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Directors Report of Neo Corp International Ltd.

Mar 31, 2014

The Members

M/s Neo Corp International Limited

DearShareholders

The Directors are delighted to present the 29th Annual Report of your Companya long with the audited accounts for the year ended on 31st March 2014.

PERFORMANCE HIGHLIGHTS

The financial results for the year ended on 31.03.2014 are as under:

(Rs. In Lacs)

PARTICULARS 2013-14 2012-13

Gross Income 59966.23 43010.98

Profit before Interest, Depreciation and Tax 7046.89 4930.37 Less:

1) Interest 2832.95 2225.35

2) Depreciation 768.81 479.70

3) Provision for Tax

-Current Tax 1425.00 541.00

-Deferred Tax 47.54 101.27

4) Prior Period adjustments_

Profit after Tax 1972.59 1583.05

Appropriation

Transfer to General Reserve 25.00 25.00

Proposed dividend and tax on prop. Dividend 89.21 220.95

Earning per equity share_ 5.19 4.16

YEAR IN RETROSPECT

Your Company has maintained its excellent pace of growth reflected by the significant rise in Turnover. During the year under review, your Company has recorded a turnover of 592.25 Crores as against Rs. 424.23 Crores in the previous year registering an increase of 39.61%. The Net profit (before tax and extra ordinary items) for the financial year ended 31st March 2014 increased to Rs.34.45 Crores from Rs. 30.07 Crores in the previous year representing an increase of 14.57%.

DIVIDEND

Yours directors are pleased to recommend a dividend of 0.20/- per equity share at the rate of 2% for the financial year ended on 31st March 2014 on 38022198 fully paid equity shares of 10/- each. The dividend, if approved, will be paid to the members within the time period stipulated by the Companies Act, 2013.

The directors recommend that after making provision for taxation and proposed dividend the amount of 0.25 Cr. be transferred to General Reserve. With this the company''s reserve and surplus stands atRs. 218.48 Cr.

BUSINESSOVERVIEW

The technical textiles sector being one of the most innovative branches of the industry in the world is ranking as one the five high tech sectors with the greatest potential for development. India is now emerging as a powerhouse of both production as well as end- use consumption of technical textiles. The demand for technical textiles will be boosted by the changing economics cenario.

The success of technical textiles is primarily due to the creativity, innovation and versatility in fibres, yarns and woven/ knitted/ nonwoven fabrics with applications spanning an enormous range of uses. The ability of technical textiles to combine with each other and with others to create a new functional products offer unlimited opportunity to growth.

The production of different items of technical textile industry has been slowly but steadily increasing in the country which is further contributing in the growth of the industry as a whole.

Global Scenario:

Technical Textile is the sunrise segment of the global Textile industry. With increasing competition and diminishing margins in the production of conventional textiles, textile manufacturers in industrialized countries have switched over to production of value- added technical textiles. As the use of technical textiles is dictated by need, its pricing normally offers good margins. The Technical Textile industry is estimated to account for over 50% of the total textile activity in certain industrialized countries. While the US continues to be the main manufacturers and consumers of functional textiles, China has emerged as a large manufacturer of the same. India and Russia are the other important markets for technical textiles, where consumption is increasing at afastpace.

The Indian Scenario:

India is emerging as a significant player in technical textiles. The fast- paced economic growth leading to infrastructure creation as well as higher disposable income has made India a key market for the technical textile products. Moreover, the country has developed a foothold in the production of technical textiles. Considering its highly skilled and scientific/technical manpower and abundant availability of raw materials, India can emerge as a key player in the technical textiles industry.

lndianTextilelndustryinvolvesaround35million workers directlyand accounts for 21% of the total employment generated in the economy, the second largest provider of employment after agriculture. Thus, Technical textiles holds significant potential in India and the government has already taken steps to promote this industry. Indian technical textile market is nascent and is quite honestly depending on government''s push and mandatory regulations to penetrate into different sectors. The market for technical textiles is expected to cross 1.5 lakh crore by 2016-17. The strong interest in the segment is driven by better profit margins and less competition.

JOINTVENTURE

For its long term strategic objectives, your Company continued to give impetus towards taking new business initiatives by formation of a new Joint Venture (JV) named ''Neo Ds Advanced Nonwovens Limited''. The JV is controlled by Neo Corp and a Belgium Based Company De Saedeleir Textile Platform (''DS'') with a plan to venture into rPET needlefelt project. ''DS'' is one of the major European PET fibre and needlefelt producers. Neo Corp is having 51% stake in the sharecapital of the newJV Neo Ds Advanced Nonwovens Limited''.

SUBSIDIARY COMPANIES

Information and Documents Pursuanttotheprovisionsof theSection 212 of the Companies Act, 1956 relating to Europlast Limited, Sacos Indigo Private Limited, Neoflex Infracon Limited, Poly Logic International Private Limited, Prism Flexible Solutions Private Limited and Polybase (H.K.) Limited subsidiary Companies are annexed forming Part of this Report.

CONSOLIDATION OF ACCOUNTS

The Consolidated Financial Statements presented by the Company include financial results of its subsidiary companies approved in accordance with Accounting Standards and as per revised Schedule VI of the Companies Act, 1956. The Ministry of Corporate Affairs, Government of India vide its circular No. 5/12/2007-CL-lll dated 8th February, 2011 has granted exemption under 212(8) of the Companies Act, 1956 from attaching Balance Sheet, Profit and Loss account and other documents of the subsidiary companies to the balance sheet of the Company, provided certain conditions are fulfilled.

Accordingly, the Company will make availabletheAnnual Accounts of the subsidiary companies and the related detailed information to any member of the Company who may be interested in obtaining the same. The annual accounts of the subsidiary companies will also be kept open for inspection at the Registered Office of the Company and that of the respective subsidiary companies. The company will furnish a hard copy of details of accounts of subsidiaries to any shareholderon demand.

GOVERNMENT RECOGNIZEDR & DCENTER

NCIL has set its own R & D Centre which is recognized by Department of Science and Industrial Research under Ministry of Science and Technology. R & D Centre is equipped with all necessary testing equipments and competent scientists to conduct R&D activities. R & D Centre is having a library where all national and international standards, magazines, newsletters and technical literature necessary for R & D activities available. R & D envisions in assisting NCIL, to raise its profile to the zenith of top most manufactures of technical textile through relentless R & D activities. Mission of R & D center is to discover new materials, process and technologies to deliver products, services and solutions to the complete satisfaction of end users.

INSURANCE CLAIM

A fire broke out in TECHTEXTIL, the EOU division of NCIL situated at Pithampur, on 27th February at midnight, 2010 bringing a loss to plant, machinery, stock in process and finished stock. The inferno which caused damaged was insured under various policies taken from United India Insurance Company Limited and Oriental Insurance Company Limited. The total claim launched was to the tune of INR 52.05 crores. The company has received the claim of INR 39.43 Crores, during the earlier year. The Company has filed arbitration against the assessment of claim of INR 4.88 Crores. The Company is hopeful to receive the said amount.

CORPORATE GOVERNANCE

A detailed report on the status of implementation of the corporate governance guidelines has been furnished as an annexure to this report.

DIRECTORS'' RESPONSIBILITYSTATEMENT

Pursuant to the provisions of Sec 217(2AA) of Companies Act, 1956, thedirectorsstatethat:

a. that in preparation of the annual accounts, the applicable accounting standards have been followed alongwith proper explanations relatingto material departures if any,

b. that the directors have selected such accounting policies and applied them consistently and made judgements and estimates thatarereasonableand prudent soastogivetrueandfairviewof the state of affairs of the company at the end of the financial year and of the profit of the company for that period,

c. that the directors have taken proper and sufficient care of 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 have prepared the annual accounts on a going concern basis.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION & FOREIGN EXCHANGE EARNING AND OUTGO

A. CONSERVATION OF ENERGY

The rules relating to the disclosure of particulars with respect to the conservation of energy is not applicable to the company. However the company continued its conscious efforts to minimize energy consumption and more and more innovations and improvements were introduced to further reduce the energy consumption.

B. TECHNOLOGY ABSORPTION-ADAPTATION AND INNOVATION

RESEARCHANDDEVELOPMENT(R&D):

The Company has set up a separate R&D department with a mandate to take care of Continuous enhancement in process, efficiency, product range and protection of intellectual property rights Filing of patents for several products developed in past years is in advance stage.

Specific areas in which R&D carried out by the company.

The company continued its efforts towards the extension of the product range, loweringcosts, process improvements & upgradation, installation of energy efficientequipments.

Benefitsderived

- Performance improvement

- Development of in-house skills to manufacture high value added products

- Improvingsupply chain efficiency

- Cost reduction

- Environment sustainability Future Plan of action

- Development of Geotextile fabrics for various re-enforcement, filtration and separation applications.

- Ensuring perennial business with the network.

- Reduced cost of network management.

- OEE analysis & Productivity improvement of Blown film plant and knitting machines

- Differentiating ourselves on technical excellence across all faculties.

Expenditure on R&D:Rs. 67.00 Lacs

TECHNOLOGY ABSORPTION. ADAPTATION AND INNOVATION:

The company also continued to use the latest technologies for improving the productivity and quality of the products manufactured. The company is employing indigenous technology for its operations.

FOREIGN EXCHANGE EARNING ANDOUTGO

The company has earned foreign exchange of 14255.18 lacs during the year.

The details of foreign exchange outgo are as follows:

Material import : 3223.92 lacs

Stores & spares : Rs.NIL

Capital goods : Rs. 2884.60 lacs

Expenditure in foreign currency : 68.72 lacs

PARTICULARSOF EMPLOYEES

The information required under Sec 217(2A) of the Companies Act 1956 is not given as there was no employee in receipt of remuneration duringtheyear, exceedingthe limits prescribed by the Companies (Particulars of Employees) Rules, 1975 as revised.

DEPOSITS

The company has not accepted any deposit from the public attracting the provisionsofSec58AoftheCompanies Act 1956.

DIRECTORS

At the ensuing Annual General Meeting, Mr. Utkarsh Trivedi, Director of the Company, retires by rotation and being eligible offers himself for re-appointment.

AUDITORS

M/s. A. P. Garg & Co., Chartered Accountants hold office until the conclusion oftheensuing Annual General Meetingandareeligiblefor re-appointment. They have furnished a certificate to the effect that their appointment if made, would be within the prescribed limits under Sec 224 (lB) of the Companies Act 1956.

AUDITORS''REPORT

Report of the auditors and their observations and notes to the accounts of the company for the year under review are attached herewith which are self-explanatory and do not require further explanation.

ACKNOWLEDGEMENT

Your Directors provide their gratitude to the various Government Agencies, Banks and financial institutions, investors, Company''s business associates, customers, suppliers and other service providers fortheircontinued support.

Your Directors place on record their sincere appreciation of the contributions made by the employees of the Company and its subsidiaries at all level through their hard work, dedication and support in ensuring an excellent all around operational performance.

The Board appreciates and value the contributions made by every member of the "NCIL" family globally. The Board is also deeply grateful to the shareholders for the confidence and faith that has been reposed in them. Driven by values and powered by internal vitality, the entire "NCIL Group" stands committed to create an even brighter future for all the stake holders.

Date: 30th May, 2014 Forand on behalf of the Place: Indore Board of Directors

SUNILK. TRIVEDI DIN No. 00053000 (Chairman & Managing Director)


Mar 31, 2013

To The Members of M/s Neo Corp International Limited

Dear Shareholders

The Directors are delighted to present the 28th Annual Report of your Company along with the audited accounts for the year ended on 31 st March 2013.

PERFORMANCE HIGHLIGHTS

The financial results for the year ended on 31.03.2013 are as under:

(Rs.In Lacs) PARTICULARS 2012-13 2011-12

Gross Income 43010.98 28998.90

Profit before Interest, Depreciation and Tax 4930.37 4426.80

Less:

1) Interest 2225.35 1855.30

2) Depreciation 479.70 373.78

3) Provision for Tax

-Current Tax 541.00 82.50

-Deferred Tax 101.27 457.28

4) Prior Period adjustments (-) (-) Profit after tax 1583.05 1657.94 Appropriation

Transfer to General Reserve 25.00 25.00

Proposed dividend and tax on prop. Dividend 220.95 225.28

Earning per equity share 4.16 7.44

YEAR IN RETROSPECT

Your Company has maintained its excellent pace of growth reflected by the significant rise in Turnover. During the year under review, your Company has recorded a turnover of 424.23 Crores as against Rs. 283.99 Crores in the previous year registering an increase of 49.38%. The Net profit (before tax and extra ordinary items) for the financial year ended 31st March 2013 increased to Rs. 30.07 Crores from ^21.97 Crores in the previous year representing an increase of 36.86 %.

DIVIDEND

Yours directors are pleased to recommend a dividend ofRs. 0.50/- per equity share at the rate of 5% for the financial year ended on 31st March 2013 on 38022198 fully paid equity shares of Rs. 107- each.

The directors recommend that after making provision for taxation and proposed dividend the amount of Rs.0.25 Cr. be transferred to General Reserve. With this the company''s reserve and surplus stands at Rs. 197.42 Cr.

BUSINESS OVERVIEW

Technical Textile sector is one of the most innovative branch of the industry in the world, ranking as one the five high tech sectors with the greatest potential for development. The success of technical textiles is primarily due to the creativity, innovation and versatility in fibres, yarns and woven/knitted/nonwoven fabrics with applications spanning an enormous range of uses. The ability of technical textiles to combine with each other and with others to create a new functional products offer unlimited opportunity togrowth.

The growth of the industry has been primarily due to the entrepreneurial ingenuity of the Indian industry supplemented by the scheme of the government of the Indian incentivizing the investment in the sector. The government of India also recognized the need to have the industry''s active participation to bring out the issues, concerns and suggest policy framework that would lay the foundation for this sector.

The production of different items of technical textile industry has been slowly but steadily increasing in the country which is furthercontributing in the growth of the industry as a whole.

Global Scenario:

Technical Textile is the sunrise segment of the global Textile industry. With increasing competition and diminishing margins in the production of conventional textiles, textile manufacturers in industrialized countries have switched over to production of value-added technical textiles. As the use of technical textiles is dictated by need, its pricing normally offers good margins. The Technical Textile industry is estimated to account for over 50% of the total textile activity in certain industrialized countries.

The US is the largest consumerof technical textiles, followed by Western Europe and Japan. However, Technical Textile industry in the developed world is maturing in a significant way resulting in moderate growth in these economies In contrast China, India and other countries in Asia, America and Eastern Europe are expected to experience healthy growth in the near future. Asia is emerging as a powerhouse of both production as well as consumption of technical textiles. China, Japan, Korea, Taiwan and India have great potential to make an impact in this industry in the coming decade.

The Indian Scenario:

India is emerging as a significant player in technical textiles. The fast-paced economic growth leading to infrastructure creation as well as higher disposable income has made India a key market for the technical textile products. Moreover, the country has developed a foothold in the production of technical textiles owing to its skilled and technical manpower as well as abundant availability of raw-material.

Technical Textiles is one of the fastest growing segment of the Indian economy. It has registered compounded annual rate of growth of 11 % during 11 th five year plan and the working group report for the 12th five year plan has projected growth of 20% for technical textiles. This translates into market size increasing from USD 13 billion to USD 36 billion by 2016-17.

Indian technical textile market is nascent and is quite honestly depending on government''s push and mandatory regulations to penetrate into different sectors. The market for technical textiles is expected to cross Rs.1.5 lakh crore by 2016-17. The strong interest in the segment is driven by better profit margins and less competition.

INCORPORATION OF SUBSIDIARYCOMPANY

The promoters of NCIL have incorporated a company in the name and style of Ms Prism Flexible Solutions Private Limited''. By virtue of controlling the composition of Board of Directors of Prism Flexible Solutions Private Limited, the said company becomes the subsidiary Company of Neo Corp International Limited with effect from 18 07.2012. The Company is engaged in the business of trading and manufacturing of flexible packaging material and other allied products.

SUBSIDIARYCOMPANY

Information and Documents Pursuant to the provisions of the Section 212 of the Companies Act 1956 relating to Europlast Limited, Sacos Indigo Private limited, Neoflex Infracon Limited, Poly Logic International Private Limited, Prism Flexible Solutions Private Limited and Polybase (H.K.) Limited subsidiary Companies are annexed forming Part of this Report.

CONSOLIDATION OF ACCOUNTS

The Consolidated Financial Statements presented by the Company include financial results of its subsidiary companies approved in accordance with Accounting Standards and as per revised Schedule VI of the Companies Act, 1956. The Ministry of Corporate Affairs, Government of India vide its circular No 5/12/2007-CL-lll dated SthFebruary, 2011 has granted exemption under 212(8) of the Companies Act, 1956 from attaching Balance Sheet Profit and Loss account and other documents of the subsidiary companies to the balance sheet of the Company, provided certain conditions are fulfilled.

Accordingly, the Company will make available the Annual Accounts of the subsidiary companies and the related detailed information to any member of the Company who may be interested in obtaining the same. The annual accounts of the subsidiary companies will also be kept open for inspection at the Registered Office of the Company and that of the respective subsidiary companies. The company will furnish a hard copy of details of accounts of subsidiaries to any shareholder on demand.

GOVERNMENT RECOGNIZED R&D CENTER

NCIL has set its own R & D Centre which is recognized by Department of Science and Industrial Research under Ministry of Science and Technology.R & D Centre is equipped with all necessary testing equipments and competent scientists to conduct R&D activities. R&D Centre is having a library where all national and international standards, magazines, newsletters and technical literature necessary for R & D activities available. R&D envisions in assisting NCIL, to raise its profile to the zenith of top most manufactures of technical textile through relentless R&D activities. Mission of R & D center is to discover new materials, process and technologies to deliver products, services and solutions to the complete satisfaction of end users.

UNITINDAHEJSEZLTD.ATDAHEJ

Looking into betterfuture prospects, NCIL made an application to Dahej SEZ Ltd for allotment of land for setting up of a manufacturing unit in Dahej SEZ Ltd at Dahej. The land has been allotted to the company and the Company has entered into an MOU with Vibrant Gujarat 2013''for investment in Gujarat. This expansion program shall take the company towards more value added products in the upcoming technical textile sector.

INSURANCE CLAIM

A fire broke out in TECHTEXTIL, the EOU division of NCIL situated at Pithampur, on 27th February at midnight, 2010 bringing a loss to plant, machinery, stock in process and finished stock. The inferno which caused damaged was insured under various policies taken from United India Insurance Company Limited and Oriental Insurance Company Limited. The total claim lodged was to the tune of Rs. 52.05 crores. The company has received the claim of Rs. 39.43 Crores (including of Rs. 1.30 crores realized from scrap sale). The Company has also written off R 782.38 Lacs during the year. The balance claim of R488.68 Lacs in respect of fixed assets not considered by the insurance companies is still receivable as per management and the matter is pending with appointed arbitrator.

CORPORATE GOVERNANCE

A detailed report on the status of implementation of the corporate governance guidelines has been furnished as an annexure to this report.

DIRECTORS''RESPONSIBILITYSTATEMENT

Pursuant to the provisions of Sec 217(2AA) of Companies Act, 1956, the directors state that:

a. that in preparation of the annual accounts, the applicable accounting standards have been followed alongwith proper explanations relating to material departures if any,

b. that the directors have selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give 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 period,

c. that the directors have taken proper and sufficient care of 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 have prepared the annual accounts on a going concern basis.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION & FOREIGN EXCHANGE EARNING AND OUTGO

A CONSERVATION OF ENERGY

The rules relating to the disclosure of particulars with respect to the conservation of energy is not applicable to the company. However the company continued its conscious efforts to minimize energy consumption and more and more innovations and improvements were introduced to further reduce the energy consumption.

B. TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION

RESEARCH AND DEVELOPMENT (R&D):

The Company has set up a separate R&D department with a mandate to take care of Continuous enhancement in process, efficiency, product range and protection of intellectual property rights

Filing of patents for several products developed in past years is in advance stage.

Specific areas in which R & D carried out by the company

The company continued its efforts towards the extension of the

Benefits derived

- Performance improvement

- Development of in-house skills to manufacture high value added products

- Improving supply chain efficiency

- Cost reduction

- Environment sustainability Future Plan of action

- Development of Geotextile fabrics for various re- enforcement, filtration and separation applications.

- Piggysackingofotherproductswithproductsofdemand.

- Ensuring perennial business with the network.

- Reduced cost of network management.

- OEE analysis & Productivity improvement of Blown film plant and knitting machines

- Differentiating ourselves on technical excellence across all faculties.

Expenditure on R&D: Rs. 402.89 Lacs

TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION:

The company also continued to use the latest technologies for improving the productivity and quality of the products manufactured. The company is employing indigenous technology for its operations.

FOREIGN EXCHANGE EARNING AND OUTGO

The company has earned foreign exchange of Rs.10084.75 lacs during the year.

The details of foreign exchange outgo are as follows:

Material import : Rs. 1072.04 lacs

Stores & spares : Rs.5.92 lacs

Capital goods : Rs. 543.65 lacs

Expenditure in foreign currency : Rs. 30.72 lacs

PARTICULARS OF EMPLOYEES

The information required under Sec 217(2A) of the Companies Act 1956 is not given as there was no employee in receipt of remuneration during the year, exceeding the limits prescribed by the Companies (Particulars of Employees) Rules, 1975 as revised.

DEPOSITS

The company has not accepted any deposit from the public attracting the provisions of Sec 58Aof the Companies Act 1956.

DIRECTORS

Mr. Sanjay K.Trivedi has resigned from the Directorship on 22nd April 2013 and Mr. Utkarsh S. Trivedi was appointed as additional Director w.e.f. 22nd April 2013.

At the ensuing Annual General Meeting, Mr. Ladharam Patel and Mr. Shrawan Kumar Patodi, Directors of the Company, retires by rotation and being eligible offers himself for re- appointment. Mr. Ladharam Patel and Mr. Shrawan Kumar Patodi are the independent Directors of the Company having vast experience in industry and administration.

AUDITORS

M/s. A.P. Garg & Co., Chartered Accountants hold office until the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment They have furnished a certificate to the effect that their appointment if made, would be within the prescribed limits under Sec 224(1 B) of the Companies Act 1956.

AUDITORS''REPORT

Report of the auditors and their observations and notes to the accounts of the company for the year under review are attached herewith which are self-explanatory and do not require further explanation.

ACKNOWLEDGEMENT

Your Directors provide their gratitude to the various Government Agencies, Banks and financial institutions, investors, Company''s business associates, customers, suppliers and other sen/ice providers for their continued support.

Your Directors place on record their sincere appreciation of the contributions made by the employees of the Company and its subsidiaries at all level through their hard work, dedication and support in ensuring an excellent all around operational performance.

The Board appreciates and value the contributions made by every member of the "NCIL" family globally. The Board is also deeply grateful to the shareholders for the confidence and faith that has been reposed in them. Driven by values and powered by internal vitality, the entire "NCIL Group" stands committed to create an even brighterfuture for all the stakeholders.

Date: 30th May, 2013 For and on behalf of

Place: Indore the Board of Directors

SUNIL K. TRIVEDI

Chairman & Managing Director


Mar 31, 2012

To The Members of M/s Neo Corp International Limited Dear Shareholders

The Directors are delighted to present the 27th Annual Report of your Company along with the audited accounts for the year ended on 31st March, 2012.

PERFORMANCE HIGHLIGHTS

The financial results for the year ended on 31st March, 2012 are as under:

(Rs.In Lacs) PARTICULARS 2011-12 2010-11

Gross Income 28998.90 23949.70

Profit before Interest, 4426.80 3287.96

Depreciation and Tax

Less :

1) Interest 1855.30 1368.85

2) Depreciation 373.78 252.26

3) Provision for Tax

-Current Tax 82.50 134.19

- Deferred Tax 457.28 114.06

4) Prior Period adjustments (_) (-)

Profitafter Tax 1657.94 1418.61

Appropriation

TransfertoGeneralReserve 25.00 25.00

Proposed dividend and tax on prop. 225.28 82.03 dividend

Earningperequityshare 7.44 12.04

YEAR IN RETROSPECT

During the year under review, your Company has recorded a turnover of Rs. 283.99 Crores as against Rs. 231.07 Crores in the previous year. The Net profit (after tax and extra ordinary items) for the financial year ended 31st March, 2012 increased toRs. 16.58 Crores from Rs. 14.19 Crores in the previous year representing an increase of 16.84% profit aftertax.

DIVIDEND

Yours Directors are pleased to recommend a dividend of Rs. 0.50/- per equity share at the rate of 5% for the financial year ended on 31st March, 2012 on 38022198 fully paid equity shares ofRs. 10/-each.

The Directors recommend that after making provision for taxation and proposed dividend the amount of Rs. 0.25 Crores be transferred to General Reserve. With this the company's reserve and surplus stands at Rs. 181.33 Crores.

BUSINESS OVERVIEW

Technical Textiles offers a huge opportunity in India for both local consumption as well for exports. Based on current usage patterns the Domestic Consumption market alone is expected to exceed US $ 13 billion by 2012/13.

To facilitate the growth of this industry in India- the office Of TEXTILE COMMISIONER MINISTRY OF TEXTILES, Government of India -recognized the need to have the industry's active participation to bring out the issues, concerns and suggest policy framework that would lay the foundation for this sector.

Given the fact that Government policy have played a critical role in the advancement of Technical textiles INDIAN TECHNICAL TEXTILE ASSOCIATION is expected to maintain close interaction with Government of India in formulating a National Technical Textiles Policy focusing on removing the ambiguities in the system which are hampering the growth of the sector, helping bring in legislation which will help spur usage in India and recommending fiscal and non fiscal norms which would aid the industry to achieve its true potential.

Global Scenario:

The global market for technical textiles was estimated to have a volume of 16.7 mn ton with a value of US$ 92.88 billions in the year 2008 and is expected to grow to a volume of 27.77 mn ton with a value of US$ 140 billion by the year 2012. In developed nations technical textiles holds a share of more than 40% of the total textile manufacturing activity. While the US and EU continues to be the main manufacturers and consumers of functional textiles, China has emerged as a large manufacturer of the same. India and Russia are the other important markets for technical textiles, where consumption is increasing at a fast pace.

The Indian Scenario:

In the present scenario, technical textiles have been identified as a great potential area for upgrading the Indian textile industry. Since the conventional textiles industry has reached a level of saturation in terms of development, innovation and value-addition, technical textiles offer a great opportunity to succeed in the post WTO scenario.

As per Mr. A. B. Joshi, Textile Commissioner, Ministry of Textiles, the technical textiles industry is forecast to grow at Rs. 1,58,000 crore by 2016-17, with a projected growth of 20 per cent, the technical textiles industry in India namely, Medical (Medtech), Geo-Textiles (Geotech), Protective Textiles (Protech) & Agricultural Textiles (Agrotech).

Secondly as the country is transforming into a developed nation, huge emphasis is being laid down in adopting

latest technologies and procedures in various fields. Therefore the market for technical textiles is very positive and poised for a stupendous growth. Attractive statistics for market potential seem inviting for global intervention.

Considering that India has a large pool of skilled and scientific/technical manpower, it can play a major role in shaping the future of this industry. Development of new fibers and technologies has led to the creation of new applications of technical textiles, which is bound to enlarge the market size and offer opportunities for high growth.

The growth of technical textiles will also lead to steep rise in the demand for highly skilled manpower for both production & R&D. This should throw open a new area that has tremendous opportunities of employment, which is a major focus of the national government today.

Since the growth of technical textiles industry serves the interests of the government and the nation, hence it is inevitable to see a major thrust on the development of this industry by giving impetus on product and local consumption. This offers a compelling reason for the buyers and sellers of technical textiles to keep theirfocus on India and develop a rational strategy to seize the emerging opportunities. (Source-Economic Times)

INCORPORATION OF SUBSIDIARY COMPANY

The promoters of NCIL had incorporated a company in the name and style of 'M/s Poly Logic International Private Limited'. The company falls under Part IX by virtue of which PLIPL became a 'wholly owned subsidiary of Neo Corp International Limited'. The company will be engaged in manufacturing of Technical Textiles under the Agrotech segment. This projects falls underthe Technical Textiles segment of the TUFS scheme, and is financed by EXIM Bank Limited, Mumbai.

SUBSIDIARY COMPANY

Information and Documents Pursuant to the provisions of the Section 212 of the Companies Act 1956 relating to Europlast Limited, Sacos Indigo Private limited, Neoflex Infracon Limited, Poly Logic International (P) Limited and Polybase (H.K.) Limited subsidiary Companies are annexed forming Part of this Report.

CONSOLIDATION OF ACCOUNTS

The Consolidated Financial Statements presented by the Company include financial results of its subsidiary companies approved in accordance with Accounting Standards and as per revised Schedule VI of the CompaniesAct, 1956. The MinistryofCorporate Affairs, Government of India vide its circular No. 5/12/2007-CL-lll dated 8th February, 2011 has granted exemption under 212(8) of the Companies Act, 1956 from attaching Balance Sheet, Profit and Loss account and other documents of the subsidiary companies to the balance sheet of the Company, provided certain conditions are fulfilled.

Accordingly, the Company will make available the Annual Accounts of the subsidiary companies and the related detailed information to any member of the Company who may be interested in obtaining the same. The annual accounts of the subsidiary companies will also be kept open for inspection at the Registered Office of the Company and that of the respective subsidiary companies. The company will furnish a hard copy of details of accounts of subsidiaries to any shareholder on demand.

COMPANY'S GDR ISSUE

A blanket approval in shareholder's meeting held on 11.04.2011 has been taken for the issue of US $100 million GDR. In first tranche Company issued and allotted in its Board meeting held on 5th August, 2011,24,000,000 equity shares of Rs. 10 each representing 1,200,000 Global Depositary Receipts (GDRs). Each GDR is representing 20 underlying Equity Shares. The Company has utilized the proceeds from the issue of the GDRs towards expansion of the present business activities of the Company and the group and augmenting the long term working capital.

GOVERNMENT RECOGNIZED R&D CENTER

NCIL has set its own R&D Centre which is recognized by Department of Science and Industrial Research under Ministry of Science and Technology. R&D Centre is equipped with all necessary testing equipments and competent scientists to conduct R&D activities. R&D Centre is having a library where all national and international standards, magazines, newsletters and technical literature necessary for R & D activities available. R&D envisions in assisting NCIL, to raise its profile to the zenith of top most manufactures of technical textile through relentless R&D activities. Mission of R & D center is to discover new materials, process and technologies to deliver products, services and solutions to the complete satisfaction of end users.

INSURANCE CLAIM

A fire broke out in TECHTEXTIL, the EOU division of NCIL situated at Pithampur, on 27th February at midnight, 2010 bringing a loss to plant, machinery, stock in process and finished stock. The inferno which caused damaged was insured under various policies taken from United India Insurance Company Limited and Oriental Insurance Company Limited. The total claim launched was to the tune of INR 52.05 crores. The company has received the interim claim of INR 7.50 Crores each, from both the insurance companies. The final survey report has been received and the final claim amount as assessed by the surveyors stands to INR 39.43 crore, including the scrap sale. The process for final payment of the balance amount of claim is at an advance stage and is expected to be received by end of September2012.

WINDMILL PROJECT

NCIL has ventured into the business stream of power generation with the help of Wind Turbine Generators (WTGs). The company has setup a windmill of the capacity 1.5 mega watt at Bhavdikheda Mahuriya, Dist. Shajapur in Madhya Pradesh.

The motive behind this venture is to gain advantage of the attractive ROI generated on the sale of wind mill power (electricity) to the state electricity board. The company is now looking at increasing installed capacities with more windmills, also to contribute the bit towards a 'greener planet', and in the infrastructural growth of the country.

LISTING

The shares ofthe Company continue to be listed on the Bombay Stock Exchange Limited (BSE) and Madhya Pradesh Stock Exchange Limited (MPSE). The annual listing fee for the year 2012-2013 has been paid to the Exchange(s).

Pursuant to MoU of Madhya Pradesh Stock Exchange Limited with National Stock Exchange Limited under Section 13 of SCRA, securities of Neo Corp International Ltd are eligible to trade and admitted to dealings on National Stock Exchange of India Ltd. (Capital Market Segment) under permitted category with effect from 2nd March, 2012 vide theirCirculardated 29thFebruary, 2012.

CORPORATE GOVERNANCE

A detailed report on the status of implementation of the corporate governance guidelines has been furnished as an annexure to this report.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the provisions of Sec 217(2AA) of Companies Act, 1956, the directors state that:

a. that in preparation of the annual accounts, the applicable accounting standards have been followed alongwith proper explanations relating to material departures if any,

b. that the directors have selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give true and fair view of the state of affairs ofthe company at the end ofthe financial year and ofthe profit of the company for that period

c. that the directors have taken proper and sufficient care of 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 have prepared the annual accounts on a going concern basis.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION & FOREIGN EXCHANGE EARNING AND OUTGO

A. CONSERVATION OF ENERGY

The rules relating to the disclosure of particulars with respect to the conservation of energy is not applicable to the company. However the company continued its conscious efforts to minimize energy consumption and more and more innovations and improvements were introduced to further reduce the energy consumption.

B. TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION

RESEARCH AND DEVELOPMENT (R&D):

The Company has set up a separate R&D department with a mandate to take care of Continuous enhancement in process, efficiency, product range and protection of intellectual property rights

Filing of patents for several products developed in past years is in advance stage.

Specific areas in which R&D carried out by the company

The company continued its efforts towards the extension of the product range, lowering costs, process improvements & upgradation, installation of energy efficient equipments.

Benefits derived

- Performance improvement

- Development of in-house skills to manufacture high value added products

- Improving supply chain efficiency

- Cost reduction

- Environmentsustainability Future Plan of action

- Development of Geotextile fabrics for various re- enforcement, filtration and separation applications.

- Piggy backing of other products with products of demand.

- Ensuring perennial business with the network.

- Reduced cost of network management.

- OEE analysis & Productivity improvement of Blown film plantand knitting machines

- Differentiating ourselves on technical excellence across all faculties.

Expenditure on R&D: Rs. 567.19 Lacs

TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION:

The company also continued to use the latest technologies for improving the productivity and quality of the products manufactured. The company is employing indigenous technology for its operations.

FOREIGN EXCHANGE EARNING AND OUTGO

The company has earned foreign exchange ofRs. 9137.10 lacs during the year.

The details of foreign exchange outgo are as follows: Material import : Rs. 165.20 lacs

Stores & spares : Rs. 5.46 lacs

Capital goods : Rs. 1645.96 lacs

Expenditure in foreign currency : Rs. 102.04 lacs PARTICULARS OF EMPLOYEES

The information required under Sec 217(2A) of the Companies Act 1956 is not given as there was no employee in receipt of remuneration during the year, exceeding the limits prescribed by the Companies (Particulars of Employees) Rules, 1975as revised.

DEPOSITS

The company has not accepted any deposit from the public attracting the provisions of Sec 58A of the Companies Act 1956.

DIRECTORS

Mr. Sanjay Trivedi and Mr. Rolland Coderre retire by rotation and being eligible offer themselves for reappointment.

AUDITORS

M/s. A.P. Garg & Co., Chartered Accountants hold office until the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment. They have furnished a certificate to the effect that their appointment if made, would be within the prescribed limits under Sec 224(1B)ofthe Companies Act 1956.

AUDITORS'REPORT

Report of the auditors and their observations and notes to the accounts of the company for the year under review are attached herewith which are self-explanatory and do not require further explanation.

ACKNOWLEDGEMENT

Your Directors provide their gratitude to the various Government Agencies, Banks and financial institutions, investors, Company's business associates, customers, suppliers and other service providers for their continued support.

Your Directors place on record their sincere appreciation of the contributions made by the employees of the Company and its subsidiaries at all level through their hard work, dedication and support in ensuring an excellent all around operational performance.

The Board appreciate and value the contributions made by every member of the "NCIL" family globally. The Board is also deeply grateful to the shareholders for the confidence and faith that has been reposed in them. Driven by values and powered by internal vitality, the entire "NCIL Group" stands committed to create an even brighterfuture for all the stakeholders.

Date: 30th May, 2012 For and on behalf of

Place: Indore the Board of Directors

(K.S.TRIVEDI)

Chairman


Mar 31, 2011

To The Members of M/s Neo Corp international Limited

The Directors are delighted to present the 26th Annual Report of your Company along with the audited accounts for the year ended on 31 - March 2011.

PERFORMANCE HIGHLIGHTS

The financial results for the year ended on 31.03.2011 are as under:

(Rs. In Lacs)

Particulars 2010-11 2009-10

Gross Income 25322.23 17016.55

Profit before Interest, Depreciation and 3286.14 2083.47

Tax Less:

1) Interest 1368.85 641.30

2) Depreciation 252.26 263.72

3) Provision for Tax

-Current Tax 134.19 228.32

-Deferred Tax 114 06 26.90

4) Prior Period adjustments (1.82) (1.47)

Profit after Tax 1418.60 921.75

Add balance brought forward 2720.17 1874.04

4138.77 2795.79 APPROPRIATION

Transfer to General Reserve 25.00 25.00

Proposed dividend and tax on prop. 82.03 50.62 dividend

Balance carried to Balance Sheet 4031.74 2720.17

4138.77 2795.79

FINANCIAL PERFORMANCE

During the year under review, your Company has recorded a turnover of Rs22859.35 Lacs as against Rs 17562.27 Lacs in the previous year. The Net profit (after tax and extra ordinary items) for the financial year ended 31st March 2011 increased to Rs1418.61 Lacs from Rs921.75 Lacs in the previous year representing an increase of 53.80% profit after tax.

DIVIDEND

Yours directors are pleased to recommend a dividend of Rs0.50/- per equity share at the rate of 5% for the financial year ended on 31st March 2011 on 14022198 fully paid equity shares of Rs10/-each. The directors recommend that after making provision for taxation and proposed dividend the amount of Rs25.00 Lacs be transferred to General Reserve. With this the company's reserve and surplus stands at Rs8005.42 Lacs.

BUSINESS OVERVIEW

Indian economy has been witnessing a phenomenal growth since the last decade. The Indian economy, characterized by strong macro-economic fundamental the midst of the current global financial crisis.

The technical textiles industry has immense potential in the developing countries. India is now emerging as a powerhouse of both production as well as end-use consumption of technical textiles. The demand for technical textiles will be boosted by the changing economic scenario. Considering its highly skilled and scientific/technical manpower and abundant availability of raw materials, India can emerge as a key player in the technical textiles industry.

Further, Indian Textile Industry contributes about 14% of the total industrial production of India. Furthermore, its contribution to the gross domestic product of India is around 3% and the numbers are steadily increasing.

India Textile Industry involves around 35 million workers directly and Accounts for 21% of the total employment generated in the economy, the second largest provider of employment after agriculture. Thus, Technical textiles holds significant potential in India and the government has already taken steps to promote this industry.

INCREASE IN THE SHARE CAPITAL

The Company has increased its Authorised Share Capital from Rs18,00,00,000 (Eighteen crores) to Rs70,00,00,000 (Seventy crores) divided into 69000000 equity shares of Rs10/- each and 1000000 Cumulative Compulsorily Convertible Preference Shares (CCCPs) of Rs10/- each in the Extra- ordinary General Meeting held on 11th April 2011.

ACQUISITION

The Company has acquired shares of M/s Neoflex Infracon Ltd. on 28th May, 2011, which became the Subsidiary of the Company by virtue of acquisition of shares. Neoflex Infracon Ltd. is engaged in the infrastructure development business. NCIL has acquired UK based company Polybase (H.K.) Limited on 18th July, 2011 by virtue of 100% holding of shares.

SUBSIDIARY COMPANY:

Information and Documents Pursuant to the provisions of the Section 212 of the Companies Act 1956 relating to Europlast Limited and Sacos Indigo Private limited, subsidiary Companies are annexed forming Part of this Report.

CONSOLIDATION OF ACCOUNTS

The Consolidated Financial Statements presented by the Company include financial results of its subsidiary companies approved in accordance with Accounting Standards. The Ministry of Corporate Affairs, Government of India vide its circular No. 5/12/2007-CL-lll dated 8lh February, 2011 has granted exemption under 212(8) of the Companies Act, 1956 from attaching Balance Sheet, Profit and Loss account and other documents of the subsidiary companies to the balance sheet of the Company, provided certain conditions are fulfilled.

Accordingly, the Company will make available the Annual Accounts of the subsidiary companies and the related detailed information to any member of the Company who may be interested in obtaining the same. The annual accounts of the subsidiary companies will also be kept open for inspection at the Registered Office of the Company and that of the respective subsidiary companies. The company will furnish a hard copy of details of accounts of subsidiaries to any shareholder on demand.

COMPANY'S GDR ISSUE

NCIL had issued GDRs to over seas investors.

A blanket approval in shareholders' meeting held on 11.04.2011 has been taken for the issue of US $100 million GDR.

In first tranche it is proposed to issue US $25 million GDR. In the Board meeting held on 5lh August, 2011 24,000,000 equity shares of Rs 10 each representing 1,200 000 Global Depositary Receipts (GDRs) for US $ 23.1 million were subscribed and allotted. Each GDR is representing 20 underlying Equity Shares.

The Company intends to use all or substantially all of the proceeds from the issue of the GDRs towards expansion of the present business activities of the Company augmenting long term working capital and any other use, as may be permitted under applicable law or regulations, from time to time. Pending the use of the net proceeds from the offering for the purposes described above, the Company intends to place the net proceeds, to the extent permitted by applicable laws or regulations, in short term money market instruments and mutual funds.

CHANGE IN CAPITAL STRUCTURE PURSUANT TO PREFERENTIAL ISSUE

The Company made a preferential allotment of 35,00,000 equity shares of Rs10/- each at a premium of Rs50/- per share to the promoter and other strategic investors. The Company has also allotted 2,92,898 equity shares of Rs10/- each at a premium of Rs58/- per share on conversion of 292898 Cumulative Compulsory Convertible Preference Shares ('CCCPs') to the persons excluding promoters of the Company and 15,75,000 equity shares of Rs10/-each at a premium of Rs43/- per share pursuant to conversion of warrants to promoters and person other than promoters. The proceeds of the preferential allotment have been used to fund the ongoing expansion and modernization program of the Company and the working capital requirements of the Company.

CORPORATE GOVERNANCE

A detailed report on the status of implementation of the corporate governance guidelines has been furnished as an annexure to this report.

DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the provisions of Sec 217 (2AA) of Companies Act, 1956, the directors state that:

a. that in preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanations relating to material departures if any,

b. that the directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give true and Fairview of the state of affairs of the company at the end of the financial year and of the profit of the company for that period.

c. that the directors have taken proper and sufficient care of the maintenance of adequate accounting records in accordance with the provisions of this act for safe guarding the assets of the company and for preventing and detecting fraud and other irregularities.

d. that the directors have prepared the annual accounts on a going concern basis.



PARTICULARS OF EMPLOYEES

The information required under Sec217(2A)oftheCompaniesAct1956 is Not given as there was no employee in receipt of remuneration during the year, exceeding the limits prescribed by the Companies (Particulars of Employees) Rules, 1975 as revised.

DEPOSITS

The company has not accepted any deposit from the public attracting the provisions of Sec 58 A of the Companies Act 1956.

DIRECTORS

Mr.Kailash Chandra Trivedi and Mr.SunilKumar

AUDITORS

M/s. A.P. Garg & Co., Chartered Accountants hold office until the conclusion of the ensuing Annual General Meeting and are eligible for re- appointment. They have furnished a certificate to the effect that their appointment if made, would be within the prescribed limits under Sec 224( 1B) of theCompaniesAct,1956.

AUDITORS'REPORT

Report of the auditors and their observations and notes to the accounts of the company for the year under review are attached herewith which are self- explanatory and do not require further explanation.

ACKNOWLEDGEMENT

Your Directors provide their gratitude to the various Government Agencies, Banks and Financial Institutions, Investors, Company's Business Associates, Customers, Suppliers and other service providers For their continued support.

Your Directors place on record their since re appreciation of the contributions made by the employees of the Company and its subsidiaries through their hard work, dedication and support in ensuring an excellent all around operational performance.

Your Directors expresses its appreciation of the understanding and support extended by the shareholders of the Company for the confidence reposed on the management of the Company.

By Order of the Board of Directors

Place: Indore K.S.TRIVEDI

Date: 02.09.2011 (CHAIRMAN)

Regd. Office: Plot No. 62-63-64A, Industrial Area, Sector 1, Pithampur, Dist. Dhar(M.P.)


Mar 31, 2010

We have pleasure in presenting to you the 25th Annual Report along with the audited accounts for the year ended on March 2010.

PERFORMANCE HIGHLIGHTS

Financial Results

The financial results for the year ended on 31.3.2010 are as under:

(RS. IN LACS)

2009-10 2008-09

Gross Income 17016.55 13404.90

Profit before Interest Depreciation and Tax 2083.47 1478.45

Less :

1) Interest 641.30 295.53

2) Depreciation 263.72 205.45

3) Provision for Tax

- Current Tax 228.32 229.29

- Fringe Benefit Tax - 5.38

-Deferred Tax 26.90 102.80

4) Prior Period adjustments (1.47) 0.51

Profit after Tax 921.76 639.49

Add : Balance brought forward 1874.04 1310.18

2795.80 1949.67 APPROPRIATION

Transfer to General Reserve 25.00 25.00

Proposed dividend and tax on prop.dividend 50.63 50.63

Balance carried to Balance Sheet 2720.17 1874.04

2795.80 1949.67

During the year under review, your Company has recorded a turnover of Rs. 175.62 Crores as against Rs. 127.82 Crores in the previous year. The Net profit (after tax and extra ordinary items) for the financial year ended 31st March 2010 increased to Rs. 9.22 Crores from Rs. 6.39 Crores in the previous year representing an increase of 44.28%profit aftertax..

DIVIDEND

Yours directors are pleased to recommend a dividend at the rate of 5% for the year ended on 31st March 2010 on 86,54,300 fully paid equity shares of Rs. 10/- each.

The directors recommend that after making provision for taxation and proposed dividend the amount of Rs. 0.25 cr be transferred to General Reserve. With this the companys reserve and surplus stands at Rs. 42.62 cr.

BUSINESS OVERVIEW

According to a study of ICRAon Management Consulting Services, the consumption of technical textiles will enhance by 11 % a year on average to 624 billion Indian Rupees on a value basis during the next three years. During the fiscal year 2007/08 the turnover for technical textile amounted to just Rs. 370 billion.

Technical textiles are mainly used for packaging, apparel, home textiles and automotive manufacturing. The sectors sports equipments, industrial end-use, construction material as well as medical and sanitary consumables are also promising a large potential growth. The study forecasts a consumption-rate between 8 and 15% per year on a value basis depending on the application area.

Year 2009-10 was a good year as the slow down in economy had bottomed out and signs of recovery were seen.

It was only in December 09-January 2010 the heat of slow down was felt due to the coupled effect of slow economy and extended severwinters in Europe lenone.

Technical Textile Industry is poised for good growth in India. In fact the GDP growth of a country is directly proportional to the growth in Consumption of technical textile.

The Company is committed to take advantage of these growth opportunities and therefore has planned a systematic continuous investment strategy.

ACQUISITION

Acquisition of M/s Sacos Indigo Pvt. Ltd.

During the year 2009-10, the Company acquired shares of M/s. Sacos Indigo Pvt. Ltd., engaged in the same line of business, which become the Subsidiary of the Company by virtue of acquisition of shares on 31sl December 2010.

The acquisition shall add thin gauge fabric and laminated consumer packaging products, to the wide product basket of the Company.

SUBSIDIARY COMPANY:

Information and Documents Pursuant to the provisions of the Section 212 of the Companies Act 1956 relating to Europlast Limited and Sacos Indigo Private limited, Subsidiary Companies are annexed forming Part of this Report.

CONSOLIDATION OF ACCOUNTS

In accordance with the requirement of Accounting Standards prescribed by the Institute of the Chartered Accountants of India, the consolidated account of your Company is annexed to this report.

FIRE AT FACTORY

On midnight of 27/28 February, 2010, the Companys new division M/s Techtextile was entirely gutted in fire. Incidentally there was no loss of human life. The Board extends its tribute to the exceptional services and help rendered by the fire, police and local administration and staff. With their support the Company was able to contain the damage only upto the new division. The old division is safe and running.

Due to the commendable team work of our staff the Company was able to restart the assembly section (packtech) within Eight weeks in as leased premises. Orders in hand were executed from contract manufacturing though with a slight delay. The Board also wish to place on record the support and faith extended by the customers.

The lost assets were covered adequately by-two leading Insurance Companies. The Company has lodged the claim of Rs. 52.05 Crores. The survey is at the advance stage and an interim relief of Rs. 7.5 Crores is received from one of the Insurance companies and the company is expecting to receive Rs. 7.5 Crores from the other insurance company.

The Board also wishes to place on record the timely help and support extended by the Bankers.

The rebuilding of lost assets is in advance stage.

CORPORATE GOVERNANCE

A detailed report on the status of implementation of the corporate governance guidelines has been furnished as an annexure to this report.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the provisions of Sec 217(2AA) of Companies Act, 1956, the directors state that:

- that in preparation of the annual accounts, the applicable accounting standards have been followed alongwith proper explanations relating to material departures if any,

- that the directors have selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give 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 period

- that the directors have taken proper and sufficient care of 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

- that the directors have prepared the annual accounts on a going concern basis.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION & FOREIGN EXCHANGE EARNING AND OUTGO

A. CONSERVATION OF ENERGY

The rules relating to the disclosure of particulars with respect to the conservation of energy is not applicable to the company. However the company continued its conscious efforts to minimize energy consumption and more and more innovations and improvements were introduced to further reduce the energy consumption.

B. TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION RESEARCH AND DEVELOPMENT (R&D):

The Company has set up a separate R&D department with a mandate to take care of Continuous enhancement in

- efficiency

- product range

- protection of intellectual property rights

Due to sustained efforts of R&D department the Company was able to develop new design of vermibed and much films.

Filing of patents for several products developed in past years is in advance stage.

Specific areas in which R&D carried out by the company

The company continued its efforts towards the extension of the product range, lowering costs, process improvements &upgradation, installation of energy efficient equipments.

Benefits derived

- Quality improvement

- Development of in-house skills to manufacture high value added products

- Higher customer satisfaction

- Cost reduction

- Product range extension to reach newer markets

Future Plan of action

- To upgrade the existing technology

- To achieve higher customer satisfaction

- To reduce energy consumption

- To file patents for product already developed. Expenditure on R&D: Rs.4.26Lacs

TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION:

The company also continued to use the latest technologies for improving the productivity and quality of the products manufactured. The company is employing indigenous technology for its operations.

FOREIGN EXCHANGE EARNING AND OUTGO

The company has earned foreign exchange of Rs. 4996.79 Lacs during the year. The details of foreign exchange outgo are as follows:

Material import : Rs.512.32 lacs

Stores & spares : Rs. 4.66 lacs

Capital goods : Rs. 695.06 lacs

Expenditure in foreign currency : Rs. 3.53 lacs

PARTICULARS OF EMPLOYEES

The information required under Sec 217(2A) of the Companies Act 1956 is not given as there was no employee in receipt of remuneration during the year, exceeding the limits prescribed by the Companies (Particulars of Employees) Rules, 1975 as revised.

DEPOSITS

The company has not accepted any deposit from the public attracting the provisions of Sec 58Aof the Companies Act 1956.

DIRECTORS

Shri Shrawan Kumar Patodi and Shri Dashrath Bhai Trivedi retire by rotation and being eligible offer themselves for reappointment.

AUDITORS

M/s. A.P. Garg & Co., Chartered Accountants hold office until the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment. They have furnished a certificate to the effect that their appointment if made, would be within the prescribed limits under Sec 224(1 B) of the Companies Act 1956.

AUDITORS REPORT

Report of the auditors and their observations and notes to the accounts of the company for the year under review are attached herewith which are self-explanatory and do not require further explanation.

ACKNOWLEDGEMENT

Your Directors provide their gratitude to the various Government Agencies, Banks and financial institutions, investors, Companys business associates, customers, suppliers and other service providers for their continued support.

Your Directors place on record their sincere appreciation of the contributions made by the employees of the Company and its subsidiaries at all level through their hard work, dedication and support in ensuring an excellent all around operational performance.

Your Directors expresses its appreciation of the understanding and support extended by the shareholders of the Company for the confidence reposed on the management of the Company.

Date: 15th October 2010 Forand on behalfofthe Board of Directors

Place: Indore (K.S.TRIVEDI)

CHAIRMAN

 
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