 2013 on a going concern basis.

Human Resources

Employer-Employee relations remained cordial during the year under review. Information pursuant to Section 217(2A) of the Companies Act, 1956, is not furnished, as there were no employees covered by the said provisions.

Internal control systems and their adequacy

The Internal Auditor appointed conducts regular audit of the internal control systems and reports to the Audit Committee, which reviews the performance and adequacy of internal control systems on a quarterly basis and recommends improvements to the same, wherever found necessary.

Acknowledgement

Your Directors place on record the sincere appreciation of the contribution made by the employees of the Company at all levels. Your Directors further wish to place on record their appreciation for the invaluable support given by various authorities to the Company.

On behalf of the Board

Sumanth Ramamurthi

Managing Director

Coimbatore Dr I Venkat Rao

25th May, 2013 Director


Mar 31, 2012

The Directors present their 30th Annual Report of the Company for the financial year 2011-12 together with the Balance Sheet as at 31st March 2012 and the Profit & Loss Account for the year ended on that date.

Financial Results (Rs.in Lakhs)

Particulars 2011-12 2010-11

Total Income 1908.99 2521.71

Profit before Depreciation & (178.47) 283.07 Interest for the year

Depreciation for the year 77.04 78.84

Interest & Bank charges 12.30 36.38

Deferred Tax Liability / (Asset) (66.09) 45.34

Net Profit / (Loss) (201.72) 122.51

Performance

Your Company has earned total income of Rs.1908.99 Lakhs and suffered loss of Rs.201.72 Lakhs due to fluctuation in cotton and yarn price, as compared to the turnover of Rs.2521.71 Lakhs and profit of Rs. 122.51 Lakhs during the preceding year.

The last quarter of 2011-12 has been encouraging and the Company has achieved the profit during the said quarter due to stability in price of cotton yarn. Your Directors expect to continue the same in the coming year given the favourable market conditions.

Dividend

On account of accumulated losses your Directors are unable to recommend dividend.

Fixed Deposits

The Company has not accepted any fixed deposits and hence there are no unclaimed deposits as on 31.03.2012.

Erosion of Networth

As on 31st March 2012 your Company had a negative net worth of Rs. 138.50 lakhs. Your Directors believe that the Company's networth could be positive if the favourable business trend continues for few years. Therefore, the sickness status has not been referred to BIFR.

Directors

Sri CSK Prabhu, Director of the Company retires by rotation and being eligible offers himself for re-appointment.

Auditors

M/s S.Murali Dharan & Co, the Auditors of the Company retire at the ensuing Annual General Meeting and have given their consent for reappointment.

Cost Auditors

Pursuant to the provisions of Section 233B of the Companies Act, 1956, the Board of Directors of your Company have re-appointed M/s S. Mahadevan & Co as Cost Auditors, subject to the approval of the Central Government for the financial year 2012-2013.

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:

i) That in the preparation of the accounts for the financial year ended 31st March 2012, the applicable accounting standards have been followed.

ii) That the Directors have 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 at the end of the financial year and of the loss suffered by the Company during the year under review.

iii) 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.

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

Human Resources

Employer-Employee relations remained cordial during the year under review. Information pursuant to Section 217(2A) of the Companies Act, 1956, is not furnished, as there were no employees covered by the said provisions.

Internal control systems and their adequacy

The Internal Auditor appointed, conducts regular audit of the. internal control systems and reports to the Audit Committee, which reviews the performance and adequacy of internal control systems on a quarterly basis and recommends improvements to the same, wherever found necessary.

Acknowledgement

Your Directors place on record the sincere appreciation of the contribution made by the employees of the Company at all levels. Your Directors further wish to place on record their appreciation for the invaluable support given by various authorities to the Company.

On behalf of the Board

Sumanth Ramamurthi

Managing Director

Coimbatore Dr I Venkat Rao

24th May, 2012 Director


Mar 31, 2011

The Directors present their 29th Annual Report of the company for the financial year 2010-11 together with the Balance Sheet as at 31st March 2011 and the Profit & Loss Account for the year ended on that date.

Financial Results (Rs. in Lakhs)

Particulars 2010-111 2009-10

Total Income 2521.71 1969.94

Profit before Depreciation &

Interest for the year 283.07 405.54

Depreciation for the

year 78.84 78.42

Interest & Finance

charges 36.38 60.37

Depreciation for

earlier years - 256.72

Deferred Tax Liability 45.34 -

Deferred Tax Asset - 323.39

Net Profit/(Loss) 122.51 333.42

Performance

Your Company has earned a total income of Rs.2521.71 Lacs and profit of Rs.122.51 Lacs, as compared to the turnover of Rs. 1969.94 Lacs and profit of Rs. 333.42 Lacs during the preceding year.

Turnover in the current year is comparably higher than the previous year. But the high prices of raw materials resulted in less profit when compared to previous year. Your Directors are confident that the future year will be a good profitable year to the company.

Dividend

On account of previous years accumulated losses your directors are unable to recommend any dividend.

Fixed Deposits

The Company has not accepted any fixed deposits and hence there are no unclaimed deposits as on 31.03.2011.

Erosion of Networth

As on 31st March 2011 your Company had a netwbrth of Rs. 63.22 lakhs. Your Directors believe that the company will come out from the clutches of provisions of Sick Industrial Company if the positive business trend continues for few years. Therefore, the sickness status has not been referred to BIFR.

Directors

Dr. I. Venkat Rao, Director of the company retires by rotation and being eligible offers himself for re-appointment. Mr. Sumanth Ramamurthi has been re-appointed as Managing Director of the company with effect from 30.05.2011 for a term of three years.

Auditors

M/s S.Murali Dharan & Co, the Auditors of the company retire at the ensuing Annual General Meeting and have given their consent for reappointment.

Cost Auditors

Pursuant to the provisions of the Section 233B of the Companies Act, 1956, the Board of Directors of your company have re-appointed M/s S. Mahadevan & Co, as Cost Auditors, subject to the approval of the Central Government for the financial year 2011 -2012.

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:

i) That in the preparation of the accounts for the financial year ended 31st March 2011, the applicable accounting standards have been followed.

ii) 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 earned by the company during the year under review.

iii) 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.

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

Human Resources

Employer-Employee relations remained cordial during the year under review. As regards, information pursuant to Section 217(2A) of the Companies Act, 1956, there are no employees covered by the said provisions.

Internal control systems and their adequacy

The Internal Auditor appointed conducts regular audit of the internal control systems and reports. to the Audit Committee, which periodically reviews the performance and adequacy of internal control systems on quarterly basis and recommends improvements to the same, wherever found necessary.

Acknowledgement

Your Directors place on record the sincere appreciation of the contribution made by the employees of the Company at all levels. Your Directors further wish to place on record their appreciation for the invaluable support given by all other authorities to the Company.

On behalf of the Board

Sumanth Ramamurthi

Managing Director

Coimbatore Dr I Venkat Rao

28th May, 2011 Director


Mar 31, 2010

The Directors present their 28th Annual Report of the company for the financial year 2009-10 together with the Balance Sheet as at 31st March 2010 and the Profit & Loss Account for the year

ended on that date.

Financial Results (Rs.in Lacs)

Particulars 2009-10 2008-09

Total Income 1969.94 864.25

Profit before Despreciation & Interest for the year 405.54 173.16

Depreciation 78.42 174.99

Interest & Finance Charges 60.37 89.76

Fringe Benefit Tax - 0.31

Depreciation for

earlier years 256.72

Deferred Tax (323.39)

Net Profit / (Loss) 333.42 (91.90)

Dividend

Dividend could not be recommended for the finan cial year 2009-10 in view of brought forward loss.

Fixed Deposits

The Company has not accepted/invited fixed deposits during the year under review.

Performance

Your Company has earned a total income of Rs. 1969.90 Lacs and a profit of Rs.333.42 Lacs, as compared to the turnover of Rs.864.25 Lacs and loss of Rs.91.90 Lacs during the preceding year.

Depreciation for the past years

Accumulated Depreciation on fixed assets for the period 01.04.2001 to 31.03.2006 aggregating to Rs.256.72 Lacs has been provided during the year under review.

Directors

Shri. Koteswara Rao SSR, Director of the company retires by rotation and being eligible offers himself for re-appointment.

Auditors

M/s S. Murali Dharan & Co, the Auditors of the company retire at the ensuing Annual General Meeting and have given their consent for reappointment.

Cost Auditors

Pursuant to the provisions of the Section 233B of the Companies Act, 1956, the Board of Directors of your company have re-appointed M/s S. Mahadevan & Co as Cost Auditors, subject to the approval of the Central Government for the financial year ended March 31s, 2010.

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:

i) That in the preparation of the accounts for the financial year ended 31st March 2010, the applicable accounting standards have been followed along with proper explanation relating to material departures; if any.

ii) That the Directors have 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 at the end of the financial year.

iii) 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.

iv) That the Directors have prepared the accounts for the financial year ended 31st March 2010 on a going concern basis. Human Resources Employer-Employee relations remained cordial during the year under review. As regards, information pursuant to Section 217(2A) of the Companies Act, 1956, there are no employees covered by the said provisions. Internal control systems and their adequacy The company has adequate internal control systems. The Management as well as Statutory auditors take the periodical reports of officer(s) in charge of internal control system into account. The adequacy of the internal control systems is reviewed by the Audit Committee at periodical intervals. Acknowledgement

Your Directors place on record the sincere appreciation of the contribution made by the employees of the Company at all levels. Your Directors further wish to place on record their appreciation for the invaluable support given by all other authorities to the Company.

On behalf of the Board Sumanth Ramamurthi

Dr I Venkat Rao

Managing Director Director

Coimbatore 21st May, 2010

 
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