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Directors Report of Nagarjuna Oil Refinery Ltd.

Mar 31, 2015

Dear Members,

The Directors have pleasure in presenting before you the 5th Annual Report of the Company together with the Audited Statements of Accounts for the year ended March 31, 2015.

The Financial Results of the Company for the year ended March 31, 2015 are as under :

A. BUSINESS AND FINANCIAL HIGHLIGHTS

Standalone Financial Results: Rs In Lakhs

Particulars 2014 - 2015 2013 - 2014 Current Year Previous Year

Net Sales/Income from Operations - -

Other Income 3.30 -

Total Expenditure

a. Increase/(decrease) in Stock - -

b. Cost of materials consumed - -

c. Employee benefits expense 73.71 75.86

d. Purchase of traded products - -

e. Power and fuel - -

f. Other expenses 484.33 95.03

Total 558.04 170.89

Finance cost 7.95 -

Depreciation and amortization 2.12 4.03

Exceptional Items 40,000.00 -

Profit before tax (40,564.81) (174.92)

Profit after tax (40,564.81) (174.92)

Balance c/d to balance sheet (40,564.81) (174.92)

Paid Up equity share capital (Face value of Rs.1/- per share) 4281.82 4281.82

Reserves excluding revaluation reserve 32,510.97 73,075.83

Earning per share (annualized) - in Rs. Basic and Diluted (9.47) (0.04)

Financial Summary

The Loss after tax for the year was Rs.40,564.81 Lakhs against loss after tax of Rs.174.92 Lakhs for the previous year.

The main contributors to the loss was on exceptional item representing a provision of Rs. 40,000 lakhs towards diminution in the value of investment in Nagarjuna Oil Corporation Limited (NOCL), considering the delay in induction of partner and consequently, achieving financial closure for re-assessed cost of project.

Status of the Oil Refinery Project

Your Company holds 46.78% of equity share capital in Nagarjuna Oil Corporation Limited (NOCL) which is involved in setting-up a 6 MMTPA refinery project at Cuddalore, Tamil Nadu.

The implementation of the Project was impacted by cyclone 'Thane'. The physical completion of the Project as on date is 58%.

NOCL is actively pursuing with strategic investors to participate in equity investment in view of escalation in the project cost. The due diligence by some of the Investors has been completed and the Company is awaiting their decision.

In view of the escalation in project cost, NOCL is making all efforts to achieve financial closure at the earliest.

Share Capital

The paid-up equity capital of the Company as on March 31, 2015 is Rs.42,81,81,821/- consisting of 42,81,81,821 equity shares of Rs.1/- each.

Subsidiaries, Joint Ventures or Associate Companies:

Nagarjuna Oil Corporation Limited (NOCL) an associate of the Company, is setting up a petroleum refinery project at Cuddalore, Tamil Nadu.

The Ministry of Corporate Affairs, Government of India has granted exemption for the consolidation of financial statement in respect of associate companies which does not have a subsidiary or subsidiaries. Accordingly, Financial Statements of the Associate Company is not attached to the Annual Accounts of the Company.

A statement containing salient features of the Financial Statement of Associate Company appears as Annexure-I to this Report

B. DIRECTORS, BOARD COMMITTEES, KEY MANAGERIAL PERSONNEL AND REMUNERATION

Directors Retiring by Rotation

In accordance with Section 152 of the Companies Act, 2013 and the Articles of Association of the Company, Mr. Chandra Pal Singh Yadav who is liable to retire by rotation and being eligible, offers himself for re-appointment as Director of the Company, subject to retirement by rotation.

Independent Director

In accordance with Section 149, 152 and Schedule IV read with relevant Rules of the Companies Act, 2013, Ms. Lalitha Raghuram is proposed to be appointed as Independent Director of the Company not liable to retire by rotation upto the conclusion of the 10th Annual General Meeting pursuant to the provisions of Section 149 of the Companies Act, 2013 and the Listing Agreement.

Declaration by Independent Directors

The Independent Directors have submitted their disclosure to the Board that they fulfill all the requirements as to qualify as an Independent Director under Section 149(6) of the Companies Act, 2013, as well as Clause 49 of the Listing Agreement

Key Managerial Personnel:

Company Secretary

The Board has appointed Ms. Ankita Mathur as the Company Secretary of the Company with effect from March 5, 2015 in place of Mr. T Vamsi Krishna who has separated from the service of the Company.

There are no other changes in relation to other Key Managerial Personnel.

Meetings of the Board

The Board of Directors of your Company, during the period under review met five times on May 29, 2014, July 30, 2014, October 18, 2014, November 10, 2014 and February 13, 2015.

Remuneration and other particulars of the Directors/Key Managerial Personnel/Employees

The information relating to remuneration and other particulars of the Directors/Key Managerial Personnel/Employees as required under Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 appears as Annexure - II.

Personnel

In terms of the provisions of Section 197(12) of the Companies Act, 2013 read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, a statement showing the names and other particulars of the employees drawing remuneration in excess of the limits set out in the said rules appears as Annexure - III.

Committees:

Audit Committee

In compliance with the provisions of Section 177 of the Companies Act, 2013 and the Listing Agreement entered into with the Stock Exchanges, the Company had constituted an Audit Committee consisting of qualified and experienced members from various fields. The Committee consists of three independent Directors and one non- executive Director. The Chairman of the Committee is Dr. N C B Nath, an Independent Director. The Committee meets periodically to review the internal audit report and quarterly financial statements and recommends its decisions to the Board apart from taking action independently whenever required. The Statutory Auditors and Secretary attend the Audit Committee Meetings.

The Audit Committee comprises of

Dr. N C B Nath : Chairman - Independent Director

Mr. S R Ramakrishnan : Member - Independent Director

Ms. Lalitha Raghuram : Member - Independent Director

Mr. K S Raju : Member

Nomination and Remuneration Committee

The Nomination and Remuneration Committee was constituted in compliance with the provisions of the Companies Act, 2013 and revised Clause 49 of the Listing Agreement

The Company has also adopted a Nomination and Remuneration Policy for determining, inter-alia, qualifications, positive attributes and independence of a Director, matters relating to the remuneration, appointment, removal and evaluation of performance of the Directors, Key Managerial Personnel, Senior Management and other employees.

Stakeholders Relationship Committee

The Stakeholders Relationship Committee was constituted in compliance with the provisions of Companies Act, 2013 and Clause 49 of the Listing Agreement

C. DISCLOSURES

Company Policy Matters

Your Company's endeavor has always been to maintain transparency and accountability to its stakeholders. In this direction, various policies mentioned in the Corporate Governance Report have been implemented to enable the stakeholders to appreciate the various interventions the Company has taken.

The implementation of these policies are reviewed periodically by the Board of Directors and updated regularly.

The Company has during the year drawn-up a Nomination and Remuneration Policy and Board Evaluation Policy and made it effective from November 10, 2014.

Risk Management Policy

The Board has put in place the Risk Management Policy for the Company to address various risks impacting the Company.

The Company has setup an Enterprise Risk Management System to manage and mitigate risks.

Policy on Board Evaluation

The Policy on Board Evaluation was adopted with effect from Nobember 10, 2014, by the Board of Directors in compliance of Companies Act, 2013 and Clause 49 of the Listing Agreement entered into with the Stock Exchanges.

The purpose of the policy is to assess the effectiveness of the Board as a whole, Committees of the Board and Individual Directors (Independent and Non-Independent) on regular basis and to take necessary steps for improving the effectiveness of the Board.

The Nomination and Remuneration Committee has devised the methodology, identified sample tools for evaluation and also laid down the parameters for evaluation of Non-Executive Directors, Independent Directors, Chairman, Committees of the Board and the Board.

The Nomination and Remuneration Committee, have based on the responses received from Directors, evaluated the Directors, conveyed the opinion of the Committee to the Directors, Committees and the Board.

In view of the evaluation not linked to payment of remuneration, as the Company has opted only for payment of sitting fees, the evaluation has no financial implications on the Company.

Whistle Blower Policy

The Company formulated a policy to prohibit managerial personnel from taking adverse personnel action against employees disclosing in good faith, alleged wrongful conduct on matters of public concern involving violation of any law, mismanagement, misappropriation of public funds, among others.

Employees aware of any alleged wrongful conduct are encouraged to make a disclosure to the Audit Committee.

No personnel of the Company were denied access to the Audit Committee.

Corporate Social Responsibilty

The provisions relating to Corporate Social Responsibility does not apply to the Company.

Corporate Governance

Your Company firmly believes that building a culture of compliance is more than meeting regulations and standards. Your Company is always proactive in meeting mandated standards and practicing Corporate Governance in spirit and not just the letter of the law.

As Mandated by Clause 49 of the Listing Agreement a report on Corporate Governance alongwith a Certificate from Practicing Company Secretary on the compliance of conditions of Corporate Governance is annexed hereto. Your Company is happy to inform you that there were no adverse remarks/qualifications/reservations raised in the Corporate Governance Report.

Related Party Transactions

There are no contracts or arrangements entered into by the Company with related parties in accordance with the provisions of Section 188(1) of the Companies Act, 2013, other than the transaction entered into with Nagarjuna Fertilizers and Chemicals Limited pursuant to the Order of the jurisdictional High Courts in relation to the Composite Scheme of Arrangement and Amalgamation between ikisan Limited, Kakinada Fertilizers Limited, Nagarjuna Fertilizers and Chemicals Limited and Nagarjuna Oil Refinery Limited.

Particulars of Loans, Guarantees or Investments

The Company has not provided any loans, guarantees or made investments pursuant to Section 186 of the Companies Act, 2013 other than executing a Sponsored Undertaking in favor of the lenders of Nagarjuna Oil Corporation Limited.

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

In relation to the information required to be furnished under the Companies Act, 2013 read with Companies (Accounts) Rules, 2014, the Company is not undertaking any manufacturing activity and accordingly there is no information available pertaining to

Conservation of Energy and Technology Absorption. There is no Foreign Exchange Earnings and Outgo.

Extract of Annual Return

The Extract of the Annual Return for the year ended March 31, 2015 appear as Annexure- IV to this report

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

There were no orders passed by Regulators or Courts or Tribunals impacting the going concern status and future business operations of the Company.

Adequacy of Internal Financial Controls

The Company has established and is maintaining internal controls and procedures.

The Board of Directors have evaluated the effectiveness of the Company's internal controls and procedures and confirm that they are adequate based on the size and the nature of its business.

Deposits

The Company has not accepted any deposits within the purview of the Companies Act, 2013 and the Rules made thereunder during the financial year 2014-15.

D. AUDITORS AND AUDIT REPORT Statutory Auditors

M/s. M Bhaskara Rao & Co., Chartered Accountants, Hyderabad, were appointed as the Statutory Auditors' for a term of five (5) years commencing from the conclusion of the 4th Annual General Meeting up to the conclusion of the 9th Annual General Meeting subject to ratification by the members of the Company every year at the Annual General Meeting.

M/s. M Bhaskara Rao & Co have signified their willingness to accept ratification of appointment and have further confirmed their eligibility under Section 141 of the Companies Act, 2013.

The Company's Statutory Auditors have also furnished a certificate from the Peer Review Board of the ICAI confirming that they have undergone the process of peer review.

The Board of Directors in accordance with the provisions of Section 139 of the Companies Act, 2013 and Rules made thereunder commend the ratification of the appointment of Statutory Auditors for the Financial year 2015-16 for consideration of the members.

Statutory Audit Report

There are no adverse comments in the report of the Statutory Auditors' of the Company.

Secretarial Auditor

The Board of Directors at their meeting held on May 16, 2015 pursuant to the provisions of Section 203 of the Companies Act, 2013 have appointed Mr. C S S Krishna, Partner, M/s KBG Associates, Company Secretaries, Hyderabad as the Secretarial Auditor of the Company to undertake Secretarial Audit for the Financial Year 2015-16.

Secretarial Audit Report

Pursuant to Section 204 of the Companies Act, 2013, the Secretarial Audit Report for the Financial Year 2014-15 appears as Annexure - V to this Report. There are no qualifications or adverse remarks in the report.

Internal Audit

The Company has a well established system of Internal Audit which carries out audit on Risk Management framework covering all the functions.

An Internal Auditor of the Company has been appointed by the Board of Directors, in compliance of the Companies Act, 2013 and Clause 49 of the Listing Agreement.

E. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134 (3)(c) and Section 134(5) of the Companies Act, 2013, the Board of Directors of the Company hereby report:

(a) in the preparation of the annual accounts, the applicable Accounting Standards had been followed along with proper explanation relating to material departures;

(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 profit and 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; and

(e) the Directors, in the case of a listed Company, had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively.

(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.

ACKNOWLEDGEMENT

Your Directors place on record their gratitude to the Government of India and the financial institutions and Company's bankers for their assistance and cooperation.

Further, the Company places on record its sincere appreciation for the continuing support and unstinting efforts of investors and all stakeholders.

By Order of the Board

Hyderabad K S Raju July 23, 2015 Chairman


Mar 31, 2014

Dear Members,

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

FINANCIAL SUMMARY Rs.in Lakhs

Particulars 2013 - 2014 2012-2013 current year previous year

Net Sales/Income from Operations - -

Other Income - -

Total Expenditure

a. Increase/(decrease) in Stock - -

b. Cost of materials consumed - -

c. Employee benefits expense 75.86 70.17

d. Purchase of traded products - -

e. Power and fuel - -

f. Other expenses 95.03 83.16

Total 170.89 153.33

Finance cost - -

Depreciation and amortization 4.03 4.82

Profit before tax (174.92) (158.15)

Provision for tax - -

Deferred tax - -

Profit after tax (174.92) (158.15)

Dividend - equity shares - -

Tax on proposed dividend - -

Balance c/d to balance sheet (174.92) (158.15)

Paid Up equity share capital

(Face value of Re.1/- per share) 4281.82 4281.82

Reserves excluding revaluation reserve 73,075.83 73,250.75

Earning per share (annualized) - in Rs.

Basic and Diluted (0.04) (0.04)

STATUS OF THE OIL REFINERY PROJECT

The company as on date holds 46.78% of Equity Capital in Nagarjuna Oil Corporation Limited (NOCl). NOCL is setting-up 6MMTPA refinery project at Cuddalore, Tamil Nadu.

The implementation of the Project was impacted by cyclone ''Thane''. The physical completion of the Project as on date is 58%.

NOCL is actively pursuing with Strategic Investors to participate in equity investment in view of escalation in the Project Cost and the due diligence by some of the Investors has completed and awaiting their decision.

In view of the escalation in project cost, NOCL is making all efforts to achieve financial closure at the earliest.

CORE INVESTMENT COMPANY

The company has made application to Reserve Bank of India for registration as ''Core Investment Company'' to comply with Core Investment Companies (Reserve Bank) Directions, 2011.

SHARE CAPITAL

The paid-up equity capital of the company as on March 31, 2014 is Rs. 42,81,81,821/ - consisting of 42,81,81,821 equity shares of Rs. 1/- each.

CORPORATE GOVERNANCE

The company firmly believes that building a culture of compliance is more than meeting regulations and standards. Your company is always proactive in meeting mandated standards and practicing corporate governance in spirit and not just the letter of the law.

As Mandated by Clause 49 of the Listing Agreement a report on Corporate Governance alongwith a Certificate from Practicing Company Secretary on the compliance of conditions of Corporate Governance is annexed hereto. Your company is happy to inform you that there were no adverse remarks / qualifications/ reservations raised in the Corporate Governance Report.

NUMBER OF BOARD MEETINGS

The Board of Directors of your company, during the period under review met Four times on May 03, 2013, August 08, 2013, November 07, 2013 and February 06, 2014.

DIRECTORS

Nominee Director

Mr Chandra Pal Singh Yadav, Vice Chairman of Krishak Bharati Cooperative Limited (KRIBHCO) was appointed as Nominee Director of KRIBHCO on the Board of the company with effect from April 15, 2014.

Mr N Sambasiva Rao, Managing Director of KRIBHCO was appointed as Alternate Director to Shri Chandra Pal Singh Yadav with effect from May 29, 2014

Independent Directors

In accordance with Section 149, 152 and Schedule IV read with relevant Rules of the Companies Act, 2013 and the revised Clause 49 of the Listing Agreement it is proposed to appoint Dr NCB Nath, Shri S R Ramakrishnan and Shri D Ranga Raju as Independent Directors of the company not liable to retire by rotation up to the conclusion of 9th Annual General Meeting or September 25, 2019, whichever is later.

The appointments are being placed before the members of the company at the 4th Annual General Meeting to be held on September 26, 2014 for their approval.

Retiring by Rotation

In accordance with Section 152 of the Companies Act, 2013 and the Articles of Association of the Company, Mr K S Raju and Mr K Rahul Raju, who are liable to retire by rotation being eligible, offer themselves for re-appointment as Directors of the Company, subject to retirement by rotation.

Key Managerial Personnel:

Manager:

The Board has re-appointed Mr K Soma Raju as Manager of the company for a period of three years with effect from August 31, 2014, subject to the approval of members of the Company.

There are no other changes in relation to other Key Managerial Personnel.

DECLARATION BY INDEPENDENT DIRECTORS

The Independent directors have submitted their disclosure to the Board that they fulfill all the requirements as to qualify for their appointment as an Independent Director under section 149(6) of the Companies Act, 2013 as well as revised Clause 49 of the Listing Agreement.

AUDITORS AND AUDIT REPORT

M/s. M Bhaskara Rao & Co., Chartered Accountants, Hyderabad, the company''s auditors retire at the conclusion of the ensuing Annual General Meeting. They have signified their willingness to accept re-appointment and have further confirmed their eligibility under Section 141 of the Companies Act, 2013.

The company''s Statutory Auditors have also furnished a certificate from the Peer Review Board of the ICAI confirming that they have undergone the process of peer review.

The Board of Directors in accordance with the provisions of Section 139 of the Companies Act, 2013 and rules made thereunder recommends their appointment for a term of five years from the conclusion of 4th Annual General Meeting to the conclusion of 9th Annual General Meeting subject to ratification every year at the Annual General Meeting for consideration of the shareholders.

VIGIL MECHANISM

The Company already has put in place a policy to prohibit managerial personnel from taking adverse personnel action against employees disclosing in good faith, alleged wrongful conduct on matters of public concern involving violation of any law, mismanagement, misappropriation of public funds, among others.

Employees aware of any alleged wrongful conduct are encouraged to make a disclosure to the Audit Committee.

No personnel of the company was denied access to the Audit Committee.

SECRETARIAL AUDITOR

The Board of Directors at their meeting held on May 29, 2014 pursuant to the provisions of Section 203 of the Companies Act, 2013 has appointed Mr CSS Krishna, Practicing Company Secretary as the Secretarial Auditor of the Company to undertake the Secretarial Audit for the financial year 2014-15.

PERSONNEL

There are no employees as on date on the rolls of the Company who are in receipt of remuneration which requires disclosures under provisions of Section 217(2A) of the Companies Act, 1956.

DISCLOSURES

There are no disclosures in terms of Companies (Disclouser of Particulars in the Report of the Board of Directors) Rules, 1988 in respect of conservation of energy, technology absorption, earnings and outgo of foreign exchange.

AUDIT COMMITTEE CONSTITUTION

In compliance with the provisions of the Section 177 of the Companies Act, 2013 and the listing agreement entered into with the stock exchanges, the company had constituted an Audit Committee consisting of highly qualified and experienced members from various fields. The committee consists of two independent Directors and one non-executive Director. The Chairman of the committee Dr. N C B Nath, is an Independent Director and the committee meets periodically to review the quarterly financial statements and recommends its findings to the Board apart from taking action independently whenever required. The Statutory Auditors and Secretary attend and participate in the Audit Committee Meetings.

The Audit Committee comprises of

Dr. N C B Nath : Chairman, Independent Director

Shri S R Ramakrishnan : Member & Independent Director

Shri K S Raju : Member

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Companies Act, 2013.

The Directors hereby report:

(a) that in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

(b) that the directors had selected such accounting policies and applied them consistently and made judgments and estimates that 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 and loss of the company for that period;

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

(e) that the directors, had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.

(f) that 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.

ACKNOWLEDGEMENT

Your Directors place on record their gratitude to the Government of India, Government of Andhra Pradesh, Government of Telangana and the financial institutions and company''s bankers for their assistance and cooperation.

Further, the company places on record its sincere appreciation for the continuing support and unstinting efforts of investors, associates and all stakeholders in ensuring an excellent all round operational performance.

On behalf of the Board

Hyderabad K S Raju July 30, 2014 Chairman


Mar 31, 2013

The Directors have pleasure in presenting the Third Annual Report together with the Audited Accounts of the Company for the year ended March 31, 2013 Status of the Oil Refinery Project

Your company as on date holds 46.78% of Equity Capital in Nagarjuna Oii Corporation Limited (NOCL). NOCL is setting-up 6MMTPA refinery project at Cuddalore, Tamil Nadu.

The implementation of the Project was impacted by cyclone ''Thane''. The physical completion of the Project as on date is 58%.

NOCL is actively pursuing with Strategic Investors to participate in equity investment in view of escalation in the Project Cost and the due diligence by some of the Investors in under progress.

In view of the escalation in project cost, NOCL is making all efforts to achieve financial closure at the earliest.

Core Investment Company

Your company has made application to Reserve Bank of India for registration as ''Core Investment Company1 to comply with Core Investment Companies (Reserve Bank) Directions, 2011.

Postal Ballot

Your company, in terms of approval of the shareholders under section 192A of the Companies Act, 1956 read with Companies (passing of the resolution by postal ballot) rules, 2001 had sought the approval for subscribing to shares, making loans, providing guarantee in form of Sponsor Undertaking to the Lenders of Nagarjuna Oil Corporation Limited (NOCL).

The Postal Ballot results indicated that special resolution was passed with requisite majority and the results were declared by the Chairman Shri K S Raju on August 22, 2012.

CORPORATE GOVERNANCE

Your company firmly believes that building a culture of compliance is more than meeting regulations and standards. Your company is always proactive in meeting mandated standards and practicing corporate governance in spirit and not just the letter of the law.

As Mandated by Clause 49 of the Listing Agreement a report on Corporate Governance alongwith a Certificate from Practicing Company Secretary on the compliance of conditions of Corporate Governance is annexed hereto. Your company is happy to inform you that there were no adverse remarks / qualifications/ reservations raised in the Corporate Governance Report.

DIRECTORS

In accordance with the Companies Act, 1956 and the Articles of Association of the Company, Dr. N C B Nath and Shri S R Ramakrishnan, who are liable to retire by rotation being eligible, offer themselves for re-appointment as Directors of the Company, subject to retirement by rotation.

AUDITORS

M/s. M. Bhaskara Rao & Co., Chartered Accountants, Hyderabad, the Statutory Auditors of the Company retires at the conclusion of the ensuing Annual General Meeting. They have signified their willingness to accept re-appointment vide letter dated April 18, 2013, and have further confirmed their eligibility under section 224(1 B) of the Companies Act, 1956.

The Company''s Statutory Auditors have also furnished us a certificate dated May 25, 2012 from the Peer Review Board of the ICAI confirming that they have undergone the process of peer review.

PERSONNEL

There are no employees as on date on the rolls of the Company who are in receipt of remuneration which requires disclosures under Sec 217 (2A) of Companies Act, 1956 and Companies (Particulars of Employees) Rules, 1975.

DISCLOSURES

Disclosure in terms of Companies (Disclosure of particulars in the Report of the Board of Directors) Rules, 1988 in respect of conservation of energy, technology absorption, earnings and outgo of foreign exchange are not applicable.

AUDIT COMMITTEE CONSTITUTION

In compliance with the provisions of the Section 292A of the Companies Act, 1956 and the listing agreement entered into with the stock exchanges, the company had constituted an Audit Committee consisting of highly qualified and experienced members from various fields. The committee consists of two independent Directors and one non-executive Director. The Chairman of the committee Dr. N C B Nath, is an Independent Director and the committee meets periodically to review the quarterly financial statements and recommends its findings to the Board apart from taking action independently whenever required. The Statutory Auditors and Secretary attend and participate in the Audit Committee Meetings.

The Audit Committee comprises of

Dr. N C B Nath : Chairman & Independent Director

Shri S R Ramakrishnan : Member & Independent Director

Shri K S Raju : Member

DIRECTORS RESPONSIBILITY STATEMENT

Your Directors wish to state the following, with regard to the preparation of Annual

Accounts for the year ended March 31, 2013

1. That in preparation of Annual Accounts, the applicable and relevant Accounting Standards have been followed and there have been no major or material departure from the standards.

2. That 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 financial year and Statement of Profit and Loss of the* company for the year under review.

3. That proper and sufficient care has been taken 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 frauds and other irregularities.

4. That the Annual Accounts have been prepared on a ''going concern'' basis.



By Order of Board

May 03, 2013 K.S. Raju

Hyderabad Chairman


Mar 31, 2012

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

RESTRUCTURING

The Composite Scheme of Arrangement and Amalgamation between Kakinada Fertilizers Limited (KFL), iKisan Limited (iKisan), Nagarjuna Fertilizers and Chemicals Limited (NFCL) and Nagarjuna Oil Refinery Limited (NORL) (Scheme) was approved by the Hon'ble High Court of Bombay at Mumbai on June 17, 2011 and by the Hon'ble High Court of Andhra Pradesh at Hyderabad on June 27, 2011. Consequent to the approval of the Jurisdictional High Courts, the Composite Scheme was made Effective on July 30, 2011 i.e., Effective Date but operative from Appointed Date i.e., April 1, 2011. The 'Oil Business Undertaking' of Erstwhile NFCL was demerged into your company with effect from July 30, 2011 and the residual NFCL along with iKisan were merged into KFL.

Your company had filed applications for listing of its equity shares with Bombay Stock Exchange (BSE) and National Stock Exchange (NSE) on October 7, 2011. BSE approved application of the company for listing of 42,81,81,821 equity shares on December 8, 2011 and NSE provided in-principle approval for listing of 42,81,81,821 equity shares on January 13, 2012.

SEBI vide letter dated February 29, 2012 granted relaxation under Rule 19(2)(b) of Securities Contracts (Regulation) Rules, 1957. The trading in the equity shares of the Company had commenced from March 28, 2012.

All the assets and liabilities of Oil Business Undertaking were transferred to and vested in your company with effect from the Appointed Date, and recorded at their respective book values.

Your company has drawn up the financial statements for the year 2011-2012 as per the revised Schedule VI of the Companies Act, 1956 which provides for a new presentation of the information compared to the earlier format.

Core Investment Company

Your company has made application to Reserve Bank of India for registration as 'Core Investment Company' to comply with Core Investment Companies (Reserve Bank) Directions, 2011.

CORPORATE GOVERNANCE

Your company firmly believes that building a culture of compliance is more than meeting regulations and standards. Your company is always proactive in meeting mandated standards and practicing corporate governance in spirit and not just the letter of the law.

A report on Corporate Governance along with the Practicing Company Secretary's Certificate on its compliance is annexed hereto. Your company is happy to inform you that there were no adverse remarks / qualifications/ reservations raised in the Corporate Governance Report.

DIRECTORS

In accordance with the Companies Act, 1956 and the Articles of Association of the Company, Shri K.S.Raju and Shri K Rahul Raju being eligible, offer themselves for re-appointment as Directors of the Company, subject to retirement by rotation. Shri D Ranga Raju who was appointed as Additional Director of the Company and who holds office up to the conclusion of this Annual General Meeting, and being eligible, offer himself for appointment as Director of the Company, subject to retirement by rotation.

AUDITORS

M/s. M. Bhaskara Rao & Co., Chartered Accountants, Hyderabad, the Statutory Auditors of the Company retires at the conclusion of the ensuing Annual General Meeting. They have signified their willingness to accept re-appointment vide letter dated March 16, 2012, and have further confirmed their eligibility under Section 224(1B) of the Companies Act, 1956.

The Company's Statutory Auditors have also furnished us a certificate dated May 25, 2012 from the Peer Review Board of the ICAI confirming that they have undergone the process of peer review.

Share Capital

During the year the following changes were effected to the equity share capital of the company:

- One equity share of Rs.10/- each was sub-divided into ten equity shares of Rs.1/- each

- Pursuant to the Composite Scheme 42,81,81,821 equity shares of Rs.1/- each were issued to the shareholders of Erstwhile nFcL

- The pre-scheme equity paid-up capital of Rs.5 Lakhs consisting of 5,00,000 equity shares of Rs.1/- each held by Promoters was cancelled.

The paid-up equity capital of the company as on March 31, 2012 is Rs. 42,81,81,821/- SUBSIDIARY COMPANIES

During the year upon making the Composite Scheme effective, Nagarjuna Oil Corporation Limited (NOCL) became a subsidiary of your company with effect from July 30, 2011.

NOCL ceased to be subsidiary of the company with effect from March 29, 2012, consequent to the shareholding of the company in NOCL being reduced to 46.78% of the total paid-up share capital of the company.

PERSONNEL

There are no employees as on date on the rolls of the Company who are in receipt of remuneration which requires disclosures under Sec 217 (2A) of Companies Act, 1956 and Companies (Particulars of Employees) Rules, 1975.

DISCLOSURES

Disclosure in terms of Companies (Disclosure of particulars in the Report of the Board of Directors) Rules, 1988 in respect of conservation of energy, technology absorption, earnings and outgo of foreign exchange are not applicable AUDIT COMMITTEE CONSTITUTION

In compliance with the provisions of the Section 292A of the Companies Act, 1956 and the listing agreement entered into with the stock exchanges, the Company had constituted an Audit Committee consisting of highly qualified and experienced members from various fields. The committee consists of two independent Directors and one non-executive Director. The Chairman of the committee Dr. N C B Nath, is an Independent Director and the committee meets periodically to review the quarterly financial statements and recommends its findings to the Board apart from taking action independently whenever required. The Statutory Auditors and Secretary attend and participate in the Audit Committee Meetings.

The Audit Committee comprises of

Dr. N C B Nath : Chairman & Independent Director

Shri S R Ramakrishnan : Member & Independent Director

Shri K S Raju : Member

DIRECTORS RESPONSIBILITY STATEMENT

Your Directors wish to state the following, with regard to the preparation of Annual Accounts for the year ended March 31, 2012

1. That in preparation of Annual Accounts, the applicable and relevant Accounting Standards have been followed and there have been no major or material departure from the standards.

2. That 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 financial year and of Statement of Profit and Loss of the Company for the year under review.

3. That proper and sufficient care has been taken 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 frauds and other irregularities.

4. That the Annual Accounts have been prepared on a 'going concern' basis.

By Order of Board

June 20, 2012 K.S. Raju

Hyderabad Chairman


Mar 31, 2011

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

ACTIVITIES OF THE COMPANY

Your Company was established to carry the business of extraction of Oil from various commodities by mechanical, electrical and/or chemical means.

Your company has taken various initiatives like identifying possible locations for setting-up a Plant and marketing of the Oil Business.

RESTRUCTURING

Your Directors in order to achieve market Leadership position, expand the Oil Business and give focused attention to the respective businesses, consider it advantageous to implement a Composite Scheme of Arrangement and Amalgamation (Scheme) of the company subject to the company obtaining requisite approvals of the shareholders, banks, Financial institutions and jurisdictional High Courts.

The Scheme envisages the Merger of Like business and demerger of unlike business resulting in synergies in businesses, inorganic growth and capturing the untapped market share by enhancing the product portfolio, service offerings, customer base, market positioning apart from attracting fresh investment in the respective sectors.

The Company has filed a Petition with the Hon'ble High Court of Andhra Pradesh for a Composite Scheme of Arrangement and Amalgamation between Kakinada Fertilizers Limited and iKisan Limited and Nagarjuna Fertilizers and Chemicals

Limited and Nagarjuna Oil Refinery Limited and their respective shareholders and creditors

Pursuant to the approval of the Scheme by the Court, the Oil Business undertaking of NFCL would be merged into the Company and the shares of the company will list on Bombay Stock Exchange and National Stock Exchange.

DIRECTORS

In accordance with the Companies Act, 1956 and the Articles of Association of the Company, Shri K.S.Raju, Shri. K.Rahul Raju, and Shri K Soma Raju, who were named as First Directors under Article 112 of the Articles of Association of the Company and who holds office up to the conclusion of this Annual General Meeting, and being eligible, offer themselves for re-appointment as Directors of the Company, subject to retirement by rotation.

Dr. N C B Nath and Shri S R Ramakrishnan who were appointed as Additional Directors of the Company and who holds office up to the conclusion of this Annual General Meeting, and being eligible, offer themselves for re-appointment as Directors of the Company, subject to retirement by rotation.

AUDITORS

M/s. M. Bhaskara Rao & Co., Chartered Accountants, Hyderabad, the Statutory Auditors of the Company retires at the conclusion of the ensuing Annual General Meeting. They have signified their willingness to accept re-appointment vide letter dated April 05, 2011 and have further confirmed their eligibility under section 224(1 B) of the Companies Act, 1956.

PERSONNEL

There are no employees as on date on the rolls of the Company who are in receipt of remuneration which requires disclosures under Sec 217 (2A) of Companies Act, 1956 and Companies (Particulars of Employees) Rules, 1957. DISCLOSURES

There are no particulars to be disclosed in relation to Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo as required under the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988.

DIRECTORS RESPONSIBILITY STATEMENT

Your Directors wish to state the following, with regard to the preparation of Annual Accounts for the year ended March 31, 2011

1. That in preparation of Annual Accounts, the applicable and relevant Accounting Standards have been followed and there have been no major or material departure from the standards.

2. That 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 and of financial year and of Profit and Loss Account of the company for the year under review.

3. That proper and sufficient care has been taken 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 frauds and other irregularities.

4. That the Annual Accounts have been prepared on a 'going concern' basis.

June 17, 2011 By Order of Board

Hyderabad Chairman

 
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