Directors Report of RSWM Ltd.

Mar 31, 2018

The Directors present the Annual Report together with the audited Balance Sheet and the Statement of Profit and Loss of RSWM Limited for the year ended March 31, 2018.

Company’s Performance

Your Company''s performance during the year 2017-2018 is summarized below:

Financial Results

(Rs. in Crores)

Turnover	2017-18	2016-17
Export	964.90	917.29
Domestic	1,978.19	2,078.91
Total	2,943.09	2,996.20
Profit before Interest & Depreciation	263.08	357.87
Less: Interest/Finance Cost	117.29	110.36
Profit before Depreciation & Amortisation	145.79	247.51
Less: Depreciation & Amortisation	124.48	132.17
Profit/(Loss) before Tax	21.32	115.34
Less: Current Tax	4.55	24.30
Tax of earlier years provided (written back)	(0.05)	0.11
Deferred Tax Liability	2.32	(10.04)
Profit/(Loss) after Tax	14.50	100.97
Add: Opening Balance	371.95	311.27
Less: Dividends & Others	32.21	40.29
Profit available for appropriation	354.24	371.95

Number of Meetings of the Board

The particulars of the meetings held during the year along with the details regarding the meetings attended by the directors form part of the Corporate Governance Report.

The composition of the Board and its committees has also been given in detail in the report on Corporate Governance.

Dividend and other Appropriations

Your Directors are pleased to recommend a dividend on Equity Shares @ 20% i.e. Rs.2 per Equity Share of Rs.10/- each for the year ended the March 31, 2018.

The proposal for payment of dividend on Equity Shares of the Company will absorb an amount of Rs.5.70 Crore (inclusive of dividend distribution tax).

The proposal with regard to the payment of dividend on Equity Shares for the year ended March 31, 2018 shall be placed before the shareholders at the ensuing Annual General Meeting.

No amount is proposed to be transferred to General Reserve. The amount of Rs. 49.10 crore has been carried over to next year.

Operational Performance

Your Directors inform the members that during the year under review, the operations of the Company stabilised from the aftermath of demonetisation. However, the bigger economic event of implementation of Goods and Service Tax w.e.f July 1, 2017 impacted the overall business sentiments particularly in the 1st half of the Financial Year. Your Company geared itself to face the challenges and made all efforts to continue its operations with full efficiency and vigour.

Despite all the difficulties, your Company recorded a marginal decrease in turnover at Rs.2,943.09 Crores against Rs.2996.20 Crores in the previous year. However, operating profit of the Company declined to Rs.263.08 crore from Rs.357.87 crore recorded in the previous year. Profit before depreciation also declined to Rs.145.79 Crores against Rs.247.51 Crores recorded in the previous year and the profit after tax also decreased to Rs.14.50 Crores against Rs.100.97 Crores in the previous year. Your Directors inform the member that the financial statements of your Company have been drawn on the Ind-AS for the financial year ended March 31, 2018 with comparatives.

Your Company took various steps to overcome the situation which included rationalisation, modernisation and capex programme on need priority basis. Apart from this, the Company enhanced its focus on marketing and value addition to achieve the optimum benefits. Your Company also focused on cost reduction to improve the profitability along with better product mix and improving efficiency. Your Directors inform the members that due to above steps the profitability of the Company improved substantially in the second half of the Financial Year under review. The above measures are expected to result positively in the current Financial Year also.

The analytical review of the Company''s performance and its businesses, including initiatives in the areas of human resources and information technology, have been presented in the section on Management Discussion and Analysis of the Annual Report.

Working results of last three financial years 2015-16 to 201718 are given in Annexure - 1 and form part of this report.

Expansion and Modernization

Your Directors in their previous report had reported about the commissioning of Denim Sheet Dyeing project which resulted in enhancing the production capacity of Denim Fabric to 25 million meters from 17 million meters per annum. However, the full benefits of this expansion could not be realized due to market conditions in the backdrop of GST implementation.

Your Directors had also reported in previous report about the completion of phase-I of debottlenecking and up-gradation of equipments and facilities across various units of the Company. Your Directors had also reported the initiation of phase II of Technology up-gradation & debottlenecking programme to further modernise the facilities and equipments at various units of the Company. Your Directors feel pleasure in informing the members that this programme has been completed during the year at a capital outlay of Rs.42.29 crores. The above programme has resulted in modernising the equipment and facilities across various units of the Company. Your Directors further inform the members that your Company, during the year had installed and operationalised. 3.6 M.W Roof Top Solar Power facility at its Mandpam and Kanyakheri Units which had been built at a total cost of Rs.16.05 crores.

Your Directors inform the members that your Company has outlined further capex of Rs.56.55 crores for modernisation of spinning facility at Ringus unit as well as expansion of capacity of Recycled Polyester Fibre at the same location. This programme is likely to be operational in the current financial year.

Your Directors are hopeful that with the completion of debottlenecking and up-gradation of facilities as well as implementation of new initiatives, the overall productivity and profitability of the Company will improve considerably.

Subsidiary Companies, Joint Ventures & Associates

Your Directors inform the members that during the financial year under review, your Company has no Subsidiary.

During the year under review, your Company continued to receive wind power supply from LNJ Power Ventures Limited. This green power initiative also enables your Company to meet its Renewable Power Obligations. Your Directors further inform the members that during the year its Joint Venture partner M/s Bhilwara Energy Limited exited from the Wind Power business and accordingly M/s Hero Wind Energy Private Limited were inducted as Joint Venture partner in their place.

Further as reported in the previous report, your Company is holding significant investment in Bhilwara Energy Limited and is represented by Shri Riju Jhunjhunwala, Managing Director of your Company on their Board where also he is holding the position of Managing Director. Accordingly, M/s Bhilwara Energy Limited continues to be associate of your Company.

Your Directors inform the members that in line with the emphasis of government on Skill Development, your Company decided to undertake the skill development related activities and accordingly acquired 40.66% stake in the form of subscription of 7,50,000 shares in LNJ Skills & Rozgar Private Limited which is involved in skill development activities. Accordingly, LNJ Skills & Rozgar Private Limited has become associate of your Company.

A statement containing the salient features of the financial statements of LNJ Power Ventures Limited, Bhilwara Energy Limited and LNJ Skills & Rozgar Private Limited in the prescribed format AOC 1 is annexed as Annexure - II.

Contribution to the Exchequer

Your Company has contributed an amount of H 267.55 Crores in terms of taxes and duties to the Exchequer.

Corporate Social Responsibility

Your Directors feel pleasure to inform the members that your Company has been on the forefront to fulfil its obligation towards the society at large and accordingly made its contribution in whole gamut of activities such as sanitation and safe drinking water, eradicating hunger, poverty and malnutrition, ensuring environmental sustainability, ecological balance, protection of national heritage, promotion of rural sports etc. Your Directors in their previous report had informed the members that at the request of State Government of Rajasthan, your Company had undertaken to build the damaged wall of Check Dam at Beneshwar near Mordi, Banswara. Your Directors feel pleasure to inform the members that during the year under review an amount of H99.37 lakhs was spent towards this project. Your Company also sponsored for Rajasthan Heritage Development Project. An amount of H10 lakhs was incurred towards this. These activities were besides the other activities undertaken by the Company from time to time.

Your Directors inform the members that the Corporate Social Responsibility Committee comprising of Shri Arun Churiwal, Shri Riju Jhunjhunwala and Shri Amar Nath Choudhary monitors the expenditure incurred on the CSR activities and formulate an annual budget for these activities. Your Directors also review the progress periodically.

The details of the CSR spend by the Company are annexed as Annexure III forming part of this report.

Energy Conservation, Technology Absorption and Foreign Exchange Earnings and Outgo

Your Directors inform the members that your Company continuously looks out for energy conservation measures in all areas of operation across its various units. Similarly, your Company endeavours to lookout for up-gradation and absorption of technology. Your Company also spends continuously on Research and Development. Your Directors are glad to inform the members that your Company is a net foreign exchange earner. The relevant detail as required to be disclosed with respect to Energy Conservation, Technology Absorption and Foreign Exchange Earnings and Outgo pursuant to Section 134(3) (m) of the Companies Act, 2013 read with the Rule 8(3) of the Companies (Accounts) Rules, 2014 are given in Annexure - IV forming part of this report.

Extract of Annual Return

Pursuant to Section 92 of the Companies Act, 2013 read with Rule 12 of The Companies (Management and Administration) Rules, 2014, the extract of Annual Return in prescribed format MGT-9 is annexed as Annexure - V.

Directors & Key Managerial Personnel

Shri Ravi Jhunjhunwala and Shri Arun Churiwal, Directors retire by rotation and being eligible offer themselves for reappointment.

During the financial year under review, Smt. Geeta Mathur, Independent Woman Director resigned from the Board with effect from 9th November, 2017 due to her time commitments. Further, Shri Prakash Maheshwari, Executive Director also resigned from the Board with effect from 31st March, 2018 due to completion of his term. Your Directors place on record their appreciation for the services rendered by Smt. Geeta Mathur and Shri Prakash Maheshwari during their tenure on the Board.

Your Directors further inform the members that Smt. Archana Capoor was co-opted on the Board as an Additional Director in the category of Independent Director with effect from 13th February, 2018. Smt. Archana Capoor brings with her vast experience in the field of Finance and Market Research. Your Directors further inform the members that the term of Shri Priya Shankar Dasgupta as Independent Director is due for completion on 15th September, 2018. Your Directors upon commendation of Nomination and Remuneration Committee proposed to reappoint Shri Priya Shankar Dasgupta for the second term of 5 years w.e.f 16th September, 2018. The proposal for confirmation of appointment of Smt Archana Capoor and re-appointment of Shri Priya Shankar Dasgupta as Independent Director(s) for a term of 5 years shall be put up before the ensuing Annual General Meeting.

Your Directors further inform the members that declarations have been taken from the Independent Directors at the beginning of the financial year stating that they meet the criteria of independence as specified under sub-section (6) of Section 149 of the Companies Act, 2013 and Regulation 16(1)(b) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

During the year, Shri Riju Jhunjhunwala, Managing Director & CEO, Shri Surender Gupta, Company Secretary and Shri B.M. Sharma, Chief Financial Officer acted as Key Managerial Personnel.

Directors’ Appointment and Remuneration Policy

As your Directors informed the members in their previous report, a Nomination and Remuneration Policy had been framed by your Company for the appointment of Directors and Senior Management and fixation of their remuneration. The Nomination and Remuneration Policy as framed is annexed as Annexure VI and forms part of this report.

Your Directors inform the members that the Nomination and Remuneration Committee as well your Directors endeavour to follow the policy and all appointments at Board and Senior Management are considered at the meetings of the Committee and the Board.

Annual Evaluation by the Board

Your Board of Directors, during the financial year under review, carried out annual evaluation of its own performance as well as its Committees and also of the individual Directors in the manner as enumerated in the Nomination and Remuneration Policy in accordance with the provisions of Companies Act, 2013 and SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. Your Directors feel pleasure in informing the members that the performance of the Board as a whole and its members individually was adjudged satisfactory.

Particulars of Loans, Guarantees or Investments

Details of Loans, Guarantees and Investments are given in the Notes to the Financial Statements at appropriate places.

Particulars of Contracts or Arrangements with Related Parties

All contracts/ arrangements/ transactions entered into by the Company during the financial year with the related parties are on arm''s length basis and in the ordinary course of business. During the financial year, there was no material contracts or arrangements entered into by the Company with any of the related party. Your Directors draw attention of the members to Note No.39 to the financial statements, which contain particulars with respect to related parties. The policy on dealing with the related party transactions as approved by the Board of Directors is disclosed on the website of the Company under the following link

http://www.rswm.in/wp-content/themes/rswm/template- investors/pdf/various-policies/Related_Party_Transaction_Policy-2018.pdf

Significant and Material Orders Passed by the Regulators or Courts

During the year under review, there were no significant and materials orders passed by the Regulators or Courts.

Risk Management Policy

The Company has adopted the risk management policy which aimed at creating and protecting shareholders value by minimizing threats and losses and identifying and maximizing opportunities. Your Directors periodically review the risks associated with the business or which threaten the prospects of the Company.

Internal Control Systems

Your Directors inform the members that your Company has put in place strong internal control systems commensurating with the size of the Company. Further, your Directors take utmost care to ensure that all assets are properly safeguarded and reliable information is provided to the management. Your Directors endeavour to inform the member that all the obligations of the Company are properly adhered to.

Your Directors place utmost importance on continuous strengthening of internal control systems. As reported in the previous report, your Company has put in place a system whereby all areas of the operations of the Company are reviewed by the internal as well as external professionals and independent audit firms. Your Company takes adequate measures with respect to gaps, if any, reported. The Audit Committee of your Company regularly monitors the annual operating plans, risk assessment and minimization procedures as well as mitigation plans.

Your Directors endeavour to continuously improve and monitor the internal control systems.

Particulars of Employees

The information pursuant to Section 197 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, of the employees is annexed as Annexure -VII.

Further, pursuant to Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the relevant statement is annexed as Annexure - VIII.

Auditors

Statutory Auditors

During the year under review, M/s S. Bhargava Associates, Chartered Accountant (Firm Registration No 003191C), Joint Statutory Auditors of the Company retired at the conclusion of the 56th Annual General Meeting as they became ineligible for re-appointment pursuant to Section 139 of the Companies Act, 2013 and rules made thereunder. M/s S. Bhargava & Associates rendered their services over the years and your Board places on record its appreciation of their services as Joint Statutory Auditors of the Company.

M/s Lodha & Co, Chartered Accountants (Firm Registration No.301051E), were appointed as Joint Statutory Auditors of the Company at the 56th Annual General Meeting of the Company held on 27th September, 2017 for a term of 5 years till the conclusion of 61st Annual General Meeting subject to ratification by members at every subsequent Annual General Meeting.

Further, M/s S. S. Kothari Mehta & Co., Chartered Accountants (Firm Registration No.000756N), Joint Statutory Auditors of the Company, were appointed at the 53rd Annual General Meeting of the Company held on September 16, 2014 for a term of 5 years till the conclusion of 58th Annual General Meeting subject to ratification by members at every subsequent Annual General Meeting.

Your Directors inform the members that in accordance with the amendment notified by MCA on 7th May, 2018, the requirement of ratification of the appointment of Statutory Auditors at every Annual General Meeting has been omitted and is no longer required. Accordingly, the notice convening the ensuing Annual General Meeting does not carry resolutions with regard to ratification of appointment of Statutory Auditors.

However, both the Statutory Auditors have confirmed their eligibility under Section 141 of the Companies Act, 2013 and the Rules framed thereunder.

The observations of the Auditors, if any, are explained wherever necessary, in the appropriate notes to the accounts. The Auditors'' Report does not contain qualification, reservation or adverse remark.

Internal Auditors

Your Directors, during the year under review, appointed M/s. P. K. Deora & Co., Chartered Accountants (Firm Registration No.004167N), M/s. BGJC & Associates LLP, Chartered Accountants (Firm Registration No.003304N) and M/s. ASM Bhargava & Co., Chartered Accountants (Firm Registration No.019378C) to act as the Internal Auditors of the Company for the financial year 201718 pursuant to Section 138 of the Companies Act, 2013 read with The Companies (Accounts) Rules, 2014.

Secretarial Auditor

Your Directors, during the year under review, also appointed Shri Mahesh Gupta, Practicing Company Secretary (Membership No. FCS 2870 and CP No.1999) Proprietor of M/s Mahesh Gupta & Company, Company Secretaries, Delhi as the Secretarial Auditor of the Company for the financial year 2017-18 pursuant to Section 204 of the Companies Act, 2013 read with The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. The Report of Secretarial Audit is annexed as Annexure IX.

Cost Auditor

Your Directors inform the Members that pursuant to Section 148 of the Companies Act, 2013 read with The Companies (Cost Records and Audit) Rules, 2014, Textile Companies are required to get their cost records audited. In this connection, the Board of Directors of the Company on the commendation of Audit Committee had approved the appointment of M/s. N. D. Birla & Company, Cost Accountants, (Firm Registration No. 000028), Ahmedabad as the Cost Auditor of the Company for the year ending March 31, 2018.

Corporate Governance

Report on Corporate Governance along with the Certificate of Auditors M/s. S. S. Kothari Mehta & Co., Chartered Accountants (Firm Registration No 000756N), Plot No-68, Okhla Industrial Area, Phase III, New Delhi -110020 and M/s. Lodha & Co., Chartered Accountants (Firm Registration No.301051E), 12, Bhagat Singh Marg, New Delhi - 110 001 confirming compliance to conditions of Corporate Governance as stipulated under SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, form part of the Annual Report.

Whistle Blower Policy

Your Directors inform the Members that with the objective of pursuing the business in a fair and transparent manner by adopting the highest standards of professionalism, honesty, integrity and ethical behavior and to encourage and protect the employees who wish to raise and report their genuine concerns about any unethical behavior, actual or suspected fraud or violation of Company''s Code of Conduct, the Company has adopted a Whistle Blower Policy. Policy adopted by the Company contains a framework whereby the identity of the complainant is not disclosed. The policy has been disclosed on the website of the Company, the link of which is given hereunder:

http://www.rswm.in/wp-content/themes/rswm/template- investors/pdf/various-policies/RSWM-Whistle-Blower-Policy-2018.pdf

Management Discussion and Analysis Report

Management Discussion and Analysis Report as required by SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, forms part of the Annual Report.

Directors’ Responsibility Statement.

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

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

(b) they 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) they 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) they had prepared the annual accounts on a going concern basis; and

(e) they had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively.

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

Acknowledgements

Your Directors take this opportunity to thank customers, members, suppliers, bankers, business partners / associates, Central and State Governments for their consistent support and co-operation extended to the Company. We also acknowledge the significant contribution made by the employees by their dedication and hard work and trust reposed on us. We look forward to have the same support in our endeavour to help the Company to grow faster.

For and on behalf of the Board

Ravi Jhunjhunwala

Chairman DIN - 00060972

Place: Noida (U.P)

Date: May 10, 2018

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Mar 31, 2015

Dear member

The Directors present the Annual Report together with the audited Balance Sheet and the Statement of Profit and Loss of RSWM Limited for the year ended 31st March, 2015.

Company's Performance

Your Company's performance during the year 2014- 2015 is summarized below:

Financial Results (Rs. in Crore)

2014-15 2013-14

Turnover

Export 1,024.94 922.56

Domestic 1,989.37 1,961.76

TOTAL 3,014.31 2,884.32

Profit before Interest & Depreciation 377.45 388.78

Less: Interest (125.22) (121.76)

Profit before Depreciation 252.23 267.02

Less: Depreciation (135.27) (1 10.69)

Profit/(Loss) before Tax 116.96 156.33

Less: Current Tax (24.50) (34.07)

Deferred Tax Liability (7.55) (23.46)

Profit/(Loss) after Tax 84.91 98.80

Add: Opening Balance 165.24 110.17

Profit available for appropriation 250.15 208.97

Number of meetings of the board

The particulars of the meetings held during the year along with the details regarding the meetings attended by the directors form part of the Corporate Governance Report.

The composition of the Board and its committees has also been given in detail in the report on Corporate Governance.

Dividend and other appropriations

Your Directors are pleased to recommend a dividend @100% i.e. Rs.10/-per Equity Share of Rs.10/- each for the year ended the 31st March, 2015. This will absorb an amount of Rs.27.78 crore (inclusive of distribution tax). A proposal for confirmation of the dividend for the year ended 31st March, 2015 will be placed before the shareholders at the ensuing Annual General Meeting.

No amount is proposed to be transferred to General Reserve. The amount of Rs. 204.99 crore has been carried over to the next year.

Operational performance

Your Directors inform the members that the operational performance of the Company include the financial performance of the operations of M/s. Cheslind Textiles Ltd. which had since merged with the Company vide orders of the Hon'ble High Court of Rajasthan at Jodhpur and also the Hon'ble High Court of Madras at Chennai. Your Directors are pleased to inform the members that during the year under review, your Company recorded consistent performance vis-a-vis the previous year. The Company maintained its performance despite absorbing higher depreciation charges on account of various expansions which were completed during the year under review. The improved sentiments in the global markets also helped the Company to achieve the better performance. However, the profits of the Company were impacted on account of absorbing of losses and unabsorbed depreciation of erstwhile Cheslind Textiles Limited.

The Company registered increase of 4.51% in its gross turnover from Rs. 2884.32 crore in 2013-14 to Rs. 3014.31 crore in 2014-15. The Domestic turnover also registered increase at Rs. 1,989.37 crore in 2014-15 as against Rs. 1961.76 crore in 2013-14 whereas Export turnover increased to Rs. 1,024.94 crore in 2014-15 from Rs.922.56 crore in the previous year. The analytical reviews of the Company's performance and its businesses, including initiatives in the areas of human resources and information technology, have been presented in the section on Management Discussion and Analysis of the Annual Report.

Working results of last three financial years 2012-13 to 2014- 15 are given in Annexure - 1 and form part of this report.

Expansion and modernisation

Your Directors feel great pleasure in informing the members about the completion of its expansion projects involving setting up of 25,344 spindles for melange yarn at Kanya Kheri, Bhilwara which will be commission shortly. Further, 50MT Green Polyester Fibre Project at Ringas and installation of 50 looms at Mordi, Banswara Unit have already been commissioned. Your Directors informed the members that the full benefits of these expansions would be reaped in the current financial year with the full working of these expansions.

Your Directors inform the members that the capex proposal for modernization of fabric division amounting to Rs.3.17 crore and the modernization of Bagalur Unit of erstwhile Cheslind Textiles Limited amounting to Rs. 10 crore are being under implementation which would be helpful in enhancing the overall profitability of the Company.

Your Directors, with the completion of above expansion programmes, are in the process of firming up new initiatives, once the above expansion programmes are fully stabilized.

Subsidiary company and joint venture

Your Directors in their previous report had informed the members about the Scheme of Amalgamation of M/s. Cheslind Textiles Limited, subsidiary of your Company. Your Directors informed the members that your Company obtained all the regulatory approvals as well as the approval of Shareholders and Creditors of the Company during the period under review. Yours Directors gladly inform the members that the Hon'ble High Court of Rajasthan at Jodhpur sanctioned the Scheme of Amalgamation on 26th March, 2015 and subsequently the Hon'ble High Court of Madras at Chennai also sanctioned the scheme on 31st March, 2015 which became effective with the filing of the orders of the respective High Courts with the Registrar of Companies.

Your Directors informed the members that, accordingly financial statements of the Company have been drawn taking into account the operations of merged entity viz. erstwhile Cheslind Textiles Limited.

Your Directors are hopeful that, with the combined operations of the Company, all the objectives of Scheme of Amalgamation would be achieved in due course.

Your Directors also gladly inform the members that, during the year under review, your Company continuously received wind power supply from LNJ Power Ventures Ltd. which was set up as a Joint Venture Company to supply power to the Company under a Power Purchase Agreement for 20 years at fixed rate. This has also enabled the Company for meeting its Renewable Power obligations as per Rajasthan Electricity Regulatory Commission's guidelines.

A statement containing the salient features of the financial statements of LNJ Power Ventures in the prescribed format AOC-1 is annexed as Annexure-II.

Contribution to the exchequer

Your Company has contributed an amount of Rs. 102.07 crore in terms of taxes and duties to the Exchequer.

Corporate social responsibility

Corporate Social Responsibility (CSR) had been the core philosophy of the Company since its existence spanning over five decades. For your Company, it is a continuous process wherein the focus is being given on creating new opportunities, providing education, helping the people in various ways and make them self reliant.

With the Corporate Social Responsibility now becoming the statutory obligation, your Directors had during the year under review, formally constituted a Corporate Social Responsibility Committee comprising of Shri Arun Churiwal, Shri Riju Jhunjhunwala and Shri Amar Nath Choudhary. Your Directors, upon recommendation of the CSR Committee, adopted CSR Policy during the year and initiated the implementation.

The detail of the CSR spend by the Company is enclosed as Annexure - III forming part of this report.

Directors' responsibility statement

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

* in the preparation of the Annual Accounts, the applicable Accounting Standards have been followed and no material departures have been made from the same;

* appropriate Accounting Policies have been selected and applied consistently and they have 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 on 31st March, 2015 and of the Profit and Loss of the Company for the year ended on that date;

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

* the Annual Accounts have been prepared on a going concern basis.

* that proper internal financial controls were in place and that the financial controls were adequate and were operating effectively.

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

Energy conservation, technology absorption and foreign exchange earnings and outgo

The information required to be disclosed pursuant to Section 134(3) (m) of the Companies Act, 2013 read with the Rules, 8(3) of the Companies (Accounts) Rules, 2014 is given in Annexure - IV forming part of this Report.

Extract of annual return

Pursuant to section 92 of the companies Act, 2013 read with Rule 12 of The Companies (Management and administration) Rules, 2014, the Extract of Annual Return in prescribed format MGT-9 is annexed as annexure - V.

Directors & Key Managerial Personnel

Your Directors in their previous report informed the members about the resignation of Shri L. N. Jhunjhunwala, Chairman- Emeritus and the founder of the Company as well as the Group from the directorship of the Company. Your Directors had also informed the members that Shri L. N. Jhunjhunwala upon the unanimous request of the Board of Directors had agreed to continue as Chairman-Emeritus. Your Directors are utmost thankful to Shri L. N. Jhunjhunwala for his continuous guidance to them and the Company.

Shri Ravi Jhunjhunwala and Shri Arun Churiwal, Directors retire by rotation and being eligible offer themselves for re- appointment.

As informed to the members in the previous report by your Directors, Dr. Kamal Gupta, Shri D. N. Davar, Shri Amar Nath Choudhary and Shri Sushil Jhunjhunwala, Independent Directors were appointed for a term of 5 years by the Shareholders at the last Annual General Meeting held on the 16th September, 2014. Shri P. S. Dasgupta, Independent Director was also appointed for a term of 4 years at the same Annual General Meeting.

During the period under review, EXIM Bank has withdrawn its nomination of Shri T. G. Regunathan as its Nominee-Director on the Board of Directors of the Company. The Board places on record its deep appreciation for the services rendered by Shri T. G. Regunathan during his tenure.

Your Directors further inform the members that, during the year under review, Smt. Geeta Mathur was appointed as an Additional Director in the category of Independent Director. Smt. Geeta Mathur brings with her vast experience in the field of Banking and Finance. Your Directors take this opportunity to welcome Smt. Geeta Mathur on the Board of Directors. The proposal for confirmation of her appointment as an Additional Director as well as Independent Director for a term of 5 years shall be put up before the ensuing Annual General Meeting.

Your Directors further inform that, during the year under review, Shri J. C. Laddha was re-appointed as Executive Director till 31st March, 2015 after the expiry of his term on 31st December, 2014. However considering his experience and contributions towards the Company, your Directors requested Shri J. C. Laddha to continue as Non- Executive and Non-Independent Director w.e.f. 1st April, 2015 which was accepted by him. Further, your Directors taking into consideration the succession planning at the top Management of the Company, reappointed Shri Arun Churiwal, whose term was due to expire on the 16th March, 2015 as the Managing Director of the Company for a period upto the 31st March, 2016. Shri Riju Jhunjhunwala was also re-designated as Managing Director w.e.f. 10th February, 2015 for his remaining tenure upto the 30th April, 2016.

Your Directors further inform the members that declarations has been taken from the Independent Directors at the beginning of the financial year stating that they meet the criteria of independence as specified under sub-section (6) of Section 149 of Companies Act, 2013 and Clause 49 of the Listing Agreement with the Stock Exchanges.

During the year, Shri Arun Churiwal, Managing Director of the Company, Shri Surender Gupta, Company Secretary of the Company and Shri B. M. Sharma, Chief Financial Officer of the Company were designated as Key Managerial Personnel.

Directors' appointment and remuneration policy

Pursuant to the provision of Section 178 of the Companies act, 2013 and Clause 49 of the Listing Agreement the Board of Directors on the recommendation of Nomination and Remuneration Committee has framed a policy for the appointment of Directors and Senior Management and their remuneration. The policy forms part of the Board Report and is annexed as Annexure VI.

Annual evaluation by the board

Pursuant to the provisions of the Companies Act, 2013 and Clause 49 of the Listing agreement, the annual evaluation has been made by the Board of its own performance, its committees and the individual directors. The manner of evaluation is mentioned in the Nomination and Remuneration policy which forms part of Board Report.

Particulars of loans, guarantees or investments

Details of loans, Guarantees and Investments are given in the notes to the Financial Statements at appropriate places.

Particulars of contracts or arrangements with related parties

All contracts/ arrangements/ transactions entered into by the Company during the financial year with the related parties are on arm's length basis and in the ordinary course of business. During the financial year, there was no material contracts or arrangements entered into by the Company with any of the related party. Your Directors draw attention of the members to note 41 to the financial statement which contain particulars with respect to related parties. The policy on dealing with the related party transactions as approved by the Board of Directors is disclosed on the website of the Company under the following link:

http://www.rswm.in/pdf/Policy_on_Related_Party_ Transaction.pdf

Significant and material orders passed by the regulators or courts

During the year under review, the Hon'ble High Court of Rajasthan at Jodhpur has approved the merger of Cheslind Textiles Limited with the Company vide its order dated 26th March, 2015.

Further, the Hon'ble High Court of Rajasthan at Jodhpur dismissed the petition challenging constitutional validity of Entry Tax vide its order dated 11th December 2014.For details in this regard, the shareholders can refer to note no 31 in the notes on accounts.

Risk management policy

The Company has adopted the risk management policy which aimed at creating and protecting shareholders value by minimizing threats and losses and identifying and maximizing opportunities. Your Directors periodically review the risks associated with the business or which threaten the prospects of the Company.

Internal control systems

Your Company is having adequate internal control systems to ensure that all the assets are properly safeguarded, that the information provided to the management is reliable; all the obligations of the Company are properly adhered to.

Your Directors also assess opportunities for improvement in systems and controls and provide value added services to the organization after it is reviewed by the Audit Committee and the Board. The up-gradation of ERP is made at regular interval to ensure the reliability of financial and other information. The annual operating plan is submitted to the Audit Committee for review and concurrence and the findings of internal audit are reported to the Audit Committee on quarterly basis. The Audit Committee then addresses the significant issues raised by the auditors. With the diversification of portfolio of the Company, the risk associated with the business also gets diversified. In order to minimize the risks your Company believes in strengthening the internal control system to continuously monitor the business of the Company.

Particulars of employees

The information pursuant to Section 197 read with Rule 5 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, of the employees is annexed as Annexure - VII

Further pursuant to Rule 5 (2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the relevant statement is annexed as Annexure - VIII.

Auditors

Statutory Auditors

The Company's Auditors M/s. S. Bhargava Associates, Chartered Accountants (Firm Registration No. 003191C) and M/s. S. S. Kothari Mehta & Co., Chartered Accountants (Firm Registration No. 000756N) who retires at the conclusion of the ensuing Annual General Meeting, are eligible for re- appointment. Further, they have confirmed their eligibility under Section 141 of the Companies Act, 2013 and the Rules framed thereunder.

Internal Auditors

Your Directors, during the year under review, appointed M/s. P. K. Deora & Co., Chartered Accountants (Firm Reg. No. 004167N), M/s. Doogar & Associates, Chartered Accountant (Firm Reg. No. 000561N) and M/s. SSMS & Associates, Chartered Accountants (Firm Reg. No. 019351C) to act as the Internal Auditors of the Company for the financial year 2014-15, pursuant to Section 138 of the Companies Act, 2013 read with The Companies (Accounts) Rules, 2014,

Secretarial Auditor

Your Directors, during the year under review, also appointed Shri Mahesh Gupta, Practicing Company Secretary (Membership No. FCS 2870 and CP No.1999) Proprietor of M/s Mahesh Gupta & Company, Company Secretaries, Delhi as the Secretarial Auditor of the Company for the financial year 2014-15, pursuant to Section 204 of the Companies Act, 2013 read with The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014. The Report of Secretarial Audit is annexed as Annexure IX.

Cost Auditor

Your Directors inform the members that Pursuant to Section 148 of the Companies Act, 2013 read with The Companies (Cost Records and Audit) Rules, 2014 and Notification issued by Ministry of Corporate Affairs dated 31st December, 2014, the textile Companies were notified to get its cost records audited from the financial year commencing on or after 1st day of April, 2015. Accordingly your Directors appointed M/s N D Birla & Company, Cost Accountants, Ahmedabad, (Firm Reg. No. 000028) as the Cost Auditor of the Company.

Corporate governance

Report on Corporate Governance along with the Certificate of Auditors M/s S. Bhargava Associates, Chartered Accountants (Firm Registration No. 003191C), 1, Pareek College Road, Bani Park, Jaipur (Rajasthan) and M/s. S. S. Kothari Mehta & Co., Chartered Accountants (Firm Registration No 000756N), 146-149, Tribhuvan Complex, Ishwar Nagar, Mathura Road, New Delhi-110065, confirming compliance to conditions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement, form part of the Annual Report.

Whistle blower policy

Your Directors inform the members that with the objective of pursuing the business in a fair and transparent manner by adopting the highest standards of professionalism, honesty, integrity and ethical behavior and to encourage and protect the employees who wish to raise and report their genuine concerns about any unethical behavior, actual or suspected fraud or violation of Company's Code of Conduct, the Company has adopted a Whistle Blower Policy. The Policy adopted by the Company contains a framework whereby the identity of the complainant is not disclosed. The policy has been disclosed on the website of the Company, the link of which is given hereunder:

http://www.rswm.in/pdf/whistle_blower_policy.pdf

Management discussion and analysis report

Management discussion and analysis report, as required by Clause 49 of Listing Agreement, forms part of the Annual Report.

Acknowledgements

Your Directors take this opportunity to thank Customers, members, suppliers, bankers, business partners / associates, Central and State Governments for their consistent support and co-operation extended to the Company. We also acknowledge the significant contribution made by the employees for their dedication and hard work and trust reposed on us. We look forward to have the same support in our endeavor to help the Company to grow faster.

For and on behalf of the Board

RAVI JHUNJHUNWALA Place: Kharigram (Rajasthan) Chairman Date: 8th May, 2015 DIN - 00060972

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Mar 31, 2014

The Directors present the Annual Report together with the audited Balance Sheet and the Statement of Profit and Loss of RSWM Limited for the year ended 31st March, 2014.

Companies Performance

Your Companies performance during the year 2013-2014 is summarised below:

Financial Results

(Rs. in Crore)

2013-14 2012-13 Turnover

Export 922.56 720.19

Domestic 1961.76 1750.85

Total 2884.32 2471.04

Profit before Interest & Depreciation 388.78 331.17

Less: Interest (121.76) (121.29)

Profit before Depreciation 267.02 209.88

Less: Depreciation (110.69) (108.45)

Profit/(Loss) before Tax 156.33 101.43

Less: Current Tax (34.07) (20.26)

Deferred Tax Liability (23.46) (13.30)

Profit/(Loss) after Tax 98.80 67.87

Add: Opening Balance 110.17 76.19

Profit available for appropriation 208.97 144.06

Dividend and Other Appropriations

From the amount available for appropriation, Rs. 9.88 crore is proposed to be transferred to General Reserve.

Your Directors are pleased to recommend a dividend @ 125% i.e. Rs. 12.50 per Equity Share of Rs. 10/- each for the year ended the 31st March, 2014. This will absorb an amount of Rs. 33.85 crore (inclusive of distribution tax). A proposal for confirmation of the dividend for the year ended 31st March, 2014 will be placed before the shareholders at the ensuing Annual General Meeting.

The balance amount of Rs. 165.24 crore has been carried over to next year.

Operational Performance

Your Directors are pleased to inform the members that during the year under review, your Company continued to march ahead and reported a record performance on the strength of its strong presence in the domestic and export markets. Your Company continued to work on new initiatives and continuous improvements in the product-mix, penetration in marketing strategy, economic cost of production. The Company also reaped the advantages of continuous expansions undertaken in the past few years. The Company also gained from the partial recovery in the US and the Euro Zone economics.

The Company registered increase of 16.72% in its gross turnover from Rs. 2,471.04 crore in 2012-13 to Rs. 2884.32 crore in 2013-14. The Export turnover also registered increase at Rs. 922.56 crore in 2013-14 as against Rs. 720.19 crore in 2012-13 whereas Domestic turnover increased to Rs. 1961.76 crore in 2013-14 from Rs. 1750.85 crore in the previous year. The analytical reviews of the Company''s performance and its businesses, including initiatives in the areas of human resources and information technology, have been presented in the section on Management Discussion and Analysis of the Annual Report.

Working results of last three financial years 2011-12 to 2013-14 are given in Annexure – 1 and form part of this report.

Expansion and Modernisation

Your Directors in their previous report had mentioned about the completion of the expansion programme comprising of 51840 spindles at the Kharigram Unit and setting up spinning facility at Denim Unit at a capital outlay of Rs. 355 crore. Your Directors are glad to inform the members that during the year under review the Company reaped the full benefits of above expansion and the growth in the turnover and profitability of the Company had been partially on account of the above

expansion. Your Directors also inform the members that the Company also completed the up-gradation programme of Effluent Treatment Plant (ETP) at the Kharigram, Ringas, Denim and TPP Plants and Sewerage Treatment Plant (STP) as per schedule. Your Directors are pleased to inform the members that encouraged by the performance of the Company due to above, your Directors chalked out a further expansion programme involving a capital outlay of Rs. 343.50 crore comprising of setting up of 25000 spindles for Melange Yarn at Mandpam Unit, setting up of 50MT capacity Green Polyester Fibre Project at Ringas and installation of 50 looms at Mordi, Banswara Unit. Your Directors are pleased to inform the members that the implementation of the above expansion programme has started and likely to be completed during the current financial year. Your Directors are hopeful that the above expansions will lead to significant growth in the turnover and profitability of the Company.

Your Directors believe that the above stated expansion programme will lead to the Company in the direction to achieve the targets laid down in pursuant of the ''Lakshya 2016'' programme with a targeted turnover of Rs. 4500 crore and involving a capex of Rs. 1500 crore in stages to be achieved by 2016.

Subsidiary Company and Joint Venture

Your Directors in their previous report had mentioned about the implementation of CDR scheme by Cheslind Textiles Limited (CTL), subsidiary of your Company which had resulted in improvement of performance of CTL. Your Directors now inform the members that the Board of Directors of your Company, during the year under review, approved the amalgamation of CTL into your Company to achieve the benefits of combined operations and reduce the operating costs which upon implementation, subject to requisite approvals, will further boost the profitability of the Company.

Your Directors further approved at their meeting held on 9th April, 2014-, a Scheme of Amalgamation (SOA) subject to the approval of members, creditors and other regulatory authorities as may be required in that regard. The SOA has also been approved by the Board of Directors of CTL and shall be subject to approval by its shareholders and creditors and shall be subject to regulatory clearance as may be required.

Your Directors also gladly inform the members that, during the year under review, your Company continuously received wind power supply from LNJ Power Ventures Ltd. which was set up as a Joint Venture Company to supply power to the Company under a Power Purchase Agreement for 20 years at fixed rate. This has also enabled the Company for meeting its Renewable Power obligations as per Rajasthan Electricity Regulatory Commission''s guidelines.

A Statement of particulars of Cheslind Textiles Limited subsidiary of the Company is part of the Annual Report. In compliance with Clause 32 of Listing Agreement, audited consolidated financial statements also form part of this Annual Report.

Contribution to the Exchequer

Your Company has contributed an amount of Rs. 113.83 crore in terms of taxes and duties to the Exchequer

Corporate Social Responsibility

Corporate Social Responsibility (CSR) is considered to be the core area of business as the growth of the Company derives from both the Management decisions and CSR activities. For your Company, its a continuous process wherein the focus is being given on creating new opportunities, providing education, helping the people in various ways and make them self-reliant etc. Driven by its belief, Your Company apart from removing the difficulties believes in eradicating the root cause of the problems. In the area of education, the Company focus on providing the delivery of quality education. The Key highlights of the CSR activities undertaken by the Company are given separately.

Directors'' Responsibility Statement

Pursuant to Section 217(2AA) of the Companies Act, 1956, the Directors state that:

t in the preparation of the Annual Accounts, the applicable Accounting Standards have been followed and no material departures have been made from the same

t appropriate Accounting Policies have been selected and applied consistently and they have 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 on 31st March, 2014 and of the Profit and Loss of the Company for the year ended on that date

t proper and sufficient care has been taken 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 * the Annual Accounts have been prepared on a going concern basis.

Energy Conservation, Technology Absorption And Foreign Exchange Earnings and Outgo

The information required to be disclosed pursuant to Section 217(1)(e) of the Companies Act, 1956 read with Companies (Disclosure of Particulars in the report of Board of Directors) Rules, 1988, is given in Annexure -II forming part of this Report.

Directors

Your Directors inform the members that Shri L.N. Jhunjhunwala, Chairman-Emeritus and the founder of the Group expressed his desire vide his letter dated 21st April, 2014 to relinquish the office of Director, so to devote his time to philanthropic activities where he has been deeply involved for a long time. Your Directors respecting his desire accepted the request to resign from the Board but urged upon him in all earnestness to continue as the Chairman -Emeritus, which he has very kindly accepted. Your Directors honour and taken pride in the contribution of Shri L.N. Jhunjhunwala since the nception of the Company and his unparallel efforts over last five decades to bring the Company to its present position.

Shri Shekhar Agarwal, Director retire by rotation and being eligible offer himself for reappointment.

Your Directors further inform the members that in accordance with the provisions of the Companies Act, 2013, and clause 49 of the listing agreement as per SEBI Circular dated 17th April, 2014, the Company is required to appoint the Independent Directors on the Board to hold office for the term of five consecutive years on the Board of the Company and such independent directors shall not be liable to retire by rotation.

Dr. Kamal Gupta, Shri D.N. Davar, Shri Amar Nath Choudhary and Shri Sushil Jhunjhunwala have been serving the Board for more than five years. Therefore, it is proposed to appoint all of them as Independent Directors for one more term of five consecutive years commencing from ensuing Annual General Meeting.

Shri P.S. Dasgupta was appointed as Independent Director in Annual General Meeting held in 2013. Therefore, it is proposed to appoint him as Independent Director for first term of four consecutive years commencing from ensuing Annual General Meeting.

Internal Control Systems

Your Company is having adequate internal control systems to ensure that all the assets are properly safeguarded, that the information provided to the management is reliable, all the obligations of the Company are properly adhered to.

The upgradation of ERP is made at regular interval to ensure the reliability of financial and other information. The audit plan is submitted to the Audit Committee for review and concurrence and the result of internal audit are reported to the Audit Committee on quarterly basis. The Audit Committee then addresses the significant issue raised by the auditors. As the portfolio of the Company is getting diversified, your Company believes in strengthening the internal control system to continuously monitor the business of the Company.

Particulars of employees

Statement of particulars of Employees as required to be furnished pursuant to Section 217(2A) of Companies Act, 1956 read with Companies (Particulars of Employees) Rules, 1975 is attached hereto and is given in Annexure-III forming part of this Report.

Auditors

The Company''s Auditors M/s. S. Bhargava Associates and M/s. A. L. Chechani & Co., retire at the conclusion of the ensuing Annual General Meeting. M/s. A. L. Chechani & Co., has expressed the desire not to continue as Statutory Auditor of the Company after the ensuing Annual General Meeting. Therefore, the Board of Directors recommends to appoint M/s. S. Bhargava Associates along with M/s S S Kothari Mehta & Co. as the Joint Auditors in the ensuing Annual General Meeting.

M/s A. L. Chechani & Co. has rendered the service in exemplary ways over the decades as Joint auditors and maintained high standard and quality in their work. The Board places on record its appreciation for the services rendered by them as joint Statutory Auditors of the Company.

Corporate Governance

Report on Corporate Governance along with the Certificate of Auditors M/s S. Bhargava Associates, Chartered Accountants, 1, Pareek College Road, Bani Park, Jaipur (Rajasthan) & M/s. A. L. Chechani & Co., Chartered Accountants, 17 Heera Panna Market, Pur Road, Bhilwara (Rajasthan) confirming compliance to conditions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement, form part of the Annual Report.

Acknowledgements

Your Directors take this opportunity to thank Customers, members, suppliers, bankers, business partners / associates, Central and State Governments for their consistent support and co-operation extended to the Company. We also acknowledge the significant contribution made by the employees for their dedication and hard work and trust reposed on us. We look forward to have the same support in our endeavor to help the Company to grow faster.

For and on behalf of the Board

Ravi Jhunjhunwala

Place: Noida Chairman

Date : 22nd April, 2014 DIN - 00060972

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Mar 31, 2013

Dear members,

The Directors present the Annual Report together with the audited Balance Sheet and the Statement of Profit and Loss of RSWM Limited for the year ended 31st March, 2013.

Company''s Performance

Your Company''s performance during the year 2012-2013 is summarised below:

Financial Results (Rs. In Crore)

2012-13 2011-12

Turnover

Export 720.19 730.35

Domestic 1,750.85 1,269.80

TOTAL 2,471.04 2,000.15

Profit before Interest & Depreciation 331.17 160.99

Less: Interest 121.29 104.04

Profit before Depreciation 209.88 56.95

Less: Depreciation 108.45 89.10

Profit/(Loss) before Tax 101.43 (32.15)

Less: Current Tax (20.26) (3.85)

Deferred Tax Liability (13.30) (6.51)

Profit/(Loss) after Tax 67.87 (21.79)

Add: Opening Balance 76.19 97.98

Profit available for appropriation 144.06 76.19

Dividend and Other Appropriations

From the amount available for appropriation, Rs.6.80 crore is proposed to be transferred to the General Reserve.

Your Directors are pleased to recommend a dividend @100% i.e. Rs.10/- per Equity Share of Rs.10/- each for the year ended the 31st March, 2013. This will absorb an amount of Rs.27.09 crore (inclusive of distribution tax). A proposal for confirmation of the dividend for the year ended 31st March, 2013 will be placed before the shareholders at the ensuing Annual General Meeting.

The balance amount of Rs.110.18 crore has been carried over to next year.

Operational performance

During the year under review, your Company succeeded in meeting the challenges posed by the ongoing global economic crisis and came back strongly with improved efficiency, productivity and profitability.

The Company registered increase of 23.54% in its gross turnover from Rs.2,000.15 crore in 2011-12 to Rs.2,471.04 crore in 2012-13. The export turnover remained almost static at Rs.720.19 crore in 2012-13 as against Rs.730.35 crore in 2011-12 whereas domestic turnover increased to Rs.1,750.85 crore in 2012-13 from Rs.1,269.80 crore in the previous year. The analytical review of the Company''s performance and its businesses, including initiatives in the areas of human resources and information technology, have been presented in the section on Management Discussion and Analysis of the Annual Report.

Working results of last three financial years 2010-11 to 2012-13 are given in Annexure - 1 and form part of this report.

Expansion and Modernisation

Your Directors are pleased to inform the Members that the Company during the year continued to make further strides to achieve the targets laid down in pursuit of the ''Lakshya 2016'' programme with a targeted turnover of Rs.4,500 crore and involving a capex of Rs.1,500 crore in stages to be achieved by 2016. Your Directors in the previous year''s report had mentioned about the first phase of the above programme involving a capital outlay of Rs.355 crore. Your Directors are glad to inform the Members that the Company during the year under review completed the expansion of capacity by 51,840 spindles at the Kharigram Unit of the Company. The Company also set up a spinning facility at the Denim Unit precursor to the scheduled expansion of the weaving capacity at this unit. The above expansions were completed in the second half of the financial year at a total cost of Rs.355 crore. The full benefits of the above expansions will be reflected in the working of current financial year 2013-14.

Your Directors further inform the Members that the Company initiated a capital outlay plan for supply and upgradation of Effluent Treatment Plant (ETP) at its Kharigram, Ringas, Denim and TPP Plants and Sewerage Treatment Plant (STP) at all locations at an estimated cost of Rs.15.15 crore, as a part of various eco-friendly measures. Your Directors inform the Members that these programmes are expected to be completed in the first quarter of the current financial year, 2013-14.

Subsidiary company and Joint venture

Your Directors inform the Members that during the year under review M/s. Cheslind Textiles Limited (CTL), subsidiary of your Company, implemented the CDR scheme approved by the CDR Cell under the aegis of RBI and also approved by the shareholders of CTL. Your Directors further inform that pursuant to the CDR scheme, your Company was allotted 1,64,00,000 equity shares of Rs.10/- each for an aggregate amount of Rs.16.40 crore raising the total shareholding of RSWM Limited to 69.85% from 66.07% held in the previous year. Your Directors, report to the Members that the implementation of CDR scheme and infusion of fresh funds have resulted in improvement of performance and profitability of CTL. As the CTL extended its last financial year to 18 months, the financial year 2012-13 of CTL comprises of six months ending on 31st March, 2013.

Your Directors gladly inform the Members that during the year under review, your Company entered into an Agreement with M/s. Bhilwara Energy Limited (BEL) to set up 20 MW Wind Power Project in the State of Rajasthan under the Group Captive Scheme. Your Directors further inform the Members that through this scheme the Company had ensured power supply at a fixed rate for 20 years, which will enable the Company to not only meet its long-term power requirements at a fixed price but also meet its Renewable Power Obligation (RPO) as per Rajasthan Electricity Regulatory Commission''s guidelines for RPO regulations. The present minimum cost of a renewable energy certificate is Rs.1.50 per unit. Your Directors state that this is a step in the direction of moving towards green energy. Your Directors inform the Members that this Wind Power Project was commissioned in March, 2013 and the power generation has already started.

A Statement of particulars of Cheslind Textiles Limited, subsidiary of the Company is part of the Annual Report. In compliance with Clause 32 of Listing Agreement, audited consolidated financial statements also form part of this Annual Report.

Contribution To The Exchequer

Your Company has contributed an amount of Rs.80.92 crore in terms of taxes and duties to the Exchequer.

Directors'' Responsibility Statement

Pursuant to Section 217(2AA) of the Companies Act, 1956, the Directors state that:

- in the preparation of the Annual Accounts, the applicable Accounting Standards have been followed and no material departures have been made from the same;

- appropriate Accounting Policies have been selected and applied consistently and they have 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 on 31st March, 2013 and of the Profit or Loss of the Company for the year ended on that date;

- proper and sufficient care has been taken 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;

- the Annual Accounts have been prepared on a ''going concern'' basis.

Energy Conservation, Technology Absorption And Foreign Exchange Earnings And Outgo

The information required to be disclosed pursuant to Section 217(1)(e) of the Companies Act, 1956 read with Companies (Disclosure of Particulars in the report of Board of Directors) Rules, 1988, is given in Annexure -II forming part of this Report.

Directors

The following Directors retire by rotation and being eligible offer themselves for re-appointment:

1. Shri Ravi Jhunjhunwala

2. Shri Arun Churiwal

3. Dr. Kamal Gupta

Shri J. C. Laddha was re-appointed as Executive Director of the Company for a further period of two years with effect from the 1st January, 2013 to 31st December, 2014, subject to the approval of the members of the Company. The Board recommends the reappointment of Shri J. C. Laddha.

Shri Riju Jhunjhunwala was co-opted on the Board as Additional Director. Shri Riju Jhunjhunwala was designated as Joint Managing Director with effect from the 1st May, 2013. The terms and conditions of appointment of Shri Riju Jhunjhunwala would be decided in due course, subject to the approval of the members of the Company. The Board recommends the appointment of Shri Riju Jhunjhunwala.

Internal Control Systems

Your Company is having adequate internal control systems commensurate with its size and nature of business. The Company is having SOPs in most areas of its operations. These SOPs and internal control systems assured the consistency of financial and operational information and compliance with applicable laws.

The Internal Audit function, head of which reports directly to Audit Committee of the Board, through in-house and external agencies, ensures the adherence to these SOPs and control the deviations/variances, if any, which come to the light.

Particulars Of Employees

Statement of particulars of Employees as required to be furnished pursuant to Section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 is attached hereto and is given in Annexure-III forming part of this Report.

Auditors

The Company''s Auditors M/s. S. Bhargava Associates and M/s. A. L. Chechani & Co., retire at the conclusion of the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment. The observations of the Auditors, if any, are explained wherever necessary, in the appropriate Note to the Accounts.

Corporate Governance

Report on Corporate Governance along with the Certificate of Auditors M/s S. Bhargava Associates, Chartered Accountants, 1, Pareek College Road, Bani Park, Jaipur (Rajasthan) and M/s. A. L. Chechani & Co., Chartered Accountants, 17 Heera Panna Market, Pur Road, Bhilwara (Rajasthan) confirming compliance to conditions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement, form part of the Annual Report.

Acknowledgements

Your Directors express their gratitude to all Customers, Dealers, Suppliers and Investors as well as Banks, Financial Institutions and the Central and State Governments and the Members of the Company for the continued support and cooperation extended by them to the Company. Your Directors also thank the employees of the Company across all levels for the sincere and hard work put in by them during the year under review.

For and on behalf of the Board

Ravi Jhunjhunwala

Place: Noida Chairman

Date: 1st May, 2013 DIN - 00060972

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Mar 31, 2012

The Directors present the Annual Report together with the audited Balance Sheet and Statement of Profit and Loss of RSWM Limited for the year ended 31st March, 2012.

Company's Performance

Your Company's performance during the year 2011 -2012 is summarised below:

Financial Results (Rs.in crore) 2011-12 2010-11

Turnover

Export 730.35 783.62

Domestic 1,269.80 1,178.54

Total 2,000.15 1,962.16

Profit before Interest & Depreciation 160.99 340.11

Less: Interest 104.04 78.74

Profit before Depreciation 56.95 261.37

Less: Depreciation 89.10 80.15

Profit / (Loss) before Tax (32.15) 181.22

Less: Current Tax (3.85) 34.40

Deferred Tax Liability (6.51) 23.86

Profit / (Loss) after Tax (21.79) 122.96

Add: Opening Balance 97.98 33.06

Profit available for appropriation 76.19 156.02

Dividend and Other Appropriations

Keeping in mind the financial position of the Company during the financial year under review, your Directors do not recommend any dividend on the Equity Shares of the Company.

The amount available for appropriation Rs.76.19 crore has been carried over to the next year.

Operational Performance

During the year under review, your Company's operations suffered due to the huge fluctuations in the prices of cotton and yarn as well as volatile market conditions prevailing in the global arena which affected the quantum of exports as well as realisations.

The Company registered marginal increase of 1.94% in its gross turnover from Rs.1,962.1 6 crore in 2010-11 to Rs.2,000.1 5 crore in 2011 -12. The export turnover decreased to Rs.730.35 crore in 2011-12 from Rs.783.62 crore in 2010-11 whereas domestic turnover increased to Rs.1,269.80 crore in 2011-12 from Rs.1,178.54 crore in the previous year. The analytical review of the Company's performance and its businesses, including initiatives in the areas of Human Resources and Information Technology, have been presented in the section on Management Discussion and Analysis of this Annual Report.

Expansion and Modernisation

Your Directors in the previous report had talked about "LAKSHYA 2016" programme with a targetted turnover of Rs.4,500 crore involving a capex of Rs.1,500 crore in phased manner to be achieved by 201 6. Your Directors are pleased to inform the members that the first phase of aforementioned programme had already been undertaken involving a capex of Rs.355 crore. The programme consists of expansion of capacity by 51,840 spindles for manufacturing of synthetic yarns, 10,632 spindles and 2,400 open-end rotors for manufacturing of cotton yarn and expansion of weaving capacity with matching spinning facility to increase denim fabric manufacturing capacity by 2.7 million metres. Out of the above expansion plans, installation of 1,440 rotors and denim fabric manufacturing capacity have been completed successfully during the year under review. Installation of balance capacity is in progress and is expected to start commercial production by the end of Q1 of financial year 2012-13.

Subsidiary Company

Your Directors inform the members that during the year under review, M/s Cheslind Textiles Limited (CTL), subsidiary of your Company, in view of its depleting financial position, approached the Corporate Debt Restructuring (CDR) cell under the aegis of RBI for restructuring of its debts.

The CDR cell approved the Debt Restructuring Scheme of CTL and issued the Letter of Approval dated 30th March, 2012 with a cut-off date as of 1st December, 2011. In view of the financial restructuring, CTL has extended the financial year 2011-12 to eighteen months with necessary approvals to end on 30th September, 2012.

Your Directors further report that CTL is seeking approval of its shareholders for implementing the CDR Scheme and related matters.

Your Management is confident that with the implementation of the scheme and infusion of fresh funding, CTL will be able to improve its financial position in the coming years.

A Statement of particulars of Cheslind Textiles Limited, subsidiary of the Company is part of the Annual Report. In compliance with Clause 32 of Listing Agreement, audited consolidated financial statements also form part of this Annual Report.

Contribution to the Exchequer

Your Company has contributed an amount of Rs.84.71 crore in terms of taxes and duties to the Exchequer.

Directors' Responsibility Statement

Pursuant to Section 21 7(2AA) of the Companies Act, 1956, the Directors state that:

- in the preparation of the Annual Accounts, the applicable Accounting Standards have been followed and no material departures have been made from the same;

- appropriate Accounting Policies have been selected and applied consistently and they have 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 on 31 st March, 2012 and of the Profit and Loss of the Company for the year ended on that date;

- proper and sufficient care has been taken 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;

- the Annual Accounts have been prepared on a going concern basis.

Energy Conservation, Technology Absorption and Foreign Exchange Earnings and Outgo

The information required to be disclosed pursuant to Section 217(1 )(e) of the Companies Act, 1956 read with Companies (Disclosure of Particulars in the report of Board of Directors) Rules, 1988, is given in Annexure - II forming part of this Report.

Directors

The following Directors retire by rotation and being eligible offer themselves for re-appointment:

1. Shri L. N. Jhunjhunwala

2. Shri Shekhar Agarwal

3. Shri D. N. Davar

During the period under review, EXIM Bank has withdrawn the nomination of Shri Prabhakar Dalai from the Board and nominated Shri N. Shankar as its Nominee-Director on the Board of Directors of the Company. Shri N. Shankar has resigned from the Board and Exim Bank has nominated Shri T. G. Regunathan as its Nominee-Director on the Board of Directors of the Company.

The Board expresses its deep appreciation for the services rendered by Shri Prabhakar Dalai and Shri N. Shankar during their tenure. The Board welcomes Shri T. G. Regunathan on the Board of Directors of the Company.

Internal Control Systems

The Company has in place adequate Internal Control Systems commensurate with its size and nature of business. These systems not only provide a reasonable assurance in respect of providing financial and operational information but also compliance with applicable statutes and safeguarding of assets of the Company. These systems ensure that transactions are executed in accordance with specified policies and resources are deployed as per the business plan.

The Company has an in-house Internal Audit Division and the head of internal audit function reports directly to the Audit Committee to ensure independence of this function.

Particulars of Employees

Statement of particulars of Employees as required to be furnished pursuant to Section 217(2A) of Companies Act, 1956 read with Companies (Particulars of Employees) Rules, 1975 is attached hereto and is given in Annexure-III forming part of the this Report.

Auditors

The Company's Auditors M/s. S. Bhargava Associates and M/s A.L. Chechani & Co., retire at the conclusion of the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment. The observations of the Auditors are explained wherever necessary, in the appropriate Note to the Accounts.

Corporate Governance

Report on Corporate Governance along with the Certificate of Auditors M/s. S. Bhargava Associates, Chartered Accountants,

1, Pareek College Road, Bani Park, Jaipur (Rajasthan) and M/s.

A. L. Chechani & Co., Chartered Accountants, 17, Heera Panna Market, Pur Road, Bhilwara (Rajasthan) confirming compliance to conditions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement, form part of the Annual Report.

Acknowledgements

Your Directors express their gratitude to Customers, Dealers and Suppliers, Investors, Members, Banks, Financial Institutions, Central and State Governments for the continued support and co-operation extended by them to the Company. Your Directors also thank the employees of the Company across all levels for the sincere and hard work put in by them during the year under review.

For and on behalf of the Board Ravi Jhunjhunwala

Place: Noida Chairman

Date: 4th May, 2012 DIN - 00060972

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Mar 31, 2011

Dear Members,

The Directors present the Annual Report together with the audited Balance Sheet and the Profit and Loss Account of RSWM Limited for the year ended 31st March, 2011.

Company's Performance

Your Company's performance during the year 2010-11 is summarised below:

Financial Results

( Rs.in Crore)

This year Previous year

Turnover

Export 783.62 566.70

Domestic 1,178.54 971.79

Total 1,962.16 1,538.49

Profit before Interest & Depreciation 333.94 192.88

Less: Interest 72.57 56.73

Profit before Depreciation 261.37 136.15

Less: Depreciation 80.15 87.64

Profit before Tax 181.22 48.51

Less: Current Tax 34.40 10.02

Deferred Tax Liability 23.86 2.46

Profit after Tax 122.96 36.03

Add: Opening Balance 33.06 29.82

Profit available for appropriation 156.02 65.85

Dividend and other appropriations

From the amount available for appropriation, Rs.12.50 crore is proposed to be transferred to General Reserve. A sum of Rs.5 crore has been transferred to Preference Share Capital Redemption Reserve.

During the year, the Board of Directors of your Company approved the payment of an interim dividend @ 10% p.a., i.e. Rs.2.47 per share on 3,33,400 Redeemable Preference Shares of Rs.150/- each, which were redeemed on 30th May, 2010, for the period till redemption in order to meet the contractual obligation. This amounted to Rs.0.10 crore inclusive of distribution tax.

Your Directors feel immense pleasure in informing the Members that during the year an Interim Dividend of 100% i.e. Rs.10/- per equity share was approved and paid on equity shares of Rs.10/- each in view of the 50th Anniversary (Golden Jubilee) year of the Company and LNJ Bhilwara Group. This amounted to Rs.26.99 crore inclusive of distribution tax. Your Directors are pleased to recommend to Annual General Meeting, a final dividend on Equity Shares @ 50% i.e. Rs.5 per share amounting to Rs.13.45 Crore inclusive of distribution tax.

The payment of interim dividend and recommendation of final dividend on the Equity Shares for the year ended 31st March, 2011 will tantamount to total dividend of 150% i.e. Rs.15 per share aggregating Rs.40.44 Crore inclusive of distribution tax. A proposal for noting the payment of interim dividend on Preference shares and Equity shares and declaration of final dividend on Equity shares for the year ended 31st March, 2011 will be placed before the shareholders at the ensuing Annual General Meeting.

The balance amount of Rs.97.98 crore has been carried over to next year.

Operational performance

Your Directors gladly inform the Members that the financial year under review, which happens to be the 50th Anniversary year (Golden Jubilee) of the Company and the LNJ Bhilwara Group, recorded the best performance of the Company since inception in terms of both the turnover and profitability.

The Company registered an increase of 27.54% in its gross turnover from Rs.1538.49 Crore in 2009-10 to Rs.1962.16 Crore in 2010-11. This increase in turnover has been primarily on account of increase in yarn production to 93913 MT against 85784 MT in previous year and fabric production to 23.16 million metres from 21.44 million metres. The Export turnover increased to Rs.783.62 Crore in 2010-11 from Rs.566.70 Crore in 2009-10 and Domestic turnover to Rs.1178.54 Crore in 2010-11 from Rs.971.79 Crore in the previous year. The details of analysis of performance of the Company and it's businesses, including initiatives in the areas of Human Resources and Information Technology, have been presented in the section on Management Discussion and Analysis of this Annual Report.

Working results of last three financial years 2008-09 to 2010- 11 are given in Annexure I and form part of this report.

Expansion and modernisation

Your Directors in their previous report had talked about expansion plan for addition in spindleage, replacement of old machinery, up-gradation of some equipments at various units of the Company, involving capital expenditure of Rs.70 Crore. Your Dierctors feel pleasure in informing members that the above expansion plan was successfully completed during the year under review and has started yielding incremental contributions to the turnover and profitability of the Company.

Your Directors gladly inform the members that encouraged with the performance of the Company, your Directors have chalked out "LAKSHYA 2016" programme with a targeted turnover of Rs.4500 Crore and involving a capex of Rs.1500 Crore to be implemented in phased manner to be achieved by the year 2016. The necessary details are being worked out and members will be updated on this plan in due course. Your Directors are hopeful that with the support of all stakeholders, the Company will be able to achieve the target.

Subsidiary companies & joint venture

During the year under review, your Company set off the liability against the Corporate Guarantee given to Exim Bank in connection with the loan availed by RSWM International B.V., the wholly owned subsidiary Company, by paying off an amount of Rs.14.42 Crore to Exim Bank.

Your Directors further inform the members that RSWM International B.V., the wholly owned subsidiary Company has since been voluntarily liquidated within the legal frame-work of Netherlands.

A Statement of particulars of Cheslind Textiles Limited, subsidiary of the Company is part of the Annual Report.

Contribution to the exchequer

Your Company has contributed an amount of Rs.79.91 crore in terms of taxes and duties to the Exchequer.

Directors' responsibility statement

Pursuant to Section 217(2AA) of the Companies Act, 1956, the Directors state that:

- in the preparation of the Annual Accounts, the applicable Accounting Standards have been followed;

- appropriate Accounting Policies have been selected and applied consistently and they have made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company on 31st March, 2011 and of the Profit and Loss of the Company for the year ended on that date;

- proper and sufficient care has been taken 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;

- the Annual Accounts have been prepared on a going concern basis.

Energy conservation, technology absorption and foreign exchange earnings and outgo

The information required to be disclosed pursuant to Section 217(1)(e) of the Companies Act, 1956 read with Companies (Disclosure of Particulars in the report of Board of Directors) Rules, 1988, is given in Annexure – II forming part of this Report.

Directors

The following Directors retire by rotation and being eligible offer themselves for re-appointment:

1. Shri Arun Churiwal

2. Shri A.N. Choudhary

3. Shri Sushil Jhunjhunwala

During the period under review, EXIM Bank has withdrawn its nomination of Shri John Mathew from the Board and nominated Shri Prabhakar Dalal as its Nominee-Director on the Board of Directors of the Company.

The Board places on record its deep appreciation for the services rendered by Shri John Mathew during his tenure. The Board welcomes Shri Prabhakar Dalal on the Board of Directors of the Company.

Internal control systems

The Company has in place proper and effective Internal Control Systems commensurate with its size of operations to ensure that all systems and procedures are functioning satisfactorily and all policies are being duly complied with as required. The operations of the Company are regularly reviewed by the Audit Committee to examine and evaluate the adequacy, relevance and effectiveness of the internal control systems. The Audit Committee makes recommendations wherever found appropriate for improvement in efficiencies and effectiveness of the internal control systems.

Particulars of employees

Statement of particulars of Employees as required to be furnished pursuant to Section 217(2A) of Companies Act, 1956 read with Companies (Particulars of Employees) Rules, 1975 is attached hereto and form part of this Report as Annexure – III.

Auditors

The Company's Auditors M/s. S. Bhargava Associates and M/s A.L. Chechani & Co., retire at the conclusion of the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment. The observations of the Auditors are explained wherever necessary, in the appropriate Note to the Accounts.

Acknowledgements

Your Directors place on record their appreciation for the continued support and co-operations received by your Company from the Customers, Dealers and Suppliers, Investors, Members, Banks, Financial Institutions, Central and State Governments. Your Directors also thank the employees of the Company across all levels for the sincere and hard work put in by them during the year under review.

For and on behalf of the Board

Place: Noida Ravi Jhunjhunwala

Date: 28th April, 2011 Chairman

DIN No. 00060972

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Mar 31, 2010

The Directors present the Annual Report together with the audited Balance Sheet and the Profit and Loss Account of RSWM Limited for the year ended 31st March 2010.

COMPANYS PERFORMANCE

Your Companys performance during year 2009-2010 is summarized below:

FINANCIAL RESULTS (Rs. in Crore)

This Year Previous Year

Turnover

Export 566.70 391.64

Domestic 971.79 910.60

TOTAL 1,538.49 1,302.24

Profit before Interest & Depreciation 193.26 76.97

Less: Interest 56.82 67.99

Profit before Depreciation 136.44 8.98

Less: Depreciation 87.64 72.67

Profit/(Loss) before Tax and Exceptional Items 48.80 (63.69)

Less: Foreign Exchange Fluctuations 0.29 31.64

Profit/(Loss) before Tax 48.51 (95.33)

Less: Fringe Benefit Tax - 0.92

Current Tax 10.02 -

Deferred Tax Liability 2.46 (32.40)

Profit/(Loss) after Tax 36.03 (63.85)

Add: Opening Balance 29.82 107.15

Profit available for Appropriation 65.85 43.30

DIVIDEND AND OTHER APPROPRIATIONS

From the amount available for appropriation, Rs.4 crore is proposed to be transferred to General Reserve.

Your Directors are pleased to recommend to the Annual General Meeting a dividend on Equity Shares of Rs.10 each @ 25% i.e. Rs. 2.50 per Share amounting to Rs. 5.79 crore. Your Directors further recommend a dividend on Redeemable Preference Shares of Rs.150/- each @ 10% per share amounting to Rs.1.75 Crore. The aggregate amount on dividend payable will absorb a sum of Rs.8.79 crore inclusive of distribution tax. A proposal for confirmation of the dividend for the year ended 31st March, 2010, will be placed before the shareholders at the ensuing Annual General Meeting. A sum of Rs. 20 crores has been appropriated towards the creation of Preference Share Capital Redemption Reserve for the redemption of 13,33,200 Preference Shares. The balance amount of Rs.33.06 crores has been carried over to next year.

OPERATIONAL PERFORMANCE

The Companys efforts to develop new products & markets, stringent control over the productivity and cost and favourable market conditions have helped in improving Companys Performance in 2009-10 and putting the Company on profitable path again. The Company has registered an increase of 18.10% in its gross turnover from Rs.1,302.24 Crore to Rs.1,538.49 Crore in 2009-10 against 2008-09. This increase in turnover has been primarily on account of increase in yarn production to

85784 MT against 78769 MT in previous year and fabric production to 23.21 Million Mtrs. from 20.29 Million mtrs. The Export turnover increased to Rs.565.16 Crore in 2009-10 from Rs.390.26 Crore in 2008-09 and Domestic turnover to Rs.952.88 Crore in 2009-10 from Rs.899.36 Crore in the previous year. The details of analysis of performance of the Company and its businesses, including initiatives in the areas of Human Resources and Information Technology, have been presented in the section of Management Discussion and Analysis of this Annual Report.

Working results of last three financial Year 2007-08 to 2009-10 are given in Annexure I and form part of this report.

EXPANSION AND MODERNISATION

Your Directors in their previous report indicated that with the improvement in market conditions, the enhanced manufacturing capacities will start yielding significant contributions to the top line and bottom line of the Company. Your Directors feel pleasure in informing the members that during the year under review, your Company successfully reaped the benefits on enhanced manufacturing facilities.

Your Directors gladly inform the members that encouraged with the performance of the Company an expansion plan involving capital expenditure of Rs.70 crores has been approved. This will involve addition in existing spindleage, replacement of old machinery, upgradation of some equipments etc. at various units of the Company. Your Directors are hopeful that the capex contemplated above will shore up its efficiency and help in achieving increased profitability.

POWER

Your Directors, in previous report have informed that there will be a substantial reduction in raw material cost with successful use of pet coke and possibilities of securing domestic coal under Fuel Supply Agreement from South Eastern Coalfields Limited.

Your Directors feel pleasure in informing you that the Company has started receiving coal under Fuel Supply Agreement from SECL which is fulfilling around 30% of its requirement and cheaper too as compared to market price. The international price of coal has drastically come down, which has reduced the cost of generation. The Thermal Power Plant has operated at 92.46% Plant Load Factor.

Your Directors are also pleased to inform you that the progress of Private Railway Sidings for coal unloading at Namli (MP) is at very advanced stage and likely to be commissioned in July 2010, which will further reduce the transportation cost of coal and dependance on existing leased Railway siding at Shambhupura.

DE-MERGER

De-merger of Strategic Investment Division of the Company comprising of 66,00,000 Equity Shares of M/s BMD Private Limited was completed during the year under review pursuant to order of the Honble High Court of Rajasthan. The Equity Shares of the resultant Company M/s Bhilwara Technical Textiles Limited was listed on Bombay Stock Exchange Limited during the year under review.

SUBSIDIARY COMPANIES & JOINT VENTURE

Your Directors inform the members that the Joint Venture Agreement with RSWM SISA S.A., Spain through its subsidiary M/s RSWM International B.V. was terminated by the Company with the mutual agreement. The above Joint Venture was not yielding the desired results and on the basis of prudent business decision, the Company has terminated the same.

A Statement of particulars of the Companys subsidiaries namely Cheslind Textiles Limited and RSWM International B.V. is part of the Annual Report.

CONTRIBUTION TO THE EXCHEQUER

Your Company has contributed an amount of Rs.34.96 crore in terms of taxes and duties to the Exchequer.

DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 217(2AA) of the Companies Act, 1956, the Directors state that:

- in the preparation of the Annual Accounts, the applicable Accounting Standards have been followed;

- appropriate Accounting Policies have been selected and applied consistently and they have made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company on 31st March, 2010 and of the Profit and Loss of the Company for the year ended on that date;

- proper and sufficient care has been taken 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;

- the Annual Accounts have been prepared on a going concern basis.

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

The information required to be disclosed pursuant to Section 217(1)(e) of the Companies Act, 1956 read with Companies (Disclosure of Particulars in the report of Board of Directors) Rules, 1988, is given in Annexure - II forming part of this Report.

DIRECTORS

The following Directors retire by rotation and being eligible offer themselves for re-appointment:

1. Mr. Ravi Jhunjhunwala

2. Mr. Shekhar Agarwal

3. Dr. Kamal Gupta

During the period under review, EXIM Bank has withdrawn its nomination of Mr. Mukul Sarkar from the Board and nominated Mr. John Mathew as its Nominee-Director on the Board of Directors of the Company. Further Mr. Sushil Jhunjhunwala and Mr. A. N. Choudhary were appointed as Directors liable to retirement by rotation by the Shareholders in the 48th Annual General Meeting of the Company held on 25th September 2009.

The Board places on record its deep appreciation for the services rendered by Mr. Mukul Sarkar during his tenure. The Board welcomes Mr. Sushil Jhunjhunwala, Mr. A. N. Choudhary and Mr. John Mathew on the Board of Directors of the Company.

INTERNAL CONTROL SYSTEMS

The Company has proper, adequate and effective Internal Control Systems commensurate with the nature and size of its operations. The independent auditors regularly conducts internal and management audit of all the units of the Company. The financial statements, internal audit report and internal control systems are being regularly reviewed by the Audit Committee which examines and evaluates the adequacy, relevance and effectiveness and its compliance with prevailing laws and regulations and thereafter, makes appropriate recommendations, wherever necessary.

PARTICULARS OF EMPLOYEES

Statement of particulars of Employees as required to be furnished pursuant to Section 217(2A) of Companies Act, 1956 read with Companies (Particulars of Employees) Rules, 1975 is attached hereto and form part of this Report as Annexure - III.

AUDITORS

The Companys Auditors M/s. S. Bhargava Associates, Jaipur and M/s A.L. Chechani & Co., Bhilwara, retire at the conclusion of the ensuing Annual General Meeting and being eligible, offer themselves for re-appointment. The observations of the Auditors are explained wherever necessary, in the appropriate Note to the Accounts.

ACKNOWLEDGEMENTS

Your Directors place on record their appreciation for the continued support and co-operation received by your Company from the customers, dealers and suppliers, investors, members, banks, financial institutions, Central and State Governments. Your Directors also thank the employees of the Company across all levels for the sincere and hard work put in by them during the year under review.

For and on behalf of the Board Place :Noida Ravi Jhunjhunwala Date :29 th April,2010 Chairman DIN No.:00060972