Directors Report of Vardhman Industries Ltd.

Mar 31, 2014

Dear members,

We have pleasure in presenting the 30th Annual Report of the Company along with the Audited Statement of Accounts for the year ended 31st March, 2014:

FINANCIAL RESULTS (Rs. in Lacs)

CURRENT YEAR PREVIOUS YEAR

Revenue from operations and other operating income 40027.28 38307.67

Profit before Interest, Depreciation and Tax 2205.08 1828.20

Less: Finance Cost 847.95 800.19

Cash Profit before Tax 1357.13 1028.01

Provision for Depreciation 663.20 671.54

Taxes : Current Tax 140.00 - Deferred Tax 20.75 823.95 125.04 796.58

Profit after Tax 533.18 231.43

Add:

Balance b/f from Previous Year 6032.08 5825.65

Profit available for appropriations 6565.26 6057.08

Appropriations

Proposed Dividend 78.95 -

Tax on dividend 13.42 -

Transferred to General Reserve 25.00 25.00

Surplus Carried to Balance Sheet 6447.89 6032.08

6565.26 6057.08

OPERATIONS

During the year under report, your Company has registered a higher gross revenue and operating income of Rs. 40027.28 lacs as compared to Rs. 38307.67 lacs in the previous year. Your Company has recorded a jump of about 20 % in profit before interest, depreciation and tax which has risen from Rs. 1828.20 lacs in previous year to Rs. 2205.08 lacs. Accordingly the company has recorded a sharp jump of about 130 % in profit after tax which has risen from Rs. 231.43 lacs in previous year to Rs. 533.18 lacs on account of better sales realisations.

EXPORTS

The Board hereby inform you that due to continued slow down in the industry in general and in Iron and Steel Industry in particular and despite all efforts made by the management for exports of its products, the company''s exports have declined from Rs. 6210.73 lacs to Rs. 4435.64 lacs because of stiff competition from chinese products. The company has continued to exports its production in various countries such as Burkina, Somalia, Mozambique, Turkmenistan and Angola.

DIVIDEND

Keeping in view the performance and profitability of the Company, your Directors are pleased to recommend dividend of 10 % (Re.1.00 per equity share of Rs.10/- each) for the year ended 31.03.2014.

LISTING OF SHARES

The Equity Shares of the Company are listed at BSE Limited, Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai. The company has duly paid the listing fee to BSE Limited, Mumbai upto the Financial Year 2014-15.

FIXED DEPOSITS

During the year, your Company has not accepted any fixed deposits within the meaning of Section 73 of the Companies Act, 2013 and the Rules made thereunder.

DIRECTORS

Mr. Vikram Jain and Mr. Ashwani Kumar, Directors of the company retire by rotation at the forthcoming Annual General Meeting and being eligible offer themselves for re-appointment. Further reappointment of Mr. Suresh Gupta, Mr. Ashwani Kumar, Mr. Ashok Kumar Jain and Mr. Surinder Kumar Vig as independent directors as per Sections 149, 150 & 152 of the Companies Act, 2013 for a period of 5 years upto the conclusion of the 35th Annual General Meeting of the Company in the calendar year 2019 for each director is proposed to be made.

CORPORATE GOVERNANCE

Your company has been practicing the principle of good Corporate Governance over the years. The Board of Directors supports the broad principles of Corporate Governance. In addition to the basic governance issues as dictated by compliance of statutory requirements, the Board lays strong emphasis on transparency, accountability and integrity. Corporate Governance Report and Management Discussion and Analysis along with Certificate of the Auditors of your company pursuant to clause 49 of the Listing Agreement with the Stock Exchange(s) has been annexed to the report as Annexure-I.

AUDITORS

M/s Raj Gupta & Co., Chartered Accountants, Auditors of the company, retire at the conclusion of this Annual General Meeting and are eligible for re-appointment. They have furnished a certificate to the effect that their reappointment, if made, will be in accordance with Section 139(1) of the Companies Act, 2013.

AUDITORS'' REPORT

The Auditors'' Report read with the relevant notes on accounts for the year under review is self explanatory and do not call for any further comments as there are no adverse remarks in the Auditors'' Report.

AUDIT COMMITTEE

Presently the constituent members of the Audit Committee are Mr. Suresh Gupta, Mr. Surinder Kumar Vig, Mr. Ashwani Kumar and Mr. Ashok Kumar Jain. Mr. Suresh Gupta is the Chairman of the said Committee. The statutory auditors and internal auditors are the permanent invitees to the audit committee meetings. The Committee met four times during the year under review.

COST AUDITORS

The Board of Directors has appointed M/s. Meenu & Associates, Cost Accountants, Ludhiana as the Cost Auditors of the Company under Section 148 of the Companies Act, 2013 for which application to the Central Government has already been made seeking approval for appointment of Cost Auditors to conduct audit in respect of all the Units of the Company for the financial year 2014-15. The Cost Audit Report for the financial year 2013-14 will be filed with the Central Government as per provisions of the Companies Act, 1956.

SECRETARIAL AUDITORS

M/s RCS & Company has been appointed as Secretarial Auditors of the Company. The appointment of the Secretarial Auditors is to be approved by the members at the ensuing Annual General Meeting to verify the Secretarial records and to provide Secretarial Audit Report for the financial year 2014-15. The Board recommends to appoint M/s RCS & Company, the Secretarial Auditors and to fix their remuneration.

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

Information as per Section 217(1)(e) read with Companies (Disclosure of particulars in the Report of Board of Directors) Rules, 1988 are given in the Annexure-II forming part of this report.

PERSONNEL AND INDUSTRIAL RELATIONS

The Management - Employees relations remained cordial throughout the year. The results achieved during the year have been possible only with the dedication and hard work at all levels of workers, staff and executives of the Company.

Statement pursuant to Section 217(2A) of the Companies Act, 1956 and the companies (Particulars of Employees) rules, 1975 as amended :

None of the employees of the Company is receipt of remuneration in excess of Rs.60.00 lacs per annum or Rs.5.00 lacs per month during the year under review and as such the information under this head is NIL.

DIRECTORS'' RESPONSIBILITY STATEMENT

Directors'' Responsibility Statement pursuant to the provisions of Section 217(2AA) of the Companies Act, 1956 is given in Annexure-III forming part of this report.

CORPORATE SOCIAL OBJECTIVES

Corporate Social Responsibility(CSR) activities of Vardhman Industries Limited reflect its philosophy of enhancing value to the society and the environment around us.

Our Philosophy works with objectives of contributing to the sustainable development of the society and to create a greener and cleaner environmental around us.

The CSR activities done by the Company are identified after conducting a proper market research to identify the social and environment needs which are need of the hour.

ACKNOWLEDGEMENT

Your Directors take this opportunity to express their sincere thanks and appreciation to the team of executives, staff members and workers at all levels for their co-operation, hard work, dedication and devotion. Our thanks are also due to the Bankers, Government Authorities and Business constituents for their continued support and co-operation extended from time to time to the Company.

By order of the Board of Directors

Sd/- Sd/-

Place : Ludhiana (KAPIL KUMAR JAIN) (RAHUL JAIN) Date : 14.08.2014 Chairman Managing Director

---

Mar 31, 2013

To The Members,

The have pleasure in presenting the 29th Annual Report of the Company along with the Audited Statement of Accounts for the year ended 31st March, 2013:

FINANCIAL RESULTS (Rs. in Lacs)

CURRENT YEAR PREVIOUS YEAR

Revenue from operations and other operating income 38307.67 38317.43

Profit before Interest, Depreciation and Tax 2189.84 2790.36

Less: Finance Cost 1161.83 995.51

Cash Profit before Tax 1028.01 1794.85

Less:

Provision for Depreciation 671.54 567.16

Taxes : Current Tax -- 203.97

Deferred Tax 125.04 796.58 273.07 1044.20

Profit after Tax 231.43 750.65

Add:

Balance b/f from Previous Year 5825.65 5191.76

Profit available for appropriations 6057.08 5942.41

Appropriations

Proposed Dividend -- 78.95

Tax on dividend -- 12.81

Transferred to General Reserve 25.00 25.00

Surplus Carried to Balance Sheet 6032.08 5825.65

6057.08 5942.41



OPERATIONS:

During the year under report, your Company recorded a marginally lower gross revenue and operating income of Rs.38307.67 lacs as compared to Rs.38317.43 lacs in the previous year. Profit before interest, depreciation and tax is placed at Rs.2189.84 lacs as compared to Rs.2790.36 lacs of the previous year representing a fall of over 21 %. Profit after tax has fallen sharply from Rs.750.65 lacs in previous year to Rs.231.43 lacs.

In the last financial year, the over all growth was flat and the margins were very low due to macro economic challenges of the economy particularly in the Iron and Steel Industry. Due to this low economic growth and stiff competition input costs increased and on the other hand, sales prices declined which has resulted in drastic fall in profitability of the Company. Further, the performance of your company needs to be viewed in the backdrop of the Indian economy having, for FY 2012-13, one of the lowest GDP growth rates for more than a decade. Your management is seized of the matter and making all out efforts to improve the performance of the Company. It is exploring the possibility of adding certain new clients pertaining to white goods sector for which our product is a import substitute.

EXPORTS:

The Board hereby inform you that due to continued slow down in the industry in general and in Iron and Steel Industry in particular and despite all efforts made by the management for exports of its products, the company''s exports have declined from Rs.8449.02 lacs to Rs.6210.73 lacs. The share of exports to Net Sales declined from 22.05% in 2011-12 to 16.22% in 2012-13. The company has continued to exports its production in various countries such as Burkina, Somalia, Mozambique, Jambia, Zimbawe and Angola and the management is quite hopeful that in future it will be able to achieve improved results on Export Front.

SUBSIDIARY COMPANY:

In line with the vision of the management and keeping in view long term viability, your company has set up a Tinplate unit through its subsidiary Vallabh Tinplate Private Limited (VTPL). It is a forward integration for the products of your company. Tinplate, a value added flat steel product, is a versatile packaging substrate used in edible oils, paints, processed foods, beverages and other industries. Against the estimated domestic consumption of approximately five lacs tonnes, 40% is met through imports; and VTPL is confident of capturing this market share, as an import substitute product, without affecting the competitors. The unit started operations during financial year 2012-13 and achieved Net Sales of Rs.95.56 crores. This unit with an installed capacity of 60,000 TPA is expected to give a turnover of around Rs.300 crores at 85% capacity during the current financial year.

The consolidated financial statements presented by the Company include financial information of its subsidiary prepared in compliance with applicable Accounting Standards. The Ministry of Corporate Affairs, Government of India vide its circular no. 5/12/2007-CL-III dated 8th February, 2011 has granted general exemption under section 212 (8) of the Companies Act, 1956, from attaching the balance sheet, profit and loss account and other documents of the subsidiary companies to the Balance Sheet of the Company provided certain conditions are fulfilled. Accordingly, Annual accounts of the subsidiary Company and the related detailed information will be made available to the parent and subsidiary company''s investors seeking such information at any point of time. The annual accounts of the subsidiary company will also be kept for inspection by any investor at registered/ administrative offices of the company and its subsidiary.



Financial Number of Extent of

Year Shares held & Holding

ending of the Face Value Subsidiary

(1) (2) (3)

31.03.2013 65,10,000 50.08%

Equity shares

of Rs.10/- each

For Financial Year of the Subsidiary

Profit/(Losses) so far it Profit/(Losses) so far concerns the members of it concerns the the Holding Company and members of the not dealt with in the books Holding Company and of accounts of the Holding dealt with in the books Company (Except to the of accounts of the extent dealt within Col.5) Holding Company

(4) (5)

Rs.53,75,944 Nil

STATEMENT PURSUANT TO SECTION 212 (8) OF THE COMPANIES ACT, 1956 RELATING TO VALLABH TINPLATE PRIVATE LIMITED :



(Rs. in lacs)

Particulars Current Year Previous Year

Capital 1300.00 822.00

Reserves 124.52 17.17

Total Assets 15792.60 10271.33

Total Liabilities 14368.08 9208.08

Capital work in progress included in total Assets 105.36 7911.85

Investment included in total Assets 15.00 15.00

Turnover (Net) 9556.25 --

Profit before Taxation 161.20 --

Provision for Taxation

- Current Tax 32.25 --

- MAT Credit Entitlement (32.25) --

- Deferred Tax 53.85 --

Profit after Taxation 107.35 --

Proposed Dividend -- --



DIVIDEND:

With a view to conserve resources for future requirements of the Company, your directors have not recommended any dividend for the year under consideration.

LISTING OF SHARES:

The Equity Shares of the Company are listed at BSE Limited, Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai. The company has duly paid the listing fee to BSE Limited, Mumbai upto the Financial Year 2013-14.

FIXED DEPOSITS:

During the year, your Company has not accepted any fixed deposits within the meaning of Section 58 A of the Companies Act, 1956 and the Rules made thereunder.

DIRECTORS:

Mr. Kapil Kumar Jain and Mr. Suresh Gupta, Directors of the company retire by rotation at the forthcoming Annual General Meeting and being eligible offer themselves for re-appointment.

CORPORATE GOVERNANCE:

Your company has been practicing the principle of good Corporate Governance over the years. The Board of Directors supports the broad principles of Corporate Governance. In addition to the basic governance issues, the Board lays strong emphasis on transparency, accountability and integrity.

Corporate Governance and Management Discussion and Analysis Reports along with Certificate of the Auditors of your company pursuant to clause 49 of the Listing Agreement with the Stock Exchange has been included in the report as Annexure-I.

AUDITORS:

M/s Raj Gupta & Co., Chartered Accountants, Auditors of the company, retire at the conclusion of this Annual General Meeting and are eligible for re-appointment. They have furnished a certificate to the effect that their re-appointment, if made, will be in accordance with sub-section (IB) of Section 224 of the companies Act, 1956.

AUDITORS'' REPORT:

The Auditors'' Report read with the relevant notes on accounts for the year under review is self explanatory and do not call for any further comments as there are no adverse remarks in the Auditors'' Report.

AUDIT COMMITTEE:

Presently the constituent members of the Audit Committee are Mr. Suresh Gupta, Mr. Surinder Kumar Vig, Mr. Ashwani Kumar and Mr. Ashok Kumar Jain. Mr. Suresh Gupta is the Chairman of the said Committee. The statutory auditors and internal auditors are the permanent invitees to the audit committee meetings. The Committee met five times during the year under review.

COST AUDITORS:

The Board of Directors has appointed M/s. Meenu & Associates, Cost Accountants, Ludhiana as the Cost Auditors of the Company under Section 233 B of the Companies Act, 1956 for which application to the Central Government has already been made seeking approval for appointment of Cost Auditors to conduct audit in respect of all the Units of the Company for the financial year 2013-14.

The Cost Audit Report for the financial year 2012-13 will be filed with the Central Government as per provisions of the Companies Act, 1956.

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

Information as per Section 217(1)(e) read with Companies (Disclosure of particulars in the Report of Board of Directors) Rules, 1988 are given in Annexure-II forming part of this report.

PERSONNEL AND INDUSTRIAL RELATIONS:

The Management - Employees relations remained cordial throughout the year. The results achieved during the year have been possible only with the dedication and hard work at all levels of workers, staff and executives of the Company.

Statement pursuant to Section 217(2A) of the Companies Act, 1956 and the companies (Particulars of Employees) rules, 1975 as amended:

None of the employees of the Company is receipt of remuneration in excess of Rs.60.00 lacs per annum or Rs.5.00 lacs per month during the year under review and as such the information under this head is NIL.

DIRECTORS'' RESPONSIBILITY STATEMENT

Director''s responsibility Statement pursuant to the provisions of Section 217(2AA) of the Companies Act, 1956 is given in Annexure-III forming part of this report.

ACKNOWLEDGEMENT

Your Directors take this opportunity to express their sincere thanks and appreciation to the team of executives, staff members and workers at all levels for their co-operation, hard work, dedication and devotion. Our thanks are also due to the Bankers, Financial Institutions, Government Authorities and other Business Constituents for their continued support and co-operation extended from time to time to the Company.



By order of the Board of Directors

Sd/- Sd/

Place : Ludhiana (KAPIL KUMAR JAIN) (RAHUL JAIN)

Date : 14.08.2013 Chairman Managing Director

---

Mar 31, 2012

We have pleasure in presenting the 28th Annual Report of the Company along with the Audited Statement of Accounts for the year ended 31st March, 2012.

FINANCIAL RESULTS (Rupees in Lacs)

CURRENT YEAR PREVIOUS YEAR

Revenue from operations and other operating income 38317.44 33687.83

Profit before Interest, Depreciation and Tax 2498.40 2669.76

Less: Finance Cost 703.55 667.40

Cash Profit before Tax 1794.85 2002.36

Less:

Provision for Depreciation 567.16 432.83

Taxes : Current Tax 203.97 360.00

Deferred Tax 273.07 1044.20 121.09 913.92

Profit after Tax 750.65 1088.44

Add:

Balance b/f from Previous Year 5191.76 4220.08

Profit available for appropriations 5942.41 5308.52

Appropriations

Proposed Dividend 78.95 78.95

Tax on dividend 12.81 12.81

Transferred to General Reserve 25.00 25.00

Surplus Carried to Balance Sheet 5825.65 5191.76

5942.41 5308.52

OPERATIONS:

Despite the industry in general and Iron & Steel Industry in particular passing through .a phase of slowdown, your Company has performed well on account of its diversified product mix and economies of scale even though the results are better than other Companies in the industry but Company's profitability has reduced as compared to previous year. Your Company has registered a higher turnover and other operating income of Rs. 38317.44 lacs as compared to Rs. 33687.83 lacs of previous year recording an increase of about 14%. This has been made possible mainly due to better sales realisation particularly in value added products such as GP/GC Sheets and Colour Coated Sheets etc. However, the Company has recorded a decline of about 31% in profit after tax which has fallen from Rs. 1088.44 lacs in previous year to Rs. 750.65 lacs.

EXPORTS:

We are pleased to inform you that during the year under review the Company laid more emphasis on Exports by exploring new markets for its products in various countries such as Malawi, Iran, Dubai, Jambia, Zimbawe and Angola. The Company has been able to register a healthy growth of over 11% in exports which has increased from Rs. 7597.53 lacs to Rs. 8449.02 lacs. The company has been able to make major dent in export markets despite stiff competition and the management is quite hopeful that in future it will be able to achieve still better results on Export Front.

SUBSIDIARY COMPANY:

The Ministry of Corporate Affairs vide its General Circular No. 2/2011, dated 8th February 2011 have granted permission to holding companies not to attach accounts of its subsidiary companies, with the Balance Sheet of the company.

The Company has only one subsidiary Company namely 'Vallabh Tinplate Private Limited' (VTPL). The Annual Accounts of VTPL are not attached with the Annual Report of the Company. The Company will make available the annual accounts of the subsidiary company and the related detailed information to any member of the company who may be interested in obtaining the same. The annual accounts of the subsidiary company will also be kept open for inspection at the Registered/Administrative Offices of the company and that of the subsidiary company. VTPL has set up a unit for the manufacture of Tinplate with a capacity of 60000 TPA at Village Bapror, Tehsil Rajpura, District Patiala in the State of Punjab at a cost of Rs. 88.86 crore. The said project has since been implemented, trial production was started in June, 2012 and commercial sales have started in July, 2012. Out of the total capital of Rs.822.00 lacs as on 31.03.2012, your Company held 60.95 %.

STATEMENT PURSUANT TO SECTION 212 OF THE COMPANIES ACT, 1956 RELATING TO VALLABH TINPLATE PRIVATE LIMITED :

Financial Number of Extent of For Financial Year of the Subsidiary Year Shares held &. Holding Profit/(Losses) so far It Profit/(Losses) so far ending of the Face Value concerns the members of It concerns the Subsidiary the HoldlnS Company and members of the not dealt with the books Holding Company and of accounts of the Holding dealt within the books Company (Except to the of accounts of the extent dealt within Col.5) Holding Company

(1) (2) (3) (4) (5)

31.03.2012 50.10,000 of 60.95% N.A* N.A* Rs.10/- each

(*) The project was under implementation stage for the year ended 31.03.2012.

STATEMENT PURSUANT TO SECTION 212 (8) OF THE COMPANIES ACT, 1956 RELATING TO VALLABH TINPLATE PRIVATE LIMITED :

(Rs. In lacs)

Particulars Current Year Previous Year

Capital 822.00 551.00

Reserves 17.17 17.16

Total Assets 10271.33 1809.63

Total Liabilities 9208.08 1131.74

Capital work in progress included in total Assets 7911.85 1325.62

Investment included in total Assets 15.00 15.00

Turnover (Net) -- --

Profit before Taxation -- --

Provision for Taxation -- --

Profit after Taxation -- --

Proposed Dividend -- --

DIVIDEND:

Keeping in view the performance and profitability of the Company, your Directors are pleased to recommend dividend of 10 % (Re. 1.00 per equity share of Rs.10/- each) for the year ended 31.03.2012.

LISTING OF SHARES:

The Equity Shares of the Company are listed at BSE Limited, Phiroze Jeejeebhoy Towers, Dalai Street, Mumbai. The company has duly paid the listing fee to BSE Limited, Mumbai upto the Financial Year 2012-13.

FIXED DEPOSITS:

During the year, your Company has not accepted any fixed deposits within the meaning of Section 58-A of the Companies Act, 1956 and the Rules made there under.

DIRECTORS:

Mr. Ashok Kumar Jain and Mr. Surinder Kumar Vig, Directors of the company retire by rotation at the forthcoming Annual General Meeting and being eligible offer themselves for re-appointment.

Since our last report Mr. Rahul Gupta has resigned from the directorship of your company w.e.f. 25th January, 2012. The Board places on record with appreciation the services rendered by Mr. Rahul Gupta during his tenure as a director of the Company.

CORPORATE GOVERNANCE:

Your company has been practicing the principle of good Corporate Governance over the years. The Board of Directors supports the broad principles of Corporate Governance. In addition to the basic governance issues, the Board lays strong emphasis on transparency, accountability and integrity. Corporate Governance and Management Discussion and Analysis Reports along with Certificate of the Auditors of your company pursuant to clause 49 of the Listing Agreement with the Stock Exchange has been included in the report as Annexure-I.

AUDITORS:

M/s Raj Gupta & Co., Chartered Accountants, Auditors of the company, retire at the conclusion of this Annual General Meeting and are eligible for re-appointment. They have furnished a certificate to the effect that their re-appointment, if made, will be in accordance with sub-section (IB) of Section 224 of the companies Act, 1956.

AUDITORS' REPORT:

The Auditors' report read with the relevant notes on accounts for the year under review is self explanatory and do not call for any further comments as there are no adverse remarks in the Auditors' Report.

AUDIT COMMITTEE:

Presently the constituent members of the Audit Committee are Mr. Suresh Gupta, Mr. Surinder Kumar Vig, Mr. Ashwani Kumar and Mr. Ashok Kumar jain. Mr. Suresh Gupta is the Chairman of the said Committee. The statutory auditors and internal auditors are the permanent invitees to the audit committee meetings. The Committee met five times during the year under review.

COST AUDITORS:

The Board of Directors has appointed M/s. Meenu &. Associates, Cost Accountants, Ludhiana as the Cost Auditors of the Company under Section 233 B of the Companies Act, 1956 for which application to the Central Government has already been made seeking approval for appointment of Cost Auditors to conduct audit in respect of all the Units of the Company for the financial year 2012-13.

The Cost Audit Report for the financial year 2011-12 will be forwarded to the Central Government as per provisions of the Companies Act, 1956.

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

Information as per section 217(1 )(e) read with Companies (Disclosure of particulars in the Report of Board of Directors) Rules, 1988 are given in Annexure-11 forming part of this report.

PERSONNEL AND INDUSTRIAL RELATIONS:

The Management - Employees relations remained cordial throughout the year. The results achieved during the year have been possible only with the dedication and hard work at all levels of workers, staff and executives of the Company.

Statement pursuant to section 217(2A) of the Companies Act, 1956 and the companies (Particulars of Employees) rules, 1975 is given below:

Note: ine a Dove appointment is contractual ana remuneration inciuaes perquisites value in accordance witn the Income Tax Rules, 1962. Mr. Rahul jain holds 370000 equity shares representing 4.69 % in the paid up capital of the Company.

DIRECTORS' RESPONSIBILITY STATEMENT :

Director's responsibility Statement pursuant to the provisions of Section 217(2AA) of the Companies Act, 1956 is given in Annexure-III forming part of this report.

ACKNOWLEDGEMENT :

Your Directors take this opportunity to express their sincere thanks and appreciation to the team of executives, staff members and workers at all levels for their co-operation, hard work, dedication and devotion. Our thanks are also due to the Bankers, Financial Institutions, Government Authorities and other Business Constituents for their continued support and co-operation extended from time to time to the Company.

By order of the Board of Directors Sd/- Sd/

Place : Ludhiana (KAPIL KUMAR /AIN) (RAHUL JAIN)

Date : 03.09.2012 Chairman Managing Director

---

Mar 31, 2010

We have pleasure in presenting the 26th Annual Report of the Company along with the Audited Statement of Accounts for the year ended 31st March, 2010

FINANCIAL RESULTS (Rupees in Lacs)

CURRENT YEAR PREVIOUS YEAR

Turnover (Gross) 28442.96 29731.75

Profit before Interest, Depreciation and Tax 1868.69 1164.12

Less : Financial Expenses 633.36 515.29

Cash Profit before Tax 1235.33 648.83

Less :

Provision for Depreciation 339.13 325.23

Taxes : Current Tax & FBT 217.00 86.50

Deferred Tax 99.85 655.98 29.35 441.08

Profit after Tax 579.35 207.75

Add:

Balance b/f from Previous Year 3757.79 3588.44

Profit available for appropriations 4337.14 3796.19

Appropriations :

Proposed Dividend 78.95 -

Tax on dividend 13.11 -

Provision for Gratuity - 13.40 Transferred to General Reserve 25.00 25.00

Surplus Carried to Balance Sheet 4220.08 3757.79

4337.14 3796.19

OPERATIONS:

We are pleased to report that during the year under review, your company has recorded a fabulous jump of about 179 % in profit after tax which has risen from Rs. 207.75 lacs in previous year to Rs. 579.35 lacs despite a marginal decline of about 4 % in Gross Turnover from Rs. 29731.75 lacs in previous year to Rs. 28442.96 lacs. This has been made possible mainly due to better product mix and better sale realisation particularly in value added products such as GP/GC Sheets, Colour Coated Sheets and Puff Panels etc.

EXPORTS:

We are pleased to inform you that during the year under review the Company laid more emphasis on Exports by exploring new markets for its products in various countries such as Angola, Australia, Congo, Iran, Somalia, South Africa, Tanzania, Malawi and UAE. Despite all out efforts made by the management for exports of its products, the companys exports have declined from Rs. 5921.00 lacs to Rs. 5172.64 lacs. The company has been able to make major dent in export markets despite stiff competition and the management is quite hopeful that in future it will be able to achieve better results on Export front.

DIVIDEND:

Encouraged by the robust performance and profitability of the Company, your Directors are pleased to recommend a maiden dividend of 10 % (Rs.1.00 per equity share of Rs.10/- each) for the year ended 31.03.2010.

LISTING OF SHARES:

The Equity Shares of the Company are listed at Bombay Stock Exchange Limited, Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai. The company has duly paid the listing fee to Bombay Stock Exchange Limited, Mumbai upto the Financial Year 2010-11.

FIXED DEPOSITS:

During the year, your Company has not accepted any fixed deposits within the meaning of Section 58-A of the Companies Act, 1956 and the Rules made thereunder.

DIRECTORS:

Mr. Kapil Kumar Jain and Mr. Suresh Gupta, Directors of the company retire by rotation at the forthcoming Annual General Meeting and being eligible offer themselves for re-appointment.

CORPORATE GOVERNANCE :

Corporate Governance and Management Discussion and Analysis Reports along with Certificate of the Auditors of your company pursuant to clause 49 of the Listing Agreement with the Stock Exchange has been included in the report as Annexure-I. Your company has been practicing the principle of good Corporate Governance over the years. The Board of Directors supports the broad principles of Corporate Governance. In addition to the basic governance issues, the Board lays strong emphasis on transparency, accountability and integrity.

AUDITORS :

M/s Raj Gupta & Co., Chartered Accountants, Auditors of the company, retire at the conclusion of this Annual General Meeting and are eligible for re-appointment. They have furnished a certificate to the effect that their re-appointment, if made, will be in accordance with sub-section (IB) of Section 224 of the companies Act, 1956.

AUDITORS REPORT :

The Auditors report read with the relevant notes on accounts for the year under review is self explanatory and do not call for any further comments as there are no adverse remarks in the Auditors Report

AUDIT COMMITTEE :

Presently the constituent members of the Audit Committee are Mr.. Suresh Gupta, Mr.. S.K. Vig, Mr. Ashwani Kumar and Mr. Ashok Kumar Jain. Mr. Suresh Gupta is the Chairman of the said Committee. The Committee met five times during the year under review.

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

Information as per section 217(1)(e) read with Companies (Disclosure of particulars in the Report of Board of Directors) Rules, 1988 are given in Annexure-II forming part of this report.

PERSONNEL AND INDUSTRIAL RELATIONS :

The Management - Employees relations remained cordial throughout the year. The results achieved during the year have been possible only with the dedication and hard work at all levels of workers, staff and executives of the Company.

Statement pursuant to section 217(2A) of the Companies Act, 1956 and the companies (Particulars of Employees) rules, 1975 is given below:

Name of Age Designation & Remuneration Qualification

Director Nature of Duties (Rs.)

Mr. Rahul Jain 36 Managing Director* 2 053600/- B.Com.

looking after all

managerial

functions of

the Company



Name of Experience Date of Last Employment Director (Years) Commencement held

of Employment

Mr. Rahul Jain 14 01.08.2009 Vallabh Steels Limited

(*) Salary paid w.e.f 01.08.2009

DIRECTORS RESPONSIBILITY STATEMENT :

Directors responsibility Statement pursuant to the provisions of Section 217(2AA) of the Companies Act, 1956 is given in Annexure-III forming part of this report.

ACKNOWLEDGEMENT :

Your Directors take this opportunity to express their sincere thanks and appreciation to the team of executives, staff members and workers at all levels for their co-operation, hard work, dedication and devotion. Our thanks are also due to the Bankers, Financial Institutions, Government Authorities and other Business Constituents for their continued support and co-operation extended from time to time to the Company.

By order of the Board of Directors



Sd/- Sd/

Place : Ludhiana (KAPIL KUMAR JAIN) (RAHUL JAIN)

Date : 10.08.2010 Chairman Managing Director