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Directors Report of Shiva Cement Ltd.

Mar 31, 2016

(Management Discussion and Analysis)

Dear Members,

It gives me immense pleasure to present the 30th Annual Report. I extend my thanks to all associates, shareholders & employees in particular. Your company could complete successful 30 years with their support and commitment. With this, I am pleased to present annual report along with audited accounts and Auditor''s report thereon for the financial year ended 31st March, 2016 as under ''

Financial/Operational Performance (Rs. in Lakhs)

Particulars

31/03/2016

31/03/2015

Turnover

7834.20

7533.08

Operating Income

924.37

964.73

Other Income

42.21

39.63

PBIDT

966.58

1004.36

Less: Interest

363.13

337.55

Cash Profit (PBDT)

603.45

666.81

Less: Depreciation & Amortization

539.64

390.61

Profit before Taxation (PBT)

63.81

276.20

Capacity utilization was about 70% in line with National average. However, selling expenses were relatively higher for re-introducing ‘Sumangal'' brand which was discontinued in the year 2007. Due to long shut down of Kiln, part quantity of clinker was out-sourced (about 6% of total consumption) at higher cost. For this operating income was reduced despite increase in turnover.

Capex for interim expansion from 1.32 lakh TPA to 1.98 lakh TPA was almost completed in the ensuing year. However, commercial production could not commence due to various reasons. As a result of which, depreciation cost has gone up significantly depressing profit after depreciation.

Economic Scenario & Out look

India achieved 6.7% growth of GDP in FY 2016 compared to 7.2% in FY 2015. Inflation, Fiscal and Current Account deficits were also moderated. All these macro indicators is displaying positive trend. However, there are many concerns. Index of Industrial Production (IIP) had grown by bare 2.4%; which is discouraging. Gross Capital Formation (GCF) declined from 31.2% to 29.3% in FY 2016. Visible recovery in Core sector and Capital goods sector is almost absent. Growth in rural demand is not keeping a pace; which represents large population of India.

Indian economy is thriving on consumption led demand instead of investment led demand. India could attract large inflow of Global funds; but those were mostly not invested in Capital assets. Lately, Government has pushed Infra spending, particularly in transport sector. But somehow, private investment is sluggish due to high interest, stretched balance sheets and non-compatible regulations. Government succeeded in creating competition among states for attracting investment; that will certainly give long term benefits. However, attention for relieving stress of existing productive assets is somewhat missing.

Considering sincere efforts of Government, favorable monsoon, and latent potential of India, Indian economy will re-bound beyond doubt, may be second half of FY-2017. For this, India must overcome past legacy and deploy financial resources to productive activities. Simultaneously, exports may be made competitive by reducing cost of basic inputs like Energy, Logistics, Capital & Minerals.

Cement Industry Outlook & Opportunities

Over all capacity utilization in India was around 70% in FY-2016, which has caused supply over-hang situation, particularly with cluster located plants. Decline in industrial investment and infrastructure spending has reduced demand growth below 5%; which is very low as per past 10 years trend. Past data after 2000 reveals that; moving average of demand growth was always above 7%. It is therefore expected that, demand will surge in FY 2017 and take a leap jump in FY 2018. Recent Merger and Acquisitions is also indicating the same. Good monsoon will push up rural demand. Infra-spending and Industrial investment will supplement. Recent announcement of schemes like, “House for all” and “Smart City” will give a further boost.

Historically, indirect taxes on Cement were too high pushing the consumer''s cost. Upcoming GST will give relief to the consumer pushing demand. Cheap land and easy availability of construction materials like sand & aggregates will give a big push to housing sector.

Future Strategies

Expansion plan up to 1.0 MnT was deferred and term loan sanctioned by PNB and IDBI Bank were not available in past years mainly due to non receipt of committed investment by a cement major company. Hence your company is now scouting for other strategic investors for completing un-finished agenda. It has appointed Financial Advisor for this purpose. It is likely to be finalized in FY 2017. Your company is having ample limestone reserve for meeting the expansion need. Land and approvals are in place. Part capex is also done. In view of this, gestation period for completing the project will be too low.

Awards & Recommendations

Your Managing Director has written several articles on Indian economy those were published in magazines and newspapers. Several compliments have been received from VIPs to this effect. It is also displayed in company website.

Shiva Cement Limited has been awarded with Second Prize for “General working” of our Limestone mines on the occasion of 53rd Annual Mines Safety Week Celebration 2015.

Human Resource

Company is maintaining cordial and healthy relations with its employees. Employees at all levels are extending their full support. Company has strong faith in potential of human resources. It believes in the creative abilities of the people, who work for company. It believes in participatory management. Considering high inflation, your company has entered into wage settlement of the workers that will be valid till the year 2017.

Internal Control Systems

Company has an internal management audit team commensurate with the size of company. It carries out desired level of audit of various activities of company. This is with an aim to ensure that the laid down system and procedures are followed. Audit reports are presented to Audit committee of the board, which meets at periodic intervals.

Business Responsibility Report

As stipulated under the Listing Agreement, the Business Responsibility report describing the initiatives taken by the Company from environmental, social and governance perspective has been described in this Annual Report.

Environmental & Social Obligation

Environment clearance from Ministry of environment & forest (MoEF) has been already obtained for it''s proposed expansion upto 1.05 MTPA capacity. MoEF clearance has been also obtained for expanding the capacity of mines.

Your company has undertaken the CSR activities in nearby villages such as construction of Toilet rooms and Water storage tank in different local schools, specially for girl students at Kandeimunda, Guleipada, Telighana, Mangapada etc. five no. of bathing Ghats at Goleipada, Bhoktapada. Road from Jindapada and Kandeimunda connecting roads to SH-10 was repaired by Murrum.

Hockey, Football and Cricket tournaments were organized with the help of Kandeimunda Panchayat for local youths and providing them sports kits. We are associated with different health awareness programmes like Pulse Polio etc.

Club House was renovated for social meets, meetings and different cultural functions. Celebration of Independence and Republic Day was done at Kandeimunda, Telighana and local schools. Several other cultural & social programmes were undertaken surrounding plant area. All such activities have created a social harmony

Dividend

Keeping in view of ongoing expansion plans and working capital requirements of the Company, your directors have not recommended any dividend for the year under review.

Listing at Stock Exchange

Equity shares of the company continue to be listed on Bombay stock exchange and Calcutta stock exchange. We sincerely express our thanks to all shareholders for imposing their faith in the company despite delay in implementation of the expansion plan. The annual listing fee for the year 2015-16 had been paid to Bombay stock exchange.

Finance

We are thankful to IDBI Bank for sanctioning the term loan of Rs.10 crore for meeting some pressing needs including capex for complying Pollution control norms and requirement of funds for Stamp duty towards mining lease extension. However, need based working capital for the expanded capacity of 1.98 lakh TPA was not favourably considered. Due to which, commercial production of expanded capacity could not commence till year end.

CARE rating have also assigned “CARE BB” for long term bank facilities & “CARE A4” for short term bank facilities amounting to Rs.47.44 crore. This includes existing and proposed loan.

Board Meeting

During the year under report, the Board of Directors have met 6 (Six) times. The Details of board meetings and the attendance of the Directors are provided in the Corporate Governance Report.

Fixed Deposits

Company has accepted deposits from public including share holders and employees within the meaning of section 73 of the Companies Act, 2013 and rules made there under and have made compliance with the provisions of the Companies (Acceptance of Deposits) Rules 2014 as per expert opinion obtained by the Company regarding eligibility to accept deposits.

Audit Committee

Pursuant to the provisions of Section 177 of the Companies Act, 2013, the Audit Committee was formed by the Board of Directors to look after the internal control system of the Company and to review the financial statements. The said Committee is consisting of the following directors of the Company

Sri K. P. Jhunjhunwala - Chairman

Sri B.K. Mangaraj - Member

Sri Mahendra Singh - Member

The details of the Audit Committee meeting have been mentioned in the Corporate Governance report.

Statutory Auditors

M/s. Tibrewal Chand & Co., Chartered Accountants, Rourkela (FRN 311047E) the Statutory Auditors of the Company, will retire at the conclusion of the ensuing Annual General Meeting. In their place M/s. M.K. Thaberia & Associates, Chartered Accountants, Rourkela (FRN 321180E) may be appointed. The Company has received a letter from them to the effect that their appointment, if made, would be within the limit prescribed under Section 139 of the Companies Act, 2013 and that they are not disqualified within the meaning of Section 141 of the Companies Act, 2013 read with Rule 4(1) of the Companies (Audit & Auditors) Rules, 2014.

The Notes to Accounts forming part of financial statements are self-explanatory and need no further explanation.

The explanations/clarifications to the qualified opinion of the statutory Auditors are as under :-

As mentioned in the Auditors Report regarding eligibility to accept public deposits, your Company has obtained expert opinion and continued to accept, hold & renew the deposits.

As mentioned in the Auditor''s Report regarding default in repayment of installments relating to redemption of preference shares of Rs.65.00 lakhs and term loan installments and interest of Rs.54.77 lakhs due to banks & Financial Institutions, in this regard your directors submit that the Management has approached Preference shareholders for deferment of their installments. As regards repayment of term loan interest and installments your directors submit that the said payments could not be made due to mismatch of cash flow during the financial year 2015-16. The said payments shall be made during the financial year 2016-17.

As mentioned in the Auditors Report regarding irregularity in deposits of statutory dues amounting to Rs.437.18 Lacs, your directors submit that the said payments could not be made due to mismatch of cash flow during the financial year 2015-16. The said payments shall be made during the financial year 2016-17.

Secretarial Auditors

Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors have appointed M/s. Prakash Sahoo & Associates, Practicing Company Secretaries of Rourkela to undertake the Secretarial Audit of the Company for the FY 2015-16. The report of Secretarial Audit forms part of this Board''s Report in “Annexure -A”.

There are no qualifications or adverse remarks in the Secretarial Auditors'' Report which require any clarification or explanation.

Vigil Mechanism

Pursuant to the provisions of Section 177 (9) of the Companies Act, 2013, the Board of Directors has established a committee to provide adequate safeguard against the victimization & to protect the interest of the directors and employees to report their genuine concerns. The Company has uploaded in its website (www.shivacement.com) the code of conduct in relation to the employees & directors. The Policy on vigil mechanism and whistle blower policy may be accessed on the Company''s website.

Foreign Exchange Earnings and Outgo

There have been no foreign Exchange earnings during the year. However, company has purchased imported coal from the domestic market.

Conservation of Energy, Technology Absorption

A statement containing necessary information, as required under the Companies Act, 2013 is annexed hereto in Annexure-”B”.

Corporate Social Responsibility and Governance Committee

Your directors have constituted the Corporate Social Responsibility (CSR Committee) comprising Shri R P Gupta as the Chairman and Shri B.K. Mangaraj and Shri Mahendra Singh as other members.

The said Committee has been entrusted with the responsibility of formulating and recommending to the Board, a Corporate Social Responsibility Policy (CSR Policy) indicating the activities to be undertaken by the Company, monitoring the implementation of the framework of the CSR Policy and recommending the amount to be spent on CSR activities.

Nomination and Remuneration Committee & Stakeholder Relationship Committee

During the year under report, pursuant to the provisions of Section 178 of Companies Act, 2013, the nomination and Remuneration Committee & Stakeholder Relationship Committee has been functioning in order to protect the interest of the shareholder of the Company.

The Committee has been headed by Shri R. P. Gupta as Chairman, Shri B. K. Mangaraj as Member & Shri Akash Gupta, as other member.

Extracts of Annual Return

Pursuant to the provisions of Section 92(3) of the Companies Act, 2013, an Extract of the Annual Return in Form MGT-9 forms part of this Report as Annexure-C.

Particulars of Employees

The provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are not applicable as none of the employees were in receipt of remuneration exceeding the limits specified therein.

Directors’ Responsibility Statement

In terms of the provisions of section 134(3)(c) of the Companies Act, 2013, we confirm that:-

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

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

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

d. the directors had prepared the annual accounts on a going concern basis; and

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

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

Corporate Governance

Pursuant to Clause-49 of the listing agreement, report on Corporate Governance and the compliance certificate thereon from the practicing company secretary is attached to this report.

Acknowledgements

Your directors place on record their appreciation of the assistance and support extended by government authorities, Bankers, NBFCs, consultants, shareholders, employees, suppliers & contractors of the company.

Cautionary Statement

Statements in the directors'' report and the management discussion & analysis describing company''s objectives, expectations or predictions, may be forward-looking statement within the meaning of applicable laws and regulations. Although we believe our expectation is based on reasonable assumption, actual results may differ materially from those expressed in the statement. Important factors that could influence the company''s operations include: global and domestic demand and supply conditions affecting selling prices, new capacity additions, availability of critical materials and their cost, changes in government policies and tax laws, economic development of the country, and such other factors which are material to the business operations of the company.

For and on behalf of the Board of

Shiva Cement Limited

Rourkela - 769 004 Sd/-

Dated : 30/05/2016 (R.P.Gupta)

(Managing Director)

DIN No. : 1325989


Mar 31, 2015

Dear Members,

It gives me immense pleasure to present the 29th Annual Report. extend my thanks to all associates, shareholders & employees in particular. Your company could complete successful 29 years with their support and commitment. With this, I am pleased to present annual report along with audited accounts and Auditor's report thereon for the financial year ended 31st March, 2015 as under :-

Financial/Operational Performance (Rs. in Lakhs)

Particulars 31/03/2015 31/03/2014

Turnover 7533.08 7211.46

Operating Income 964.73 962.14

Other Income 39.63 38.78

PBIDT 1004.36 1000.92

Less: Interest 337.55 339.70 Cash Profit (PBDT) 666.81 661.22 Less: Depreciation & Amortization 390.61 288.04

Profit before Taxation (PBT) 276.20 373.18

There was marginal rise in the gross turnover, but the operating income and PBIDT was almost stagnant. Profit before tax is reduced mainly due to higher provision of depreciation arising out of transfer of CWIP (capital work in progress) into fixed assets. Coal consumption has increased due to poor quality, but some savings were achieved on power consumption. The average price of coal has also gone up. There was volumetric growth in terms of cement production by 24% and dispatch of cement and clinker also grew by 18% despite sluggish demand. But it was mainly on account of low base in previous year.

Economic Scenario & Out look

As per new series of GDP, India has registered 7.3% growth in the year 2014-15. But it is not matching with the ground realities in terms of growth in consumption of cement and other core sector items. Probably, such high growth figures is reflected due to change of base year and adoption of new methods for estimating GDP. The revival of economy will depend upon aggressive spending by government on infrastructure. Simultaneously, the cost of logistic, energy and capital must be brought down so as to reduce production cost of all goods & services and to match with purchasing power of public. Incidentally, this will cut import and improve our competitiveness on export front and generate additional demand. At the same time, regulatory easement and ease of operating business must be ensured so that productivity and efficiency improves. It is also essential to infuse liquidity that will increase production of the existing productive assets in the country. Interest cost must slash down, that will give a big Phillip to housing, infrastructure and real estate's driving demand of cement industry. There are all indications of betterment in the second half of the year 2015-16.

Cement Industry Outlook & Opportunities

Demand growth is sluggish since last three years mainly due to slow down in economy and poor spending in infrastructure. There are great hopes that infrastructure spending will pick up in the second half of 2015-16. There are several announcements on the road sector and railway; that will directly support demand growth of cement. Rural demand has been quite healthy in past several years. But some slow down is noticed during ensuing year. Growth of housing sector was also somewhat muted. But with rising population and associated demand of houses, the situation is bound to improve. The announcement by government to provide house for all is an indicator to that. There are enough indications that, overall growth will revive from Oct.2015 and likely to gain momentum from Apr.2016 onwards.

Future Strategies

The expansion plan up to 1.0 Mn.TPA was deferred considering the economic scenario despite incurring part capex. Term loan sanctions from PNB and IDBI Bank were not availed due to such deferment. However, for part utilization of capex already incurred, an interim expansion up to 1.98 lakh TA was taken up during the year. The same is likely to be completed in June 2016. Its benefit will be visible in the second half of the year 2015-16, that may probably match with the revival cycle of cement industry and economy in general.

Risks and Concerns

Continuous rise in logistic cost is indeed an area of concern. For this all efforts are being taken to change distribution pattern and to focus on nearby areas for nullifying the impact of logistic cost. Poor quality of domestic coal and recent increase in royalty and imposition of contribution to District Mineral Foundation (DMF) is going to add to the cost of limestone and coal. Its impact is likely to come on the cost of power as well. However, the capacity expansion up to 1.98 lakh TPA will improve the cost efficiency and dilute fixed overhead cost to some extent.

Awards & Recommendations

Your Managing Director has written several articles on Indian economy those were published in magazines and newspapers. Several compliments have been received from VIPs to this effect.

Shiva Cement Limited has been awarded with Second Prize in Management of Sub Grade Minerals for the year 2014-15 from Indian Bureau of Mines, Bhubaneswar during 17th Mines Environment & Mineral Conservation Week held between 27.01.2015 to 01.02.2015.

Human Resource

Company is maintaining cordial and healthy relations with its employees. Employees at all levels are extending their full support. Company has strong faith in potential of human resources. It believes in the creative abilities of the people, who work for company. It believes in participatory management. Considering high inflation, your company has entered into wage settlement of the workers that will be valid till the year 2017.

Internal Control Systems

Company has an internal management audit team commensurate with the size of company. It carries out desired level of audit of various activities of company. This is with an aim to ensure that the laid down system and procedures are followed. Audit reports are presented to Audit committee of the board, which meets at periodical intervals. ERP system is now fully operative. It has contributed in improving efficiency.

Business Responsibility Report

As stipulated under the Listing Agreement, the Business Responsibility report describing the initiatives taken by the Company from environmental, social and governance perspective has been described in this Annual Report.

Environmental & Social Obligation

Environment clearance from Ministry of environment & forest (MoEF) has been already obtained for its proposed expansion up to 1.05 MTPA capacity. MoEF clearance has been also obtained for expanding the capacity of mines.

Your company has undertaken the CSR activities in nearby villages such as construction of Toilet rooms and Water storage tank in different local schools, specially for girl students at Kandeimunda, Guleipada, Telighana, Mangapada etc. Three no. of bathing Ghats at Goleipada, Bhoktapada. In addition, Jindapada and Kandeimunda connecting roads to SH-10 was repaired.

Hockey, Football and Cricket tournaments were organized with the help of Kandeimunda Panchayat for local youths and providing them sports kits. Program were held in local areas for awareness of energy and water conservation. We are associated with different health awareness programs like Pulse Polio etc.

Club House was renovated for social meets, meetings and different cultural functions. Celebration of Independence and Republic Day was done at Kandeimunda, Talihina and local schools. Several other cultural & social programs were undertaken surrounding plant area. All such activities have created a social harmony.

Dividend

Keeping in view of ongoing expansion plans and working capital requirements of the Company, your directors have not recommended any dividend for the year under review.

Listing at Stock Exchange

Equity shares of the company continue to be listed on Bombay stock exchange and Calcutta stock exchange. We sincerely express our thanks to all shareholders for imposing their faith in the company despite delay in implementation of the expansion plan. The annual listing fee for the year 2014-15 had been paid to these stock exchanges.

Finance

We are thankful to IDBI Bank for sanctioning the term loan of Rs.18 crore for part financing the capacity expansion up to 1.98 lakh TPA and Canara Bank for sanctioning a loan of Rs.5 crore.

CARE rating have also assigned "CARE BBB" for long term bank facilities & "CARE A3" for short term bank facilities amounting to Rs.48.0 crore. This includes existing and proposed loan.

Board Meeting

During the year under report, the Board of Directors have met 4 (Four) times. The Details of board meetings and the attendance of the Directors are provided in the Corporate Governance Report.

Fixed Deposits

Company has accepted deposits from public including share holders and employees within the meaning of section 73 of the Companies Act, 2013 and rules made there under and have made compliance with the provisions of the Companies (Acceptance of Deposits) Rules 2014 as per expert opinion obtained by the Company regarding eligibility to accept deposits.

Directors & Key Managerial Personnel

Pursuant to the provisions of Section 161 of the Company, Smt. Preeti Gupta who has been appointed as (additional director) non executive Woman Director, w.e.f. 31st March, 2015 can only hold office up to the date of the ensuing Annual General Meeting. The Company has received a notice under section 160(1) of the Companies Act, 2013, from a member proposing her appointment as non-executive woman director of the Company. The Board of directors recommends her appointment.

Pursuant to the provisions of Section 161 of the Company, Sh. Mahendra Singh who has been appointed as (additional director) non executive Independent Director, w.e.f. 31st March, 2015 can only hold office up to the date of the ensuing Annual General Meeting. The Company has received a notice under section 160(1) of the Companies Act, 2013, from a member proposing his appointment as non-executive Independent director of the Company. The Board of directors recommends his her appointment.

During the year under report, Shri Vivek Chawla & Shri O. P. Goyal have resigned from the Directorship of the Company from 09th July, 2014 & 31st March, 2015 respectively.

In accordance with the provisions of Section 152(6) of the Companies Act, 2013 read with the Articles of Association of the Company, Sri R. P. Gupta, Managing Director and Akash Gupta, Executive Director of your company retire from the board by rotation and being eligible for re-appointment.

Further, Sh. Debananda Nayak has been appointed as Company Secretary & Compliance officer of the Company w.e.f 01/05/ 2015.

Audit Committee

Pursuant to the provisions of Section 177 of the Companies Act, 2013, the Audit Committee was formed by the Board of Directors to look after the internal control system of the Company and to review the financial statements. The said Committee is consisting of the following directors of the Company.

Sri K. P. Jhunjhunwala - Chairman

Sri B.K. Mangaraj - Member

Sri Mahendra Singh - Member

The details of the Audit Committee meeting have been mentioned in the Corporate Governance report.

Statutory Auditors

M/s. Tibrewal Chand & Co., Chartered Accountants, Rourkela (FRN 311047E) the Statutory Auditors of the Company, will retire at the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment. The Company has received a letter from them to the effect that their appointment, if made, would be within the limit prescribed under Section 139 of the Companies Act, 2013 and that they are not disqualified within the meaning of Section 141 of the Companies Act, 2013 read with Rule 4(1) of the Companies (Audit & Auditors) Rules, 2014.

The Notes to Accounts forming part of financial statements are self-explanatory and need no further explanation. The explanations/clarifications to the qualified opinion of the statutory Auditors are as under :- As mentioned in the Auditors Report regarding eligibility to accept public deposits, your Company has obtained expert opinion and continued to accept, hold & renew the deposits.

As mentioned in the Auditors Report regarding irregularity in deposits of statutory dues amounting to Rs.102.53 Lacs, your directors submit that the said payments could not be made due to mismatch of cash flow during the financial year 2014-15. The said payments shall be made during the financial year 2015-16.

Secretarial Auditors

Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Board of Directors have appointed M/s S P Roy & Associates, Company Secretary, Bhubaneswar to undertake the Secretarial Audit of the Company for the FY 2014-15. The report of Secretarial Audit forms part of this Board's Report in "Annexure –A".

There are no qualifications or adverse remarks in the Secretarial Auditors' Report which require any clarification or explanation.

Vigil Mechanism

Pursuant to the provisions of Section 177 (9) of the Companies Act, 2013, the Board of Directors has established a committee to provide adequate safeguard against the victimization & to protect the interest of the directors and employees to report their genuine concerns. The Company has uploaded in its website (www.shivacement.com) the code of conduct in relation to the employees & directors. The Policy on vigil mechanism and whistle blower policy may be accessed on the Company's website.

Foreign Exchange Earnings and Outgo

There have been no foreign Exchange earnings during the year. However, company has purchased imported coal & gypsum from the domestic market.

Conservation of Energy, Technology Absorption

A statement containing necessary information, as required under the Companies Act, 2013 is annexed hereto in Annexure-"B".

Corporate Social Responsibility and Governance Committee

During the year under report, your directors have constituted the Corporate Social Responsibility (CSR Committee) comprising Shri R P Gupta as the Chairman and Shri B.K. Mangaraj and Shri Mahendra Singh as other members.

The said Committee has been entrusted with the responsibility of formulating and recommending to the Board, a Corporate Social Responsibility Policy (CSR Policy) indicating the activities to be undertaken by the Company, monitoring the implementation of the framework of the CSR Policy and recommending the amount to be spent on CSR activities.

Nomination and Remuneration Committee & Stakeholder Relationship Committee During the year under report, pursuant to the provisions of Section 178 of Companies Act, 2013, the nomination and Remuneration Committee & Stakeholder Relationship Committee has been functioning in order to protect the interest of the shareholder of the Company.

The Committee has been headed by Shri R. P. Gupta as Chairman, Shri B. K. Mangaraj as Member & Shri Akash Gupta, as other member.

Risk Management Policy

The Company has a Risk Management Policy in accordance with the provisions of the Act and Clause 49 of the Listing Agreement, which provides a mechanism for risk assessment and mitigation.

At present the Company has not identified any element of risk which may threaten the existence of the Company.

Disclosures under Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 Your Directors state that during the year an Internal Complaint Committee has been formed to review the cases filed pursuant to Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and further state that, there were no cases reported in respect to above mentioned Act.

Extracts of Annual Return

Pursuant to the provisions of Section 92(3) of the Companies Act, 2013, an Extract of the Annual Return in Form MGT-9 forms part of this Report as Annexure-C.

Particulars of Employees

The provisions of Section 197(12) of the Act read with Rules 5(2) and 5(3) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are not applicable as none of the employees were in receipt of remuneration exceeding the limits specified therein.

Directors' Responsibility Statement

In terms of the provisions of section 134(3)(c) of the Companies Act, 2013, we confirm that:- a. in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

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

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

d. the directors had prepared the annual accounts on a going concern basis; and

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

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

Corporate Governance

Pursuant to Clause-49 of the listing agreement, report on Corporate Governance and the compliance certificate thereon from the auditors of the company is attached to this report.

Acknowledgements

Your directors place on record their appreciation of the assistance and support extended by government authorities, Bankers, NBFCs, consultants, shareholders, employees, suppliers & contractors of the company.

Cautionary Statement

Statements in the directors' report and the management discussion & analysis describing company's objectives, expectations or predictions, may be forward-looking statement within the meaning of applicable laws and regulations. Although we believe our expectation is based on reasonable assumption, actual results may differ materially from those expressed in the statement. Important factors that could influence the company's operations include: global and domestic demand and supply conditions affecting selling prices, new capacity additions, availability of critical materials and their cost, changes in government policies and tax laws, economic development of the country, and such other factors which are material to the business operations of the company.

For and on behalf of the Board

Sd/-

Rourkela-769 004 R. P. Gupta

Dated : 29/05/2015 Managing Director

DIN No.: 01325989



Complied by: Dion Global Solutions Limited


Mar 31, 2014

Dear Members,

It gives me immense pleasure to present the 28th Annual Report. I extend my thanks to all associates, shareholders & employees in particular. Your company could complete successful 28 years with their support and commitment. With this, I am pleased to present annual report along with audited accounts and Auditor''s report thereon for the financial year ended 31st March, 2014 as under :-

Financial/Operational Performance (Rs. in Lakhs)

Particulars 31/03/2014 31/03/2013

Turnover 7211.46 6674.67

Operating Income 962.14 1047.31

Other Income 38.78 40.32

PBIDT 1000.92 1087.63

Less: Interest 339.70 341.04

Cash Profit (PBDT) 661.22 746.59

Less: Depreciation & Amortization 288.04 354.40

Profit before Taxation (PBT) 373.18 392.19

This was indeed a tough year due to sluggish demand and rising input cost. Despite this, we could register 8% growth in turnover but the operating margin declined to 13.9% as against 16.3% in previous year. However, the performance in Q-4 was far better that indicates part revival of economy in 2014-15. Despite all constraints, the profit before tax could be maintained almost at the same level with marginal dip of Rs.19.0 lakh.

Economic Scenario & Outlook

Growth of Indian economy has been sluggish after 2011. In the current year it has grown below 5% that was lowest in the decade. However, there are enough indications for revival of economy in the second half of 2014-15. But it will depend upon the regulatory easements, infrastructure spending and pro-growth policies which are still awaited. The major challenge before the Govt. is for controlling inflation and reducing the price of basic inputs like energy, mineral & transportation cost besides interest rates. Increasing land availability and sanction of more number of mineral leases will be crucial for bringing back the country on high growth track. The market expectations are positive.

Cement Industry Outlook & Opportunities

Demand growth has been sluggish in the previous two years mainly due to economy slow down and poor infrastructure spending. High interest rate has also affected growth of housing sector. But demand of house cannot be deferred for a long period. Govt. announcement for constructing cement roads at a rate of 20-25 Km/day is indeed encouraging. Despite slow down in economy, the silver lining was healthy demand growth in Rural area which was un-common in earlier years. Combining all these factors, there are fair chances of demand picking up in the second half of 2014-15 and gaining momentum in 2015-16.

Future Strategies

Long term benefits shall be derived only after completing Phase-1 expansion upto 1.0 MTPA. Your company has already acquired land, obtained environment approval and has incurred sizeable capex. But the project implementation was delayed beyond expectation due to delay in financial closure and other approvals. The cost of project has escalated due to these delays. Therefore it needs re-working and fresh approval from the lender.

However, your company has incurred sizeable capex for this project from its own resources. Therefore an interim business plan is being worked out for expanding the capacity upto 1.98 lakh TPA. This plan is envisaging augmentation of cement grinding capacity through balancing equipment. Company is having surplus capacity in the kiln which is lying idle at present. However, your company will not lose focus on the expansion plan of 1.0 MTPA for which parallel working will continue.

Risks and Concerns

Continuous hike in power rate and supply deficit of coal are the major areas of concern. Indian coal quality has deteriorated. Imported coal price is going up due to rupee weakening. Therefore company is undertaking its interim business plan and expansion plan along with modernization. This will reduce power & fuel consumption and provide competitive edge over others.

Logistic cost is on increasing trend due to general increase in petroleum & energy price. Vicinity of market & location in cement deficit region will mitigate such hike in logistic cost. Supply over hang is continuing on all India basis. It is likely to continue till CY 2014. But its impact is diluted due to plant location in eastern zone. This is supply deficit zone.

Awards & Recommendations

Your Managing Director wrote a book "Turn Around India" covering the topic on Indian economy revival. This book was launched in April 2013 by Sri Narendra Modi, currently Hon''ble Prime Minister of India. Several compliments have been received from VIPs including Hon''ble President of India in this regard. The compliments were received from Ministers, Bureaucrats of central & state govt., Dy. Governor-RBI, Bank Chairmans, leading corporates and Rating agencies.

Human Resource

Company is maintaining cordial and healthy relations with its employees. Employees at all levels are extending their full support. Company has strong faith in potential of human resources. It believes in the creative abilities of the people, who work for company. It believes in participatory management. Considering high inflation, your company has revised the pay structure of all the staff & officers which will be effective from April 2014.

Internal Control Systems

Company has an internal management audit team commensurate with the size of company. It carries out desired level of audit of various activities of company. This is with an aim to ensure that the laid down system and procedures are followed. Audit reports are presented to Audit committee of the board, which meets at periodical intervals. ERP system is now fully operative. It has contributed in improving efficiency.

Environmental & Social Obligation

Environment clearance from ministry of environment & forest (MoEF) has been already obtained for it''s proposed expansion upto 1.05 MTPA capacity. MoEF clearance has been also obtained for expanding the capacity of mines.

Your company opened a Tailoring centre at Guleipada Village. Provided Sewing machines & furnitures and trained 30 ladies for self employment. We constructed a Toilet room at Kandeimunda High School and two nos. of Bathing Ghat at Goleipada Pond. We also provided drinking water arrangement at Tehsil office, Kutra. The road from Panchora to Goleipada village was repaired.

We organized one Eye camp and eye operation of 23 persons was organized. A free health check up camp was organized at Telighana UP School. Besides this, Hockey tournament, celebration of Independence & Republic day was done at Kandeimunda village. Several other cultural & social programmes were undertaken surrounding plant area. All such activities have created a social harmony.

Dividend

In view of on going expansion and requirement of funds, we do not recommend any dividend for the year. Equity shares of the company continue to be listed on Bombay stock exchange and Calcutta stock exchange. We sincerely express our thanks to all shareholders for imposing their faith in the company despite delay in implementation of the expansion plan.

Finance

We are thankful to Punjab National Bank for sanctioning Rs.70 crore term loan in the capacity of lead bank for the proposed expansion project. IDBI Bank has also sanctioned a term loan of Rs.45 crore but the same has not accepted due to variation in terms from the Lead Bank. However, none of the loan is availed due to deferment of expansion plan. A fresh proposal will be re- submitted considering the project cost escalation.

CARE rating have also assigned "CARE BBB" for long term bank facilities & "CARE A3" for short term bank facilities amounting to Rs.186.5 crore. This includes existing and proposed loan.

Fixed Deposits

Company has accepted deposits from public including share holders and employees within the meaning of section 58A of the Companies Act, 1956 and rules made there under and have duly complied with the provisions of the Companies (Acceptance of Deposits) Rules 1975.

Directors'' Responsibility Statement

In terms of provisions of section 217(2AA) of the Companies Act, 1956, we confirm that :-

* Applicable accounting standards have been followed along-with explanations relating to material departures, wherever applicable.

* Directors have selected consistent & appropriate accounting policies in general. They made judgments and estimates as per reasonable and prudent practice. This will give a true and fair view of the state of affairs of company.

* Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this act for safeguarding the assets of company. This is for preventing and detecting fraud and other irregularities.

* Directors have prepared the annual accounts on a going concern basis.

Directors

Mr. K. P. Jhunjhunwala, O. P. Goyal, & Mr. B. K. Mangaraj directors of your company retire from the board by rotation and being eligible for re-appointment.

Auditors/Cost Auditors

M/s. Tibrewal Chand & Co., chartered accountants, retire as auditors of the company at the conclusion of the ensuing Annual General Meeting. They have confirmed their eligibility and willingness to accept the office of the Auditors, if re-appointed.

In pursuance of section 233-B of the Companies Act, 1956, your directors had appointed M/s. Chatterjee & Co, Kolkata as the cost auditors to conduct cost audit of cement for the year 2013-14 with the approval of the Central Government.

Particulars of Employees

Particulars of employees as required u/s 217 (2A) of the Companies Act, 1956 are not given. None of the employees were in receipt of remuneration exceeding the limits specified therein.

Foreign Exchange Earnings and Outgo

There have been no foreign Exchange earnings during the year. However, company has purchased imported coal & gypsum from the domestic market.

Conservation of Energy, Technology Absorption

A statement containing necessary information, as required under the Companies (disclosure of particulars in report of board of directors) Rules,1988 is annexed hereto in Annexure-"A".

Corporate Governance

Pursuant to Clause-49 of the listing agreement, report on Corporate Governance and the compliance certificate thereon from the auditors of the company is attached to this report.

Acknowledgements

Your directors place on record their appreciation of the assistance and support extended by government authorities, PNB, IDBI, NBFCs, consultants, shareholders, employees, suppliers & contractors of the company.

Cautionary Statement

Statements in the directors'' report and the management discussion & analysis describing company''s objectives, expectations or predictions, may be forward-looking statement within the meaning of applicable laws and regulations. Although we believe our expectation is based on reasonable assumption, actual results may differ materially from those expressed in the statement. Important factors that could influence the company''s operations include: global and domestic demand and supply conditions affecting selling prices, new capacity additions, availability of critical materials and their cost, changes in government policies and tax laws, economic development of the country, and such other factors which are material to the business operations of the company

For and on behalf of the Board

Sd/- Rourkela-769 004 R. P. Gupta Dated : 30/05/2014 Managing Director


Mar 31, 2013

Dear Members,

The gives me immense pleasure to present the 27th Annual Report. extend my thanks to all associates, shareholders & employees in particular. Your company could complete successful 27 years with their support and commitment. With this, I am pleased to present annual report along with audited accounts and Auditor''s report thereon for the financial year ended 31st March, 2013 as under :-

Financial/Operational Performance (Rs. in Lakhs)

Particulars 31/03/2013 31/03/2012 Turnover 6674.67 6388.40

Operating Income 1047.31 994.56

Other Income 40.32 36.50

PBIDT 1087.63 1031.06

Less: Interest 341.04 334.73

Cash Profit (PBDT) 746.59 696.33

Less: Depreciation & Amortization 354.40 392.75

Profit before Taxation (PBT) 392.19 303.58

This was a difficult year due to sluggish demand and rising input cost. Despite this we could increase the operating profit to 1088 lakhs as against 1031 lakhs in the previous year registering a growth of 5.4%. However, EBIDTA margin was almost stagnant in the range of 16.3% as against 16.1% in previous year. There was substantial hike in the energy cost in terms of coal, diesel and power, but specific consumption was reduced.

Future Strategies

Long term strategy and its benefit shall be derived only after completion of Phase-I expansion and the same is under progress. We have to continue our efforts improving operational efficiency to counter adversities during the interim period. However the cost economics shall totally change after commencement of expanded capacity.

Modernization & Expansion

The implementation of capacity expansion project was delayed due to delay in approvals and financial closure. Proposed expansion & modernization shall improve cost efficiency besides increasing volume. It will also help utilizing surplus and idle assets of company.

Alliance with ACC

Alliance with ACC is working satisfactorily. We express our thanks to them for their general guidance related to technical and managerial affairs. We expect full hearted support from them in future years to implement our growth plans.

Economic Scenario & Outlook

Indian economy has grown by about 5% during the year 2012-13 which was lowest in the decade. Even current scenario is no better. Rather continuous slow down since last two years is depressing the demand growth. Infrastructure investments are also slowing down due to delay in land acquisition, environment approvals, financial closure etc. Govt. has started taking corrective steps but its result shall be visible in the year 2014-15 only. Whereas 2013-14 will be a challenging year, but thereafter the situation is likely to be normalized. Rather 2015-16 is expected to be very good year for economy in general and cement industry in particular. Fundamentals of Indian economy are strong. It only needs regulatory reforms and policy initiatives.

Cement Industry Outlook & Opportunities

As discussed above, the supply overhang is likely to continue in the year 2013-14. But it shall be bottom out by the end of 2014- 15. Thereafter cement industry is likely to enter into shortage era due to slow down in new capacity additions. In general, economy is likely to revive from 2014-15 and thereby boosting the demand from housing, industrial and infrastructure sector. Keeping this scenario in view, the capacity expansion plans were slightly deferred for matching with upper cycle of cement industry.

Risks and Concerns

Continuous hike in power rate and supply deficit of coal are the major areas of concern. Indian coal quality has deteriorated. Imported coal price is going up due to rupee weakening. Company has therefore proposed in its expansion plan, latest technology of separate grinding of clinker & slag in VRM instead of conventional intermix grinding in Ball mill. This will save energy consumption, both in terms of power & fuel. Rather it will give us competitive edge over others.

Logistic cost is on increasing trend due to general increase in petroleum & energy price. Vicinity of market & location in cement deficit region will mitigate such hike in logistic cost. Supply over hang is continuing on all India basis. It is likely to continue till CY 2014. But its impact is diluted due to plant location in eastern zone. This is supply deficit zone.

Awards & Recommendations

Company was awarded first prize in Sedimentation & Water Management and second prize in Air quality management for FY 2012-13 under the Aegis of Indian Bureau of Mines, Govt. of India, Bhubaneswar during Mines Environment and Mineral Conservation Week. National Safety Awards (Mines) for 2008 to our company has been given by Hon ble President of India at New Delhi.

Human Resource

Company is maintaining cordial and healthy relations with its employees. Employees at all levels are extending their full support. Company has strong faith in potential of human resources. It believes in the creative abilities of the people, who work for company. It believes in participatory management. Wage settlement agreement is continuing. Internal Control Systems Company has an internal management audit team commensurate with the size of company. It carries out desired level of audit of various activities of company. This is with an aim to ensure that the laid down system and procedures are followed. Audit reports are presented to Audit committee of the board, which meets at periodical intervals. Continuous support and advice is also available from ACC in this area for improvement. ERP system is now fully operative. It will definitely improve overall efficiency of the company in future years.

Environmental & Social Obligation

Environment clearance from ministry of environment & forest (MoEF) has been already obtained for its proposed expansion up to 1.05 MTPA capacity. We have undertaken repairing of Telighana Basti & Telighana Church road. Tailoring centers were opened in village Telighana & Golaipara. Tuition centre was opened at Telighana village. Science exhibition was promoted at Sargu Kishan Vidyapitha. Health check up camp and Cancer detection camps were organized. Drinking water supply scheme to nearby two villages is continuing. Telighana church was electrified. Football and Hockey tournament was organized at Kandaimunda. Several supports were extended to Primary schools nearby to mines such as distribution of books, construction of boundary wall, organizing quiz competition etc. Similar supports were extended to nearby villages for organizing cultural and social programme, providing drinking water and medical assistance. The peripheral development activities during current year were substantially enlarged over previous year.

Dividend

In view of on going expansion and requirement of funds, we do not recommend any dividend for the year. Equity shares of the company continue to be listed on Bombay stock exchange and Calcutta stock exchange. We sincerely express our thanks to all shareholders for imposing their faith in the company despite delay in implementation of the expansion plan. Company has launched website during the year.

Finance

We are thankful to our Punjab National Bank for sanctioning Rs.70 crore term loan in the capacity of lead bank for the proposed expansion project. The proposal for remaining term loan of Rs.100 crore is under active consideration of the consortium members including IDBI Bank and the same is likely to be sanctioned by June/July 2013.

CARE rating have also assigned CARE BBB for long term bank facilities & CARE A3 for short term bank facilities amounting to Rs.186.5 crore. This includes existing and proposed loan.

Fixed Deposits

Company has accepted deposits from public including share holders and employees within the meaning of section 58A of the Companies Act, 1956 and rules made there under and have duly complied with the provisions of the Companies (Acceptance of Deposits) Rules 1975.

Directors'' Responsibility Statement

In terms of provisions of section 217(2AA) of the Companies Act, 1956, we confirm that :-

- Applicable accounting standards have been followed along-with explanations relating to material departures, wherever applicable.

- Directors have selected consistent & appropriate accounting policies in general. They made judgments and estimates as per reasonable and prudent practice. This will give a true and fair view of the state of affairs of company.

- Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this act for safeguarding the assets of company. This is for preventing and detecting fraud and other irregularities.

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

Directors

Mr. K. P. Jhunjhunwala, O. P. Goyal, & Mr. B. K. Mangaraj directors of your company retire from the board by rotation and being eligible for re-appointment.

Auditors/Cost Auditors

M/s. Tibrewal Chand & Co., chartered accountants, retire as auditors of the company at the conclusion of the ensuing annual general meeting. They have confirmed their eligibility and willingness to accept the office of the Auditors, if re-appointed.

In pursuance of section 233-B of the companies act, 1956, your directors had appointed M/s. Chatterjee & Co, Kolkata as the cost auditors to conduct cost audit of cement for the year 2012-13 with the approval of the Central Government.

Particulars of Employees

Particulars of employees as required u/s 217 (2A) of the Companies Act, 1956 are not given. None of the employees were in receipt of remuneration exceeding the limits specified therein.

Foreign Exchange Earnings and Outgo

There have been no foreign Exchange earnings during the year. However, company has purchased imported coal & gypsum from the domestic market. Company has incurred foreign exchange expenditures for overseas travel.

Conservation of Energy, Technology Absorption

A statement containing necessary information, as required under the Companies (disclosure of particulars in report of board of directors) Rules,1988 is annexed hereto in Annexure-A .

Corporate Governance

Pursuant to Clause-49 of the listing agreement, report on Corporate Governance and the compliance certificate thereon from the auditors of the company is attached to this report.

Acknowledgements

Your directors place on record their appreciation of the assistance and support extended by government authorities, PNB, IDBI, ACC Ltd., consultants, shareholders, employees, suppliers & contractors of the company.

Cautionary Statement

Statements in the directors report and the management discussion & analysis describing company s objectives, expectations or predictions, may be forward-looking statement within the meaning of applicable laws and regulations. Although we believe our expectation is based on reasonable assumption, actual results may differ materially from those expressed in the statement. Important factors that could influence the company s operations include: global and domestic demand and supply conditions affecting selling prices, new capacity additions, availability of critical materials and their cost, changes in government policies and tax laws, economic development of the country, and such other factors which are material to the business operations of the company.

For and on behalf of the Board

Sd/-

Rourkela-769 004 R. P. Gupta

Dated : 31/05/2013 Managing Director


Mar 31, 2012

The gives me immense pleasure to present the 26th Annual Report. I extend my thanks to all associates, shareholders & employees in particular. Your company could complete successful 26 years with their support and commitment. With this, I am pleased to present annual report along with audited accounts and Auditor's report thereon for the financial year ended 31st March, 2012 as under :-

Financial/Operational Performance (Rs. in Lakhs)

Particulars 31/03/2012 31/03/2011

Turnover 6388.40 5693.28

Operating Income 994.56 1010.96

Other Income 36.50 37.32

PBIDT 1031.06 1048.28

Less: Interest 334.73 326.80

Cash Profit (PBDT) 696.33 721.48

Less: Depreciation & Amortization 392.75 383.67

Profit before Taxation (PBT) 303.58 337.81

Turnover has increased by 12% during the year. But there was drop in operating profit by 1.6%. This was mainly on account of high input cost. Selling price was also low in second quarter. Marginal increase in interest & depreciation has further depressed profit before tax by about Rs. 34 lakh only. There was stiff hike in electricity price per unit by about 28.5%. It was partly set off due to decrease in electricity unit consumption by 4.5%. Though there was stiff hike in coal price also, but we could mitigate in part by replacing imported coal to domestic coal. Bulk purchase of imported coal and it's sale also helped to economize coal cost to some extent. Over all demand was sluggish in first three quarters. But it gained momentum in Q4. Selling price also improved in Q4.

Future Strategies

We had decided few strategies for cost reduction in previous year. Few of them are implemented. Balance implementation shall be taken up in the current year. We have further decided to produce some quantity of PPC cement to consume surplus clinker. This is likely to implement in second half of 2012-13. It's full impact will be visible during 2013-14.

Modernisation & Expansion

Phase-1 expansion plan was modified in previous year in accordance with the MOU with Govt, of Odisha. It was envisaging capacity expansion upto 1.0 MTPAby April 2013. However, the same is deferred for one year due to sluggish economy. As per revised plan, we expect commercial production by Apr/May 2014. Of course, financial closure for the revised plan is yet to be completed. It is expected by Aug/Sept 2012. The proposed expansion & modernization shall improve cost effectiveness, besides increase in volume. It will also help to utilize surplus and idle assets of company.

Alliance with ACC

Alliance with ACC is working satisfactorily. We express our thanks for their general guidance related to technical and managerial affairs. We expect their full hearted support in future years to implement our growth plans of 1 MTPAwith marketing support.

Economic Scenario & Outlook

During the year 2010-11, Indian economy has grown by about 6.5%. This was lowest growth in last 9 years. This was mainly due to investment slow down. However, government is taking corrective steps for revival. Medium term prospects are reasonably OK. But immediate concerns are, high trade deficit & high fiscal deficit. This has resulted inflation and rupee weakening. We hope, economy will be on track by 2013-14. Fundamentals of Indian economy are strong. It only needs regulatory reforms and policy initiatives.

Cement Industry Outlook & Opportunities

Due to sluggish economy, cement demand growth was also affected. It was in the range of 6-6.5% only. However, all indications are available to strengthen demand growth in the range of 8.0-8.5% in the year 2012-13. Selling price have already improved. But supply over hang is likely to continue upto CY 2013. Since new investment and capacity additions are deferred, we expect good phase for cement industry from Jan. 2014. There has been structural shift in demand. Rural demand is growing at a faster pace. Once Indian economy revives, industrial & infrastructural demand will also gain momentum. Keeping these factors in view, we had deferred the proposed capacity expansion by one year to match with industry cycle.

Risks and Concerns

Continuous hike in power rate and supply deficit of coal are major area of concern. Indian coal quality has deteriorated. Imported coal price is going up due to rupee weakening. Company has therefore proposed in its expansion plan, latest technology of separate grinding of clinker & slag in VRM instead of conventional inter mix grinding in Ball mill. This will save energy consumption, both in terms of power & fuel. Rather it will give us competitive edge over others.

Logistic cost is on increasing trend due to general increase in petroleum & energy price. Vicinity of market & location in cement deficit region will mitigate such hike in logistic cost. Supply over hang is continuing on all India basis. It is likely to continue till CY 2013. But it's impact is diluted due to plant location in eastern zone. This is supply deficit zone.

Awards & Recommendations

Company was awarded first prize in "Best general working" and "Best over all performance" on the occasion of 49th Mines Safety Week celebration. Indian Bureau of Mines, Govt, of India, Bhubaneswar awarded second prize for"Air Quality management" during 14th Mines Environment and Mineral Conservation Week.

Human Resource

Company is maintaining cordial and healthy relations with its employees. Employees at all levels are extending their full support. Company has strong faith in potential of human resources. It believes in the creative abilities of the people, who work for company. It believes in participatory management. Company has also entered into wage settlement with workers during the year.

Internal Control Systems

Company has an internal management audit team commensurate with the size of company. It carries out desired level of audit of various activities of company. This is with an aim to ensure that the laid down system and procedures are followed. Audit reports are presented to Audit committee of the board, which meets at periodical intervals. Continuous support and advice is also available from ACC in this area for improvement. During the year, ERP system was implemented. It will definitely improve overall efficiency of the company in future years.

Environmental & Social Obligation

Environment clearance from ministry of environment & forest (MoEF) has been already obtained for it's proposed expansion upto 1.05 MTPA capacity. Your company has been doing reasonable expenditure on periphery development. It has organised medical camp for surrounding villagers and employees. Cards were also issued for free medical check at designated hospitals. Water supply and street lights were provided to villages near mines. Ladies club was also formed at plant's colony. They are also involved in periphery development activities. We hope to enlarge activities in future years.

Dividend

In view of on going expansion and requirement of funds, we do not recommend any dividend for the year. Equity shares of the company continue to be listed on Bombay stock exchange and Calcutta stock exchange. We sincerely express our thanks to all shareholders for imposing their faith in the company despite delay in implementation of the expansion plan. Company has launched website during the year.

Finance

We are thankful to our banker IDBI bank. They have enhanced working capital limits in view of increased turnover. We are also thankful to BOB who have shown interest in participation of term loan for our expansion plan. In the meantime, promoters have mobilized funds through warrant subscription for part funding of on going expansion project.

CARE rating have also assigned "CARE BBB" for long term bank facilities & "CARE A3" for short term bank facilities amounting to Rs. 201 crore. This includes existing and proposed loan.

Fixed Deposits

Company has accepted deposits from public including share holders and employees within the meaning of section 58Aof the Companies Act, 1956 and rules made there under and have duly complied with the provisions of the Companies (Acceptance of Deposits) Rules 1975.

Directors' Responsibility Statement

In terms of provisions of section 217(2AA) of the Companies Act, 1956, we confirm that :-

- Applicable accounting standards have been followed along-with explanations relating to material departures, wherever applicable.

- Directors have selected consistent & appropriate accounting policies in general. They made judgements and estimates as per reasonable and prudent practice. This will give a true and fair view of the state of affairs of company.

- Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this act for safeguarding the assets of company. This is for preventing and detecting fraud and other irregularities.

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

Directors

Mr. K. P. Jhunjhunwala ,0. P. Goyal, & Mr. B. K. Mangaraj directors of your company retire from the board by rotation and being eligible for re-appointment. During the year Dr. N S Datar, director of your company has passed away. Board expresses its sincere gratitude for the services rendered by him during his tenure. This was a great loss to your company.

Auditors/Cost Auditors

M/s. Tibrewal Chand & Co., chartered accountants, retire as auditors of the company at the conclusion of the ensuing annual general meeting. They have confirmed their eligibility and willingness to accept the office of the Auditors, if re-appointed.

In pursuance of section 233-B of the companies act, 1956, your directors had appointed M/s Chatterjee & Co, Kolkata as the cost auditors to conduct cost audit of cement for the year 2011 -12 with the approval of the Central Government.

Particulars of Employees

Particulars of employees as required u/s 217 (2A) of the Companies Act, 1956 are not given. None of the employees were in receipt of remuneration exceeding the limits specified therein.

Foreign Exchange Earnings and Outgo

There has been no foreign Exchange earnings during the year. However, company has purchased imported coal & gypsum from the domestic market. Company has incurred foreign exchange expenditures for overseas travel.

Conservation of Energy, Technology Absorption

A statement containing necessary information, as required under the Companies (disclosure of particulars in report of board of directors) Rules,1988 is annexed hereto in Annexure-"A".

Corporate Governance

Pursuant to Clause-49 of the listing agreement, report on Corporate Governance and the compliance certificate thereon from the auditors of the company is attached to this report.

Acknowledgements

Your directors place on record their appreciation of the assistance and support extended by government authorities, IDBI.ACC Ltd., consultants, shareholders, employees, suppliers & contractors of the company.

Cautionary Statement

Statements in the directors' report and the management discussion & analysis describing company's objectives, expectations or predictions, may be forward-looking statement within the meaning of applicable laws and regulations. Although we believe our expectation is based on reasonable assumption, actual results may differ materially from those expressed in the statement. Important factors that could influence the company's operations include: global and domestic demand and supply conditions affecting selling prices, new capacity additions, availability of critical materials and their cost, changes in government policies and tax laws, economic development of the country, and such other factors which are material to the business operations of the company

For and on behalf of the Board

Sd/-

Rourkela-769 004 R. P. Gupta

Dated : 30/05/2012 Managing Director


Mar 31, 2011

It gives me immense pleasure to present the 25th Annual Report. Your company was incorporated in the year 1985 and commenced its commercial production in the year 1986. It has completed quarter century by now. I extend my thanks to all associates, shareholders & employees in particular. Your company could complete successful 25 years because of their support and commitment. With this, I am pleased to present the annual report along with audited statement of accounts and the Auditors report of your company for the financial year ended 31st March, 2011 as under :-

Financial/Operational Performance (Rs. in Lakhs)

Particulars 31/03/2011 31/03/2010

Turnover 5693.28 4920.36

Operating Income 1010.96 935.84

Other Income 37.32 33.01 PBIDT 1048.28 968.85

Less: Interest 326.60 306.59

Cash Profit (PBDT) 721.48 662.26

Less: Depreciation & Amortization 383.67 366.62

Profit before Taxation (PBT) 337.81 295.65

There was production loss in 4th quarter due to break downs in mill gear boxes of Raw mill and Cement mill. Hence, mills were under loaded and output was sacrificed in the interest of production continuity. This resulted into drop in despatches in the 4th quarter, which other wise, is a peak season for cement industry. Despite these constraints, the annual increase of production was 9.7% and the despatches (cement & clinker) were up by 7.4% on annual basis. Turnover increased by 15.7% and EBIDTA was up by 8.2% and PBT was up by 14.3%.

On going modernisation capex facilitated the cost reduction in quantitative terms of clinker cons, power & fuel cons. Clinker cons, was reduced by 1.53%. Scope remains for further reduction of 3-4%; which will be achieved in next two years through process optimisation. Power cons. was reduced by 15 unit/MT. Scope remains for further reduction of 3-4 units which may be achieved in subsequent years through additional capex and process optimisation.

Specific fuel cons, per MT (cement & surplus clinker) was reduced from 16.7% to 13.4%, hence achieving 20% economy in quantitative terms. This was partly due to process optimization and partly due to coal quality improvement. During the year, avg. power rate has gone up by Re.0.64 per unit i.e. by 17.9%. Avg. coal price has gone up by Rs. 168/- per MT i.e. up by 6.6%. Cost of slag has gone up nearly by 50%. Freight cost has also gone up for inward & outward materials. Despite such stiff hike in input cost, company could manage the production cost almost in the same level of previous year through additional capex and process optimization.

Future Strategies

Major cost saving shall be achieved only after implementation of proposed capacity expansion and modernisation. During interim period (about 11/2 yrs) we have adopted following strategies to curtail production cost and to improve cost effectiveness :-

- To undertake and to continue with such modernisation capex which are part of ultimate capacity expansion.

- To reduce clinker, power & fuel consumption through further process optimisation.

- To improve capacity utilisation and to dilute fixed and semi-variable cost.

- Part replacement of imported Gypsum by domestic Gypsum.

- Bulk purchase of Raw material to economise purchase cost.

With these strategies, we hope to combat in part about rise in input cost, of course; balance has to be passed on to consumer.

Modernisation & Expansion

The commercial production of the expanded capacity (upto 0.66 MTPA) was envisaged in FY-2012. However during the year under review your company has decided to expand the capacity to 1.0 MTPA for long term viability. The modification

of the plan was in accordance with the MOU with Govt. of Odisha entered on 27/04/2011 and also on recommendation of ACC Ltd. Due to modification in the expansion plan, the commercial production of expanded capacity is now envisaged by April, 2013.

The revised plan envisages world reputed make VRM for cement grinding which will be highly economical in terms of clinker & power consumption. The expansion will also facilitate to dilute the fixed cost and utilisation of idle assets & surplus infrastructure. The Board has also formed the Project Management Committee to monitor the progress of capacity expansion project.

Alliance with ACC

During the year, ACC nominated Sri Vivek Chawla as second ACC nominee director on the Board. He joined the Board on 29/04/2010. He is presently working as Chief Executive (East Region) in ACC Ltd.

Environmental & Social Obligation

Environment clearance from Ministry of Environment & Forest (MoEF) has been already obtained for its proposed expansion upto 1.05 MTPA capacity. Your company has been doing reasonable expenditure on periphery development. It is also committed to gear it up for future years.

Sharesholders Dividend / Bonus

In view of on going expansion and requirement of funds, we do not recommend any dividend for the year. During the year under review, the company has issued bonus share to the shareholders, the amount of Rs. 3491.14 lakhs standing credit to the companys securities Premium account out of which an amount of Rs. 340.00 lakhs was capitalised and applied in paying up fully paid up 170.00 lakhs Equity Shares of Rs.2/- each in the capital of the Company, to distribute as fully paid bonus shares to the members of the company, including 126.36 lakh Equity Share Warrants to be converted into Equity Shares as on record date 11/12/2010.

The Equity Shares of the Company continue to be listed on Bombay Stock Exchange Limited and The Calcutta Stock Exchange Association Limited. Total no. of shareholders has increased from 40,959 nos. to 41770 nos. during the year. We sincerely express our thanks to all shareholders for imposing their faith in the company despite delay in implementation of the expansion plan.

Finance

We are thankful to our banker IDBI Bank who had sanctioned Term loan for our expansion plan in May, 2010. However, we have already submitted the revised expansion plan upto 1.0 MTPA as against original plan of 0.66 MTPA. We hope for favourable consideration by IDBI Bank. In the meantime, promoters have mobilized funds through warrant subscription for part funding of on going expenses related to expansion project.

Fixed Deposits

The Company has accepted deposits from public including share holders and employees within the meaning of Section 58A of the Companies Act, 1956 and rules made there under and has duly complied with the provisions of the Companies (Acceptance of Deposits) Rules 1975.

Directors Responsibility Statement

In terms of provisions of Section 217(2AA) of the Companies Act, 1956, your Directors confirm that :-

- In the preparation of the annual accounts, the applicable accounting standards have been followed along-with proper explanations relating to material departures, wherever applicable.

- The Directors have selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company, as at the end of the financial year and of the Profit of the Company for the year ended on that date.

- The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company, and for preventing and detecting fraud and other irregularities.

- The Directors have prepared the annual accounts on a going concern basis.

Directors

During the year ACC Ltd. withdraw its nomination for Mr. Vivek Agnihotri as Alternate Director to Ramit Budhraja, IPICOL, Govt. of Odisha nominated Mr. D K Senapati as Nominee Director in place of Sri S B Satpathy. The Board place on record its gratitude for the services rendered by the two director during the tenure as member of the Board.

Mr. K P Jhunjhunwala, Mr. O P Goyal & Mr. B. K. Mangaraj, Directors of your Company retire from the Board by rotation and being eligible for re-appointment.

Auditors / Cost Auditors

M/s. Tibrewal Chand & Co., Chartered Accountants, retire as Auditors of the Company at the conclusion of the ensuing Annual General Meeting and have confirmed their eligibility and willingness to accept the office of the Auditors, if re- appointed.

In pursuance of Section 233-B of the Companies Act, 1956, your directors had appointed M/s. Chatterjee & Co, Kolkata as the Cost Auditors to conduct the Cost Audit of Cement for the year 2010-11 with the approval of the Central Government.

Particulars of Employees

The Particulars of employees as required u/s 217 (2A) of the Companies Act, 1956 are not given as none of the employees were in receipt of remuneration exceeding the limits specified therein.

Foreign Exchange Earnings and Outgo

There has been no foreign Exchange earnings during the year. However, company has purchased imported Coal & Gypsum from the domestic market. Company has incurred foreign exchange expenditures for overseas travel and payment to international consultants.

Conservation of Energy, Technology Absorption

A statement containing necessary information, as required under the Companies (Disclosure of particulars in the Report of Board of Directors) Rules, 1988 is annexed hereto in Annexure - "A".

Corporate Governance

Pursuant to Clause-49 of the listing agreement, Report on Corporate Governance and the Compliance Certificate thereon from the Auditors of the Company is attached to this report.

Acknowledgements

Your directors place on record their appreciation of the assistance and support extended by the Government Authorities, IDBI, ACC Ltd, Consultants, Shareholders, Employees, Suppliers & Contractors of the Company.

For and on behalf of the Board Sd/-

R. P. Gupta Managing Director

Rourkela-769 004

Dated : 28/05/2011


Mar 31, 2010

The directors have pleasure in presenting the 24th AnnuaI Report along with audited statement or accounts and the Auditors Report of your company for the financial year ended 3lst March, 2010 as follows :-

Financial/Operational Performance (Rs in Lance)

Particulars 31/03/2010 31/03/2009

Turnover 4320.36 3146.38

Operating Income 935.84 418.81

Other Income 33.01 27.83

PBIDT 968.85 446.64

Less Interest 306.59 123.97

Cash Profit (PBDT) 682.26 322.67

LESS: Depreciation & Amortlzation 366.62 268.74

Profit before Taxation (PBT) 295.65 53.93



There was loss of production in 4th quarter By 16.2% due to power cuts for the first time. This has resufled into drop in despatches (cement & clinker) by 14.7% despite good demand. Kiln was under planned shut down for 62 days in 2nd & 3rd quarter to undertake modernisation capex affecting cf inker production. Despite these constraints, the annual increase of production was 21.3% and hence, the despatches (cement & clinker) were up by 23.2% on annual basis. Turnover increased by 56.4% and EBIDTA was up by 216.9% and PBT was up by 548%.

Modernisation capex in the prevws year facilitated the cost reduction in quantitative terms of clinker cons. power & fuelcons. Clinker cons. was reducced by 1.95%. Scope remains for futher reduction of 4-5%: which will be achieved in next two years through process optimisation. Power cons. was reduced y 2 units/MT. Scope remains for futher reduction of 4-5 units which may be achieved in next two years through process optimisation.

Specific fuel cons. per MT (cement & surplus clinker) was reduced from 18.13% ti 16.72%, hence achiecing 8% replaced.

During the year, avg. power rate has gone up by Rs. 0.13 per unit i.e. by 3.8%. Avg coal price has gone up by Rs.836%-per MT i.e. up by 48.7%. This was mainly due to higher propportion of impported coal due to bad quality of domestic coal. Gypsum price has gone up by Rs. 685/-per MT. i.e. up by 29.2%. Further road transport and rail transpoer cost has also gone up. This resulted into inctease in production cost despote savings in quantitative consumption. However, tazation cost was reduced to partly compansate the increase of production cost. Growth in demand has also helped to pass on the impact to consumers. Hence. we could achieve increase in PBIDT from 14.2% to 19.7%.

Future Strategles

Major cost saving shall be achieved only after implementation of proposed capacity expansion and modernisation. During interim period (about 1 1/2yrs) we have adopted following stratigies to curtail production cost and to imporve cost effectiveness:-

- To undertake and to continue with such modermisation capex which are part of ultimate capacity expansion.

- To reduce clinker, power & fuel consumption through futher process optmisation.

- To improve capacity utllisation and to dilute fixed and semi-variable cost.

- Part replacement of imported Gysum by domestic Gysum.

- Bulk purchase of Raw material to economise purchase cost. Also to opt for railway transportation instead of road transportation wherever feasible in case of bulk prchase.

With these strateglies, we hope to combat in part about rise in input cost, of course: blance has to be passed on to consumer,

Modernisation & Expansion

Phase-1 capacity expansion upto 0.66 Mn. TPA is already under initial stange of implementation. It will be geared up in FY 10-11 The proposed scheme envisages following:-

- Modemisation of existing mills to exploti in-built capacity and to achieve power economy.

- Major changes in the kiln to replace Pyro circuit and firing circuit as whole besides installation of new PH tower. Precalciner and efficient clinker cooler. This will result into power & fuel economy beside increase in production

- To adopt separate grinding of slag and cliner so as to optimixe particle size control and to bring clinker consumption to a level of 40-45%.

- To install latest technology VRM in lieu of Ball mill for cement grinding for poewer saving.

- Total mechanization of mines and material handling in the plant to economize labout cost.

As per plan submitted to the lenders, the commercial production of the expaned capacity is envisaged in FY 12. We expect to achieve substantial economy after expansion in terms of clinker, power & fuel consumption as wwell as cost of mining. The fixed cost shall also be diluted due to utillsation of idle assets and surplus infrastructure and increase of volume.

Alliance with ACC

During the year, Mr. Paul Hugentobler, Asia Head, HOLCIM Geoup & Mr. Sumit Banerjee, ME-ACC Ltd visted the plant. They expressed satisfaction with on going allinace. Susequently. ACC has requsted to appoint Shri Vivek Chawla, another nominee director on the Board. ACC has been providing technical services from to time to imporve performance.

Economic Scenario & Outlook

During the year 08-09, there was global slow down of the economy. Indias GDP was also affected during 08-09 due to intergration of financial market across the world. However, duw to inherent fundamental strength of the country clubbed with timely action by our Govt (through fiscal stimulus,) our county could reverse the slow down in the shortest time span. GDP growth of the country during the year 09-10 is estimated as 7.5% as against 6.7% during FY-09 despite weak monsoon. During the year, Indian economy performed better than most of other countries. Idia is being considered as most preferred destination for investment and forex inflow has been satisfactory. Out Govt, has projucted average 9% growth rate in coming years.

Hoerver, there are still few areas of concem. Infrastructure spending has to be increased with active participation of private players. Necessary reforms in taxation and administrative areas are essential to promote savings and investment. Subsidies are to be phased out to curtail fiscal deficit. Trade deficit is a serious concem and requires suitable policy initiative. Rural infrastucture is to be created to avhieve inclusive growth. Cost of fuel, energy & transportation is to be broutht down to contain inflationary trend as well as to compete for expoers. Cheap capital and favourable inbestment climate is equally essential to promote inbestment and to build up fresh capacities to contain inflation .

Nevertheless, over all economic outlook of the country is generally favourable and promising than most of the countries. It is likely ot continue for next 5 years.

Cement Industry Outlook & Opportunities

Demand growth during the year in the country was exceeding 12%. Demand growth in Eastern zone was exceeding 22% during the year. The principal reason was higher infrastucture spending clubbed with rural demand. Growth secenario of the country is likely to remain 10-12% for next 5 years, Wrowth of Eastern zone is likely to remain above india average due to massive industrialisation.

The installed capacity in the country has reached about 250 Mn. T by Mar2010. Another 65 Mn. T capacity is likely to be added in coming two years i.e. FY-12 Bunchinf of capacity during these two years may create supply over hang to some extent, despite robust growth in demand. Capacity additions in the country are not evenly distributed and hence, regional imbalance of supply and demand shall futher enlarge. Deficit in Eastem zone may further go up. But post FY-12 demand in entire country is likely to exceed supply/production. Looking into robust demand growth in Eastem zone and considering post FY-12 scenario. our expansion plan timing is matching well.

Risks and Concerns

Though at the beginning of the year, there was apprechension about pressure on pricing front during 2nd half of FY-10, but the price remained from due to unprecedented growth of demand. The proposed capacity addition during FY 11-12 may cause pressure on procing front from Jul 10. But such suuply over hang may not be severe in nature due to robust demand growth. Availability of good quality coal at affordable rate is definitely a concern. High fright cost by road and inadequate supply of railway wagons is another area of concern Industry is also worrled on power tariff hike So as to combat the illaffects, we have decided future strategies for medium thrm as discussed above. However, for long term measures, we have planned for capacity expansion adopting latest technology.

At present Excise duty on cement is being levied on MRP without abtement benefites unlike other products. This translates into high taxation tate on Ex-works price in comparison to other core sector industry like Steel. Similarly. VAT rate is almost 3 times in comparison to Steel. This matter has been represented to Govt. In case Govt. considers favourably, the rise in input cost will be set off to some extent. Allernatively, cement industry has to pass on the impact of input cost ot the consumer, which may affect demand.

Awards & Recommendations

The Business Today magazine has rated your company at 951 rank for the year 2009. In the year 2008, it was ranked at 946 position.

Director General-Mines Safety, Dhanbad under Mnistry of Labour & Employment Govt of india, Chaibeasa Region awarded First prize for "over all perfomance" during the year 2009. Indian Bureau of Mins, Govt fo India, Bhubaneswar awarded First prize for "Sedimentation & Water Management" for the year 2010 and Second prize for "Air Quality Management" for the year 2010.

Human Resource

Company is maintatning cordial relations with its employees. Long term wage settlemt with company workers has expired on 31/10/09 and with contractor workers it is going to expire by 30/04/10. The negotiations are continuing and we hope to reach to an amicable settlement shortly. Pending wage setterment of workers, the increament/promotions of staff & officers have been deferred, which are other wise effective from Jan.2010.

Internal Control Systems

The company has an termal Management audit team commensurate with the size of the company. It carries out desired level of audit of various spheres of activities of the company to ensure that the laid down system and procedures are ade1qute and being followed. The audit reports are preented to the year. Continuous support and advice is available from ACC in this area. We are going to introduce ERP system for integration and computation of datas generated from various Deptt. The work order has been placed and the installation is continuing. It is likely to come into operation by Q-2 of FY-11. It will definitely Improve overall efficiency of the company.

Envlronmental & Social Obllgation

The consent form Orissa State Pollution Control Board has been renerwed upto 31-03-2011 for the plant and mines. We have already recived Terms of Reference (TOR) from Ministry of Environment & Forest (MOEF) related to its expansion project encisaging clinkering capacity of 1.3 Mn. TPA and cement capacity 1.0 Mn. TPA at Kutra plant. Comapny is in a process to comply with TOR. Your Company has been doing reasonable expenditure on periphery development. It is also committed to gear it up for future years.

Sharesholders/Share capital/Dividend

In view of om going expanision and equirement of funds, we do not recommend any dividend for the year. During the year under review, the Company has increased its Authorised haare capital from Rs. 40 crore to Rs.46 crore divided into 228750000 equity shares of Rs.2/-each and 1250000 preference shares of Rs.2/ each at the shareholders meeting held on 08-01-2010. The Equity Shares of the Company continue to be listed on Bombay Stock Exchange Limited and the Calcultta Stock Exchange Association Limited. Company has also taken effective steps to list with National Stock Exchange. Total no. of shareholders has increased from 40,804 nos. to 40,959 nos. during the year. Shareholders have approved allotment of 10 Mn. Shares to romoter group at a price of Rs. 11/per share. However, the approcal from the Stock Exchange is awaited before final allotment.

Funance

Your company has submitted application for additional Term loan and Working capital for the proposed expansion to its existing banker IDBI Bank Ltd. We hope to receive the sanction by May10 looking into our excellent relation with existing banker. We have also mobilized funds through warrant subscription and unsecured loan for part funding of on going expenses related to expanision project.

Fixed Deposits

The Company has acepted deposits form public including share holders and employess withon the maning of Section 58A of the Companies Act, 1956 and rules made there under and has duly complied with the procisions of the Companies (Acceptance of Deposits) Rules 1957.

Directors Responsibility Statment

In terms of provisons of Section 217 (2AA) of the Companies Act. 1956, your Directors confirm that:-

(i) In the preparation of the annual accounts, the applicable accounting staderds have been followed along-with proper explantions realting to material departures. therever applicable.

(ii) The Directors have slected 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 affars of the Company. as at the end of the financial year and of the Profit of the Company for the year ended on that date.

(iii) The Directors have taken proper and suffcient care for the maintencance of adequate accounting records in accordance with the procisions of this Act for sageguarding the assets of the Company, and for preventing and detecting fraud and other irregularities.

(iv) The Direcotes have prepared the annual accounts on a going concem basis.

Directors

During the year Mr. B C Srivastava resigned from the directorship on health/personal ground. The Board place on record its gratitude for hte services reandered by Mr. B.C. Sribastava the thnure as member of the Board. Dr. N.S. Datar was appointed as Independent director. He was Ex-MD of SAIL-Rourkela Steel Plant and presently director in Uttam Galva Steel Ltd.

Mr. O.P. Goyal, Mr. B.K. Managaraj & Dr. N.S. Datar Directors of your Company retire from the Board by totaion and being ellgible for re-appontment.

ACC Ltd. has requsted to appoint Mt. Vivek Chawla as another nominee director and also requested to applint Mt. Vivek Agnihotri as altemate director to Mt. Ramit Budhraja. The proposal shall be taken up in the next Board meeting for approval.

Audirots/Cost Auditors

M/S Tibrewal Chand & Co., Chartered Accountants, retire as Auditors of the Company at the conclusion of the ensuing Annual General Meeing and have confirmed their ellgibility and willingness to accept the office of the Auditors. if reapointed.

In pursuance of Section 233-B of the Companies Act. 1956, your directors had appointed M/S. Chatterjee & Co. Kolkata as the Cost Auditors to conduct the Cost Audit of Cement for the year 2009-10 with the approval of the Central Govement.

Particulars of Employees

The Particulars of employess as required u/s 217 (2A) of the Companies Act, 1956 are not given as none of the employees were in receopt of remueration exceeding the limits sepcified therein.

Forelgn Exvhange Earnings and Outgo

There has been no forign Exchange earnings or outgo (direct) during the year. However, compoany has purchased imported coal and gypsum form the domestic market.

Conservation of Energy, Technology Absorption

A statement containg necessary information, as required under the Companies (Disclosure of particulars in the Reprt of Board of Directors) Rules, 1988 is annexed hereto in Annexure-"A".

Corporate Gevernace

Pursuant to Clause-49 of the listing agreement, Report on Corport on Corporate Governance and the Comptificate thereon from the Auditors of the Company is attached to this report.

Acknowledgements

Your directors place on record their appreciation of the support extended by the Govemment Authorities, IDBI, ACC Ltd, Consultants, Shareholders and employees of the Company.



For and on behalf of the Board

Rourkela -769 004 Sd/-

Dated:29-04-2010 R.P. Gupta



Managing Directors

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