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Directors Report of Oriental Carbon & Chemicals Ltd.

Mar 31, 2015

TO THE MEMBERS

The Directors hereby present their Thirty Fifth Report along with the Audited Annual Financial Statements (including Audited Consolidated Financial Statements) of the Company for the Financial Year ended March 31, 2015.

1. FINANCIAL RESULTS (Rs. Lakhs)

Particulars For the Year ended 31.3.2015 31.3.2014

Net Sales/Income from Operations 2,82,57.35 2,61,69.57

Other Income 12,86.13 3,49.00

Total Revenue 2,95,43.48 2,65,18.57

Profit/(Loss) Before Taxation 62,96.21 50,15.50

Provision for Taxation (11,64.61) (9,71.59)

Profit/(Loss) after Taxation 51,31.60 40,43.91

Amount Available for Appropriation 1,82,36.57 1,44,48.18

Appropriation:

Interim/Proposed Dividend on Equity Shares 8,75.17 7,20.72

Tax on Dividend 1,77.04 1,22.49

Transferred to General Reserve - 500.00

Balance Carried to Balance Sheet 1,71,84.36 1,31,04.97

Including Rs. 2,67.12 Lakhs Deferred Tax (Previous year Rs. 2,14.26 Lakhs)

2. DIVIDEND

Your Directors are pleased to recommend Final Dividend of 55% on 10296062 Equity Shares (Rs.5.5 per share of Rs.10 each). The Dividend will absorb Rs.6,81.57 Lakhs (Inclusive of Dividend Tax of Rs.1,15.28 Lakhs). With this, the total dividend for the year including interim dividend of 30% comes to 85%.

3. OPERATIONS Insoluble Sulphur

During the year, Company's Gross Revenue from Insoluble Sulphur increased by 5% over the previous year driven by growth in domestic as well as export sales. Export sales quantity increased by 10% as compared to last year on account of increased off take by existing customers and addition of some new customers. The growth rate in domestic volumes was 6% only as the tyre industry in India was in the grip of slowdown and demand picked up late in the second half of the year. The increase in production was 14% over previous year. Contribution levels were also maintained on account of better capacity utilization of Mundra Plant and optimization of utility consumption.

Sulphuric Acid & Oleum

Sulphuric Acid and Oleum sales also registered 40% growth over previous year due to better market conditions. Production of Sulphuric Acid (Eqvt.) was 32% higher than previous year. This was due to debottlenecking of the Plant in the previous year.

FUTURE PROSPECTS Insoluble Sulphur

Production from both the Plants have now been fully tied up and it is expected that the Company will be able to utilise its installed capacities at the optimum levels. Demand of Insoluble Sulphur in India is expected to grow in

double digits on the back of increased use of Radial Tyres in Commercial Vehicles which consumes more Insoluble Sulphur. Global Demand continues to grow at 3-4% per annum resulting in positive outlook. In order to expand its customer base and geographical footprints, the Company is exploring capacity expansion at Mundra. The Future prospects are discussed in greater detail in the management discussion and analysis annexed to this report.

Sulphuric Acid & Oleum

The prospects of Sulphuric Acid and Oleum, being commodity products remain same. The pricing trend is determined by one dominate manufacturer for whom Sulphuric Acid is a by-product. However, as the full steam requirement of Insoluble Sulphur Plant is now met by Sulphuric Acid Plant, the plant continues to be viable.

4. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has in place an established internal control system designed to ensure proper recording of financial and operational information, compliance of various internal controls and other regulatory and statutory compliances. Self certification exercise is also conducted by which senior management certifies effectiveness of the internal control system of the Company. Internal Audit is conducted throughout the organization by qualified outside Internal Auditors. Findings of the Internal Audit Report are reviewed by the top Management and by the Audit Committee of the Board and proper follow up action are ensured wherever required. The Statutory Auditors have evaluated the system of internal controls of the Company and have reported that the same are adequate and commensurate with the size of the Company and nature of its business.

5. CHANGE IN THE NATURE OF BUSINESS

There was no change in the nature of the business of the Company during the year. The Company has only one subsidiary, namely Schrader Duncan Limited (SDL) and there was no change in the nature of the business of this Subsidiary. There were no significant and material orders passed by regulators or courts or tribunals impacting the going concern status and Company's operations in future. There were no material changes and commitments affecting the financial position of the Company occurring between March 31, 2015 and the date of this report.

6. RESEARCH & DEVELOPMENT

Research & Development is fundamental to the Company's efforts to maintain the technical and quality edge for the product. A full in-house Research & Development team works on continuous basis to improve the quality of product and its properties. New Grades are also being developed to meet customers varied requirements. Research in the areas of reducing utilities cost and process parameters improvement is also being done. Help of accredited independent laboratories is also taken as and when required for studying and evolving critical parameters.

The Company's Research and Development unit is approved from Department of Scientific and Industrial Research, Ministry of Science and Technology Government of India.

The focus on R&D has increased during the year. The R&D lab has been augmented by acquiring state of the art analytical and process equipments to help in faster and detailed analysis. Further, pilot plants, as required, are being set up to validate the research findings. The details of some specific R&D activities carried out and benefits derived out of them have been annexed to this report.

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

As required under Section 134(3) (m) of the Companies Act, 2013 read with Rule8 (3) of the Companies (Accounts) Rules 2014, the information relating to conservation of energy, technology absorption and foreign exchange earnings and outgo is annexed to this Report.

8. POLLUTION CONTROL

Your Company's Plants have all the requisite Pollution Control Equipments and meets all the desired and statutory norms in this regard. The Insoluble Sulphur Units of the Company enjoys ISO-TS 16949:2009, EMS14001-2004 and OHSAS18001:2007 Certification.

9. STATUTORY AUDITORS AND AUDIT REPORT

Messrs Singhi & Co., Chartered Accountants, were appointed as Auditors of the Company for tenure of three years i.e. from the conclusion of 34th Annual General Meeting till the conclusion of the 37th Annual General Meeting of the Company. However, this appointment is subject to ratification by members at every Annual General Meeting held after appointment during their tenure of office. The Auditors have confirmed their eligibility and qualification under Section 141 of Companies Act 2013 and therefore, their ratification for appointment as Statutory Auditors for the year 2015-16 is being sought from the Members of the Company at the ensuing AGM. As regards the comments in the Auditors' Report, the relevant notes in the Accounts are self explanatory and may be treated as information/ explanation submitted by the Board as contemplated under provisions of the Companies Act, 2013.

10. SECRETARIAL AUDIT

In compliance with the provisions of Sec 204 and other applicable provisions of Companies Act 2013, a secretarial audit was conducted during the year by Secretarial Auditors M/s. S.Rath & Company. The Secretarial Auditor's Report is attached as annexure and form part of this report. There are no qualifications or observations or remarks made by the Secretarial Auditors in their Audit Report.

11. COST AUDIT

In compliance with the Central Government's order, your Board has appointed Messrs. J K Kabra & Co., Cost Accountants, to carry out the Cost Audit of the Company in respect of Chemicals for the financial year 2014-15. The Cost Audit Report for the year ended 31st March, 2014 has been submitted to the Ministry of Corporate Affairs.

12. PUBLIC DEPOSITS

Fixed Deposits from public outstanding with your Company at the end of the financial year stood at Rs. 4,94,02,000/-. Of this, deposit amounting to Rs. 10,000/- which had fallen due for payment on 7th May, 2003 has since been claimed by the depositor on 5th May, 2010. However, the same could not be paid as the depositor has failed to produce the Original Deposit Receipt in respect thereof. Deposits aggregating to Rs.14,94,000/- due for repayment on or before 31st March, 2015 were not claimed by the depositors by the said date. Out of these, deposits totalling Rs. 14,000/- have since been claimed and settled. This apart, deposits amounting to Rs. 12,95,000/- though fallen due for payment, could not be settled as there is a dispute between the concerned joint depositors and the matter is sub-judice.

13. DIRECTORS' RESPONSIBILITY STATEMENT

To the best of your Director's knowledge and belief and according to the information and explanations obtained your Directors make the following statements in terms of section 134 (3)(c) of the Companies Act, 2013:

i) that in the preparation of the annual financial statements for the year ended March 31, 2015, the applicable accounting standards have been followed along with proper explanation relating to material departures, if any;

ii) the directors had selected such accounting policies and applied them consistently and made judgements 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 the profit and loss of the Company for that period.

iii) that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv) that the annual financial statements have been prepared on a going concern basis;

v) that proper financial controls were in place and that the financial controls were adequate and were operating effectively.

vi) that systems to ensure compliance with the provisions of all applicable laws were in place and were adequate and operating effectively.

14. AUDIT COMMITTEE

The Audit Committee of the Board of Directors of the Company consists of Mr O.P Dubey as Chairman, Mr. B.B Tandon, Mr. Suman J Khaitan as Members. The Company Secretary is the Secretary of the Committee. The Managing Director, Chief Financial Officer and Auditors are permanent invitees to the committee meetings. The detail of terms of reference of Audit Committee, number and dates of meetings held, attendance of the directors and remunerations paid to them are given separately in the attached Corporate Governance Report. Your Company has a well structured Internal Audit System commensurate with its size and operations. During the year there were no instances where the Board had not accepted the recommendations of the Audit Committee.

15. STAKE HOLDER'S RELATIONSHIP COMMITTEE

The Company has a Stake Holder's Relationship Committee for reviewing shareholders/investors complaints. The present members of this Committee are Mr J.P Goenka (Chairman), Mr. Arvind Goenka (Member) and Mr. Suman J Khaitan (Member). The detail of number and dates of meetings held attendance of the directors and remunerations paid to them are given separately in the attached Corporate Governance Report.

16. CORPORATE SOCIAL RESPONSIBILITY COMMITTEE

The Corporate Social Responsibility Committee was constituted on 29th May, 2014 with Mr. Suman J Khaitan as Chairman, Mr. K Raghuraman and Mr. Arvind Goenka as members. The detail of terms of reference, number and dates of meetings held, attendance of the directors and remunerations paid to them are given separately in the attached Corporate Governance Report.

The Company recognizes that an effective practice of CSR is required giving due consideration to the welfare of the community, environment and social structure that it operates in and that of the country including focus welfare areas identified by the Sate and Central Government. CSR Committee of the Company has laid down the policy to meet the Corporate Social Responsibility objectives of the Company.

The CSR Policy includes any activity prescribed as CSR activity as per the Rules of Companies Act 2013. The main Focus areas taken in the policy are Education, Health care and family welfare, Environmental Safety, contribution to any relief fund setup by the Government of India and any State Government.

The details of amount of Rs. 90.00 lakhs spent zon CSR activities and projects undertaken during the year are given in the annexure to the Directors Reports.

The detailed CSR policy of the Company is available on the website of the Company which is www.occlindia.com.

17. NOMINATION AND REMUNERATION COMMITTEE

The Nomination and Remuneration Committee has Mr. O.P. Dubey as Chairman, Mr. B.B Tandon and Mr. K Raghuraman as members. The detail of terms of reference of this Committee, number and dates of meetings held attendance of the directors and remunerations paid to them and the brief outline of the Remuneration policy of the company are given separately in the attached Corporate Governance Report. The approved Remuneration Policy of the company is also available on the website of the Company which is www.occlindia.com.

18. BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out an annual performance evaluation of its own performance, the directors individually as well as the evaluation of the working of its Audit, Nomination and Remuneration and other Committees. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report. The Independent Directors are regularly updated on industry and market trends, plant and process and operational performance of the Company through presentations in this regard and periodic plant visits. They are also periodically kept aware of the latest developments in the Corporate Goverence, their duties as directors and relevant laws.

19. DIRECTORS

Mr. J P Goenka retires by rotation at the forthcoming Annual General Meeting and, being eligible, offers himself for re-appointment.

The term of Mr. Arvind Goenka, Managing Director of the Company, is expiring on 30th September, 2015. The Board has extended his term for a period of three years subject to your approval and such other approvals as may be required. Details of the proposal of his re-appointment are mentioned in the Explanatory Statement under Section 102 of the Companies Act, 2013 of the Notice of 35th Annual General Meeting. Mrs. Runa Mukherjee was appointed by the Board of Directors by resolution of circulation on 16th March, 2015. Mrs. Mukherjee holds office as an Additional Director of the Company upto the date of the ensuing Annual General Meeting. The Company has received a notice pursuant to Section 160 of the Companies Act, 2013 along with prescribed deposit from a member of the Company signifying his intention to propose the candidature of Mrs. Runa Mukherjee for the Office of the Director of the Company.

As per Section 149, 150, 152, 161 and any other applicable provisions of the Companies Act, 2013 and the rules made thereunder, your Directors are seeking reappointment of Mrs. Runa Mukherjee as an Independent Director of the Company to hold office for five consecutive years for a term upto the conclusion of 40th Annual General Meeting of the Company in the calendar year 2020. Details of the proposal of appointment of Mrs. Runa Mukherjee are mentioned in the Explanatory Statement under Section 102 of the Companies Act, 2013 of the Notice of 35th Annual General Meeting. Her appointment is appropriate and in the best interest of the Company.

Mr. Akshat Goenka, Vice President was appointed by the Board of Directors as an Additional Director of the Company with effect from 14th May, 2015. The Directors are seeking appointment of Mr. Akshat Goenka as a Whole Time Director, retiring by rotation, designated as 'Joint Managing Director' for a period of three years w.e.f. 1st June, 2015. Details of the proposal of appointment of Mr. Akshat Goenka are mentioned in the Explanatory Statement under Section 102 of the Companies Act, 2013 of the Notice of 35th Annual General Meeting. His appointment is appropriate and in the best interest of the Company.

The independent directors of the Company have confirmed and declared that they are not disqualified to act as an Independent Director in compliance with the provisions of Sec 149 of the Companies Act 2013 and the Board is also of the opinion that independent directors fulfill all the conditions specified in the Companies Act 2013 making them eligible to act as independent directors.

20. PARTICULARS OF EMPLOYEES AND KEY MANAGERIAL PERSONNEL (KMP)

The following three persons are the Key Managerial Personnel of the Company as per the provisions of Sec 203 of the Companies Act, 2013.

a) Mr. Arvind Goenka, Managing Director

b) Mr. Anurag Jain, Chief Financial Officer

c) Mr. Pranab Maity, Company Secretary

Pursuant to Sec 134(3) (q) read with Rule 5 of Companies (appointment and Remuneration of Managerial Personnel) Rules 2014, The Remuneration and other details of Key Managerial Personnel and other Employees for the year ended March 2015 are annexed to this report.

21. PARTICULARS OF LOANS, GUARANTEES OR INVESTMENTS

Details of Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013 are given in the notes to the financial Statements

22. RELATED PARTY TRANSACTIONS

All related party transactions that were entered into during the financial year were on arms' length basis and were in the ordinary course of business. There are no materially significant related party transactions made by the Company with promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of Company at large. All related party transactions are placed before the Audit Committee and given in the notes annexed to and forming part of this Financial Statement. The approved policy on related party transactions is also available on the website of the Company www.occlindia.com.

23. SUBSIDIARY

The Company has only one subsidiary, namely Schrader Duncan Limited (SDL). A statement containing financial details of the subsidiary is included in the Annual Report.

As required under the Listing Agreements entered into with the Stock Exchanges, a consolidated financial statements presented by the Company in this Report include the financial results of the subsidiary company duly audited by the statutory auditors. The said statements have been prepared in accordance with the relevant accounting standards as prescribed under the Companies Act, 2013.

24. VIGIL MECHANISM POLICY

The Company has a Vigil Mechanism Policy to deal with instance of fraud and mismanagement, if any. The details of the Vigil Mechanism Policy is explained in the Corporate Governance Report and also posted on the website of the Company.

25. EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in Form MGT 9 is annexed to this report.

26. RISK MANAGEMENT

As a policy the Company has identified key risk concern/areas. The assessment of each risk area has been done on quarterly basis. Following are of the concern areas of the Company:

Market Related Risk: related to mainly demand, realisation and redundancy of the product.

Production related Risk: related to mainly availability of inputs, accident or break down in the plant and rejection of material by the customers.

Human Resources Risk includes the risk of labour unrest, high employee turnover ratio and lower productivity due to dissatisfaction of employees.

Revenue Risk: adverse exchange rate movement.

The Board and the Audit Committee takes note of the Risk management of the Company in every quarter.

The Risk Assessment is also discussed in the Management Discussion and Analysis attached to this report.

27. NUMBER OF MEETINGS OF THE BOARD

During the year four Board Meetings and four Audit Committee Meetings were convened and held. The details of which are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.

28. CORPORATE GOVERNANCE

a) As per the amended Listing Agreement with the Stock Exchanges, a Management Discussion & Analysis, a Report on Corporate Governance together with the Auditors' certificate regarding the Compliance of conditions of Corporate Governance forms part of the Annual Report.

b) The Board of Directors of the Company has laid down a comprehensive Code of Conduct for all its Board members and senior management personnel which have also been posted on the website of the Company. A certificate by the Managing Director regarding compliance of the code of conduct of the Company is also included in the Annual report.

29. ACKNOWLEDGMENTS

The Board places on record its appreciation of the support and assistance of various Banks, Government Agencies, Suppliers, valued Customers and the shareholders in particular and looks forward to their continued support. Relations between your Company and its employees remain cordial and the Directors wish to express their appreciation for the co-operation and dedication of all employees of the Company.

By Order of the Board

Place : New Delhi J.P. Goenka Date : 14th May, 2015 Chairman


Mar 31, 2014

TO THE MEMBERS

The Directors hereby present their thirty fourth Reports together with the Audited Accounts of the Company for the accounting year ended March 31, 2014.

1. FINANCIAL RESULTS (Rs. in Lacs)

For the For the Year ended Year ended 31.3.2014 31.3.2013

profit/(Loss) Before Taxation 50,15.50 40,03.51

Provision for Taxation * (9,71.59) (12,65.06)

profit/(Loss) after Taxation 40,43.91 27,38.45

Amount Available for Appropriation 1,44,48.18 1,14,04.98

Appropriation:

Interim/Proposed Dividend on Equity Shares 7,20.72 5,14.80

Tax on Dividend 1,22.49 85.91

Transferred to General Reserve 5,00.00 4,00.00

Balance Carried to Balance Sheet 1,31,04.97 1,04,04.27

* Including Rs. (2,14.26) Lacs Deferred Tax (Previous year Rs.9,89.09 Lacs)

2. DIVIDENDS

Your Directors are pleased to recommend Final Dividend of 50% on 10296062 Equity Shares (Rs.5 per share of Rs.10 each). The Dividend will absorb Rs.6,02.29 Lacs (Inclusive of Dividend Tax of Rs.87.49 Lacs). With this, the total dividend for the year including interim dividend of 20% comes to 70%.

3. OPERATIONS Insoluble Sulphur

During the year total sales of Insoluble Sulphur was 19224 MT and Production of Insoluble Sulphur was 18733 MT which is 13% and 5% higher respectively than the previous year. Export sales volume registered 14% growth as compared to last year mainly due to demand increase in some areas and entry into new markets. Domestic sales also increased 12% over previous year. Per MT sales realisation also improved due to better exchange rate.

Sulphuric Acid & Oleum

Production of Sulphuric Acid (Eqvt.) was 31860 MT which is 17% lower than previous year and Oleum production was at 3589 MT 28% lesser than last year. On the same line sales of Sulphuric Acid was at 27233 MT 17% lower than last year. Sales of Oleum was at 3483 MT which is 28% lower than the last year. During the year two months shutdown was taken for annual maintenance, modernization of plant and capacity increase resulting in lower production and sales.

After the modifications, total steam requirement of both the Insoluble Sulphur Plants at Dharuhera is now being met from surplus steam generated by the Sulphuric Acid Plant resulting in reduction in Boiler Steam generation.

FUTURE PROSPECTS Insoluble Sulphur

With approvals now available for full capacities of the plants, sales during the next year is expected to be good and the Company is planning for further expansion of its Insoluble Sulphur Capacities. The Market has moved decisively to High Grade (Highly Stable and Highly Dispersible) Insoluble Sulphur and your Company is striving to shift all its production to these High Performance Insoluble Grades. The future prospects are discussed in greater detail in the Management Discussion and Analysis annexed to this report.

Sulphuric Acid & Oleum

The market prospects of Sulphuric Acid and Oleum remain the same as these are commodity products with price being directed by one dominant manufacturer in the area for whom Sulphuric Acid is a byproduct. However with increase in Surplus Steam for supply to Insoluble Sulphur Plant, the unit remains viable.

4. RESEARCH & DEVELOPMENT

A full in-house Research & Development team works on continuous basis to improve the quality of product and its properties. New Grades are also being developed to meet customers varied requirements. Research in the areas of reducing utilities cost and process parameters improvement is also being done. Help of accredited independent laboratories is also taken as and when required for studying and evolving critical parameters. Research & Development is fundamental to the Company''s efforts to maintain the technical and quality edge for the product.

During the year your Company''s Research and Development unit has got approval from Department of Scientific and Industrial Research, Ministry of Science and Technology Government of India. The focus on R&D has increased during the year. The R&D lab is being augmented by acquiring State of the Art analytical and process equipments to help in faster and detailed analysis. Further, pilot plants are also being set up to validate the research fndings.

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

As required under Section 217(1)(e) of the Companies Act, 1956 read with Rule 2 of the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, the information relating to conservation of energy, technology absorption and foreign exchange earnings and outgo is annexed to this Report.

6. POLLUTION CONTROL

Your Company''s Plant has all the requisite Pollution Control Equipments and meets all the desired and statutory norms in this regard. The Insoluble Sulphur Units of the Company enjoys ISO 14001-2004 certification.

7. COST AUDIT

In compliance with the Central Government''s order, your Board has appointed Messrs. J K Kabra & Co., Cost Accountants, to carry out the Cost Audit of the Company in respect of Sulphuric Acid for the financial year 2013-14. The Cost Audit Report for the year ended 31st March, 2013 has been submitted to Ministry of Corporate Affairs.

8. PUBLIC DEPOSITS

Fixed deposits from public outstanding with your Company at the end of the financial year stood at Rs.4,98,82,000/-. Of this, deposit amounting to Rs.10,000/- which had fallen due for payment on 7th May, 2003 has since been claimed by the depositors on 5th May, 2010. However, the same could not be paid as the depositor has failed to produce the Original Deposit Receipts in respect thereof. Deposits aggregating to Rs.20,36,000/- due for repayment on or before 31st March, 2014 were not claimed by the depositors by the said date. Out of these, deposits totaling Rs.3,70,000/- have since been claimed and settled. This apart, deposits amounting to Rs.12,95,000/- though fallen due for payment, could not be settled as there is a dispute between the concerned joint depositors and the matter is sub-judice.

9. DIRECTORS'' RESPONSIBILITY STATEMENT

As required under Section 217 (2AA) of the Companies Act, 1956, your Directors, based on representation received from operating Management, state that:

i) in the preparation of the Annual Accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures in the financial statement;

ii) the accounting policies have been selected and applied consistently and judgments and estimates have been reasonably and prudently made when required 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;

iii) proper and suffcient 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 fraud and other irregularities; and

iv) Annual accounts for the financial year have been prepared on a going concern basis.

10. AUDIT & INVESTORS/SHAREHOLDERS GRIEVANCE COMMITTEE

Your Company has a well structured Internal Audit System commensurate with its size and operations. An Audit Committee consisting of three independent non-executive Directors is in place with terms of reference as per the provisions of the Companies Act, 1956 and Listing Agreement with the Stock Exchanges.

The Company also has a Committee of Directors for reviewing shareholders/investors complaints.

11. DIRECTORS

The Board of Directors at their meeting held on 11th November, 2013 appointed Mr. H S Shashikumar as a Nominee Director of the Company in place of Mr. S K Roy, who has resigned from the Board w.e.f. 26th July, 2013. Mr. Shashikumar holds office up to the date of forthcoming Annual General Meeting of the Company and is eligible for re-appointment.

The Board has placed on record its deep appreciation for the valuable contribution made by Mr. S.K Roy during his tenure of directorship in the company.

Impending notifcation of Section 149 of the Companies Act, 2013, your Directors are seeking appointment Mr. S J Khaitan, Mr. B B Tandon. Mr. O P Dubey and Mr. K Raghuraman as Independent Directors for five consecutive years for a term upto 29th July, 2019. Details of the proposal for appointment and brief profle of Mr. Tandon, Mr. Khaitan, Mr. Dubey and Mr. Raghuraman are mentioned in Explanatory Statement under

Section 102 of the Companies Act, 2013 of the Notice of the 34th Annual General Meeting

12. SUBSIDIARY

The Company has only one subsidiary, namely Schrader Duncan Limited (SDL). A statement containing brief financial details of the subsidiary is included in the Annual Report.

As required under the Listing Agreements entered into with the Stock Exchanges, a consolidated financial statements presented by the Company in this Report include the financial results of the subsidiary company duly audited by the statutory auditors. The said statements have been prepared in accordance with the relevant accounting standards as prescribed under Section 211(3C) of the Companies Act, 1956. In terms of General Circular No. 2/2011 dated February 8, 2011 issued by the Ministry of Corporate Affairs, Government of India, granting general exemption to attach the Subsidiaries'' Annual Accounts, as required under section 212(8) of the Act, the Report and Audited Accounts of the subsidiary company viz. Schrader Duncan Limited are not annexed to this Report. However, the financial information of the subsidiary company is disclosed in this Report along with the Consolidated Financial Statements in compliance with the said circular. The Company will make available the Annual Accounts of subsidiary company and the related detailed information to any shareholder of the Company who may be interested in obtaining the same at any point of time. The annual accounts of the subsidiary company shall also be kept open for inspection by any shareholder at the Registered office of the Company and that of the subsidiary company.

13. AUDITORS AND AUDIT REPORT

Messrs Singhi & Co., Chartered Accountants, retire at the ensuing Annual General Meeting and are eligible for re-appointment. As regards the comments in the Auditors'' Report, the relevant notes in the Accounts are self explanatory and may be treated as information/ explanation submitted by the Board as contemplated under Section 217(3) of the Companies Act, 1956.

14. CORPORATE GOVERNANCE

a) As per the amended Listing Agreement with the Stock Exchanges, a Management Discussion & Analysis, a Report on Corporate Governance together with the Auditors'' certifcate regarding the Compliance of conditions of Corporate Governance forms part of the Annual Report.

b) The Board of Directors of the Company has laid down a comprehensive Code of Conduct for all its Board members and senior management personnel which have also been posted on the website of the Company. A certifcate by the Managing Director regarding compliance of the code of conduct of the Company is also included in the Annual report.

15. PARTICULARS OF EMPLOYEES

In compliance with the Provision of Section 217(2) (A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 as amended, a statement giving the required information relating to the employee is annexed to this report.

16. ACKNOWLEDGMENTS

The Board places on record its appreciation of the support and assistance of various Banks, Government Agencies, Suppliers, valued Customers and the shareholders in particular and looks forward to their continued support. Relations between your Company and its employees remain cordial and the Directors wish to express their appreciation for the co-operation and dedication of all employees of the Company.

By Order of the Board

Place : New Delhi J.P. Goenka

Date : 29th May, 2014 Chairman


Mar 31, 2013

TO THE MEMBERS

The Directors hereby present their thirty third Report together with the Audited Accounts of the Company for the accounting year ended March 31, 2013.

1. FINANCIAL RESULTS

(Rs. in Lacs)

For the For the Year ended Year ended 31.3.2013 31.3.2012

Proft/(Loss) Before Taxation 40,03.51 44,49.79

Provision for Taxation * (12,65.06) (13,04.03)

Proft/(Loss) after Taxation 27,38.45 31,45.76

Amount Available for Appropriation 1,14,04.98 96,64.83

Appropriation:

Interim/Proposed Dividend on Equity Shares 5,14.80 5,14.80

Tax on Dividend 85.91 83.50

Transferred to General Reserve 4,00.00 4,00.00

Balance Carried to Balance Sheet 1,04,04.27 86,66.53

* Including Rs. (989.09) Lakhs Deferred Tax (Previous year Rs.10.99 Lakhs)

2. DIVIDENDS

Your Directors are pleased to recommend Final Dividend of 30% on 10296062 Equity Shares (Rs.3 per share of Rs.10 each). The Dividend will absorb Rs.3,61.38 Lakhs (Inclusive of Dividend Tax of Rs.52.50 Lakhs. With this, the total dividend for the year including interim dividend of 20% comes to 50%.

3. OPERATIONS Insoluble Sulphur

During the year total production of Insoluble Sulphur was 17918 MT out of which 11070 Mt was from Dharuhera plant and 6848 Mt was from Mundra Plant. Commercial Production from Phase-II of Mundra plant started in May 2012. However, total production of Insoluble Sulphur was higher by only 3% from last year. Total Sales during the year was 16951 MT including 6317 MT from Mundra Plant. The sales of Insoluble Sulphur was 3% lower than the previous year due to lower demand. The low sales was a result of global as well Indian tyre plants cutting production due to slowdown in Indian as well as global economy. Further, due to lower demand, the impetus for tyre companies to speedily approve our new plants and products was absent resulting in delayed approvals. Though PMT Sales realisation improved during the year, proftability was lower due to higher input costs and higher fxed costs as the expenditure of the full Mundra Unit was charged post declaration of commercial productions of both the Phases.

Sulphuric Acid & Oleum

Production of Sulphuric Acid (Eqvt.) was at 38275 MT which is 6% higher than the last year production of 35991 MT. Production of Oleum was 37% higher than last year. However sales of Sulphuric Acid at 32850 MT was at par with the previous year sales of 32748 MT. Sales of Oleum was at 4866 MT which is 28% higher than the last year. Both demand and realization were good during the year resulting in the better results for the year from Sulphuric Acid Business.

4. FUTURE PROSPECTS Insoluble Sulphur

Demand from tyre companies continue to be sluggish due to global economic factors. Domestic tyre companies are also taking production cuts due to signifcant reduction in the tyre demand. Your Company is making all efforts to mitigate the situation by entering new geographical markets and customers. Consequently it is expected that sales should rise to optimum levels during the second half of 2013-14.

Sulphuric Acid & Oleum

Due to increase in Sulphuric Acid capacities of Zinc and copper plants, the availability of Sulphuric Acid has increased resulting in over supply in the region. This can result in prices for Sulphuric Acid as well as Oleum being under pressure during the next year.

5. RESEARCH & DEVELOPMENT

A full in-house Research & Development team works on continuous basis to improve the quality of product and its properties. New Grades are also being developed to meet customer''s varied requirements. Research in the areas of reducing utilities cost and process parameters improvement is also being done. Help of accredited independent laboratories is also taken as and when required for studying and evolving critical parameters. Research & Development is fundamental to the Company''s efforts to maintain the technical and quality edge for the product.

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

As required under Section 217(1)(e) of the Companies Act, 1956 read with Rule 2 of the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, the information relating to conservation of energy, technology absorption and foreign exchange earnings and outgo is annexed to this Report.

7. POLLUTION CONTROL

Your Company''s Plant has all the requisite Pollution Control Equipments and meets all the desired and statutory norms in this regard. The Insoluble Sulphur Units of the Company enjoy ISO 14001-2004 Certifcation.

8. COST AUDIT

In compliance with the Central Government''s order, your Board has appointed Messrs. J K Kabra & Co., Cost Accountants, to carry out the Cost Audit of the Company in respect of Sulphuric Acid. This appointment has to be made in each fnancial year and based on the application of your Company the Central Government has approved the re-appointment of Cost Auditor for the year under review. The Cost Audit Report for the year ended 31st March, 2012 has been submitted to Ministry of Corporate Affairs.

9. PUBLIC DEPOSITS

Fixed deposits from public, outstanding with your Company at the end of the fnancial year, stood at Rs.5,37,95,000/-. Of the above, deposit amounting to Rs.10,000/- which had fallen due for payment on 7th May, 2003 and Rs. 45,000/- which had fallen due for payment on 2nd November, 2005 have since been claimed by the depositors on 5th May, 2010 and 14th August, 2012 respectively, but the same could not be paid as the depositors have failed to produce the Original Deposit Receipts in this respect. Deposits aggregating to Rs.21,22,000/- due for repayment on or before 31st March, 2013 were not claimed by the depositors by said date. Out of these, deposits totaling Rs.2,10,000/- have since been claimed and settled. This apart, deposits amounting to Rs.12,95,000/- though fallen due for payment, could not be settled as there is a dispute between the concerned joint depositors and the matter is sub-judice.

10. DIRECTORS'' RESPONSIBILITY STATEMENT

As required under Section 217 (2AA) of the Companies Act, 1956, your Directors, based on representation received from operating Management, state that:

i) in the preparation of the Annual Accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures in the fnancial statement;

ii) the accounting policies have been selected and applied consistently and judgments and estimates have been reasonably and prudently made when required so as to give a true and fair view of the state of affairs of the Company at the end of the fnancial year and of the proft and loss of the Company for that period;

iii) proper and suffcient 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 fraud and other irregularities; and

iv) Annual accounts for the fnancial year have been prepared on a going concern basis.

11. AUDIT & INVESTORS/SHAREHOLDERS GRIEVANCE COMMITTEE

Your Company has a well structured Internal Audit System commensurate with its size and operations. An Audit Committee consisting of three independent non-executive Directors is in place with terms of reference as per the provisions of the Companies Act, 1956 and Listing Agreement with the Stock Exchanges.

The Company also has a Committee of Directors for reviewing shareholders/investors complaints.

12. DIRECTORS

Mr. J P Goenka and Mr. K Raghuraman retire by rotation and, being eligible, offer themselves for re-election. Brief resumes of Mr. J P Goenka and Mr. K Raghuraman are given in Point No. 6 of the Report on Corporate Governance attached to this report.

13. SUBSIDIARY

The Company has one subsidiary, namely Schrader Duncan Limited (SDL). A statement containing brief fnancial details of the subsidiary is included in the Annual Report.

As required under the Listing Agreements entered into with the Stock Exchanges, a consolidated fnancial statements presented by the Company in this Report include the fnancial results of the subsidiary company duly audited by the statutory auditors. The said statements have been prepared in accordance with the relevant accounting standards as prescribed under Section 211(3C) of the Act.

In terms of General Circular No. 2/2011 dated February 8, 2011 issued by the Ministry of Corporate Affairs, Government of India, granting general exemption to attach the Subsidiaries'' Annual Accounts, as required under section 212(8) of the Act, the Report and Audited Accounts of the subsidiary company viz. Schrader Duncan Limited are not annexed to this Report. However, the fnancial information of the subsidiary company is disclosed in this Report along with the Consolidated Financial Statements in compliance with the said circular. The Company will make available the Annual Accounts of subsidiary company and the related detailed information to any shareholder of the Company who may be interested in obtaining the same at any point of time. The annual accounts of the subsidiary company shall also be kept open for inspection by any shareholder at the Registered Offce of the Company and that of the subsidiary company.

14. AUDITORS AND AUDIT REPORT

Messrs Singhi & Co., Chartered Accountants, retire at the ensuing Annual General Meeting and are eligible for re-appointment. As regards the comments in the Auditors'' Report, the relevant notes in the Accounts are self explanatory and may be treated as information/ explanation submitted by the Board as contemplated under Section 217(3) of the Companies Act, 1956.

15. CORPORATE GOVERNANCE

a) As per the amended Listing Agreement with the Stock Exchanges, a Management Discussion & Analysis, a Report on Corporate Governance together with the Auditors'' certifcate regarding the Compliance of conditions of Corporate Governance forms part of the Annual Report.

b) The Board of Directors of the Company has laid down a comprehensive Code of Conduct for all its Board members and senior management personnel which have also been posted on the website of the Company. A certifcate by the Managing Director regarding compliance of the code of conduct of the Company is also included in the Annual report.

16. PARTICULARS OF EMPLOYEES

In compliance with the Provision of Section 217(2) (A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 as amended, a statement giving the required information relating to the employee is annexed to this report.

17. ACKNOWLEDGMENTS

The Board places on record its appreciation of the support and assistance of various Banks, Government Agencies, Suppliers, valued Customers and the shareholders in particular and looks forward to their continued support. Relations between your Company and its employees remain cordial and the Directors wish to express their appreciation for the co-operation and dedication of all employees of the Company.

By Order of the Board

O.P Dubey Arvind Goenka Director Managing Director

Place : New Delhi

Date : 29th May, 2013


Mar 31, 2012

The Directors hereby present their thirty second Report together with the Audited Accounts of the Company for the accounting year ended March 31, 2012.

1. FINANCIAL RESULTS (Rs. Lakhs)

For the For the Year ended Year ended 31.3.2012 31.3.2011

Profit/(Loss) Before Taxation 44,49.79 43,61.16

Provision for Taxation for Current year* (13,05.01) (6,22.99)

Profit/(Loss) after Taxation for Current year 31,44.78 37,39.75

Tax Adjustment for earlier years (0.98) 1.82

Profit/(Loss) after Taxation for earlier years 31,45.76 37,37.93

Amount Available for Appropriation 96,64.83 73,98.52

Appropriation:

Interim/Proposed Dividend on Equity Shares 5,14.80 4,11.84

Tax on Dividend 83.50 67.61

Transferred to General Reserve 4,00.00 4,00.00

Balance Carried to Balance Sheet 86,66.53 65,19.07

* Including Rs. (10.99) Lakhs Deferred Tax (Previous year Rs.(36.83) Lakhs)

2. DIVIDENDS

Your Directors are pleased to recommend Final Dividend of 30% on 10296062 Equity Shares (Rs.3 per share of Rs.10 each). The Dividend will absorb Rs.3,58.99 Lakhs (Inclusive of Dividend Tax of Rs.50.10 Lakhs).

3. OPERATIONS

Insoluble Sulphur

During the year total production of Insoluble Sulphur was 17392 MT. Commercial Production from Phase-1 of Mundra plant started in August 2011 and a production of 2983 MT was achieved during the year. The total production of Insoluble Sulphur from Dharuhera operations was 14409 MT registering 6% growth from last year. Total Sales during the year was 17417 MT including 2660 MT from Mundra Plant. The demand from both international & domestic market continued to be healthy. The net profit during the year is less as the Income Tax Exemption on the Company's EOU Plant has expired resulting in tax on its income during the year.

Sulphuric Acid & Oleum

Production of Sulphuric Acid (Eqvt.) was at 35991 MT which is 6% lower than the last year production of 38402 MT. Production of Oleum was 36% lower than last year. This was mainly due to new capacities coming up in the region without any increase in demand. However, sales of Sulphuric Acid at 32748 MT was at par with the previous year sales of 32312 MT. Sales of Oleum was at 3805 MT which is 32% lower than the last year due to competition in the market from new suppliers.

4. FUTURE PROSPECTS

Insoluble Sulphur

The demand of Insoluble Sulphur was stable in international as well as the domestic market during the year. The prospect of economic slowdown being faced worldwide is expected to have adverse effect on the tyre industry as well which is the main consumer of Insoluble Sulphur. However since your Company is currently having a good order book and by virtue of having long term supply contracts the impact of the same is expected to be significantly less on the Company.

After successful completion of Phase-1 of the new plant of Insoluble Sulphur at Mundra SEZ, the work on Phase-II for another 5500 capacity addition has also been completed. The commercial production of the same has been declared in the month of May-2012.

Sulphuric Acid & Oleum

Demand of Sulphuric Acid is expected to remain at the existing levels in the near future. However, due to consumption of steam produced by it in Insoluble Sulphur Plants, the division is expected to remain profitable in the coming year.

5. RESEARCH & DEVELOPMENT

A fully in-house Research & Development team works on continuous basis to improve the quality of product and its properties. New Grades are also being developed to meet customers varied requirements. Your Company is currently working on development of pre-dispersed Insoluble Sulphur which will be a value added form of Insoluble Sulphur. Help of accredited independent laboratories is also taken as and when required for studying and evolving critical parameters. Research & Development is fundamental to the Company's efforts to maintain the technical and quality edge for the product.

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

As required under Section 217(1)(e) of the Companies Act, 1956 read with Rule 2 of the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, the information relating to conservation of energy, technology absorption and foreign exchange earnings and outgo is annexed to this Report.

7. POLLUTION CONTROL

Your Company's Plants have all the requisite Pollution Control Equipments and meets all the desired and statutory norms in this regard. The Insoluble Sulphur Units of the Company enjoys ISO 14001-2004 Certification.

8. COST AUDIT

Department of Company Affairs has approved the appointment of M/s.J K Kabra and Co., Cost Auditors, for conducting Audit in respect of Sulphuric Acid Unit for the year ending March 2013.

9. PUBLIC DEPOSITS

Fixed deposits from public outstanding with your Company, at the end of the financial year, stood at Rs.3,88,41,000/-. Of the above, deposit amounting to Rs. 10,000/- which had fallen due for payment on 7th May, 2003 has since been claimed by the depositor on 5th May, 2010, but the same could not be paid as the depositor has not been able to produce the Original Deposit Certificate in this respect. Deposits aggregating to Rs. 17,53,000/- due for repayment on or before 31st March, 2012 were not claimed by the depositors. Out of these, deposits totalling Rs. 1,82,000/- have since been claimed and settled. Besides this, deposits amounting to Rs. 12,95,000/- though fallen due for payment could not be settled as there is a dispute between the concerned joint depositors and the matter is sub-judice.

10. DIRECTORS' RESPONSIBILITY STATEMENT

As required under Section 217 (2AA) of the Companies Act, 1956, your Directors, based on representation received from operating Management, state that:

i) in the preparation of the Annual Accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures in the financial statement;

ii) the accounting policies have been selected and applied consistently and judgments and estimates have been reasonably and prudently made when required 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;

iii) 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 fraud and other irregularities; and

iv) Annual accounts for the financial year have been prepared on a going concern basis.

11. AUDIT & INVESTORS/SHAREHOLDERS GRIEVANCE COMMITTEE

Your Company has a well structured Internal Audit System commensurate with its size and operations. An Audit Committee consisting of three independent non-executive Directors is in place with terms of reference as per the provisions of the Companies Act, 1956 and Listing Agreement with the Stock Exchanges.

The Company also has a Committee of Directors for reviewing shareholders/investors complaints.

12. DIRECTORS

Mr. B B Tandon and Mr. O P Dubey retire by rotation and, being eligible, offer themselves for re-election. The term of Mr. Arvind Goenka, Managing Director, is expiring on 30th September 2012. The Board has extended his term for a period of three years subject to your approval and such other approvals as may be required.

13. SUBSIDIARY

In the month of April 2012, your Company has acquired 50% of the total paid up equity shares of Schrader Duncan Limited from M/S Schrader Bridgeport International Inc, SDL's foreign promoters. Due to this acquisition Schrader Duncan Limited has become a subsidiary of your Company in the year 2012-13.

14. AUDITORS AND AUDIT REPORT

Messrs Singhi & Co., Chartered Accountants, retire at the ensuing Annual General Meeting and are eligible for re-appointment. As regards the comments in the Auditors' Report, the relevant notes in the Accounts are self explanatory and may be treated as information/ explanation submitted by the Board as contemplated under Section 217(3) of the Companies Act, 1956.

15. CORPORATE GOVERNANCE

a) As per the amended Listing Agreement with the Stock Exchanges, a Management Discussion & Analysis, a Report on Corporate Governance together with the Auditors' certificate regarding the Compliance of conditions of Corporate Governance forms part of the Annual Report.

b) The Board of Directors of the Company has laid down a comprehensive Code of Conduct for all its Board members and senior management personnel which have also been posted on the website of the Company. A certificate by the Managing Director regarding compliance of the code of conduct of the Company is also included in the Annual report.

16. PARTICULARS OF EMPLOYEES

In compliance with the Provision of Section 217(2) (A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 as amended, a statement giving the required information relating to the employee is annexed to this report.

17. ACKNOWLEDGMENTS

The Board places on record its appreciation of the support and assistance of various Banks, Government Agencies, Suppliers, valued Customers and the shareholders in particular and looks forward to their continued support. Relations between your Company and its employees remain cordial and the Directors wish to express their appreciation for the co-operation and dedication of all employees of the Company.

By Order of the Board

Place: New Delhi O.P. DUBEY ARVIND GOENKA

Date: 30th May, 2012 Director Managing Director


Mar 31, 2011

The Directors hereby present their thirty-first Report together with the Audited Accounts of the Company for the accounting year ended March 31, 2011.

1. FINANCIAL RESULTS (Rs. Lakhs)

For the For the Year ended Year ended 31.3.2011 31.3.2010

Profit/(Loss) Before Taxation 43,62.74 34,27.21

Provision for Taxation for Current year* (6,22.99) (4,81.52)

Profit/(Loss) after Taxation for Current year 37,39.75 29,45.69

Tax Adjustment for earlier years 1.82 0.00

Profit/(Loss) after Taxation for earlier years 37,37.93 29,45.69

Add: Surplus Brought Forward 36,59.99 14,94.93

Transfer from Capital Reserve Account 0.60 0.60

Amount Available for Appropriation 73,98.52 44,41.22

Appropriation:

Interim/Proposed Dividend on Equity Shares 4,11.84 4,11.84

Tax on Dividend 67.61 69.39

Transferred to General Reserve 4,00.00 3,00.00

Balance Carried to Balance Sheet 65,19.07 36,59.99 * Including Rs. (36.83) Lakhs Deferred Tax (Previous year Rs. 49.65 Lakhs.)

2. DIVIDENDS

Your Directors are pleased to recommend Final Dividend of 20% on 10296062 Equity Shares (Rs.2 per share of Rs.10 each). The Dividend will absorb Rs.2,39.33 Lakhs (Inclusive of Dividend Tax of Rs. 33.41 Lakhs).

3. OPERATIONS

Insoluble Sulphur

During the year your Company achieved 17% growth in production to 13621 MT as compared to 11696 MT last year. 10% growth was also registered in sales volumes on the back of global demand to 13796 MT against last year sales of 12506 MT. This was due to robust Global Demand and the fact that many major global tyre companies have identifed the Company as a strategic supplier. The Sales were constrained by production ca- pacities which augers well for the upcoming project. During the year, Raw Material prices witnessed gradual increase over the year.

Sulphuric Acid & Oleums

Production of Sulphuric Acid (Eqvt.) was at 38402 MT which is 8% higher than the last year production of 35638 MT. However, Oleum Production was 10% lower than the last year production. During this year sales of Sulphuric Acid was higher by 11% at 32312 MT and Oleum was at 5625 MT which is 16% lower than the last year sales. Price of Sulphuric Acid remained remunerative during the year on back of stable demand.

4. FUTURE PROSPECTS

Insoluble Sulphur

The demand of Insoluble Sulphur has picked up in international as well as the domestic market and the trend is expected to continue.

The work on a new plant for Insoluble Sulphur at SEZ Mundra to increase the capacity by 11000 Mtpa in two phases is on track.The first phase for 5500 MT is expected to be commissioned in June-2011. Production from this phase is already sold out subject to technical approvals. Accordingly, the second phase of 5500 Mtpa has been brought forward and orders for major machinery have been placed. The second phase is now targeted to be commissioned in the fourth quarter of 2011-12.

Sulphuric Acid & Oleums

Sale of Sulphuric Acid in 2011-12 is being affected by low off take in the first quarter, which is traditionally a good period for it. Therefore, margins are expected to be under pressure in 2011-12. Off take of Oleum has decreased due to addition of capacities in the region without increase in demand.

5. RESEARCH & DEVELOPMENT

A fully in-house Research & Development team works on continuous basis to improve the quality of product and its properties. New Grades are also being developed to meet customers varied requirements. Your Company is currently working on development of pre-dispersed Insoluble Sulphur which will be a value added form of Insoluble Sulphur. Help of accredited independent laboratories is also taken as and when required for studying and evolving critical parameters. Research & Development is fundamental to the Companys efforts to maintain the technical and quality edge for the product.

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

As required under Section 217(1)(e) of the Companies Act, 1956 read with Rule 2 of the Companies (Disclo- sure of Particulars in the Report of Board of Directors) Rules, 1988, the information relating to conservation of energy, technology absorption and foreign exchange earnings and outgo is annexed to this Report.

7. POLLUTION CONTROL

Your Companys Plant has all the requisite Pollution Control Equipments and meets all the desired and statu- tory norms in this regard. The Insoluble Sulphur Units of the Company enjoys ISO 14001-2004 Certifcation.

8. COST AUDIT

Department of Company Affairs has approved the appointment of M/s.J K Kabra and Co., Cost Auditors, for conducting Audit in respect of Sulphuric Acid Unit for the year ending 31st March 2012.

9. PUBLIC DEPOSITS

Fixed deposits from public, outstanding with your Company at the end of the financial year, stood at Rs.19221000/-. Of the above, deposit amounting to Rs. 10000/-which had fallen due for payment on 7th May,2003 has since been claimed by the depositors on 5th May,2010 but the same could not be paid as the depositor has not been able to produce the Original Deposit Certifcate in this respect. Deposits aggregating Rs.1789000/- due for repayment on or before 31st March, 2011 were not claimed by the depositors. Out of these, deposits totaling Rs.120000/- have since been claimed and settled. Besides this, deposits amounting to Rs.1295000/- though fallen due for payment, could not be settled as there is a dispute between the concerned joint depositors and the matter is sub-judice.

10. DIRECTORS RESPONSIBILITY STATEMENT

As required under Section 217 (2AA) of the Companies Act, 1956, your Directors, based on representation

received from operating Management, state that:

i) in the preparation of the Annual Accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures in the financial statement;

ii) the accounting policies have been selected and applied consistently and judgments and estimates have been reasonably and prudently made when required 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;

iii) proper and suffcient 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 pre- venting and detecting fraud and other irregularities; and

iv) Annual accounts for the financial year have been prepared on a going concern basis.

11. AUDIT & INVESTORS/SHAREHOLDERS GRIEVANCE COMMITTEE

Your Company has a well structured Internal Audit System commensurate with its size and operations. An Audit Committee consisting of three independent non-executive Directors is in place with terms of reference as per the provisions of the Companies Act, 1956 and Listing Agreement with the Stock Exchanges.

The Company also has a Committee of Directors for reviewing shareholders/investors complaints.

12. DIRECTORS

Mr. S.J Khaitan and Mr S.K Roy retire by rotation and, being eligible, offer themselves for re-election. Mr. H.C Taneja retired as Whole time Director of the Company on 15th Nov 2010 upon attaining the age of superannuation. The Board has placed on record its deep appreciation for the invaluable services rendered by Mr. Taneja throughout his tenure of directorship in the Company.

13. AUDITORS AND AUDIT REPORT

Messrs Singhi & Co., Chartered Accountants, retire at the ensuing Annual General Meeting and are eligible for re-appointment. As regards the comments in the Auditors Report, the relevant notes in the Accounts are self explanatory and may be treated as information/ explanation submitted by the Board as contemplated under Section 217(3) of the Companies Act, 1956.

14. CORPORATE GOVERNANCE

a) As per the amended Listing Agreement with the Stock Exchanges, a Management Discussion & Analysis, a Report on Corporate Governance together with the Auditors certifcate regarding the Compliance of conditions of Corporate Governance forms part of the Annual Report.

b) The Board of Directors of the Company has laid down a comprehensive Code of Conduct for all its Board members and senior management personnel which have also been posted on the website of the Company. A certifcate by the Managing Director regarding compliance of the code of conduct of the Company is also included in the Annual report.

15. PARTICULARS OF EMPLOYEES

In compliance with the Provision of Section 217(2) (A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 as amended, a statement giving the required information relating to the employee is annexed to this report.

16. ACKNOWLEDGMENTS

The Board places on record its appreciation of the support and assistance of various Banks, Government Agencies, Suppliers, valued Customers and the shareholders in particular and looks forward to their continued support. Relations between your Company and its employees remain cordial and the Directors wish to express their appreciation for the co-operation and dedication of all employees of the Company.

By Order of the Board

Place : New Delhi J.P Goenka

Date : 27th May, 2011 Chairman


Mar 31, 2010

The Directors hereby present their thirtieth Report together with the Audited Accounts of the Company for the accounting year ended March 31, 2010.

1. FINANCIAL RESULTS (Rs. Lakhs) For the For the Year ended Year ended 31.3.2010 31.3.2009

Profit/(Loss) Before Taxation 3427.21 813.34

Provision Cor Taxation for Current year* (481.52) (50.41)

Profit/(I.oss) after Taxation for Current year 2945.69 762.93

Tax Adjustment for earlier years 0.00 0.24

Profit/(Loss) after Taxation for earlier years 2945.69 762.69

Add: Surplus Brought Forward 1494.93 1312.33

Transfer from Capital Reserve Account 0.60 0.60

Amount Available for Appropriation 4441.22 2075.62

Appropriation:

Interim/Proposed Dividend on Kquity Shares 411.84 154.44

lax on Dividend 69.39 26.25

Transferred to General Reserve - 400.00

Balance Carried to Balance Sheet 3959.99 1494.33

* Including Rs. 49.65 I.akhs Deferred Tax (Previous year Rs. (59.02) Lakhs.

2. DIVIDENDS

Your Directors are pleased to recommend Pinal Dividend of 15% on 10296062 Hquity Shares (Rs. 1.5 per share of Rs.10 each). The Dividend will absorb Rs. 180.09 Lakhs (Inclusive of Dividend Tax of Rs. 25.65 Lakhs).

3. OPERATIONS

Insoluble Sulphur

During the year your Company achieved 9% growth in production to 11696 MT as compared to 10703 Ml last year. Your Company registered to 27% growth in sales on the back of revival in global demand to 12506 MT against last year salesof 9822 MT. After turbulent and high prices of Raw Material last year, the prices of Raw Material remained relatively stable during the year. The selling price has also reflected this easing of prices. I lowever margin levels remained robust.

Sulphuric Acid & Oleums

Production of Sulphuric Acid (Hqvt.) was at 35638 MT which is 8% higher than the last year production of 32970 Ml. I lowever Oleum Production was 14 % lower than the last year production. During this year sales of Sulphuric Acid was higher by 17% at 29043 MT and Oleum was at 6731 MT which is in line with the last year sales. Price of Sulphuric Acid remained stable during the current year after recovery from sharp lluctuations during the last year.

4. FUTURE PROSPECTS

Insoluble Sulphur

The demand of Insoluble Sulphur has picked up in international as well as the domestic market and the trend is expected to continue.

The debottlenecking exercise has added another 2000 MTPA to the capacity of Insoluble Sulphur. However,

willi additionof new custorncrs/plants and economic revival, (he current capacity is already sold out. The work on a new plant for Insoluble Sulphur at SKZ Mundra to increase the capacity by 11000 MTPA in two phases is on track and the first phase for 5500 MT is expected to be completed by 2"(l quarter of 2011. Land has already been acquired, civil work has commenced and order for long delivery items have been placed.

Sulphuric Acid & Volumes

Economic revival has given a boost to Sulphuric Acid demand and the prices are expected to remain remunerative in the coming year.

5. RESEARCH & DEVELOPMENT

A fully in-house Research & Development team works on continuous basis to improve the quality of product and its properties. New (trades are also being developed to meet customers varied requirements. Help of accredited independent laboratories is also taken as and when required for studying and evolving critical parameters. Research & Development is fundamental to the Companys efforts to maintain the technical and quality edge for the product.

6. CONSERVATIONS OF ENERGY & TECHNOLOGY ABSORBTION AND FOREIGN EXCHANGES & OUTGO

As required under Section 217(1 )(e) of the Companies Art, 1956 read with Rule 2 of the Companies (Disclosure of Particulars in the Report of Hoard of Directors) Rules, 1988, the information relating to conservation of energy, technology absorption and foreign exchange earnings and outgo is annexed to this Report.

7. POLLUTION CONTROL

Your Companys Plant has all the requisite Pollution Control Equipments and meets all the desired and statutory norms in this regard. The Insoluble Sulphur Units of the Company enjoys ISO 14001-2004 Certification.

8. COST AUDIT

The Department of Corporate A Hairs has approved the appointment of M/s. J K Kabra and Co., Cost Auditors, for conducting Audit in respect of Sulphuric Acid Unit for the year ending March 2011.

9. PUBLIC DEPOSITS

Fixed deposits from public, outstanding with your Company at the end of the financial year, stood at Rs. 1,66,70,000/-. Deposits aggregating Rs. 19,58,000/- due for repayment on or before 31 si March, 2010 were not claimed by the depositors. Out of these, deposits totaling Rs.78,000/- have since been claimed and settled. Besides, this, deposits amounting to Rs. 12,95,000/- though fallen due for payment, could not be settled as there is a dispute between the concerned joint depositors and the matter is sub-judice.

Ml. DIRECTORS RESPONSIBILITY STATEMENT

As required under Section 217 (2AA) of the Companies Act, 1956, your Directors, based On representation

received from operating Management, state that:

i) in the preparation of the Annual Accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures in the financial statement;

ii) the accounting policies have been selected and applied consistently and judgments and estimates have been reasonably and prudently made when required 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;

iii) 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 fraud and other irregularities; and

iv) Annual accounts for the financial year have been prepared on a going concern basis.

11. AUDIT & INVESTORS/SHAREHOLDERS GRWVANCE COMMITTEE

Your Company has a well structured Internal Audit System commensurate with its si/.e and operations. An Audit Committee consisting of three independent non-cxccutivc Directors is in place with terms of reference as per the provisions of the Companies Act, 1956 and Listing Agreement with the Stock Exchanges.

The Company also has a Committee of Directors for reviewing sharehol -ders/investors complaints.

12. DIRECTORS

Mr. J.P Goenka and Mr K Raghuraman retire by rotation and, being eligible, offer themselves for re-election. Mr. Arvind Goenka has been appointed by the Hoard of Directors as the Managing Director of the Company for a period of three years with effect from Isl October, 2009 subject to your approval and the requisite approval of the Central Government, if required, and such other approvals as may be necessary.

13. AUDITORS AND AUDI I REPORT

Messrs Singhi & Co., Chartered Accountants, retire at the ensuing Annual General Meeting and are eligible for re-appointment. As regards the comments in the Auditors Report, the relevant notes in the Accounts are self explanatory and may be treated as information/ explanation submitted by the Hoard as contemplated under Section 217(3) of the Companies Act, 1956.

14. CORPORATE GOVERNANCE

a) As per the amended Listing Agreement with the Stock Lxchangcs, a Management Discussion & Analysis, a Report on Corporate Governance together with the Auditors certificate regarding the Compliance of conditions of Corporate Governance forms part of the Annual Report.

b) The Hoard of Directors of the Company has laid down a comprehensive Code of Conduct for all its Hoard members and senior management personnel which have also been posted on the website of the Company. A certificate by the Managing Director regarding compliance of the code of conduct of the Company is also included in the Annual report.

15. PARTICULARS OK EMPLOYEES

In compliance with the Provision of Section 217(2) (A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 as amended, a statement giving the required information relating to the employees is annexed to this report.

16. ACKNOWLEDGMENTS

The Hoard places on record its appreciation of the support and assistance of various Hanks, Government Agencies, Suppliers, valued Customers and the shareholders in particular and looks forward to their continued support. Relations"betwecn your Company and its employees remain cordial and the Directors wish to express their appreciation for the co-operation and dedication of all employees of the Company.

By Order of the Board

Place : New Delhi J.P. Goenka

Date :28,th May, 2010 Chairman

 
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