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Directors Report of Solar Industries India Ltd.

Mar 31, 2015

Dear Members,

The Directors have great pleasure in presenting the 20th Annual Report on the business and operations of the Company together with the Audited Balance Sheet and Profit & Loss Accounts for the year ended on March 31, 2015.

FINANCIAL HIGHLIGHTS

(Rs. in Lakhs)

STANDALONE CONSOLIDATED PARTICULARS 2015 2014 2015 2014

Net Revenue from operations 103458.00 92112.55 135979.92 114411.61

Less: Expenditure 85932.98 78141.33 109787.72 92998.04

Operating profit (PBIDT) 17525.02 13971.22 26192.20 21413.57

Interest 723.83 1448.24 1785.12 1785.65

Profit before Depreciation & Tax (PBT) 16801.19 12522.98 24407.08 19627.92

Less: Depreciation 1766.20 1257.36 3145.33 2186.92

Profit before Tax & Exceptional item 15034.99 11265.62 21261.75 17441.00

Less: Exceptional item 1000.14 1000.14 1000.14 1000.14

Profit before Tax 14034.85 10265.48 20261.61 16440.86

Less: Provision for Taxation 3242.51 1881.04 4628.30 3490.38

Profit after Tax 10792.34 8384.44 15633.31 12950.48

Share of profit transfer to minority 892.62 1106.29

Stock Reserve 485.44 28.47

Balance brought forward 15746.87 12251.45 26186.19 21251.62

Balance available for appropriation 26539.21 20635.89 41412.31 33124.27

Appropriation:

Interim Dividend 1447.84 904.90 1457.94 886.68

Proposed Dividend 1628.82 1266.86 1628.82 1266.86

Tax On Dividend 332.19 217.24 515.74 284.54

Adjustment of Taxes 19.95

Adjustment of Depreciation 582.51 693.42

General Reserve 3000.00 2500.00 5000.00 4500.00

Balance Profit Carried To Balance Sheet 19547.85 15746.87 32096.44 26186.19

Earning Per Share (EPS) 59.63 46.33 81.45 65.44

RESULTS OF OPERATION

Standalone Reaching

* During the financial year ending on March 31, 2015 the Company achieved turnover of Rs. 11 1684.56 lacs as against turnover of Rs. 98551.23 lacs achieved during the previous year, which is a significant increase in turnover by 13.33 %.

* The Profit After Tax (PAT) for the financial year 2014 - 15 is Rs. 10792.34 lacs against Rs. 8384.44 lacs in the previous year 2013-14.

* Profit before Interest, Depreciation, Amortisation, Exceptional Items & Tax stood at Rs. 17525.02 lacs as against Rs. 13971.22 lacs in the previous year.

* Earnings Per Share as on March 31, 2015 is Rs. 59.63 vis a vis against Rs. 46.33 as on March 31, 2014.

* The net worth of the Company has increased and stands at Rs. 52360.37 lacs for the fiscal year 2014 - 15 from Rs. 45559.38 lacs of the previous fiscal year 2013 - 14.

Consolidated Reaching

* During the financial year ending on March 31, 2015 the Company achieved turnover of Rs.146285.63 lacs as against turnover of Rs. 122377.53 lacs achieved during the previous year, which is a significant increase in turnover by 19.54%.

* The Profit After Tax (PAT) after transferring the share of profit of Minority Interest for the financial year 2014 - 15 is Rs. 14740.69 lacs against previous year Rs. 11844.19 lacs in 2013-14.

* Profit before Interest, Depreciation, Amortisation, Exceptional Items & Tax stood at Rs. 26192.20 lacs as against Rs. 21413.55 lacs in the previous year.

* Earnings Per Share as on March 31, 2015 is Rs. 81.45 vis a vis against Rs. 65.44 as on March 31, 2014.

* The net worth of the Company has increased and stands at to Rs. 77588.29 lacs in the fiscal year 2015 from Rs. 66157.41 lacs at the end of fiscal year 2014.

APPROPRIATIONS:

DIVIDEND:

Summary of Final Dividend declared by the Company in the year 2014 and recommended for the year 2015 are given below:

(Rs. inLakhs)

2014 70% 1266.86 217.24 1484.10

2015 (if approved 90% 1628.82 332.19 1961.01 by members)

Your Directors recommend a Final Dividend of 90% (Rs. 9/- per Equity Share of Rs. 10/- each) to be appropriated from the profits of the year 2014 - 15, subject to the approval of the shareholders at the ensuing Annual General Meeting. The Dividend will be paid in compliance with applicable regulations.

Pursuant to the approval of Board of Directors on November 10, 2014, your company had distributed an interim dividend of Rs. 8/- per share, on face value of Rs. 10/- each.

The total dividend for the year ended on March 31, 2015 would accordingly be Rs. 17 per Equity share (170% of face value) as against the total dividend of Rs. 12 per Equity Share (120% of face value) for the year ended on March 31, 2014. The total outgo due to Dividend of the Company is Rs. 3,602.50 lacs, including dividend distribution tax as against Rs. 2,438.08 lacs in the previous year. The Dividend payout Ratio of your Company is 24.44%.

TRANSFERS TO RESERVES:

The Company has transferred Rs. 5,000.00 lacs to the general reserve out of the amount available for appropriations and an amount of Rs. 32,096.44 lacs is proposed to be retained in the statement of profit and loss.

CREDIT RATINGS:

CRISIL has upgraded its ratings on the for long term borrowings of Solar Industries India Ltd (SIIL) to "CRISIL AA/Stable" from "CRISIL AA/- Positive". The ratings reflect SIIL'S strong market position, good operating efficiencies (backed by prudent raw material procurement policies and backward integration), and strong debt protection measures. To arrive at its ratings, CRISIL has combined SIIL's financial and business profiles with those of its subsidiaries.

In addition to long Term rating, CRISIL has also re-affirmed the rating of Short Term Borrowings of the SIIL to "CRISIL A1 ".

SUBSIDIARY OPERATIONS:

As a purposeful strategy, your Company carries all its business operations through several subsidiaries and associate companies which are formed either directly or as step-down subsidiaries or in certain cases by acquisition of a majority stake in existing enterprises.

Incorporation of Step down Subsidiaries during the year:

During the year under review, two step down overseas subsidiaries were incorporated following are details;

1. Solar Industries Africa Limited in Mauritius through subsidiary Solar Overseas Mauritius limited.

2. Solar Mining Services Pty Ltd in South Africa through our step down subsidiary Solar Overseas Netherlands Cooperative U.A.

ACQUISITION:

Post March 31, 2015 the Company has acquired the following;

1. 498766 Equity Shares aggregating to 100% stake of M/s Blastec (India) Private Limited.

2. 4977700 Equity Shares aggregating to 100% stake of M/s Emul Tek Private Limited.

Accordingly, M/s Blastec (India) Private Limited and M/s Emul Tek Private Limited are the wholly owned subsidiaries of your company.

AUDITED FINANCIAL STATEMENTS OF THE COMPANY'S SUBSIDAIRES

The Board of Directors of your Company at its meeting held on May 25, 2015, approved the Audited Consolidated Financial Statements for the financial year 2014 - 15 which includes financial information of all its subsidiaries, and forms part of this report. The Consolidated Financial Statements of your Company for the financial year 2014 - 15, have been prepared in compliance with applicable Accounting Standards and Listing Agreement requirement as prescribed by the Securities and Exchange Board of India.

A report on the performance and financial position of each of subsidiaries of your Company including capital, reserves, total assets, total liabilities, details of investment, turnover, etc., pursuant to Section 129 of the Companies Act, 2013 in the Form AOC-1 forms part of this report.

In accordance with Section 136 of the Companies Act, 2013, the audited financial statements, including the consolidated financial statements and related information of the Company and audited accounts of each of its subsidiaries, are available on our website www.solargroup.com. These documents will also be available for inspection during business hours at our registered office of the Company

The policy determining the material subsidiaries as approved may be accessed on the Company's website at the link http://solargroup.com/uploads/investors/policies/PDMS.pdf

DEPOSITS

During the year the Company has not accepted deposits from the public falling within the ambit of Section 73 of the Companies Act, 2013 and the Companies (Acceptance of Deposits) Rules, 2014.

DIRECTORS:

Director's Retiring by Rotation

In terms of Articles of Association of the Company and as per Section 152(6) of the Companies Act, 2013 provides that 2/3rd of the Board of Directors is considered to be Directors liable to retire by rotation, of which 1/3rd shall retire at every Annual General Meeting of the Company as per Section 152(6) (e) of the Companies Act, 2013 and the Company shall have an option to re-appoint the retiring Director or appoint someone else in his place.

This year Shri Manish Nuwal (DIN 00164388) shall retire by rotation and being eligible offer himself for re-appointment at this Annual General Meeting.

The Boards of Directors have recommends his re-appointment for consideration of the Shareholders.

The brief resume and other details relating to Shri Manish Nuwal (DIN 00164388) who is proposed to be re-appointed, as required to be disclosed under Clause 49 of the Listing Agreement, is incorporated in the annexure to the notice calling 20th Annual General Meeting of the Company.

DIRECTOR'S APPOINTMENT

a) Shri Anil Kumar Jain

In accordance with Section 161 of the Companies Act, 2013 and of the Articles of Association of the Company, Shri Anil Kumar Jain (DIN: 03532932) was appointed as a Director in casual vacancy with effect from May 25, 2015. Shri Anil Kumar Jain would hold office till the conclusion of this Annual General Meeting of the Company scheduled to be held on September 9, 2015.

The requisite notices together with necessary deposits have been received from a Director pursuant to Section 160 of the Companies Act, 2013, proposing the election of Shri Anil Kumar Jain as an Executive Director of the Company.

b) Smt Madhu Vij

Mrs. Madhu Vij (DIN 00025006) was appointed as an Additional Director by the Board of Director w.e.f. March 23, 2015 in accordance with the provisions of Section 161 of the Companies Act, 2013 and of Article of Association of the Company.

Pursuant to Section 161 of the Companies Act, 2013 the above director holds office up to the date of this 20th Annual General Meeting.

The Company has received request in writing from a member of the company pursuant to Section 160 of the Companies Act, 2013 proposing the candidature of Mrs. Madhu Vij for appointment as Non-Executive Independent Director of the Company.

DIRECTOR'S CESSATION Shri Kundan Singh Talesra

Shri Kundan Singh Talesra, Executive Director has stepped down from the Board effective from May 25, 2015. The Directors wish to record their gratitude and appreciation for the wise counselling and contributions by Shri Kundan Singh Talesra during his tenure as a Director of the Company. Attention of the Members is invited to the relevant item in the Notice of the Annual General Meeting and the Explanatory Statement thereto.

DECLARATION OF INDEPENDENT DIRECTORS

The Independent Directors have given declarations that they meet the criteria of independence, as laid down under Section 149(6) of the Companies Act, 2013 and Clause 49 of the Listing Agreement.

KEY Managerial PERSONNEL

Pursuant to the Section 203 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 and other applicable provisions and rules of the Companies Act, 2013 following existing executives of the Company were designated as the Key Managerial Personnel of the Company on May 26, 2014.

* Shri Satyanarayan Nuwal - Chairman and Executive Director,

* Shri Kailashchandra Nuwal - Executive Director,

* Shri Manish Nuwal - Executive Director,

* Shri Kundan Singh Talesra - Executive Director and Chief Executive Officer,

* Shri Roomie Dara Vakil - Executive Director,

* Shri Nilesh Panpaliya - Chief Financial Officer

* Mrs. Khushboo Pasari - Company Secretary

However, as Shri Kundan Singh Talesra, Executive Director and CEO of the Company has stepped down from the Board on May 25, 2015, the Board of Directors of the Company has appointed Shri Manish Nuwal as a Chief Executive Officer in his place.

Further, Shri Anil Kumar Jain, Director has also been designated as Key Managerial Personnel being Executive Director of the Company in place of Shri Kundan Singh Talesra.

BOARD EVALUATION

Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing Agreement, the Board has carried out an annual performance evaluation of its own performance, the performance of directors in individual capacity as well as the evaluation of the working of its Audit, Nomination & Remuneration, Stakeholder Relationship and Corporate Social Responsibility Committees. The manner in which the evaluation has been carried out has been explained in the Corporate Governance Report.

REMUNERATION POLICY

The Board has, on the recommendation of the Nomination & Remuneration Committee framed a policy for selection and appointment of Directors, Senior Managerial Personnel and their remuneration. The Remuneration Policy is stated in the Corporate Governance Report.

ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The information on conservation of energy, technology absorption and foreign exchange earnings and outgo stipulated under Section 134(3) (m) of the Companies Act, 2013 read with Rule, 8 of The Companies (Accounts) Rules, 2014, is annexed herewith as "Annexure A".

AUDITORS

Statutory Auditors

Pursuant to the provisions of Section 139 of the Companies Act, 2013 and the Rules made there under, M/s Gandhi Rathi & Co. Chartered Accountants had been appointed as Statutory Auditor of the Company in the 19th Annual General Meeting of the Company who are eligible to hold the office for a period of three years until the conclusion of the 22nd Annual General Meeting subject to ratification in every Annual General Meeting of the Company.

Accordingly, the appointment of M/s Gandhi Rathi & Co. Chartered Accountants the current Statutory Auditors of the Company is ratified up to the conclusion of the 21st Annual General Meeting to be held in the year 2016.

The Notes on Financial Statements referred to in the Auditors' Report are self-explanatory and do not call for any further comments.

There were no adverse remarks or qualification on accounts of the Company from the Statutory Auditors. The Report of Auditors of the Company M/s Gandhi Rathi & Co., Chartered Accountants on the Annual Accounts of Solar Industries India Limited Standalone and Consolidated with Subsidiary Companies forms part of this report.

Cost Auditors

Pursuant to the provisions of Section 148 of the Companies Act, 2013 and The Companies (Cost Records and Audit) Amendment Rules, 2014, the Cost Audit of the Cost and related records of the Company for the year 2014 - 15 was undertaken by Shri Deepak Khanuja, Partner of M/s Khanuja Patra & Associates, Nagpur the Cost Auditor of the Company.

There were no adverse remarks or qualification on accounts of the Company from the Cost Auditors.

The Board of Directors of the Company as per Section 148 of the Companies Act, 2013 read with The Companies (Cost Records and Audit) Amendment Rules, 2014 had, on the recommendation of the Audit Committee, appointed Shri Deepak Khanuja, Partner of M/s Khanuja Patra & Associates, Cost Accountants to audit the cost records of the Company for the financial year 201 5 on a remuneration of Rs. 1,00,000/- (Rupees one lakh only). As required under the Companies Act, 2013, the remuneration payable to the cost auditor is required to be placed before the Members in a general meeting for their ratification. Accordingly, a Resolution seeking Member's ratification for the remuneration payable to Shri Deepak Khanuja, Partner of Khanuja Patra & Associates, Nagpur, Cost Auditors is included at Item No. 8 of the Notice convening the 20th Annual General Meeting of the Company.

Internal Auditors

Pursuant to the provisions of Section 139 of the Companies Act, 2013 and The Companies (Accounts) Rules, 2014, during the year under review the Internal Audit of the functions and activities of the Company was undertaken by the Internal Auditors of the Company on quarterly basis by M/s B. K Banka & Associates, M/s Ekbote Deshmukh & Co. and M/s Patel Madan Malpani & Co. the Internal Auditors of the Company.

There were no adverse remarks or qualification on accounts of the Company from the Internal Auditors.

M/s B. K Banka & Associates, Chartered Accountant the Internal Auditor of the Company has resigned. However, the Board of Directors of the Company has appointed M/s Ekbote Deshmukh & Co. Chartered Accountants and M/s Patel Madan Malpani & Co. Chartered Accountants, to conduct the Internal Audit as per Rule 13 of the Companies (Accounts) Rules, 2014 prescribed under Section 138 of the Companies Act, 2013 for the financial year 2015 - 2016.

SECRETARIAL AUDIT

Pursuant to the provisions of Section 204 of the Companies Act,

2013 and The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Secretarial Audit for the year 2014 - 15 was undertaken by Shri Anant B. Khamankar, Practising Company Secretary the Secretarial Auditor of the Company.

The Report of Auditors of the Company M/s Anant B Khamankar & Co., Company Secretaries on the Secretarial and related records of the Company is annexed herewith as "Annexure B".

There were no adverse remarks or qualification on accounts of the Company from the Secretarial Auditors.

The Board of Directors of the Company appointed Shri Anant B. Khamankar, Practising Company Secretary, to conduct the Secretarial Audit as per Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 prescribed under Section 204 of the Companies Act, 2013 for the financial year 2015 - 2016.

SHARE CAPITAL

The paid up Equity Share Capital as on March 31, 2015 was 1809.80 Lakhs. During the year under review, the Company has not issued shares with differential voting rights nor granted stock options nor sweat equity.

EXTRACT OF ANNUAL RETURN

The details forming part of the extract of the Annual Return in form MGT 9 is annexed herewith as "Annexure C"

MEETINGS

Board of Directors

During the year Five Board Meetings were convened and held on May 26, 2014, August 04, 2014, November 10, 2014, January 22, 2015 and March 23, 2015. The details of which are given in the Corporate Governance Report. The intervening gap between the Meetings was within the period prescribed under the Companies Act, 2013.

Committee meetings

The Company has total four Committees namely Audit Committee, Corporate Social Responsibility Committee, Stakeholders Relationship Committee and Nomination and Remuneration Committee. Each Committee met five times during the year under review.

The Committee meetings were convened and held on May 26, 2014, August 04, 2014, November 10, 2014, January 22, 2015 and March 23, 2015. The details of which are given in the Corporate Governance Report. The gap between two Meetings did not exceed four months.

AUDIT Committee

The Audit Committee consists of one executive & three non- executive members, Chairman being Independent Director.

The composition of the Audit Committee as on March 31, 2015 :

Name Designation

Shri Anant Sagar Awasthi* Chairman

Shri Dilip Patel# Member

Shri Satish Chandra Gupta Member

Shri Manish Nuwal Member

Smt Madhu Vij" Member

Smt Khushboo Pasari Secretary

* Shri Anant Sagar Awasthi ceased to be a chairman of the Audit Committee w.e.f. May 25, 2015

# Shri Dilip Patel is appointed as Chairman in place of Shri Anant Sagar Awasthi w.e.f. May 25, 2015

" Smt Madhu Vjj is appointed as a member of the Audit Committee w. e. f. May 25, 2015

VIGIL MECHANISM

The Vigil Mechanism of the Company which also incorporates a Whistle Blower Policy to deal with instance of fraud and mismanagement, if any. The details of the Whistle Blower Policy is explained in the Corporate Governance Report and also posted on the website of the Company http://solargroup.com/uploads/investors/policies/WBP.pdf

NOMINATION AND REMUNERATION COMMITTEE

The Nomination and Remuneration Committee consists of three non-executive members, Chairman being Independent Director.

The compostion of the Nomination and Remuneration as on March 31, 2015

Name Designation

Shri Anant Sagar Awasthi Chairman

Shri Satish Chandra Gupta Member

Shri Dilip Patel Member

Smt Khushboo Pasari Secretary

STAKEHOLDERS RELATIONSHIP COMMITTEE

The Stakeholders Relationship Committee consists of two executive and one non-executive members, Chairman being Independent Director.

The compostion of stackholders Relationship Committee as on March 31, 2015

Name Designation

Shri Anant Sagar Awasthi Chairman

Shri Kailashchandra Nuwal Member

Shri Kundan Singh Talesra* Member

Smt Khushboo Pasari Secretary

*Shri Roomie Dara Vakil is appointed in place of Shri Kundan Singh Talesra with effect from May 25, 2015.

CORPORATE SOCIAL RESPONSIBILITY INITIATIVES

The Corporate Social Responsibility Committee consists of one Non-Executive Independent Director & two Executive Directors, Chairman being Executive Director.

The compostion of Corporate Social Responsibility committee as on March 31, 2015

Name Designation

Shri Satyanarayan Nuwal Chairman

Shri Manish Nuwal Member

Shri Ajai Nigam Member

Smt Khushboo Pasari Secretary

As part of its initiatives under Corporate Social Responsibility (CSR), the Company has undertaken projects in the areas of Disease Prevention and Care Projects and made its CSR contribution towards public through recognised hospitals by providing facility like Installation of Medical Equipments.

This project is largely in accordance with Schedule VII of the Companies Act, 2013.

Solar's investment in Disease Prevention initiatives is in accordance with the objective of providing better healthcare to the needy persons of the society. The CSR initiatives undertaken in this thrust area include supply of medical equipments, to various hospitals.

The Report on CSR activities is annexed herewith as "Annexure D".

PARTICULARS OF LOAN, GUARANTEES OR INVESTMENTS WITH RELATED PARTIES

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

RELATED PARTY TRANSACTIONS

All related party transactions that were entered into during the financial year 2014 - 15 were on an arm's length basis and were in the ordinary course of business. There are no materially significant related party transactions made by the Company with Promoters, Directors, Key Managerial Personnel or other designated persons which may have a potential conflict with the interest of the Company at large.

All Related Party Transactions are placed before the Audit Committee and also the Board for approval. Prior omnibus approval of the Audit Committee is obtained on a quarterly basis for the transactions which are of a foreseen and repetitive nature. The transactions entered into pursuant to the omnibus approval so granted are audited and a statement giving details of all related party transactions is placed before the Audit Committee and the Board of Directors for their approval on a quarterly basis. The Company has formulated a Related Party Transactions policy indicating the Standard Operating Procedures for purpose of identification and monitoring of such transactions.

The policy on Related Party Transactions as approved by the Board is uploaded on the Company's website. None of the Directors has any pecuniary relationships or transactions vis-a-vis the Company.

The Company has entered into contracts with related parties as per Section 188 of the Companies Act, 2013. The details forming part of the extract of the contracts in form AOC-2 is annexed herewith as "Annexure E".

SIGNIFICANT AND Material ORDERS PASSED BY THE REGULATORS OR COURTS

During the year under review, there are no significant material orders passed by the Regulators / Courts which would impact the going concern status of the Company and its future operations.

PARTICULARS OF EMPLOYEES

The information required under Section 197 of the Act read with rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 are given below:

a. The ratio of the remuneration of each director to the median remuneration of the employees of the Company for the financial year:

Name of the Directors Title Ratio to median remuneration

Shri Satyanarayan Chairman and 211.76 Nuwal Executive Director

Shri Kailashchandra Executive Director 211.76 Nuwal

Shri Manish Nuwal Executive Director 211.76

Shri Kundan Singh Executive Director 32.67

Talesra

Shri Roomie Dara Vakil Executive Director 24.20

Note: Non-Executive Independent Directors were paid sitting fees for attending Board and Board Committee Meetings for the year 2014 - 15.

b. The percentage increase in remuneration of each director, Chief Executive Officer, Chief Financial Officer, Company Secretary in the financial year:

Name of the Directors Title % Increase in & KMPs other than remuneration Directors in the financial year 2014 - 15

Shri Satyanarayan Chairman and NIL Nuwal Executive Director

Shri Kailashchandra Executive Director NIL Nuwal

Shri Manish Nuwal Executive Director NIL

Shri Kundan Singh Executive Director 54.29% Talesra

Shri Roomie Dara Vakil Executive Director 5.26%

Shri Nilesh Panpaliya Chief Financial 4.81%

Officer

Smt Khushboo Pasari Company Secretary 7.50%

c. The percentage increase in the median remuneration of employees in the financial year: 10.29 %

d. The number of permanent employees on the rolls of Company: 1104

e. The explanation on the relationship between average increase in remuneration and Company performance:

On an average, employees received an annual increase of 8.31%. The individual increments varied from 4 % to 23 %, based on individual performance.

The increase in remuneration is in line with the market trends in the respective countries. In order to ensure that remuneration reflects Company performance, the performance pay is also linked to organization performance, apart from an individual's performance.

f. Comparison of the remuneration of the key managerial personnel against the performance of the Company:

Aggregate remuneration of key managerial 33.36 personnel (KMP) in FY 2014 - 15 (Rs. Lakhs)

Revenue (Rs. Lakhs) 101475.18

Remuneration of KMPs (as % of revenue) 0.03 %

Profit before Tax (PBT) (Rs. Lakhs) 14034.85

Remuneration of KMP (as % of PBT) 0.24 %

g. Variations in the market capitalisation of the Company, price earnings ratio as at the closing date of the current financial year and previous financial year:

particulars March 31, March 31, % Change 2015 2014

Market Capitalisation 6138.94 1594.43 285.02 (Rs. crores)

Price Earnings Ratio 41.65 13.46 209.44

h. Percentage increase over decrease in the market quotations of the shares of the Company in comparison to the rate at which the Company came out with the last public offer:

Particulars March 31, March 27, % Change 2015 2006(IPO)

Market Price (BSE) 3392.05 190 1685.29

Market Price (NSE) 3402.55 190 1690.82

i. Average percentile increase already made in the salaries of employees other than the managerial personnel in the last financial year and its comparison with the percentile increase in the managerial remuneration and justification thereof and point out if there are any exceptional circumstances for increase in the managerial remuneration:

The average annual increase was around 10.81 %. However, during the course of the year, the total increase is approximately 10.81 %, after accounting for promotions and other event based compensation revisions. Increase in the managerial remuneration for the year was 2.02 %. Comparison of each remuneration of the key managerial personnel against the performance of the Company:

Parti Shri Shri Shri Shri cula Satyanara Manish Kailashc Kundan rs yan Nuwal Nuwal, handra Singh Chairman Executive Nuwal Talesra, and Director Executive Executive Executive Director Director Director and Chief Executive Officer*



Remu 212.88 212.88 212.88 35.44 nera tion

in FY 2014 -15 (Rs. Lacs)

Reve 101475.18 101475.18 101475.18 101475.18 nue (Rs. Lacs)

Remu 0.21 % 0.21 % 0.21 % 0.035 % nera tion as % of re venue

Prof 14034.85 14034.85 14034.85 14034.85 it be fore Tax (PBT) (Rs. Lacs)

Remu 1.52 % 1.52 % 1.52 % 0.25 % nera tion (as% of PBT)

Parti Shri Shri Mrs cula Roomie Nilesh khus rs Dara Panpaliya, hboo Vakil, Chief Pasa Executive Financial ri, Officer comp pany secr eta ry



Remu 25.57 26.42 6.94 nera tion

in FY 2014 -15 (Rs. Lacs)

Reve 101475.18 101475.18 10147 nue 5.18 (Rs. Lacs)

Remu 0.025 % 0.026 % 0.007% nera tion as % of re venue

Prof 14034.85 14034.85 14034.85 it be fore Tax (PBT) (Rs. Lacs)

Remu 0.18 % 0.19% 0.05 % nera tion (as% of PBT)

* Shri Kundan Singh Talesra ceased to be Executive Director and Chief Executive Officer w.e.f May 25, 2015. Shri Anil Kumar Jain is appointed as an Executive Director in his place and Shri Manish Nuwal will act as a Chief Executive Officer of the Company.

k. The key parameters for any variable component of remuneration availed by the directors:

The key parameters for the variable component of remuneration availed by the directors are considered by the Board of Directors based on the recommendations of the Nomination and Remuneration Committee as per the Remuneration Policy of the Company.

l. The ratio of the remuneration of the highest paid director to that of the employees who are not directors but receive remuneration in excess of the highest paid director during the year: None.

m. Affirmation that the remuneration is as per the remuneration policy of the Company:

The Company affirms remuneration is as per the remuneration policy of the Company.

n. The statement containing particulars of employees as required under Section 197(12) of the Act read with Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, is provided in a separate annexure. Further, the report and the accounts are being sent to the members excluding the aforesaid annexure. In terms of Section 136 of the Act, the said annexure is open for inspection at the Registered Office of the Company. Any shareholder interested in obtaining a copy of the same may write to the Company Secretary.

STATEMENT OF MANAGEMENT'S RESPONSIBILITY FOR CONSOLIDATED FINANCIAL STATEMENTS:

Management is responsible for the preparation of the Consolidated Financial Statements and related information that are presented in this report. The Board of Directors of your Company at its meeting held on May 25, 2015 has approved the Audited Consolidated Financial Statements for the financial year 2014 - 15 and its subsidiaries in accordance with Clause 32 of Listing Agreement with the Stock Exchanges and Accounting Standard (AS-21) and other Accounting Standards issued by the Institute of Chartered Accountants of India. The Consolidated Financial Statements of your Company for the financial year 2014-15, are prepared in compliance with applicable Accounting Standards based on management's estimates, assumptions and judgments where applicable as well as Listing Agreement as prescribed by the Securities and Exchange Board of India.

The Company has built adequate systems of internal controls aimed at achieving efficiency in operations, optimum utilization of resources, effective monitoring and compliance with all applicable laws.

The Internal Audit function monitors the effectiveness of controls, and also provides an independent and objective assessment of the overall governance processes in the Company, including the application of a systematic risk management framework. The Audit Committee of the Board reviews major internal audit reports as well as the adequacy of internal controls.

SOLAR'S CORPORATE GOVERNANCE PHILOSOPHY:

Corporate Governance philosophy of the Company is based on the principles of equity, fairness, transparency, spirit of law and honest communication. The Company believes that sound Corporate Governance is necessary to retain stakeholder's trust and ensures efficient working and proper conduct of the business of the Company with integrity. Development of Corporate Governance guidelines is a continuous process which evolves over a period of time and undergoes changes to suit the changing times and needs of the business, society and the nation.

Your Company has implemented the conditions of Corporate Governance as contained in Clause 49 of the Listing Agreement with the Stock Exchanges. A separate report on Corporate Governance and Management Discussion and Analysis along with necessary certificates is given elsewhere in this report. Also certificate taken from M/s Gandhi Rathi & Co. Chartered Accountants, Nagpur, Statutory Auditors of the Company, confirming compliance of the conditions of Corporate Governance as stipulated under clause 49 of the Listing Agreement, is annexed to this report.

TRANSFER OF Amounts TO INVESTOR EDUCATION AND PROTECTION FUND

Pursuant to Sections 123 and 125 of Companies Act, 2013; the relevant amounts which have remained unclaimed and unpaid for a period of seven years from the date they became due for payment have been transferred to the Investor Education and Protection Fund (IEPF) administered by the Central Government.

During the year under review, in Compliance with the above Sections and Investor Education and Protection Fund (awareness and protection of investors) Rules, 2011. your company has transferred Unpaid and unclaimed dividend amount lying in the Final Dividend Account (2006-2007) of Rs. 49,953 and Interim Dividend Account of (2007-2008) Rs. 27,228 to IEPF.

Pursuant to the provisions of Investor Education and Protection Fund (Uploading of information regarding unpaid and unclaimed amounts lying with companies) Rules, 2012, the Company has uploaded the details of unpaid and unclaimed amounts lying with the Company as on September 4, 2014 (date of last Annual General Meeting) on the Company's website (www.solargroup.com) and also on the Ministry of Corporate Affairs' website.

POST BALANCE SHEET DATE EVENT:

Board of Directors of your Company has announced the following in their meeting held on May 25, 2015 at the registered office of the Company;

a. The acquisition of 4,98,766 Equity Shares aggregating to 100% stake of M/s Blastec (India) Private Limited and

b. The acquisition of 49,77,700 Equity Shares aggregating to 100% stake of M/s Emul Tek Private Limited.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

A detailed review of operations, performance and future outlook of your Company and its businesses is given in the Management Discussion and Analysis, which forms part of this Report as stipulated under Clause 49 of the Listing Agreement with the Stock Exchange(s) in India.

CEO/CFO CERTIFICATION:

As required under Clause 49 (IX) of the Listing Agreement, the CEO/CFO certification is attached with the annual report.

DIRECTOR'S RESPONSIBILITY STATEMENT:

Pursuant to Section 134 (3) (c) of the Companies Act, 2013 the Board of Directors hereby confirms that:

i. In the preparation of the annual accounts of the Company for the year ended March 31, 2015, the applicable Accounting Standards had been followed and there are no departures;

ii. Accounting policies have been selected and applied consistently and judgments and estimates made that are reasonable and prudent so as to give true and fair view of the state of affairs of the Company at the end of the financial year March 31, 2015 and of the profit of the Company for that year ended on that date;

iii. Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of this act for safeguarding the assets of the Company and detecting fraud and other irregularities;

iv. Annual accounts for the year ended March 31, 2015 have been prepared on a going concern basis.

v. Internal Financial controls were in place and that the financial controls were adequate and were operating effectively.

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

DISCLOSURE Requirements

As per Clause 49 of the listing agreements entered into with the stock exchanges, corporate governance report with auditors' certificate thereon and management discussion and analysis are attached, which form part of this report.

Details of the familiarisation programme of the independent directors are available on the website of the Company at the following link http://solargroup.com/uploads/investors/policies/FPIDS.pdf

Policy for determining material subsidiaries of the Company is available on the website of the Company at the following link http://solargroup.com/uploads/investors/policies/PDMS.pdf

Policy on dealing with related party transactions is available on the website of the Company at the following link http://solargroup.com/uploads/investors/policies/PRPT.pdf

The Company has formulated the Corporate Social Responsibility Policy in line with the provisions of Section 135(4) of the Companies Act, 2013 and Rule 9 of Companies (Corporate Social Responsibility Policy) Rules, 2014 and the said policy is available on the website of the Company at the following link http://solargroup.com/uploads/investors/policies/CSR.pdf

The Company has formulated and published a Whistle Blower Policy to provide Vigil Mechanism for employees including directors of the Company to report genuine concerns. The provisions of this policy are in line with the provisions of the Section 177(9) of the Act and the revised Clause 49 of the Listing Agreements with stock exchanges and the said policy is available at the website of the Company at the following link http://solargroup.com/uploads/investors/policies/WBP.pdf

APPRECIATION & ACKNOWLEDGEMENT

Your company satisfactorily outperformed the industry in this challenging year and continues to maintain its leadership position. It has been surpassing all the international quality and cost benchmarks and continues to build shareholder value. Your Director looks to the future with confidence.

Your Directors place on record their appreciation for the overwhelming co-operation and assistance received from the investors, customers, business associates, bankers, vendors, as well as regulatory and governmental authorities. Your Directors also thanks the employees at all levels, who through their dedication, co-operation, support and smart work have enabled the company to achieve a moderate growth and is determined to poise a rapid and remarkable growth in the year to come.

For and on behalf of the Board

Place : Nagpur (Satyanarayan Nuwal) Date : May 25, 2015 Chairman


Mar 31, 2014

Dear Shareholders,

The Directors have great pleasure in presenting the 19th Annual Report on the business and operations of the COMPANY together with the Audited Balance Sheet and Profit & Loss Accounts for the year ended on 31st March, 2014. Since this Report pertains to the FINANCIAL Year that commenced prior to 1st April, 2014 the contents there in are governed by the relevant provisions/schedules/rules of the Companies Act,1956, in COMPLIANCE with General Circular No. 08/2014 dated 4th April, 2014 issued by Ministry of Corporate Affairs.

FINANCIAL HIGHlIGHTS (Rs. in Lakhs)

STANDALONE CONSOLIDATED

PARTICULARS 2014 2013* 2014 2013*

Net Revenue from Operations 92112.55 90463.24 114411.61 113601.93

Less: Expenditure 78141.35 78807.07 92998.08 93852.17

Operating Profit (PBIDT) 13971.20 11656.17 21413.53 19749.76

Interest 1448.24 1095.76 1785.64 1834.97

Profit before Depreciation & tax (PBT) 12522.96 10560.41 19627.89 17914.79

Less: Depreciation 1257.36 1031.23 2186.93 1697.47

Profit before Tax & Exceptional item 11265.60 9529.18 17440.96 16217.32

Less: Exceptional Item 1000.14 1000.14 1000.14 1001.86

Profit before Tax 10265.46 8529.04 16440.82 15215.46

Less: Provision for taxation 1881.04 947.49 3490.38 2572.25

Profit after Tax 8384.42 7581.55 12950.44 12643.21

Share of profit transfer to minority - - 1106.29 1013.98

Stock Reserve - - 28.50 417.81

Balance brought forward 12251.45 8855.85 21251.62 15684.18

Balance available for appropriation 20635.87 16437.40 33124.27 27731.22

Appropriation:

Interim Dividend 904.90 904.90 886.68 904.90

Proposed Dividend 1266.86 1085.88 1266.86 1085.88

Tax On Dividend 217.24 195.17 284.54 331.45

Adjustment of taxes - - - 157.37

General Reserve 2500.00 2000.00 4500.00 4000.00

Balance Profit Carried to Balance Sheet 15746.87 12251.45 26186.19 21251.62

Earning per Share (EPS) 46.33 42.68 65.44 65.47

- Previous year figures have been regrouped & rearranged wherever necessary.

RESULTS OF OPERATION

Standalone Reaching

- During the FINANCIAL year ending on 31st March, 2014 the COMPANY achieved turnover of Rs. 98551.23 Lakhs as against turnover of Rs. 96959.33 Lakhs achieved during the previous year, which is a moderate increase in turnover by 1.64 %.

- the Profit After tax (PAt) for the FINANCIAL year 2013-14 isRs. 8384.42 Lakhs againstRs. 7581.55 Lakhs in the previous year 2012-13.

- Profit before interest, Depreciation, Amortisation, exceptional items & tax stood at Rs. 13971.20 as against Rs. 11656.17 Lakhs in the previous year.

- earnings Per Share as on 31st March, 2014 is Rs. 46.33 againstRs. 42.68 as on 31st March, 2013.

- the net worth of the COMPANY has increased and stands at Rs. 45559.38 Lakhs for the fiscal year 2013-14 from Rs. 39563.96 Lakhs of the previous fiscal year 2012-13.

consolidated Reaching

- During the FINANCIAL year ending on 31st March, 2014 the COMPANY achieved turnover of Rs. 122377.53 Lakhs as against turnover of Rs. 121520.17 Lakhs achieved during the previous year, which is a moderate increase in turnover by 0.71%.

- the Profit After tax (PAt) after transferring the share of profit of Minority interest for the FINANCIAL year 2013-14 is Rs. 11844.15 Lakhs against previous year Rs. 11629.23 Lakhs in 2012-13.

- Profit before interest, Depreciation, Amortisation, exceptional items & tax stood at Rs. 21413.53 Lakhs as against Rs. 19749.76 Lakhs in the previous year.

- earnings Per Share as on 31st March, 2014 is Rs. 65.44 vis a vis against Rs. 65.47 as on 31st March, 2013.

- the Net Worth of the COMPANY has increased and stands atRs. 66157.41 Lakhs in the fiscal year 2014 from Rs. 57270.40 Lakhs of the previous fiscal year.

LEVERAGING TECHNOLOGY OF SOVEREIGN DEFENcE

As per Stockholm international Peace Research institute (SiPRi) report, india is the world''s largest arms importer. its arms import is estimated to be more than three times of what its neighboring countries are importing. Over the last five years, india''s share in total global arms import has doubled from 7% to 14%. even the Government of india had announced its focused topmost attention on security of the country and had allocated a composite sum of iNR 224 thousand Crores towards the Defence Sector. the indian Government had further given signs and intention to liberate and reduce the dependency upon imports by developing and manufacturing indigenously.

taking cognizance of this huge opportunity, your COMPANY has already started exploring the growth opportunity in Defence Sector. the COMPANY had already been granted the licence to manufacture HMX specifically used as major explosive components used in manufacturing of warheads. A state-of- the-art plant to manufacture HMX and Composite Propellants has already been completed.

AUDIT COMMITTEE:

the Audit Committee consists of one executive & three non-executive members, Chairman being independent Director.

Name Designation

Shri Anant Sagar Awasthi Chairman

Shri Satish Chandra Gupta Member

Shri Dilip Patel Member

Shri Manish Nuwal Member

Smt Khushboo Pasari Secretary

AppROpRIATIONS:

Dividend:

Summary of Final Dividend declared by the COMPANY in the year 2013 and recommended for the 2014 are given below:

Your Directors recommend a final Dividend of 70% (Rs. 7/- per equity share of Rs. 10/- each) to be appropriated from the profits of the year 2013-14, subject to the approval of the shareholders at the ensuing Annual General Meeting. the Dividend will be paid in COMPLIANCE with applicable regulations.

Pursuant to the approval of Board of Directors on October 28, 2013, your COMPANY had distributed an interim dividend of Rs. 5/- per share, of face value of Rs. 10/- each.

The total dividend for the year ended on March 31, 2014 would accordingly be Rs. 12 per equity share (120% of face value) as against the total dividend of Rs. 11 per equity share (110% of face value) for the year ended on March 31, 2013. the total outgo due to Dividend of the COMPANY was Rs. 2438.08 Lakhs, including dividend distribution tax as against Rs. 2322.23 Lakhs in the previous year. the Dividend payout Ratio of your COMPANY is 20.58%.

TRANSFERS TO RESERVES:

the COMPANY proposes has transferred Rs. 4500.00 Lakhs to the general reserve out of the amount available for appropriations and an amount of Rs. 26186.19 Lakhs is proposed to be retained in the statement of profit and loss.

CREDIT RATINGS:

CRiSiL has re-affirmed its ratings of AA-/Positive for Long term Borrowings to the of Solar industries india Ltd (SiiL). the ratings reflect SiiL''S strong market position, good operating efficiencies (backed by prudent raw material procurement policies and backward integration), and strong debt protection measures. to arrive at its ratings, CRiSiL has combined SiiL''S FINANCIAL and business profiles with those of its SUBSIDIARIES.

In addition to long term rating, CRiSiL has also assigned A1 (Reaffirmed) rating to SiiL for Short term Borrowings.

DIRECTORS:

Director''s Retiring by Rotation

In terms of Articles of Association of the COMPANY and as per Section 152(6) of the Companies Act, 2013 provides that 2/3rd of the Board of Directors is considered to be Directors liable to retire by rotation, of which 1/3rd shall retire at every Annual General Meeting of the COMPANY as per Section 152(6) (e) of the Companies Act, 2013 and the COMPANY shall have an option to re-appoint the retiring Director or appoint someone else in his place. As per the new regime, independent Directors does not have to retire by rotation.

(Rs.in Lakhs)

Final Dividend for the Year Rate of Dividend Amount of Dividend

2013 60 % 1085.88

2014 (if approved by members) 70% 1266.86



Final Dividend for the Year Dividend Total Distribution tax Outflow

2013 184.54 1270.42

2014 (if approved by members) 215.30 1484.10

In pursuance to the new regime, this year only Shri Kailashchandra Nuwal who, retires by rotation and being eligible offer himself for re-appointment at this Annual General Meeting.

The Boards of Directors recommends his re-appointment for consideration of the Shareholders.

The brief resumes and other details relating to who is proposed to be re-appointed, as required to be disclosed under Clause 49 of the Listing Agreement, forms integral part of this Report.

DIRECTOR''S APPOINTMENT

Non-Executive Independent Directors

Pursuant to provisions of Sections 149(4) of Companies Act, 2013 every listed COMPANY is required to appoint at least one third of its Directors as independent Directors. the Board already has half of its Directors in the category of Non-executive independent Directors in terms of Clause 49 of the Listing Agreement. the Board therefore in its meeting held on 26th May, 2014 appointed the existing independent Directors under clause 49 as independent Directors pursuant to Companies Act,2013 subject to approval of shareholders.

In accordance with the provisions of Sections 149, 152 read with Schedule iV and all other applicable provisions of the Companies Act, 2013 and the Companies (Appointment and Qualification of Directors) Rules, 2014 (including any statutory modification(s) or re-enactment thereof for the time being in force) and Clause 49 of the Listing Agreement appointment of all the independent Directors namely Shri Anant Sagar Awasthi, Shri Dilip Patel, Shri Satish Chandra Gupta, Shri Ajai Nigam and Shri Amrendra Verma is now put up for approval of members at the ensuing Annual General meeting.

Necessary details in terms of section 102(1) of the Companies Act, 2013 forms integral part of this Report.

The independent directors have submitted the declaration of independence, as required pursuant to section 149(7) of the Companies Act, 2013 stating that they meet the criteria of independence as provided in sub-section(6).

With the appointment of independent directors, the conditions specified in the Act and the Rules made thereunder as also under new clause 49 of the listing agreement stand complied.

Executive Directors

In accordance with the provisions of Sections 2(94), 196, 197, 198 and 203 read with Schedule V and all other applicable provisions of the Companies Act, 2013 and the Companies (Appointment and Qualification of Directors) Rules, 2014 (including any statutory modification(s) or re-enactment thereof for the time being in force) and Clause 49 of the Listing Agreement Shri Kundan Singh talesra have been appointed as executive Director of the COMPANY to hold office for a period of 5 (Five) consecutive years and Shri Roomie Dara Vakil have been appointed as executive Director of the COMPANY to hold office for 3 (three) consecutive years from the date of their respective appointment. Shri Kundan Singh talesra will not be liable to retire by rotation while Shri Roomie Dara Vakil will be liable to retire by rotation.

The COMPANY has received requisite notice in writing from members proposing the candidature of Shri Kundansingh talesra and Shri Roomie Dara Vakil for re-appointment as executives Directors.

CORPORATE SOCIAL RESPONSIBILITY COMMITTEE

The Companies Act, 2013 notified section 135 of the Act concerning Corporate Social Responsibility alongwith the Rules thereunder and revised Schedule Vii to the Act on 27th February, 2014 and other amendments to Schedule Vii to come into effect from 1st April, 2014.

The COMPANY being covered under the provisions of the said section, has taken necessary initial steps in this regard. A Committee of the directors, titled ''CORPORATE SOCIAL RESPONSIBILITY COMMITTEE'', has been formed by the Board in its meeting held on 26th May, 2014, consisting of the following:

Name Designation

Shri Satyanarayan Nuwal Chairman

Shri Manish Nuwal Member

Shri Ajai Nigam Member

Mrs. Khushboo Pasari Secretary

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.

AUDITORS AND THEIR OBSERVATIONS

Pursuant to the provisions of section 139 of the Companies Act, 2013 and the Rules made there under, the current auditors of the COMPANY, M/s Gandhi Rathi& Co. Chartered Accountants are eligible to hold the office for a period of three years until the conclusion of the 22nd Annual General Meeting.

M/s Gandhi Rathi & Co. Chartered Accountants, Statutory Auditors of the COMPANY, hold office until the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment. the COMPANY has received letters from the Auditors to the effect that their re-appointment, if made, would be within the prescribed limits under Section 141(3)(g) of the Companies Act, 2013 and that they are not disqualified for reappointment

The Notes on FINANCIAL Statements referred to in the Auditors'' Report are self-explanatory and do not call for any further comments.

COST AUDITORS

the COMPANY has appointed Mr. Deepak Khanuja, Partner of Khanuja Patra & ASSOCIATES, Nagpur to act as COST auditor for conducting the audit of COST records of the COMPANY for the FINANCIAL year 2013-14.

SECRETERIAL AUDITOR

the Board of Directors of the COMPANY appointed Shri Anant B. Khamankar, Practising COMPANY Secretary, to conduct the Secretarial Audit as per Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules,2014 prescribed under Section 204 of the Companies Act, 2013 for the FINANCIAL year 2014-2015.

PARTICULARS OF EMPLOYEES:

the Ministry of Corporate Affairs has vide notification dated 31st March, 2011 enhanced the limits for the purpose of disclosure of particulars of employees in the Directors Report as requisite under section 217 (2A) of the Companies Act, 1956 read with Companies (Particulars of employees) Amendment Rules, 2011.

the COMPANY is having employees whose information in accordance with the provisions of Section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of employees) Rules, 1975, amended as Companies (Particulars of employees) Amendment Rules, 2011 are to be given.

However, pursuant to the provisions of Section 219(1)(b) (iv) of the Companies Act, 1956, the Report and Accounts are being sent to the Members excluding the statement of particulars of employees. Any Member may obtain a copy of the said statement by writing to the COMPANY Secretary at the registered office of the COMPANY.

SUBSIDIARY OPERATIONS:

During the year under review Solar industries india Limited has increased its holding from 51% to 100% in Solar Mines and Minerals Limited.

As a purposeful strategy, your COMPANY carries all its business operations through several subsidiary and associate companies which are formed either directly or as step-down SUBSIDIARIES or in certain cases by acquisition of a majority stake in existing enterprises.

SUBSIDIARIES FINANCIAL STATEMENT

the Ministry of Corporate Affairs (MCA) by General Circular No. 2/2011 dated February 8, 2011, had granted an exemption to companies from complying with Section 212 of the Companies Act, 1956, provided such companies fulfill conditions mentioned in the said circular. Accordingly, the Board of Directors of your COMPANY at its meeting held on May 26, 2014, approved the Audited Consolidated FINANCIAL Statements for the FINANCIAL year 2013-14 which includes FINANCIAL information of all its SUBSIDIARIES, and forms part of this report.

the Consolidated FINANCIAL Statements of your COMPANY for the FINANCIAL year 2013-14, have been prepared in COMPLIANCE with applicable Accounting Standards and Listing Agreement requirement as prescribed by the Securities and exchange Board of india.

the annual accounts and FINANCIAL statements of the subsidiary companies of your COMPANY and related detailed information shall be made available to members on request and are open for inspection at the Registered Office of your COMPANY. Your COMPANY has complied with all the conditions as stated in the circular and accordingly has not attached the FINANCIAL statements of its subsidiary Companies for the FINANCIAL year 2013-14. A statement of summarized FINANCIALs of all SUBSIDIARIES of your COMPANY including capital, reserves, total assets, total LIABILITIES, details of investment, turnover, etc., pursuant to the General Circular issued by the Ministry of Corporate Affairs, forms part of this report.

STATEMENT OF MANAGEMENT''S RESpONSIBILITY FOR CONSOLIDATED FINANCIAL STATEMENTS:

Management is responsible for the preparation of the Consolidated FINANCIAL Statements and related information that are presented in this report. the Board of Directors of your COMPANY at its meeting held on May 26, 2014, approved the Audited Consolidated FINANCIAL Statements for the FINANCIAL year 2013-14 and its SUBSIDIARIES in accordance with Clause 32 of Listing Agreement with the Stock exchanges and Accounting Standard (AS–21) and other Accounting Standards issued by the institute of Chartered Accountants of india. the Consolidated FINANCIAL Statements of your COMPANY for the FINANCIAL year 2013-14, are prepared in COMPLIANCE with applicable Accounting Standards based on management''s estimates, assumptions and judgments where applicable as well as Listing Agreement as prescribed by the Securities and exchange Board of india.

the COMPANY has built adequate systems of internal controls aimed at achieving efficiency in operations, optimum utilization of resources, effective monitoring and COMPLIANCE with all applicable laws.

the internal Audit function monitors the effectiveness of controls, and also provides an independent and objective assessment of the overall governance processes in the COMPANY, including the application of a systematic risk management framework. the Audit Committee of the Board reviews major internal audit reports as well as the adequacy of internal controls.

SOLAR''S CORPORATE GOVERNANCE PHILOSOPHY:

Corporate Governance philosophy of the COMPANY is based on the principles of equity, fairness, transparency, spirit of law and honest communication. the COMPANY believes that sound Corporate Governance is necessary to retain stakeholder''s trust and ensures efficient working and proper conduct of the business of the COMPANY with integrity. Development of Corporate Governance guidelines is a continuous process which evolves over a period of time and undergoes changes to suit the changing times and needs of the business, society and the nation.

Your COMPANY has implemented the conditions of Corporate Governance as contained in Clause 49 of the Listing Agreement with the Stock exchanges. A separate report on Corporate Governance and Management Discussion and Analysis along with necessary certificates is given elsewhere in this report. Also certificate taken from M/s Gandhi Rathi & Co. Chartered Accountants, Nagpur, Statutory Auditors of the COMPANY, confirming COMPLIANCE of the conditions of Corporate Governance as stipulated under clause 49 of the Listing Agreement, is annexed to this report.

TRANSFER OF AMOUNTS TO INVESTOR EDUCATION AND PROTECTION FUND

Pursuant to Sections 205A(5) and 205C of Companies Act, 1956); the relevant amounts which have remained unclaimed and unpaid for a period of seven years from the date they became due for payment have been transferred to the investor education and Protection Fund (iePF) administered by the Central Government .

Pursuant to the provisions of investor education and Protection Fund (Uploading of information regarding unpaid and unclaimed amounts lying with companies) Rules, 2012, the COMPANY has uploaded the details of unpaid and unclaimed amounts lying with the COMPANY as on September 11, 2013 (date of last Annual General Meeting) on the COMPANY''s website (www.solargroup. com) and also on the Ministry of Corporate Affairs website.

MANAGEMENT DIScUSSION AND ANALYSIS REPORT:

A detailed review of operations, performance and future outlook of your COMPANY and its businesses is given in the Management Discussion and Analysis, which forms part of this Report as stipulated under Clause 49 of the Listing Agreement with the Stock exchange(s) in india.

CEO/CFO CERTIFIcATION:

As required under Clause 49(V) of the Listing Agreement, the CeO/ CFO certification is attached with the annual report.

COMPLIANCE

Your COMPANY had framed the policies and developed the work culture wherein the work of the COMPANY is performed in such a way that the internal check mechanism ensures that the work of the COMPANY is done correctly and timely. the COMPANY''s internal auditor also periodically conducts the internal audit and make ensure that all the COMPLIANCE are being done and reports to the management of the COMPANY, in case of any variance. Your COMPANY also arranges and organises for the internal and external training facilities and update the knowledge of the personnel in line with all amendments / new regime that are being made applicable to your COMPANY. Lastly, your COMPANY is also reviewing the scope by improving on the system of MiS Reports, which further adds to the assurance of timely COMPLIANCE of all the laws applicable to the COMPANY."

DIRECTOR''S RESPONSIBILITY STATEMENT:

pursuant to section 217 (2AA) of the companies Act, 1956 the Board of Directors hereby confirms that:

i. in the preparation of the annual accounts of the COMPANY for the year ended March 31, 2014, the applicable Accounting Standards had been followed and there are no departures.

ii. Accounting policies have been selected and applied consistently and judgments and estimates made that are reasonable and prudent so as to give true and fair view of the state of affairs of the COMPANY at the end of the FINANCIAL year and of the profit of the COMPANY for that period.

iii. Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of this act for safeguarding the assets of the COMPANY and detecting fraud and other irregularities.

iv. Annual accounts for the year ended March 31, 2014 have been prepared on a going concern basis.

APPRECIATION & ACKNOWLEDGEMENT

Your COMPANY satisfactorily outperformed the industry in this challenging year and continues to maintain its leadership position. it has been surpassing all the international quality and COST benchmarks and continues to build shareholder value. Your Director looks to the future with confidence.

Your Directors place on record their appreciation for the overwhelming co-operation and assistance received from the investors, customers, business ASSOCIATES, bankers, vendors, as well as regulatory and governmental authorities. Your Directors also thanks the employees at all levels, who through their dedication, co-operation, support and smart work have enabled the COMPANY to achieve a moderate growth and is determined to poise a rapid and remarkable growth in the year to come.

For and on behalf of the Board

Place : Nagpur (Satyanarayan Nuwal)

Date : May 26, 2014 Chairman


Mar 31, 2013

Dear Shareholders,

The Directors have great pleasure in presenting the Annual Report together with audited statements of accounts for the year ended on 31st March, 2013.

Financial Highlights

(Rs. in lacs)

Particulars Standalone Consolidated

2013 2012 2013 2012

Net Revenue from operations 90463.24 74871.45 114183.01 99121.95

Less: Expenditure 77710.59 63824.83 93181.87 79653.85

Operating profit (PBIDT) 12752.65 11046.62 21001.14 19468.10

Interest 2190.52 2008.81 3086.35 2357.58

Profit before Depreciation & Tax (PBT) 10562.13 9037.81 17914.79 17110.52

Less: Depreciation 1031.23 804.77 1697.47 1278.14

Profit before Tax & Exceptional item 9530.90 8233.04 16217.32 15832.38

Less: Exceptional item 1001.86 315.03 1001.86 436.58

Profit before Tax 8529.04 7918.01 15215.46 15395.8

Less: Provision for Taxation 947.49 1829.39 2572.25 4254.50

Profit after Tax 7581.55 6088.62 12643.21 11141.30

Share of profit transfer to minority - - 1013.98 1020.94

Stock Reserve - - 417.81 175.94

Balance brought forward 8855.88 6644.41 15684.18 11401.30

Balance available for appropriation 16437.43 12733.03 27731.22 21697.60

Appropriation:

Interim Dividend 904.90 866.19 904.90 866.19

Proposed Dividend 1085.88 866.19 1085.88 866.19

Tax On Dividend 195.18 144.77 331.45 281.04

Adjustment of Taxes - - 157.37 -

General Reserve 2000 2000 4000 4000

Balance Profit carried to Balance Sheet 12251.47 8855.88 21251.62 15684.18

Earning Per Share (EPS) 42.68 35.15 65.47 58.42

Results of Operation

Standalone Reaching

- During the financial year ending March 31, 2013, the Company achieved turnover of Rs. 96959.33 lac as against turnover of Rs. 77820.88 lac achieved during the previous year, registering a growth of 25%.

- The Profit After Tax (PAT) for the year under review was Rs. 7581.55 lac against Rs. 6088.62 lac in 2012.

- Profit before Interest, Depreciation, Amortisation, Exceptional Items & Tax stood at Rs. 12752.65 lac as against Rs. 11046.62 lac in the previous year.

- Earnings per share stand at Rs.42.68 during the year 2013 vis a vis Rs. 35.15 achieved in the preceding year.

- The net worth of the Company increased from 39563.97 lac in the fiscal year 2013 to Rs. 26968.37 lac at the end of fiscal year 2012.

Consolidated Reaching

- During the financial year ending March 31, 2013, the Company achieved turnover of Rs.121520.18 lac as against turnover of Rs.103169.44 lac achieved during the previous year, registering a growth of 18%.

- The Profit After Tax (PAT) for the year under review was Rs. 11629.23 lac against Rs. 10120.35 lac in 2012.

- Profit before Interest, Depreciation, Amortisation, Exceptional Items & Tax stood at Rs.21001.14 lac as against Rs.19468.10 lac in the previous year.

- Earnings per share stand at Rs. 65.47 during the year 2013 vis a vis Rs. 58.42 achieved in the preceding year.

- The net worth of the Company increased from 57270.40 lac in the fiscal year 2013 to Rs. 40460.01 lac at the end of fiscal year 2012.

Appropriations:

Dividend:

Summary of Final Dividend declared by the Company in the year 2012 and recommended for the year 2013 are given below:

(Rs. in lac)

Final Dividend for the Year Rate of Amount of Dividend Total Dividend Dividend Distribution tax Outflow

2012 50% 866.19 140.52 1006.71

2013 (if approved by members) 60% 1085.88 184.54 1270.42

Your Directors recommend a final Dividend of 60% (Rs. 6/- per equity share of Rs. 10/- each) to be appropriated from the profitsof the year 2012-13, subject to the approval of the shareholders at the ensuing Annual General Meeting. The Dividend will be paid in compliance with the applicable regulations.

Pursuant to the approval of Board of Directors on November 5, 2012, your Company had distributed an interim dividend of Rs. 5/- per share, of face value of Rs. 10/- each.

The total dividend for the year ended on March 31, 2013, would accordingly be Rs.11 per Equity share (110% of face value) as against the total dividend of Rs. 10 per Equity share (100% of face value) for the year ended on March 31, 2012.

The total outgo due to Dividend of the Company was Rs. 2322.23 lac, including dividend distribution tax as against Rs.2013.42 lac in the previous year. The Dividend payout Ratio of your Company is 19.97%.

Transfers to Reserves:

The Company proposes to transfer Rs. 4000 lac to the general reserve out of the amount available for appropriations and an amount of Rs. 4000 lac is proposed to be retained in the statement of profit and loss.

Credit Ratings:

CRISIL has re-affirmed its ratings of AA-/Positive (Outlook Revised from ''Stable'') to the various bank facilities of Solar Industries India Ltd (SIIL). The ratings reflect SIIL''S strong market position, good operating efficiencies (backed by prudent raw material procurement policies and backward integration), and strong debt protection measures. To arrive at its ratings, CRISIL has combined SIIL''S financial and business profiles with those of its subsidiaries.

In addition to long Term rating, CRISIL has also assigned A1 (Reaffirmed) rating to SIIL for Short term Borrowing.

Commercial Paper:

During the year under review, your Company has raised Funds through issue of Commercial papers of Rs. 20 Crore by earmarking the Working Capital Limit from Yes Bank.

Details of the above said Commercial Paper is summarised below:

Name of Bank From To Rate of Interest

Religare Mutual Fund 1st November, 2012 28th December, 2012 8.85%

Directors:

Director''s Retiring by Rotation

Section 256 of Companies Act, 1956 and provisions containing in Articles of Association of the Company provide that at least two- third of our Directors shall be subject to retirement by rotation. One third of these retiring Directors must retire from office at each Annual General Meeting of the shareholders. A retiring Director is eligible for re-election. Shri Anant Sagar Awasthi, Shri Dilip Patel, Shri Satish Chander Gupta and Shri Ajai Nigam, retire by rotation and on being eligible offer themselves for re-appointment at this Annual General Meeting. Boards of Directors have recommended their re-appointment for consideration of the Shareholders.

The brief resumes and other details relating to the Directors who are proposed to be re-appointed, as required to be disclosed under Clause 49 of the Listing Agreement, forms an integral part of this Report.

Director''s Appointment

In accordance with Section 262 of the Companies Act, 1956 and Article 185 of the Articles of Association of the Company, Shri Amrendra Verma was appointed as a Non - Executive Independent Director in casual vacancy with effect from November 5, 2012. Shri Amrendra Verma would hold office till the conclusion of the Annual General Meeting of the Company scheduled to be held on September 11, 2013.

The requisite notices together with necessary deposits have been received from a Director pursuant to Section 257 of the Companies Act, 1956, proposing the election of Shri Amrendra Verma as a Non-Executive Independent Director of the Company.

Director''s Cessation

Shri Anand Kumar, a Non - Executive Independent Director has resigned from the Board effective from November 5, 2012.

The Directors wish to record their gratitude and appreciation for the wise counselling and contributions by Shri Anand Kumar during his tenure as the Director of the Company.

Attention of the Members is invited to the relevant item in the Notice of the Annual General Meeting and the Explanatory Statement thereto.

Auditors and their Observations M/s Gandhi Rathi & Co. Chartered Accountants, Statutory Auditors of the Company, hold office until the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment. The Company has received letters from the Auditors to the effect that their re-appointment, if made, would be within the prescribed limits under Section 224(1B) of the Companies Act, 1956 and that they are not disqualified for reappointment within the means of Section 226 of the said Act.

The Notes on Financial Statements referred to in the Auditors'' Report are self-explanatory and do not call for any further comments.

Particulars of Employees:

The Ministry of Corporate Affairs has vide notification dated March 31, 2011, enhanced the limits for the purpose of disclosure of particulars of employees in the Directors Report as requisite under section 217 (2A) of the Companies Act. 1956, read with Companies (Particulars of Employees) Amendment Rules, 2011.

Company is having Employees whose information in accordance with the provisions of Section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, amended as Companies (Particulars of Employees) Amendment Rules, 2011 are to be given.

However, pursuant to the provisions of Section 219(1 )(b) (iv) of the Companies Act, 1956, the Report and Accounts are being sent to the Members excluding the statement of particulars of employees. Any Member may obtain a copy of the said statement by writing to the Company Secretary at the registered office of the Company.

Subsidiary Operations:

As a purposeful strategy, your Company carries all its business operations through several subsidiaries and associate companies which are formed either directly or as step-down subsidiaries or in certain cases by acquisition of a majority stake in existing enterprises.

Incorporation of step Down subsidiary:

During the year under review, following step down Subsidiary Company was incorporated through our step down subsidiary Solar Overseas Netherlands B.V. at Indonesia:

- P.T. Solar Mining Services.

Transfer of stake:-

- During the year under review, Solar Industries India Limited has transferred its 74% stake in Navbharat Coalfields Limited to Navbharat Fuse Company Limited on the terms and conditions defined in various definitive Agreements.

Subsidiaries Financial Statement

The Ministry of Corporate Affairs (MCA) by General Circular No. 2/2011 dated February 08, 2011, had granted an exemption to companies from complying with Section 212 of the Companies Act, 1956, provided such companies fulfil conditions mentioned in the said circular. Accordingly, the Board of Directors of your Company at its meeting held on May 27, 2013, approved the Audited Consolidated Financial Statements for the financial year 2012-13 which includes financial information of all its subsidiaries and forms part of this report.

The Consolidated Financial Statements of your Company for the financial year 2012-13, have been prepared in compliance with the applicable Accounting Standards and the Listing Agreement, where applicable, as prescribed by the Securities and Exchange Board of India.

The annual accounts and financial statements of the subsidiary companies of your Company and related detailed information shall be made available to members on request and are open for inspection at the Registered Office of your Company. Your Company has complied with all the conditions as stated in the circular and accordingly has not attached the financial statements of its subsidiary Companies for the financial year 2012-13. A statement of summarised financials of all subsidiaries of your Company including capital, reserves, total assets, total liabilities, details of investment, turnover, etc., pursuant to the General Circular issued by the Ministry of Corporate Affairs, forms part of this report.

Statement of Management''s Responsibility for Consolidated Financial Statements:

Management is responsible for the preparation of the Consolidated Financial Statements and related information that are presented in this report. The Board of Directors of your Company at its meeting held on May 27, 2013, approved the Audited Consolidated Financial Statements for the financial year 2012-13 and its subsidiaries in accordance with Clause 32 of Listing Agreement with the Stock Exchanges and Accounting Standard (AS-21) and other Accounting Standards issued by the Institute of Chartered Accountants of India. The Consolidated Financial Statements of your Company for the financial year 2012-13, are prepared in compliance with applicable Accounting Standards based on the management''s estimates, assumptions and judgments where applicable as well as Listing Agreement as prescribed by the Securities and Exchange Board of India.

The Company has built adequate systems of internal controls aimed at achieving efficiency in operations, optimum utilisation of resources, effective monitoring and compliance with all applicable laws.

The Internal Audit function monitors the effectiveness of controls, and also provides an independent and objective assessment of the overall governance processes in the Company, including the application of a systematic risk management framework. The Audit Committee of the Board reviews major internal audit reports as well as the adequacy of internal controls.

Solar''s Corporate Governance Philosophy:

Corporate Governance philosophy of the Company is based on the principles of equity, fairness, transparency, spirit of law and honest communication. The Company believes that sound Corporate Governance is necessary to retain stakeholder''s trust and ensures efficient working and proper conduct of the business of the Company with integrity. Development of Corporate Governance guidelines is a continuous process which evolves over a period of time and undergoes changes to suit the changing times and needs of the business, society and the nation.

Your Company has implemented the conditions of Corporate Governance as contained in Clause 49 of the Listing Agreement with the Stock Exchanges. A separate report on Corporate Governance and Management Discussion and Analysis along with necessary certificates is given elsewhere in this report. Also certificate by M/s Gandhi Rathi & Co. Chartered Accountants, Nagpur, Statutory Auditors of the Company, confirming compliance of the conditions of Corporate Governance as stipulated under clause 49 of the Listing Agreement, is annexed to this report.

Allotment of Equity Shares on Preferential basis:

The Company has entered into a Subscription- cum-Shareholders Agreement (SSA) with Oman India Joint Investment Fund (OIJIF) on August 16, 2012, pursuant to which an amount of Rs. 72,00,01,350/- has been received during the year from OIJIF towards subscription to equity shares in the Company.

In terms of the special resolution passed at the Extraordinary General meeting of the members of the Company, held on August 27, 2012, the Company was authorised to issue 7,74,195 Equity Shares to OIJIF, on preferential basis, at a price of Rs. 930/- per Equity Share, determined in terms of SEBI''s Issue of Capital and Disclosure Requirement (ICDR) Guidelines. Accordingly, the Board of Directors of the Company, at its meeting held on September 06, 2012, allotted 7,74,195 Equity Shares of Rs. 10/- each on preferential basis at a premium of Rs. 920/- per share to OIJIF.

Unclaimed application monies Received During Initial Public Offer

As per Section 205C of Companies Act, 1956; the Application Money received during Initial Public Offer (IPO) which have remained unclaimed and unpaid for a period of seven years from the date they became due for payment shall be credited to the Investor Education and Protection Fund (IEPF) administered by the Central Government and thereafter cannot be claimed by investors.

The Board in its Board Meeting dated April 8, 2013, has approved the transfer of Application Moneys amounting to Rs. 2,70,940/- (Rupees Two Lac Seventy thousand and Nine Hundred forty only) received during Initial Public Offer for allotment of Shares and lying in IPO Accounts due for refund to Investor Education and Protection Fund (IEPF) Account within the specified due date.

In view of the unpaid Dividends also, Members of the Company, who have not yet encashed their dividend warrant(s) may write to the Company immediately.

In accordance with newly inserted Clause 5A of Listing Agreement, the Company has identified 4 folios comprising of 134 equity shares of face value of Re.10/- each, which are unclaimed as on March 31, 2013. The Company has sent the reminders to the concerned shareholders in accordance with the said clause.

Management Discussion and Analysis Report:

A detailed review of operations, performance and future outlook of your Company and its businesses is given in the Management Discussion and Analysis, which forms part of this Report as stipulated under Clause 49 of the Listing Agreement with the Stock Exchange(s) in India.

CEO/CFO Certification:

As required under Clause 49 of the Listing Agreement, the CEO/CFO certification is attached with the annual report.

Director''s Responsibility Statement:

Pursuant to section 217 (2AA) of the Companies Act, 1956, the Board of Directors hereby confirms that:

i. In the preparation of the annual accounts of the Company for the year ended March 31, 2013, the applicable Accounting Standards have been followed and there are no departures.

ii. Accounting policies have been selected and applied consistently and judgments and estimates made that are reasonable and prudent so as to give true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period.

iii. Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of this act for safeguarding the assets of the Company and detecting fraud and other irregularities.

iv. Annual accounts for the year ended March 31, 2013, have been prepared on a going concern basis.

Appreciation & Acknowledgement

Your Directors are thankful to the various Central and State Government Departments and Agencies for their continuous help and co-operation. The Directors are grateful to the various stakeholders, customers, shareholders, banks, dealers, vendors and other business partners for the excellent support received from them during the year under review.

Your Directors wish to place on record their sincere appreciation to all employees for their commitment and continuous contribution to the Company.

For and on behalf of the Board

Place : Nagpur (Styanarayan Nuwal)

Date : May 27, 2013 Director


Mar 31, 2012

To,The Members of Solar Industries India Limited;

The take pleasure in presenting 17th Annual Report of the Company together with the Annual Accounts (Standalone & Consolidated) for the year ended March 31, 2012.

Performance Highlights (Stand Alone): (Rs. in lacs)

Particulars 2012 2011

Gross Turnover 77820.87 57046.61

Less : Excise Duty 5446.16 3646.01

Net Turnover 72374.71 53400.60

Profit Before Interest, Depreciation And Taxation 11046.61 9379.31

Less : Depreciation 804.77 663.55

Profit before interest and taxation 10241.84 8715.76

Less : Interest 2008.81 1144.97

Profit before tax and exceptional item 8233.03 7570.79

Less : Exceptional item 315.04 -

Profit before tax 7917.99 7570.79

Less : Provision For Taxation 1829.39 2541.44

Net profit after tax 6088.60 5029.35

Balance brought forward 6644.41 4619.53

Balance available for appropriation 12733.01 9648.88

Appropriation:

Interim dividend 866.19 692.95

Proposed dividend 866.19 692.95

Tax on dividend 144.77 118.57

General reserve 2000.00 1500.00

Balance profit carried to balance sheet 8855.86 6644.41

Earning per share (Eps) 35.15 29.03

Performance Highlights (Consolidated): (Rs. in lacs)

Particulars 2012 2011

Gross Turnover 103169.43 72426.26

Less : Excise Duty 6411.94 4340.73

Net Turnover 96757.49 68085.53

Profit before interest, depreciation and taxation 19468.10 14797.95

Less : Depreciation 1278.14 766.21

Profit before interest and taxation 18189.96 14031.75

Less : Interest 2357.58 1266.53

Profit before tax and exceptional item 15832.38 12805.22

Less : Exceptional item 436.58 -

Profit before tax 15395.80 12805.22

Less provision for taxation 4254.51 4509.68

Net profit after tax 11141.29 8295.54

Share of profit transfer to minority 1020.94 735.88

Stock reserve 175.94 -

Balance brought forward 11401.31 8457.74

Balance available for appropriation 21697.60 16017.39

Appropriation:

Interim dividend 866.19 692.95

Proposed dividend 866.19 692.95

Tax on dividend 281.04 230.18

General reserve 4000.00 3000.00

Balance profit carried to balance sheet 15684.18 11401.31

Profit & Loss of Solar Capitals Limited - 1106.03

Earning per share (EPS) 58.42 43.64

Year in Retrospect:

Standalone Performance

- The total revenue of the Company for fiscal year 2012 stood at Rs.77,820.87 lacs as against Rs.57,046.61 lacs for fiscal year 2011 showing an increase of 36.42%.

- The EBIDTA increased by 17.78% from Rs.9,379.31 lacs in fiscal year 2011 to Rs.11,046.61 lacs in fiscal year 2012.

- Profit after tax witnessed a growth of 21.06% from Rs.5,029.35 lacs in fiscal year 2011 to Rs.6,088.60 lacs in fiscal year 2012.

- The net worth of the Company increased from Rs.22,756.90 lacs at the end of fiscal year 2011 to Rs.26,968.35 lacs at the end of fiscal year 2012.

Consolidated Performance

- The total revenue of the Company for fiscal year 2012 stood at Rs.1,03,169.43 lacs as against Rs.72,426.26 lacs for fiscal year 2011 showing an increase of 42.45%.

- The EBIDTA increased by 31.56% from Rs.14,797.95 lacs in fiscal year 2011 to Rs.19468.10 lacs in fiscal year 2012.

- Profit after tax witnessed a growth of 33.87% from Rs.7,559.66 lacs in fiscal year 2011 to Rs.10,120.35 lacs in fiscal year 2012.

- The net worth of the Company increased from Rs.31,603.96 lacs at the end of fiscal year 2011 to Rs.40,460.01 lacs at the end of fiscal year 2012.

Appropriations:

Dividend:

Summary of final dividend declared by the Company in the year 2011 and recommended for the year 2012 are given below:

(Rs. in lacs)

Final Dividend Rate of Amount Divided Total for the Year Divided of Divided Distribution tax Outflow

2011 40% 692.95 115.09 808.04

2012 (if approved by members) 50% 866.19 140.52 1006.71

Your Director pleased to recommend a final Dividend of Rs.5 per Equity Share of Rs.10 each. The Company had distributed an Interim Dividend of Rs.5 per Equity share in the month of November, 2011. The total dividend for the year ended on March 31, 2012 would accordingly be Rs.10 per Equity share (100% of face value) as against the total dividend of Rs.8 per Equity share (80% of face value) for the year ended on March 31, 2011. The total outgo due to Interim Dividend of the Company was Rs.1006.71 lacs, including dividend distribution tax as against Rs.808.04 lacs in the previous year. The Dividend payout Ratio of your Company is 19.89%.

Transfers to Reserves:

We propose to transfer Rs.4000 lacs (40% of net profit for the year) to the general reserve. An amount of Rs.15684.18 Lacs is proposed to be retained in the Profit & Loss account.

Credit Ratings:

CRISIL has reaffirmed its ratings of AA-/Positive (Outlook Revised from 'Stable') to the various bank facilities of Solar Industries India Ltd (SIIL). The ratings reflect SIIL'S strong market position, good operating efficiency (backed by prudent raw material procurement policies and backward integration), and strong debt protection measures. To arrive at its ratings, CRISIL has combined SIIL'S financial and business profiles with those of its subsidiaries.

In addition to long-term rating, CRISIL has also assigned A1 (Reaffirmed) rating to SIIL for short-term borrowing.

Directors:

Director's Retiring by Rotation

As per Section 256 of Companies Act, 1956 and provisions contained in Articles of Association of the Company provide, that at least two-third of our Directors shall be retiring by rotation. One third of these retiring Directors must retire from office at each Annual General Meeting of the shareholders. A retiring Director is eligible for re-election. Shri Satish Chander Gupta, Shri Dilip Patel, Shri Ajai Nigam and Shri Anand Kumar, retire by rotation and being eligible offer themselves for re-appointment at this Annual General Meeting. Board of Directors have recommended their re-appointment for consideration of the shareholders.

Auditors and their Observations

M/s Gandhi Rathi & Co. Chartered Accountants, Statutory Auditors of the Company, hold office until the conclusion of the ensuing Annual General Meeting and are eligible for re-appointment. The Company has received letters from the Auditors to the effect that their re-appointment, if made, would be within the prescribed limits under Section 224(1B) of the Companies Act, 1956 and that they are not disqualified for re- appointment within the meaning of Section 226 of the said Act.

The Notes on Financial Statements referred to in the Auditors' Report are self-explanatory and do not call for any further comments.

Particulars of Employees:

There are no personnel, who were paid with the salary of a limit more than that specified under section 217 (2A) of the Companies Act. 1956.

Subsidiary Operations:

As a purposeful strategy, your Company carries all its business operations through several subsidiary and associate companies which are formed either directly or as step-down subsidiaries or in certain cases by acquisition of a majority stake in existing enterprises.

Incorporation of Step down Subsidiaries:-

During the year under review following step down Subsidiary Company was incorporated through our step down subsidiary Solar Overseas Netherlands B.V.:

- Solar Explochem (Ghana) Limited

Acquisitions:-

During the year under review Solar Industries India Limited has increased its holding from 51% to 100% in Solar Mining Resources Limited.

In the year under review Solar Industries India Limited through its step down subsidiary Solar Overseas Netherlands B.V. has increased its stake from 54% to 74.50% in Ilci Patlayici Maddeler Sanayi Ve Ticaret Anonim Sirketi (ILCI).

During the year under review, Company's step down subsidiary, Nigachem Nigeria Limited has allotted 90,909,091 additional shares to Nigerian Shareholders. This additional allotment has reduced the stake of Solar Overseas Netherlands Cooperatie U.A. from 70% to 55%.

Subsidiaries Financial Statement

The Ministry of Corporate Affairs, Government of India, vide General Circular No. 2 and 3 dated February 8, 2011 and February 21, 2011 respectively has granted a general exemption from compliance with section 212 of the Companies Act, 1956, subject to fulfillment of conditions stipulated in the circular. The Company has satisfied the conditions stipulated in the circular and hence is entitled to the exemption. Necessary information relating to the subsidiaries has been included in the Consolidated Financial Statements.

The Company will make available the annual accounts of the subsidiary companies and the related detailed information to any member of the Company who may be interested in obtaining the same. The annual accounts of the subsidiary companies will also be kept open for inspection at the Registered Office of the Company and that of the respective subsidiary companies. The Consolidated Financial Statements presented by the Company include the financial results of its subsidiary companies.

Solar's Corporate Governance Philosophy:

Corporate Governance philosophy of the Company is based on the principles of equity, fairness, transparency, spirit of law and honest communication. The Company believes that sound Corporate Governance is necessary to retain stakeholder's trust and ensures efficient working and proper conduct of the business of the Company with integrity. Development of Corporate Governance guidelines is a continuous process which evolves over a period of time to suit the changing needs of the business, society and the nation.

Your Company has implemented the conditions of Corporate Governance as contained in Clause 49 of the Listing Agreement with the Stock Exchanges. A separate report on Corporate Governance and Management Discussion and Analysis along with necessary certificates is given elsewhere in this report. Also certificate by M/s Gandhi Rathi & Co. Chartered Accountants, Nagpur, statutory auditors of the Company, confirming compliance of the conditions of Corporate Governance as stipulated under clause 49 of the Listing Agreement, is annexed to this report.

Management Discussion and Analysis Report:

The Management's Discussion and Analysis on Company's performance, industry trends, future outlook and other material changes with respect to the Company and its subsidiaries, wherever applicable, are presented in this annual report as stipulated under Clause 49 of the Listing Agreement with the Stock Exchange(s) in India.

CEO/CFO Certification:

As required under Clause 49 of the Listing Agreement, the CEO/CFO certification is attached with the annual report.

Pursuant to Notification dated February 28, 2011 issued by the Ministry of Corporate Affairs, the format for disclosure of financial statement prescribed under Schedule VI to the Companies Act, 1956 has been substantially revised. The financial results of the Company for the year ended March 31, 2012 have therefore been disclosed as per the revised Schedule VI. Previous year's figures have also been restated to confirm with the current year's presentation.

Statement of Management's Responsibility For Consolidated Financial Statements:

Management is responsible for the preparation of the Consolidated Financial Statements and related information that are presented in this report. The Board of Directors of your Company at its meeting held on May 25, 2012, approved the Audited Consolidated Financial Statements for the financial year 2011-12 and its subsidiaries in accordance with Clause 32 of Listing Agreement with the stock exchanges and Accounting Standard (AS-21) and other Accounting Standards issued by the Institute of Chartered Accountants of India. The Consolidated Financial Statements of your Company for the financial year 2011-12, are prepared in compliance with applicable Accounting Standards based on management's estimates, assumptions and judgments where applicable as well as Listing Agreement as prescribed by the Securities and Exchange Board of India.

The Company has built adequate systems of internal controls aimed at achieving efficiency in operations, optimum utilisation of resources, effective monitoring and compliance with all applicable laws.

The internal audit function monitors the effectiveness of controls, and also provides an independent and objective assessment of the overall governance processes in the Company, including the application of a systematic risk management framework. The Audit Committee of the Board reviews major internal audit reports as well as the adequacy of internal controls.

Solar's Employee Stock Option Plan:

Shareholders have approved Employees Stock Option Scheme in December, 2011. A few options granted in December, 2011 have been technically surrendered and thus as at the end of the year, no option is outstanding.

Director's Responsibility Statement:

Pursuant to section 217 (2AA) of the Companies Act, 1956 the Board of Directors hereby confirms that:

i. In the preparation of the annual accounts of the Company for the year ended March 31, 2012, the applicable Accounting Standards had been followed without any departures.

ii. Accounting policies have been selected and applied consistently and judgments and estimates made that are reasonable and prudent so as to give true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period.

iii. Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of this act for safeguarding the assets of the Company and detecting fraud and other irregularities.

iv. Annual accounts for the year ended March 31, 2012 have been prepared on a going concern basis.

Appreciation and Acknowledgement

Your Directors take this opportunity to thank the customers, shareholders, suppliers, bankers, business partners/associates, financial institutions, stock exchanges and Central and State Governments for their consistent support and encouragement.

The Board places on record their appreciation for the support and co-operation that your Company has been receiving from its suppliers, business partners and others associated with the Company as its trading partners. Your Company looks upon them as partners in its progress and has shared with them the rewards of growth. It will be Company's endeavour to build and nurture strong links with mutually beneficial trade based on, respect to and co-operation with each other, consistent with consumer interests.

I am sure you will join our Directors in conveying sincere appreciation to all employees of the Company at all levels for their hard work and commitment and dedication. The enthusiasm and unstinting efforts of the employees have enabled the Company to remain at the forefront of the industry.

For and on behalf of the Board

Place : Nagpur (Satyanarayan Nuwal)

Date : May 25, 2012 Director


Mar 31, 2011

The Members;

We take pleasure in presenting Sixteenth Annual Report of the Company together with the Annual Accounts (Standalone & Consolidated) for the year ended 31st March, 2011.

Performance Highlights (Standalone):

(Rs. in Lacs)

Particulars 2011 2010

Turnover 56767.45 50185.51

Profit Before Interest, Depreciation And Taxation 9340.80 6752.12

Less : Depreciation 663.55 632.00

Profit Before Interest And Taxation 8677.25 6120.12

Less : Interest 1106.46 1201.04

Profit Before Tax 7570.79 4919.08

Less : Provision For Taxation 2541.44 1792.55

Net Profit After Tax 5029.35 3126.53

Balance Brought Forward 3513.50 2805.73

Balance Available For Appropriation 8542.85 5932.26

Appropriation:

Interim Dividend 692.95 606.33

Proposed Dividend 692.95 606.33

Tax On Dividend 118.57 206.09

General Reserve 1500.00 1000.00

Balance Profit Carried To Balance Sheet 5538.38 3513.50

Earning Per Share (EPS) 29.03 18.05

Turnover 72285.81 59019.32

Profit Before Interest, Depreciation And Taxation 14847.28 11199.78

Less : Depreciation 766.21 784.96

Profit Before Interest And Taxation 14081.07 10414.82

Less : Interest 1275.86 1335.98

Profit Before Tax 12805.22 9078.84

Less : Provision For Taxation 4509.68 3219.47

Net Profit After Tax 8295.54 5859.37

Share of Profit Transfer To Minority 735.88 0.00

Balance Brought Forward 8457.74 6017.12

Balance Available For Appropriation 16017.39 11876.49

Appropriation:

Interim Dividend 692.95 606.33 Proposed Dividend 692.95 606.33

Tax On Dividend 230.18 206.09

General Reserve 3000.00 2000.00

Balance Profit Carried To Balance Sheet 11401.31 8457.74

Earning Per Share(EPS) 43.64 33.82

Results of Operations:

Summary of Results for Fiscal Years 2011, 2010, and 2009

Percentage Percentage change 2010 change 2010 2011 2010 2009 versus 201 Oversus 2009

Revenue 72285.81 59019.32 53037.94 22.48% 11.28%

Operating Income 8295.54 5859.37 4413.63 41.58% 32.76%

Earning per share 43.64 33.82 25.48 29.04% 32.73%

Total gross turnover of your Company rose by 22.48 % from Rs. 59,019.32 Lacs in FY 2009-10 to 72,285.81 Lacs in FY 2010-11. The profit before interest, depreciation and tax (PBIDT), has increased by 32.57% from Rs. 11,199.78 Lacs in FY 2009-10 to Rs. 14,847.28 Lacs in FY 2010-11.

The Profit Before Tax (PBT) has increased by 41.04% from 9078.84 Lacs in FY 2009-10 to 12,805.22 Lacs in FY 2010-11 and the Profit After Tax (PAT) has increased by 29.02% from 5,859.37 Lacs in FY 2009-2010 to Rs. 7,559.66 Lacs in FY 2010-11.

Appropriations:

Dividend:

During the Year under review, your Directors had declared and paid interim dividend as per details given below:

(Rs. in Lacs)

Interim Dividend paid during the Rate of Dividend Amount of Distribution tax paid Total Outflow year ended 31st March, 2011 Dividend paid by the Company

Declared on 29th October, 2010 40% 692.95 115.09 808.04 and paid on 15th November, 2010

Your Director's are please to recommend a final Dividend of Rs. 4.00 per share (40% on a par value of Rs. 10) for the approval of members. The Final Dividend if declared as above would involve an outflow of Rs. 692.95 Lacs towards the Dividend {previous year Rs. 606.33} and Rs. 115.09 Lacs towards dividend tax {previous year 103.05 Lacs} resulting in a total outflow of Rs. 808.04 Lacs as against 709.38 in the previous year. The Dividend Payout Ratio of your Company is 21.38 %.

Transfers to Reserves:

We propose to transfer Rs. 3000 Lacs (39.68% of net profit for the year- to the general reserve. An amount of Rs. 2943.57 Lacs is proposed to be retained in the Profit & Loss account.

Credit Ratings:

CRISIL has re-affirmed its ratings of 'AA-/Stable/P1 ' to the various bank facilities of Solar Industries India Limited (SIIL). The ratings reflect Solar Industries India Limited's strong market position, good operating efficiencies (backed by prudent raw material procurement policies and backward integration), and strong debt protection measures. To arrive at its ratings, CRISIL has combined Solar Industries India Limited's financial and business profiles with those of its subsidiaries.

In addition to long Term rating, CRISIL has also assigned P1 rating to Solar Industries India Limited for Short term Commercial Paper.

Commercial Paper:

During the year under review, your Company has raised Funds through issue of Commercial papers of Rs. 25 Crores by earmarking the Working Capital Limit from Bank of India and State Bank of India.

Details of these Commercial Papers are summarised below:

Name of Bank From To Rate of Interest

Deutche Mutual Fund 25th May, 2010 24th August, 2010 5.40%

SBI Global 18th August, 2010 15th November, 2010 7.40%

Allahabad Bank 15th November, 2010 15th February, 2011 8.65%

Directors:

Directors Retiring by Rotation

As per Section 256 of Companies Act, 1956 and provisions containing in Articles of Association of the Company provide that at least two-third of our Directors shall be subject to retirement by rotation. One third of these retiring Directors must retire from office at each Annual General Meeting of the shareholders. A retiring Director is eligible for re-election. Mr. Manish Nuwal, Mr. Kailashchandra Nuwal, Mr. Kundan Singh Talesra, and Mr. Anant Sagar Awasthi, retire by rotation and being eligible offer themselves for re-appointment at this Annual General Meeting. Boards of Directors have recommended their re- appointment for consideration of the Shareholders.

Director's Appointment

In accordance with Section 262 of the Companies Act, 1956 and Article 185 of the Articles of Association of the Company, Mr. Anand Kumar was appointed as a Non-Executive Independent Director in casual vacancy with effect from 29th October, 2010. Mr. Anand Kumar would hold office till the conclusion of the Annual General Meeting of the Company scheduled to be held on 10th August, 2011.The requisite notices together with necessary deposits have been received from a Director pursuant to Section 257 of the Companies Act, 1956, proposing the election of Mr. Anand Kumar as a Non-Executive Independent Director of the Company.

Director's Re-appointment

During the year under review, the Board of Directors had re-appointed Shri Satyanarayan Nuwal and Shri Roomie Dara Vakil as Executive Director for a period of 5 years and 3 years respectively from 1st April, 2011.

Director's Cessation

Dr. Rishi Narain Singh, a Non-Executive Independent Director has resigned from the board effective from 29th October, 2010.

The Board placed on record its deep sense of appreciation for invaluable contribution made by Dr. Rishi Narain Singh during his tenure as a Non-Executive Independent Director of the Company.

Auditors & Their Observations:

M/s Gandhi Rathi & Co. Chartered Accountants, Statutory Auditors of the Company will retire at the forthcoming Annual General Meeting, and being eligible, offer themselves for re-appointment. The Company has received a certificate from the Auditors to the effect that their re-appointment, if made, would be in accordance with Section 224(1B) of the Companies Act, 1956. The Board recommends their re-appointment.

The notes to the accounts referred to in the Auditor's Report are self-explanatory and therefore do not call for any further comments.

Particulars of Employees:

There are no personnel, who were paid with the salary of a limit more than that specified under section 217 (2A) of the Companies Act, 1956.

Subsidiary Operations:

As a purposeful strategy, your Company carries all its business operations through several subsidiary and associate companies which are formed either directly or as step-down subsidiaries or in certain cases by acquisition of a majority stake in existing enterprises.

Amalgamation:

During the year under review, Solar Components Pvt. Ltd. (Wholly owned Subsidiary- amalgamated with Economic Explosives Ltd (Wholly owned Subsidiary- under the provisions of Sections 391 to 394 of the Companies Act, 1956.

The said company was amalgamated, as per the order of the Hon'ble High Court of Judicature at Bombay Nagpur Bench, Nagpur dated 1st September, 2010.

Incorporation of Step Subsidiaries:

During the year under review, following two step Subsidiary Companies were incorporated through our wholly owned subsidiary Solar Overseas Netherlands Cooperatie U.A.:

& Solar Explochem Mauritius Ltd. at Mauritius. & Solar Overseas Netherlands B.V. at Netherlands.

Acquisitions:

During the year under review, Solar Industries India Limited Acquired 54% stake, through its Step Subsidiary Solar Overseas Netherlands B.V in following two Companies at Turkey:

ILCI Patlayici Maddeler Sanayi ve Ticaret A.S.

Patlayici Maddeler San. ve Tic. A.S. ("Patsan"),

During the year under review, Solar Industries India Limited also acquired 70% stake, in Nigachem Nigeria Limited through its Subsidiary Solar Overseas Netherlands Cooperatie U.A.

Further During the year under review, Solar Industries India Limited Acquired 65% stake, in Solar Explochem Zambia Limited through its Subsidiary Solar Overseas Netherlands Cooperatie U.A.

In the year under review, Solar Industries India Limited acquired 100% stake, in Solar Overseas Singapore PTE Limited through its Subsidiary Solar Overseas Mauritius Limited.

In the year under review, Solar Industries India Limited acquired 80% stake, in Solar Mining Services Australia PTY Limited through its step Subsidiary Solar Overseas Singapore PTE Limited.

Exemption under section 212

We have 12 subsidiaries.

The Annual Report 2010-11 does not contain the financia statements of our subsidiaries, accordingly the Company will make available the audited annual accounts and related information of our subsidiaries, where applicable, upon request. These documents will also be available for inspection during business hours at our registered office in Nagpur, India. The same will also be published on our website, www.solarexplosives.com

As per Section 212 of the Companies Act, 1956, we are required to attach the Directors' Report, Balance Sheet, and Profit and Loss account of our subsidiaries to the Balance Sheet of Holding Company. The Ministry of Corporate Affairs, Government of India vide its circular no. 2/2011 dated February 8, 2011 has provided an exemption to companies from complying with Section 212, provided such companies publish the audited consolidated financial statements in the Annual Report.

Statement pursuant to section 212 (8) of the Companies Act, 1956 containing details of the Subsidiaries of the Company forms part of this Annual Report.

Current Holding Structure of Solar Industries India Limited

Company's Philosophy on Corporate Governance:

Corporate Governance philosophy of the Company is based on the principles of equity, fairness, transparency, spirit of law and honest communication. The Company believes that sound Corporate Governance is necessary to retain stakeholder's trust and ensures efficient working and proper conduct of the business of the Company with integrity. Development of Corporate Governance guidelines is a continuous process which evolves over a period of time and undergoes changes to suit the changing times and needs of the business, society and the nation.

Your Company has implemented the conditions of Corporate Governance as contained in Clause 49 of the Listing Agreement with the Stock Exchanges. A separate report on Corporate Governance and Management Discussion and Analysis along with necessary certificates is given elsewhere in this report. Also certificate by M/s Gandhi Rathi & Co. Chartered Accountants, Nagpur, Statutory Auditors of the Company, confirming compliance of the conditions of Corporate Governance as stipulated under clause 49 of the Listing Agreement, is annexed to this report.

Management Discussion and Analysis Report:

The Management Discussion and Analysis Report forming part of Director's Report for the year under review, as stipulated under Clause 49 of the Listing Agreement with the Stock Exchange(s) in India, forms part of this Annual Report. The report provides strategic direction and a more detailed analysis on the performance of individual businesses and their outlook.

CEO/CFO Certification:

As required under Clause 49 of the Listing Agreement, the CEO/CFO certification is attached with the Annual Report.

Statement of Management's Responsibility for Consolidated Financial Statements:

Management is responsible for the preparation of the Consolidated Financial Statements and related information that are presented in this report. The Consolidated Financial Statements of the Company and its subsidiaries, which include amounts based on management's estimates and judgments, have been prepared in conformity with Accounting Standard 21 prescribed by The Institute of Chartered Accountants of India, forms part of this Annual Report and Accounts.

The Company designs and maintains accounting and internal control systems to provide reasonable assurance at reasonable cost that assets are safeguarded against loss from unauthorised use or disposition, and that the financial records are reliable for preparing Financial Statements and maintaining accountability for assets. These systems are augmented by written policies, an organizational structure providing division of responsibilities, careful selection and training of qualified personnel and a program of internal audits.

The Board of Directors, through its Audit Committee meets periodically with Management and Internal Auditors to discuss matters concerning Internal Controls and Financial Reporting.

Director's Responsibility Statement:

Pursuant to section 217 (2AA) of the Companies Act, 1956 the Board of Directors hereby confirms that:

i. In the preparation of the annual accounts of the Company for the year ended 31st March, 2011, the applicable Accounting Standards had been followed and there are no departures.

ii. Accounting policies have been selected and applied consistently and judgments and estimates made that are reasonable and prudent so as to give true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period.

iii. Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of this act for safeguarding the assets of the Company and detecting fraud and other irregularities.

iv. Annual accounts for the year ended 31st March, 2011 have been prepared on a going concern basis.

Appreciation & Acknowledgement:

Your Directors wish to place on record their gratitude for the valuable guidance and support given by Government of India, various State Government departments, Financial Institutions, Banks, and various stake holders, such as, shareholders, customers, suppliers etc. The Directors also commend the continuing commitment and dedication of the employees at all levels which has been critical for the Company's growth. Their dedication and competence has ensured that the Company continues to be a significant and leading player in an Explosives Industry. The Directors look forward to their continued support in future.

For and on behalf of the Board

Place : Nagpur (Manish Nuwal) Date : 19th May, 2011 Director


Mar 31, 2010

We take pleasure in presenting Fifteenth Annual Report of the Company together with the Annual Accounts (Standalone & Consolidated) for the year ended 31st March, 2010.

Performance Highlights (Standalone):

(Rs. in lacs)

PARTICULARS 2010 2009

Turnover 50185.51 45631.44

Profit Before Interest, 6851.12 6529.51

Depreciation And Taxation

Less : Depreciation 632.00 489.39

Profit Before Interest And 6219.12 6040.12

Taxation

Less: Interest 1300.04 2303.02

Profit Before Tax 4919.07 3737.10

Less Provision For Taxation 1792.55 1216.64

Net Profit After Tax 3126.52 2520.46

Balance Brought Forward 2805.74 2197.34

Balance Available For 5932.26 4717.80

Appropriation

Appropriation:

Interim Dividend 606.33 0.00

Proposed Dividend 606.33 779.59

Tax On Dividend 206.10 132.49

General Reserve 1000.00 1000.00

Balance Profit Carried To 3513.50 2805.73

Balance Sheet

Earning Per Share (Eps) 18.05 14.55



RESULTS OF OPERATIONS:

Total revenue of your Company rose by 11.28% from Rs. 53037.94 Lacs in FY 2008-2009 to Rs. 59019.31 Lacs in FY 2009-2010. The Profit Before Interest, Depreciation and Tax (PBIDT), has increased by 16.99% from Rs. 9573.33 in 2008-2009 to Rs. 11199.78 Lacs in FY 2009-2010.

DIVIDEND:

During the Year under review, your Directors had declared and paid interim dividend as per details given below:

(Rs. in lacs) Interim Dividend paid during the year ended Rate of Amount Distribution Total 31st March, 2010 Dividend of Dividend tax paid Outflow paid by the Company Declared on 27th january. 35% 606.33 103.04 709.137 2010 and paid on 18th February. 2010 18th February, 2010

Your Directors are please to recommend a final Dividend of Rs. 3.50 per share (35% on a par value of Rs.10) for the approval of members. The Final Dividend if declared as above would involve an outflow of Rs. 606.33 Lacs towards the Dividend {previous year Rs. 779.57} and Rs. 103.05 Lacs towards dividend tax {previous year Rs. 132.49 Lacs} resulting in a total outflow of Rs. 709.38 Lacs as against Rs. 912.06 in the previous year. The Dividend Payout Ratio of your Company is 24.21%.

CREDIT RATINGS:

CRISIL has re-affirmed its ratings of AA-/Stable/P1 + to the various bank facilities of Solar Industries India Ltd (SIIL). The ratings reflect SIILs strong market position, good operating efficiencies (backed by prudent raw material procurement policies and backward integration), and strong debt protection measures. To arrive at its ratings, CRISIL has combined SIILs financial and business profiles with those of its subsidiaries.

In addition to long term rating, CRISIL has also assigned P1+ rating to SIIL for short term Commercial Paper.

COMMERCIAL PAPER:

Our Company has raised Funds through issue of Commercial papers of Rs. 25 Crores @6.40% p.a. from Allahabad Bank by earmarking the Working Capital Limit from Bank of India & State Bank of India.

DIRECTORS:

Shri. Satyanarayan Nandlal Nuwal, Shri. Roomie Dara Vakil, Shri. Satish Chander Gupta, Shri. Dilip Patel are the Directors retiring by rotation under section 256 of Companies Act, 1956, at this Annual General Meeting and being eligible offer themselves for re-appointment.

The Board of Directors at its meeting held on October 27, 2009 appointed Shri. Ajai Nigam as Non Executive Independent Additional Director of the Company.

Shri. Ramesh Chandra Tripathi, Director has resigned from the board effective January 27, 2010.

The Board placed on record its deep sense of appreciation for invaluable contribution made by Shri. Ramesh Chandra Tripathi during his tenure as Independent Director of the Company.

AUDITORS & THEIR OBSERVATIONS:

M/s. Gandhi Rathi & Co. Chartered Accountants, Auditors of the Company will retire at the forthcoming Annual General Meeting, and being eligible, offer themselves for re-appointment. The Company has received a certificate from the Auditors to the effect that their re-appointment, if made, would be in accordance with Section 224(1 B) of the Companies Act, 1956.

The Board recommends their re-appointment.

The notes to the accounts referred to in the Auditors Report are self-explanatory and therefore do not call for any further comments.

PARTICULARS OF EMPLOYEES:

There are no personnel, who were paid with the salary of a limit more than that specified under section 217 (2A) of the Companies Act, 1956.

SUBSIDIARY OPERATIONS:

During the year under review :

* Shares of Somu Steels & Power Limited (subsidiary) had been transferred to other shareholders by the Company therefore now it is not a subsidiary of Solar Industries India Limited.

During the year under review two new Overseas Subsidiary Companies:

* Solar Overseas Mauritius Ltd was incorporated at Mauritius.

* Solar Overseas Netherlands Cooperatie U.A. was incorporated at Netherlands.

The Company has applied to the Central Government pursuant to Section 212(8) of the Companies Act, 1956 for exempting the company from attaching a copy of Balance Sheet, Profit & Loss A/C and other documents in respect of Subsidiary Companies for the Year ended 31 st March 2010.

Statement pursuant to section 212 (8) of the Companies Act, 1956 containing details of the Subsidiaries of the Company forms part of Annual Report.

Annual accounts of the subsidiary companies are kept for inspection by any investor at the Registered Office of your Company as well as at the Registered Office of the respective subsidiary companies. Any investor interested in a copy of the accounts of the subsidiaries may write to the Company Secretary at the Registered Office of the Company.

INTERNAL CONTROL SYSTEM:

The Company has adequate internal control procedures commensurate with its size and nature of business.

The Company has appointed Internal Auditors who audit the adequacy and effectiveness of internal controls laid down by the Management and suggests improvements.

The Audit Committee of the Board of Directors periodically reviews the audit plans, internal audit reports, and adequacy of internal controls and risks management.

CORPORATE GOVERNANCE:

Pursuant to the requirements of Clause 49 of the Listing Agreement with the Stock Exchanges, a report of corporate governance forms part of the Annual Report. A certificate by M/s. Gandhi Rathi & Co. Chartered Accountants, Nagpur, Auditors of the Company, confirming compliance of the conditions of corporate governance as stipulated under clause 49 of the Listing Agreement, is annexed to this report.

CONSOLIDATED FINANCIAL STATEMENTS:

The Consolidated Financial Statements of the Company and its subsidiaries, prepared in accordance with Accounting Standard 21 prescribed by The Institute of Chartered Accountants of India, forms part of the Annual Report and Accounts.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT:

Managements Discussion and Analysis Report for the year under review, as stipulated under clause 49 of the Listing Agreement with the Stock Exchanges in India, is presented in a separate section forming part of the Annual Report.

CEO/CCO CERTIFICATION:

As required under Clause 49 of the Listing Agreement, the CEO/CCO certification is attached with the annual report.

DIRECTORS RESPONSIBILITY STATEMENT:

Pursuant to section 217 (2AA) of the Companies Act, 1956 the Board of Directors hereby confirms that:

i. In the preparation of the annual accounts of the Company for the year ended 31st March, 2010 the applicable Accounting Standards had been followed and there are no departures.

ii. Accounting policies have been selected and applied consistently and judgments and estimates made that are reasonable and prudent so as to give true and fair view of the state of affairs of the Company at the end of the financial year and of the profit of the Company for that period.

iii. Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of this act for safeguarding the assets of the Company and detecting fraud and other irregularities.

iv. Annual accounts for the year ended 31 st March, 2010 have been prepared on a going concern basis.

ACKNOWLEDGEMENT:

Your Directors would like to express their appreciation for assistance and co-operation received from the financial institutions, banks, Government authorities, customers, vendors and members during the year under review. Your Directors also wish to place on record their deep sense of appreciation for the committed services by the executives, staff and workers of the Company.

For and on behalf of theBoard

(Manish Nuwal) Place: Nagpur Director Date : May 24.2010

 
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