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Directors Report of Paramount Communications Ltd.

Mar 31, 2015

Dear Members,

The directors hereby present the 21st Annual Report along with audited statement of accounts of the Company for the year ended 31st March, 2015.

1. FINANCIAL RESULTS

The financial performance of the Company for the year ended 31st March, 2015 is summarised below:

(Rs.Lac)

Year ended Year ended 31.03.2015 31.03.2014

Gross Turnover including Other Income 49,856.26 45,397.83

Profit/ (Loss) before Interest, Depreciation and Tax (3,544.94) (2,269.39)

Interest 5,829.13 3,593.49

Depreciation & Amortisation of FCMITDA 929.70 1,092.73

Profit/(Loss) before Tax (10,303.77) (6,954.61)

Exceptional Items (10.07) (3,391.28)

Provision for Taxation - -

Profit/(Loss) after Tax and Exceptional Items (10,313.84) (10,345.89)

Taxation for earlier years - 2.55

Net Profit/(Loss) for the year (10,313.84) (10,343.34)

The Company achieved gross turnover including other income of '49,856.26 Lac and incurred a net loss of Rs. 10,313.84 Lac for the financial year 2014-2015 as against gross turnover including other income of Rs. 45,397.83 Lac and net loss of 10,343.34 Lac in financial year 2013-2014. Losses before exceptional items have been Rs. 10,303.77 Lac as against net loss of Rs. 6,954.61 Lac during previous year 2013-2014.

2. DIVIDEND

In view of losses incurred by the Company during the current financial year, your directors do not recommend declaration of any dividend for the year 2014-2015.

3. MATERIAL CHANGES AND COMMITMENTS, IF ANY, AFFECTING THE FINANCIAL POSITION OF THE COMPANY

There are no material changes and commitments affecting the financial position of the Company which have occurred between the end of the financial year of the Company which the financial statement relates and the date of the report.

4. FOREIGN CURRENCY CONVERTIBLE BONDS (FCCBs)

Outstanding FCCBs amounting to US$ 7.5 million were due for redemption on 23rd November, 2011 at a premium equal to 145.54% of the outstanding principal amount i.e. @ US$ 7,277. Pending redemption, a winding up petition has been filed against the Company by the trustees on behalf of FCCB holders. However, in the hearing held on 16.12.2014, the High Court of Delhi and Hon'ble Company Court set aside the liquidation orders pronounced by the same court, in view of reference of the Company registered with BIFR. The Company Court also directed the petitioner viz. Bank of New York (BONY) to take any further action, as may be deemed fit by them, only after seeking prior permission of the BIFR for initiation of such proceedings. Therefore, the winding up petition preferred by trustees on behalf of FCCB holders was set aside. Status quo is being maintained as no further action has been initiated by BONY for any further proceedings.

The Bonds are listed at Luxembourg Stock Exchange.

5. GLOBAL DEPOSITORY RECEIPTS (GDRs)

The Global Depository Receipts issued by the Company during the financial year 2006-2007 are listed at Luxembourg Stock Exchange. There are GDRs outstanding which represents 301,750 equity shares of Rs. 2/- each as on 31st March, 2015.

6. FUTURE OUTLOOK

During the year under review, your Company consolidated its position further in the industry through optimum capacity utilisation and new products launches as per evolving industrial standards. To keep abreast with the latest trends in the industry, your Company was also vigilant about technological upgradation of its production facilities, with the aim of improving assets performance and cost competitiveness.

The domestic Optical Fibre Cables industry is expected to grow at a good pace but competitive conditions are likely to persist over the medium-term in the Power Cable segment. The Company's focus in future, shall be to sustain momentum in the business segments namely, Optical Fibre and Copper Telecom Cables, power cables and railway signalling cables, etc. by leveraging its inherent strength of products development as per evolving industrial standards and superior project execution capabilities to drive both the short term and long term growth.

7. TRANSFER TO RESERVES

In view of losses incurred by the Company during the current financial year, your Company do not proposes to transfer funds to the General Reserves.

8. PUBLIC DEPOSITS

During the financial year 2014-2015, your Company has not accepted any deposits within the meaning of Sections 73 and 74 of the Companies Act, 2013 read with the Companies (Acceptance of Deposits) Rules, 2014.

9. BOARD OF DIRECTORS

In compliance with the provisions of Section 149, 152, Schedule IV and other applicable provisions, if any, of the Companies Act, 2013 read with Companies (Appointment and Qualification of Directors) Rules, 2014, Mr. S.PS. Dangi, Mr. Satya Pal and Mr. Vijay Bhushan were appointed as Independent Directors on the Board of Directors of your Company at the 20th Annual General Meeting held on 26th September, 2014, to hold office upto 5 (Five) consecutive years i.e. upto 31st March, 2019.

Further, in accordance with the provisions of the Section 152 of the Companies Act, 2013 read with Articles of Association of the Company, Mr. Sanjay Aggarwal, is liable to retire by rotation at the ensuing Annual General Meeting and being eligible, has offered himself for re-appointment. The Board recommends his re-appointment as a Director.

The Board of Directors of the Company in their meeting held on 30th January, 2015 appointed Mrs. Malini Gupta as an Additional Director. Pursuant to Section 161(1) of the Companies Act, 2013, she will hold the office as Director up to the date of the ensuing Annual General Meeting. The Company has received notice under Section 160 of the Companies Act, 2013 proposing her candidature as Director.

In terms of Section 149, 152, Schedule IV and other applicable provisions, if any, of the Companies Act, 2013 read with Companies (Appointment and Qualification of Directors) Rules, 2014, the independent directors of the Company will have to be appointed by the members for a term upto five years, and no independent director shall be liable to retire by rotation. Mrs. Malini Gupta has given declaration to the Company under Section 149(6) of the Companies Act, 2013 that she qualifies the criteria of independence. Accordingly, it is proposed to appoint her as an Independent Director not liable to retire by rotation for a term of five years upto 31st March, 2020.

In compliance with Clause 49 of the Listing Agreement, brief resume(s) of the director proposed to be appointed/ reappointed, the nature of their expertise in specific functional areas, names of the companies in which they hold directorships and memberships/chairmanships of Board Committees, shareholding and relationships between directors inter-se, are forming part of the Notice of Annual General Meeting.

10. DECLARATION OF INDEPENDENCE

Your Company has received declarations from all the Independent Directors confirming that they meet the criteria of independence as prescribed under the provisions of Companies Act, 2013 read with the Schedules and Rules issued thereunder as well as Clause 49 of the Listing Agreement.

11. DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the requirements of Section 134(3)(c) of the Companies Act, 2013 with respect to Directors' Responsibility Statement, your Directors hereby confirm that:

i) In the preparation of the annual accounts for the financial year ended 31st March, 2015, the applicable accounting standards have been followed along with proper explanation relating to material departure, if any;

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

iii) They had taken proper and sufficient care 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) They had prepared the annual accounts for the financial year ended 31st March, 2015 on a 'going concern' basis;

v) They had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively; and

vi) They had devised proper system to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

12. BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has formed a policy to carry out an annual performance evaluation of its own performance, the directors individually as well as the evaluation of the working of its Audit Committee, Nomination & Remuneration Committee, Stakeholders'/Investors' Grievance Committee, Risk Management Committee and Share Transfer & Transmission Committee.

13. REMUNERATION POLICY

The Nomination and Remuneration Committee recommend the appointment of Director, and there appointment or re-appointment, based on their qualifications, professional experience, positive attributes, view points, skills and area of expertise and independence.

14. KEY MANAGERIAL PERSONNEL

Mr. Sanjay Aggarwal, Chairman & CEO, Mr. Sandeep Aggarwal, Managing Director, Mr. Shambhu Kumar Agarwal, Chief Financial Officer and Ms. Tannu Sharma, Company Secretary are the Key Managerial Personnel of your Company under the provisions of Section 2(51) and Section 203 of the Companies Act, 2013 read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014.

15. DISCLOSURE OF RATIO OF REMUNERATION OF DIRECTORS AND KEY MANAGERIAL PERSONNEL ETC.

As required under Section 197(12) read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the details of the ratio of the remuneration of each director to the median employee's remuneration and such other details as prescribed therein are given in "Annexure-A", which is attached hereto and forms a part of the Directors' Report.

16. NUMBER OF MEETINGS OF THE BOARD AND AUDIT COMMITTEE

A calendar of Meetings is prepared and circulated in advance to the Directors. During the year, 6 (Six) Board Meetings and 5 (Five) Audit Committee Meetings were convened and held. The details of these meetings are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.

17. AUDITORS

M/s Jagdish Chand and Co., Chartered Accountants, New Delhi, (Firm Registration No. 000129N) the statutory auditors of the Company retire at the ensuing Annual General Meeting and being eligible offer themselves for re- appointment. The Audit Committee had recommended their re-appointment. The certificate from the Auditors have been received to the effect that their appointment, if made, would be within the prescribed limits under Section 141(3)(g) of the Companies Act, 2013.

18. AUDITORS REPORT-CLARIFICATIONS AND EXPLANATIONS

Auditors Report point No. 9 (a): Preparation of financial statements on going concern basis.

The accompanying financial statements have been prepared on a going concern basis despite negative net worth, overdue in redemption of Foreign Currency Convertible Bonds (FCCBs).

Your Company is confident that the Company will be able to generate profits in future years and meet its financial obligations. The management is also exploring inducting financial investor(s) in the Company and/or joint venture with foreign companies. The accompanying financial statements have been prepared on a going concern basis based on cumulative impact of the following mitigating factors:

* Company has no over dues in payment of statutory dues or its trade creditors etc.

* Company has again proposed the banks to reschedule term loans repayments.

* Company and promoters have undertaken to raise and had raised adequate finances by way of disposal of assets and induction of fresh funds by promoters and/or promoter group companies. The management is also exploring inducting financial investors in the Company and/or joint venture with foreign companies.

* Company has good order book position.

Auditors Report point No. 9 (b): Payment of interest on borrowings.

Interest on borrowing from banks has been provided based upon information available from banks and as per best estimates of the management.

19. COST AUDITORS

The Board of Directors had appointed M/s. Jain Sharma & Associates, Cost Accountants as the Cost Auditor of your Company for the financial year 2014-2015 to conduct the audit of the cost records of your Company.

As per Section 148 read with Companies (Audit and Auditors) Rules, 2014 and other applicable provisions, if any, of the Companies Act, 2013, the Board of Directors of the Company has appointed M/s. Jain Sharma & Associates, Cost Accountants as the Cost Auditor of the Company for the financial year 2015-2016 on the recommendations made by the Audit Committee. The remuneration proposed to be paid to the Cost Auditor, would be Rs. 50,000/- (Rupees Fifty Thousand only) and out of pocket expenses, plus taxes.

The Company has received a letter from their firm to the effect that their re-appointment would be within the limits prescribed under Section 141(3)(g) of the Companies Act, 2013 and that they are not disqualified for such re-appointment within the meaning of Section 141 of the Companies Act, 2013.

The Cost Audit involves audit of the cost records relating to 'Electric Cables and Conductors' maintained by the Company.

20. SECRETARIAL AUDIT

Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, M/s. A.K. Popli & Co., a firm of Company Secretaries in Practice, was appointed to conduct the secretarial audit of the Company for the financial year 2014-2015. The Secretarial Audit report for financial year 2014-2015 forms an integral part of the Annual Report as "Annexure-B" to the Board's Report. The Secretarial Audit Report does not contain any qualification, reservation or adverse remark.

21. SUBSIDIARIES

The Company does not have any Indian subsidiary Company. However, the Company has the following direct/ indirect wholly owned foreign subsidiaries:

1. Paramount Holdings Limited, Cyprus;

2. AEI Power Cables Limited, United Kingdom and

3. "06196375 Cables Limited" (formerly AEI Cables Limited), United Kingdom*

Consolidated financials include audited financials of Paramount Holdings Limited, Cyprus and AEI Power Cables Ltd., United Kingdom for the year ended 31st March, 2015.

*"06196375 Cables Limited" (formerly AEI Cables Limited), United Kingdom, a step down subsidiary of the Company, is under Administration w.e.f. 28th February, 2014.

The details pertaining to subsidiaries are mentioned under the statement made pursuant to Section 129 of the Companies Act, 2013, which forms a part of this Annual Report.

22. REPORTING TO BOARD FOR INDUSTRIAL AND FINANCIAL RECONSTRUCTION {BIFR}

Your Company has been registered with the Board for Industrial and Financial Reconstruction (BIFR) under Section 15(1) of Sick Industrial Companies (Special Provisions) Act, 1985 vide case no. 77/2013, order dated 31st October, 2013. BIFR has restrained Company from disposing of or alienating in any manner any fixed assets of the Company without consent of BIFR.

23. MEASURES TAKEN FOR REVIVAL AND REHABILITATION OF THE COMPANY

The Company has approached its bankers with restructuring request to convert the substantial part of loan into convertible securities. Apart from this the Company is exploring possibilities of new investors and joint venture with foreign companies.

The Company is also taking several measures to reduce its cost.

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

The particulars relating to conservation of energy, technology absorption, foreign exchange earnings and outgo, as per the requirements of Section 134(3)(m) of the Companies Act, 2013, read with the Companies (Accounts) Rules, 2014, are annexed hereto and forms an integral part of the report.

The Company constantly strives for maintenance and improvement in quality of its products and entire Research & Development activities are directed to achieve the aforesaid goal.

25. ISO CERTIFICATION

The Company holds ISO 9001:2008 and ISO 14001:2004 certifications for both of its plants at Khushkhera, Rajasthan and Dharuhera, Haryana.

26. PARTICULARS OF EMPLOYEES

The information required pursuant to Section 197 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, names and other particulars in respect of employees of the Company are required to be attached to the Directors' Report. In terms of Section 136 of the Act, the reports and accounts are being sent to the members and other entitled thereto, excluding the information on employees' particulars as there are no employees whose particulars are required to be disclosed in this report.

27. RELATED PARTY TRANSACTIONS

All related party transactions that were entered into during the financial year were on arm's length basis and were in the ordinary course of the business. There are no materially significant related party transactions made by the Company with Promoters, Key Managerial Personnel or other designated persons which may have potential conflict with interest of the Company at large.

During the year 2014-2015, pursuant to Section 177 of the Companies Act, 2013 and Clause 49 of the Listing Agreement, all Related Party Transactions were placed before the Audit Committee and also for the Board approval, wherever required. Prior/omnibus approval of the Audit Committee is generally obtained for the transactions which are of a foreseen and repetitive nature and these transactions are reviewed by the Audit Committee on quarterly basis.

The policy on Related Party Transactions as approved by Board is uploaded on the Company's website www.paramountcables.com.

The Form AOC-2 pursuant to Section 134(3)(h) of the Companies Act, 2013 read with Companies (Accounts) Rules, 2014 is set out as "Annexure-C" to this report.

28. LOANS, GUARANTEES OR INVESTMENTS

The Company has not given any loans or guarantees covered under the provisions of Section 186 of the Companies Act, 2013.

The details of the investments made by the Company are given in the notes to the financial statements.

29. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

The Company has an Internal Control System, commensurate with the size, scale and complexity of its operations. To maintain its objectivity and independence, the Internal Auditor reports to the Chairman of the Audit Committee and to the Chairman and Managing Director of the Board.

The Internal Audit Department monitors and evaluates the efficacy and adequacy of internal control system in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company. Based on the report of internal audit function, process owners undertake corrective action in their respective areas and thereby strengthen the controls. Significant audit observations and recommendations along with corrective actions thereon are presented to the Audit Committee and the Board.

30. PREVENTION OF INSIDER TRADING

The Company has adopted a Code of Conduct for Prevention of Insider Trading with a view to regulate trading in securities by the Directors and designated employees of the Company. The Code requires pre-clearance for dealing in the Company's shares and prohibits the purchase or sale of Company shares by the Directors and the designated employees while in possession of unpublished price sensitive information in relation to the Company and during the period when the Trading Window is closed. The Board is responsible for implementation of the Code.

All Directors and the designated employees have confirmed compliance with the Code.

31. EXTRACT OF ANNUAL RETURN

In accordance with Sections 134(3)(a) and 92(3) of the Companies Act, 2013 and Rule 12(1) of the Companies (Management and Administration) Rules, 2014, the details forming part of the extract of the Annual Return in Form MGT-9 is annexed herewith as "Annexure-D".

32. RISK MANAGEMENT

Your Company recognizes that risk is an integral part of business and is committed to managing the risks in a proactive and efficient manner. Your Company periodically assesses the risks in the internal and external environment, along with the cost of treating risks and incorporates risk treatment plans in its strategy, business and operational plans.

As per the requirements of Section 134(3)(n) of the Companies Act, 2013 and Clause 49 of the Listing Agreement, your Company has constituted a Risk Management Committee to oversee the risk management efforts in the Company. The details of the committee along with its charter are set out in the Corporate Governance Report forming part of this report.

There are some of the risks which may pose challenges are set out in the Management Discussion and Analysis which forms part of this report.

33. CODE OF CONDUCT

The Board of Directors has approved a Code of Conduct which is applicable to the Members of the Board and all employees in the course of day to day business operations of the Company. The Company believes in "Zero Tolerance" against bribery, corruption and unethical dealings/behaviours of any form and the Board has laid down the directives to counter such acts. The Code has been posted on the Company's website www.paramountcables.com.

The Code lays down the standard procedure of business conduct which is expected to be followed by the Directors and designated employees in their business dealings and in particular on matters relating to integrity in the work place, in business practice and in dealing with shareholders.

All the Board Members and the Senior Management Personnel have confirmed compliance with the Code. All Management staff were given appropriate training in this regard.

34. CORPORATE SOCIAL RESPONSIBILITY (CSR) POLICY

The Company is not required to make expenditure on CSR, hence no CSR committee as per the prescribed format under Companies (Corporate Social Responsibility Policy) Rules, 2014, has been formulated.

35. VIGIL MECHANISM/WHISTLE BOWLER POLICY

The Company has vigil mechanism policy to deal with instances of fraud and mismanagement, if any.

In staying true to our values of Strength, Performance and Passion and in line with our vision of being one of the most respected companies in India, the Company is committed to high standards of Corporate Governance and shareholders responsibility.

The policy ensures that strict confidentiality is maintained while dealing with concerns and also that no discrimination will be meted out to any person for a genuinely raised concern. Accordingly, the Board of Directors have formulated a Vigil Mechanism/Whistle Blower Policy which is in compliance with the provisions of Sections 177(9) and 177(10) of the Companies Act, 2013 and Clause 49 of the Listing Agreement. The policy is also available on the website of the Company www.paramountcables.com.

36. INSURANCE

All insurable interest of the Company including inventories, buildings and plant & machinery are adequately insured.

37. TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND

Pursuant to the provisions of Section 125 of the Companies Act, 2013 {Erstwhile Section 205C of the Companies Act, 1956} read with Companies (Declaration and Payment of Dividend) Rules, 2014, the Company has transferred 4,67,296/- to the Investor Education and Protection Fund. This amount was lying unclaimed/unpaid with the Company for a period of seven years after declaration of Dividend for the financial year ended 2006-2007.

38. LISTING OF SHARES

The equity shares of the Company are listed at The Bombay Stock Exchange Ltd. (BSE) and National Stock Exchange of India Ltd. (NSE). The BSE & NSE have nation-wide trading terminals and therefore provide full liquidity to investors. The Global Depository Receipts (GDRs) and Foreign Currency Convertible Bonds (FCCBs) issued by the Company in the international market are listed at Luxembourg Stock Exchange. Equity shares of the Company had also been listed with the Calcutta Stock Exchange Ltd. However, the Company has applied for delisting on 03.03.2004 and the application is still pending for disposal at the exchange.

39. INDUSTRIAL RELATIONS

Paramount is an equal opportunities employer. The Company do not discriminate on grounds of age, gender, colour, race, ethnicity, language, caste, creed, economic or social status or disability. The global workforce spreads across the continents forms the backbone of the entity. We handle global preferences and mindsets of both internal and external customers.

The Company humbly acknowledge employees contributions with best compensation and benefits that appropriately reward performance. Pay revisions and other benefits are designed in such a way to compensate good performance of the employees of the Company and motivate them to do better in future.

During the period under review, your Company enjoyed healthy, cordial and harmonious relationship with workers and employees at all levels. The enthusiasm and unstinting efforts of employees have enabled the Company to improve its position.

40. CORPORATE GOVERNANCE & MANAGEMENT DISCUSSION AND ANALYSIS REPORT

In compliance with the provisions of Clause 49 of the Listing Agreement, a separate section on Corporate Governance along with a certificate from the Auditors on its compliance, forms an integral part of this report. Further, Management Discussion and Analysis which includes detailed review of operations, performance and future outlook of the Company and its businesses forms a part of this report.

41. GENERAL

Your Directors state that no disclosure or reporting is required in respect of the following items as there were no transactions on these items during the year under review:

a) Issue of equity shares with differential rights as to dividend, voting or otherwise.

b) Issue of shares (including sweat equity shares) to employees of the Company under any scheme.

c) Neither the Managing Director nor the Whole Time Director of the Company receives any remuneration or commission from any of its subsidiaries.

d) No significant or material orders were passed by the Regulators or Courts or Tribunals which impact the going concern status and Company's operations in future.

e) During the year under review, there were no cases filed or reported pursuant to the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013.

42. ACKNOWLEDGEMENT AND APPRECIATION

Your Directors convey their thanks to customers, vendors, investors and banks for their continued support during the year. They also thank the various Central and State Government Departments, Organisations and Agencies for their continued help and all the co-operation extended by them.

Your Company has been able to operate efficiently because of the culture of professionalism, creativity, integrity and continuous improvement in all functions and areas as well as the efficient utilisation of the Company's resources.

The Directors wish to place on record their appreciation of the efficient and loyal services rendered by each and every employee, without whose whole-hearted efforts, the overall satisfactory performance would not have been possible.

Your Directors look forward to a long term future with confidence.



For and on behalf of the Board

Place: New Delhi (Sanjay Aggarwal) Date : 12.08.2015 Chairman & CEO




Mar 31, 2014

Dear Members,

The directors hereby present the 20th Annual Report along with audited statement of accounts of the Company for the year ended 31st March, 2014.

1. FINANCIAL RESULTS

The financial performance of the Company for the year ended 31st March, 2014 is summarised below:

(Rs in Lacs) Year ended Year ended 31.03.2014 31.03.2013

Gross Turnover including Other Income 45,397.83 51,755.11

Profit/(Loss) before Interest, (2,269.39) 502.62 Depreciation and Tax

Interest 3,592.49 3,998.96

Depreciation & Amortisation of FCMITDA 1,092.73 1,163.28

Profit/(Loss) before Tax (6,954.61) (4,659.62)

Exceptional Items (3,391.28) 4,200.85

Provision for Taxation — —

Profit/(Loss) after Tax and Exceptional Items (10,345.89) (458.77)

Taxation for earlier years 2.55 (5.54)

Net Profit/(Loss) for the year (10,343.34) (464.31)

The Company achieved gross turnover including other income of Rs.45,397.83 Lac and incurred net loss of Rs.10,343.34 Lac for the financial year 2013-2014 as against gross turnover including other income of Rs. 51,755.11 Lac and net loss of Rs.464.31 Lac in financial year 2012-2013. Losses before exceptional items have been Rs. 6,954.61 Lac as against net loss of Rs.4,659.62 Lac during previous year 2012-2013. The Company''s turnover declined by 13.25% in FY 2013-2014. During the year under review, the banks reduced their exposure and your Company faced tight funds position. There were delays in release of bulk orders for Optical Fibre Cables due to which performance of the Company has been affected badly in the financial year 2013-2014.

2. DIVIDEND

In view of losses incurred by the Company during the current financial year, your directors do not recommend declaration of any dividend for the year 2013-2014.

3. 0% NON-CONVERTIBLE REDEEMABLE PREFERENCE SHARES (NCRPS)

During the previous year, Company has issued 7,65,000 0% Non-Convertible Redeemable Preference Shares of Rs.100 each to the promoters and promoter group companies on 30.03.2013. During the year, a provision for redemption premium on prorata basis has been duly made in the books of accounts as on 31st March, 2014, amounting to Rs. 22,96,07,788/-.

4. FOREIGN CURRENCY CONVERTIBLE BONDS (FCCBs)

Outstanding FCCBs amounting to US$ 7.5 million were due for redemption on 23rd November, 2011 at a premium equal to 145.54% of the outstanding principal amount i.e. @ US$ 7,277. Pending redemption, a winding up petition has been filed against the Company by the trustees on behalf of FCCB holders. Your Company is contesting the case. The matter is presently subjudice.

The Bonds are listed at Luxembourg Stock Exchange.

5. GLOBAL DEPOSITORY RECEIPTS (GDRs)

The Global Depository Receipts issued by the Company during the financial year 2006-2007 are listed at Luxembourg Stock Exchange. There are GDRs outstanding which represents 301,750 equity shares of Rs.2/- each on at 31st March, 2014.

6. FUTURE OUTLOOK

The pace of anticipated investment in infrastructure, power, telecom, railways and industrial sector was affected in the past due to the loss in growth momentum resulting from global meltdown, financial crises reported world over during the last few financial years. The cable industry was also affected due to stiff competition among industry players. However, the growth seems to be regaining its momentum, the demand for the Company''s products is imporving.

The Company is focusing upon business segments which may give better price realization. The Government of India with an objective to connect 2.5 Lac villages across the country with Optical Fibre Cable (OFC) for offering broadband services came up with National Optical Fibre Project. Being an eminent player in the Optical Fibre telecom cables segment, your Company is privileged to become instrumental to serve the nation by being part of National Optical Fibre Project.

7. BOARD OF DIRECTORS

In accordance with the provisions of the Section 152 of the Companies Act, 2013 (Erstwhile Section 256 of Companies Act, 1956) read with Articles of Association of the Company, Mr. Sandeep Aggarwal, is liable to retire by rotation at the ensuing Annual General Meeting and being eligible offer himself for re-appointment.

In terms of Section 149, 152, Schedule IV and other applicable provisions, if any of the Companies Act, 2013 read with Companies (Appointment and Qualification of Directors) Rules, 2014, the independent directors of the Company will have to be appointed by the members for a term upto five consecutive years, and no independent director shall be liable to retire by rotation. Mr. S. P. S. Dangi, Mr. Satya Pal and Mr. Vijay Bhushan have given declaration to the Company under Section 149(6) of the Companies Act, 2013 that they qualify the criteria of independence. Accordingly, it is proposed to appoint them as Independent Directors not liable to retire by rotation for a term of five years upto 31st March, 2019.

Mr. Ram Kumar Sharma had been appointed by State Bank of India as Nominee Director. The Board of Directors at their meeting held on 14th September, 2013, appointed him as Non-Rotational Nominee Director under Section 161(3) of the Companies Act, 2013. However, the State Bank of India vide their letter dated 31.07.2014 have informed the Company that Mr. Ram Kumar Sharma has resigned from the Board of the Company. The Board placed on record its sincere appreciation for the contributions made by him during his tenure as Director of the Company.

In compliance with Clause 49 of the Listing Agreement, brief resume(s) of the directors proposed to be reappointed, the nature of their expertise in specific functional areas, names of the companies in which they hold directorships and memberships/ chairmanships of Board Committees, shareholding and relationships between directors inter-se, are forming part of the Notice of Annual General Meeting.

8. DIRECTORS'' RESPONSIBILITY STATEMENT

Pursuant to the requirements of Section 217(2AA) of the Companies Act, 1956 with respect to Directors'' Responsibility Statement, your Directors hereby confirm that:

i) In the preparation of the annual accounts for the financial year ended 31st March, 2014, the applicable accounting standards have been followed except as disclosed and explained in this report.

ii) They had selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit or loss of the Company for the year under review.

iii) They had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

iv) They had prepared the accounts for the financial year ended 31st March, 2014 on a ''going concern'' basis.

9. AUDITORS

M/s Jagdish Chand and Co., Chartered Accountants, New Delhi, (Firm Registration No. 000129N) the statutory auditors of the Company retire at the ensuing Annual General Meeting and being eligible offer themselves for re-appointment. The Audit Committee had recommended their re-appointment. The certificate from the Auditors have been received to the effect that their appointment, if made, would be within the prescribed limits under Section 141(3)(g) of the Companies Act, 2013 (Erstwhile Section 224(1)(B) of the Companies Act, 1956).

10. AUDITORS REPORT-CLARIFICATIONS AND EXPLANATIONS

Auditors Report point No. 7 (a): Preparation of financial statements on going concern basis.

The accompanying financial statements have been prepared on going concern basis despite negative net worth, defaults in repayment of loan installments and interest to banks and other working capital facilities from banks, default in redemption of Foreign Currency Convertible Bonds (FCCBs) and filing of winding up petition against the Company on behalf of FCCB holders.

Your Company is confident that it will be able to generate profits in future years and dispose-off non-core assets to meet its financial obligations as may arise. The accompanying financial statements have been prepared on a going concern basis based on cumulative impact of the following mitigating factors:

Company has not defaulted in payment of statutory dues or its trade creditors etc.

Company has again proposed banks to reschedule term loans repayments.

Company and promoters have undertaken to raise and have raised adequate finances by way of disposal of assets and induction of fresh funds by promoters and/or promoter group companies.

Company is contesting the winding up petition filed against it. The matter is presently subjudice.

Company has good order book position.

Auditors Report point No. 7 (b): Payment of managerial remuneration.

Managerial Remuneration of Rs.90,32,489/- and Rs.8,53,720/- to the Chairman & CEO and Managing Director of the Company for the year ended 31st March, 2014 and for March, 2013 respectively, is as approved by the shareholders by way of postal ballot. However, this is subject to final approval from the Central Government. Any change in terms of their appointments as directed by the Central Government at the time of giving approval shall be carried out accordingly.

11. COST AUDITORS

The Board of Directors of the Company has appointed M/s. Jain Sharma & Associates, Cost Accountants as Cost Auditors of the Company for the financial year 2014-2015 on recommendations made by the Audit Committee. The remuneration proposed to be paid to the Cost Auditor, would be Rs.45,000/- (Rupees Forty Five Thousand only) plus taxes.

The Cost Audit involves audit of the cost records relating to ''Electric Cables and Conductors'' maintained by the Company at its units situated at Khushkhera and Dharuhera.

During the year, the Cost Audit Report for both the units was filed with the Ministry of Corporate Affairs, Government of India in XBRL on 26.09.2013.

12. SUBSIDIARIES

The Company does not have any Indian subsidiary Company. However, the Company has the following direct/indirect wholly owned foreign subsidiaries:

1. Paramount Holdings Limited, Cyprus;

2. AEI Power Cables Limited, United Kingdom and

3. "06196375 Cables Limited" (formerly AEI Cables Limited), United Kingdom *

Consolidated financials include audited financials of Paramount Holdings Limited, Cyprus and AEI Power Cables Ltd., United Kingdom for the year ended 31st March, 2014.

"06196375 Cables Limited" (formerly AEI Cables Limited), United Kingdom, a step down subsidiary of the Company, is under Administration w.e.f. 28th February, 2014.

Particulars relating to subsidiary companies, as required under Section 212 of the Companies Act, 1956 are annexed herewith.

13. EXEMPTION U/S 212 FOR SUBSIDIARIES

The Company has availed exemption from attaching Balance Sheet, Profit & Loss Account, Directors'' Report, Auditors Report and such other documents of the subsidiary Companies as prescribed under Section 212(1) of the Companies Act, 1956 with its annual report. The exemption is being availed in terms of General Circular No. 2/2011 dated 8th February, 2011 issued by Ministry of Corporate Affairs granting general exemption under Section 212(8) of the Companies Act 1956.

Accordingly, the consolidated financials and gist of financial performance of subsidiaries are forming part of the present annual report. Further the annual accounts of the subsidiary Companies are kept open for inspection by any member/ investor during business working hours at the registered office of the Company and a copy of the same along with detailed information will be made available on demand of any member of the Company or any of its subsidiaries to that effect.

14. REPORTING TO BOARD FOR INDUSTRIAL AND FINANCIAL RECONSTRUCTION {BIFR}

Your Company has been registered with the Board for Industrial and Financial Reconstruction (BIFR) under Section 15(1) of Sick Industrial Companies (Special Provisions) Act, 1985 vide order dated 31st October, 2013. BIFR has restrained Company from disposing of or alienating in any manner any fixed assets of the Company without consent of BIFR.

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

The particulars relating to conservation of energy, technology absorption, foreign exchange earnings and outgo, as per the requirements of Section 217(1)(e) of the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, are annexed hereto and forms an integral part of the report.

16. ISO CERTIFICATION

The Company holds ISO 9001:2008 and ISO 14001:2004 certifications for both of its plants at Khushkhera, Rajasthan and Dharuhera, Haryana.

17. PARTICULARS OF EMPLOYEES

In terms of the provisions of Section 217(2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975 as amended, names and other particulars of employees are required to be attached to the Directors'' Report. There are no employees whose particulars are required to be disclosed in this report under Section 217(2A) of the said Act.

18. INSURANCE

All insurable assets of the Company including inventories, buildings and plant & machinery are adequately insured.

19. PUBLIC DEPOSITS

There are no deposits from public outstanding as on 31 st March, 2014.

20. TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND

Pursuant to the provisions of Section 205C of the Companies Act, 1956, the Company has transferred Rs.2,54,961/- to the Investor Education and Protection Fund. This amount was lying unclaimed/unpaid with the Company for a period of seven years after declaration of Dividend for the financial year ended 2005-2006.

21. LISTING OF SHARES

The equity shares of the Company are listed at The Bombay Stock Exchange Ltd. (BSE) and National Stock Exchange of India Ltd. (NSE). The BSE & NSE have nation-wide trading terminals and therefore provide full liquidity to the investors. The Global Depository Receipts (GDRs) and Foreign Currency Convertible Bonds (FCCBs) issued by the Company in the international market are listed at Luxembourg Stock Exchange. Equity shares of the Company had also been listed with the Calcutta Stock Exchange Ltd. However, the Company has applied for delisting on 03.03.2004 and the application is still pending for disposal at the exchange.

22. CORPORATE GOVERNANCE & MANAGEMENT DISCUSSION AND ANALYSIS

In compliance with Clause 49 of the Listing Agreement, a separate section on Corporate Governance along with the Auditors Certificate on its compliance form an integral part of this report. Further, Management Discussion and Analysis which includes detailed review of operations, performance and future outlook of the Company and its businesses forms a part of this report.

23. ACKNOWLEDGEMENT AND APPRECIATION

Your Directors convey their sincere appreciation to customers, vendors, Banks, Financial Institutions, Business Associates, Regulatory and Government Authorities and all other stakeholders for their continued co-operation and support to the Company.

The Directors appreciate and value the trust reposed and faith shown by every shareholder of the Company.

Last but not the least the Board wishes to convey its deep gratitude and place on record their appreciation to all its employees for their enthusiasm, team efforts, devotion and sense of belongingness.

For and on behalf of the Board Place : New Delhi (Sanjay Aggarwal) Dated : 13.08.2014 Chairman & CEO


Mar 31, 2012

The directors hereby present the 18th annual report along with audited statement of accounts of the Company for the year ended 31st March, 2012.

1. FINANCIAL RESULTS

The financial performance of the Company for the year ended 31st March, 2012 is summarised below:



Turnover including Other Income 50,939.23 42,283.88

Profit/ (Loss) before Interest, Depreciation and Tax (1,004.67) (5,545.27)

Interest 3,582.54 3,365.90

Depreciation & Amortisation of FCMITDA 1,243.40 1,239.03

Profit/(Loss) before Tax (5,830.61) (10,150.20)

Provision for Taxation - -

Profit/(Loss) after Tax (5,830.61) (10,150.20)

Taxation for earlier years (4.85) (7.00)

Net Profit/(Loss) (5,835.46) (10,157.20)

Add: Balance brought forward from last year (4,588.84) 5,568.36

Profit/(Loss) Carried to Balance Sheet (10,424.30) (4,588.84)

During the year the Company has incurred a net Loss of Rs 5,835.46 Lacs as against net loss of Rs 10,157.20 Lacs during previous year 2010-11, the gross turnover of the Company including other income stood at Rs 50,939.23 Lacs as against Rs 42,283.88 Lacs in fiscal 2010-11.

The Company is still facing challenging business environment. The performance during FY12 is however broadly in line with the projections made under approved CDR package.

2. DIVIDEND

In view of losses incurred by the company during the current financial year, your directors do not recommend declaration of any dividend for the year 2011-12.

3. CORPORATE DEBT RESTRUCTURING

Your company got its debt restructured under Corporate Debt Restructuring (CDR) mechanism in October, 2010. The Company again sought Rework Package in order to further strengthen its financial position. CDR EG vide their Letter of Approvals (LOA) dated 11th July, 2012 has approved CDR rework package till FY20 allowing fresh moratorium for repayment of term loans and funding of interest for another one and half year from cut of date i.e. 1st April, 2012. The Company is financially capable for executing bulk business to their customers with support of said approved CDR Rework Package.

4. CONVERTIBLE WARRANTS

During the year, 4,391,795 warrants aggregating to an amount of Rs 570.93 lacs were converted into equity shares of Rs 2/- each. The convertible warrants were allotted in FY10 and FY11 at a price of Rs 13/- each aggregating to promoter group companies on preferential basis in terms of SEBI (Issue of Capital and Disclosure Requirements) Regulations 2009. There are no convertible warrants outstanding as at 31st March, 2012.

5. SHARE CAPITAL

During the year, the Company allotted 4,391,795 equity shares of Rs 2/- each at a price of Rs 13/- each inclusive of premium of Rs 11/- each aggregating to Rs 570.93 lacs to the specified promoter group companies upon conversion of warrants on preferential basis.

As at 31st March, 2012, the subscribed and paid up capital of the Company stood at Rs 186,053,930/- divided into 93,026,965 equity shares of Rs 2/- each.

6. FOREIGN CURRENCY CONVERTIBLE BONDS (FCCBs)

The Company raised US$ 27 million by way of allotment of 1% Unsecured Foreign Currency Convertible Bonds (FCCBs) due 2011 in the financial year 2006-07. During the financial year 2009-10, the Company bought back 3,900 bonds of US$ 5,000 each at a discount. Outstanding FCCBs amounting to USD 7.5 million were due for redemption on 23rd November, 2011 and are yet to be redeemed. The Company was to redeem these FCCBs at a Premium equal to 145.54% of the outstanding principal amount. The Company has duly informed the FCCBs holders about its financial position and is in discussion with the FCCBs holders, through the trustee, for re-schedulement of payment due on the outstanding FCCBs.

The Company has been regular in making payment of semi-annual interest payable on outstanding FCCBs on their respective due dates. Interest till maturity date i.e. 23rd November, 2011 has been fully paid to the bondholders. Interest from the maturity date to 31st March, 2012 is yet to be paid. All outstanding Bonds as per the offering circular on the date of redemption were liable to be redeemed at a price of US$ 7,277. The Bonds are listed at Luxembourg Stock Exchange. In view of this redemption amount is subject to rescheduling /final settlement with FCCBs holders. The premium if paid, would be adjusted against the securities premium account.

7. GLOBAL DEPOSITORY RECEIPTS (GDRs)

The Global Depository Receipts issued by the company during the financial year 2006-07 are listed at Luxembourg Stock Exchange. There are GDRs outstanding which represents 301,750 equity shares of Rs 2/- each as at 31.03.2012.

8. FUTURE OUTLOOK

Your company is facing a difficult business environment. Market conditions are expected to improve gradually in future. Your company is one of the major players in the Indian cable industry and caters to the cabling requirements of three major sectors namely Power, Railways and Telecom. Your company expects growth in all these sectors.

The company is focusing upon business segments which may give better price realization. The economic climate seems to have already reached its lowest stage and there is considerable hope of improvement in the coming years. As soon as investment in Power and Industrial sector picks up, the demand for cables should again become buoyant. We also are an established player in the Optical Fiber telecom cables segment which is expected to enter into a demand boom period by the end of current fiscal due to the recent Government decision to form the NOFA- National Optical Fiber Authority which plans to provide OF connectivity up-to taluka and village levels all over the country within the next 3 years. The demand for cables from Railways has also started showing an uptrend after nearly 3 years of slackness in the signaling network maintenance.

9. REPORTING TO BOARD OF INDUSTRIAL AND FINANCIAL RESTRUCTURING {BIFR}

As per the audited accounts of the Company for the year ended 31.03.2012, the accumulated losses of the Company as at the end of the said period amounting to Rs 10,424.30 Lacs have resulted in erosion of more than fifty percent of its peak net worth of Rs 19,387.96 Lacs during the immediately preceding four financial year.

In terms of Section 23 of the Sick Industrial Companies (Special Provisions) Act, 1985, the Company falls under the category of potentially sick Industrial Company and therefore the fact is required to be reported to Board of Industrial and Financial Restructuring (BIFR) within 60 days from the date of finalisation of the audited accounts. A report on causes of erosion of net worth and steps taken by the Company is forming part of the notice of AGM.

10. DIRECTORS

In terms of the relevant provisions of the Companies Act, 1956 read with Articles of Association of the company, Mr. S. P. S. Dangi and Mr. Satya Pal, Directors of the Company retire by rotation at the ensuing Annual General Meeting and being eligible offer themselves for re-appointment. Brief resume of the directors proposed to be reappointed, the nature of their expertise in specific functional areas, names of the companies in which they hold directorships and memberships/ chairmanships of Board Committees, shareholding and relationships between directors inter-se, as stipulated under clause 49 of the Listing Agreement with the Stock Exchanges are forming part of the Notice of Annual General Meeting.

11. STATUTORY AUDITORS

M/s Jagdish Chand and Co., Chartered Accountants, New Delhi, the statutory auditors of the company retire at the ensuing Annual General Meeting and being eligible offer themselves for re-appointment. The audit committee has recommended their re-appointment. They have given a certificate to the effect that their appointment, if made, will be within the limit specified in Section 224 (IB) of the Companies Act, 1956.

12. AUDITORS REPORT-CLARIFICATIONS AND EXPLANATIONS

(1) Auditors Report Point no. 4 (a) preparation of financial statements on going concern basis.

The financial statements have been prepared on going concern basis despite the huge losses suffered by the Company and substantial erosion of net worth, as your directors are confident that the company will be able to generate profits in future years and dispose off some assets to meet its financial obligations as may arise. The accompanying financial statements have been prepared on a going concern basis based on cumulative impact of following mitigating factors:

a) The company has not defaulted in payment of statutory dues or its trade creditors etc.

b) CDR package was approved during previous year and further "Rework Package" has been approved by CDR- EG vide Letter of Approval (LOA) dated 11th July, 2012. As per the Rework Package, there is no default in payment of Principal and/or interest to banks as on date.

c) The Company and promoters have undertaken to raise adequate finances by way of disposal of assets and induction of fresh funds by promoters and/or promoter group companies.

(2) Auditors Report Point no. 4 (b) diminution in the value of investments.

In the opinion of the management, diminution in the value of investment in shares of Paramount Wires & Cables Limited (Associate) and Paramount Holdings Limited (Subsidiary) is temporary in nature. Considering, in the case of AEI Cables Limited, United Kingdom (the 100% subsidiary of Paramount Holdings Ltd, Cyprus), various factors including the CVA scheme having been implemented, business restructuring being undertaken, expected cash flows from operations, possibility of successfully additional arranging finance from the bankers and /or alternate finance providers and /or potential investors, orders in hand and assets base ; and in the case of the Associate, considering the future prospects, orders in hand and assets base of the investee company, no provision for diminution in value is required.

(3) With respect to Point no. 5 (a) and 5 (b) of auditor's report, please refer to the explanation given under the heading Foreign Currency Convertible Bonds (FCCBs) of this report.

13. COST AUDITORS

M/s Aseem Jain & Associates, Cost Accountants, a proprietorship firm, running under the proprietorship of Mr. Aseem Jain a Fellow member of Institute of Cost Accountants of India bearing membership no. 18592, are appointed as Cost Auditors of the Company for the current financial year by the board upon recommendation of Audit Committee and necessary Government Approval. The firm holds relevant experience of over 14 years and has been associated with the Company as its Cost Auditors.

The Cost Audit involves audit of the cost records relating to 'Electric Cables and Conductors' maintained by the Company at its units situated at Khushkhera and Dharuhera.

During the year, the Cost Audit Report for both the units was filed with the Ministry of Corporate Affairs, Government of India on 17.09.2011, whereas the due date of filing was 30.09.2011.

14. SUBSIDIARIES

The company has three wholly owned foreign subsidiaries viz. Paramount Holdings Limited, Cyprus, AEI Cables Limited, United Kingdom and AEI Power Cables Limited, United Kingdom.

Consolidated financials include audited financials of Paramount Holdings Limited, Cyprus, AEI Cables Limited, United Kingdom and AEI Power Cables Ltd., United Kingdom for the year/period ended 31st March, 2012.

Particulars relating to subsidiary companies, as required under section 212 of the Companies Act, 1956 are annexed herewith.

15. EXEMPTION U/S 212 FOR SUBSIDIARIES

The Company has availed exemption from attaching Balance Sheet, Profit & Loss Account, Directors' Report, Auditors Report and such other documents of the subsidiary Companies as prescribed under section 212 (1) of the Companies Act, 1956 with its annual report. The exemption is being availed in terms of General Circular No. 2/2011 dated 8th February, 2011 issued by Ministry of Corporate Affairs granting general exemption under Section 212 (8) of the Companies Act 1956.

Accordingly, the consolidated financials and gist of financial performance of subsidiaries are forming part of the present annual report. Further the annual accounts of the subsidiary Companies are kept open for inspection by any member/ investor during business working hours at the registered office of the Company and a copy of the same along with detailed information will be made available on demand of any member of the Company or any of its subsidiaries to that effect.

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

As per the requirements of Section 217(1)(e) of the Companies Act, 1956 and the Rules made there under the information relating to conservation of energy, technology absorption and foreign exchange earnings and outgo is annexed hereto and forms an integral part of the report.

17. ISO CERTIFICATION

The Company holds ISO 9001:2000 and ISO 14001 certifications for both of its plants at Khushkhera, Rajasthan and Dharuhera, Haryana.

18. PARTICULARS OF EMPLOYEES

There are no employees whose particulars are required to be disclosed in this report under Section 217(2A) of the Companies Act, 1956 read with Companies (Particulars of Employee) Rules, 1975 as amended form time to time.

19. INSURANCE

All insurable assets of the company including inventories, buildings and plant & machinery are adequately insured.

20. FIXED DEPOSITS

There is no fixed deposit from public outstanding as on 31st March, 2012.

21. LISTING OF SHARES

The equity shares of the company are listed at The Bombay Stock Exchange Ltd. (BSE) and National Stock Exchange of India Ltd. (NSE). The BSE & NSE have nation -wide trading terminals and therefore provide full liquidity to the investors. The Global Depository Receipts (GDRs) and Foreign Currency Convertible Bonds (FCCBs) issued by the company in the international market are listed at Luxembourg Stock Exchange. Equity shares of the Company had also been listed with the Calcutta Stock Exchange Ltd. However the Company has applied for delisting on 03.03.2004 and the application is still pending disposal at the exchange.

22. CORPORATE GOVERNANCE

Report on corporate governance as prescribed by the Listing Agreement is annexed and forms part of Annual Report. The auditor's certificate on compliance of the provisions of corporate governance in terms of Listing Agreement is also attached.

23. DIRECTORS' RESPONSIBILITY STATEMENT

Pursuant to the requirements of Section 217(2AA) of the Companies Act, 1956 with respect to Directors' Responsibility Statement, your Directors hereby confirm that:

i) In the preparation of the annual accounts for the financial year ended 31st March, 2012, the applicable accounting standards had been followed except as disclosed and explained in this report.

ii) They had selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit or loss of the company for the year under review;

iii) They had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

iv) They had prepared the accounts for the financial year ended 31st March, 2012 on a 'going concern' basis.

24. ACKNOWLEDGEMENT

Your directors place on the record their sincere appreciation for the valuable assistance and continued support received from our esteemed customers, government authorities, financial institutions, banks and shareholders of the company. We further express our gratitude to all our employees for their committed services to the Company.

For and on behalf of the Board,

Place : New Delhi (Sanjay Aggarwal)

Dated : 9th August, 2012 Chairman & CEO


Mar 31, 2010

The directors have pleasure in presenting the 16th Annual Report and audited accounts of the company for the year ended 31st March, 2010.

1. FINANCIAL RESULTS

For the year ended For the year ended 31.03.2010 31.03.2009 (Rs. in Lacs) (Rs. in Lacs)

Turnover including Other Income 41,774.44 49,595.59

Profit before Interest, Depreciation and Tax 4,134.00 1,083.28

Interest (Net) 2,813.71 (3,100.48)

Depreciation & Amortisation of FCMITDA 1,243.85 (1,502.95)

Profit/(Loss) before Tax 76.44 (3,520.15)

Provision for Taxation 13.46 623.96

Profit/(Loss) after Tax 62.98 (2,896.19)

Taxation for earlier years (0.18) (39.94)

Net Profit/(Loss) 62.80 (2,936.13)

Add: Balance brought forward from last year 5,505.56 8,441.69

Profit available for Appropriation 5,568.36 5,505.56 Appropriation:

-Proposed Dividend - -

-Provision for Dividend Distribution Tax - -

-Transfer to General Reserve - -

Surplus carried to Balance Sheet 5,568.36 5,505.56

2. PERFORMANCE REVIEW OF OPERATIONS

The company has achieved a gross turnover including other income Rs. 41,774.44 Lacs and profit/(Loss) after tax Rs. 62.80 Lacs for the year 2009-2010 as compared to Rs. 49,595.59 Lacs and loss of Rs. (2,936.13) Lacs respectively for the previous year 2008-2009.

The companys export business in foreign currency including deemed exports was Rs. 2,995.88 Lacs during the year as compared to Rs.7,524.68 Lacs in the previous year. The decrease in the exports is due to global meltdown and adverse development took place world-wide which affected the business of the company. The Company is now targeting growth in its export business through the network of its wholly owned subsidiary AEI Cables Limited, United Kingdom. AEI Cables, arguably is one of the oldest cable manufacturers in the world.

3. DIVIDEND

In view of Cash Losses incurred by the company during the financial year under reporting, your directors do not recommend any dividend for the year 2009-10.

4. REVIEW OF OPERATIONS

Your company has added fresh capacity to manufacture domestic wires which commenced production in July, 2009. Domestic wires business is going to be among the important drivers of the top-line and bottom-line growth of the company.

5. FOREIGN CURRENCY CONVERTIBLE BONDS (FCCBs)

The company raised US$ 27 million by way of allotment of 1% Unsecured Foreign Currency Convertible Bonds due 2011 in the financial year 2006-07. The said bonds have maturity of five years and one day and shall mature on 23rd November, 2011. The company has reset the conversion price downward to Rs. 42.60 per share of Rs. 2/- each (post split) on its first anniversary and the same remained unaltered and unchanged during the second and third anniversaries of the Bonds. During the year under review, company bought back 3,900 bonds of US$ 5,000 each at a discount. There are 1,500 bonds of US$ 5000 each outstanding as at 31.03.2010.

The company is regular in making payment of semi-annual interest payable on outstanding FCCBs on their respective due dates. Unless, the balance Bonds are previously redeemed, repurchased, cancelled or converted, the company shall redeem the Bonds on 23rd November, 2011 equal to the outstanding principal amount of the Bonds together with the redemption premium and accrued but unpaid interest thereon to the maturity date. All outstanding Bonds on the date of redemption would be redeemed at a price of US$ 7,277 providing a Yield to Maturity (YTM) of 8.5% per annum. The Bonds are listed at Luxembourg Stock Exchange.

6. GLOBAL DEPOSITORY RECEIPTS (GDRs)

The Global Depository Receipts issued by the company during the financial year 2006-07 are listed at Luxembourg Stock Exchange. There are GDRs outstanding which represents 3,01,750 equity shares of Rs. 2/- each as at 31.03.2010.

7. FUTURE OUTLOOK

The pace of anticipated investment in infrastructure, power, telecom, railways and industrial sectors was affected in the past due to the loss in growth momentum resulted from global meltdown, corporate frauds and financial crises reported world over during the last few fiscal, however, the growth seems to be regaining its momentum, the demand for the companys product is expected to improve. The cable industry was also affected due to stiff competition among industry players. The raw material prices recorded exorbitantly high fluctuations in the past and crashed thereafter which affected the turnover of the company in terms of value.

The company has commenced business of domestic copper flexible and building wires, which are being manufactured at the companys state of art manufacturing facilities in India under the technical guidance of its foreign subsidiary AEI Cables Ltd., pioneer building wires manufacturers in the UK. The company has introduced British Technology high performance lead free cables with low smoke and fire retardant options in India during July, 2009 and expect to capture all Indian markets within the span of three years. The company is targeting regular export business through the existing marketing set up of AEI Cables Limited, UK.

8. DIRECTORS

In terms of the relevant provisions of the Articles of Association of the company, Mr. S. P. S. Dangi and Mr. Satya Pal retire by rotation at the ensuing Annual General Meeting and being eligible offer themselves for re-appointment. Brief resume of the directors proposed to be reappointed, the nature of their expertise in specific functional areas, names of the companies in which they hold directorships and memberships/chairmanships of Board Committees, shareholding and relationships between directors inter-se, as stipulated under clause 49 of the Listing Agreement with the Stock Exchanges are provided in the report on corporate governance.

9. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to the requirement under Section 217(2AA) of the Companies Act, 1956 with respect to Directors Responsibility Statement, it is hereby confirmed:

i) That in the preparation of the annual accounts for the financial year ended 31st March, 2010, the applicable accounting standards had been followed;

ii) That the directors had selected such accounting policies and applied them consistently and made judgments and estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the company at the end of the financial year and of the profit or loss of the company for the year under review;

iii) That the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

iv) That the directors had prepared the accounts for the financial year ended 31st March, 2010 on a going concern basis.

10. AUDITORS

M/s Jagdish Chand and Co., Chartered Accountants, New Delhi, the statutory auditors of the company retire at the ensuing Annual General Meeting and being eligible offer themselves for re-appointment. The audit committee had recommended their re-appointment. They have given a certificate to the effect that their appointment, if made, will be within the prescribed limit specified in Section 224 (IB) of the Companies Act, 1956.

M/s Aseem Jain & Associates, Cost Accountants, have been re-appointed as Cost Auditors for conducting Cost Audit subject to the approval of Central Government.

11. SUBSIDIARIES

The company has two wholly owned foreign subsidiaries viz. Paramount Holdings Limited, Cyprus and AEI Cables Limited, United Kingdom.

Consolidated financials include audited financials of Paramount Holdings Limited, Cyprus for the year ended 31st March, 2010 and Audited financials of AEI Cables Limited, UK for the period from 1st September, 2008 to 31st August, 2009 and for the period from 1st September, 2009 to 31st March, 2010 are attached. The financial year of AEI Cables Ltd. UK has been changed to end on 31st March instead of 31st August. Accordingly, the next financial year of AEI Cables Ltd. commenced on 1st April, 2010 and will end on 31st March, 2011.

Particulars relating to subsidiary companies, as required under section 212 of the Companies Act, 1956 are annexed herewith.

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

The information as regards conservation of energy, technology absorption and foreign exchange earnings and outgo required under Section 217(1)(e) of the Companies Act, 1956 and the Rules made there under is annexed hereto and forms an integral part of the report.

13. ISO CERTIFICATION

The Company holds ISO 9001:2000 and ISO 14001 certifications for both of its plants at Khushkhera, Rajasthan and Dharuhera, Haryana.

14. PARTICULARS OF EMPLOYEES

Information as per Section 217(2A) of the Companies Act, 1956 read with Companies (Particulars of Employee) Rules, 1975 is given below:

Name Designation Gross Qualification Remuneration

Sanjay Aggarwal Chairman & CEO 3,022,540 B.Com (Hons.) Sandeep Aggarwal Managing Director 29,78,951 B.A. (Economics)

Name Experience Date of Age Joining

Sanjay Aggarwal 29 years 01.11.1994 48 yrs

Sandeep Aggarwal 27 years 01.11.1994 46 yrs

15. INSURANCE

All insurable asset of the company including inventories, buildings and plant & machinery are adequately insured.

16. FIXED DEPOSITS

There is no fixed deposit from public outstanding as on 31st March, 2010.

17. LISTING OF SHARES

The equity shares of the company are listed at The Bombay Stock Exchange Ltd. (BSE) and National Stock Exchange of India Ltd. (NSE). The BSE & NSE have nation -wide trading terminals and therefore provide full liquidity to the investors. The Global Depository Receipts (GDRs) and Foreign Currency Convertible Bonds (FCCBs) issued by the company in the international market are listed at Luxembourg Stock Exchange.

18. CORPORATE GOVERNANCE

Report on Corporate Governance as prescribed by the Listing Agreement is annexed and forms a part of Annual Report. The auditors certificate on compliance of the provisions of corporate governance as mentioned in the Listing Agreement is also attached.

19. ACKNOWLEDGEMENT

Your directors place on the record their appreciation of the assistance and support extended by all our valued customers, government authorities, financial institutions, banks and shareholders of the company. Your directors also express their appreciation for the services rendered by the employees of the company.

For and on behalf of the Board,

Date: 28th May, 2010 (Sanjay Aggarwal)

Place: New Delhi Chairman & CEO



 
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