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Directors Report of Borosil Glass Works Ltd.

Mar 31, 2017

To

The Members of

BOROSIL GLASS WORKS LIMITED

The Directors present their Fifty Fourth Annual Report and the Audited Financial Statement for the year ended March 31, 2017. FINANCIAL RESULTS

(Rs, in lacs)

Year ended 31.03.2017

Year ended 31.03.2016

Revenue from Operations

26,700

22,221

Other Income

3,498

3,540

Profit for the year before Finance cost, Depreciation and exceptional items

5,403

2,150

Less: Finance Cost

117

116

Less: Depreciation & Amortization Expenses

581

532

Profit before Exceptional Items

4,704

1,502

Less: Exceptional Item

(9,088)

-

Profit Before Tax

13,792

1,502

Less: Tax expenses

1,123

(55)

Profit for the year

12,669

1,557

Other Comprehensive Income

885

833

Total Comprehensive Income for the year

13,555

2,390

DIVIDEND

The Board of Directors recommends a dividend of Rs, 25/- per equity share of Rs, 10/- each for the year ended March 31, 2017 aggregating Rs, 5.78 crores.

REVIEW OF OPERATIONS

During FY17, your Company achieved Revenue from Operations of Rs, 267.0 crores as against Rs, 222.2 crores in FY16, registering a strong growth of 20.2%.

The Company’s Operational Profit Before Tax (PBT) grew by 67% from Rs, 22.6 crores in FY16 to Rs, 37.6 crores in FY17.

The Company earned Other Income of Rs, 35.0 crores during FY17 (mainly from investments) as compared to Rs, 35.4 crores in FY16.

The Company recorded a Profit Before Tax of Rs, 47.0 crores (before exceptional item) as compared to Rs, 15.0 crores in FY16, a growth of 213%. During FY17 the Company made a one-time exceptional net gain of Rs, 90.9 crores from the acquisition of a piece of land from the company by Municipal Corporation of Greater Mumbai (MCGM).

Profit After Tax (PAT) recorded a growth of 130% from Rs, 15.6 crores in FY16 to Rs, 35.8 crores in FY17. After including the one-time gain in FY17, the growth in PAT was 714%.

A detailed Management Discussion and Analysis, which inter-alia covers the following, forms part of the Annual Report.

- Industry Structure and Development

- Risks and Concerns

- Adequacy of Internal Controls

- Analysis of Segment Wise Performance

- Scheme of Amalgamation

- Other Corporate Developments

- Outlook

- Material Development in Human Resources and Industrial Relations including number of people employed

MANAGEMENT DISCUSSION AND ANALYSIS

This discussion covers the financial results and other developments during April, 2016 - March, 2017 in respect of the Consolidated Results of Borosil comprising its Scientific & Industrial Products Division (SIP) and its Consumer Products Division (CPD). These include the financials of Borosil Glass Works Limited, Hopewell Tableware Private Limited (100% subsidiary), Klasspack Private Limited (60.3% subsidiary), Borosil Afrasia FZE (100% subsidiary) and Fennel Investment and Finance Private Limited (an associate company). The consolidated entity has been referred to hereinafter as “Company” or “Borosil”. A brief overview of the business of Gujarat Borosil Limited is provided separately.

The financials of the company have been prepared in accordance with Indian Accounting Standards (IND ASs). The financials of FY16 have been restated accordingly wherever necessary.

Some statements in this discussion pertaining to projections, estimates, expectations or outlook may be forward looking. Actual results may however differ materially from those stated on account of various factors such as changes in government regulations, tax regimes, economic developments, exchange rate and interest rate movements, impact of competing products and their pricing, product demand and supply constraints within India and other countries where the Company conducts business. Estimates made with regard to market size of various segments and their respective rates of growth are internal estimates made by the management.

INDUSTRY STRUCTURE AND DEVELOPMENT

Notwithstanding sluggish global growth in recent years, the Indian economy has shown robust growth. It continues to be one of the fastest growing large economies. A large domestic market and sector diversity helps to insulate the country from external shocks. Both the World Bank and the International Monetary Fund have projected growth rates of over 7.0% in India’s GDP over each of the next three years. India could thus be considered one of the engines for global growth. On a US$ 2.3 trillion base, India would add US$ 600-900 billion over the next 5 years even with a modest 5% - 7% growth rate.

Prime Minister Narendra Modi’s, Bharatiya Janata Party (BJP) won a sweeping mandate in the last general elections in 2014 resulting in a single party rule at the central government as opposed to coalition rule for the first time in 30 years. This has given this administration the opportunity to govern without the drag of coalition politics. It is seen as pro-business and pro-reform. A stable and forward looking government is expected to drive several positive economic changes. Current and fiscal deficits have been lowered and inflation has been moderate this year aided by better agricultural output as well as lower international crude oil prices. Prevalence of high inflation had prevented India from softening interest rates. Interest rates had reached a high of 14.5% during CY13. These have since declined to about 11% and are expected to come down further to about 10% giving a boost to investment demand.

Public and private investment driven GDP growth is expected to see a rise in the per capital income. On a Purchasing Power Parity (PPP) basis its per capital income is about $ 6000 per year. Rising income is leading to an upward mobility with about 150 million expected to be added to the middle class by 2025 creating a large consumer market in India (Source: Boston Consulting Group). India has the largest youth population with about 356 million between 10-24 years of age. It is expected that 64% of the population will be working age by 2021 giving India the advantage of a demographic dividend. The reduced expenditure on dependents will increase the ability to save as well as enable individuals to spend more on discretionary consumption, education, entertainment with a wider variety and higher value of purchases. India is seeing a rapid trend in urbanization. Its urban population is expected to increase by about 300 million over the next 30 years. India has the second largest base of internet users and an explosion in mobile phone penetration has brought in large numbers of mobile first internet users. This is leading to a rapidly growing trend of online consumption.

From the financial year 2017-18, India is expected to witness the benefit of two very significant economic policy developments. A constitutional amendment has paved the way for the long awaited and transformational Goods and Services Tax (GST). It is expected to be implemented by July, 2017. It will create a common Indian market leading to a simplification of taxation, eliminate the cascading effect of multiplicity of taxation and widen the tax base through improved compliance. On November 8, 2016 the government “demonetized” the two largest denomination currency notes. This 86% of the currency in circulation ceased to be legal tender. These were to be deposited in banks by December 30, 2016. The aim was to curb corruption, counterfeiting and accumulation of “black money” generated from income that had not been declared to tax authorities. While this led to short term inconvenience and hardship, demonetization has the long term potential of reducing corruption, greater digitization of the economy and greater formalization of the economy.

Borosil Glass Works Limited conducts its operations in two business segments, namely its Scientific & Industrial Products Division (SIP) and its Consumer Products Division (CPD).

SIP caters to the needs of the Pharmaceutical, Research and Development, Education and Healthcare segments of the market. These industries are seeing a rapid move towards automation. This shift is improving productivity multifold and exponentially increasing the volumes of tests and analyses being conducted. New methodologies are being developed for sample preparation enabling multiple analyses. Consequently, there is a large market emerging for new equipment and other products. Traditionally the Company used to market glassware including a wide variety of scientific, industrial and pharmaceutical glass items sourced both from international and domestic markets. Changing with market needs, it has now begun to see itself evolve from a glassware manufacturer to a solutions provider to its customers for their laboratory and product needs. A beginning has been made through the marketing of HPLC vials, Liquid Handling Systems as well as Bench Top Equipment under the brand Labquest by Borosil.

CPD has been marketing microwaveable glassware products to consumers. There is a definite trend in terms of increased disposable income of households, more nuclear families and changes in consumer lifestyle. Kitchen designs are improving (even as they might get smaller) and consumers are entertaining at home more often. This gives rise to the need for kitchen and serving products that perform more efficiently and are at the same time more elegant. Borosil products seek to empower their consumers with just that, in accordance with our tag-line “performs beautifully”. With a rise in health consciousness in the country, there is a gradual shift from storage of food items in plastic to glass containers. The Company now markets Larah by Borosil, a range of opal tableware products, a glass storage range and has introduced a range of kitchen appliances to exploit these opportunities.

RISKS AND CONCERNS

(a) Macro Economic Factors: In situations of economic constraints, items which are in the nature of discretionary spending are the first to be curtailed. Factors such as low GDP growth and high food inflation can result in postponement of purchase or down-trading from premium to mass market products.

(b) Changing Customer Preferences: Demand can be adversely impacted by a shift in customer and consumer preferences. The Company keeps a close watch on changing trends and identifies new product lines that it can offer its existing customers.

(c) Competition: With low entry barriers, there could be an increase in the number of competing brands. Counter campaigning and aggressive pricing by competitors (including e-commerce players buying sales through heavy discounting) have the potential of creating a disruption. China could be a source of low cost products in addition to grey market imports. The Company brand “BOROSIL” enjoys a first mover advantage and significant brand equity. Marketing investments to further strengthen the brand may mitigate the impact of aggressive competition.

(d) Growth of Online as a new channel: New brands are being launched online. With increased online penetration distributor relationships may no longer remain a critical success factor. The Company has listed its products on major e-tailor marketplaces and has also launched its own e-commerce portal www.myborosil.com.

(e) New Product Launches: New products may not find very favorable acceptance by consumers or may fail to achieve sales targets. The Company has a systematic outside-in infighting and new product development process which helps in increasing the chances of new product success.

(f) Acquisitions: Acquisitions entail deployment of capital and may increase the challenge of improving returns on investment, particularly in the short run. Integration of operations may take time thereby deferring benefits of synergies of unification. The Company contemplates acquisitions with a high strategic fit where it envisages a clear potential to derive synergistic benefits.

(g) Input Costs: Unexpected changes in commodity prices resulting from global demand and supply fluctuations as well as variations in the value of the Indian Rupee versus foreign currencies could lead to an increased cost base with a consequent impact on margins.

(h) Counterfeits: Counterfeits, pass-offs and lookalikes are a constant source of unfair competition for leadership brands.

(i) Volatility in Financial Markets: Investments in equity, debt and real estate markets are always subject to market fluctuation risks. The Company has reduced the size of its investment portfolio and is expected to park surplus funds primarily in safe, liquid assets.

Adequacy of Internal Financial Controls

The Company has adequate Internal Control Systems commensurate with its size and nature of business. Internal Audits are periodically conducted by an external firm of Chartered Accountants who monitor and evaluate the efficiency and adequacy of internal control systems in the Company, its compliance with operating systems, accounting procedures and policies at all locations of the Company. Based on the report of internal audit function, suitable corrective actions are taken and thereby controls are strengthened. These Internal Audit reports are reviewed by the Audit Committee.

Review of Operations - Consolidated for SIP and CPD

During FY17 Borosil achieved Revenue from Operations of Rs, 388.8 crores as against Rs, 234.7 crores, a strong growth of 66%. FY17 includes inorganic revenue of Rs, 121.8 crores. The organic growth during FY17 was a robust 20.2%.

During FY17 Borosil achieved an EBITDA of Rs, 43.2 crores, a growth of 60% over the previous year, in line with revenue growth. CPD made significant investments in brand building in FY17. EBITDA margin during the year was 11.5%. The Company expects to improve its EBITDA margin as it scales its operations in the coming years.

Other Income during FY17 was at Rs, 35.7 crore (mainly from investments) as compared to Rs, 35.1 crore in FY16.

Borosil’s Profit Before Tax (PBT) excluding profit from investments and exceptional items also grew by 3% from Rs, 24.0 crore in FY16 to Rs, 24.9 crore in FY17. During FY17, Borosil made a one-time exceptional gain of Rs, 90.9 crores from the acquisition of a piece of land from the company by Municipal Corporation of Greater Mumbai (MCGM).

Profit After Tax (PAT) recorded a growth of 37% from Rs, 23.5 crore in FY16 to Rs, 32.2 crore in FY17. After including the one-time gain (shown as exceptional item), the growth in PAT was 424%.

The Effective Tax Rate during FY17 was 6.5%. This was lower primarily on account of non-taxable earnings from the sale of longterm investments and Profit on Sale of Property, Plant and Equipments (shown as exceptional item).

ANALYSIS OF SEGMENT WISE PERFORMANCE

Scientific & Industrial Products Division (SIP)

Over the years, Borosil’s SIP division has established leadership in theRs,220 crore lab glassware segment (internal estimates) with nearly 60% market share. The Company’s client list includes most well-known pharmaceutical players in the country, apart from government laboratories, microbiology, biotechnology and food & soil testing organizations and institutions of higher education. Its large network of customers ensures that the company has virtually no client concentration risk. The nature of business requires servicing clients with a very large range of SKUs (the company has a range of over 2000 SKUs). Given low unit price of each item and being a rather small proportion of the consumables budget of pharmaceutical labs, clients are reluctant to have multiple supplier brands. Borosil enjoys an incumbent’s advantage with these customers. Moreover, the wide range of SKUs is not easy for a newcomer to offer as customers often demand immediate delivery with little or no demand forecasts. The Company has developed a strong sales team that keeps in touch with its customers, the scientists and technicians in the laboratories, to promote its products, take orders, assist with usage procedures and understand new needs. This reinforces Borosil’s branding and increases stickiness for this low-value but critical range of items in laboratories across the country.

As part of its strategy to market more products to existing customers, the Company introduced LabQuest, its brand of lab instrumentation, during the previous year. A significant portion of the approximatelyRs,150 crore market (growing at ~8% to 10%) is currently serviced by expensive imports. Borosil’s SIP has a strong team of over 50 sales persons who are trained to talk to customers about product and secure periodic contracts for Borosil lab glass as well as to discuss and introduce new products. The team has been able to generate trials and interest in LabQuest products such as Micro Centrifuges, Shakers and Magnetic Stirrers. Many new products will be introduced over the next few years as we understand our customers’ instrumentation needs better. While the assembly of these instrumentation products is outsourced, Borosil uses its technical expertise in assisting with product design.

The Company has begun to build an additional avenue for growth through exports of its lab glassware products. It intends to market the Borosil range in The Middle East, Africa and South East Asia. These markets do not have dominant local brands as yet and Borosil benefits from a favorable India-based cost structure. With Indian pharmaceutical companies expanding operations in these geographies, lab personnel from India are expected to prefer using the brand that they are familiar with. As a result of this focus, export revenues for the SIP division have grown from Rs, 1.4 crores in FY13 to Rs, 9.2 crores in FY17.

Acquisition of 60.3% stake in Klasspack

On July 29, 2016, the Company acquired 60.3% Equity Shares of Klasspack Private Limited a Nashik based manufacturer and marketer of Glass Ampoules and Tubular Glass Vials. Hitherto Borosil was marketing lab glassware to pharmaceutical companies for their research lab and quality control lab needs. With the addition of the Klasspack range to its portfolio, the Company can now service the product manufacturing glass packaging needs of their customers. With Borosil’s technological expertise in specialty glass production and Klasspack’s experience in world-class ampoule and tubular glass production, the Company’s pharmaceutical company customers get a high quality choice for sourcing their glass packaging needs.

During FY16 Klasspack had achieved a turnover of about Rs, 28 crore. The industry is quite fragmented and Klasspack is one of the leading players. It is the #2 player in the estimated Rs, 500 crore market for Glass Ampoules and Tubular Glass Vials. Klasspack provides Borosil’s pharmaceutical customers a credible alternative supplier. Its existing relationship with several pharmaceutical manufacturers helps the Company gain access to these customers and the equity of Borosil facilitates an evaluation opportunity. Borosil plans to invest to upgrade Klasspack’s production facility to world class standards with clean rooms, automatic manufacturing and camera inspection systems. Given the long lead times required to pass the stringent quality specifications to become an approved supplier there is a significant barrier to entry for future players. The Company has commenced the registering process with a number of potential customers. The approval cycles could take between 6 months to 18 months.

During FY17, the SIP division achieved Net Revenue of Rs, 136.6 crore, a growth of 14.7% over the previous year. Revenue from the international business was about Rs, 9.2 crore. The net revenue from Klasspack, an acquisition made in July 2016, during FY17 was about Rs, 22.6 crore.

Consumer Products Division (CPD)

Borosil, India’s most well-known and trusted brand in microwaveable kitchenware, has evolved in its products offering over the past few years. In the traditional microwaveable kitchenware segment, Borosil maintains a stronghold on the estimated Rs, 100 crore segment. It commands a 60% national market share (internal estimate). An established network of over 10,000 retail outlets as well as presence through key Modern Retail stores gives this homemakers’ favorite brand a nationwide reach.

The modern homemaker is looking for convenience in the kitchen and is also more conscious about how she presents / serves meals at home. This is leading to a strong tail wind in the categories of storage, tableware and kitchen appliances. These products also have everyday use as opposed to the occasional use of microwaveable glass kitchenware. The company has introduced a range of products that cover the entire process of cooking and serving that empower its consumers to perform more efficiently and present more beautifully.

The kitchen storage market is estimated to be Rs, 700 crore (organized only) and growing between 15% and 20% annually. This is currently dominated by steel and plastics. Steel suffers from being aesthetically inferior and being opaque is less convenient to use. Plastics are light and durable, but there is a growing awareness about the hazards of using plastics for storage of foods and worse to microwave in it. Glass inert property makes it safe. It can be aesthetically designed and containers can be used for storage, be microwaved, easily cleaned and look as good as new over long periods of time as it does not stain with Indian spices. Glass storage products can be designed without being unduly heavy. The company has introduced a range of storage products and has received a good response. These include lunch boxes that have made it very convenient for office goers to microwave and eat their meals at office. Glass jars with a vacuum sealing function are helping to keep foods fresh on the kitchen shelves in consumers’ homes. Borosil’s strategy is to create a shift towards adopting glass for storage through building awareness about the advantages of glass.

Acquisition of Hopewell Tableware Pvt Ltd (“Larah”)

In January 2016, the Company acquired 100% share in Hopewell Tableware Pvt Ltd, owners of the brand Larah. With Larah the Company has gained participation in the fast growth Rs, 300 crore opal glass market. The modern homemaker is looking for elegantly designed and fashionable products that can be used frequently (daily use) without fear of damage. Larah offers a light, strong and chip resistant product range that caters to this consumer need. Additionally, the products are bone-ash free, making them vegetarian friendly.

Hitherto the category has been dominated by a single player, La Opala. Borosil sees an opportunity to invest in and grow Larah into a strong brand of choice for the consumer. It has launched an advertising campaign which highlights the beauty and utility of Larah dinnerware. The tag line of this campaign is “Khaane ko banaaye khaas”.

During FY16, Larah had achieved a turnover of about Rs, 55 crore. The advertising campaign together with leveraging the company’s distribution reach of ~10,000 retailers and relationships with large format stores has gave Larah a fillip during FY17 with sales reaching Rs, 99.4 crore.

The market for kitchen appliances is estimated at Rs, 9,000 crore and growing at about 10% each year. Competitive intensity in the category is also high. The company would thus be selective in introducing unique and differentiated products. It expects to leverage its kitchenware equity to help it to participate in the growth of the category, without having to play out an aggressive share gain strategy. In order to de-risk its strategy the company will use third party manufacturers in the short term to produce the products under Borosil’s brand.

Sales Channels

Borosil has established a strong national distribution network for both its SIP and CPD divisions. The Company sells products to about 200 distributors who in turn service about 10,000 retailers. The Company’s products are available in all major Modern Trade store chains. Sales through Modern Trade comprise about 20% of the consumer products sales. The Canteen Stores Department (CSD) which is a channel for households of the armed forces is a customer. With e-commerce as a channel gaining momentum, the Company markets its products through marketplaces such as Amazon as well as its own e-commerce site, www.myborosil.com

Supply Chain

In the SIP division, the Company sources its lab glassware products from Vyline Glass Works Ltd. (a promoter held company), international companies and other domestic third parties. The SIP division is run as a profit center and its management is free to procure products from Vyline or anywhere else in the world. The instrumentation range under the brand LabQuest is manufactured through third parties. The pharma packaging range, under the brand Klasspack is produced at Klasspack’s own factory at Nashik.

In the CPD division, the microwaveable glass products are sourced through third parties, including through imports. Some of the products (comprising glass tumblers, decorative glass products etc.) are procured from Vyline. Similar to the SIP division, this is done at arm’s length pricing and Vyline competes with other third party suppliers. The Larah range of opal-ware products are manufactured at the facilities of Hopewell at Jaipur.

The Company has proposed a scheme of amalgamation. Under the scheme it is envisaged that Fennel Investment and Finance Pvt. Ltd., Vyline Glass Works Ltd and Hopewell Tableware Pvt Ltd will be merged into Borosil Glass Works Ltd.

Klasspack has adequate manufacturing capacity to handle growth in the near to medium term. It currently operates on a single shift. Moreover, a part of the consideration paid by the company to acquire 60.3% stake has been by way of a primary infusion to carry out balancing of manufacturing lines and fund working capital.

The Hopewell facility can currently service approximatelyRs,100 crore of sales. The Company is making investments to expand capacity and modernize the plant to improve productivity. An investment of about Rs, 60 crore is planned which would enable the plant to increase its output to about Rs, 150 crore. Simultaneously, this investment will improve the quality of final product and enhanced yields are expected to help in improving margins.

The company plans to invest in a new warehouse (approximately Rs, 30 crores). This is expected to improve freight efficiencies for the CPD division by combining dispatches of the Borosil range and the Larah by Borosil range and thus creating full truck-loads. These efficiencies in Larah manufacturing and in freight are likely to get implemented by the fourth quarter of FY18.

Operating Margins (EBITDA)

The EBITDA margin during FY17 was 11.5%. This was achieved after absorbing stepped up its advertising and sales promotion expenses during the year. The ASP to Sales stood at 6.4%. Over the next two years the company expects to deliver an expansion in the EBITDA margin. This is likely to be achieved with increasing scale wherein fixed overheads and marketing expenses do not increase at the same pace as revenue. In addition, the Company is upgrading its manufacturing facility for Larah which will lead to efficiency and yield improvements. Investment is a new warehouse will also result in optimization of freights. A proposed scheme of amalgamation (discussed in a later section) will also lead to EBITDA from the Vyline business getting added to the Company’s margins. Over the next two to three years, the Company expects to improve its EBITDA to about 15% to 20%.

(These operating margins are stated after excluding expenses which are directly resulting from the treasury related activities of the Company. A direct comparison with the profit and loss statement of the Company is thus not possible).

Capital Employed

As on March 31, 2017, the Company had operating capital employed ofRs,300 crore (as compared toRs,230 crore on March 31, 2016). This excludes capital employed in non-core assets and treasury related investments made by the Company and its investment in Preference Shares of Gujarat Borosil Limited. Based on the above, the Company turned its capital employed 1.3X times during FY17.

In the SIP business the Company strategically holds a higher level of inventory. This is to ensure that its regional warehouses maintain stocks that enable Borosil to service its customers’ requirements within 24 hours. This service level differentiates Borosil from its competitors. Moreover, the cost of holding inventory is lower than the cost of losing sale.

As of March 31, 2017, the Company had Net Fixed Assets of Rs, 219 crores. As mentioned in the section on Supply Chain, the company plans to invest Rs, 90 crores in enhancing capacity of opal-ware and building a new warehouse. This investment is likely to take care of the Company’s near to middle term fixed assets requirements.

The Company has decided to release capital from non-core assets. This is in line with the Company’s evolving new thinking on capital allocation. During the year FY17, the Municipal Corporation of Greater Mumbai (MCGM) acquired a piece of land from the Company for which it received a compensation of Rs, 90.9 crore. As of March 31, 2017, the Company has non-core fixed assets of Rs, 62.2 crore. The Company intends to dispose these assets (primarily real estate) as soon as it can receive appropriately priced valid offers.

Investments / Surplus / Other Income

During FY17, the Company recorded other income of Rs, 35.7 crore as compared to Rs, 35.1 crore during FY16. The Company utilized part of its cash surplus to make a buyback of its shares and acquire Hopewell in Q4FY16. In addition it acquired 60.3% in Klasspack in July, 2016. In December, 2016, the Company realized Rs, 90.9 crore from the acquisition of a real estate property from it by MCGM. As of March 31, 2017 the Company had surplus funds of Rs, 210 crore. These are invested in financial assets such as fixed income mutual funds, equity mutual funds and real estate funds.

In the past the Company believed that it would not require its surplus funds in the near to medium term and had hence invested these monies in a mix of debt and equity funds with the objective of maintaining the purchasing power of the funds (earn a return at least equal to inflation). Given the Company’s growth plans, including through the inorganic route, the Company intends to retain its war-chest of Rs, 210 crore. It will actively look for opportunities to unwind its positions in equity funds and real estate funds and maintain all surplus funds primarily in fixed income mutual funds.

SHARE CAPITAL

The Paid-up Capital of the Company is Rs, 2,31,00,000/- and Authorized Capital of the Company is Rs, 12,00,00,000/-.

Discussion on Financial Performance with respect to operational performance

Since the Company is debt free, the overall financial performance was in line with the operational performance, except that, the Company has income from its investible funds.

Scheme of Amalgamation

In Q3FY17 the board of the company approved a scheme of amalgamation to transfer all the assets and liabilities of Hopewell Tableware Pvt Ltd (HTPL), Fennel Investment and Finance Pvt Ltd (FIFPL) and Vyline Glass Works Ltd (VGWL) into Borosil Glass Works Ltd (BGWL). HTPL engaged in the business of manufacturing and marketing opal tableware items, is a wholly owned subsidiary of BGWL so no shares will be issued to the shareholders of HTPL under the scheme.

FIFPL is an associate company of BGWL and registered as a Non-Banking Financial Institution. It is held by BGWL and the promoters of BGWL. Shareholders of FIFPL will be issued 10 equity shares of BGWL for every 207 equity shares of FIFPL held.

VGWL, held by the promoters of BGWL, is in the business of manufacturing glass and glass products which it supplies primarily to BGWL. Shareholders of VGWL will be issued 4 equity shares of BGWL for every 65 equity shares of VGWL held.

The share exchange ratio was arrived at as per a valuation report and an addendum thereto by SSPA & Co, Chartered Accountant. A fairness opinion including an addendum was provided by M/s Keynote Corporate Services Ltd.

The amalgamation will eliminate cross holdings among group companies and simplify the group structure. A key rationale is the reduction in related party transactions in the current operations. The merger of HTPL, FIFPL and VGWL would lead to consolidation of the entities and business operations of HTPL and VGWL with BGWL which will result in reduction in costs for administration, legal and compliance and lead to greater general administrative efficiency and optimal utilization of various resources.

The scheme of amalgamation is subject to various requisite approvals including that of shareholders, creditors, Securities and Exchange Board of India, BSE Limited and the jurisdictional High Court. The scheme would become effective thereafter and the Company expects this to be accomplished during H2FY18. Consequent to the scheme becoming effective, BGWL’s issued and paid up equity shares will increase from 2.31 million to 2.51 million leading to a dilution of about 9%. The promoter shareholding in BGWL will increase from 74.28% to 76.28%.

After the scheme of amalgamation becomes effective, the profits and losses of Vyline will get consolidated in BGWL. Moreover, Gujarat Borosil Ltd., a manufacturer and marketer of solar glass which is held 25.25% by BGWL will become a 58.38% subsidiary of BGWL. Gujarat Borosil Ltd. is listed on BSE and had a market capitalization ofRs,553 crore at the close of trading on March 31, 2017.

Gujarat Borosil Ltd

Gujarat Borosil is the only manufacturer of solar glass in India. During the year FY17, the company recorded a turnover ofRs,188 crore. There was no growth over the previous year as the Company was running at full capacity. The EBITDA margin of the company during FY17 was 25.3%, up from 19.1% in FY16. Profit After Tax during FY17 wasRs,14.1 crore.

The company has a strong R&D team and a state of the art manufacturing facility located at Bharuch. The company has achieved a high degree of innovation to drive down total cost of ownership for its end customers. Its glass ensures high light transmission, with anti-reflective coating to increase efficiency. It has low iron content and the company has also developed the world’s first antimony free solar glass. Gujarat Borosil faces competition from Chinese suppliers. Given the government subsidies that Chinese companies receive they enjoy the advantage of an uneven playing field. Gujarat Borosil has a low cost of production and notwithstanding subsidies for Chinese suppliers is able to sell its product at a modest premium to the competition. The company believes that its customers would always maintain an alternative source of supply from an Indian company.

India’s currently has about 12 GW of solar energy installations. The Government of India is providing a big impetus to solar energy and has set an objective of 100 GW from solar by 2022. Gujarat Borosil has a capacity to service about 1 GW per year. The company has thus drawn up a plan to increase its capacity to service 2.3 GW per year. The company is examining a mix of various options to finance this expansion.

Other Corporate Developments

At its meeting held on May 13, 2017, the Board of Directors approved a proposal to sub-divide (split) the shares of the Company from a face value of Rs, 10/- per shares to 10 shares of a face value of Rs, 1/- per share. The approval is subject to the approval of the shareholders of the company. A lower face value per share is expected to bring down the quoted price per share on the stock exchange and facilitate increased access to the company’s shares to a larger number of retail investors. This may also provide additional liquidity to the company’s shares on the stock exchange.

People are the Company’s critical resource. In order to attract and retain the best talent relevant to the company’s plans and keep them highly motivated, it practices and continues to evolve best Human Resources strategies. The company has an incentive plan that rewards superior performance. In order to align senior management incentives with long term shareholder value objectives, the Board of Directors, at its meeting held on May 13, 2017 gave its go ahead to the company to develop an Employee Stock Option Plan (ESOP). The plan would be implemented after an approval from the shareholders of the Company.

Outlook

In the SIP business, the company expects to maintain its dominant market leadership in the lab glassware segment in India. The market is expected to grow at 8% to 10%. The company has also begun to grow an international franchise and will focus on The Middle East, Africa and South East Asia. Two new avenues of growth are being built through the introduction of LabQuest for lab instrumentation and an entry into the pharma packaging segment with the acquisition of 60.3% equity stake in Klasspack. Overall the SIP division is expected to grow 12% to 15% in the medium term.

In the CPD business the company expects to maintain its share in the kitchen microwaveable glass segment. The company expects a significant portion of its growth to come from the glass storage segment by tapping into conversions from steel and plastic storage containers to glass and from opalware dining products. In opalware the company will build the equity of its brand Larah and participate in market growth as well as improve market share. In the medium to long term, the company will experiment with making introductions of innovative products in the kitchen appliances segment.

The company has a strong balance sheet and surplus cash on hand. It will leverage this to look for inorganic opportunities with a strategic fit.

In the solar glass business, the company expects to ride the strong tail wind in the solar power industry. The company’s current capacity and planned expansion will service a very small portion of the Government of India’s targeted installations. As the only domestic supplier of solar glass, the company expects to continue to see robust growth.

Material Development in Human Resources, Industrial Relations and number of people employed

The Company believes that talent and culture can be nurtured into a source of competitive advantage. The Company has initiated several steps to build a strong culture and institution.

The Company has prepared and published its Vision Statement & Corporate Values. The Company has developed & published an overall organizational strategy to achieve growth aspirations of the organization for the next three years, through deliberation by a Steering Committee comprising the Managing Director and Functional heads.

Based on its vision and strategic goals, the Company has evolved the desired set of deliverables & competencies for all employees. Employee development plans are being aligned to the defined competencies in order to achieve desired business goals. Similarly, all new recruitments will also be made on the basis of this set of competencies.

The Company is building a performance oriented culture with merit based rewards and recognition.

The Company, as a part of its program for upgrading skills of its employees, arranges various training programs for executives at various levels including functional and soft skills training. During the year, the Company has arranged a number of development initiatives which include:

1. “Leadership Development Program” for Consumer Products Division.

2. Workshop on “MS Excel with an accounting perspective” for Support Division.

The Company has also devised various employee benefit policies which are revised from time to time. In order to maintain a work life balance and to encourage team interaction beyond work, the Company organizes various events including an event known as ‘Unwind’ on a bi-monthly basis and various other employee engagement initiatives driven by team known as “Umang”. The Company has also put in place a Code of Business Ethics.

The Company had 217 office staff / managerial personnel employed as on March 31, 2017 in various offices/locations. In addition, there were 10 retainers in different fields.

SUBSIDIARY & ASSOCIATES

The Company has two wholly owned subsidiaries namely:

Borosil Afrasia FZE (Free Zone Establishment) in Jebel Ali Free Zone situated in Dubai in United Arab Emirates (UAE).The said FZE is engaged in the business of marketing the Company’s products in the Middle East and African markets; and Hopewell Tableware Private Limited engaged in the business of manufacture and marketing of opal glassware with a factory in Jaipur, Rajasthan.

Further, Borosil Afrasia FZE has incorporated a Limited Liability Company namely Borosil Afrasia Middle East Trading LLC. As per UAE law, foreign entities are entitled to hold a maximum of 49% shares in an LLC, accordingly, Borosil Afrasia FZE holds 49% shares in the said LLC.

During the year, the Company acquired 60.3% shares in Klass Pack Private Limited (Klasspack) and with effect from July 29, 2016 it became a subsidiary of the Company. Klasspack is engaged in the manufacture and supply of pharmaceutical vials and ampoules to the Pharmaceutical industry for over 15 years and has its manufacturing facilities at Nashik, Maharashtra.

The Company has formulated a Policy on material subsidiaries of the Company. The said policy is available on the website of the Company at http://www.borosil.com/doc_files/Policy%20for%20Determining%20Material%20Subsidiaries.pdf

The Company has two associate companies namely Gujarat Borosil Limited and Fennel Investment and Finance Private Limited by virtue of its holding of more than 20% of the respective equity share capital of those companies.

CONSOLIDATED FINANCIAL STATEMENTS

As per Section 129(3) of Companies Act, 2013, the Company has prepared a consolidated financial statement of the Company, along with Borosil Afrasia FZE (Subsidiary), Hopewell Tableware Private Limited (Subsidiary), Klasspack Private Limited (Subsidiary), Gujarat Borosil Limited (in which the Company exercises control more than 50% of the voting rights as per Indian Accounting

Standard (Ind- AS) 110) and Fennel Investment and Finance Private Limited (associate company). Apart from standalone annual accounts, consolidated accounts, Statement containing salient features on financial statements of subsidiary in Form AOC 1, the individual standalone financial statement of all subsidiary/associate as mentioned above will be uploaded on the website of the Company as per Section 136 of the Companies Act, 2013.

The Company will provide a copy of separate audited financial statements in respect of its subsidiaries to any shareholder of the Company who asks for it and the said annual accounts will also be kept open for inspection at the Registered Office of the Company and that of the subsidiary company.

The Consolidated Financial Statements of the Company are prepared in accordance with relevant Indian Accounting Standards (Ind-AS) viz. Ind-AS 110,117,112 and 28 issued by the Institute of Chartered Accountants of India, forms part of this Annual Report.

BOARD OF DIRECTORS, ITS MEETINGS, EVALUATION ETC.

Board Meetings

The Board of Directors of the Company met five times during the year on May 30, 2016, August 11, 2016, November 25, 2016, February 09, 2017 and March 07, 2017.

Independent Directors

The Company has four Independent Directors namely Mr. U.K. Mukhopadhyay, Mr. Naveen Kumar Kshatriya, Mr. S. Bagai and Mrs. Anupa R. Sahney, all of them having tenure up to March 31, 2019.

Declaration by Independent Directors

The Company has received declaration of independence in terms of Section 149(7) of Companies Act, 2013 from the above mentioned Independent Directors.

Company’s Policy on Directors’ Appointment and Remuneration etc.

Under Section 178 of the Companies Act, 2013, the Company has prepared a policy on Director’s appointment and Remuneration. The Company has also laid down criteria for determining qualifications, positive attributes and independence of a Director. The Remuneration policy is attached herewith as an ‘Annexure A’ to this report.

Familiarization Programme for Independent Directors

A Familiarization programme was prepared by the Company about roles, rights and responsibilities of Independent Directors in the Company, nature of industry in which the Company operates business model of the Company, etc., which was presented to Independent Directors on February 09, 2017.

The details of the above programme are available on website of the Company at http://www.borosil.com/doc_files/Familiarization%20 Programme%20for%20Independent%20Director-2017.pdf

Formal Annual Evaluation

The Formal Annual Evaluation has been made as follows:

1. The Company has laid down evaluation criteria separately for the Board, Independent Directors, Directors other than Independent Directors and various committees of the Board. The criteria for evaluation of Directors (including the Chairman) included parameters such as willingness and commitment to fulfill duties, high level of professional ethics, contribution during meetings and timely disclosure of all the notice/details required under various provisions of laws. Based on such criteria, the evaluation was done in a structured manner through peer consultation & discussion.

2. Evaluation of the Board was made at a Separate Meeting of Independent Directors held under Chairmanship of Mr. U.K. Mukhopadhyay, Lead Independent Director (without attendance of Non-Independent Director and members of the management) on March 07, 2017.

3. The performance evaluation of following committees namely:

1. Audit Committee

2. Nomination and Remuneration Committee

3. Corporate Social Responsibility Committee

4. Share Transfer Committee

was done by the Board of Directors at its meeting held on March 07, 2017. However, evaluation of Stakeholders Relationship Committee was done by the Board of Directors at its meeting held on May 13, 2017.

4. Performance evaluation of Non-Independent Directors namely Mr. B. L. Kheruka, Mr. P.K. Kheruka, Mr. Shreevar Kheruka and Mr. V. Ramaswami was done at a Separate Meeting of Independent Directors.

5. Evaluation of Independent Directors namely Mr. U. K. Mukhopadhyay, Mr. Naveen Kumar Kshatriya, Mr. S. Bagai and Mrs. Anupa R. Sahney was done (excluding the Director who was evaluated) by the Board of Directors’ of the Company at its meeting held on March 07, 2017.

6. In addition, the Nomination and Remuneration Committee has carried out evaluation of every Director’s performance at its meeting held on March 07, 2017 as required under Section 178 (2) of Companies Act, 2013.

7. The Directors expressed their satisfaction with the evaluation process. Performance evaluation of the Board, its various committees and directors including Independent Directors was found satisfactory.

RE-APPOINTMENT OF DIRECTOR

As per the provisions of the Companies Act, 2013 and Articles of Association of the Company, Mr. B. L. Kheruka (DIN 00016861) retires by rotation and, being eligible, offers himself for re-appointment.

Brief details of the Director being re-appointed have been incorporated in the Notice of Annual General Meeting.

There is no change in the composition of the Board of Directors during the year under review.

KEY MANAGERIAL PERSONNEL

There is no change in the Key Managerial Personnel of the Company.

Mr. Shreevar Kheruka is the Managing Director and Chief Executive Officer, Mr. Swadhin Padia is the Chief Financial Officer and Ms. Gita Yadav is the Company Secretary & Compliance Officer of the Company.

CORPORATE GOVERNANCE REPORT

A Report on Corporate Governance along with the Compliance Certificate from the Auditors is annexed hereto and forms part of this Report.

The Board of Directors of the Company has evolved and adopted a Code of Conduct and posted the same on the Company’s website, ‘www.borosil.com’. The Directors and senior management personnel have affirmed their compliance with the Code for the year ended March 31, 2017.

FIXED DEPOSITS

The Company has stopped accepting fresh fixed deposits since July, 2006.

There are no unclaimed deposits.

DEVELOPMENT AND IMPLENTATION OF RISK MANAGEMENT POLICY

The Company faces various risks in the form of financial risk, operational risks etc. The Company understands that it needs to survive these risks in the market and hence, has made a comprehensive policy on Risk Management.

RELATED PARTY TRANSACTIONS

The Company entered into various Related Party Transactions during the financial year which were in the ordinary course of business. The Company places before the Audit Committee all transactions which are foreseen and repetitive in nature on a quarterly basis. The Company had also obtained approval of shareholders in the previous year for such Related Party Transactions which exceeded the threshold limits as mentioned under the Companies (Meetings of the Board and its Powers) Rules, 2013 or which were material in nature with Vyline Glass Works Limited and Gujarat Borosil Limited.

The Company has formulated a policy on dealing with Related Party Transactions. This is available on the website of the Company at http:// www.borosil.com/doc_ files/Related%20Parties%20Transaction%20Policy.pdf

Particulars of Contracts or Arrangements entered into with Related Parties referred to in Section 188(1) of the Companies Act, 2013, in prescribed Form AOC-2 is attached as an ‘Annexure B’ to this Report.

The details of all the transactions with Related Parties are provided in the accompanying financial statements.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

As part of its initiatives under “Corporate Social Responsibility” (CSR), the Company has undertaken projects in the areas of Education, Health and protection of sites of historical importance, which were in accordance with Schedule VII of the Companies Act, 2013. The Company contributed:

1. Rs, 10,00,000/- to a project of Friends of Tribal Society for promoting education through ‘One Teacher School’ called ‘Ekal Vidyalaya’ for tribal children in rural areas.

2. Rs, 3,00,000/- to Samarth for its Lead India 2020 programme which imparts life skills, thinking skills, global skills, positive attitude with vision, mission & inculcating values among persons in the age group of 10 to 30 years, also known as “Aap Badho Desho Ko Badhao”.

3. Rs, 1,00,000/- to Shri Ram Krishna Cancer Hospital, Deoband, Uttar Pradesh for building construction and infrastructure of the hospital, purchasing equipment and accessories.

4. Rs, 2,00,000/- to Ramakrishna Mission, Khetri, Rajasthan for renovation of the historic ashrama building sanctified by Swami Vivekananda and to protect it from destruction.

5. Rs, 50,00,000/- to JSW Foundation to bear a part of running annual cost of Indian Institute of Sport, a brainchild of JSW group which is a training centre for supporting Indian athletes in Vijayanagar, Karnataka.

In terms of Section 135 of the Companies Act, 2013 and Rules made thereunder, the Company has constituted CSR committee comprising the following members:

1. Mr. B.L. Kheruka

2. Mr. Shreevar Kheruka

3. Mr. U.K. Mukhopadhyay

4. Mr. Naveen Kumar Kshatriya

out of which Mr. U.K. Mukhopadhyay and Mr. Naveen Kumar Kshatriya are Independent Directors.

a. The CSR Committee of the Board of Directors indicates the activities to be undertaken by the Company (within the framework of activities as specified in Schedule VII of the Act) during the particular year.

b. recommends to the Board the amount of expenditure to be incurred during the year under some of the activities covered in the Company’s CSR Policy.

c. monitors the said Policy.

d. ensures that the activities as included in CSR Policy of the Company are undertaken by it in a phased manner depending on the available opportunities.

COMPANY’S CSR POLICY

The Board of Directors of the Company has approved the CSR Policy as recommended by the CSR Committee. This has been uploaded on the Company’s website at http://www.borosil.com/doc_files/Corporate%20Social%20Responsibility.pdf

INITIATIVES TAKEN BY THE COMPANY DURING THE YEAR

The 2% of the net profits of the Company during the immediate three preceding financial years amounts toRs,73,12,000/-. The Company has contributed a sum of Rs, 66,00,000/- during the year. As such the Company could not contribute a sum of Rs, 7,12,000/-, as the Company was looking for genuine and socially useful opportunities, where the money could be fruitfully used. The Company will make every Endeavour to utilize its CSR expenditure budget during the current year.

The Company has jointly with Hopewell Tableware Private Limited (HTPL), wholly owned subsidiary and Gujarat Borosil Limited (GBL), a subsidiary of the Company constituted a Trust namely - ‘Borosil Foundation’ with the main objective of making CSR contributions by the Company, HTPL and GBL, from time to time. Further, the Company will contribute its future CSR contribution through the Borosil Foundation as and when said trust is fully operative.

An Annual Report on CSR activities in terms of Section 134 (3) (o) of the Companies Act, 2013 read with the Companies (Corporate Social Responsibility) Rules, 2014 is attached herewith as an ‘Annexure C’ to this Report.

EXTRACT OF ANNUAL RETURN

Extract of Annual Return in Form MGT 9 is attached as an ‘Annexure D’ to this Report.

VIGIL MECHANISM

The Company has Whistle Blower Policy to deal with instances of fraud and mismanagement.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

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.

AUDITORS’ REPORT

The Auditors’ Report for the year ended March 31, 2017 does not contain any qualification.

AUDITORS

M/s. Pathak H.D. & Associates, Chartered Accountants, were appointed as Statutory Auditors of your Company for a term of five years from the conclusion of the 53rd Annual General Meeting held on August 11, 2016 till the conclusion of the 58th Annual General Meeting, subject to the ratification of Members at each Annual General Meeting.

A written consent from them has been received along with a certificate that their appointment if made, shall be in accordance with the prescribed conditions and the said Auditors satisfy the criteria provided in Section 141 of the Companies Act, 2013.

The resolution seeking ratification of their appointment has been included in the Notice of Annual General Meeting.

COST RECORDS AND AUDIT

Under the Section 148 of the Companies Act, 2013, the Central Government has prescribed maintenance and audit of cost records vide the Companies (Cost Records and Audit) Rules, 2014 to such class of companies as mentioned in the Table appended to Rule 3 of the said Rules. CETA headings under which Company’s products are covered are not included. Hence, maintenance of cost records and cost audit provisions are not applicable to the Company as of now.

SECRETARIAL AUDIT

Secretarial Audit Report dated May 13, 2017 by Mr. Virendra Bhatt, Practising Company Secretary (CP no.124) is attached herewith as an ‘Annexure E’ to this Report. Secretarial Audit Report does not contain any qualification.

TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND

There was no amount transferrable to the Investor Education and Protection Fund (IEPF) established by the Central Government in compliance with Section 124 of Companies Act, 2013 during the financial year 2016-17.

However, there is an unpaid dividend for the financial year 2010-11 which is due to be transferred to IEPF on November 26, 2017, the last date for claiming the unpaid dividend is on or before October 26, 2017. The Company will transfer the amount on the due date.

DIRECTORS’ RESPONSIBILITY STATEMENT

Subject to disclosures in the Annual Accounts and also on the basis of the discussion with the Statutory Auditors of the Company from time to time, the Board of Directors state as under:

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

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

(c) that we had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(d) that we had prepared the annual accounts on a going concern basis;

(e) and that we, had laid down Internal Financial Controls to be followed by the Company and that such Internal Financial Controls are adequate and were operating effectively.

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

PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS

A statement on Particulars of Loans, Guarantees and Investments is attached as an ‘Annexure F’ to this Report read with note 8 and 13 to the financial statements.

EMPLOYEES’ SAFETY

The Company is continuously endeavoring to ensure safe working conditions for all its employees.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has in place a Policy for Prevention Prohibition and Redressal of Sexual Harassment at work place which is in line with the requirements of the Sexual Harassment of women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013 and Rules made there under. All employees (permanent, contractual, temporary and trainees) are covered under this Policy. The Company has constituted an Internal Complaint Committee for its Head Office and branch/sales offices under Section 4 of the captioned Act. No complaint has been filed before the said committee till date. The Company has filed an Annual Report with the concerned Authority in the matter.

DISCLOSURE UNDER RULE 5(1) OF THE COMPANIES (APPOINTMENT AND REMUNERATION OF MANAGERIAL PERSONEEL), RULES, 2014

The information required pursuant to Section 197 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel), Rules, 2014 in respect of employees of the Company and Directors is attached as an ‘Annexure G’.

PARTICULARS OF EMPLOYEES

Particulars of Employees as required under Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is attached as an ‘Annexure H’.

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

The Company is engaged in trading activity and it did not carry out any Research & Development activities nor introduced any new technology during the year. Hence, Rule 8 (3) of the Companies (Accounts) Rules, 2014 are not applicable with respect to those details.

Particulars with regard to foreign exchange earnings and outgo during the year are as under:

(Rs, in lacs)

Foreign exchange earnings

1,153.73

Foreign exchange outgo

3,270.99

ACKNOWLEDGEMENT

Your Directors record their appreciation for the co-operation received from the Employees, Customers and last but not least the shareholders for their unstinted support, during the year under review.

For and on behalf of the Board of Directors

B. L. Kheruka

Place : Mumbai Chairman

Date : May 13, 2017 DIN 00016861


Mar 31, 2015

Dear Members,

The Directors present their Fifty Second Annual Report and the Audited Financial Statements for the year ended March 31,2015. FINANCIAL RESULTS

(Rs. in lacs)

Year ended Year ended 31.03.2015 31.03.2014

Revenue from Operations 17,542 15,595

Other Income 6,600 4,076

Profit for the year before Finance cost, Depreci and exceptional item 7,348 5,023

Less: Finance Cost 25 50

Less: Depreciation & Amortisation Expenses 548 372

Profit before Exceptional Item 6,775 4,601

Less: Exceptional Item (NSEL write off) 422 435

Profit Before Tax 6,353 4,167

Less: Tax expenses 1,437 452

Profit for the year 4,916 3,715

Add: Balance as per last year 64,307 61,696

Amount available for Appropriation 69,223 65,411 Appropriations

Amount Transferred to General Reserve 500 400

Dividend on Equity Shares 751 601

Tax on above Dividend 153 102

Balance carried to Balance Sheet 67,819 64,307

DIVIDEND

The Board of Directors recommends a dividend of Rs. 25 /- per equity share for the year ended March 31,2015.

PERFORMANCE

Your Company has generated a business profit of Rs. 67.75 crores, (including profit of Rs. 26.91 crores from sale of fixed assets - net of expenses) (before tax and exceptional items) during the year under review. Hence, its business profit for the year is Rs. 40.84 crores as compared to Rs. 46.01 crores (before tax and exceptional items) in the previous year.

During the course of the year, the Company's operating profit grew from Rs. 13.43 crores to Rs. 17.80 crores.

The Company's efforts for organic as well as inorganic expansion both in India and abroad continues.

The Company has invested its investible funds of around Rs. 454 crores as on March 31,2015 as compared to Rs. 409 crores in the previous year in a mixture of Debt markets, Equity/Equity Linked Instruments, Bonds/Debentures, Convertible Preference Shares, Non-Convertible Redeemable Preference Shares, Real Estate, Opportunity based Funds, Real Estate Funds and Mutual Funds.

Scientific & Industrial Products Division (SIP)

The Financial Year 2014-15 has been a challenging year for SIP Division. The first six months of the year were relatively slow as far as business is concerned due to constraints in institutional funding basically consequent to formation of new Government. However, the demand from the industry especially pharmaceuticals was successfully converted to sales by the team which was able to register an overall growth of 17% during the year. New products groups have been received well by the Pharma Customers.

The Export team gained confidence in dealing with International clients which resulted in 44% growth over last year i.e. from Rs. 4.29 crores to Rs. 6.19 crores. The Company has been able to export to many new geographies. An international dealers meet was arranged in the month of November, 2014 which improved the perception of the International business houses towards the Company.

Consumer Products Division

The consumer products division has seen a growth of 10 % over the last financial year.

The Company's new range of products has been performing well. However, general market sentiment in the consumer sector has been depressed with the decline in footfalls in modern trade.

Apart from the product categories introduced by the Company in the previous years namely, Melamine dinnerware, Appliances and Home Decor, the Company also introduced more items namely, Glass container with lid under the sub brand Klip-n-store, Electric rice cooker as Digikook and Electric Kettles.

Exports of consumerware division during the year showed a marginal increase to Rs. 3.44 crores as compared to Rs. 3.20 crores in the previous year. The Company has made foray in the Middle East market through its subsidiary mentioned below. This apart, the Company, during the year explored new markets in U.S.A., Nepal and Singapore for its consumerware products as also looking for new export markets in Australia, Canada and Latin American countries, amongst others.

Exports

The overall exports of the Company during the year were Rs. 9.81 crores as compared to Rs. 7.49 crores during the previous year.

Investments

The Company has investments in various debt, equity and real estate instruments as per the Investment policy mandate approved by the Board. With the spurt in the equity market, the market value of equity components of the investment have gone up substantially during the year, although major portion of it remains unrealized and unbooked.

SHARE CAPITAL

The Paid up Capital of the Company is Rs. 3,00,60,000/- and Authorised Capital of the Company is Rs. 12,00,00,000/-.

SUBSIDIARY & ASSOCIATES

The Company has a wholly owned subsidiary namely Borosil Afrasia FZE (Free Zone Establishment) in Jebel Ali Free Zone situated in Dubai in United Arab Emirates (UAE).The said FZE is engaged in the business of marketing the Company's products in the Middle East and African markets.

The Company has formulated a Policy on material subsidiaries of the Company. The said policy is available on the website of the Company at http://www.borosil.com/doc_files/Policy%20for%20Determining%20Material %20Subsidiaries.pdf

The Company has two associate companies namely Gujarat Borosil Limited and Fennel Investment and Finance Private Limited by virtue of its holding of more than 20% of the respective equity share capital of those companies.

CONSOLIDATED FINANCIAL STATEMENTS

As per Section 129(3) of Companies Act, 2013, the Company has prepared a consolidated financial statement of the Company, along with Borosil Afrasia FZE (subsidiary), Gujarat Borosil Limited (in which the Company exercises more than 50% of the voting rights as per Accounting Standard 21) and Fennel Investment and Finance Private Limited (associate company). Apart from standalone annual accounts, consolidated accounts, Statement containing salient features on financial statements of subsidiary in form AOC 1, the individual standalone of all subsidiary/ associate as mentioned above will be uploaded on the website of the Company as per Section 136 of the Companies Act, 2013.

The Company will provide a copy of separate audited financial statements in respect of its subsidiaries to any shareholder of the Company who asks for it and the said annual accounts will also be kept open for inspection at the Registered Office of the Company and that of the subsidiary company.

The Consolidated Financial Statements of the Company are prepared in accordance with relevant Accounting Standards (AS) viz. AS 21, AS 23, AS 27 issued by the Institute of Chartered Accountants of India, forms part of this Annual Report.

BOARD OF DIRECTORS, ITS MEETINGS, EVALUATION ETC.

Board Meetings:

The Board of Directors of the Company met seven times during the year on 29th May, 2014; 30th May, 2014; 13th August, 2014; 3rd November, 2014; 30th January, 2015 ; 5th March, 2015 and 24th March, 2015.

Appointment of Independent Directors:

The Company had in its last Annual General Meeting appointed four Independent Directors in the Company namely Mr. U.K. Mukhopadhyay, Mr. Naveen Kumar Kshatriya, Mr. S. Bagai and Mrs. Anupa R. Sahney for a period of five years i.e. upto 31st March, 2019 under the Companies Act, 2013.

Declaration by Independent Directors:

The Company has received declaration of independence in terms of Section 149(7) of Companies Act, 2013 from the above mentioned Independent Directors.

Company's Policy on Directors' Appointment and Remuneration etc.:

Under Section 178 of the Companies Act, 2013, the Company has prepared a policy on Director's appointment and Remuneration. The Company has also laid down criteria for determining qualifications, positive attributes and independence of a Director.

Familiarization Programme for Independent Directors:

A Familiarization programme was prepared by the Company about roles, rights and responsibilities of Independent Directors in the Company, nature of industry in which the Company operates business model of the Company, etc., which was presented to Independent Directors on 3rd November, 2014. The details of the above programme are available on website of the Company at http://www.borosil.com/doc_files/Familarisation%20Programme%20for%20 Independent%20Directors.pdf

Formal Annual Evaluation:

The Formal Annual Evaluation has been made as follows:

1. The Company has laid down evaluation criteria separately for Board, Independent Directors, Directors other than Independent Directors and various committees of the Board. The criteria for evaluation of Directors (including the Chairman) included parameters such as willingness and commitment to fulfill duties, high level of professional ethics, contribution during meetings and timely disclosure of all the notice/details required under various provisions of laws. Based on such criteria, the evaluation was done in a structured manner through peer consultation & discussion.

2. Evaluation of the Board was made by a Separate Meeting of Independent Directors held under Chairmanship of Mr. U.K. Mukhopadhyay, Lead Independent director (without attendance of non - Independent Director and members of the management ) on 5th March, 2015.

3. The performance evaluation of all committees namely:

1. Audit Committee

2. Nomination and Remuneration Committee

3. Corporate Social Responsibility Committee

4. Share Transfer Committee

were done by the Board of Directors at its meeting held on 5th March, 2015. However, evaluation of Stakeholders Relationship Committee was done by the Board of Directors at their meeting held on 13th May, 2015.

4. Performance evaluation of non - Independent Directors namely Mr. B. L. Kheruka, Mr. P.K. Kheruka, Mr. Shreevar Kheruka and Mr. V. Ramaswami was done by Separate meeting of Independent Directors.

5. Evaluation of Independent Directors namely Mr. U.K. Mukhopadhyay, Mr. Naveen Kumar Kshatriya, Mr. S. Bagai and Mrs. Anupa R. Sahney was done (excluding the Director who was evaluated) by the Board of Directors of the Company at its meeting held on 5th March, 2015.

6. In addition, the Nomination and Remuneration Committee has carried out evaluation of every Director's performance at its meeting held on 5th March, 2015 as required under Section 178 (2) of the Companies Act, 2013.

7. The Directors expressed their satisfaction with the evaluation process.

As reported in our last report, Mr. Dhanendra Kumar, who was an Additional Director, resigned w.e.f. 10th May, 2014.

Mr. V. Ramaswami retires by rotation and, being eligible, offers himself for re-appointment.

KEY MANAGERIAL PERSONNEL

During the year, Mr. Rajesh Chaudhary, Chief Financial Officer of the Company was designated as Key Managerial Personnel under Section 203 the Companies Act, 2013.

Further, Mr. Shreevar Kheruka who was already Managing Director & CEO of the Company and Ms. Lovelina Faroz who was working as the Company Secretary were designated as Key Managerial Personnel's (KMPs) of the Company under the abovementioned provisions of the Companies Act, 2013 in their respective positions.

CORPORATE GOVERNANCE REPORT

A Report on Corporate Governance along with the Compliance Certificate from the Auditors is annexed hereto and forms part of this Report.

The Board of Directors of the Company has evolved and adopted a Code of Conduct and posted the same on the Company's website, "www.borosil.com". The Directors and senior Management personnel have affirmed their compliance with the Code for the year ended 31st March, 2015.

FIXED DEPOSITS

The Company has stopped accepting fresh fixed deposits since July 2006.

The details relating to unclaimed deposits are as under:

1. Deposits accepted during the year Nil

2. Deposits remained unpaid or Principle amount: Rs. 20,000/- unclaimed as at the end of Interest amount thereon: the year Rs. 5,089.04

3. Whether there has been any There has been no default in default in repayment of repayment of deposits or deposits or payment of payment of interest thereon. interest thereon during the year and if so, number of such cases and the total amount involved at the beginning of the year, maximum during the year and at the end of the year

4. The details of deposits Not Applicable which are not in compliance with the requirements of Chapter V of the Act

The unclaimed deposits pertain mainly to deceased deposit holders. As on the date of this Report, only two deposits remained unclaimed and the Company is making all efforts to reach out to concerned persons.

DEVELOPMENT AND IMPLENTATION OF RISK MANAGEMENT POLICY

The Company faces various risks in form of financial risk, operational risks etc. The Company understands that it needs to survive these risks in the market and hence have made a comprehensive policy on Risk Management.

RELATED PARTY TRANSACTIONS

The Company entered into various Related Party Transactions during the financial year which were in ordinary course of business. All such Related Party Transactions as also those transactions which were already in force were placed before the Audit Committee as also the Board for approval. The Company also gets approval of the Audit Committee of all transactions which are foreseen and repetitive in nature on quarterly basis. The Company obtained approval of shareholders through Postal Ballot during the year for entering into such Related Party Transactions which exceeded the threshold limits as mentioned under the Companies (Meetings of the Board and its Powers) Rules, 2013 or which were material in nature with Vyline Glass Works Limited and Gujarat Borosil Limited.

The Company has formulated a policy on dealing with Related Party Transactions. The same is available on the website of the Company at http://www.borosil.com/doc_files/Related%20Parties%20Transaction% 20Policy.pdf

Particulars of Contracts or Arrangements entered into with Related Parties referred to in Section 188(1) of the Companies Act, 2013, in prescribed form AOC-2 is attached as an 'Annexure A' to this Report.

The details of all the transactions with Related Party are provided in the accompanying financial statements.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

As part of its initiatives under "Corporate Social Responsibility" (CSR), the Company has undertaken projects in the areas of Education, Water and Health which were in accordance with Schedule VII of the Companies Act, 2013.

During the year the Company undertook a project through Chinmaya Vibhooti, a branch of Central Chinmaya Mission Trust for construction of a new well for the purpose of creating an Independent Source of water for drinking for ashram and its visitors. Such source of drinking water shall be great asset for them in far flung areas.

The Company contributed to a project of IIT, Bombay where a Chair was being created namely 'Prof N.R. Kamath Chair' for Institutional excellence with an initial corpus of Rs. 6 crores. The said corpus will be utilized to typically enable a Research and Teaching appointment for a minimum of one academic semester of a world class academician either on sabbatical from another University or from the permanent faculty of IIT, Bombay. This will enable to raise the bar and make IIT Bombay a truly world class University in years to come.

The Company also took part in organizing a General Medical camp through Rotary Club at Bharuch to undertake a 'preventive health care programme' in Bharuch District in Gujarat where the Company has its warehousing activities. Camps of such nature help to reach out to the utmost needy people of the surrounding areas. More than 2700 patients registered and were treated out of which 490 were recommended for surgery and more than 105 doctors rendered their honorary services. The said camp was organized in association with Indian Medical Association.

The Company contributed to a project of Friends of Tribal Society for promoting education through 'One Teacher School' called 'Ekal Vidyalaya' for tribal children in rural areas. This project helped in improving the socio-economic condition of the tribal society, spreading literacy and thus contributing to the progress of the entire community.

In terms of Section 135 of the Companies Act, 2013 and Rules made thereunder, the Company has constituted CSR committee comprising of the following members:

1. Mr. B.L. Kheruka

2. Mr. Shreevar Kheruka

3. Mr. U.K. Mukhopadhyay

4. Mr. Naveen Kumar Kshatriya

out of which Mr. U.K. Mukhopadhyay and Mr. Naveen Kumar Kshatriya are Independent Directors.

The CSR Committee of the Board of Directors

a. indicates the activities to be undertaken by the Company (within the framework of activities as specified in Schedule VII of the Act) during the particular year.

b. recommends to the Board the amount of expenditure to be incurred during the year under some of the activities covered in the Company's CSR Policy.

c. monitors the said Policy.

d. ensures that the activities as included in CSR Policy of the Company are undertaken by it in a phased manner depending on the available opportunities.

Company's CSR Policy:

The Board of Directors of the Company has approved the CSR Policy as recommended by the CSR Committee and the same has been uploaded on the Company's website at http://www.borosil.com/doc_files/Corporate%20Social%20Responsibility.pdf

Initiatives taken by the Company during the year:

The 2% of the net profits of the Company during the immediate three preceding financial years amounts to Rs. 58.15 lacs. The Company has spent a sum of Rs. 33.83 lacs during the year, as such the Company could not spend a sum of Rs. 24.32 lacs of the said 2% amount stipulated above. Reason being that the Company was looking for genuine and socially useful opportunity, where the money can be fruitfully used. The Company will make every endeavor to utilize its CSR expenditure during the current year.

An Annual Report on CSR activities in terms of Section 134 (3) (o) of the Companies Act, 2013 read with the Companies (Corporate Social Responsibility) Rules, 2014 is attached herewith as an 'Annexure B' to this Report.

EXTRACT OF ANNUAL RETURN

Extract of Annual Return in form MGT 9 is attached as an 'Annexure C' to this Report.

VIGIL MECHANISM

The Company has a vigil mechanism named Whistle Blower Policy to deal with instances of fraud and mismanagement.

SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS OR COURTS

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.

AUDITORS

M/s. Chaturvedi & Shah, Chartered Accountants, will retire as Auditors of the Company at the conclusion of the ensuing Annual General Meeting and being eligible have expressed their willingness for re-appointment. A written consent from the auditor has been received along with a certificate that their appointment if made, shall be in accordance with the prescribed conditions and the said Auditors satisfy the criteria provided in Section 141 of the Companies Act, 2013. The Report does not contain any qualification.

COST RECORDS AND AUDIT

Under the Section 148 of the Companies Act, 2013, the Central Government has prescribed maintenance and audit of cost records vide the Companies (Cost Records and Audit) Rules, 2014 to such class of companies as mentioned in the Table appended to Rule 3 of the said Rules. Although 'Glass' products are covered under the said Table, but the CETA headings under which Company's products are covered are not there. Hence, maintenance of cost records and also cost audit provisions are not applicable to the Company as of now.

SECRETARIAL AUDIT

Secretarial Audit Report dated 25th May, 2015 by Mr. Virendra Bhatt, Practising Company Secretary (CP no.124) is attached herewith as an 'Annexure D' to this Report. The Report does not contain any qualification.

TRANSFER TO INVESTOR EDUCATION AND PROTECTION FUND

The Company has transferred a sum of Rs. 3,92,012 during the financial year 2014-15 to the Investor Education and Protection Fund established by the Central Government in compliance with Section 124 of Companies Act, 2013. The Company has made all the transfers to the said fund in due time.

DIRECTORS' RESPONSIBILITY STATEMENT

Subject to disclosures in the Annual accounts and also on the basis of the discussion with the Statutory Auditors of the Company from time to time, the Board of Directors state as under:

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

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

(c) that we had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(d) that we had prepared the annual accounts on a going concern basis;

(e) and that we, had laid down Internal Financial Controls to be followed by the Company and that such Internal Financial Controls are adequate and were operating effectively.

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

PARTICULARS OF LOANS, GUARANTEES AND INVESTMENTS

A statement on Particulars of Loans, Guarantees and Investments is attached as an 'Annexure E' to this Report read with note no. 11 and 14 to the financial statements.

EMPLOYEES' SAFETY

The Company is continuously endeavoring to ensure safe working conditions for all its employees.

DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013

The Company has in place a Policy for Prevention, Prohibition and Redressal of Sexual Harassment at work place which is in line with the requirements of the Sexual Harassment of women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013 and Rules made thereunder. All employees (permanent, contractual, temporary and trainees) are covered under this Policy. The Company has constituted an Internal Complaint Committee for its Head Office and branch/sales offices under Section 4 of the captioned Act. No complaint has been filled before the said committee till date. The Company has filed an Annual Report with the concerned Authority in the matter.

DISCLOSURE UNDER RULE 5(1) OF THE COMPANIES (APPOINTMENT AND REMUNERATION), RULES, 2014

The information required pursuant to Section 197 read with Rule 5(1) of the Companies (Appointment and Remuneration), Rules, 2014 in respect of employees of the Company and Directors is attached as an ' Annexure F'.

PARTICULARS OF EMPLOYEES

Particulars of Employees as required under Rule 5(2) of the Companies (Appointment and Remuneration) Rules, 2014 is attached as an 'Annexure G'.

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

The Company is engaged in trading activity and it did not carry out any Research & Development activities nor introduced any new technology during the year. Hence, Rule 8 (3) of the Companies (Accounts) Rules, 2014 are not applicable with respect to those details.

Particulars with regard to foreign exchange earnings and outgo are furnished under note 34 to 37 of 'Notes to the Standalone Financial Statements'.

ACKNOWLEDGMENT

Your Directors record their appreciation for the co-operation received from the Employees, Customers and last but not the least the shareholders for their unstinted support, during the year under review.

For and on behalf of the Board of Directors

Place : Mumbai B. L. Kheruka Date : 25th May, 2015 Chairman


Mar 31, 2013

To The Members of BOROSIL GLASS WORKS LIMITED

The Directors present their Fiftieth Annual Report and the Audited Accounts for the year ended 31st March, 2013.

FINANCIAL RESULTS

(Rs. in lacs)

Year ended 31.03.2013 Year ended 31.03.2012

Revenue from Operations 13,447 12,602

Other Income 2,513 4,200

Profit for the year before Finance cost and Depreciation 2,836 4,136

Less: Finance Cost 27 18

Less: Depreciation & Amortisation Expenses 205 75

Profit for the year before tax 2,604 4,043

Less: Provision for Income Tax 452 761

Less: Deferred Tax 334 186

Less: MAT Credit entitlement (171) (133)

Less: Provision / (Written back) of Income Tax of earlier years 5 (24)

Profit for the year 1,984 3,253

Add: Balance as per last year 60,439 58,060

Amount available for Appropriation 62,423 61,313

Appropriations

Amount Transferred to General Reserve 200 330

Dividend on Equity Shares 451 468

Tax on above Dividend 77 76

Proposed Dividend & Tax thereon of earlier year written back (1) -

Balance carried to Balance Sheet 61,696 60,439

BUY-BACK OF EQUITY SHARES

In terms of Special Resolution passed by the shareholders by way of postal ballot on 11th November, 2011, the Company bought back and extinguished 9,57,928 equity shares for a total consideration of Rs. 8,135.89 Lacs by utilizing the Security Premium Account and General Reserve to the extent of Rs. 1,721.62 Lacs and Rs. 6,318.48 Lacs respectively. The Company closed the said buy-back on 10th October, 2012. Thereby, as on 31st March, 2013, the Company had 30,06,000 issued and paid-up equity shares. In terms of Section 77AA of the Companies Act, 1956, Capital Redemption Reserve has been created out of General Reserve for an amount of Rs. 95.79 lacs, being the nominal value of shares so bought back.

DIVIDEND

The Board of Directors recommends a dividend of Rs. 15/- per equity share for the year ended 31st March, 2013.

PERFORMANCE

Your Company has generated a pre-tax business profit of Rs. 26.04 crores, during the year under review as compared to Rs. 43.81 crores (before tax and exceptional items) in the previous year.

During the course of the year, the Company has further consolidated its leadership position in both the laboratory glassware as well as the microwavable glassware segments. This has been owing to enhanced focus on key customer coverage, new product introductions as well as distribution enhancements. Moreover, the Company has invested approximately Rs. 7.91 Crores on an advertising campaign / marketing activities in order to increase awareness of its product across the country.

The Company''s efforts for organic as well as inorganic expansion both in India and abroad continues.

The Company has invested its investible funds of around Rs. 539 Crores as on 31st March, 2013 in a mixture of Debt markets, Equity/Equity Linked Instruments, Bonds/Debentures, Convertible Preference Shares, Non-Convertible Redeemable Preference Shares, Commodities, Real Estate, Opportunity based Funds, Real Estate Funds and Mutual Funds.

However, the general sluggishness in the economy as a whole has impacted performance of both divisions of the Company.

Scientific & Industrial Products Division (SIP)

The SIP division has seen a growth of 3% over the last financial year. During the year, market reports suggest that sales made by our main competitors in this segment have de-grown or stayed flat.

The Company had employed a strategy consulting firm to examine areas for prospective growth in the laboratory consumables industry. The Company is now taking steps to ensure the implementation of the said strategy.

As a result of this study, the company is pleased to launch its foray into chromatography vials used in laboratory of major pharma and research companies, have extensive usage and are currently being imported into the country by the existing players. Your company is very optimistic of good performance in this segment depending on improvement in the economic climate of the country and allocation of fund(s) by the Government for scientific and industrial research.

Consumer Products Division

The consumer products division has seen a growth of 15% over the last financial year. Owing to the large presence of unorganized players in the segment, the Company has been unable to determine an accurate growth rate for this industry.

The Company has taken various steps to enhance its leadership position in the microwaveable glassware segment. These steps include:

- enhancement of product portfolio

- enhancement of distribution network in south and east India

- increased consumer awareness campaign through a marketing budget of roughly Rs. 7.91 Crores.

The outlook for the consumer products division is neutral as compared to last year due to a reduction in consumer spending across all segments owing to macro-economic reasons and inflationary pressure.

Export Division

Exports during the year were higher at Rs. 5.18 Crores as compared to Rs. 4.63 Crores in the previous year. This represents an increase of nearly 12 %.

The Company feels that further substantial improvement can be made in exports. The Company is already in touch with a number of potential large customers for its products and expects to do well in this division during the current year.

Other Actions

As reported last year, the Company is in final stage of completing the construction of modern warehouse at Village: Dumala Boridra in Bharuch District of Gujarat for its own use as well as for leasing out a portion to others.

The Company has recently acquired a long term leasehold right in a ready factory premises at MIDC Tarapur, Boisar, Dist: Thane, for Rs. 16.06 crores, of which the Company intends to lease out a substantial portion to its supplier company Vyline Glass Works Ltd for carrying out manufacturing activities there and for supply of such manufactured products to the Company.

Investments

The Company started investing in various debt, equity and real estate instruments as per the Investment policy mandate shared with the Board. During first three quarters of the year, the Stock market had shown good performance. However, this was negated to a great extent by poor performance in the last quarter. The Company has significant unrealised income from its investments that will be realised when these investments are sold or mature or when dividends are received.

FIXED DEPOSITS

The Company has stopped accepting fresh fixed deposits since July 2006. The total amount of unclaimed deposits as on 31st March, 2013 was Rs. 9.32 lacs, and no further claim has been received since then till date.

DIRECTORS

The Directors regret to report the sad demise of Mr. K. V. Krishnamurthy, Independent Director of your Company on 16.01.2013. The Board of Directors records their appreciation for guidance received from late Mr. K. V. Krishnamurthy during his tenure as a Director of the Company as well as Chairman of Audit Committee of the Board of Directors of the Company. The Company has appointed Mr. Naveen Kumar Kshatriya as an Additional Director w.e.f. 09th May 2013. The Company has received notice from a member of the Company under Section 257 of the Companies Act, 1956 in respect of his appointment as Director, alongwith the requisite deposit.

Mr. B. L. Kheruka''s term as an Executive Chairman is expiring on 15th December, 2013 and the same is being renewed for a further period of 5 years w.e.f. 16th December, 2013.

Mr. U. K. Mukhopadhyay and Mr. Dinesh Nanik Vaswani, retire by rotation and, being eligible, offer themselves for reappointment.

Brief details of the Directors being appointed / reappointed have been incorporated in the Notice for the forthcoming Annual General Meeting.

AUDITORS

M/s. Chaturvedi & Shah, Chartered Accountants, will retire as Auditors of the Company at the conclusion of the ensuing Annual General Meeting and being eligible have expressed their willingness for re-appointment.

COST RECORDS AND AU DIT

In supersession of various earlier orders, the Central Government vide its Order no. 52/26/CAB-2010 dated 6th November, 2012 made the Companies (Cost Accounting Records) Rules, 2011 (the Rules) applicable, inter alia, to Glass and Glass Products, subject to various clarifications issued by the Ministry of Corporate Affairs on the subject of cost audit; to the extent these are relevant and applicable. Accordingly, as per clarification issued by the Central Government vide Circular No. 67/ 2011 dated 30th November, 2011, the Rules do not apply to wholesale or retail trading activities and ancillary products which constitute less than 2% of the total turnover of the Company or Rs. 20 Crores, whichever is lower provided required details of the same are maintained and disclosed. Since the Company is engaged in trading activities as also in business of some ancillary products having turnover less than the limit prescribed above, the said Rules regarding maintenance of cost records do not apply to the Company and as a consequence, Cost Audit is also not applicable to the Company.

COMPLIANCE CERTIFICATE

In accordance with requirement of Section 383A of the Companies Act, 1956, certificate from a practising Company Secretary is enclosed in respect of the Company for the year ended 31st March, 2013.

DIRECTORS'' RESPONSIBILITY STATEMENT

Subject to disclosures in the Annual accounts and also on the basis of the discussion with the Statutory Auditors of the Company from time to time, the Board of Directors state as under:

i) that in the preparation of the annual accounts, the applicable accounting standards have been followed and there were no material departures.

ii) that we have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the Profit of the Company for that period.

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

iv) that we have prepared the annual accounts on a going concern basis.

CORPORATE GOVERNANCE REPORT

A Report on Corporate Governance along with the Compliance Certificate from the Auditors is annexed hereto and forms part of this Report.

The Board of Directors of the Company has evolved and adopted a Code of Conduct and posted the same on the Company''s website, ''www.borosil.com''. The Directors and senior Management personnel have affirmed their compliance with the Code for the year ended 31st March, 2013.

EMPLOYEES'' SAFETY

The Company is continuously endeavoring to ensure safe working conditions for all its employees.

PARTICULARS OF EMPLOYEES

Particulars of Employees as required under Section 217(2A) of the Companies Act, 1956 are annexed hereto and form part of this report.

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

The Company is engaged in trading activity and it did not carry out any Research & Development activities nor introduced any new technology during the year. Hence, the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are not applicable with respect to those details.

Particulars with regard to foreign exchange earnings and outgo are furnished under note no. 35 to 38 of ''Notes to the financial statements''.

ACKNOWLEDGEMENT

Your Directors record their appreciation for the co-operation received from the Employees, Customers and last but not the least the shareholders for their unstinted support, during the year under review.

For and on behalf of the Board of Directors

Place: Mumbai B. L. Kheruka

Date: 9th May, 2013 Chairman


Mar 31, 2012

To The Members of BOROSIL GLASS WORKS LIMITED

The Directors present their Forty Ninth Annual Report and the Audited Accounts for the year ended 31st March, 2012.

FINANCIAL RESULTS

(Rs.in lacs)

Year ended 31.03.2012 Year ended 31.03.2011

Revenue from Operations 12,602 11,914

Other Income 4,200 3,127 Profit for the year before Finance Cost,

Depreciation and Extra Ordinary Items 4,136 1,797

Less: Finance Cost 18 250

Less: Depreciation & Amortisation Expenses 75 82

Less: Extra Ordinary Items (Net) - 78,422

Profit for the year before tax 4,043 79,887

Less: Provision for Income Tax 761 15,954

Less: Deferred Tax / (Credit) 186 (386)

Less: MAT Credit entitlement (133) (462)

Less: Income Tax of earlier years (24) 1

Profit for the year 3,253 64,780

Add: Amount Transferred from Revaluation Reserve - 2,393

Add: Balance as per last year 58,060 (767)

Amount available for Appropriation 61,313 66,406 Appropriations

Transferred to General Reserve 330 6,500

Interim Dividend on Equity Shares - 991

Tax on above Dividend - - 165

Final Dividend on Equity Shares 468 594

Tax on above Dividend 76 96

Balance carried to Balance Sheet 60,439 58,060

BUY-BACK OF EQUITY SHARES

In terms of Special Resolution passed by the shareholders by postal ballot on 11th November, 2011, the Company started buy back of its equity shares with effect from 19th December, 2011 at a maximum price off 8501- per share and till 31st March, 2012, 8,28,577 equity shares were bought back and duly extinguished, thereby the issued and paid-up share capital of the Company comprised of 31,35,351 equity shares as on the said date. The said buy back continues.

DIVIDEND

The Board of Directors recommends a dividend of t 15/- per equity share for the year ended 31st March, 2012.

PERFORMANCE

Your Company has generated a business profit of Rs 43.81 crores from ordinary activities (before tax and exceptional items), during the year under review as compared to Rs 17.13 crores in the previous year.

During the course of the year, the Company has further consolidated its leadership position in both the laboratory glassware as well as the microwavable glassware segments. This has been owing to enhanced focus on key customer coverage, new product introductions as well as distribution enhancements. Moreover, the Company has invested approximately Rs 4.00 Crores on an advertising campaign in order to increase awareness of its product across the country.

All the above activities have led to an enhancement of sales made by the Company of the higher margin products by about 20% from Rs 100 crores to Rs 120 crores. However, sales of low margin items have continued to be strategically discontinued resulting in a reduction of their sale from Rs 19 crores to Rs 6 crores.

The Company is on the lookout for avenues of organic as well as inorganic expansion both in India and Abroad. A number of prospects have been identified and further progress on these initiatives is likely to materialize in the near future.

The Company has invested its investible funds of around Rs 467 crores as on 31st March, 2012 in a mixture of Debt markets, Equity/Equity Linked Instruments, Bonds/Debentures, Convertible Preference Shares, Real Estate Funds, Opportunity based Funds and Commodity Funds as well as in Mutual Funds. This includes Rs 90 crores invested by subscribing in 90,00,000- 9 % Cumulative Non-Convertible Redeemable Preference Shares of Gujarat Borosil Limited on private placement basis, as a Promoter Company. Further, during the year under reference, the Company spent nearly Rs 43 crores for its new corporate office and Rs 70.53 crores for buy-back of its equity shares.

Scientific & Industrial Products Division (SIP)

The SIP division has seen a growth of 15% over the last financial year. During the year, market reports suggest that sales made by our main competitors de-grown or stayed flat.

The Company had employed a strategy consulting firm to examine areas for prospective growth in the laboratory consumables industry. This study has been finalized and the Company is taking steps to ensure the implementation of the same strategy. These steps should yield positive results in the future for this division depending on improvement in the economic climate of the country and allocation of fund(s) by the Government for scientific and industrial research.

Consumer Products Division

The consumer products division has seen a growth of 26% over the last financial year. Owing to the large presence of unorganized players in the segment, the Company has been unable to determine an accurate growth rate for this industry. However, when compared to the growth rates of organized peers, the Company has shown a favorable performance.

The Company has taken various steps to enhance its leadership position in the microwaveable glassware segment. These steps include:

- enhancement of product portfolio

- enhancement of distribution network in south and east India

- increased consumer awareness campaign through a marketing budget of roughly Rs 4 Crores.

The outlook for the consumer products division is somewhat muted as compared to last year due to a reduction in consumer spending across all segments owing to macro-economic reasons and inflationary pressure.

Export Division

Exports during the year were higher at f 4.63 crores as compared to Rs 3.16 crores in the previous year. This represents an increase of 47%.

The Company feels that further substantial improvement can be made in exports. The Company is already in touch with a number of potential large customers for its products and expects to do well in this division for the current year.

Other Actions

Your Company explored the possibility of acquiring some companies in the last financial year in Europe as well as in India. These could not materialize owing to a large difference in valuation offered and demanded. However, the Company is continuing its endeavor of looking out for other such prospects in India and overseas and some proposal(s) may materialize during the current year.

The Company is constructing a modern warehouse at Village: Dumala Boridra in Bharuch District of Gujarat for its own use as well as for leasing out a portion to others.

Investments

The Company started investing in various debt, equity and real estate instruments as per the Investment policy mandate shared with the Board. Over the past few months, the stock market in India has witnessed a lot of fluctuations. This has resulted in the Company incurring some losses but these have been lower than the corresponding stock market indices. While the stock market is currently passing through a difficult phase, the investments in debt related instruments are likely to yield steady return.

FIXED DEPOSITS

The Company has stopped accepting fresh fixed deposits since July, 2006. The total amount of unclaimed deposits as on 31st March, 2012 was Rs 9.57 lacs and no further claim has been received since then till date.

DIRECTORS

Mr. Shreevar Kheruka is proposed to be appointed as a Managing Director of the Company for a period of 5 years w.e.f. 16th August, 2012, for which necessary approval is being sought from the Shareholders at the ensuing Annual General Meeting.

Mr. V. Ramaswami's term as Whole-time Director is expiring on 31s( August, 2012 and the same is being renewed for a further period of 3 years w.e.f. 01st September, 2012.

Mr. V. Ramaswami, Mr. P. K. Kheruka and Mr. K.V. Krishnamurthy, retire by rotation and, being eligible, offer themselves for re- appointment. Brief details of the Directors being appointed / re-appointed have been incorporated in the Notice for the forthcoming Annual General Meeting.

AUDITORS

M/s. Chaturvedi & Shah, Chartered Accountants, will retire as Auditors of the Company at the conclusion of the ensuing Annual General Meeting and being eligible have expressed their willingness for re-appointment.

COST RECORDS AND AUDIT

The Central Government, vide Notification No. G.S.R. 429(E) dated 03rd June, 2011 made maintenance of Cost Accounting Records applicable to all companies engaged in activities mentioned therein. Your Company prima facie came under the ambit of the same. Later on, vide Order F.No.52/26/CAB-2010 dated 30th June, 2011, the Central Government made Cost Audit applicable; inter alia, to the glass industry. However, subsequently, the Central Government vide Circular No. 67/2011 dated 30th November, 2011 issued a clarification to the effect that the Companies (Cost Accounting Records) Rules, 2011 shall not apply to Wholesale or retail trading activities and ancillary products which constitute less than 2% of the total turnover of the Company or Rs 20 crores, whichever is lower, provided required details of the same are maintained and disclosed. Since the Company is engaged in trading activities as also in business of some ancillary products having turnover less then the limit prescribed above, the said Rules regarding maintenance of cost records do not apply to the Company and as a consequence, Cost Audit is also not applicable to the Company.

DIRECTORS' RESPONSIBILITY STATEMENT

Subject to disclosures in the Annual accounts and also on the basis of the discussion with the Statutory Auditors of the Company from time to time, the Board of Directors state as under:

i) that in the preparation of the annual accounts, the applicable accounting standards have been followed and there were no material departures.

ii) that we have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the Profit of the Company for that period.

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

iv) that we have prepared the annual accounts on a going concern basis.



CORPORATE GOVERNANCE REPORT

A Report on Corporate Governance along with the Compliance Certificate from the Auditors is annexed hereto and forms part of this Report.

The Board of Directors of the Company has evolved and adopted a Code of Conduct and posted the same on the Company's website, 'www.borosil.com'. The Directors and senior Management personnel have affirmed their compliance with the Code for the year ended 31st March, 2012.

EMPLOYEES'SAFETY

The Company is continuously endeavoring to ensure safe working conditions for all its employees.

PARTICULARS OF EMPLOYEES

Particulars of Employees as required under Section 217(2A) of the Companies Act, 1956 are annexed hereto and form part of this report.

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

The Company is engaged in trading activity and it did not carry out any Research & Development activities nor introduced any new technology during the year. Hence, the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are not applicable with respect to those details.

Particulars with regard to foreign exchange earnings and outgo are furnished under note no. 36 to 39 of 'Notes to the financial statements'.

ACKNOWLEDGEMENT

Your Directors record their appreciation for the co-operation received from the Employees, Customers and last but not the least the shareholders for their unstinted support, during the year under review.

For and on behalf of the Board of Directors

Place: Mumbai B. L. Kheruka

Date : 24th May, 2012 Chairman


Mar 31, 2011

The Directors present their Forty Eighth Annual Report and the Audited Accounts for the year ended 31st March, 2011.

FINANCIAL RESULTS

(Rupees in lacs)

Year ended 31.03.2011 Year ended 31.03.2010

Gross Sales (Including Excise Duty) 11,978 9,109

Other Income 3,131 186

Profit/(Loss) for the year before Interest, Depreciation and Extra Ordinary Items 1,781 (52)

Less: Interest 235 514

Less: Depreciation 82 170

Less: Extra Ordinary Items (Net) 78,423 (1,870)

Profit/(Loss) for the year before tax 79,887 (2,606)

Less: Provision for Income Tax 15,954 -

Less: Deferred Tax (Credit) (386) (126)

Less: MAT Credit entitlement (462) -

Less: Provision / (Written back) of Income Tax of earlier years 1 (1)

Profit/(Loss) for the year 64,780 (2,479)

Add: Amount Transferred from Revaluation Reserve 2,393 -

Add: Balance as per last year (767) 1,342

Add: Amount Transferred from General Reserve - 370

Less: Amount Transferred to General Reserve 6,500 -

Amount available for Appropriation 59,906 (767)

Appropriations

Interim Dividend on Equity Shares 991 -

Tax on above Dividend 165 -

Final Dividend on Equity Shares 595 -

Tax on above 96 -

Balance carried to Balance Sheet 58,059 (767)

DIVIDEND

The Company has already paid an interim dividend of Rs. 25/- per share amounting to Rs.991 lacs. The Board of Directors now recommend a final dividend of Rs.15/- per share for the year ended 31st March, 2011, making it a total dividend of Rs.40/- on each Equity Share of Rs.10/- for the year under review.

PERFORMANCE

During the year, the Company sold its property at Marol, Mumbai for a sum of Rs.830 crores. The buyer had been shortlisted by a reputed agency mandated by the Company for the purpose. The entire process was run independently in a completely transparent manner. Your Directors were able to obtain perhaps the most favourable price for its asset in the city of Mumbai as compared with the prices obtained in similar transactions in that period. The decision to divest was most timely, because the real estate market has since then witnessed a slump. This is the result of painstaking efforts made by the Company in reshaping hitherto industrial land into a salable land parcel and obtaining the plethora of permissions required for the purpose. After paying Income Tax (MAT) of Rs.159 crores, meeting all expenses pertaining to the said deal, repaying loans and payment of Interim Dividend of Rs.11.55 crores with tax thereon, the Company has nearly Rs.600 crores fund.

The Company is on the look out for new business opportunities both in India and abroad. Till such time that an opportunity arises, the Company has invested the funds as per an Investment Policy adopted by the Board of Directors of the Company, which envisages a reasonable return with a low degree of risk. The Company has appointed three well known Wealth Managers to advise the Company in the matter. Accordingly, investments made by the Company have been spread over debts, Equity/Equity Linked Instruments, Bonds/Debentures, Convertible Preference Shares, Real Estate Funds, Opportunity based Funds and Commodity Funds as well as in Mutual Funds. Your Company has invested the funds in such a manner in order to protect the purchasing power of these funds in view of the inflationary environment currently being experienced in our country. Your Company aims to generate a pretax return of 8-10% in the medium term from these investments in order to match inflation.

The divestment of land has freed the Company to focus on core issues pertaining to its business. To this end, the Company has made a number of changes that has directly resulted in substantial growth in both, the scientific products and consumer products divisions. Some of these changes include:

- Enhancement of sales personnel across the country

- Geographical expansion of distribution

- New products introduction

- Improvement of product availability

- Infrastructure enhancement such as increasing warehousing capabilities, better packaging for reduction of transit losses

- Customer relationship management (CRM) software to improve customer focus and deliveries

An infusion of fresh thinking and a young team have helped to reduce costs and increase turnover, all of which have culminated into a robust growth of turnover in the glass business from Rs.88 crores in the previous year to Rs.119 crores in the year 2010-11, representing an increase of 36%.

Your Company has emerged from a loss of Rs.7.36 crores in the previous year, to generate a business profit of Rs 17.13 crores from ordinary activities (before tax, exceptional and extraordinary items), during the year under review. The overall profit for the year including profit from sale of Marol property amounted to Rs.799 crores before tax.

Scientific & Industrial Products Division (SIP)

The SIP division has seen a growth of 34% over the last financial year. Various consultants have estimated growth of the laboratory consumables industry at around 15% for the last year. This means that the company has successfully improved its market share from around 43% to 47% this year. Our long-term goal is to achieve a market share of around 55-60% in the glassware portion of the laboratory consumables industry.

The Company has emerged as an important partner with some of the leading companies in the Pharmaceutical and R&D industry by providing highly accurate laboratory apparatus - a pre-requisite for their high-end research programmes. The Company has also enhanced its product range in this field by including a tissue culture range of disposable plastics.

It is clear that in order for the Company to grow rapidly, the Company has to enhance its product portfolio. The Company is currently in the midst of a study in partnership with a strategy consulting firm in order to determine the future area for growth in the laboratory consumables industry. The findings of this study and suggested course of action will be reviewed by the Board in due course of time.

The outlook for the coming year continues to look good with the increased investments being made by the pharmaceutical industry and research and development segments acting as drivers of growth for laboratory glassware. The addition of new product ranges will also help the Company serve its customers better and result in enhanced sales and profitability.

Consumer Products Division

The consumer products division has seen a growth of 43% over the last financial year. Owing to the large presence of unorganized players in the segment, the Company has been unable to determine an accurate growth rate for this industry. However, when compared to the growth rates of organized peers, the Company has shown a favorable performance.

The Company has taken various steps to enhance its leadership position in the microwaveable glassware segment. These steps include:

- enhancement of product portfolio

- enhancement of distribution network in south and east India

- introduction of new product lines

- expansion of reach through the modern trade format like Bharti-Walmart, Reliance, DMart etc.

In addition to the above steps, the Company has also decided to embark on an aggressive marketing campaign for the current year. To this end, the Company has hired a reputed marketing strategy consulting firm. The Company expects to roll out this campaign from the 2nd quarter of the new financial year.

Finally, the Company has been able to start relationship with two other suppliers in the area of Bake & Serve range of products. This has helped us substantially to reduce risk of overdependence on a single source for supply for this line of the Companys products.

The outlook for the consumer products division is strong as increased consumer spending in India is acting as a strong driver of growth for this segment as a whole. With the addition of new product lines as well as the new marketing campaign the Company wishes to undertake, it expects to continue its strong growth trajectory in this area.

The Company has been successful in tailoring its offering so that it has tapped the expansion in customer base taking place in India.

Export Division

Exports during the year were higher at Rs.316 lacs as compared to Rs.251 lacs in the previous year. This represents an increase of 26%.

The Company feels that substantial improvement can be made in exports. With enhanced focus on this division and with improved product availability, the Company hopes to see a much better performance this year.

Other Actions

Your Company explored the possibility of acquiring some companies in the last financial year in Europe as well as in India. These could not materialize owing to a large difference in valuation offered and demanded. However, the Company is continuing its endeavor of looking out for other such prospects in India and overseas.

The Company has kept on hold the setting up of a new borosilicate glass melting plant in the Bharuch District of Gujarat. The Company is able to source its products at prices that remain attractive when compared to the cost of manufacturing by itself. This decision will be reviewed periodically.

Investments

The Company started investing in Equity and Equity Linked Instruments as per the Investment policy mandate shared with the Board. Over the past few months, the stock market in India has witnessed a lot of fluctuations. This has resulted in the Company incurring some losses in sync with the markets during the year under review. However, in view of inherent strength of Indian economy, the stock market is expected to do well in the medium to long run and based on this, the Company hopes not only to recover a major portion of such losses but also to generate positive returns over a period of time.

FIXED DEPOSITS

The Company has stopped accepting fresh fixed deposits since July 2006. The total amount of unclaimed deposits as on 31st March, 2011 was Rs.12 lacs, and no further claim has been received since then till date.

DIRECTORS

Mr. B. L. Kheruka was appointed as Executive Chairman and Mr. Shreevar Kheruka as a Wholetime Director of the Company respectively for a period of 3 years w.e.f. 16th December, 2010. Shareholders have approved their appointments by way of necessary resolutions passed by Postal Ballot. Mr. P. K. Kherukas term as Managing Director is expiring on 31st July, 2011 and he has decided not to seek reappointment as such but will continue on the Board of Directors of the Company as a Director (designated as Vice Chairman).

Mr. A. C. Dalal (aged 89 years) resigned as Director w.e.f. 21st February, 2011.

Mr. Dinesh Vaswani, an MBA from Wharton School of Business, was appointed as an Additional Director of the Company w.e.f. 17th March, 2011. The Company has received notice from a member of the Company under Section 257 of the Companies Act, 1956 in respect of his appointment as Director, alongwith the requisite deposit.

Mr. S. Bagai and Mr. B. L. Kheruka retire by rotation and, being eligible, offer themselves for reappointment.

Brief details of the Directors being appointed / reappointed have been incorporated in the Notice for the forthcoming Annual General Meeting.

AUDITORS

M/s. Chaturvedi & Shah, Chartered Accountants, will retire as Auditors of the Company at the conclusion of the ensuing Annual General Meeting and being eligible have expressed their willingness for re-appointment.

DIRECTORS RESPONSIBILITY STATEMENT

Subject to disclosures in the Annual accounts and also on the basis of the discussion with the Statutory Auditors of the Company from time to time, the Board of Directors state as under:

i) that in the preparation of the annual accounts, the applicable accounting standards have been followed and there were no material departures.

ii) that we have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the Profit of the Company for that period.

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

iv) that we have prepared the annual accounts on a going concern basis.

CORPORATE GOVERNANCE REPORT

A Report on Corporate Governance along with the Compliance Certificate from the Auditors is annexed hereto and forms part of this Report.

The Board of Directors of the Company has evolved and adopted a Code of Conduct and posted the same on the Companys website, www.borosil.com. The Directors and senior Management personnel have affirmed their compliance with the Code for the year ended 31st March, 2011.

EMPLOYEES SAFETY

The Company is continuously endeavoring to ensure safe working conditions for all its employees.

PARTICULARS OF EMPLOYEES

Particulars of Employees as required under Section 217(2A) of the Companies Act, 1956 are annexed hereto and form part of this report.

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

During the year under review, the Company was engaged mainly in trading activity and a small portion of manufacturing activities was outsourced. The Company did not carry out any Research & Development activities nor introduced any new technology. Hence, the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are not applicable with respect to those details.

Particulars with regard to foreign exchange earnings and outgo are furnished under Items 18 to 21 of Schedule 15 Notes on Accounts.

ACKNOWLEDGEMENT

Your Directors record their appreciation for the co-operation received from the Employees, Bankers, Customers and last but not the least the shareholders for their unstinted support, during the year under review.

For and on behalf of the Board of Directors

Place: Mumbai B. L. Kheruka

Date : 27th May, 2011 Chairman


Mar 31, 2010

1. The Directors have pleasure in presenting their 138th Annual Report and the Audited Accounts for the year ended 31st March, 2010 together with the Auditor’s Report thereon.

2. Financial Results Rs. in lakhs Particulars For the year For the year ended ended 31st March, 31st March, 2010 2009 Total Income 81,704.93 59,595.36 Profi t Before Extraordinary & Exceptional Items 38,589.84 19,751.49 Extraordinary & Exceptional Items 5,023.23 1,600.77 Profi t before tax 33,566.61 18,150.72 Less : Tax 5,129.11 3,198.89 Profi t after Tax 28,437.50 14,951.83 Reversal of Excess Tax Provision for Earlier Years 648.75 - Profi t Brought Forward from Previous Year 21,680.90 13,656.94 Net Profi t available for appropriation 50,767.15 28,608.77 Appropriation : Transfer to General Reserve 5,000.00 1,496.00 Transfer to Debenture Redemption Reserve - 2,492.00 Proposed Dividend on Preference Shares 0.01 0.01 Proposed Dividend on Equity Shares 4,188.01 2,512.81 Distribution Tax Thereon 695.57 427.05 Profi t carried to the Balance Sheet 40,883.56 21,680.90

3. Dividend Preference Shares

The Board of Directors have recommended dividend of Re. 0.50 per Preference Share of Rs. 10/- each for the year ended 31st March, 2010.

Equity Shares

The Board of Directors have recommended dividend of Rs. 1.50 per Equity Share of Rs. 2/- each for the year ended 31st March, 2010.

The dividend will be free of tax in the hands of the shareholders. Total cash outfl ow on account of these dividend payments together with distribution tax will be Rs. 4,883.58 lakhs.

4. Operations of the Company

During the year ended 31st March, 2010, the Company has earned revenue of Rs. 81,704.93 lakhs as compared to Rs. 59,595.36 lakhs for the previous year ended 31st March, 2009. Profi t after Tax was Rs. 28,437.50 lakhs as against Rs. 14,951.83 lakhs in the previous year.

5. Management Discussion and Analysis Report

As required by Clause 49 of the Listing Agreement with the Stock Exchanges, Management Discussion and Analysis Report is appended to this report.

6. Corporate Governance

As required by Clause 49 of the Listing Agreement, a Report on Corporate Governance is appended together with a Certifi cate on Corporate Governance from M/s. Nilesh G. Shah, Practising Company Secretary confi rming compliance with the conditions of Corporate Governance as stipulated under the aforesaid Clause 49.

As a part of good Corporate Governance, the Board of Directors of the Company has appointed M/s. Mahesh S. Darji, Practising Company Secretary to conduct Secretarial Audit of the Company. The Secretarial Compliance Certifi cate in respect of compliance of all rules, regulations under the various applicable provisions of the Companies Act, 1956, SEBI Regulations and the applicable regulations under the Listing Agreement entered with the Stock Exchanges is provided in the Annual Report.

7. Directorate

In accordance with the provisions of the Companies Act, 1956 and the Articles of Association of the Company, Mr. C. M. Hattangdi, Mr. Sudhindar Khanna and Lt. Gen. Deepak Summanwar, Directors of the Company retire by rotation at this Annual General Meeting and being eligible, offer themselves for re-appointment.

Ms. Urvi A. Piramal, Mr. Rajeev A. Piramal, Mr. Mahesh S. Gupta and Mr. Rajesh Jaggi are being re-appointed as the Executive Chairperson, Executive Vice Chairman, Group Managing Director and Managing Director respectively for a period of 5 (fi ve) years.

8. Auditors

The Auditors, M/s. Haribhakti & Co., retire at this Annual General Meeting and are eligible for re-appointment. The Board recommends their re-appointment as Auditors to audit the accounts of the Company for the fi nancial year 2010- 2011.

The Company has received a letter from the Auditors to the effect that their re-appointment, if made, will be within the prescribed limits under Section 224(1B) of the Companies Act, 1956 and that they are not disqualifi ed for re-appointment within the meaning of Section 226 of the said Act.

9. Particulars of Employees

The Directors acknowledge with thanks the contribution made by the employees towards the growth of the Company and appreciate their unstinted co-operation and support to the Management.

Any member interested in obtaining a copy of the statement of particulars of employees referred to in Section 217(2A) of the Companies Act, 1956, may write to the Company Secretary at the Registered Offi ce of the Company.

10. Subsidiary Companies / Consolidated Accounts

With a view to restructure and consolidate the holdings of the Company and for administrative convenience of holding investments in a single Company, it was decided that an Intermediate Wholly Owned Subsidiary Company i.e. Peninsula Holdings and Investments Private Limited (formerly known as Boom Realty Private Limited) would hold the investments of the Company in the following Subsidiary Companies :- (i) City Parks Private Limited (ii) Inox Mercantile Company Private Limited (iii) Peninsula Facility Management Services Limited (iv) Peninsula Investment Management Company Limited (v) Peninsula Mega Township Developers Private Limited (vi) Peninsula Pharma Research Centre Private Limited

(vii) Peninsula Trustee Limited

(viii) Planetview Mercantile Company Private Limited

(ix) Rishiraj Enterprises Limited

(x) RR Mega Property Developers Private Limited

(xi) RR Real Estate Development Private Limited

(xii) Takenow Property Developers Private Limited

By virtue of the said transfer, Peninsula Holdings and Investments Private Limited has become the Holding Company of the above 12 Subsidiary Companies and the said Subsidiary Companies have become the step down Subsidiary Companies of the Company.

The following Companies however remain the Subsidiary Company of Peninsula Land Limited :

1. Champs Elysee Enterprises Private Limited

2. Peninsula Mega Properties Private Limited

3. Renato Finance & Investments Private Limited

The Central Government has granted exemption under Section 212(8) of the Companies Act, 1956, from attaching to the Balance Sheet of the Company, the Accounts and the other documents of its Subsidiary Companies. However, the Consolidated Financial Statements of the Company, which include the results of the said Subsidiary Companies, are included in this Annual Report. In accordance with the Guidelines of Accounting Standard - 21 issued by The Institute of Chartered Accountants of India, the fi nancial statements of Rishiraj Enterprises Limited have not been included in the said Consolidated Financial Statements of the Company, since it ceased to be a subsidiary of the Company with effect from 19th April, 2010. Further, a statement containing the particulars prescribed under the terms of the said exemption for each of the Company’s Subsidiaries are also enclosed. Copies of the Audited Annual Accounts and related detailed information of all the Subsidiary Companies can also be sought by any investor of the Company or its Subsidiaries on making a written request to the Company Secretary at the Registered Offi ce of the Company in this regard. The Annual Accounts of the Subsidiary Companies are also available for inspection at the Company’s and / or the concerned Subsidiaries’ Registered Offi ce.

Details of the various Subsidiary Companies are as under:

Peninsula Holdings and Investments Private Limited (“PHIPL”)(formerly known as Boom Realty Private Limited)

During the year under review, the name was changed from Boom Realty Private Limited to Peninsula Holdings and Investments Private Limited. During the year ended 31st March, 2010, PHIPL had incurred a loss of Rs. 5.21 lakhs as against the loss of Rs. 0.03 lakhs for the previous year.

PHIPL is now the Holding Company of 12 Subsidiary Companies (as mentioned above) which were earlier the Subsidiary Companies of Peninsula Land Limited.

City Parks Private Limited (“City Parks”)

City Parks is in the business of development of Real Estate in Pune. During the year ended 31st March, 2010, City Parks had not generated any revenue and incurred loss of Rs. 0.90 lakhs. The corresponding fi gures of revenue and loss for the previous year were Rs. 0.05 lakhs and Rs. 10.48 lakhs.

Inox Mercantile Company Private Limited (“Inox”)

Inox is in the business of Real Estate Development project in Goa. During the year ended 31st March, 2010, Inox had not generated any income and the project expenses were transferred to work in progress.

Peninsula Facility Management Services Limited (“PFMS”)

PFMS is mainly rendering maintenance and housekeeping services to various properties. During the year ended 31st

March, 2010, PFMS earned total revenue of Rs. 1,414.00 lakhs and incurred loss of Rs. 100.74 lakhs as against the total revenue of Rs. 1,514.95 lakhs and loss of Rs. 266.66 lakhs in the previous year.

PFMS was converted in to a Public Limited Company during the year under review.

Peninsula Investment Management Company Limited (“PIMCL”)

PIMCL is rendering mainly investment advisory services. During the year ended 31st March, 2010, PIMCL earned total revenue of Rs. 383.91 lakhs and profi t of Rs. 82.03 lakhs. The corresponding fi gures of total revenue and profi t for the previous year were Rs. 421.89 lakhs and Rs. 37.60 lakhs.

Peninsula Mega Township Developers Private Limited (“PMTDPL”)

PMTDPL is undertaking Real Estate Development project in Nasik. During the year ended 31st March, 2010, PMTDPL had incurred loss of Rs. 0.83 lakhs as against Rs. 0.73 lakhs during the previous period.

Peninsula Pharma Research Centre Private Limited (“PPRCPL”)

PPRCPL is in the business of Real Estate Development at Goa. During the year ended 31st March, 2010, PPRCPL had not generated any revenue as against total revenue of Rs. 1.25 lakhs during the previous year ended 31st March, 2009. The project expenses of PPRCPL were transferred to work in progress.

Peninsula Trustee Limited (“PTL”)

PTL is in the business of managing various Real Estate Funds. During the year ended 31st March, 2010, PTL had earned total revenue of Rs. 4.44 lakhs and profi t of Rs. 1.28 lakhs. The corresponding fi gures of total revenue and profi t for the previous year were Rs. 4.53 lakhs and Rs. 3.51 lakhs.

Planetview Mercantile Company Private Limited (“Planetview”)

Planetview is in the business of Real Estate development project in Goa. During the year ended 31st March, 2010, Planetview had not generated any income and the project expenses were transferred to work in progress.

RR Mega Property Developers Private Limited (“RR Mega Property”)

RR Mega Property is undertaking the Real Estate Development project in Hyderabad. During the year under review, RR Mega Property had not generated any income and the project expenses were transferred to work in progress.

RR Real Estate Development Private Limited (“RR Real Estate”)

During the year ended 31st March, 2010, RR Real Estate earned total revenue of Rs. 143.52 lakhs and incurred loss of Rs. 96.63 lakhs. The corresponding fi gures of total revenue and profi t for the previous year were Rs. 197.40 lakhs and Rs. 4.29 lakhs.

Takenow Property Developers Private Limited (“Takenow”)

During the year ended 31st March, 2010, Takenow had incurred a loss of Rs. 11.20 lakhs as against the loss of Rs. 0.05 lakhs for the previous year.

Renato Finance & Investments Private Limited (“Renato”)

Renato is a registered Non Banking Financial Company with Reserve Bank of India. During the year ended 31st March, 2010, Renato’s total revenue from the fi nancial and investment activities was Rs. 94.33 lakhs as against the previous year’s revenue of Rs. 74.70 lakhs. The profi t after tax for the current year was Rs. 2.58 lakhs as against Rs. 3.25 lakhs for the previous year ended 31st March, 2009.

Peninsula Mega Properties Private Limited (“PMPPL”)

During the year ended 31st March, 2010, PMPPL had incurred a loss of Rs. 0.67 lakhs. The loss for the previous year was Rs. 0.18 lakhs.

Champs Elysee Enterprises Private Limited (“Champs Elysee”)

During the year ended 31st March, 2010, Champs Elysee had incurred a loss of Rs. 0.59 lakhs as against Rs. 0.37 lakhs during the previous year.

11. Fixed Deposits

During the year ended 31st March, 2010, the Company had transferred 3 Fixed Deposits amounting to Rs. 0.30 lakhs to Investor Education and Protection Fund. As on 31st March, 2010, 5 Fixed Deposits amounting to Rs. 0.56 lakhs however remains unclaimed due to lack of instructions from deposit holders.

12. Directors’ Responsibility Statement

Pursuant to Section 217(2AA) of the Companies Act, 1956 (“the Act”), we hereby state that :

i) in the preparation of the annual accounts, the applicable accounting standards have been followed with proper explanation relating to material departures, if any;

ii) your Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2010 and its profi t for the year ended on that date;

iii) your Directors have taken proper and suffi cient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

iv) your Directors have prepared the Annual Accounts for the year ended 31st March, 2010 on a going concern basis.

13. Employee Stock Option Scheme

During the year under review, the Company has not granted any stock options. Disclosures as required by Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 are attached herewith and marked as Annexure A.

14. Group for Inter se Transfer of Shares

As required under Clause 3(1)(e)(i) of the Securities and Exchange Board of India (Substantial Acquisition of Shares and Takeovers) Regulations, 1997, persons constituting group (within the meaning as defi ned in the Monopolies and Restrictive Trade Practices Act, 1969) for the purpose of availing exemption from applicability of the provisions of Regulations 10 to 12 of the aforesaid SEBI Regulations are attached herewith and marked as Annexure B and the said Annexure B forms a part of this Annual Report.

15. Conservation of energy and technology absorption

In view of the nature of activities which are being carried on by the Company, particulars required under the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988, read with Section 217(1)(e) of the Companies Act, 1956, are not applicable.

17. Acknowledgement

The Directors express their deep gratitude and thank the Central and State Governments as well as their respective Departments and Development Authorities connected with the business of the Company, contractors and consultants and also Banks, Financial Institutions and shareholders for their continued support and encouragement.

By Order of the Board Urvi A. Piramal Mumbai: 14th June, 2010 Chairperson

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