KESORAM INDUSTRIES LIMITED - · PDF filewho have made what Kesoram is today and will be ... Messrs Price Waterhouse Share Transfer ... rst Annual General Meeting of KESORAM INDUSTRIES

KESORAM INDUSTRIES LIMITED

ANNUAL REPORT &ACCOUNTS 2009-10

Meeting New Challenges Everyday!

website : www. kesocorp.com

2009-10ANNUAL REPORT & ACCOUNTS

Shri Basant Kumar BirlaChairman

BK

BIR

LA

G

R O U P O F CO

MP

AN

IES

B K BIRLA GROUP OF COMPANIES

The Group Logo - As represented by the 21st Century Atlas

Atlas, the Titan - Collective StrengthAtlas,bearer of the heavens is synonymous with vast, all encompassing strength and is used to symbolise the Group’s own collective strength. It refl ects the combined qualities of astute and dynamic management while emphasising the Group’s tenacity, consisten-

cy, reliability and overall leadership.

The Sun - Enlightenment and GrowthThe Sun, as a source of infi nite energy and inspiration, is used here in conjunction with the Atlas head to represent the vitality and powerful presence of the Group - both in its

industrial prowess and its fi nancial, technological and intellectual skills.

The Earth Segments - Diversifi ed ActivitiesEach of the latitudes around the Titan represent various sections - industrial, agricultural, fi nancial and other activities of the Group. As with the infi nite variety of the world, so is

the strength of the Group, made up of its diverse activities.

The Globe - Global VisionThe Group’s global presence and vision is refl ected in the entirety of the Earth’s sphere.

The Base - Solid FoundationsThe strength of the entire edifi ce depends upon the strength of the foundation embed-

ded in the bedrock, represented here by the Group Name.

The Symmetry - The Resilience, Versatility, and StabilitySeen in its entirety, each of the elements -Atlas, the Sun, the Earth divisions, the Globe

and the Base, together sum up a well conceptualised and balanced conglomerate.

Strong Foundation Sustained Growth Proven Leadership


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Message of the CHAIRMAN

Dear Fellow Shareholders:

Your company’s core business segments – Cement and Tyre – have shown impressive growth.

The cement units have posted the highest ever production fi gures. The Tyre section has shown commendable growth in domestic sales and exports – with an increase in market share.

Another signifi cant achievement has been the scheduled completion of expansion projects. At Vasavadatta Cement, the 4th Unit and a Thermal Power Plant started commercial production in August 2009 and your Company’s world-class Greenfi eld facility for Tyres at Haridwar, Uttarakhand, started commercial production of Truck/Bus Radial Tyres and Motor Cycle/ LCV Tyres during the year.

Your company has also faced challenges very successfully. The surplus capacity in the Indian Cement Industry via-a-vis the growth rate in infrastructure has put pressure on profi ts. Steep increase in raw material prices in last two quarters of the year adversely affected the Tyre Industry.

All the above indicates that your Company is now poised to reap the benefi ts of oncoming economic growth in the country. Steady Government thrusts on infrastructure, increased spending on social measures as well as on employment generation are all factors that will provide further impetus to the growth of the Indian economy.

I extend my thanks to my colleagues and all employees and other stakeholders who have made what Kesoram is today and will be taking it to the next higher level tomorrow.

I sincerely thank my fellow shareholders for their continuous support.

Basant Kumar Birla

W hereas the Global economy was slowly limping back to normalcy, 2009 – 10 was a landmark year for Kesoram. The turnover of your

company has crossed the Rs 5000 crore mark for the fi rst time.

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Registered Offi ce8th Floor, Birla Building9/1, R. N.Mukherjee RoadKolkata – 700 001Phone No : 033-22435453/22429454Fax No : 033-22109455Email : [email protected]

BankersState Bank of India - Lead BankAllahabad Bank, BNP Paribas, Canara Bank, Citibank N. A., HDFC Bank Ltd., Hongkong and Shanghai Banking Corpn. Ltd., ICICI Bank Ltd., Induslnd Bank Ltd., Standard Chartered Bank, State Bank of Hyderabad, UCO Bank, DBS Bank Ltd. and YES Bank Ltd.

AuditorsMessrs Price Waterhouse

Share Transfer AgentMCS Ltd., (Unit : Kesoram Industries Ltd.)77/2A, Hazra Road, Kolkata – 700 029Phone No : 033-24767350 to 54 / 24541892 to 93Fax No : 033-24541961 / 24747674E-mail : [email protected], [email protected]

Shareholders seeking information on accounts published herein are requested to send their queries to the Company at least 10 days before the date of the Meeting.Members are requested to bring at the meeting with them, the printed copy of Annual Report & Accounts being sent to them along with the Notice to avoid inconvenience.

91st

2009-10&ANNUAL REPORT

ACCOUNTS


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CONTENTS9 Notice

14 Report of Directors

20 Report on Corporate Governance

31 Report on Management Discussion and Analysis

34 Particulars of Employees

37 Statement on Conservation of Energy etc.

41 Summarised Balance Sheet of last fi ve years

42 Summarised Profi t & Loss Account for last fi ve years

43 Auditors’ Report

48 Balance Sheet

49 Profi t and Loss Account

50-88 Schedules ‘1’ to ‘18’

89 Cash Flow Statement

91 Balance Sheet Abstract

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Board of DIRECTORS


Shri Krishna Gopal Maheshwari Shri Bhagwati Prasad Bajoria Shri Pesi Kushru Choksey Shri Amitabha Ghosh

Shri Govind Ballabh Pande(Nominee of LICI)

Shri Prasanta Kumar Mallik Smt. Manjushree Khaitan Shri Deepak Tandon(Whole-time Director)


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BIRLA TYRES SECTIONS

Shri R. K. Shah Joint President (Commercial) Shri A. K. Uppal Joint President (Marketing)

Shri Anoj Agarwal Joint President (Works)

Shri Anupam Dutta Joint President (Technical)

Shri Praveen Mehta Vice President (Sales)

Shri P. K. Mitra Vice President (Engineering)

Shri Arindam Gupta Vice President (Production)

Shri S. C. Sood Vice President (Commercial)

Shri Kanti Chaudhury Vice President (Production)

RAYON & TRANSPARENT PAPER SECTIONSShri V. N. Chandak President

Shri J. P. Bohra Sr. Joint President

Shri S. C. Tripathy Joint President (Technical)

Shri A. K. Kejriwal Sr. Vice Presdent (Marketing)

HINDUSTHAN HEAVY CHEMICALS SECTIONShri M. L. Bhattacharya Sr. Vice President (Works)

Shri H. R. Dudhoria Vice President (Commercial)

Team of EXECUTIVES

Shri K. C. JainManager of the Company &Sr. President-Cement Sections

Shri U. S. Asopa Chief Financial Officer &

Sr. Joint President (Finance)

Shri S. K. PatodiaCompany Secretary &

Sr. Vice President (Commercial-Tyre Sections)

CORPORATE OFFICEShri S. R. Chamaria

Sr. Joint President (Accounts & HRD)

Shri Suresh SharmaSr. Joint President (Commercial)

Shri Yashwant MishraSr. Joint President (Marketing-Cement Sections)

Shri G. K. OjhaSr. Vice President (Secretarial)

Shri Vikash AgarwalSr. Vice President (Taxation)

VASAVADATTA CEMENT SECTIONShri D. S. Bindra President

Shri P. R. Sharma Joint President

Shri C. K. Jain Joint President (Engg. & PP)

Shri P. S. Rao Joint President (Projects)

Shri O. P. Sharma Sr. Vice President (Commercial)

Shri I. K. Purohit Sr. Vice President (Marketing)

Shri R. K. Gandhi Vice President (PQC)

Shri B. K. Sharma Vice President (Mechanical)

Shri Rajesh Garg Vice President (Mines)

Shri S. G. Karwa Vice President (Finance & Accounts)

KESORAM CEMENT SECTIONShri S. V. Tapadia Joint President (Finance & Admn.)

Shri K. L. Narayana Rao Joint President (Technical)

Shri Mahesh Agarwal Sr. Vice President (Technical)

Shri Ashok Ostwal Sr. Vice President (Sales & Marketing)

Shri Ch.S.Nageshwar Rao Vice President (PQC)

SPUN PIPES SECTIONShri Sadhan Sarkar Dy. General Manager

The following highlights for the year under review are given in comparison to immediate previous year:Gross Sales have risen from Rs.4292.07 Crore to Rs.5020.63 Crore.Gross Profi t has increased from Rs.520.99 Crore to Rs.648.29 CroreDividend per share is maintained at last year’s rate i.e. Rs.5.50 per share.Increased net worth from Rs.1330.10 Crore to Rs.1540.24 Crore.

Performance HIGHLIGHTS

The Charts below show the current year’s Segment-wise Sales and last five years’ position.

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2005-06 2006-07 2007-08 2008-09 2009-10

Year

5020.63 4292.07

3440.32

2516.46

1877.82

6000

5000

4000

3000

2000

1000

0

Gross SalesRs.

/Cro

re

Segment-wise Sales

Tyre Cement Rayon, T.P. & Chemicals

5.16% 38.08% 56.76%

2005-06 2006-07 2007-08 2008-09 2009-10

Year

1540.24

981.92 1330.10

654.43

416.05

1750

1500

1250

1000

750

500

250

0

Net Worth

Rs.

/Cro

re

2005-06 2006-07 2007-08 2008-09 2009-10

Year

21.21

7.23 5.90

4.67

1.63

25

20

15

10

5

0

Price Earning Ratio (P/E Ratio)

Gross Profi t Dividend per Share (DPS)

2005-06 2006-07 2007-08 2008-09 2009-10

Year

700

600

500

400

300

200

100

0

Rs.

/Cro

re

132.51

400.09

641.80

520.99

648.29

2005-06 2006-07 2007-08 2008-09 2009-10

Year

6

5

4

3

2

1

0

Rs. 3.00

4.00

5.50 5.50 5.50


Pre-Heater, Coal Mill, Raw Mill Silo & Bag House - Unit IV of Vasavadatta Cement at

Sedam in Karnataka.

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Green Field Project of Birla Tyres at Haridwar in Uttarakhand

COMMENCED PRODUCTION IN THE YEAR View of New Units

Tyre Testing and R&D Building - Unit III

Motor Cycle Tyre Curing Section - Unit IV

Radial Tyre Building Machine - Unit III

AWARD

Shri K. C. Jain, Sr. President (Cement Sections) & Manager of the Company, receiving the FAPCCI Award for ”Excellence in workers’ welfare (2008-09)” from the Hon’ble Chief

Minister of Andhra Pradesh, Shri K. Rosaiah at Hyderabad on 5th April, 2010.

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NOTICETO THE MEMBERSNOTICE is hereby given that the Ninety-fi rst Annual General Meeting of KESORAM INDUSTRIES LIMITED will be held on Thursday, the 1st July, 2010 at 11.00 a.m. at “Kala-Kunj”, 48, Shakespeare Sarani, Kolkata -700017, to transact the following business:GENERAL BUSINESS1. To consider and adopt the Reports of the Auditors and the Directors and the Audited Accounts of the Company for the year ended

31st March, 2010.

2. To confi rm the payment of Interim Dividend on Ordinary Shares declared by the Board of Directors in its meeting held on 30th October, 2009.

3. To declare fi nal Dividend on Ordinary Shares for the year ended 31st March, 2010.

4. To appoint Directors in place of Shri.K. G. Maheshwari and Shri G. B. Pande, who retire by rotation and being eligible, offer themselves for re-election.

5. To appoint Auditors and fi x their remuneration.

SPECIAL BUSINESSTo consider and if thought fi t, to pass with or without modifi cation(s), the following resolutions as Ordinary Resolutions:6. “RESOLVED that superseding the earlier resolution passed without prejudice to the powers of the Board of Directors of the

Company under the provisions of Section 293(1)(e) of the Companies Act, 1956, the Board be and is hereby authorized to contribute to charitable and other funds not directly related to the business of the Company or the welfare of its employees up to a sum of Rupees twenty fi ve lac in each case, subject to maximum of Rupees two crore in a fi nancial year of the Company notwithstanding that the aggregate of such contribution made during that fi nancial year may exceed fi ve percent of its three years’ average profi ts as determined in the manner laid down in the aforesaid section.”

7. “RESOLVED that Shri Deepak Tandon, who vacates offi ce at the conclusion of this Annual General Meeting, be and is hereby appointed a Director of the Company, whose offi ce shall not be liable to retirement by rotation.

FURTHER RESOLVED that pursuant to the provisions of Sections 198, 269, 309, 311 and all other applicable provisions, if any, of the Companies Act, 1956, read with Schedule XIII thereto and all guidelines for managerial remuneration issued by the Central Government from time to time, the Company hereby approves the appointment by the Board of Directors (“the Board”) of Shri Deepak Tandon as Whole-time Director of the Company for a period of fi ve years with effect from 1st April, 2010, with liberty to either party to terminate the appointment on three months’ notice in writing to the other, upon the following terms as to remuneration as set out hereafter and with further liberty to the Board of Directors / any Committee thereof / Chairman of the Board from time to time to alter the said terms in such manner as may be in the best interests of the Company, subject however to the restrictions, if any, contained in the Companies Act, 1956, including Schedule XIII thereto as amended up to date or otherwise as may be permissible by law, viz.:

A) Basic Salary & Allowance per month: i) Basic Salary : Rs. 3,00,000/-; ii) Special Allowance : Rs 70,000/-; with authority to the Board of Directors/any Committee thereof/Chairman of the Board to make annual increments in basic

salary and aforesaid Special Allowance (Basic salary not exceeding Rs.10,00,000/- per month and aforesaid Special Allowance not exceeding Rs. 5,00,000/- per month) from time to time as may be deemed fi t and appropriate.

B) Perquisites and other amenities payable: i) House Rent Allowance, Company’s contributions towards Provident Fund & Superannuation Fund, Ex-gratia,

reimbursement of Leave Travel & Medical expenses for self and family, Leave with full pay and allowances, Gratuity and Personal accident insurance premium : As per the Rules of the Company;

ii) Cars: Chauffeur driven cars provided and maintained by the Company for the use on Company’s business and interest on Car Loan as per Scheme of the Company;

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iii) Fees of the clubs: Subject to the maximum of two clubs; iv) Electricity, Maintenance Charges and communication facility at residence: Actual charges of electricity and

maintenance charges of Housing Society with provision of Telephone, telefax and other modern communication facilities at residence.

C) So long as Shri Deepak Tandon functions as Whole-time Director of the Company, he will not be subject to retirement by rotation and shall not be paid any fees for attending the meetings of the Board or any Committee thereof. However, Shri Tandon may get the sitting fees paid / payable to other Directors for attending meeting of Board of Directors / Committee of subsidiary(ies), if any, or companies promoted by the B.K.Birla Group.

D) That the aggregate of the basic Salary, Special Allowance and perquisites and other amenities in any fi nancial year shall be within the limits prescribed from time to time under sections 198, 309 and the other applicable provisions of the Companies Act, 1956, read with schedule XIII of the said Act as may be for the time being, be in force, or otherwise as may be permissible by law.

E) In the event of loss or inadequacy of profi ts in any year, the remuneration including the perquisites and other amenities as aforestated will be paid to Shri Tandon in accordance with the applicable provisions of Schedule XIII of the Companies Act, 1956 and subject to the approval of Central Government wherever required.”

To consider and if thought fi t, to pass with or without modifi cation(s), the following resolutions as Special Resolutions:8. “RESOLVED that pursuant to Section 314 and the other applicable provisions, if any, of the Companies Act, 1956, consent of the

Company be and is hereby accorded to Shri Deepak Tandon, Senior President of Birla Tyres Sections of the Company, who was appointed as Additional Director under Section 260 of the Companies Act, 1956 and Article 103 of the Articles of Association of the Company to hold place of profi t in the Company as Senior President (Accounts, Finance and Taxation) besides the functions of the Senior President of Birla Tyres (both Balasore and Haridwar Sections) to draw a basic salary of Rs.3,00,000/- per month from 01.01.2010 to 31.03.2010 plus all other allowances and benefi ts as per rules of the Company applicable to the category of a Senior President subject to the limits u/s.309 read with Schedule XIII of the Act.”

9. “RESOLVED that pursuant to the provisions of Section 309 and other applicable provisions of the Companies Act, 1956 and Article 106 of the Articles of Association of the Company and subject to all other approvals, if any required, the Company be and is hereby authorized to pay a commission, in addition to the sitting fees for attending the meetings of the Board or Committees thereof and reimbursement of expenses to attend them as per provisions of law from time to time, to the Directors of the Company, who are neither in whole – time employment of the Company nor Managing / Whole-time Director of the Company, at a rate of 1% of the net profi ts of the Company computed in the manner referred to in section 198(1) of the said Act but not exceeding Rs.50 lac (Rupees fi fty lac) to be divided amongst them equally in every fi nancial year for a period of fi ve years with effect from 1st April, 2010 subject however further to such limit per annum as may be decided by the Board in that behalf from time to time.”

By Order of the Board

Registered Offi ce:9/1, R. N. Mukherjee Road, S. K. PatodiaKolkata -700 001 SecretaryDated, the 28th day of April, 2010

Notes:1. A member entitled to attend and vote at the above Meeting is entitled to appoint one or more proxies to attend and vote

instead of himself / herself and the proxy need not be a Member. The Company must receive proxy form(s) not less than 48 hours before the Meeting.

2. Register of Members shall remain closed from 16th June, 2010 to 1st July, 2010 (both days inclusive).3. The relevant Explanatory Statement, pursuant to Section 173(2) of the Companies Act, 1956 in respect of the Special Business

is annexed hereto.4. The Board of Directors of the Company in its meeting held on 30th October, 2009 had declared interim dividend of Rs 2.25 per

ordinary share of the Company and paid the same to those members or their mandatees, whose names stood registered as benefi cial owners / members of the Company as on 17th November, 2009.


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5. The Final Dividend of Rs.3.25 per ordinary share of the Company, as recommended by the Board, if declared at the ensuing Annual General Meeting, will be paid, subject to the provisions of Section 206A of the Act, on or after 9th July, 2010, to those members or their mandatees whose names stand registered in the Company’s Register of Members:

(a) as Benefi cial Owners as at the end of business on 15th June, 2010 as per the lists to be furnished by National Securities Depository Limited and Central Depository Services (India) Limited in respect of the Shares held in Electronic Form, and

(b) as Members in the Register of Members of the Company after giving effect to valid share transfers in Physical Form lodged with the Company or the Share Transfer Agent on or before 15th June, 2010. The Instruments of Share Transfers, complete in all respects, should reach the Share Department of the Company at 9/1, R. N. Mukherjee Road, Kolkata-700 001 or the Share Transfer Agent of the Company i.e. MCS Ltd., Unit: Kesoram Industries Ltd., 77/2A, Hazra Road, Kolkata-700 029 well before the Book Closure date as stated above.

6. In order to avoid the risk of loss / interception of dividend warrants in postal transit and/or fraudulent encashment of dividend warrants, Shareholders are advised to avail of National Electronic Clearing Service (NECS) facility whereby the dividend will be directly credited electronically to their respective Bank accounts. This will ensure speedier credit of dividend.

NECS essentially operates on the new and unique bank account number, allotted by banks post implementation of Core Banking Solutions (CBS) for centralized processing of inward instructions and effi ciency in handling bulk transactions. In this regard, if you hold shares in electronic form, please furnish the new Bank Account Number allotted to you by your bank after implementation of CBS along with a photocopy of a cheque pertaining to the concerned account, to your Depository Participant (DP) at your earliest convenience. If you do not provide your new account number allotted after implementation of CBS by your bank, to your DP, please note that ECS to your old account may either be rejected or returned.

Shareholders holding shares in physical form with a Bank Account covered under CBS may inform the Share Department of the Company / Share Transfer Agent to avail benefi t of NECS.

7. Members, holding shares in physical form, are requested to notify the change in address, if any, to the Share Department of the Company / Share Transfer Agent and the name of the Bank(s) with account number(s) for inscribing it on the face of dividend warrant(s) to avoid the fraudulent encashment of the same. Members holding Shares in Electronic form should send the above information to the respective Depository Participant only.

8. In case the mailing address mentioned on this Annual Report is either without PIN Code or with incorrect PIN Code, members are requested to kindly inform the Share Department of the Company / Share Transfer Agent or the respective Depository Participant(s), as the case may be, their PIN Code immediately for speedy and proper delivery.

9. Members, who are holding Shares, in physical form, in identical order of names in more than one Folio, are requested to apply to the Share Department of the Company / Share Transfer Agent along with the relevant Share Certifi cates for consolidation of such Folios in one Folio.

10. As per provisions of the Companies Act, 1956 (Act), facility for making nominations is now available to Individuals holding shares in the Company. The Nomination Form–2B, prescribed by the Government for the purpose, can be obtained from the Share Department of the Company / Share Transfer Agent.

11. The last dates of claim of the following dividends from the Company are as under:

Dividends for the fi nancialyear ended

Date of declarationof Dividends

Last date for claimingunpaid Dividends

31.03.2003 26.06.2003 25.07.201031.03.2004 30.06.2004 29.07.201131.03.2005 30.06.2005 29.07.201231.03.2006 29.06.2006 28.07.201331.03.2007 14.03.2007 (Interim) 13.04.201431.03.2008 26.06.2008 25.07.201531.03.2009 31.10.2008(Interim) 30.11.201531.03.2009 26.06.2009 25.07.201631.03.2010 30.10.2009(Interim) 29.11.2016

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12. Pursuant to the provisions of Section 205A read together with 205C of the Act, dividends for the fi nancial year ended 31st March, 2003 and thereafter, which remain unpaid or unclaimed for a period of 7 years will be transferred to the ‘Investor Education and Protection Fund’ constituted by the Central Government.

Members, who have not got encashed the dividend warrant(s) for the fi nancial year ended 31st March, 2003 or any subsequent fi nancial years so far, are requested to make their claim to the Share Department / Share Transfer Agent of the Company.

Further, it may be noted that under the Act, once the unclaimed dividend amount is transferred to the Fund as aforestated, no claim shall lie in respect of such amount.

13. (a) Members desirous of getting any information about the accounts and operations of the Company are requested to address their query/ies well in advance, i.e. at least 10 days before the meeting, to the Whole-time Director or Secretary of the Company to enable the Management to keep the information readily available at the Meeting.

(b) Further, to avoid inconvenience, members are requested to bring at the meeting the printed ‘Annual Report & Accounts’ being sent to them.

(c) Members, who hold shares in Electronic Form are requested to bring their Depository ID Number and Client ID Number to facilitate easier identifi cation for attendance at the Annual General Meeting.

14. As per requirement of Clause 49(IV)(G)(i) of the Listing Agreement with Stock Exchanges, the particulars of Directors retiring by rotation and eligible for reappointment and Shri Deepak Tandon, Whole-time Director, are given in the Corporate Governance Section of the Annual Report.

EXPLANATORY STATEMENT PURSUANT TO SECTION 173 OF THE COMPANIES ACT, 1956ITEM NO. 6Pursuant to Section 293(1)(e) of the Companies Act, 1956, the Board of Directors of the Company is empowered to contribute to charitable and other funds not directly relating to the business of the Company or the welfare of its employees, any amount the aggregate of which will not in any fi nancial year exceed Rupees fi fty thousand or fi ve percent of its three years’ average net profi ts as determined in the manner laid down in the aforesaid Section, whichever is greater. The Company as of now has the limits up to a sum of Rs. 10 lac in one fi nancial year and any contribution in excess of the aforesaid limit will require consent of the Company in the General Meeting. In view of the increasing appeals for donations and considering the corporate social responsibility of the Company in this respect, the Board recommends that it be authorized to make such donations up to Rupees two crore in aggregate even in case of any unforeseen eventuality of inadequate profi ts of the Company in any fi nancial year in the future.The Board recommends the resolution no.6 of the notice for passing by the Shareholders as an Ordinary Resolution.None of the Directors or Manager is interested or concerned with the proposed resolution.ITEM NOS. 7 AND 8Shri Deepak Tandon, Senior President of Birla Tyres (Balasore and Haridwar sections) was appointed as Additional Director in the Company, pursuant to the provisions of section 260 of the Act and Article 103 of the Memorandum & Articles of Association of the Company, with effect from 1st January 2010 upon resignation and cessation of services of Shri S K Parik as Senior President (Finance & Taxation) and Company Secretary and holds offi ce up to the date of this Annual General Meeting but a notice in writing with requisite fees from a member under Section 257 of the Act has been received by the Company intimating his intention to propose his candidature for appointment as Director of the Company.Further, it was decided by the resolution by circulation dated 30.12.2009 that Shri Tandon shall carry out the function of Senior President of Birla Tyres (both Balasore and Hardwar sections) and, in addition, shall also carry out the functions of Senior President (Accounts, Finance and Taxation) of the Company at the remuneration set out in the resolution No. 8. The appointment of Shri Tandon and his drawing of remuneration in the capacity as the Senior President of Birla Tyres sections as well as the Senior President (Accounts, Finance and Taxation) of the Company as set out in resolution No. 8 aforestated, being both place of profi t, requires approval of the shareholders by way of Special Resolution under Section 314 of the Companies Act, 1956. Hence the need for passing the said resolution No. 8 by way of Special Resolution.


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Shri Tandon is a Chartered Accountant and has vast experience in accounts, fi nance and taxation besides wide experience of over 26 years within the Industry. Considering the qualifi cation and experience of Shri Tandon, the Board at its meeting subsequently held on 28th April, 2010 appointed Shri Tandon as a Whole-time Director of the Company at the remuneration as set out in resolution No. 7, subject to the approval of the shareholders for a period of fi ve years with effect from 1st April, 2010. The resolution also proposes to authorize the Board and/or any Committee thereof and/or the Chairman of the Board to make annual increments in the Basic Salary and Special Allowance of Shri Tandon subject to limits as specifi ed in the said resolution.Your Directors are of the view that the remuneration as proposed to be paid to Shri Tandon is in line with the corporate trend prevailing at present and it is desirable that the appointment of Shri Tandon and the payment of the remuneration to him is approved by the shareholders.None of the Directors or the Manager of the Company, except Shri Tandon is concerned or interested in the two resolutions aforesaid. Your directors recommend passing of the aforesaid resolution no.7 as an Ordinary Resolution and resolution no.8 as a Special Resolution.This may also be treated as disclosure under Section 302 of the Companies Act, 1956ITEM NO. 9The approval of Shareholders taken earlier for payment of Commission on net profi ts to Directors other than in whole-time employment has expired on 31.03.2010. The Board is recommending for approval of continuance of payment of the commission to the Directors other than the Directors in whole-time employment and Managing / Whole-time Directors for further period of fi ve years from 01.04.2010, to be calculated at a rate of 1% of the net profi ts of the Company in accordance with the relevant provisions of the Companies Act, 1956, subject to a maximum limit of Rs.50 lac (Rupees fi fty lac) per annum and further subject to such amount as may be decided by the Board each year in such manner as they may from time to time deem fi t & proper, therefore, it requires the approval of Shareholders.The Board of Directors recommends the passing of the resolution mentioned under item no. 9 as a Special Resolution.All the Directors, except Shri Deepak Tandon and the Manager of the Company, are interested in the aforesaid resolution being recipients of the commission.

By Order of the BoardRegistered Offi ce:9/1, R. N. Mukherjee Road, S. K. PatodiaKolkata -700 001 SecretaryDated, the 28th day of April, 2010

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REPORT OF THE DIRECTORSFOR THE YEAR ENDED 31st MARCH, 2010Dear Members,Your Directors have pleasure in presenting the ninety-fi rst Annual Report and the Audited Statements of Accounts of the Company for the year ended 31st March, 2010.

FINANCIAL RESULTS (Rupees in Crore)Particulars 31st March,

201031st March,

2009

Net Sales/Income from Operations (including Excise Duty) 5,020.63 4,292.07

Other Income 125.07 75.94Total Income 5,145.70 4,368.01

Gross Profi t 648.30 520.97Less:Depreciation (Net of transfer from Revaluation Reserve) 172.80 111.86Provision for Income Tax 36.00 45.00Provision for Fringe Benefi t Tax [charge/(credit)] (0.13) 2.00Provision for Deferred Tax [charge/(credit)] 202.29 (16.63)

410.96 142.23Net Profi t 237.34 378.74Less:Debenture Redemption Reserve 101.25 25.00Amount available for appropriation which the Directors have appropriated as under: 136.09 353.74(i) Proposed Final Dividend 14.87 14.87(ii) Tax on Proposed Final Dividend 2.47 2.53(iii) Interim Dividend 10.29 10.29(iv) Income Tax on the Interim Dividend 1.75 1.75(v) General Reserve 24.00 44.78(vi) Balance carried forward to next year 82.71 279.52

136.09 353.74

DEFERRED TAXIn terms of the Accounting Standard on ‘Accounting for Taxes on Income’ (AS-22) a sum of Rs.202.29 crore has been debited to the Profi t & Loss Account being Deferred Tax Liability for the year under review.

TRANSFER TO INVESTOR EDUCATION & PROTECTION FUNDIn terms of sections 205A and 205C of the Companies Act, 1956 read together with General Circular no. 22/2002 dated 23rd September, 2002 issued by the Department of Corporate Affairs, the Company deposited about Rs.13.26 Lac, being Unclaimed Dividend and interest on Fixed Deposits of the Company as well as that of an earlier merged Company, during the year under review in the ‘Investor Education and Protection Fund’ created by the Central Government.


15

DIVIDENDThe Board of Directors in its meeting held on 30th October, 2009 declared an interim dividend and today has recommended the fi nal dividend for the year ended 31st March, 2010 on Ordinary Shares as under:

31st March, 2010 (Rs.)

31st March,2009 (Rs.)

Interim on 4,57,43,318 Ordinary Shares of Rs.10/- each @ Rs.2.25 per Share(Previous year 2.25 per Share )

10,29,22,466 10,29,22,466

Final on 4,57,43,318 Ordinary Shares of Rs.10/- each @ Rs. 3.25 per Share(Previous year Rs.3.25 per Share )

14,86,65,784 14,86,65,784

Thus, the total dividend of Rs.5.50 per share, as per detail given herein above, has been paid / recommended by the Board for the fi nancial year ended 31.03.2010.

AUDIT REPORT

As regards paragraphs 3.1(b) and 3.2(a) referred to by the Auditors in its Report, the physical verifi cation of the fi xed assets (in phased manner) and inventories as referred in para nos. 3.1(b) and 3.2(a) respectively at the Spun Pipes & Foundries Section of the Company, could not be carried out due to continued suspension of work and barricade in front of the factory gate by a section of workers at the said Section. So far as paragraphs 3.9(b) and 3.16 of the report are concerned, the same are self-explanatory and need no further explanation.

Regarding the paragraph 3.19 of the Report, the neccessary security or charge pending to be created in respect of Short-term Debentures will be created within the stipulated time provided by law if not redeemed before. Further, the immovable properties of Birla Tyres, a Section of the Company at Uttarakhand, could not be created due to continuing verifi cation of search report of the said properties by the empanelled lawyer of the Lead Banker, State Bank of India. The Short-term Debentures issued during the year were redeemed before the security could have been created within the stipulated period provided by law.

Further, paragraph 4(f) referred to by the Auditors’ in its Report is self-explanatory and requires no explanation.

GENERAL REVIEW

During the year under review our turnover for the fi rst time crossed Rs.5,000 Crore. This has been primarily due to the increase in sales of Tyre Section from Birla Tyres Unit-II at Laksar, Haridwar. Birla Tyres Unit-III and Unit-IV related to Truck / Bus Radial and Motor Cycle / LCV tyres started Commercial Production in March, 2010 and October, 2009 respectively. Capacity at Vasavadatta Cement was also increased which started Commercial Production in August, 2009.

The total benefi t in top line and bottom line for all these expansions will get refl ected in the coming year.

The profi tability of the Company during the year has also increased due to good results of Cement Sections and enhanced capacity of Tyre Sections besides good treasury management and cost control effected throughout the Company. Rayon Section also showed higher profi tability due to strong domestic demand.

Work at Spun Pipe Section continues to be under suspension.

CEMENT SECTIONSVasavadatta CementYour Directors are pleased to report that the expansion undertaken at this section by setting up the 4th Unit comprising of Cement capacity of 1.65 million ton per annum and thermal power plant of 17.5 MW has been completed. After completion of trial run, commercial production of Cement has started from 7th August, 2009.

Operational performance of this section continues to be good and it has achieved highest ever production of Clinker as well as Cement during the year. Production fi gures of this section given hereunder include 1,29,300 metric ton of clinker and 76,610 metric ton of cement produced during trial run of the 4th Unit:

16

Production 2009-10(Metric Ton)

2008-09(Metric Ton)

Clinker 42,98,390 34,41,496Cement 42,03,373 39,24,589

Cement dispatches were adversely affected due to non-availability of adequate wagons and as a result clinker to the extent of 4,52,045 metric ton was sold during the year.

The Section has achieved higher production despite several challenges such as substantial build-up of new capacity by other companies in the industry, lack of corresponding pickup in demand, shortage of rail wagons for movement of cement, coal and raw materials and unsatisfactory coal availability position in absence of adequate coal linkage arrangements. However, quality of its products, established brand image and proper logistic management have enabled the section to achieve good performance in a year characterized by continued slowdown in the construction sector and weak monsoon. Due to surplus capacity, cement prices were not able to keep pace with rising costs for major part of the year resulting in pressure on margins. Stimulus measures undertaken by the Government, particularly reduction in excise duty, encouragement to infrastructure development and improving liquidity in the economy have however, helped to maintain the growth momentum.

Captive power generation was 445.07 million KWH during the year under review as against 338.12 million KWH during the previous year. Captive power generation catered to about 98% of the total power requirement of the section. 54.15 million KWH being 12.17% of the power generated from the power plants was sold to Gulbarga Electricity Supply Company Ltd. The unit is also exploring the possibilities of power generation from Waste Heat Recovery System which will give considerable advantage in cost of power generation. Further, the Company is also exploring possibilities of further expansion or a Green fi eld unit in nearby area.

As a part of corporate social responsibility, the unit has undertaken various social welfare and community development activities such as construction of water tank and children’s park, plantation of trees, water conservation, health camps, distribution of agricultural implements to the villagers, vocational training and skill development activities, etc. in its surrounding areas.

In the year 2009-10, the Section received two prizes in the ‘Mines Safety Week’ under the aegis of DGMS - Drilling & Blasting First Prize and Method of Working 2nd Prize. Also in the various safety competitions conducted on the occasion of ‘Gulbarga Region Industrial Safety Day 2010’ (GRISD) celebration, our employees bagged various prizes.

Apart from the above, seven Scout & Guide students of our School - Vasavadatta Vidya Vihar have won recently, the coveted Award of ‘Rashtrapati Puraskar’.

Industrial relations with the employees were good during the year.

Kesoram CementProduction fi gures of this Section are as under:

Production 2009-10(Metric Ton)

2008-09(Metric Ton)

Clinker 11,61,200 10,97,175Cement 13,78,833 15,11,615

This Section also has achieved highest ever production of Clinker. However, Cement production and dispatches were adversely affected due to Telangana agitation and paucity of Railway wagons for movement of cement. Consequently, the Section had to sell 55,024 metric ton of clinker. There was substantial capacity expansion also in Andhra Pradesh, which had put pressure on sales realizations and profi tability of the Section. However, from the month of March 2010, cement prices are improving and are expected to improve further in coming months.

The unit has built-up an excellent brand image of its blended cement “BIRLA SHAKTI” and was able to market about 81% of its total output in PPC cement segment.

There has been substantial increase in cost of raw materials and coal. However, Management has taken various control measures to keep the cost of cement under control.


17

Captive Thermal Power Plant of this Section generated 113.29 million KWH of power, out of which 0.03 million KWH were supplied to APTRANSCO. In this Section, about 82% of the power requirement of the cement plant is met from the Captive generation and balance power was purchased from APTRANSCO. Captive Power Plant plays a vital role in improving the cost competitiveness and providing quality power to the Section. In view of this, the Section is considering the feasibility of power generation by Waste Heat Recovery System.The suit challenging the validity of imposition of Electricity Duty on captive power generation @ 25 paise per Unit from 17.07.2003 by the Government of Andhra Pradesh is still pending before the Hon’ble High Court of Andhra Pradesh.This Section bagged the FAPCCI (Federation of Andhra Pradesh Chambers of Commerce & Industry) Award of EXCELLENCE IN WORKERS’ WELFARE for the year 2008-09, which was presented by the Hon’ble Chief Minister of Andhra Pradesh Sri K. Rosaiah on 5th April 2010.Basantnagar Limestone Mines of this Section bagged two 1st prizes for “Environmental & Health Management” and “Maintenance and Operation of Heavy Earth Moving Equipments” and 2nd prize for “Drilling and Blasting” from the Director General of Mines Safety, Hyderabad during the Mines Safety Week celebrations.As a part of corporate social responsibility, the Section is continuing the rural and community development and welfare activities in nearby villages by running of Agricultural Demonstration Farm, Model Dairy Farm, Vocational Training Centre for Youth, Distribution of agricultural implements, Sewing Machines, Tri-cycles for physically challenged people, Animal Health Camps, Blood Donation Camps, Pulse Polio Programs and promotion of Self Help Groups of women for their economic development etc.Industrial relations were cordial during the year.

BIRLA TYRES SECTIONSThe gross turnover of the Section this year has been Rs.2,849.62 Crore as compared to Rs.1,947.23 crore showing an increase of about 46.34% compared to last year. In spite of stiff competition, we have been able to increase our market share from 15% to 18%. The export sales for the year under review amounted to Rs 361.48 crore as against Rs 240.41 crore in the previous year.Though the Section has recorded commendable sales growth but due to sharp increase in raw material prices particularly of rubber in quarter III and quarter IV, profi tability has been adversely affected.The Company’s world class Green fi eld facility for production of Motor Cycle/LCV and Truck/ Bus Radial tyres started commercial production in October, 2009 and March, 2010 respectively.The board has approved further expansion of capacity to produce Truck/Bus Radial tyres by 85 MT/day at Haridwar and for Passenger Car Radial tyres of 80 MT/day at Balasore involving capital outlay of Rs. 350 Crore and Rs. 450 Crore respectively. The civil construction for the above expansions is in full swing and order for the major machineries and equipments have already been placed. The commercial productions in both the projects are likely to commence by March, 2011.The Section continues to have the distinction of being certifi ed for ISO-9001, TS-16949, ISO-14001, SA-8000, OSHAS-18001 and TPM.Relations with employees have been cordial and conducive to growth during the year.RAYON & TRANSPARENT PAPER SECTIONSAmidst challenging environment, performance of VFY (Viscose Filament Yarn) business is satisfactory. Strong domestic demand and higher penetration in export market led to substantial growth in volumes, coupled with reduction in the cost of all the major raw materials – pulp and sulphur, the Section’s operating margin improved in spite of the steep hike in coal & electricity costs. Margins in future, are likely to decline from current level due to upward trend in pulp and sulphur prices. Export demands are also likely to be impacted due to stiff competition from China and the imposition of Anti-dumping duty by the Government has not been of much help in arresting cheap imports in the country. The exports were 612 M.T. against 521 M.T. of previous year.The T.P (Transparent Paper) business continues with unfavourable market environment resulting into poor realization mainly due to competition with cheaper imports & substitutes. As a result of the above, again the production capacity of this Section could not be fully utilized. The exports were 293 M.T. against 306 M.T. of previous year. The recent hike in the rate of Excise Duty will further impact the demand and profi tability of this product.The performance of Section’s chemical business was satisfactory despite the prevailing global economic conditions and cheap imports.Relations with the employees were cordial during the year.

18

SPUN PIPES SECTIONThe factory of this Section continues to be under suspension of work on and from 2nd May, 2008. The blockade and barricade in front of the factory gate is continuing, as a result fi nished goods and other material lying inside the factory could not be removed. All fi nished goods outside the factory have been sold.

During the year Rs 4.53 crore were recovered against old outstanding while sale was of Rs.0.35 crore only.

HINDUSTHAN HEAVY CHEMICALS SECTIONThe production fi gures of the Section were as under :

Production 2009-10 2008-09Caustic Soda Lye 11,663 MT 11,737 M.T.Sulphuric Acid 19,061 MT 19,139 M.T.Hydrogen Gas 7,53,453 M3 8,18,882 M3

Demand for Caustic Soda was subdued during the year due to slow down in Aluminium sector. However, there was improvement in demand for joint products – Chlorine and Hydrochloric Acid – towards the end of the year. Production of Caustic Soda was affected due to frequent breakdowns and power trippings. Production of Hydrogen Gas was lower due to lesser demand from Vanaspati Industry in the fi rst half of the year but improved considerably towards end of the year.

The Section continues to enjoy certifi cates for Quality and Environment management under ISO-9001-2000 and ISO-14001-2004.

The Section takes various measures on its own and also in collaboration with various government agencies for improving awareness of environment and safety.

Relations with employees continue to be cordial.

EXCISE DUTY

During the year under review a sum of Rs 289.98 crore (Rs 414.35 crore in 2008-09) was paid on account of Excise Duty on various products manufactured and sold by your Company.

INSURANCE

Appropriate Insurance cover has been taken for the properties of the Company.

DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to Section 217(2AA) of the Companies Act, 1956, the Directors to the best of their knowledge and belief confi rm that:

i) in the preparation of the Annual Accounts, the applicable Accounting Standards have been followed by the Company;

ii) appropriate Accounting Policies, as mentioned in Schedule 17, have been selected and applied consistently and such judgments and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2010 and of the profi t of the Company for the fi nancial year ended on that date;

iii) proper and suffi cient 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; and

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

CORPORATE GOVERNANCE

Adequate steps to ensure compliance of all the mandatory provisions of ‘Corporate Governance’ as amended in the Listing Agreements of the Stock Exchanges with which the Company’s Shares are listed have been taken and your Company has ensured its required compliance.


19

A separate Report each on Corporate Governance and Management Discussion & Analysis is annexed hereto as Annexure ‘A’ along with Auditors’ Certifi cate for its due compliance and Annexure ‘B’ respectively as part of Annual Report.

DIRECTORSOn 31st December, 2009 Shri S K Parik, Sr. President (Account, Finance & Taxation) and Secretary resigned from the services and also from the Board on 31st March, 2010 after more than 55 years of service to the Company in various capacities. Your Directors wish to place on record their appreciation for the services rendered by Shri Parik during his tenure as a Senior Executive as well as Director of the Company.

Shri K.G. Maheshwari and Shri G.B. Pande, Directors of your Company, retire from the Board by rotation but are eligible for re-election.

AUDITORSThe Company has received a requisite certifi cate pursuant to Sec.224 (1B) of the Companies Act, 1956 and a confi rmation that Price Waterhouse, the Auditors of your Company, is complying with ongoing cycle of peer review process as required by the ‘Statement on Peer Review’ issued by The Institute of Chartered Accountants of India (ICAI) together with a copy of the peer review certifi cate dated 30.8.2006 issued by the ‘Peer Review Board’ of ICAI regarding their eligibility for re-appointment as Auditors, who retire at the ensuing Annual General Meeting and we recommend their re-appointment.

COST AUDITORSThe Company has appointed qualifi ed Cost Auditors, in terms of the directives of the Central Government under section 233B of the Companies Act, 1956, to conduct cost audits of the various products manufactured by the Company.

PARTICULARS OF EMPLOYEESThe particulars as required under section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 forms part of this Report and the same is enclosed as Annexure ‘C’.CASH FLOW ANALYSISThe Cash Flow Statement for the year under reference in terms of clause 32 of the Listing agreement with the Stock exchanges is annexed hereto.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGO.A Statement containing necessary information, as required under the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988, is annexed hereto as Annexure ‘D’.APPRECIATIONWe wish to acknowledge the understanding, support and the services of the sincere workers, staff and executives of the Company, which have largely contributed to the effi cient operations & management of the Company. Your Directors also wish to place on record the valuable co-operation & support received from the Financial Institutions, Banks, the Government of India, the State Governments and the concerned local authorities.

We would also like to express sincere thanks to our Shareholders and Debenture holders for their confi dence and understanding.

B. K. BIRLA Chairman

Kolkata,28th April, 2010.

S.K.PATODIA DEEPAK TANDON Secretary Whole-time Director

K. G. MAHESHWARI

Directors

B. P. BAJORIA P. K. CHOKSEYG. B. PANDEAMITABHA GHOSHP. K. MALLIKMANJUSHREE KHAITAN

20

ANNEXURE “A”REPORT ON CORPORATE GOVERNANCECORPORATE GOVERNANCEYour Company has been practising the principles of good Corporate Governance, which comprise all activities that result in the control of the Company in a regulated manner, aiming to achieve transparent, accountable and fair management.

The details of the Corporate Governance compliance by the company as per the Clause 49 of the Listing Agreement with Stock Exchanges are as under:

I. COMPLIANCE OF MANDATORY REQUIREMENTS:

A. COMPANY’S PHILOSOPHY ON CORPORATE GOVERNANCE:The basic philosophy of Corporate Governance in the Company is to achieve business excellence and dedicate itself to increasing long-term shareholders’ value, keeping in view the needs and interests of all its Stakeholders. The Company is committed to transparency in all its dealings and places emphasis on business ethics.

B. BOARD OF DIRECTORS:i) COMPOSITION OF BOARD, DIRECTORSHIPS & COMMITTEE POSITIONS HELD IN OTHER COMPANIES AND SHARES

OF THE COMPANY HELD AS AT 31ST MARCH, 2010: The Board of the Company comprises of adequate blend of professional, executive & independent directors.

Directors Category

No. of outsideDirectorships held

(excluding **)

Outside Committees # (excluding **)Shares heldAs a Member

(including Chairperson)As a Chairman /Chairmanship

Shri B.K. Birla Non-Executive 4 None None 167707Shri K.G. Maheshwari Non-Executive 1 None None 485Shri B.P. Bajoria Non-Executive* 4 2 1 436Shri P.K. Choksey Non-Executive* 1 2 None 500Shri A. Ghosh Non-Executive* 13 9 5 NilShri P.K. Mallik Non-Executive* 4 4 1 200Shri G. B. Pande(Represents Life InsuranceCorpn. of India – Investor)

Non-Executive* 1 1 1 Nil

Smt. Manjushree Khaitan Non-Executive 1 None None 234114Shri S. K. Parik(up to 31.03.2010)

Company Secretary(up to 31.12.2009)

4 2 1 39

Shri Deepak Tandon(w.e.f. 01.01.2010)

Executive *** 3 None None Nil

* also independent in terms of provisions of clause 49(I)(A)(iii) ** private companies, companies under Sec. 25 of the Companies Act, 1956 and foreign companies. *** Senior President of Birla Tyres(both Balasore & Haridwar Sections), has been appointed as an Additional Director of the

Company w.e.f. 01.01.2010. # only two Committees viz., the Audit Committee and the Shareholders’ Grievance Committee have been considered for

this purpose. Notwithstanding Shri Tandon being the Director, he discharges the functions of Senior President (Accounts, Finance & Taxation)

of the company and continues to discharge his duties and obligations previously performed by him as Senior President of Birla Tyres(both Balasore & Haridwar Sections).


21

ii) ATTENDANCE OF DIRECTORS PRESENT IN THE MEETINGS HELD DURING THE YEAR 2009-10: Five board meetings were held during the fi nancial year ended 31st March, 2010 i.e. on 2nd May, 2009, 26th June, 2009, 25th July,

2009, 30th October, 2009 and 28th January, 2010. The attendance of each director at these meetings was as follows:

Sl. No. Members No. of Board Meetings Attended

AGM held on 26.06.2009Attended

i. Shri B. K. Birla 5 Yes

ii. Shri K. G. Maheshwari 3 Yes

iii. Shri B. P. Bajoria 3 Yes

iv. Shri G. B. Pande 3 No

v. Shri P. K. Choksey 4 Yes

vi. Shri Amitabha Ghosh 5 Yes

vii. Shri P. K. Mallik 5 Yes

viii. Smt. Manjushree Khaitan 4 Yes

ix. Shri S. K. Parik 4 Yes

x. Shri Deepak Tandon 1 N.A.

N.A. : Not applicable as he was appointed as director w.e.f. 01.01.2010.

iii) CODE OF CONDUCT: The Company has a Code of Conduct for all its Board Members and Senior Management personnel for avoidance of confl icts of

interest. It has received the necessary declarations affi rming compliance with it from all of them during the period from 01.04.2009 to 31.03.2010. There were no material personal interests adverse to the interest of the Company and improper personal benefi ts received, as a result of his/her position by the Board Members / Senior Management personnel, which could lead to potential confl ict of interest with the Company. The Code of Conduct is available on the website of the Company.

C. AUDIT COMMITTEE:i) TERMS OF REFERENCE: The Audit Committee has been mandated with the same terms of reference as specifi ed in the revised Clause 49 of the Listing

Agreements with Stock Exchanges and covers all the aspects stipulated by the SEBI Guidelines. The terms of reference also fully conform to the requirements of section 292A of the Companies Act, 1956.

ii) COMPOSITION, NAME OF MEMBERS AND CHAIRMAN: As on 31.03.2010 the Audit Committee consists of three non-executive independent Directors. Four meetings were held during

the fi nancial year ended 31st March, 2010 i.e. on 1st May, 2009, 25th July, 2009, 30th October, 2009 and 28th January, 2010. The composition of the Audit Committee and the attendance of each member at these meetings were as follows:

Sl. No. Members No. of Meetings attended

i.

ii.

iii.

Shri P.K. Mallik - Chairman

Shri P.K. Choksey

Shri Amitabha Ghosh

4

3

4

iii) SECRETARY: Shri S. K. Parik, Director was the Secretary of the Company as well as Audit Committee up to 31st December, 2009. With effect

from 1st January, 2010, Shri S. K. Patodia, Secretary of the Company is Secretary of the Audit Committee.

22

iv) INVITEES: (as & when considered necessary)

a) Shri G. B. Pande, a nominee Director of LICI attended the meeting held on 1st May, 2009.

b) The Statutory Auditors.

c) The Internal Auditors and Cost Auditors.

d) Shri U. S. Asopa, Sr. Joint President (Finance) and Shri Suresh Kumar Sharma, Sr. Joint President (Commercial) at the Corporate Offi ce of the Company.

v) The Audit Committee comprises of all non-executive and independent directors and they are the persons of vast knowledge and experience. Shri P. K. Mallik, Chairman of the Audit Committee is a Senior Chartered Accountant with the requisite Financial and Accounting expertise. Shri P.K. Choksey and Shri A. Ghosh, the other two members are also Senior Chartered Accountants. All the present members are fi nancially literate.

vi) The Chairman of the Audit Committee attended the Annual General Meeting of the company held on 26th June, 2009 and he ensured that necessary clarifi cations and explanations were provided to the members of the Company on issues regarding accounts and fi nance.

vii) The Quarterly Unaudited Financial Results as well as the Annual Financial Statements during the year ended 31st March, 2010 were reviewed and examined by the members of the Audit Committee before recommendation of the same to the Board of Directors for their perusal and approval on the following dates:-

Financial Reporting Date of approval by Audit CommitteeAnnual Financial Statements & Results for the year ended 31st March, 2009 1st May, 2009Quarter ended 30th June, 2009 25th July, 2009Quarter ended 30th September, 2009 30th October, 2009Quarter ended 31st December, 2009 28th January, 2010

D. REMUNERATION COMMITTEE: The Remuneration Committee consists of three Non-Executive Independent Directors i.e. Shri B. P. Bajoria as Chairman and

other two members are Shri P. K. Mallik and Shri P. K. Choksey. The Committee met twice i.e. on 24.07.2009 and 25.01.2010 to bring more transparency and proper consideration in the system of revision of remuneration of the senior executives.

THE DETAILS OF REMUNERATION PAID DURING THE YEAR TO THE DIRECTORS ARE AS UNDER

Sl.No.

Name of the Directors Sitting fees paid for Commission for thefi nancial year

2008-09 paid infi nancial year 2009-2010

Board Meetings(in Rs.)

Committee Meetings(in Rs.)

1 Shri B.K. Birla 1,00,000 - 2,50,0002 Shri K.G. Maheshwari 60,000 - 2,50,0003 Shri B.P. Bajoria 60,000 1,70,000 2,50,0004 Shri P.K.Choksey 80,000 40,000 2,50,0005 Shri A.Ghosh 1,00,000 40,000 2,50,0006 Shri P.K. Mallik 1,00,000 2,20,000 2,50,0007 Smt.Manjushree Khaitan 80,000 - 2,50,0008 Shri G. B. Pande* 60,000 10,000 2,50,0009 Shri S. K. Parik** - - -10 Shri Deepak Tandon*** - - -

Total: 6,40,000 4,80,000 20,00,000


23

* Commission & fees paid to the nominating Institution, Life Insurance Corporation of India. ** Notwithstanding Shri Parik, being the Director, drew the remuneration of Rs.78,10,019/- as Sr. President, Finance &

Taxation and Secretary up to 31st December, 2009 during the fi nancial year ended 31st March, 2010. *** Shri Deepak Tandon received the remuneration of Rs.27,59,365/- for the period 1st January, 2010 to 31st March, 2010

which is subject to approval of shareholders in the ensuing Annual General Meeting.Besides the sitting fees & travelling expenses to attend any meeting of the Board or any Committee thereof, the approval of the Shareholders in its meetings held on 30th June, 2005 & 26th June, 2008 enables the Company to pay commission in every fi nancial year to its Directors (to be divided amongst them equally) except Shri S.K. Parik at the rate of 1 per cent of the net profi t (restricted to maximum Rs.25 Lacs* per annum) of the Company computed in the manner referred to in Section 198/349 of the Companies Act, 1956, for a period of 5 years w.e.f. 1st April, 2005. Shri Deepak Tandon, who was appointed as Additional Director w.e.f. 01.01.2010 is also not entitled to the aforesaid commission.Commission payable to the Directors for the fi nancial year 2009-2010 is Rs. 24,00,000/-.Besides the above, no other pecuniary relationship or transactions vis-a-vis the Company exist with the Non-Executive Directors.* enhanced from Rs 15 lacs per annum, effective fi nancial year 2007-08, in Shareholders’ meeting held on 26th June, 2008.

E. SHAREHOLDERS’ COMMITTEES: i) The “Share Transfer and Finance Committee” is comprised of two non-executives independent Directors namely Shri B.

P. Bajoria & Shri P. K. Mallik and Shri Deepak Tandon is the other member of the Committee. The Committee is headed by Shri B. P. Bajoria. Shri S K Parik resigned from the Committee during the year and in his place Shri Deepak Tandon was inducted as the member w.e.f. 1st January, 2010. It deals with the approval of transfer and transmission of securities, issue of duplicate certifi cate(s) / advices and other Shareholder related issues in addition to matters pertaining to certain fi nance related decisions.

The Committee met 15 times during the year under review. ii) The Company also has a “Shareholders’/Investors’ Grievance Committee” consisting of two non-executive independent

Directors namely, Shri P.K. Mallik, Chairman & Shri B.P. Bajoria and Shri Deepak Tandon, being the other member. Shri S K Parik resigned from the Committee during the year and in his place Shri Deepak Tandon was inducted as the member w.e.f. 1st January, 2010. This Committee specifi cally looks into redressal of Shareholders’ and Investors’ complaints with a primary objective to improve investor relations and had met thrice i.e. on 13th July, 2009, 25th January, 2010 and 22nd March, 2010 during the fi nancial year 2009-2010.

a) POSITION AS ON 31st March, 2010 OF THE SHAREHOLDERS’ COMPLAINTS RECEIVED & REDRESSED DURING THE FINANCIAL YEAR:

Nature of Grievances Complaints received from Total complaintsreceived during

2009-10

Total redressed

No. of grievances outstanding as on

31.03.2010Investors directly

StockExchanges

SEBI ROC

Non-receipt of Dividend/Interest/ Redemption Warrant(s)

33 2 16 Nil 51 51 Nil

Non-receipt of Share / Debenture Certifi cate(s)

4 Nil 5 Nil 9 9 Nil

Non-Receipt of Duplicate Share/ Debenture Certifi cate(s)

Nil Nil Nil Nil Nil Nil Nil

Demat related grievance(s) 5 Nil Nil Nil 5 5 NilNon-receipt of Annual Report(s) 69 4 Nil Nil 73 73 NilTOTAL: 111 6 21 Nil 138 138 Nil

b) NUMBER OF PENDING COMPLAINTS AS AT 31.03.2010: NIL With effect from 01.01.2010 Shri S. K. Patodia, Secretary is the “Compliance Offi cer” of the Company for compliance of

the requirements under the Listing Agreements with the Stock Exchanges. Shri S.K. Parik discharged this function till 31.12.2009.

24

F. GENERAL BODY MEETINGS: i) Details of Annual General Meetings (AGMs) :

AGMs Date of AGMs Location TimeAGM(88th)AGM(89th) AGM(90th)

29th June, 200726th June, 200826th June, 2009

KolkataKolkataKolkata

11.00 A.M.11.00 A.M.11.00 A.M.

ii) SPECIAL RESOLUTIONS PASSED IN THE PREVIOUS THREE AGMs : a) In the AGM on 26th June, 2009: No Special Resolution was transacted. b) In the AGM on 26th June, 2008: For increasing the commission to the Directors of the Company at the rate of 1% of the net profi t of the company to be

divided amongst them equally except Shri S. K. Parik subject to an amount to be decided by the Board every year not exceeding Rs.25 Lacs in every fi nancial year computed as per Section 198(1) of the Companies Act, 1956 for the period of 3 years w.e.f. 1st April, 2007.

c) In the AGM on 29th June, 2007: No Special Resolution was transacted.iii) No Special Resolution was passed during the fi nancial year ended 31st March, 2010 through Postal Ballot.iv) Further, no Special Resolution is proposed to be conducted through Postal Ballot in the ensuing AGM.v) Disclosure for reappointment / appointment of Directors. Resume and other information of the Directors retiring by rotation & getting reappointed as required to be disclosed under Clause

49(IV)(G)(i) of the Listing Agreement is as under:- a) Shri K. G. Maheshwari is an Industrialist having rich experience in the fi eld of business and management, he is Director

of the company since 1963 and is also the Director in Hyderabad Industries Ltd. and Jayshree Traders Pvt. Ltd. He is not holding Membership / Chairmanship of any Committee of Directors of any other body corporate. b) Shri G. B. Pande is a Zonal Manager at Central Zonal Offi ce of Life Insurance Corporation of India nominated by it on the

Board of the Company. He is representing LICI on the Board of J K Tyre & Industries Ltd. and is Chairman of Shareholders’/Investors’ Grievance Committee of Directors of the said company.

c) Shri Deepak Tandon is a Chartered Accountant. He is having vast experience and knowledge in the fi eld of accounts and fi nance besides the hands on experience of more than 26 years of the Tyre and Paper Industry.

He is Director of Precious Services & Consultancy Ltd., Kesoram Insurance Broking Services Ltd. and Zenith Distributors & Agents Ltd. and does not hold any committee membership. He is associated with many organisations and is a member on the Board of Automotive Tyre Manufacturers’ Association & Indian Paper Manufacturers’ Association and Director of TPM Club India. He is an ex-Chairman of CII Orissa State Council (2003-2004) and TQM-HRD Sub Committee, CII, Eastern Region (2005-2008).

The shares held by the above Directors have already been disclosed under the caption Composition of Board of Directors under serial no.I. B(i) above.

G. DISCLOSURES: i) Disclosure on materially signifi cant related party transactions: Details of related party transactions during the year have been set out under Note No. 25 of Schedule 17 of the Annual

Accounts. These are not having any potential confl ict with the interests of the Company at large. ii) Details of Non-Compliance by the Company, penalties, strictures imposed on the Company by the Stock Exchanges,

SEBI or any Statutory authorities on any matter related to Capital Markets:


25

All the requirements of the listing agreement with the Stock Exchanges as well as regulations and guidelines of SEBI have been complied with by the Company. No penalty has been imposed or stricture has been made by SEBI, Stock Exchanges or any Statutory Authorities on matters relating to Capital Markets during the last three years.

iii) Whistle Blower Policy: The Company does not have any Whistle Blower Policy as of now but no personnel is being denied any access to the

Audit Committee. iv) Details of compliance with mandatory requirement and adoption of non-mandatory requirements: All the mandatory requirements have been appropriately complied with and the non-mandatory requirements are dealt

with at the end of this Report.

H. MEANS OF COMMUNICATION:i) Financial Results & ANNUAL REPORTS ETC.: The Quarterly Unaudited Financial Results and the Annual Audited Financial Results as taken on record and approved respectively

by the Board of Directors of the Company are published in leading national newspaper, i.e. The Business Standard (English – all India edition), Dainik Statesman (Bengali – local edition) and are also sent immediately to all the Stock Exchanges with which the Shares of the Company are listed. These results are also posted on Company’s web site www.kesocorp.com. The offi cial news release and other related information, if any, are displayed on the aforesaid website of the Company. Whenever any presentation relating to the Company’s working to analysts/bankers etc. is made, the same is also displayed on the Company’s website as and when such presentation(s) take(s) place.

The Quarterly Unaudited Results and Annual Financial Results along with the Report on Segment Revenue, Results and Capital Employed, Balance Sheet, Profi t & Loss Account, Directors’ Report, Auditors’ Report, Cash Flow Statement, Corporate Governance Report, Report on Management Discussion and Analysis and Shareholding Pattern etc. can also be retrieved by investors from the Electronic Data Information Filing and Retrieval System set up by the National Informatics Center in association with SEBI. The site can be accessed at http://sebiedifar.nic.in for information required.

ii) MANAGEMENT DISCUSSION AND ANALYSIS REPORT (MD&AR): The Management Discussion and Analysis Report as reviewed by Audit Committee set out in Annexure “B” forms part of the

Annual Report.

I. GENERAL SHAREHOLDER INFORMATION: i) NEXT ANNUAL GENERAL MEETING:

Date Time Venue

1st July, 2010 11.00 a.m. “Kala-Kunj”,48, Shakespeare Sarani,Kolkata-700 017

ii) FINANCIAL YEAR : The fi nancial year of the Company covers 1st April to 31st March.iii) DATE OF BOOK CLOSURE: 16th June, 2010 to1st July, 2010 (both days inclusive)iv) DIVIDEND PAYMENT DATE : On or after 9th July, 2010.v) INFORMATION PERTAINING TO THE STOCK EXCHANGES: a) Listing on Stock Exchanges The Calcutta Stock Exchange Association Ltd., 7 Lyons Range, Kolkata-700001 Bombay Stock Exchange Ltd., Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai-400 001 National Stock Exchange of India Ltd., Exchange Plaza, Bandra-Kurla Complex, Bandra (E), Mumbai-400 051 Societe de la Bourse de Luxembourg, Societe Anonyme/R.C.B. 6222,B.P.165, L-2011 Luxembourg

26

b) Stock Code for: Bombay Stock Exchange 502937 National Stock Exchange KESORAMIND Calcutta Stock Exchange 10000020 Luxembourg Stock Exchange 492532205 The annual listing fees of these Exchanges have been paid by the Company for the year 2009-2010. c. ISIN No. for the Company’s Ordinary Shares in Demat Form: INE087A01019 d. Depository Connectivity: NSDL and CDSLvi) STOCK MARKET PRICE DATA:Month Calcutta Stock Exchange * Bombay Stock Exchange National Stock Exchange

High Low High Low High LowApril, 2009 N.T. N.T. 180.00 136.00 178.90 135.05May, 2009 N.T. N.T. 315.00 165.00 300.20 160.00June, 2009 N.T. N.T. 328.00 247.05 333.00 246.05July, 2009 N.T. N.T. 384.95 258.00 384.25 256.25August, 2009 N.T. N.T. 382.10 300.00 382.90 300.10September, 2009 N.T. N.T. 393.50 328.00 393.80 325.00October, 2009 N.T. N.T. 391.00 321.00 391.00 321.00November, 2009 N.T. N.T. 345.00 303.00 353.50 306.90December, 2009 N.T. N.T. 374.40 333.50 375.00 332.25January, 2010 N.T. N.T. 409.00 325.00 409.90 325.00February, 2010 N.T. N.T. 377.00 312.30 377.80 317.00March, 2010 N.T. N.T. 404.60 361.90 404.70 364.00

* Note: There was no trading during the year.

Comparison between Kesoram Median Price Variationand BSE Sensex Variation in Percentage

Perc

enta

ge F

luct

uatio

n

Monthwise Reporting

160

140

120

100

80

60

40

20

0April, 2009 May, 2009 June, 2009 July 2009 August, 2009 September, 2009 October, 2009 November, 2009 December, 2009 January, 2010 February, 2010 March, 2010

KESORAM PRICE VARIATIONBSE SENSEX VARIATION


27

vii) PERFORMANCE IN COMPARISON TO BROAD BASED INDICES SUCH AS BSE SENSEX, CRISIL INDEX ETC.viii) REGISTRAR AND SHARE TRANSFER AGENT: M/s. MCS Limited, (Unit: Kesoram Industries Ltd.) 77/2A, Hazra Road, Kolkata-700 029 Phone Nos.: (033)2476-7350 to 54, 2454-1892/3, Fax Nos.: (033)2454-1961, 2474-7674; e-mail. [email protected], [email protected]) SHARE TRANSFER SYSTEM :Share transfers of physical Shares are generally registered within a maximum period of 3 weeks from the date of receipt provided the documents are complete in all respects. With a view to expedite the share transfer process, certain executives have been delegated with the authority to approve any single transfer not exceeding 10,000 shares. Single transfers above 10,000 shares are approved by the ‘Share Transfer and Finance Committee’. The Company’s Registrar & Share Transfer Agent dispatches the transferred shares to the transferees immediately after the transfers take place.x) DISTRIBUTION OF SHAREHOLDING AS ON 31ST MARCH,2010: a) According To Category Of Holding:

Category No. of Shareholders % of Shareholders No. of Shares % of SharesPromoters 24 0.03 1,21,09,293 26.47Mutual Funds / UTI 36 0.05 67,36,094 14.73Financial Institutions & Banks 47 0.06 2,24,036 0.49Foreign Institutional Investors 24 0.03 8,32,050 1.82Insurance Companies 8 0.01 63,94,293 13.98NRI/OCB 479 0.60 21,83,002 4.77Private Body Corporates 1,200 1.52 26,94,833 5.89Individuals 77,226 97.70 75,27,842 16.46GDRs 1 - 70,41,875 15.39Total 79045 100.00 4,57,43,318 100.00

b) According to number of Ordinary Shares Held:No. of ordinary Shares held No. of Shareholders % of Shareholders No. of Shares % of Shares1-100 68419 86.56 2102611 4.60101-200 5041 6.38 776242 1.70201-500 3376 4.27 1152898 2.52501-1000 1167 1.48 912668 1.991001-5000 770 0.97 1660277 3.635001-10000 113 0.14 841674 1.8410001 – above 159 0.20 38296948 83.72Total: 79045 100.00 45743318 100.00

xi) DEMATERIALIZATION OF SHAREHOLDING AND LIQUIDITY: As per SEBI’s Guidelines, your Company’s Ordinary Shares are compulsorily traded in Dematerialized form for all the investors

with effect from 31st May, 1999. 3,68,54,762 Shares were in Dematerialized form representing 80.57% of the total Ordinary Shares as on 31st March, 2010.

As per agreements of the Company with NSDL and CDSL, the investors have an option to dematerialize their Ordinary Shares with either of the Depositories.

xii) OUTSTANDING GDRS / ADRS / WARRANT OR ANY CONVERTIBLE INSTRUMENTS, CONVERSION DATE AND LIKELY IMPACT ON EQUITY:

The allotment of Ordinary Shares for GDRs issued during the year 1996, was completed in the same year. As such, there are no GDRs/ ADRs or any Convertible Instrument pending conversion to impact the Ordinary Share Capital of the Company.

However, as on 31st March, 2010 the Company awaits 70,41,875 GDRs from its holders for cancellation and delivery of shares against thereof.

28

xiii) INSIDER TRADING: The Code of Internal Procedure & Conduct under The SEBI (Prohibition of Insider Trading) Regulations, 1992 as amended, is

in force since 28.04.2002.

xiv) PLANT LOCATIONS :Section Factory Location City Offi ce Run under

name & style ofCement Sedam, Dist.Gulbarga

Karnataka-585222Phone: 08441-276005/277403Fax: 08441-276139E-mail: [email protected]

10-3-316/2, Crystal Towers, 2nd Floor, Above Andhra Bank, Masab Tank,Hyderabad 500028, A.P.Phone: 040-23342296/8056Fax: 040-23344109/7821E-mail: [email protected].

Vasavadatta Cement

Basantnagar,Dist.KarimnagarAndhra Pradesh-505187Phone.: 08728 -228122/228125/228156Fax: 08728-228160E-mail:[email protected]

10-3-316/2, Crystal Towers, 2nd & 3rd Floors, Above Andhra Bank, Masab Tank,Hyderabad 500028, A.P.Phone: 040-23348896/7843/ 7613Fax: 040-23344109/23347821E-mail: [email protected]

Kesoram Cement

Automobile Tyres and Tubes

P.O. Chhanpur, Via.Kuruda,Dist. Balasore, Orissa, PIN.756056Phone: 06782-254259/780/620Fax: 06782-254225E-mail: [email protected]

Gram Khedimubarakpur,Tehsil Laksar, Dist. Haridwar,Uttarakhand - 247 663.Phone: 01332- 256000/256001.Fax : 01332- 255177.E-mail.:[email protected]

Shivam Chambers53, Syed Amir Ali Avenue,Kolkata-700019Phone .: 033-2281-4813/4717-20Fax: 033-2281-4874E-mail: ho@birlatyre. com

Birla Tyres

Rayon & TransparentPaper

P.O. Nayasarai, Rly. Station: Kuntighat,Near Tribeni, Dist.HooghlyWest Bengal-712513Phone: 033-26846431-34/ 26846457Fax : 033-26846461E-mail: [email protected]

“Industry House”10, Camac Street,Kolkata-700017Phone.033-2282-4721-24Fax: 033-2282-8879E-mail: [email protected]

Kesoram Rayon

Spun Pipes & Foundries

P.O Adcconagar,Bansberia, Dist.HooghlyWest Bengal-712121Phone: 033-26346462/6465/6620Fax : 033-26346621E-mail: [email protected]

“Industry House”10, Camac Street,Kolkata-700017Phone: 033-2282-2476-78Fax: 033-2282-9370E-mail: [email protected]

Kesoram Spun Pipes &Foundries

Heavy Chemicals 19, B. T. Road, Khardah,P.O.Balaram Dharma Sopan,Kolkata-700116Phone: 033-2553-2879/5183Fax: 033-2553-3860/2583-9218E-mail:[email protected]

8th fl oor, Birla Bldg.9/1, R.N. Mukherjee Road,Kolkata-700001Phone: 033-2213-1680-89 (10 Lines)Extn.: 1863/1854Fax: 033-2242-1931E-mail: [email protected]

Hindusthan Heavy Chemicals


29

xv) Address for Correspondence: a) For routine matters: Any assistance regarding Share transfers and transmissions, change of Address, non-receipt of dividends, duplicate /

missing Share Certifi cates, demat and other matters, please write to or contact the Share Department of the Company at the address given below: -

Shri G. K. Ojha, Kesoram Industries Ltd., 9/1, R. N. Mukherjee Road, Kolkata-700001. Phone No.: (033)2243-7121 Fax No. (033)2210-9455 E-mail: [email protected]

Or, Registrar & Share Transfer Agent: M/s. MCS Limited (Unit: Kesoram Industries Ltd.) 77/2A, Hazra Road, Kolkata-700 029

Phone Nos.: (033)2476-7350 to 54, 2454-1892/3 Fax Nos.: (033)2454-1961, 2474-7674; E-mail : [email protected], [email protected] b) For Redressal of Complaints and Grievances: The Secretary Telephone Nos. : (033) 2243-5453,2242-9454/2248-6607. Kesoram Industries Ltd., Fax No. : (033)2210-9455 9/1, R.N. Mukherjee Road, E-mail : [email protected] Kolkata-700001

II. COMPLIANCE OF NON-MANDATORY REQUIREMENTS : i) The Board: The Corporate Offi ce of the Company bears the expenses of the offi ce of the Chairman. Some of the independent Directors

have the tenure in aggregate on the Board of more than 9 years. ii) Remuneration Committee: The Company has re-constituted Remuneration Committee comprising of Shri B. P. Bajoria as a Chairman, Shri P.K.

Choksey and Shri P. K. Mallik being members as stated in item no.D of I above. iii) Shareholder Rights : Half yearly results including summary of the signifi cant events was sent during the year to the Shareholders of the

Company. iv) Audit qualifi cations: The Company at present does not have any qualifi cation pertaining to the Financial Statements other than technical

qualifi cation on remuneration of Shri Deepak Tandon, a Director, which is self-explanatory. v) Training of Board members: There was no Directors’ training programme during the year ended 31.03.2010. vi) Mechanism for evaluating non-executive Board members: Non-Executive Directors were being always evaluated by their own peer in the Board meetings during the year 2009-10,

although there was no formal peer group review by the entire Board except the Directors concerned. Vii) Whistle Blower Policy: The Company does not have any Whistle Blower Policy as of now but no personnel is being denied any access to the

Audit Committee.B. K. BIRLA Chairman



K. G. MAHESHWARI

Directors


30

DeclarationAll the Board members and the Senior Management personnel have affi rmed their compliance of the ‘Code of Conduct for Members of the Board and Senior Management’ for the period from 1st April, 2009 to 31st March, 2010 in terms of clause 49(I)(D)(ii) of the Listing Agreement with the Stock Exchanges.

Place: Sedam, Dist. GulbargaDated: 10.04.2010 ( K. C. Jain ) Chief Executive Offi cer

AUDITORS’ CERTIFICATE REGARDING COMPLIANCE OFCONDITIONS OF CORPORATE GOVERNANCETo the Members ofKesoram Industries LimitedWe have examined the compliance of conditions of Corporate Governance by Kesoram Industries Limited, for the year ended 31st March 2010, as stipulated in Clause 49 of the Listing Agreements of the said Company with stock exchanges in India.

The compliance of conditions of Corporate Governance is the responsibility of the Company’s management. Our examination was carried out in accordance with the Guidance Note on Certifi cation of Corporate Governance (as stipulated in Clause 49 of the Listing Agreement), issued by the Institute of Chartered Accountants of India and was limited to procedures and implementation thereof, adopted by the Company for ensuring the compliance of the conditions of Corporate Governance. It is neither an audit nor an expression of opinion on the fi nancial statements of the Company.

In our opinion and to the best of our information and according to the explanations given to us, we certify that the Company has complied with the conditions of Corporate Governance as stipulated in the above mentioned Listing Agreements. The Company has established risk assessment / minimisation and internal control procedures which are being updated / formalised.

We state that such compliance is neither an assurance as to the future viability of the Company nor the effi ciency or effectiveness with which the management has conducted the affairs of the Company.

Place: Kolkata For Price WaterhouseDate: 28th April, 2010 Firm Registration No. 301112E Chartered Accountants

(S. K. Deb)Partner

Membership No. 13390


31

ANNEXURE“B”REPORT ON MANAGEMENT DISCUSSION AND ANALYSISA. INDUSTRY STRUCTURE AND DEVELOPMENTCEMENTIndian Cement Industry continues to be the second largest cement producer in the world with installed capacity of 244.69 million Ton.The Indian Cement Industry had a growth of 12% in the year under review as compared to 8% in previous year in spite of the global fi nancial melt down affecting the entire world economy including India.During the year under review, Cement Industry has achieved capacity utilization of 85% as against 88% in preceding year, which has dropped mainly due to augmentation of new capacity.The cement production and consumption in India has recorded growth of 12% and 13% respectively over preceding year but the cement production and consumption in Southern Region, where both the cement Plants of the Company are situated have been only 9% & 5% respectively due to sizable addition of new capacity which has put pressure on Cement prices as well.TYREThe Indian Tyre Industry is mainly dominated by the organized sector and consists of fi ve major players who together account for approximately 85% of the Industry’s turnover. These companies have a presence in all the major segments of the Tyre Industry – the replacement market, Original Equipment Manufacturers (OEMs) as well as export and consequently, offer the consumer a well diversifi ed product mix.In the Indian Tyre Industry commercial vehicle tyres take the lead and account for approximately 65% of the Industry’s turnover. As a result, the growth of the entire Tyre Industry depends on primary factors like agricultural growth, overall GDP growth, industrial production, growth in vehicle demand and secondary factors like infrastructure development, prevailing interest rates and fi nancing options. Another signifi cant difference between the Indian and the global Tyre Industry is the extent of radialisation in the commercial vehicle tyres. Globally, commercial vehicle tyres are radialized to the extent of 70% as compared to India where the radialisation levels in this segment until last year was only 10%. However, this trend is gradually changing and it is expected that radialisation levels will go up to the extent of 20-25% in the next 2 years. The major domestic players have announced signifi cant expansion plans to meet the growing demand for commercial vehicle radial tyres.RAYON & TRANSPARENT PAPERThere is no growth in the production capacities in the country. The demand for Viscose Filament Yarn (VFY) is expected to be moderate in the short to medium term in view of the high competition with other fi bres and increased imports in the country.Further, the Transparent Paper (TP) manufacturing is not viable due to high cost of inputs, cheap substitutes resulting into restricted demand.Looking to erratic demand of both the products, there does not appear to be any further scope of development.SPUN PIPESThe Industry witnessed sluggish demand during the fi rst half of the year under review. While demand for pipes has picked up but Cast Iron pipes continue to face very stiff competition from Ductile pipes. As the section is under Suspension of Work since 2nd May 2008, no comments are made under the heads “Opportunities & Threats, Segmentwise Performance, Outlook and Risks & Concerns.”HEAVY CHEMICALSThe capacity utilization of Indian Caustic Soda Industry declined to around 67% during the year due to demand recession and huge import at dumping price. The Industry’s demand for imposition of safeguard duty – in addition to prevailing anti-dumping duty – has been favourably considered by the designated authority resulting in sharp decline in imports towards the end of the year.Capacity utilization in Sulphuric Acid Industry suffered in the fi rst half due to import of the product at throwaway prices. However, the situation improved in the second half due to increase in prices of Sulphur and Sulphuric Acid in International Market.B. OPPORTUNITIES AND THREATSCEMENTIn order to meet future demand for Cement, Industry has taken up large scale capacity expansion during the last three years and further substantial capacity addition is planned during next two years.

32

Creating world class road infrastructure for laying highways, road to rural connectivity, mass housing, urban development and projects for upliftment of rural economy etc. are some of the major thrust areas of Government and to achieve these objectives, Government has been increasing substantially its budget allocation in the last two years.Heavy augmentation in capacities by 70-80 million ton in next two to three years coupled with non-availability of good quality of coal and inadequate wagons for transportation are the main threats.TYREThe national thrust on road infrastructure, construction of expressways and national highways present a range of opportunities for the Tyre Industry. Creation of road infrastructure has given some fi llip to surface transportation. Emphasis on making India an Auto Centre for small cars also augurs well for the Industry. The Tyre industry will continue to play an important role in this dynamic and evolving situation.The volatility in raw material prices is the biggest threat.RAYON & TRANSPARENT PAPERThe curtailed production of VFY due to suspension of operations by few competitors created supply gap, which resulted in an opportunity to maintain the inventory. However, regular imports and stiff Chinese competition in International Market are the biggest threats to the VFY Industry.The TP segment is affected by slowdown in demand from ‘Fireworks’ Industry. Any increase in selling price due to increase in costs of inputs is threatened by diversion to cheaper alternatives.The volatility in raw material prices and imports from China, however, remains the biggest threat.HEAVY CHEMICALSOngoing capacity addition and Greenfi eld projects in Aluminium sector in Eastern India will improve demand for Caustic Soda in the coming years. Lower production cost of larger capacity Caustic Soda Plants in Eastern India may affect competitiveness of the Unit.C. OUTLOOKCEMENTEven though, India is the second largest cement producer in the world, the per capita cement consumption is only 156 Kg., as against the world average of 396 Kg. Therefore, there is enormous opportunity for the growth of Cement Industry. This country has huge potential for cement consumption growth, considering major emphasis of the Government on infrastructure development and boost to housing sector through measures like easy fi nance, provision of tax incentives etc.TYREFortune of Tyre Industry is linked to the automobile & transportation sectors. Future looks bright due to various economic fi llips by the government, large infrastructure spending and positive market sentiment.RAYON & TRANSPARENT PAPERThe sales outlook of VFY appears positive owing to signs of revival in consumer off-take. However, focus will continue to be on increasing share of value added yarn and improving yarn quality.Realisations of TP are expected to be under pressure due to cheap imports and substitutes. The Government should consider to provide some incentives to encourage bio-degradability and eco-friendly attributes of this product.HEAVY CHEMICALSImprovement in demand for joint products – Chlorine, Hydrochloric Acid and Hydrogen Gas was witnessed during the second half of the year under review, which is expected to be sustained and is likely to result in better realization for the products.D. RISKS AND CONCERNSCEMENTAlthough cement demand is expected to grow with economic growth, large capacity additions may create surplus capacity in the short term. Any unexpected slow down in the economic activity or deferment of large infrastructure projects will aggravate the situation and affect margin adversely.Cement Industry is heavily dependent on coal for its fuel requirement. While cement capacity is increasing continuously whereas the allotment of coal against linkages is decreasing. As a result, Cement Industry’s fuel cost is increasing due to purchase of coal from open market, E-auction or import of coal.


33

Similarly, short supply of Railway Wagons is also a major bottleneck, affecting outward movement of cement and inward movement of raw materials like gypsum, coal etc. Alternate Road Transport, only add to the inward and outward transport costs.TYREThe volatility in all major raw material prices and the inverted duty structure between tyres and natural rubber puts further pressure on the Industry’s revenue and profi tability.RAYON & TRANSPARENT PAPERThe revenue is likely to be impacted due to increased competition and rising input costs in both VFY & TP segments. Exports are likely to be affected due to subdued demand.HEAVY CHEMICALSSteep increase in power cost caused by rise in price of coal is a major concern as power constitutes around 65% of cost of production in Caustic Soda Industry.E. INTERNAL CONTROL SYSTEM AND THEIR ADEQUACYThe Company has proper and adequate systems of internal control, to safeguard all assets against loss from unauthorized use or disposition. These systems also ensure that all transactions are authorized, recorded and reported correctly. Regular internal audits and checks are carried out to provide assurance that adequate systems are in place and that the responsibilities at various levels are discharged effectively. The Management continuously reviews the internal control systems and procedures to obtain comfort regarding orderly and effi cient conduct of business. The review includes overseeing adherence to management policies, safeguarding the assets of the Company as well as ensuring the preparation of timely and accurate fi nancial information. The emphasis on internal control prevails across functions and processes, covering the entire gamut of activities including fi nance, supply chain, sales and distribution, marketing and the like. A strong system of internal audit supported by Internal and External Auditors and effective & comprehensive reviews by the Audit Committee have strengthened the internal control within the organization.F. MATERIAL DEVELOPMENT IN HUMAN RESOURCES AND INDUSTRIAL RELATIONSMeasures for safety of employees, training, welfare and development continue to get high priority at all levels, which are refl ected in the improved quality and effi ciency. Industrial relations have been cordial during the year under review except Spun Pipes Section, where the factory continues to be under suspension of work since 2nd May, 2008.G. The Company as a whole had 13,544 persons on its rolls as on 31.3.2010.H. CAUTION STATEMENTStatements in this report on Management Discussion and Analysis describing the Company’s objectives, projections, estimates, expectations or predictions may be forward looking statements within the meaning of applicable laws or regulations. These statements are based on certain assumptions and reasonable expectation of future events. Actual results could, however, differ materially from those expressed or implied. Important factors that could make a difference to the Company’s operations include global and domestic demand-supply conditions, fi nished goods prices, raw materials cost & availability, changes in Government regulations and tax structure, economic developments within India and the countries with which the Company has business contacts and other factors such as litigation and industrial relations.Thus, the Company should and need not be held responsible, if, which is not unlikely, the future turns to be something quite different. Subject to this management disclaimer, this discussion and analysis should be perused.




K. G. MAHESHWARI

Directors


34

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reside

nt(E

ngg.

& PP

)(V

asav

adatt

aCe

ment

Secti

on)

In-ch

arge o

fOp

eratio

ns,

Maint

enan

cean

d TPH

.

38,96

,230

57B.

E. (E

lec.)

15.01

.1986

36Ce

ment

Corpn

.of

India

Senio

r Eng

r.(E

lec.)

4Sh

ri Dee

pak T

ando

nDi

rector

, Sr. P

reside

nt (A

ccou

nts, F

inanc

e &

Taxa

tion),

Corp

orate

Offi c

e and

Birla

Tyres

(both

Balas

ore &

Ha

ridwa

r Sec

tions

)

Mana

geme

ntan

d ove

rall In

charg

e of

Corpo

rate O

ffi ce

& bo

th Se

ction

sof

Birla

Tyres

.

92,54

,604

51B.

Com

(Hon

s.),

F.C.A

.22

.02.19

9127

Centu

ry Pu

lp &

Pape

rGe

neral

Mana

ger

5Sh

ri D. S

. Bind

raPr

eside

nt(V

asav

adatt

aCe

ment

Secti

on)

Unit H

ead

42,49

,802

67B.

Sc.

(Mec

h.)10

.03.20

0745

Mang

alam

Ceme

nt Ltd

.Pr

eside

nt

6Sh

ri I. K

. Puro

hitSr

.Vice

Pres

ident

(Mark

eting

)(V

asav

adatt

aCe

ment

Secti

on)

In-ch

arge o

f sale

s&

marke

ting

28,29

,564

53B.

A., L

L.B.

17.06

.1983

27-

-

7Sh

ri J. P

. Boh

raSr

.Jt. P

reside

nt(R

ayon

& T.

P.Se

ction

s)

In-ch

arge o

f Co

mmerc

ialAc

tivitie

s &

Admi

nistra

tion

37,51

,078

61B.

Com.

(Hon

s),F.C

.A.

26.12

.1973

36S.

R. B

atlibo

i & C

o.Of

fi cer


35

Sl.

No.

Name

Desig

natio

nNa

ture

ofDu

ties

Gros

s rem

u-ne

ratio

n (Rs

.)Ag

e(Y

ears

)Qu

alifi c

ation

(s)Da

te of

Comm

ence

ment

of

emplo

ymen

t

Expe

rienc

e(N

o.of y

ears

)La

st em

ploym

ent h

eld

Name

of

the C

ompa

nyDe

signa

tion

8Sh

ri K. C

. Jain

Mana

ger o

f the

Comp

any &

Sr. P

reside

nt(C

emen

t Sec

tions

)

Mana

geme

ntan

d ove

rall

In-ch

arge.

72,73

,657

72B.

Com.

, F.C

.A.

19.02

.1966

46Sin

ghi &

Co.

Offi c

er

9Sh

ri K. L

. N. R

aoJt.

Pres

ident

(Tech

nical)

(Kes

oram

Ceme

nt Se

ction

)

In-ch

arge

ofTe

chnic

alma

tters.

32,60

,218

71B.

A., B

.Sc.

(Elec

t.)B.

I.T.

06.10

.1997

48

Suva

rna C

emen

tPr

eside

nt

10Sh

ri O.

P. S

harm

aSr

. Vice

Pres

ident

(Com

merci

al)(V

asav

adatt

aCe

ment

Secti

on)

In-ch

arge

ofPu

rchas

e.

28,94

,007

60B.

Sc.

15.04

.1971

39-

-

11Sh

ri P. M

ehta

Vice P

reside

nt(S

ales)

(Tyres

Sec

tions

)

In-ch

arge o

fDo

mesti

c Sale

s &

Mark

eting

(in N

orth I

ndia)

27,37

,656

51M.

A.17

.01.20

0824

Apoll

o Tyre

s Ltd.

Divis

ional

Head

12Sh

ri P.

R. S

harm

aJt.

Pres

ident

(Vas

avad

atta

Ceme

nt Se

ction

)

In-ch

arge

ofCo

mmerc

ialAc

tivitie

s &Ad

minis

tratio

n.

43,96

,784

67B.

Com.

19.04

.1967

48La

xmi F

inanc

eCo

rporat

ionAc

coun

tsOf

fi cer

13Sh

ri P. S

. Rao

Jt. P

reside

nt(P

rojec

t)(V

asav

adatt

aCe

ment

Secti

on)

In-ch

arge

ofPr

ojects

&Te

chnic

alma

tters.

33,56

,856

61B.

E.(M

ech.)

10.03

.2007

36Da

ngote

Grou

pof

Indus

tries,

Lago

s, Ni

geria

Gene

ralMa

nage

r

14Sh

ri R.

K. G

andh

iVic

e Pres

ident

(PQC

)(V

asav

adatt

aCe

ment

Secti

on)

In-ch

arge o

f Pr

oduc

tion &

Quali

ty Co

ntrol

24,43

,576

65B.

E.(C

h. En

gg.)

& D

. I. E

.26

.04.19

9335

C.C.

I. Ltd.

Mana

ger

(Proc

ess)

15Sh

ri R. K

. Sha

hJt.

Pres

ident

(Com

merci

al)(Ty

res S

ectio

ns)

In-ch

arge o

fCo

mmerc

ial,

Admi

nistra

tion &

Expo

rts

34,46

,212

49B.

Com.

, A.C

.A.,

A.I.C

.W.A

.01

.07.19

9623

Mode

rnSy

ntex L

td.V.P

. - Ba

nking

16Sh

ri S. C

. Trip

athy

Jt. P

reside

nt(Te

ch)

(Ray

on &

T.P.

Secti

ons)

In-ch

arge o

fTe

chnic

al ma

tters

24,77

,972

62B.

E.(H

ons)

Electr

ical,

PG D

iplom

a in

Ind. E

ngg.

30.05

.1985

40St

raw P

roduc

tsLim

ited

Mana

ger

(MS)

36

Sl.

No.

Name

Desig

natio

nNa

ture

ofDu

ties

Gros

s rem

u-ne

ratio

n (Rs

.)Ag

e(Y

ears

)Qu

alifi c

ation

(s)Da

te of

Comm

ence

ment

of

emplo

ymen

t

Expe

rienc

e(N

o.of y

ears

)La

st em

ploym

ent h

eld

Name

of

the C

ompa

nyDe

signa

tion

17Sh

ri S. R

. Cha

maria

Sr. J

t. Pres

ident

(Acc

ounts

& H

RD)

(Corp

orate

Offi c

e)

In-ch

arge o

f HRD

& Acc

ounts

-Co

rporat

e Offi c

e

26,45

,437

67M.

Com,

LL.B

., Sa

hitya

ratna

01.01

.1963

47

-

-

18Sh

ri S. V

. Tap

adia

Jt. P

reside

nt(F

in. &

Admn

.)(K

esora

mCe

ment

Secti

on)

In-ch

arge

ofCo

mmerc

ialAc

tivitie

s and

Admi

nistra

tion

40,19

,698

63B.

Com.

, F.C

.A.

20.10

.1971

39 -

-

b) E

mploy

ed fo

r par

t of t

he ye

ar an

d wer

e in r

eceip

t of r

emun

erati

on at

the r

ate of

not le

ss th

an R

s. 2,0

0,000

/- per

mon

thSl

.No

.Na

meDe

signa

tion

Natu

re of

Dutie

sGr

oss r

emu-

nera

tion (

Rs.)

Age

(Yea

rs)

Quali

fi cati

on(s)

Date

ofCo

mmen

ceme

nt

of em

ploym

ent

Expe

rienc

e(N

o.of y

ears

)La

st em

ploym

ent h

eld

Name

of

the C

ompa

nyDe

signa

tion

1Sh

ri J. D

. Palo

dSr

. Pres

ident

(Ray

on, T

.P.&

Heav

yCh

emica

lsSe

ction

s)

Mana

geme

ntan

d ove

rall

In-ch

arge.

63,82

,358

65B.

E. (M

ech.)

,AM

IE01

.01.19

8843

Hind

ustha

nHe

avy C

hemi

cals

Ltd.

Vice-

Pres

ident

(Tech

.)

2Sh

ri S. K

. Pari

kDi

rector

&Se

cretar

yMa

nage

ment

&Co

mpan

ySe

cretar

y

78,10

,019

78B.

Com.

, F.C

.A.,

F.C.S

.14

.07.19

5554

--

3Sh

ri V. N

. Cha

ndak

Pres

ident

(Ray

on, T

.P. &

Heav

y Che

mica

ls S

ectio

ns)

Mana

geme

ntan

d ove

rall

In-ch

arge

14,78

,255

73M.

Com,

L.L.B

.01

.11.20

0950

Easte

rn Sp

inning

Mills

& In

ds.Lt

dPr

eside

nt

Notes

:1.

All ap

point

ments

are c

ontra

ctual.

2. Re

mune

ration

rece

ived i

nclud

es sa

lary a

nd ot

her a

llowa

nces

, bon

us/ex

-grati

a, ren

t paid

, elec

tricity

charg

es pa

id, m

edica

l reim

burse

ments

, leav

e trav

el co

nces

sion,

enca

shme

nt of

leave

, Com

pany

’s co

ntribu

tion t

o prov

ident

fund,

gratui

ty fun

d and

supe

rannu

ation

fund

, prem

ium fo

r acc

ident

polic

y, clu

b fee

s and

the m

oneta

ry va

lue of

perqu

isites

with

rega

rd to

acco

mmod

ation

& fu

rnitur

e calc

ulated

in ac

corda

nce w

ith th

e prov

ision

s of In

come

Tax A

ct, 19

61 an

d the

rules

mad

e the

reund

er.3.

None

of th

e abo

ve em

ploye

es is

a rel

ative

of an

y dire

ctor o

f the C

ompa

ny.

4. Th

ere is

no em

ploye

e in t

he C

ompa

ny w

ithin

the m

eanin

g of s

ub-cl

ause

(iii) o

f clau

se (a

) of s

ub-se

ction

(2A)

of se

ction

217o

f the C

ompa

nies A

ct, 19

56.

5. Ot

her te

rms a

nd co

nditio

ns of

emplo

ymen

t inclu

de th

e tran

sfer o

f duti

es in

any s

ectio

n of th

e Com

pany

.


37

Annexure ‘D’INFORMATION AS REQUIRED UNDER SECTION 217(1)(e) READ WITH COMPANIES (DISCLOSURE OF PARTICULARS IN RESPECT OF BOARD OF DIRECTORS) RULES, 1988I. CONSERVATION OF ENERGY: (a) Energy conservation measures taken:

Installed Super Heater for waste heat recovery, steam heating in dryer in place of kerosene heating and vapour absorption Machine to create chilled water from waste heat.(Rayon & T.P. Sections). Installed gamma matrix, almag refractory, HR Separator for Cement Mill-2 and VVVF dry at Power Plant 2. Modifi ed sepol separator feeding scrapper plate in Cement Mill-3. Increased Raw Mill in-let duct size & converted the sharp edges to smooth curve. Reduced grinding media fi lling in the Mill. Eliminated Screw Conveyor of 22 KW from Cement Mill-3 circuit. Connected HR Separator of Cement Mill-3 outlet duct venting to Bag House Fan. Regulated the reject material of polycom back to circuit. Interlocked reverse Air Bag House Fan start with bag house DP, Feed HR grit materials to Mill in-let and replaced gear box of Kiln-2. (Vasavadatta Cement Section). Installed new Lime Stone secondary crusher of 400 TPH capacity for additional output per day. Modifi ed operating conditions in Kiln for easy grinding and reduced cyclone pressure drop in Coal Mill-1. (Kesoram Cement Section). Installed Variable Frequency Drives in various boiler feeds and utility water pumps, ID fans, high sensible air conditioners, VAM in place of compressor chiller unit, centrifugal compressors in place of reciprocating compressors. DM water heated through steam recovery from Tyre Curing presses. LP air used in place of MP air in boiler ash handling system. (Tyre Sections). Modifi ed / incorporated Variable Frequency Drives on cooling tower’s water feed pumps and returned water pumps of rectifi er transformers cooling circuit. Installed energy effi cient lights in place of HPMV lamps. Modifi ed capacitor bank and retained TOD meter in grid supply. (Hindusthan Heavy Chemicals Section).

(b) Additional investment proposals, if any, being implemented for reduction of consumption of energy:

Installation of mist cooling tower & vacuum ejectors to conserve water, application of Variable Frequency Drives in cooling tower and mist condensers for saving steam.(Rayon & T.P. Sections). Installation of Roller Press and HR separator for Line-I Cement Mill, rotoscale for coal dosing for Line-II & Kiln feed for Line-I, curing tanks for temperature control, XRF and XRD for quality control and coal integration for Line-IV to Line-I to cut the shut down time.(Vasavadatta Cement Section). Installation of N-2000 O-sepa in Cement Mill-3. Replacement of existing Kiln-II cooler with latest energy effi cient cooler. Reduction of pressure drop in Kiln-II pre-heater and Kiln-I C-Line no.II cyclone, fugitive dust emission in Cement Mill and cool crusher and upgradation of blending silos for steady operation of Kilns. (Kesoram Cement Section). Installation of Variable Frequency Drives in various utility pumps, auto on/off with line running feed back in dual extruders for chilled water supply. Increase in suction line of all utility pumps, overhead line in close loop for chilled water return from plant equipment, hot water recovery from curing presses. Condensate to be recovered from curing presses of Motor Cycle Plant and Tube Plant.(Tyre Sections).

(c) Impact of measures at (a) & (b) above for reduction of energy consumption and consequent impact on the cost of production of goods :

Reduction in consumption of electricity and coal consumption per unit of production were witnessed in general having favourable impact on the cost of production.

(d) Total energy consumption and energy consumption per unit of production as per Form “A” of the Annexure in respect of industries specifi ed in the Schedule thereto.

FORM ‘A’FORM FOR DISCLOSURE OF PARTICULARS WITH RESPECT TO CONSERVATION OF ENERGY

(A) Power and Fuel Consumption Current Year Previous Year(1) Electricity

(a) Purchased Units (in lacs) 1,493.53 1,401.36Total Amount (Rs. in lacs) 6,291.68 5,614.60Rate/Unit (Rs.) 4.21 4.01

38

Current Year Previous Year(b) Own Generation

(i) Through Diesel Generator Units (in lacs) 36.77 29.54 Units per Ltr. of diesel oil 3.13 2.93 Cost/Unit (Rs.) 9.41 10.43(ii) Through Steam Turbine/ Generator Units (in lacs) 7,304.93 5,649.52 Unit per Kg. of Coal 1.01 0.94 Cost/Unit (Rs.) 2.64 2.89

(2) Coal (Grade B, C, D, E, F steam/ slack, ROM, Lignite and Grade-A steam Coal used in Boiler Houses, calcining of raw meals, fi ring of Kiln and gas plant)

Quantity (MT) 18,43,175 14,80,763Total Cost (Rs. in lacs) 55,527.46 47,646.68Average Rate/MT (Rs.) 3,012.60 3,217.71

(3) Furnace OilQuantity (K.Ltrs.) 396.85 4,637.79Total Cost (Rs. in lacs) 120.76 1,507.94Average Rate/Ltr. (Rs.) 30.43 32.51

(4) Othersi) HSD Oil

Quantity (K.Ltrs.) 359.31 309.61Total Cost (Rs. in lacs) 112.94 97.55Rate/Ltr. (Rs.) 31.43 31.51

ii) GasQuantity (MT) 2,090.84 -Total Cost (Rs. in lacs) 900.16 -Rate/Ltr. (Rs.) 43.05 -

iii) Diesel OilQuantity (K.Ltrs.) 1,151.20 2,251.34Total Cost (Rs. in lacs) 335.60 690.79Rate/Ltr. (Rs.) 29.15 30.68

(B) Consumption per Unit of Production ProductionUnit

Standardsif any

Current Year Previous Year

1. Electricity (kwh)Vis. Filament Rayon Yarn M.T. - 4,168 4,198 (b)Transparent Paper (Cellulose Film) M.T. - 2,155 2,255 (b)Sulphuric Acid M.T. - 39 41 (b)Caustic Soda M.T. - 3,747 3,760 (c)Purifi ed Hydrogen Gas M3 - 0.40 0.39 (c)Sodium Hypochloride M.T. - 38 37 (c)Carbon-di-Sulphide M.T. - 1,065 1,111 (b)Sodium Sulphate M.T. - 91 92 (c)Sodium Sulphide M.T. - 285 285Cement M.T. - 77 78 (b)Tyres, Tubes & Flaps M.T. - 1,096 1,112 (a)


39

ProductionUnit

Standardsif any

Current Year Previous Year

2. CoalVis. Filament Rayon Yarn M.T. - 3.75 3.77 (c) Transparent Paper (Cellulose Film) M.T. - 6.69 6.25 (d)Carbon-di-Sulphide M.T. - 0.33 0.36 (b)Sodium Sulphate M.T. - 0.35 0.36 (c)Cement M.T. - 0.15 0.15Tyres, Tubes & Flaps M.T. - 1.09 1.31 (a)

3. Furnace OilTyre, Tubes & Flaps K.L. - 0.004 0.02 (e)

4. Othersi) HSD Oil Cement L. - 0.074 0.078 (e)ii) Gas Tyres, Tubes & Flaps M.T. - 0.0114 -

Reasons of variation:(a) Energy conservation measures taken.(b) Better production.(c) Difference considered normal.(d) Inferior quality of coal.(e) Lesser use.

N.B. : 1. Form ‘A’ not applicable to Spun Pipes Section. 2. Previous year’s fi gures have been re-arranged where necessary.

II. TECHNOLOGY ABSORPTION : Efforts made in technology absorption as per Form ‘B’ of the Annexure.

FORM ‘B’1. Research & Development (R&D)

(a) Specifi c areas in which R&D carried out Use of fl ash Deaerator at different temperatures to remove air from Viscose and setting proper angle in traverse mechanism of coning machine. (Rayon & T. P. Sections). R&D cell continued to work for improving the quality and productivity with special attention on energy conservation. (Cement Sections). Development of motor cycle tyre, truck radial & OTR tyres.(Tyre Sections).

(b) Benefi ts derived as a result of above R&D Elimination of top edged broken fi lament in cones and less air in Viscose resulting in lesser broken fi lament.(Rayon and T.P. Sections). Improvement in output and quality.(Cement Sections). New range of products developed for both domestic and export markets.(Tyre Sections).

(c) Future Plan of Action Study of process chemicals in after-treatment and plan to use different chemicals to reduce broken fi lament in the yarn. (Rayon and T.P. Sections). Installation of Waste Heat recovery system, conversion of existing ESP to Reverse Air Bag House for line I & II and utilizing alternate fuels for Kiln. (Cement Sections). Introduction of variety in the range of products to cope with the ever changing market requirement. (Tyre Sections).

40

(d) Expenditure on R&D No separate allocation in the company. However, the company paid a cess @ Re.0.75 per tonne of cement despatched to the Development Commissioner for Cement Industry, Government of India, who in turn assists fi nancially to National Council of Cement & Building Materials to carry out Research & Development Programmes in the interest of the Cement Industry. During the year 2009-10 the Company paid Rs.41.69 lacs to the said authority. (Cement Sections).

(i) Capital - NIL(ii) Recurring - NIL(iii) Total - NIL(iv) Total R&D expenditure as a percentage of total turnover

2. Technology Absorption, Adaptation and Innovation

(a) Efforts, in brief, made towards technology absorption, adaptation and innovation

Installed automatic Sodium Sulphate Bagging System, pyramid plate and slow speed dissolving process of Viscose.(Rayon and T.P. Sections). Reduced Coal Mill cyclone pressure drop and installed secondary crusher at Kesoram Cement Section. Efforts are being made for enhancement of productivity and energy conservation. Executives/ Employees are being regularly deputed for attending seminars and workshops on Research & Development studies to keep them abreast of the latest technical developments.(Cement Sections). Technology imported from M/s.Pirelli & Co.has been fully adapted to. (Tyre Sections).

(b) Benefi ts derived as a result of the above efforts e.g. product improvement, cost reduction, product development, import substitution etc.

Improvement in viscose quality & saving of man power.(Rayon and T.P. Sections). Optimum capacity utilization with reduced power consumption.

3. In case of imported technology (imported during last 5 years reckoned from the beginning of the fi nancial year), following information may be furnished :(i) Technology imported(ii) Year of import Not Applicable(iii) Has technology been fully absorbed ?

III. FOREIGN EXCHANGE EARNINGS & OUTGO :1. Activities relating to exports, initiatives taken to

increase exports, development of new export markets for products and services and export plans.

Increased exports of VFY by about 17% by exploring new markets of Brazil and Argentina. Export of T.P. was lower by 4% due to cheaper substitute available from other Countries. Plan is to increase export by further exploring new markets. (Rayon & T.P. Sections).Exports were made to 26 countries including Bangladesh, Pakistan, Vietnam, Middle East & Philippines etc. during the year under reference and efforts are being made to explore new markets.(Tyre Sections).

2. Total Foreign Exchange used and earned -Used Rs 78,441.26 lacs (excluding Rs.3,694.29 lacs being interest).Earned (on F.O.B. realisation basis) Rs 37,503.67 lacs




K. G. MAHESHWARI

Directors



41

Summarised Balance Sheet for the Last Five Years(Rupees in Crore)

2009-10 2008-09 2007-08 2006-07 2005-06

A. ASSETS OWNED BY THE COMPANY

1. Net Fixed Assets

Gross Fixed Assets 4,926.99 3,582.42 2,530.04 1,827.12 1,423.53

Less: Total Depreciation 1,082.34 913.22 811.20 721.93 680.31

3,844.65 2,669.20 1,718.84 1,105.19 743.22

2. Investments 51.43 61.78 47.83 28.87 29.02

3. Inventories 916.19 589.06 442.17 376.88 255.19

4. Sundry Debtors 542.89 380.17 273.07 245.95 184.37

5. All other Current Assets 398.05 292.46 491.01 245.28 170.25

Total Assets 5,753.21 3,992.67 2,972.92 2,002.17 1,382.05

B. (i) DUES TO BE PAID BY THE COMPANY

1. Secured Loans 1,863.72 1,536.27 971.06 643.20 413.37

2. Unsecured Loans and Deposits 1,477.20 605.65 243.75 229.60 207.99

3. Other Liabilities 528.62 363.11 303.03 226.83 161.23

4. Provisions 14.99 31.39 330.39 135.70 76.22

5. Deferred Tax Liabilities (Net) 328.44 126.15 142.77 112.41 107.19

4,212.97 2,662.57 1,991.00 1,347.74 966.00

(ii) THEREFORE, COMPANY’S NET WORTH

REPRESENTED BY

1. Ordinary Share Capital 45.74 45.74 45.74 45.74 45.74

2. Reserves & Surplus 1,494.50 1,284.36 936.18 608.69 370.31

1,540.24 1,330.10 981.92 654.43 416.05

Figures for the previous year(s) have been regrouped/rearranged where considered necessary.

42

Summarised Profi t & Loss Account for the Last Five Years(Rupees in Crore)

2009-10 2008-09 2007-08 2006-07 2005-06

RECEIPTS1. Sales (including Excise Duty) 5,020.63 4,292.07 3,440.32 2,516.46 1,877.822. Other Income 119.04 67.92 36.90 45.45 43.783. Increase/(Decrease) in Stock 173.07 87.96 40.88 15.07 -25.93

Total Receipts 5,312.74 4,447.95 3,518.10 2,576.98 1,895.67

EXPENDITURES1. Raw Materials and other purchases 2,405.30 1,741.47 1,146.62 936.06 735.222. Stores and Power 725.26 641.25 473.42 288.63 267.343. Salary, Wages and other Amenities 225.29 180.21 153.24 128.60 115.794. Excise Duty 299.97 409.64 454.29 307.49 264.645. Sales Expenses 649.91 554.56 450.19 372.52 275.076. Manufacturing and other Miscellaneous

Expenses 255.72 286.98 146.43 113.68 82.317. Interest (Net) 103.00 112.85 52.11 29.91 22.79

Total Expenses 4,664.45 3,926.96 2,876.30 2,176.89 1,763.16

GROSS PROFIT 648.29 520.99 641.80 400.09 132.51648.29 520.99 641.80 400.09 132.51

APPROPRIATIONS/TRANSFERS1. Depreciation (Net) 172.80 111.87 89.27 58.31 51.572. Provision for Taxation 36.00 45.00 165.00 75.00 34.003. Provision for Deferred Tax 202.29 -16.62 2.81 --- ---4. Provision for Fringe Benefi t Tax -0.13 2.00 1.37 1.10 1.235. Transfer to Debenture Redemption Reserve 101.25 25.00 --- --- ---6. Interim Dividend (with Distribution Tax thereon) 12.03 12.04 --- --- ---7. Proposed Dividend (with Distribution Tax thereon) 17.34 17.40 29.43 20.86 15.658. Reserves 24.00 44.78 40.00 30.00 5.009. Surplus/(Defi cit) 82.71 279.52 313.92 214.82 25.06

648.29 520.99 641.80 400.09 132.51

Figures for the previous year(s) have been regrouped/rearranged where considered necessary.


43

AUDITORS’ REPORTTO THE MEMBERS OF KESORAM INDUSTRIES LIMITED

1. We have audited the attached Balance Sheet of Kesoram Industries Limited (the “Company”) as at 31st March, 2010, the related Profi t and Loss Account and Cash Flow Statement for the year ended on that date annexed thereto, which we have signed under reference to this report. These fi nancial statements are the responsibility of the Company’s Management. Our responsibility is to express an opinion on these fi nancial statements based on our audit.

2. We conducted our audit in accordance with the auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the fi nancial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the fi nancial statements. An audit also includes assessing the accounting principles used and signifi cant estimates made by Management, as well as evaluating the overall fi nancial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditor’s Report) Order, 2003, as amended by the Companies (Auditor’s Report) (Amendment) Order, 2004, issued by the Central Government of India in terms of Section 227 (4A) of ‘The Companies Act, 1956’ of India (the ‘Act’) and on the basis of such checks of the books and records of the Company as we considered appropriate and according to the information and explanations given to us, we further report that :

3.1 (a) The Company is maintaining proper records showing full particulars (other than details regarding revaluations made during 1982-83) including quantitative details and situation of its fi xed assets.

(b) The fi xed assets of the Company are physically verifi ed by the Management according to phased programmes designed to cover all the items over a period of three years, which in our opinion, is reasonable having regard to the size of the Company and the nature of its assets. Pursuant to such programmes [without any coverage for items of Company’s Spun Pipes & Foundries Unit (which is under suspension of work effective 2nd May, 2008 having year-end book value of Rs.4,09,93,039)], a portion of the fi xed assets has been physically verifi ed by the Management during the year and no material discrepancies between the book records and the physical inventory have been noticed.

(c) In our opinion and according to the information and explanations given to us, a substantial part of fi xed assets has not been disposed off by the Company during the year.

3.2 (a) The inventories [excluding stocks with third parties and pertaining to the aforesaid Spun Pipes & Foundries Unit (year-end book value Rs. 99,23,767)] have been physically verifi ed by the Management during the year. In respect of inventory lying with third parties, these have substantially been confi rmed by them. In our opinion, the frequency of physical verifi cation is reasonable.

(b) In our opinion, the procedures of physical verifi cation of inventories followed by the Management are reasonable and adequate in relation to the size of the Company and nature of its business.

(c) On the basis of our examination of the inventory records, in our opinion, the Company is maintaining proper records of inventories other than work-in-process. As in earlier years, work-in-process has been determined by the Management on the basis of physical verifi cation as mentioned in paragraph 3.2 (a) above. The discrepancies noticed on physical verifi cation of inventory as compared to book records were not material.

3.3 The Company has neither granted nor taken during the year any loans, secured or unsecured, to / from companies, fi rms or other parties covered in the register maintained under Section 301 of the Act.

3.4 In our opinion and according to the information and explanations given to us, there is an adequate internal control system commensurate with the size of the Company and the nature of its business for the purchase of inventory, fi xed assets and for the sale of goods. The Company has not provided any service during the year. Further, on the basis of our examination of the books and records of the Company and according to the information and explanations given to us, we have neither come across nor have we been informed of any continuing failure to correct major weaknesses in the aforesaid internal control system.

44

3.5 (a) In our opinion and according to the information and explanations given to us, the particulars of contracts or arrangements referred to in Section 301 of the Act have been entered in the register required to be maintained under that Section.

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contracts or arrangements and exceeding the value of rupees fi ve lakhs in respect of any party during the year, have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time other than transactions of special nature for which competitive quotations are not available.

3.6 In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of Sections 58A and 58AA or any other relevant provisions of the Act and the Companies (Acceptance of Deposits) Rules, 1975 with regard to the deposits accepted from the public. According to the information and explanations given to us, no order has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal on the Company in respect of the aforesaid deposits.

3.7 In our opinion, the Company has an internal audit system commensurate with its size and nature of business.

3.8 We have broadly reviewed the books of account maintained by the Company in respect of products at its Cement, Tyre, Rayon and Chemicals Units where, pursuant to the Rules made by the Central Government of India, the maintenance of cost records has been prescribed under Section 209(1)(d) of the Act and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained. We have not, however, made a detailed examination of the records with a view to determine whether they are accurate or complete.

3.9 (a) According to the information and explanations given to us and the records of the Company examined by us, in our opinion, the Company is generally regular in depositing the undisputed statutory dues including provident fund, investor education and protection fund [other than arrears of Rs. 56,307 (pertaining to cases under litigation) outstanding for a period of more than six months as on 31st March, 2010], employees’ state insurance, income-tax (other than arrears of Rs. 19,23,892 outstanding for a period of more than six months as on 31st March, 2010), sales tax, wealth tax, service tax, custom duty, excise duty, cess and other material statutory dues as applicable with the appropriate authorities.

(b) According to the information and explanations given to us and the records of the Company examined by us, the particulars of dues of income-tax, sales-tax, wealth tax, service tax, custom duty, excise duty and cess as at 31st March, 2010 which have not been deposited on account of a dispute (there being no such cases with regard to wealth tax, custom duty and cess), are as follows –

Name of the Statute Nature of the dues

Amount Rs.

Period to which the amount relates

Forum wheredispute is pending

Income Tax Act, 1961 Income Tax 50,000 2000-01 CommissionerCentral Sales Tax Act, 1956 Sales Tax 16,99,42,317 2000-01 to 2002-03 Supreme Court

3,07,99,841 2001-02, 2003-04, 2004-05, 2006-07

Orissa High Court

4,65,12,981 2003-04 Karnataka High Court2,62,95,867 1999-00, 2003-04,

2004-05West Bengal Commercial TaxesAppellate and Revisional Board

29,25,145 1991-92 to 2002-03 Tribunal1,47,85,118 2006-07 Sr. Joint Commissioner

28,37,124 2005-06, 2007-08 Commissioner4,48,082 1999-00 Additional Commissioner

6,23,26,761 1997-98, 2001-02, 2003-04 to 2005-06

Deputy Commissioner

42,92,465 1991-92 to 2001-02, 2004-05

Assistant Commissioner

West Bengal Sales Tax Act, 1994

Sales Tax 2,62,30,154 1987-88, 2003-04,2004-05

West Bengal Commercial TaxesAppellate and Revisional Board


45

Name of the Statute Nature of the dues

Amount Rs.

Period to which the amount relates

Forum wheredispute is pending

5,72,943 1999-00 Additional Commissioner2,83,64,540

1995-96, 1997-98,1999-00, 2001-02,2003-04, 2004-05,

2008-09

Deputy Commissioner

Delhi Sales Tax Act, 1975 Sales Tax 41,70,263 1999-00 Additional CommissionerJammu & Kashmir Sales Tax Act, 1962

Sales Tax 9,90,252 1999-00 Deputy Commissioner

Tamil Nadu General Sales Tax Act, 1959

Sales Tax 18,07,934 1999-00 Chennai High Court

Andhra Pradesh General Sales Tax Act, 1957

Sales Tax 25,66,651 2001-02 Tribunal

Madhya Pradesh Commercial Tax Act, 1994

Sales Tax 6,36,696 2000-01 Deputy Commissioner

U.P. Trade Tax Act, 1948 Sales Tax 8,88,138 2005-06, 2006-07 Additional CommissionerFinance Act, 1994 Service Tax 3,85,55,392 2005-06 to 2007-08 Customs Excise & Service Tax

Appellate TribunalCentral Excise Act, 1944 Excise Duty 1,72,232 1993-94, 1994-95 Calcutta High Court

4,96,64,997 2003-04 to 2007-08 Customs Excise & Service Tax Appellate Tribunal

8,63,13,775 1986-87 to 1989-90.1994-95 to 1996-97,1999-00, 2000-01,2002-03 to 2005-06

Commissioner

19,43,327 2003-04 Deputy Commissioner18,86,987 1979-80 to 1982-83,

1995-96, 2001-02 to 2004-05

Assistant Commissioner

3.10 The Company has no accumulated losses as at 31st March, 2010 and it has not incurred any cash losses in the fi nancial year ended on that date and in the immediately preceding fi nancial year.

3.11 According to the records of the Company examined by us and the information and explanations given to us, the Company has not defaulted in repayment of dues to any fi nancial institution or bank or debenture holders as at the Balance Sheet date.

3.12 The Company has not granted any loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

3.13 The provisions of any special statute applicable to chit fund/ nidhi/ mutual benefi t fund/ societies are not applicable to the Company.

3.14 In our opinion, the Company is not a dealer or trader in shares, securities, debentures and other investments.

3.15 In our opinion, and according to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from banks or fi nancial institutions during the year.

3.16 In our opinion, and according to the information and explanations given to us, the term loans have been applied for the purposes for which they were obtained other than term loans in the region of Rs. 100 crores (obtained towards the end of the fi nancial year) which, according to management, has been temporarily used for working capital purposes / repayment of certain short term borrowings pending eventual utilization for specifi c purposes.

46

3.17 On the basis of an overall examination of the Balance Sheet of the Company, in our opinion and according to the information and explanations given to us, there are no funds raised on a short-term basis which have been used for long-term investment.

3.18 The Company has not made any preferential allotment of shares during the year.

3.19 The Company has not created any security or charge in respect of Short-term debentures aggregating Rs.145 Crores issued during the year and outstanding at year-end. The Company has not created security or charge in respect of short term debentures issued and repaid during the year. The Company has created security or charge (other than mortgage on certain immovable properties of the Company) in respect of long term debentures aggregating Rs. 1,00,00,00,000 issued during the year and outstanding at year end.

3.20 The Company has not recently raised any money by public issues.

3.21 During the course of our examination of the books and records of the Company, carried out in accordance with the generally accepted auditing practices in India, and according to the information and explanations given to us, we have neither come across any instance of fraud on or by the Company, noticed or reported during the year, nor have we been informed of such case by the Management.

4. Further to our comments in paragraph 3 above, we report that:

(a) We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary for the purposes of our audit;

(b) In our opinion, proper books of account as required by law have been kept by the Company so far as appears from our examination of those books;

(c) The Balance Sheet, Profi t and Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of account;

(d) In our opinion, the Balance Sheet, the Profi t and Loss Account and the Cash Flow Statement dealt with by this report comply with the accounting standards referred to in Section 211(3C) of the Act;

(e) On the basis of the written representations received from the directors as on 31st March, 2010, and taken on record by the Board of Directors, none of the directors is disqualifi ed as on 31st March, 2010 from being appointed as a director in terms of Section 274 (1) (g) of the Act;

(f) In our opinion and to the best of our information and according to the explanations given to us, the said fi nancial statements together with the notes thereon and attached thereto give, in the prescribed manner, the information required by the Act, and subject to Note 7(c) regarding Director’s remuneration of Rs. 27,59,365 for which shareholders’ approval is yet to be obtained, give a true and fair view in conformity with the accounting principles generally accepted in India:

(i) in the case of the Balance Sheet, of the state of the affairs of the Company as at 31st March, 2010;

(ii) in the case of the Profi t and Loss Account, its profi t for the year ended on that date; and

(iii) in the case of the Cash Flow Statement, of the cash fl ows for the year ended on that date.

For Price WaterhousePlace: Kolkata Firm Registration No. 301112EDate: 28th April, 2010 Chartered Accountants

(S. K. Deb)Partner

Membership No. 13390


47

ACCOUNTS

48

Balance Sheet as at 31st March, 2010

ScheduleRs.

31st March, 2010Rs.

31st March, 2009Rs.

I. SOURCES OF FUNDS(1) SHAREHOLDERS’ FUNDS

(a) Capital 1 45,74,16,395 45,74,16,395 (b) Reserves and Surplus 2 14,94,49,93,646 12,84,36,32,750

15,40,24,10,041 13,30,10,49,145(2) LOAN FUNDS

(a) Secured Loans 3 18,63,71,52,800 15,36,26,89,794 (b) Unsecured Loans 4 14,77,20,35,851 6,05,65,00,732

33,40,91,88,651 21,41,91,90,526DEFERRED TAX LIABILITY (NET) [Note 6 on Schedule 17] 3,28,43,82,864 1,26,14,75,335

52,09,59,81,556 35,98,17,15,006II. APPLICATION OF FUNDS

(1) FIXED ASSETS 5 (a) Gross Block 45,14,16,04,666 27,17,56,66,830 (b) Less: Depreciation 10,82,33,98,332 9,13,21,93,666 (c) Net Block 34,31,82,06,334 18,04,34,73,164 (d) Capital Work-in-Progress 4,12,83,32,523 8,64,85,27,277

38,44,65,38,857 26,69,20,00,441(2) INVESTMENTS 6 51,43,36,876 61,78,09,596(3) CURRENT ASSETS, LOANS AND ADVANCES

(a) Inventories 7 9,16,19,41,383 5,89,06,12,970 (b) Sundry Debtors 8 5,42,88,86,145 3,80,17,05,637 (c) Cash and Bank Balances 9 80,44,88,277 56,85,52,594 (d) Other Current Assets 10 30,13,37,962 22,36,41,866 (e) Loans and Advances 11 2,87,46,21,844 2,13,24,11,958

18,57,12,75,611 12,61,69,25,025Less: CURRENT LIABILITIES AND PROVISIONS

12

(a) Current Liabilities 5,28,62,44,550 3,63,11,25,661 (b) Provisions 14,99,25,238 31,38,94,395

5,43,61,69,788 3,94,50,20,056 Net Current Assets 13,13,51,05,823 8,67,19,04,969

52,09,59,81,556 35,98,17,15,006 Notes on the Accounts 17

The Schedules referred to above form an integral part of the Balance Sheet.This is the Balance Sheet referred to in our report of even date.



For Price WaterhouseFirm Registration No. 301112 E

Chartered Accountants(S.K. DEB)

PartnerMembership No. 13390

DEEPAK TANDONWhole-time Director

S.K.PATODIA Secretary

K. G. MAHESHWARI

Directors

B. P. BAJORIAP. K. CHOKSEYG. B. PANDEAMITABHA GHOSHP. K. MALLIKMANJUSHREE KHAITAN


49

Profi t and Loss Account for the year ended 31st March, 2010

ScheduleRs.

2009-2010Rs.

2008-2009Rs.

INCOMESales 50,20,63,31,903 42,92,06,86,229Less: Excise Duty 2,89,97,85,846 4,14,34,65,940Net Sales 47,30,65,46,057 38,77,72,20,289Other Income 13 1,25,06,67,722 75,93,98,846

48,55,72,13,779 39,53,66,19,135EXPENDITURE

Raw Materials and Finished Goods 14 22,32,23,47,484 16,53,51,71,038Manufacturing, Selling and Administrative Expenses 15 18,66,16,06,783 16,58,30,22,170Depreciation 1,73,53,16,026 1,13,05,95,945Less: Transfer from Capital Reserve- Revaluation of Fixed Assets 73,12,588 1,20,34,878

[Note 1(b) (iv) on Schedule 17] 1,72,80,03,438 1,11,85,61,067Interest 16 1,09,03,12,626 1,20,87,21,809

43,80,22,70,331 35,44,54,76,084

PROFIT BEFORE TAXATION 4,75,49,43,448 4,09,11,43,051Provision for Current Taxation [Note 13 on Schedule 17] 36,00,00,000 45,00,00,000Provision for Deffered Tax [charge/(credit)] [Note 6 on Schedule 17] 2,02,29,07,529 (16,62,66,850)Provision for Fringe Benefi t Tax [charge/(credit)] (13,38,258) 2,00,00,000

PROFIT AFTER TAXATION 2,37,33,74,177 3,78,74,09,901Transfer to Debenture Redemption Reserve (Net) [Notes 18.1, 18.2 & 19.3 on Schedule 17]

1,01,25,00,000 25,00,00,000

PROFIT AVAILABLE FOR APPROPRIATION 1,36,08,74,177 3,53,74,09,901APPROPRIATIONS

Proposed Dividend 14,86,65,784 14,86,65,784Tax on Proposed Dividend 2,46,91,900 2,52,65,750Interim Dividend 10,29,22,466 10,29,22,466Tax on Interim Dividend 1,74,91,673 1,74,91,673General Reserve 24,00,00,000 44,78,16,845

53,37,71,823 74,21,62,518Balance carried to Schedule 2 82,71,02,354 2,79,52,47,383

Earnings per Share (Basic and Diluted) [Note 23 on Schedule 17] 51.88 82.80

Notes on the Accounts 17The Schedules referred to above form an integral part of the Profi t and Loss Account.This is the Profi t and Loss Account referred to in our report of even date.








K. G. MAHESHWARI

Directors


50

SCHEDULE 1CAPITAL 31st March, 2010

Rs.31st March, 2009

Rs.AUTHORISED

50,00,000 Redeemable Cumulative Preference Shares of Rs. 100 each 50,00,00,000 50,00,00,0004,00,000 Redeemable Cumulative Second Preference Shares of Rs. 100 each 4,00,00,000 4,00,00,000

6,60,00,000 Ordinary Shares of Rs. 10 each 66,00,00,000 66,00,00,0001,20,00,00,000 1,20,00,00,000

ISSUED, SUBSCRIBED AND PAID-UP4,57,43,318 Ordinary Shares of Rs. 10 each fully paid up 45,74,33,180 45,74,33,180

Out of the above :- 5,75,435 shares of Rs. 10 each allotted as fully paid up

without payment being received in cash pursuantto a scheme of amalgamation

59,49,480 shares of Rs. 10 each allotted as fully paid upbonus shares by way of capitalisation of Reserve

4,00,000 shares of Rs. 10 each - Rs. 3.75 per share receivedin cash and balance credited as bonus by way ofcapitalisation of Reserve

Less: Allotment Money receivable 16,785 16,785 45,74,16,395 45,74,16,395

SCHEDULE 2RESERVES AND SURPLUS

Balance as at Balance as at31st March, 2009 Additions Deductions 31st March 2010

Rs. Rs. Rs. Rs.CAPITAL RESERVES

Revaluation of Fixed Assets 4,12,15,940 - 73,24,458 (a) 3,38,91,482Development Grant/ Subsidy 40,60,625 - - 40,60,625Amalgamation Reserve - 2,91,13,990 (b) - 2,91,13,990

CAPITAL REDEMPTION RESERVE 3,58,81,176 - - 3,58,81,176DEBENTURE REDEMPTION RESERVE 25,00,00,000 1,26,25,00,000 (c) 25,00,00,000 (d) 1,26,25,00,000SHARE BUY BACK RESERVE 7,00,73,060 - - 7,00,73,060REVENUE RESERVES

General 2,00,00,00,000 24,00,00,000 - 2,24,00,00,000Doubtful Debts & Contingencies 20,00,000 - - 20,00,000

2,40,32,30,801 1,53,16,13,990 25,73,24,458 3,67,75,20,333

Profi t and Loss Account 10,44,04,01,949 82,71,02,354 30,990 (e) 11,26,74,73,31312,84,36,32,750 14,94,49,93,646

(a) Comprising -(i) Additional depreciation charge on revalued fi xed assets transferred to Profi t and Loss Account [Note 1(b) (iv) on Schedule 17] 73,12,588(ii) Adjustment relating to fi xed assets withdrawn 11,870

73,24,458(b) Arising out of amalgamation (Note 2.3 on Schedule 17)(c) Refer Notes 18.2 and 19.3 on Schedule 17(d) Refer Note 18.1 on Schedule 17(e) Adjustment consequent to amalgamation (Note 2.3 on Schedule 17)


51

SCHEDULE 3SECURED LOANS

Nature of Loans Nature of Security 31st March, 2010Rs.

31st March, 2009Rs.

I. 13% Redeemable Non Convertible Debentures[Note 18.1 on Schedule 17]

First charge by way of hypothecation/mortgage on all the present and future current assets (save and except book debts and current assets hypothecated to banks in the ordinary course of business for working capital requirement) and movable/ immovable properties (mortgage not created on immovable properties at Uttarakhand of Company’s Tyre Unit) of all Units of the Company on pari passu basis with other lenders.

- 1,00,00,00,000

7.30% Redeemable Non Convertible Debentures[Note 18.2 on Schedule 17]

Hypothecation/mortgage (since created) on all the present and future movable (save and except book debts) / immovable properties (including mortgage to be created on immovable properties at Uttarakhand of Company’s Tyre Unit) of all Units of the Company on pari passu basis with other lenders.

1,00,00,00,000 -

II. Term Loans from - State Bank of India Hypothecation/ mortgage charge over all the immovable

and movable properties (including charge to be created on properties at Uttarakhand of Company’s Tyre Unit) both present and future of all the Units of the Company ranking pari passu with the existing charges save and except assets exclusively charged to other for specifi c loans.

2,14,28,91,200 2,86,57,90,400

Interest accrued and due - 10,37,246- ICICI Bank Limited First pari passu charge on both present and future movable

fi xed assets of Cement expansion project at Vasavadatta Cement Unit by way of hypothecation and fi rst pari passu charge of mortgage over both present and future immovable fi xed assets of Vasavadatta Cement Unit of the Company

2,85,51,25,000 2,85,51,25,000

- State Bank of India Hypothecation/mortgage over all the movable/immovable assets (including mortgage on all immovable assets of all the Units of the Company and hypothecation of movable assets of the Company’s Spun Pipes & Foundries Unit to be created ) both present and future of all the Units of the Company ranking pari passu with the existing charges save and except assets exclusively charged to others for specifi c loans.

1,99,97,93,371 2,00,00,00,000

Interest accrued and due 1,78,33,774 36,46,575- State Bank of India Hypothecation over all movable properties and fi rst pari

passu charge on immovable properties, both present and future, of all the Units of the Company.

- 63,06,39,598

Interest accrued and due - 1,03,14,398

Carried over 8,01,56,43,345 9,36,65,53,217

52

SCHEDULE 3 (Contd.)SECURED LOANS


31st March, 2009Rs.

Brought forward 8,01,56,43,345 9,36,65,53,217 - State Bank of India Hypothecation/mortgage over all the movable/immovable

assets (including mortgage on all immovable assets of all the Units of the Company to be created ) both present and future of all the Units of the Company ranking pari passu with the existing charges save and except assets exclusively charged to others for specifi c loans.

1,09,84,87,513 1,35,00,00,000

Interest accrued and due 1,00,27,876 1,28,98,973- State Bank of India First mortgage / charge to be created on all the fi xed assets

both present and future of the Company on pari passu basis with all the term lenders of the Company.

1,00,00,00,000 -

Interest accrued and due 2,12,329 -- State Bank of Hyderabad Hypothecation over all movable properties and fi rst pari

passu charge on immovable properties, both present and future, of all the Units of the Company.

- 24,40,00,000

- State Bank of Bikaner & Jaipur

Hypothecation over all movable properties and fi rst pari passu charge on immovable properties, both present and future, of all the Units of the Company.

- 8,16,00,000

- State Bank of Indore Hypothecation over all movable properties and fi rst pari passu charge on immovable properties, both present and future, of all the Units of the Company.

- 16,28,00,000

- State Bank of Mysore Hypothecation over all movable properties and fi rst pari passu charge on immovable properties, both present and future, of all the Units of the Company.

- 6,10,80,000

- Standard Chartered Bank First pari passu charge by way of hypothecation over all movable assets,both present and future of the Company and fi rst pari passu charge by way of mortgage over all immovable properties (including charge to be created on assets at Uttarakhand of Company’s Tyre Unit) both present and future, of all the Units of the Company.

92,98,00,000 92,98,00,000

- Standard Chartered Bank First pari passu charge by way of hypothecation/mortgage over all movable/immovable properties (including charge to be created on immovable properties at Uttarakhand of Company’s Tyre Unit) both present and future, of all the Units of the Company.

67,11,56,517 48,30,51,041

- State Bank of India First pari passu charge to be created with other lenders on existing and future fi xed assets of the Company including equitable mortgage on land and building.

1,22,49,02,193 -

- HSBC Bank Ltd. First pari passu charge to be created over the fi xed assets of the tyre division at Uttarakhand.

45,11,57,547

- YES Bank Ltd. First pari passu charge to be created over the fi xed assets of the tyre division at Uttarakhand.

28,06,25,000

- DBS Bank Ltd. Pari passu fi rst mortagage to be created on all immovable assets and pari passu fi rst hypothecation to be created on all movable fi xed assets of the company.

96,32,00,000 -

Carried over 14,64,52,12,320 12,69,17,83,231


53

SCHEDULE 4UNSECURED LOANS

31st March, 2010 31st March, 2009 Rs. Rs.

Fixed Deposits 4,92,24,000 1,90,07,000Security deposits from Selling Agents and others 2,14,70,74,652 1,71,48,68,536

Interest accrued and due 7,60,46,805 5,67,27,963Short Term Loans

- from banks (Note 19.1 on Schedule 17) 4,03,19,47,144 1,23,54,89,858 Interest accrued and due 94,07,192 - - Temporary bank overdraft 37,32,453 3,00,77,238 - Others (Note 19.1 on Schedule 17) 3,85,00,00,000 -

Other loans - from Banks (Note 19.2 on Schedule 17) 4,60,00,00,000 # 1,00,00,00,000 * Interest accrued and due 46,03,605 3,30,137 - Others - 2,00,00,00,000 *

14,77,20,35,851 6,05,65,00,732

# Includes Rs.1,00,00,00,000 repayable within one year from the Balance Sheet date.

* Repayable within one year from the Balance Sheet date if put/ call option is exercised by the Company/ lender in keeping with the terms of related agreements.

SCHEDULE 3 (Contd.)SECURED LOANS


31st March, 2009Rs.

Brought forward 14,64,52,12,320 12,69,17,83,231- IndusInd Bank Ltd. pari passu fi rst charge to be created on the

fi xed assets of the company.1,00,00,00,000 -

Interest accrued and due 1,78,082 -III. From Scheduled Banks

- Foreign Currency Non Repatriable Loan - 1,03,29,25,000- Working Capital Demand Loan Hypothecation of current assets and second

charge on movable and immovable fixed assets, both present and future of the Company.

1,40,00,00,000 50,00,00,000

Interest accrued and due 10,45,479 17,21,841- Overdraft/ Cash Credit 29,86,44,216 20,48,93,588 Interest accrued and due - 19,565- Packing Credit Loan 1,29,20,72,703 93,13,46,569

18,63,71,52,800 15,36,26,89,794

54

SCHE

DULE

5FI

XED

ASSE

TSGR

OSS

BLOC

K

DEPR

ECIAT

ION

NET B

LOCK

At C

ost/ V

aluati

on

as at

31

st Ma

rch, 2

009

Addit

ions/

Adjus

tmen

ts

Delet

ions/

Adjus

tmen

tsCo

st/ Va

luatio

n as

at 31

st Ma

rch,

2010

[Note

1(b)

(i) an

d 1 (b

) (ii)

on

Sche

dule

17]

As at

31

st Ma

rch,

2009

For th

e yea

rOn

De

letion

s/ Ad

justm

ents

durin

g the

ye

ar

As at

31

st Ma

rch,

2010

As at

31

st Ma

rch,

2010

As at

31

st Ma

rch,

2009

Rs.

Rs.

Rs.

Rs.

Rs.

Rs.

Rs.

Rs.

Rs.

Rs.

Free

hold

Land

68

,89,80

,534

64,81

,04,97

4 (d)

- 1,3

3,70,8

5,508

- -

- -

1,33,7

0,85,5

0868

,89,80

,534

Leas

ehold

Land

59

,69,89

4 -

- 59

,69,89

458

,82,06

17,7

52 -

58,89

,813

80,08

187

,833

Build

ings

3,2

8,16,9

1,314

2,59,1

8,97,7

19 (e

) -

5,87,3

5,89,0

33(e)

38,61

,18,84

210

,43,85

,394

- 49

,05,04

,236

5,38,3

0,84,7

972,8

9,55,7

2,472

Railw

ay S

iding

8,6

2,61,1

222,0

3,37,6

21 -

10,65

,98,74

34,3

6,77,8

3829

,07,73

1 -

4,65,8

5,569

6,00,1

3,174

4,25,8

3,284

Plant

and M

achin

ery

22,73

,66,55

,327

14,60

,35,72

,612

4,40,0

5,442

37,29

,62,22

,497

8,53,7

2,24,2

381,5

7,78,1

1,746

3,83,2

7,533

10,07

,67,08

,451

27,21

,95,14

,046

14,19

,94,31

,089

Furni

ture,

Fixtur

e and

Of

fi ce E

quipm

ents

29,75

,65,67

412

,48,85

,601

26,37

,195

41,98

,14,08

013

,44,74

,363

4,08,8

3,186

18,06

,700

17,35

,50,84

924

,62,63

,231

16,30

,91,31

1

Softw

are A

cquir

ed (i

ntang

ible)

- 1,5

1,84,4

98 -

1,51,8

4,498

- 23

,13,71

7 -

23,13

,717

1,28,7

0,781

-Ve

hicles

etc.

7,78,5

7,071

1,46,3

7,570

61,98

,372

8,62,9

6,269

2,48,1

6,324

70,06

,500

39,77

,127

2,78,4

5,697

5,84,5

0,572

5,30,4

0,747

Lives

tock

6,85,8

942,0

1,500

43,25

08,4

4,144

- -

- -

8,44,1

446,8

5,894

27,17

,56,66

,830

18,01

,88,22

,095 (

a) 5,2

8,84,2

5945

,14,16

,04,66

6 (b)

9,13,2

1,93,6

661,7

3,53,1

6,026

4,41,1

1,360

10,82

,33,98

,332

34,31

,82,06

,334

18,04

,34,73

,164

Prev

ious Y

ear

18,95

,44,39

,391

8,34,8

3,68,1

74 (a

) 12,7

1,40,7

3527

,17,56

,66,83

0 (b)

8,11,2

0,25,8

731,1

3,05,9

5,945

11,04

,28,15

29,1

3,21,9

3,666

18,04

,34,73

,164

Ca

pital

Work

-in-pr

ogres

s (inc

luding

Cap

ital A

dvan

ces -

Uns

ecure

d Con

sidere

d Goo

d) 4,1

2,83,3

2,523

(c)

8,64,8

5,27,2

77(c)

38,44

,65,38

,857

26,69

,20,00

,441

(a)Inc

ludes

:(i)

Net g

ain of

Rs.2

0,06,4

5,636

(31.0

3.09 -

Loss

- Rs.1

4,67,6

9,056

) bein

g adju

stmen

t relat

ing to

forei

gn cu

rrenc

y fl u

ctuati

on.

(ii) R

s.46

,08,

76,2

46 (P

revio

us Y

ear -

Rs.

22,9

0,04

,570

) bei

ng b

orro

wing

cos

t cap

italis

ed d

urin

g th

e ye

ar.

(b) In

cludin

g -(c)

Inc

ludes

:(i)

Rs.52

,497 (

31.03

.2009

- Rs.5

2,497

), Rs.5

4,35,0

51 (3

1.03.2

009 -

Rs.5

4,17,7

96) a

nd R

s.14,3

8,479

(31.03

.2009

- Rs.

14,38

,479)

being

joint

ly ow

ned B

uildin

g, Fu

rnitur

e, Fix

ture &

Offi c

e Equ

ipmen

ts an

d Pla

nt &

Mach

inery

respe

ctive

ly.(ii)

Rs

.7,65

,27,20

9 (31

.03.20

09 - R

s.7,65

,27,20

9) Te

chnic

al Kn

ow-ho

w fee

s amo

rtised

over

a peri

od of

5 ye

ars.

(iii)

Rs.85

,898 (

31.03

.2009

- Rs.8

5,898

) bein

g agg

regate

cost

of lan

d on l

ease

to th

ird pa

rties.

(iv)

Rs.2,

55,59

,657 (

31.03

.2009

- Rs.6

6,15,0

62) b

eing c

ost o

f ass

ets ly

ing w

ith th

ird pa

rties.

(v)

Rs.79

,24,94

,416 b

eing b

ook v

alue o

f reva

lued fi

xed a

ssets

[Note

1(b)(

ii) on

Sch

edule

17] a

s belo

w:

(i)

Rs.6,

65,04

,668 (

31.03

.2009

inter

est -

Rs.26

,19,50

,230)

being

borro

wing

cost

capit

alise

d du

ring t

he ye

ar.

(ii)

Expe

nses

alloc

ated R

s.11,9

5,11,2

65 (3

1.03.0

9 - R

s.51,0

1,35,2

30) [N

ote 17

on

Sche

dule

17]

(iii

) Rs

.1,26

,49,33

,584 (

31.03

.2009

- Rs.1

,57,72

,08,59

1) be

ing C

apita

l Adv

ance

s

(iv)

Net g

ain of

Rs.2

8,47,1

10 (3

1.03.2

009 L

oss -

Rs.1

2,24,2

1,196

) bein

g adju

stmen

t rel

ating

to fo

reign

curre

ncy fl

uctua

tion.

(d)

Includ

es R

s.57,0

0,00,0

00 ac

quire

d on a

malga

matio

n (No

te 2.3

on S

ched

ule 17

)

Rs.

(e)

Includ

es R

s.1,89

,98,72

0 for

whic

h the

relat

ed d

eed

of co

nvey

ance

is y

et to

be

exec

uted.

Free

hold

Land

2,98,0

2,512

Build

ings

11,39

,51,06

8Pla

nt an

d Mac

hinery

64,87

,40,83

679

,24,94

,416


55

SCHEDULE 6INVESTMENTS Number Face Value

of each Share

Rs.

Book Value as at

31st March, 2010Rs.

Book Value as at

31st March, 2009Rs.

Long Term - TradeFULLY PAID SHARES (AT COST)

Gondkhari Coal Mining Ltd. (Note 16 on Schedule 17) 22,728 10 2,27,280 - (22,728 Equity Shares purchased during the year)

Long Term - Other than Trade(1) FULLY PAID SHARES

At Under Cost:Aditya Birla Nuvo Ltd. - Equity Shares 4,19,815 10 2,89,61,285 2,89,61,285 Birla Buildings Ltd.-Equity Shares 10,000 10 75,000 75,000 Century Textiles & Industries Ltd.- Equity Shares 25,46,100 10 12,43,356 12,43,356 Coromandel Stampings & Stones Ltd.- Equity Shares 10,000 10 1 1 ECE Industries Ltd.- Equity Shares 59,000 10 6,69,859 6,69,859 Manjushree Plantations Ltd. - Equity Shares * 1,53,268 10 1,04,16,094 1,04,16,094 Aditya Birla Nuvo Ltd. - Equity Shares 1,94,347 10 1,74,93,994 1,74,93,994 Birla Buildings Ltd. - Ordinary Shares 20,000 10 2,00,000 2,00,000 Calcutta Stock Exchange Association Ltd. - Equity Shares 10,455 1 2,09,10,000 2,09,10,000 Century Enka Ltd. - Equity Shares 13,40,680 10 12,91,29,764 12,91,29,764 Century Textiles & Industries Ltd. - Equity Shares 2,00,000 10 16,80,56,382 16,80,56,382 ECE Industries Ltd. - Equity Shares 4,04,096 10 1,57,20,795 1,57,20,795 Essel Mining & Industries Ltd. - Equity Shares 119 10 24,24,802 24,24,802 Grasim Industries Ltd. - Equity Shares 1,42,220 10 56,90,090 56,90,090 HGI Industries Ltd. - Equity Shares 4,96,100 10 1 1 Hindalco Industries Ltd. - Equity Shares 53,586 1 14,77,946 14,77,946 Jay Shree Tea & Industries Ltd. - Equity Shares 1,94,058 10 1,18,600 1,18,600 Kesoram Insurance Broking Services Ltd. - Equity Shares 1,43,000 10 2,86,000 2,86,000 Kesoram Textile Mills Ltd. - Equity Shares 42,96,986 2 3,80,70,170 1,57,70,170 (20,00,000 Equity Shares purchased during the year) (22,96,986)Mangalam Cement Ltd. - Equity Shares 28,62,000 10 4,65,41,500 4,65,41,500 Mangalam Timber Products Ltd. - Equity Shares 24,45,000 10 3,09,69,500 3,09,69,500 Meghdoot Co-operative Housing Society Ltd.- Shares 10 100 1,000 1,000 Padmavati Investment Ltd. - Equity Shares 7,231 10 58,81,551 58,81,551 Vasavadatta Services Ltd. - Equity Shares 18,800 10 1,88,000 1,88,000 Vidula Chemicals & Manufacturing Industries Ltd. - Equity Shares * 44,750 10 5,93,138 5,93,138

carried over 52,53,46,108 50,28,18,828

56

SCHEDULE 6 (Contd.)INVESTMENTS Number Face Value

of each Share

Rs.

Book Value as at

31st March, 2010Rs.

Book Value as at

31st March, 2009Rs.

Brought forward 52,53,46,108 50,28,18,828(2) FULLY PAID SHARES IN SUBSIDIARY

At CostBulland Buildmart Pvt. Ltd. - Equity Share 10 - 12,60,00,000 [Cancelled on amalgamation with the Company (Note 2 on Schedule 17)]

(2,10,000)

52,53,46,108 62,88,18,828 Less : Provision for diminution in value of investments * 1,10,09,232 1,10,09,232

51,43,36,876 61,78,09,596

Aggregate Book Value of Investment in Shares :Quoted (net of provision) 48,41,43,242 46,18,43,242 Unquoted 3,01,93,634 15,59,66,354

51,43,36,876 61,78,09,596

Aggregate Market Value of Quoted Investment in Shares : 3,44,36,55,672 1,46,23,46,283 (excluding investments in HGI Industries Ltd. Kesoram Textile Mills Ltd., Manjushree Plantations Ltd. and Vidula Chemicals & Manufacturing Industries Ltd. in absence of any current quotation)

Figures in bracket represents for previous year.

INVESTMENTSInvestments purchased and sold during the year Number Face Value of Cost

each Unit. Current Investment – other than trade Rs. Rs. Units in Mutual FundsNFSTD Canara Robeco Floating Rate ST Daily Dividend Fund 4,38,83,426.455 10 45,02,43,955SBI – Magnum Insta Cash Fund – Daily Dividend Option 53,77,342.246 10 9,00,72,096UTI Liquid Cash Plan Institutional – Daily Income Option - Re -investment 60,00,185.037 1,000 6,11,68,62,84232ISD ICICI Prudential Institutional Liquid Plan – Super Institutional Daily Div 2,15,12,904.131 10 21,51,76,3701564 ICICI Prudential Institutional Liquid Plan – Super Institutional Daily Div 52,52,321.042 100 52,53,47,995Birla Sun Life Cash Plus - Insti – Daily Dividend - Reinvestment 1,48,20,496.837 10 16,00,95,453Kotak Flexi Debt Scheme Institutional – Daily Dividend 64,75,668.056 10 6,50,64,275Kotak Liquid (Institutional) - Daily Dividend 1,75,86,392.620 10 21,50,48,168Kotak Floater Long Term – Daily dividend 74,44,537.253 10 7,50,39,447UTI Treasury Advantage Fund – Institutional Plan (Daily Dividend Option) -Re – investment

23,11,213.728 1,000 2,31,17,08,472

DWS Treasury Fund - Cash Institutional Plan – Daily Dividend 79,78,846.619 10 8,00,35,915DWS Insta Cash Plus Fund – Super Institutional Plan Daily Dividend 6,08,49,515.450 10 61,03,44,980HDFC Cash Management Fund – Treasury Advantage Plan – Wholesale - Daily Dividend

1,79,53,710.785 10 18,01,02,650

HDFC Cash Management Fund – Savings Plan – Daily Dividend - Re-investment

1,69,31,108.359 10 18,00,86,041


57

INVESTMENTSInvestments purchased and sold during the year Number Face Value of Cost

each Unit. Current Investment – other than trade Rs. Rs. Units in Mutual Funds32 IPD ICICI Prudential Liquid Plan Institutional Plus - Daily Dividend 42,20,059.933 10 5,00,14,04032IN ICICI Prudential Institutional Liquid Plan – Weekly Dividend Option 25,32,778.373 10 3,00,00,000Axis Treasury Advantage Fund – Daily Dividend 50,035.925 1,000 5,00,35,925Reliance Liquid Fund – Treasury Plan – Retail Option – Growth Option - Growth Plan

2,28,606.961 10 50,00,000

NLFID – Canara Robeco Liquid Fund – Institutional Daily Dividend - Re-investment

34,85,979.117 10 3,50,02,716

NLPIDD – Canara Robeco Treasury Advantage Institutional Daily Dividend Fund

28,29,352.027 10 3,51,04,054

SCHEDULE 7

INVENTORIES[Refer Note 1(d) on Schedule 17] 31st March, 2010 31st March, 2009

Rs. Rs. Stores and Spare Parts 1,41,05,51,015 1,31,70,98,342Raw Materials 3,68,26,04,239 2,24,13,15,921Work-in-Process 1,16,10,35,446 64,81,52,922Finished Goods 2,90,77,50,683 1,68,40,45,785

9,16,19,41,383 5,89,06,12,970

SCHEDULE 8

SUNDRY DEBTORS 31st March, 2010 31st March, 2009

Rs. Rs. Debts over six months

Secured - Considered good 3,85,26,566 1,87,37,401Unsecured

- Considered good 2,64,92,984 3,29,54,603- Considered doubtful 7,79,698 5,28,089

2,72,72,682 3,34,82,692 Less: Provision for doubtful debts 7,79,698 5,28,089

2,64,92,984 3,29,54,603Other Debts - Considered good

Secured 1,63,65,95,772 1,35,75,34,063Unsecured 3,72,72,70,823 2,39,24,79,570

5,36,38,66,595 3,75,00,13,6335,42,88,86,145 3,80,17,05,637

SCHEDULE 6 (Contd.)

58

SCHEDULE 9CASH AND BANK BALANCES


Cash in hand [including Rs.2,30,623 (31.03.2009 - Rs.63,44,073)cheques/ drafts in hand] 36,27,459 83,38,292With Scheduled Banks on -Current Account [including Rs.22,31,20,485 (31.03.2009 - Rs.19,12,56,787)Remittances in transit] 78,11,08,183 54,25,66,016Unpaid Dividend Accounts 1,66,16,447 1,48,12,098Term Deposit Account 31,31,188 28,31,188[(including Rs.21,188 (31.03.2009- Rs.21,188)] pledged with sales tax/ ESI Authorities]With Post Offi ce Savings Bank Account 5,000 5,000[Maximum Amount outstanding at any time during the yearRs. 5,000 (Previous Year Rs. 5,000)]

80,44,88,277 56,85,52,594

SCHEDULE 10OTHER CURRENT ASSETS


Unsecured - Considered GoodDeposits 18,95,72,174 10,84,63,420Accruals under Duty Exemption Scheme pertaining to exports 10,85,54,875 11,23,81,314Accrued Interest on deposits 32,10,913 27,97,132

30,13,37,962 22,36,41,866

SCHEDULE 11LOANS AND ADVANCES


Unsecured - Considered Good

Loan to Subsidiary - 41,50,00,000Other Loans (including accrued interest) 6,94,59,306 8,61,48,926Advances recoverable in cash or in kind or for value to be received 2,27,24,04,041 1,63,00,44,650

Balance with Excise, Port Trust and Customs Authorities etc. 34,21,672 12,18,382

Advance Payment of Income Tax and tax deducted at source [net of Provision for taxation (including tax on Proposed Dividend) Rs.3,39,00,15,340] 8,43,36,825 -MAT Credit Entitlement [Note 13(a) on Schedule 17] 44,50,00,000 -

2,87,46,21,844 2,13,24,11,958


59

SCHEDULE 12CURRENT LIABILITIES AND PROVISIONS

31st March, 2010 31st March, 2009

Rs. Rs. Rs.

CURRENT LIABILITIES

Sundry Creditors

Due to Micro and Small Enterprise * 14,45,289 10,33,407

Others 3,84,21,47,562 2,44,26,08,661

3,84,35,92,851 2,44,36,42,068

Advance from customers 37,00,04,405 16,11,15,481

Unclaimed Dividend 1,66,16,405 1,48,12,056

Other Liabilities 92,48,52,087 85,76,00,000

Interest accrued but not due on loans 13,11,78,802 15,39,56,056

5,28,62,44,550 3,63,11,25,661

* represents principal amount

Note:

There is no amount due and outstanding to be credited to Investors Education and Protection Fund as at Balance Sheet Date other than unclaimed dividend of Rs.56,307 (31.03.2009 - Rs.45,903) pertaining to cases under litigation regarding benefi cial ownership of shares.

PROVISIONS

Taxation including tax on Proposed Dividend [net of Advance Income Tax (including tax deducted at source) 31.03.2009 Rs.3,13,89,68,127]

- 15,98,60,977

Fringe Benefi t Tax [Net of Advance Tax Rs.3,35,05,788 (31.03.2009 - Rs.4,12,53,551)]

12,59,454 53,67,634

Proposed Dividend 14,86,65,784 14,86,65,784

14,99,25,238 31,38,94,395

60

SCHEDULE 13OTHER INCOME

2009-2010 2008-2009

Rs. Rs. Rs.

Income from Long Term Investments (other than trade)

- Dividend 4,74,18,383 4,72,28,746

- Interest - 22,098

4,74,18,383 4,72,50,844

Dividend income from Current Investments (other than trade) 46,55,917 19,43,811

Interest (Gross)

On loans [Tax deducted at source Rs.9,30,662 83,30,946 74,78,558

(2008-2009 - Rs.11,34,181)]

On bank and other deposits [Tax deducted at source Rs.2,65,933 (2008-2009 - Rs.1,15,691)]

24,34,616 15,93,105

On advance tax - 4,10,26,910

On delayed payment by customers 4,95,20,284 2,99,04,760

On delayed credit by bank - 1,88,879

6,02,85,846 8,01,92,212

Insurance Claims 1,38,72,213 1,79,36,425

Accruals under duty exemption scheme pertaining to exports 30,87,77,655 24,05,67,739

Foreign Currency Translation Gain (Net) 31,15,13,362 -

Liabilities no longer required written back 2,07,22,174 4,64,64,863

Profi t on Fixed Assets sold/ discarded (Net) - 3,35,17,858

Profi t on Long Term Investments (other than trade) sold - 36,14,099

Profi t on Current Investments (other than trade) sold 42,250 76,319

Miscellaneous Income (Note 20 on Schedule 17) 48,33,79,922 28,78,34,676

1,25,06,67,722 75,93,98,846


61

SCHEDULE 14RAW MATERIALS AND FINISHED GOODS

2009-2010 2008-2009 Rs. Rs. Rs.

(i) Raw Materials ConsumedOpening Stock 2,24,13,15,921 2,21,03,73,329Purchases (a) 24,24,11,97,040 16,10,08,47,131

26,48,25,12,961 18,31,12,20,460Less : Closing Stock 3,68,26,04,239 2,24,13,15,921

22,79,99,08,722 16,06,99,04,539Raising cost of limestone (b) 92,20,27,338 74,34,58,869

(ii) (Increase)/Decrease in Work In Process, Finished GoodsOpening Stock

Work - in - Process 64,81,52,922 51,79,69,097Finished Goods 1,68,40,45,785 95,67,26,145

2,33,21,98,707 1,47,46,95,242Purchases (c) 33,10,69,513 60,13,73,325

2,66,32,68,220 2,07,60,68,567Less: Work-in-Process transferred to trial run 87,10,670 - Add: Processed (11,876 MT)/ Semi-processed items transferred from trial run [Note 17 on Schedule 17] 5,11,99,799 3,08,21,279

2,70,57,57,349 2,10,68,89,846Less: Closing Stock

Work - in - Process 1,16,10,35,446 64,81,52,922 Finished Goods 2,90,77,50,683 1,68,40,45,785

(1,36,30,28,780) (22,53,08,861)Less : Transferred to Capital Jobs 3,65,59,796 5,28,83,509

(1,39,95,88,576) (27,81,92,370)22,32,23,47,484 16,53,51,71,038

(a) Purchase of Raw Materials is net of sale value - 6,95,52,346(b) Limestone Raising Cost include:

Salaries, Wages, Bonus etc. 5,02,63,958 4,73,86,522Contribution to Provident and other Funds 40,89,827 38,47,957Workmen and Staff welfare 42,16,356 42,56,480Dead Rent, Royalty etc. 41,16,04,532 26,88,63,174Power and Fuel 6,99,040 12,68,872Stores Consumed 25,68,61,134 26,88,15,610Machinery repairs 14,89,55,877 12,18,13,066Other repairs 12,31,243 5,88,674Rates and taxes 2,07,212 1,20,627Insurance 7,49,124 3,71,532

62

SCHEDULE 14 (Contd.)RAW MATERIALS AND FINISHED GOODS

2009-2010 2008-2009 Rs. Rs.

Quantity2009-2010 2008-2009

(c) Purchase of fi nished goods comprise:Tyres, tubes & fl aps (set) Nos. 1,363 550 1,51,09,813 74,31,195Tubes Nos. 2,43,239 3,79,251 18,41,00,910 40,27,78,598Flaps Nos. 6,36,940 8,44,817 13,18,58,790 19,09,03,743Market Fittings Pcs. - 4,121 - 2,59,789

33,10,69,513 60,13,73,325

SCHEDULE 15MANUFACTURING, SELLING AND ADMINISTRATIVE EXPENSES

2009-2010 2008-2009 Rs. Rs.

Salaries, Wages, Bonus etc. 1,94,58,01,308 1,50,53,55,295 Contribution to Provident Fund 16,53,02,151 13,02,56,510 Contribution to Superannuation Fund 55,91,004 44,20,321 Contribution to Gratuity Fund 2,07,91,375 6,90,67,078 Contribution under Employees’ State Insurance Scheme 1,32,06,277 1,25,08,546 Workmen and Staff Welfare 10,21,77,664 8,05,38,069 Power and Fuel 6,24,22,83,052 5,55,90,83,241 Stores and Spare Parts consumed [less sale value Rs.4,49,88,342(2008-2009 - Rs.2,28,70,199)] 1,01,02,95,519 85,33,87,851 Repairs and Maintenance Building 8,05,03,564 6,08,04,053 Plant and Machinery 45,71,18,122 36,17,80,083 Others 4,33,43,666 3,91,62,967 Rent [Net of realisation Rs.1,14,94,243 (2008-2009 - Rs.98,20,697)] 3,09,60,514 2,12,73,153 Rates and Taxes 37,76,74,881 30,23,57,075 Insurance 7,05,29,037 5,19,46,423 Brokerage and Discounts 1,55,72,92,220 97,85,74,137 Packing, Carriage and Shipping 4,32,36,88,687 4,14,30,15,641 Commission to Selling Agents 61,80,82,818 42,40,27,119 Directors’ Fees 11,20,000 7,25,000 Directors’ Commission 24,00,000 20,00,000

Carried over 17,06,81,61,859 14,60,02,82,562


63

SCHEDULE 15MANUFACTURING, SELLING AND ADMINISTRATIVE EXPENSES

2009-2010 2008-2009 Rs. Rs.

Brought Forward 17,06,81,61,859 14,60,02,82,562Long Term Investments (other than trade) written off - 13,000 Debts/ Advances/ Deposits written off - 7,22,15,354 Loss on Fixed Assets sold/ discarded (Net) 26,23,824 - Provision for Doubtful Debts 2,51,609 5,28,089 Foreign Currency Translation Loss (Net) - 45,74,30,209 Miscellaneous Expenses 1,59,05,69,491 1,45,25,52,956

18,66,16,06,783 16,58,30,22,170

SCHEDULE 16INTEREST

2009-2010 2008-2009 Rs. Rs. Rs.

Interest :On Debentures 30,62,59,928 18,82,99,132 On Fixed Loans 1,03,63,12,396 1,12,70,98,874 Others 22,44,46,952 22,31,99,158

1,56,70,19,276 1,53,85,97,164 Less: Interest Capitalised 47,67,06,650 32,98,75,355

1,09,03,12,626 1,20,87,21,809 1,09,03,12,626 1,20,87,21,809

64

SCHEDULE 17NOTES ON ACCOUNTS FOR THE YEAR ENDED 31ST MARCH, 20101 SIGNIFICANT ACCOUNTING POLICIES (a) Basis of Preparation of Financial Statements These Financial Statements have been prepared under the historical cost convention [other than for revaluation of certain

fi xed assets as detailed in ‘1(b)(ii)’ and ‘1(b)(iv)’ below] and in compliance with all the applicable accounting principles in India, the applicable accounting standards notifi ed under section 211(3C) of the Companies Act , 1956 (the ‘Act’) and the relevant provisions of the Act. A summary of signifi cant accounting policies which have been applied is set out below.

(b) Fixed Assets and Depreciation (i) Fixed Assets are stated at cost of construction/ acquisition [except for items mentioned in (b) (ii) below] inclusive of

inward freight, non refundable duties/ taxes, incidental expenses directly related to acquisition and borrowing cost where applicable and adjustments for exchange difference referred to in Note 1(f) below. In respect of projects involving construction, related pre operational expenses form part of the value of assets capitalised. An impairment loss is recognised wherever the carrying amount of fi xed assets of a cash generating unit exceeds its recoverable amount (i.e. higher of net selling price and value in use).

(ii) Land, buildings and certain plant and machineries of Rayon and Transparent Paper Unit as at 31st March, 1982 and of Cement (at Basantnagar) and Spun Pipes & Foundries Units as at 31st March, 1983 are stated at valuation made by the professional valuers in 1982-83 at the then current value.

(iii) Capital work in progress is stated at cost [including borrowing cost, where applicable and adjustment for exchange difference referred to in Note 1(f) below], incurred during construction/ installation/ pre-operative period relating to items or projects in progress.

(iv) Depreciation on revalued items of fi xed assets referred to in (b)(ii) above is calculated on their respective revalued amounts at rates considered applicable by the valuers on straight line method as against the methods/ rates/ bases which would have otherwise been adopted for the purpose of the annual accounts of the Company and accordingly includes additional depreciation charge. An amount equivalent to the aforesaid additional depreciation charge is transferred to the credit of the Profi t and Loss Account from Capital Reserve - Revaluation of Fixed Assets.

(v) Depreciation on fi xed assets acquired up to 31st March, 1983 and not covered by revaluations referred to in (b)(ii) above pertaining to Transparent Paper Division of Rayon & Transparent Paper Unit and fi xed assets of Bharat General Unit (except those pertaining to Malkapur Extraction Division) is calculated under reducing balance method at applicable rates as per Schedule XIV to the Companies Act, 1956 as revised during 1993-94.

(vi) Leasehold land is amortised over the lease period. (vii) Software are capitalised where it is expected to provide future enduring economic benefi ts and amortised on a straight

line basis over a period of three years from the date of capitalisation. Capitalisation costs include license fees and the cost of implementation/ system integration services. The Costs are capitalised in the year in which the relevant software is implemented for use.

(viii) Depreciation on fi xed assets acquired up to 31st March, 1993 other than items covered in (b)(iv) to (b)(vi) above is calculated under straight line method at the rates considered adequate to amortise the depreciable book value over the remaining part (as at 1st April, 1993) of the specifi ed period recomputed by applying the Schedule XIV rates as revised during 1993-94 in keeping with the Circular No.14/93 dated 20th December, 1993 of the Department of Company Affairs, Government of India.

(ix) Depreciation on additions to fi xed assets from 1st April, 1993 [except for deferral of annual depreciation charge for three years from 1999-2000 to 2001-2002 on certain fi xed assets of Cement Units as indicated in (b)(x) below and items covered in b(vii) above], fi xed assets of Hindusthan Heavy Chemicals Unit, and those pertaining to Malkapur Extraction Divisions of Bharat General Unit [referred to in (b)(v) above], is calculated under straight line method at applicable rates as per Schedule XIV to the Companies Act, 1956 as amended during 1993-94.

(x) Pursuant to Central Government’s approval under Section 205(2)(c) of the Act, depreciation not provided in 1999-2000, 2000-2001 and 2001-2002 accounts on certain fi xed asset items of Cement Units are amortised over the remaining part of specifi ed period (as at 1st April, 2000, 1st April, 2001 and 1st April, 2002 respectively) based on the prescribed rates.


65

SCHEDULE 17 (Contd.) (c) Investments Long Term Investments are stated at cost where applicable; provision for diminution is made or carrying amount is written

down to recognise a decline other than temporary in the carrying amount of long term investments as determined by the Board of Directors on periodical review. Current investments are carried at lower of cost and fair value. Gains/ losses on disposal of the investments are recognised as income/ expenditure.

(d) Inventories Inventories are stated at lower of cost and net realisable value. Cost is determined on weighted average/ FIFO basis, as

considered appropriate by the Company and includes expenditure incurred in the normal course of business in bringing inventories to its location and condition, appropriate overheads, where applicable. Provision is made for obsolete/slow moving/defective stocks, wherever necessary.

(e) Borrowing Cost Borrowing costs attributable to qualifying assets (assets which require substantial period of time to get ready for their intended

use) are capitalised as part of the cost of such assets. All other borrowing costs are charged to revenue. (f) Foreign Currency Translation as applicable under accounting standard 11 on ‘The effects of Changes in Foreign

Exchange Rates’. Transactions in foreign currency are accounted for at the exchange rates prevailing on the date of transactions. Monetary

assets and liabilities related to foreign currency transactions remaining unsettled at the end of the year are translated at year end exchange rates. Gains/losses (other than relating to reporting of Long term foreign currency monetory items) arising out of fl uctuations in the exchange rates are recognised in Profi t and Loss Account in the period in which they arise. Exchange differences arising on reporting of Long term foreign currency monetory items (i) relating to acquisition of depreciable capital assets is adjusted to the carrying amount of such assets (to be depreciated over the balance life of the related asset) and (ii) in other cases accumulate in a ‘Foreign Currency Monetory Item Translation Difference Account’ (to be amortised over the balance period of the related long term monetory asset/liability but not beyond 31st March, 2011). Differences between the forward exchange rates and the exchange rates at the date of transactions are accounted for as income/expense over the life of the contracts.

(g) Derivative Contracts In respect of derivative contracts (other than forward exchange contracts covered under Accounting Standard 11 on ‘The

Effects of Changes in Foreign Exchange Rates’), gains/losses on settlement and mark to market loss (net) relating to outstanding contracts as at the Balance Sheet date is recognised in the Profi t and Loss Account.

Refer Note 1(f) above for forward exchange contracts covered under Accounting Standard 11 on ‘The Effects of Changes in foreign Exchange Rates’.

(h) Sales Sales represent value of goods sold and are net of trade discounts/ allowances, sales return and excluding sales tax/ value

added tax. (i) Investment Income Income from investments is accounted for on accrual basis, inclusive of related tax deducted at source. (j) Employee Benefi ts Short-term Employee Benefi ts (i.e. benefi ts payable within one year ) are recognised in the period in which employee services

are rendered. Contributions towards superannuation at rates specifi ed in related approved scheme covering eligible employees are

recognised as expense and funded. Contributions towards provident funds are recognised as expense. Provident fund contributions in respect of certain

employees are made to Trusts administered by the Company; the interest rate payable to the members of the Trusts is not lower than the statutory rate of interest declared annually by the Central Government under the Employees’ Provident Funds and Miscellaneous Provisions Act, 1952 and shortfall, if any, is to be made good by the Company. The remaining provident fund contributions are made to employer established provident funds (for other than covered employees) / government administered provident fund towards which the Company has no further obligations beyond its monthly contributions. (Also refer Note 15A below).

66

SCHEDULE 17 (Contd.) Liability towards gratuity, covering eligible employees, is provided and funded on the basis of year-end actuarial valuation. Accrued liability towards leave encashment benefi ts, covering eligible employees, evaluated on the basis of year-end actuarial

valuation is recognised as a charge. Contribution to Central Government administered Employees’ State Insurance Scheme for eligible employees is recognised

as charge. Actuarial gains/losses arising in Defi ned Benefi t Plans are recognised immediately in the Profi t and Loss Account as income/

expense for the year in which they occur. (k) Taxes on Income Current tax is determined as the amount of tax payable in respect of taxable income for the year. Deferred tax is provided/

recognised on timing differences between taxable income and accounting income using the liability method subject to consideration of prudence. Deferred tax assets on unabsorbed depreciation and carry forward of losses under tax laws are not recognised unless there is virtual certainty that there will be suffi cient future taxable income available to realise such assets.

(l) Government Grants Grants of Capital nature and related to specifi c Fixed Assets are deducted from gross value of assets. Other grants of

Capital nature are credited to Capital Reserve. Grant related to revenue are recognised in the Profi t and Loss Account on a systematic basis to match them with related costs.

2 Amalgamation of Bulland Buildmart Private Limited, a wholly owned subsidiary Company (Transferor Company) with Kesoram Industries Limited (Transferee Company)

2.1 Pursuant to a scheme of Amalgamation (the ‘Scheme’) sanctioned by the High Court at Calcutta in July 2009 under the provisions of the Companies Act,1956, the Transferor Company has been amalgamated with Transferee Company in these accounts with retrospective effect from 1st October, 2008 (Appointed Date). The Scheme has been accounted for using the ‘Purchase Method’ set out in Accounting Standard 14 on ‘Accounting for Amalgamation’.

2.2 The Transferor Company was primarily engaged in the business of purchasing land for sale/ development and civil & constructional work relating to building, roads, bridges etc.

2.3 In accordance with the scheme, all assets and liabilities of the Transferor Company immediately preceding the Appointed Date have been incorporated in the books of account of Transferee Company at their respective book values on the basis of audited accounts of the Tranferor Company. The net assets as per the books of account of the Transferor Company after cancellation of investment of the Transferee Company in Tranferor Company as on 30th September, 2008 has been credited to Capital Reserve of the Transferee Company in 2009-10 and the results of the Tranferor Company for the period 1st October, 2008 to 31st March, 2009 has been adjusted with the opening credit balance in Profi t and Loss Account of Transferee Company.

3 (a) Expansion activities taken up in 2006-07 relating to fourth production line at Company’s Vasavadatta Cement Unit for 1.65 million tons capacity increase of cement has commenced commercial production on 7th August, 2009. The related clinker plant commenced commercial production on 1st June, 2009.

(b) Radial truck tyre (140 MT/day) and motor cycle tyre (95 MT/day) projects taken in 2008-09 at Uttarakhand commenced commercial production in March, 2010 and in phases from October, 2009 to March, 2010 respectively. Further expansion in bias tyre at Uttarakhand by 60 MT/day taken up in 2008-09 has been completed during the year.

(c) Radial car tyre project with 80 MT/day capacity at Balasore and further expansion of radial truck tyre by 85 MT/day at Uttarakhand taken up during the year are expected to commence commercial production by the end 2010-2011.

4 The Company intends to hive off its Hindusthan Heavy Chemicals unit (the Unit) as refl ected in the Board Resolution of 31st January, 2006 and later on consented by the shareholders by postal ballot of 24th March, 2006. The Unit is not signifi cant in terms of the Company’s total assets/ liabilities/ revenue/ expenses/ cashfl ows. Pending disposal of the Unit, the Unit is in operation and results thereof, have been refl ected in these Accounts.

The Company’s Spun Pipes and Foundries Unit is under suspension of work effective 2nd May,2008.


67

SCHEDULE 17 (Contd.)

31st March, 2010 31st March, 2009

Rs. Rs.

5A Contingent Liabilities :

(a) Guarantees given -

(i) to excise authorities 11,73,223 11,73,223

(ii) by Banks on behalf of the Company (excluding relating to joint venture referred to in Note 16 below)

70,38,54,755 45,96,01,210

(b) Claims against the Company not acknowledged as debts :

Rates, Taxes, Duties etc. demanded by various Authorities 1,20,94,00,083 1,20,64,70,509

Amount demanded by Provident Fund and Employees’ State InsuranceAuthorities which is subjudice

86,86,000 1,24,00,913

1,21,80,86,083 1,21,88,71,422

(c) Rates, Taxes, Duties etc. 8,14,89,255 8,91,12,673

(d) Amount payable in connection with reorganisation of the Company in earlier year

3,71,22,132 3,79,65,159

5B Capital Commitments [net of advances Rs.1,24,06,57,500 (31.03.09 - Rs.1,57,72,08,591)]

4,35,92,60,490 2,33,99,29,572

6 The major components of the deferred tax assets and liabilities accounted forduring the year in the manner indicated in Note 1(k) above are as below:

Tax effect of timing differences

(a) Deferred Tax Liabilities

Difference between written down value of block of assets as per Income tax laws and book written down value of the fi xed assets

3,33,55,01,551 1,31,26,88,000

(b) Deferred Tax Assets

(i) Items allowable for tax purpose on payment 5,09,85,000 5,09,85,000

(ii) Others 1,33,687 2,27,665

Net Deferred Tax Liability as at the year-end 3,28,43,82,864 1,26,14,75,335

Amount charged/(credited) to Profi t and Loss Account 2,02,29,07,529 (16,62,66,850)

68

SCHEDULE 17 (Contd.)31st March, 2010 31st March, 2009

Rs. Rs.7 (a) Computation of Net Profit under Section 349/ 198(1) of

the Companies Act, 1956 for the purpose of Directors’ commissionProfi t before Taxation per Profi t and Loss Account 4,75,49,43,448 4,09,11,43,051

Add : Depreciation as per accounts 1,72,80,03,438 1,11,85,61,067 Managerial Remuneration 1,35,53,022 90,09,959 Long Term Investments (other than trade) written off - 13,000 Provision for doubtful debts 2,51,609 5,28,089

1,74,18,08,069 1,12,81,12,1156,49,67,51,517 5,21,92,55,166

Less : Profi t on Long Term Investments (other than trade) sold - 36,14,099 Profi t on Current Investments (other than trade) sold 42,250 76,319 Depreciation under Section 350 of the Companies Act, 1956 1,68,81,23,640 1,07,84,34,264 Capital profi t on sale of fi xed assets 14,557 2,39,63,836

1,68,81,80,447 1,10,60,88,518Net Profi t 4,80,85,71,070 4,11,31,66,6481% of Net Profi t 4,80,85,711 4,11,31,666Commission payable to non whole-time Directors 24,00,000 20,00,000

(b) Managerial Remuneration(i) Directors’ Fees 11,20,000 7,25,000(ii) Commission to non whole-time Directors 24,00,000 20,00,000(iii) Remuneration paid/ payable to Director/Manager Salaries, Bonus etc. 61,78,509 38,64,911 Contribution to Provident Fund 4,89,600 3,08,244 Contribution to Superannuation Fund 6,12,000 3,85,304 Contribution to Gratuity Fund 19,51,627 10,98,528 Other benefi ts/ perquisites 8,01,286 6,27,972

1,00,33,022 62,84,9591,35,53,022 90,09,959

(c) Shareholders’ approval is yet to be obtained for remuneration of Rs. 27,59,365 [included in Note 7(b) above] of a Director in whole-time employment.


69

SCHEDULE 17 (Contd.)2009-2010 2008-2009

Rs. Rs.

8 Power and Fuel (Schedule 15) includes consumption of stores and spares 5,63,17,94,704 4,95,11,40,034

9 Repairs and Maintenance (Schedule 15) includes:

(a) Consumption of stores and spare parts 12,32,03,016 13,94,25,323

(b) Salaries and Wages 19,45,04,098 14,64,68,536

(c) Technical Service fees 14,87,843 5,77,872

10 Packing, carriage and shipping (Schedule 15) includes:

(a) Consumption of stores and spare parts 55,82,41,468 59,62,25,681

(b) Salaries and Wages 7,41,67,815 6,48,21,711

11 Fixed Assets/ Capital Work-in-Progress (Schedule 5) include

consumption of stores and spare parts during the year 1,12,87,43,339 1,79,98,63,402

12 Miscellaneous expenses (Schedule 15) includes:

(a) Guarantee Commission 35,90,799 16,14,257

(b) Technical Service Charges 33,05,885 35,09,300

(c) Conversion Charges 32,97,62,164 34,55,79,589

(d) Consumption of stores and spare parts 3,23,41,084 2,22,06,581

(e) Auditors’ Remuneration:

As Auditors -

Audit Fees 75,00,000 62,00,000

Tax Audit Fees [including Rs.Nil (2008-09 - Rs.3,50,000) for previous year] 27,50,000 28,50,000

Fees for issuing various certifi cates (including Limited Review) 39,29,800 32,63,000

Reimbursement of Expenses 2,96,692 2,57,931

(f) Payment to Cost Auditors (Fees) 4,57,000 4,15,000

13 (a) Provision for Current Tax for the current year 2009-2010 is net of MAT credit of Rs.44,50,00,000 (2008-2009 - Rs.Nil) as the Company is confi dent to generate suffi cient taxable income in the next few years available for set off of the aforesaid credit within the stipulated time.

(b) Provision for Current Tax for the year 2009-2010 is net of write back of Rs.Nil (2008-2009 - Rs.40,92,26,444) in respect of earlier years.

14 Miscellaneous expenses (Schedule 15) include Rs.10,91,48,160 [2008-09 - net of Rs.3,80,73,336] excise duty related to the difference between the closing stock and opening stock

70

SCHEDULE 17 (Contd.)15 A . In keeping with the Guidance on implementing Accounting Standard (AS) 15 on Employee Benefi ts issued by the Accounting

Standards Board of the Institute of Chartered Accountants of India (ASB Guidance), employer-established provident fund trusts are treated as Defi ned Benefi t Plans since the Company is obligated to meet interest shortfall, if any, with respect to covered employees. According to the management, in consultation with Actuary, actuarial valuation cannot be applied to reliably measure provident fund liabilities in absence of guidance from Actuarial Society of India. Accordingly, the Company is currently not in a position to provide other related disclosures as required by the aforesaid AS 15 read with the ASB Guidance, however, having regard to the position of the Fund (for covered employees) and confi rmation from the Trustees’ of such Fund there is no shortfall as at the year end.

B. In keeping with the Company’s gratuity scheme (a defi ned benefi t plan), eligible employees are entitled to gratuity benefi t (at one half month’s eligible salary for each completed year of service) on retirement / death / incapacitation / termination. Also refer Note 1 (i) for accounting policy relating to gratuity. Following are the further particulars with respect to gratuity :-

2009-2010 2008-2009 2007-2008Rs. Rs. Rs.

I. Reconciliation of opening and closing balances of the present value of the Defi ned Benefi t Obligation(a) Present Value of Obligation at the beginning of the year 50,12,81,917 47,00,50,924 40,47,57,613(b) Current Service Cost 3,84,04,200 3,30,26,132 2,96,67,743 (c) Interest Cost 3,57,20,645 3,37,82,502 3,11,97,324 (d) Actuarial Loss 4,74,32,668 36,57,471 3,40,10,380 (e) (Benefi ts Paid) (5,00,13,298) (3,92,35,112) (2,95,82,136)(f) Present Value of Obligation at the end of the year 57,28,26,132 50,12,81,917 47,00,50,924

II. Reconciliation of opening and closing balances of the fair value of Plan Assets(a) Fair Value of Plan Assets at the beginning of the year 43,64,24,839 42,82,25,808 35,68,97,684 (b) Expected Return on Plan Assets 3,05,49,738 2,99,75,806 2,85,51,815 (c) Actuarial Gain/(Loss) 7,02,16,400 (2,85,76,779) 11,25,361 (d) Contributions by employer 6,48,57,078 4,60,35,116 7,12,33,084 (e) (Benefi ts Paid) (5,00,13,298) (3,92,35,112) (2,95,82,136)(f) Fair Value of Plan Assets as at the end of the year 55,20,34,757 43,64,24,839 42,82,25,808

III. Reconciliation of the present value of Defi ned Benefi t Obligation in ‘I’ above and the fair value of Plan Assets in ‘II’ above(a) Present Value of Obligation as at the end of the year 57,28,26,132 50,12,81,917 47,00,50,924 (b) Fair Value of Plan Assets as at the end of the year 55,20,34,757 43,64,24,839 42,82,25,808 (c) Liability recognised in the Balance Sheet 2,07,91,375 6,48,57,078 4,18,25,116

IV. Expense charged to the Profi t and Loss Account(a) Current Service Cost 3,84,04,200 3,30,26,132 2,96,67,743 (b) Interest Cost 3,57,20,645 3,37,82,502 3,11,97,324 (c) (Expected Return on Plan Assets) (3,05,49,738) (2,99,75,806) (2,85,51,815)(d) Actuarial (Gain)/Loss (2,27,83,732) 3,22,34,250 3,28,85,019 (e) Total expense charged to the Profi t and Loss Account* 2,07,91,375 6,90,67,078 6,51,98,271 * refl ected as ‘Contribution to Gratuity Fund’ under ‘MANUFACTURING, SELLING AND ADMINISTRATIVE EXPENSES’ on Schedule 15 of respective year’s accounts


71

SCHEDULE 17 (Contd.)V. Percentage of each Category of Plan Assets to total

Fair Value of Plan Assets31st March, 2010

Rs.31st March, 2009

Rs.31st March, 2008

Rs.(a) NAV / Interest based schemes with Insurance

Companies67.84% 58.19% 56.51%

(b) Special Deposit Scheme with State Bank of India 24.01% 30.31% 31.19%(c) Government (Central and State) Securities 2.06% 3.89% 5.41%(d) Others (including bank balances) 6.09% 7.61% 6.89%

2009-2010 2008-2009 2007-2008Rs. Rs. Rs.

VI. Actual Return on Plan Assets 10,07,66,138 13,99,027 2,96,77,176

VII. Principal Actuarial Assumptions 31st March, 2010 31st March, 2009 31st March, 2008Rs. Rs. Rs.

(a) Discount Rate (per annum) 7.50% 7.50% 8.00%(b) Expected Rate of Return on Plan Assets (per annum) 7.00% 7.00% 8.00%(c) Salary Escalation 5.00% 5.00% 6.00%(d) Infl ation Rate 5.00% 5.00% 6.00%

The estimates of future salary increases, considered in actuarial valuation, take account of infl ation, seniority, promotion and other relevant factors, such as supply and demand in the employment market. The expected rate of return on plan assets is based on the portfolio of assets held, investment strategy and market scenario. In order to protect the capital and optimise returns within acceptable risk parameters, the plan assets are reasonably diversifi ed.

16 The Company’s interest as a venturer in jointly controlled entity (incorporated joint venture during the year) is:-Name Country of Incorporation Proportion of ownership

interest as on 31st March, 2010Proportion of ownership

interest as on 31st March, 2009Gondkhari Coal Mining Limited

India 45.46 -

The Company’s interest in the joint venture is reported as Long Term Investments (Schedule - 6) and stated at cost.The Company’s share of each of the assets, liabilities, income and expenses (each without elimination of the effect of transactions between the Company and Joint Venture) related to interest in joint venture are :-

31st March, 2010 31st March, 2009I Assets Rs. Rs.

1. Fixed Assetsa) Net Block 2,07,365 - b) Capital Work in Progress 5,61,594 -

2. Current Assets, Loans and Advancesa) Cash and Bank Balances 32,359 - b) Loans and Advances 60 -

8,01,378 -

II Liabilities1. Current Liabilities 7,89,193 -

III Profi t and Loss Account Debit Balances 2,15,115 -

IV Income - -

V Expenditurea) Administrative Expenses 2,14,397 - b) Depreciation 718 -

2,15,115 - Share of Contingent Liabilites (Gurantees given by bank) 5,39,61,020 -

72

SCHEDULE 17 (Contd.)17A Details of pre-operative expenses incurred relating to expansion/ greenfi eld projects referred to in Note 3 above -

2009-2010

Up to During Total Capitalised/ Balance as on

31st March, 2009 2009-2010 Transferred 31st March, 2010

Rs. Rs. Rs. Rs. Rs.

(a) (b) (c ) = (a) + (b) (d) (c ) - (d)

Raw Materials consumed - 6,40,44,044 6,40,44,044 6,40,44,044 -

Work in process transferred to trial run - 87,10,670 87,10,670 87,10,670 -

Stores and Spare Parts Consumed - 9,14,961 9,14,961 9,14,961 -

Salaries, Wages, Bonus etc. 1,67,03,403 4,31,96,999 5,99,00,402 5,25,01,387 73,99,015

Contribution to Provident and Other Funds 10,62,543 25,10,801 35,73,344 31,46,898 4,26,446

Workmen and Staff Welfare 48,112 24,10,055 24,58,167 22,99,580 1,58,587

Power and Fuel 4,74,23,455 16,76,85,446 21,51,08,901 20,93,39,337 57,69,564

Repairs and Maintenance to Plant & Machinery 1,47,201 34,74,023 36,21,224 35,99,140 22,084

Rent 4,57,200 13,87,762 18,44,962 16,12,664 2,32,298

Rates & Taxes 6,14,147 14,47,371 20,61,518 15,63,947 4,97,571

Insurance 72,08,337 60,39,555 1,32,47,892 1,25,44,180 7,03,712

Miscellaneous Expenses 24,03,95,139 26,03,35,091 50,07,30,230 46,51,18,935 3,56,11,295

31,40,59,537 56,21,56,778 87,62,16,315 82,53,95,743 5,08,20,572

Interest 19,60,75,693 43,30,42,564 62,91,18,257 56,04,27,564 6,86,90,693

Total (A) 51,01,35,230 99,51,99,342 1,50,53,34,572 1,38,58,23,307 11,95,11,265

Sales Proceeds of items manufactured during Trial Run

- 27,96,98,632 27,96,98,632 27,96,98,632 -

[Clinker Sales - Rs.8,43,25,319 (32,309MT), Cement Sales - Rs.19,53,73,313 (64,734MT)]

Less:Excise Duty - 2,69,06,212 2,69,06,212 2,69,06,212 -

- 25,27,92,420 25,27,92,420 25,27,92,420 -

Scrap Sales during trial run - 88,99,947 88,99,947 88,99,947 -

- - -

Total (B) - 26,16,92,367 26,16,92,367 26,16,92,367 -

Net Pre-Operative Expenses (A-B) 51,01,35,230 73,35,06,975 1,24,36,42,205 1,12,41,30,940 11,95,11,265

Processed/Semi-Processed items transferred at the end of trial run (Schedule 14) 5,11,99,799

Capitalised 1,07,29,31,141

1,12,41,30,940


73

SCHEDULE 17 (Contd.)17B Details of pre-operative expenses incurred in 2008-09 relating to cement and tyre expansion/ greenfi eld projects -

2008-2009Up to During Total Capitalised/ Balance as on

31st March, 2008 2008-2009 Transferred 31st March, 2009 Rs. Rs. Rs. Rs. Rs. (a) (b) (c ) = (a) + (b) (d) (c ) - (d)

Raw Materials consumed - 3,21,49,062 3,21,49,062 3,21,49,062 - Stores and Spare Parts Consumed - 6,165 6,165 6,165 - Salaries, Wages, Bonus etc. 2,25,14,103 3,01,92,319 5,27,06,422 3,60,03,019 1,67,03,403 Contribution to Provident and Other Funds 12,31,512 25,20,678 37,52,190 26,89,647 10,62,543 Workmen and Staff Welfare 17,03,514 67,14,449 84,17,963 83,69,851 48,112 Power and Fuel 1,22,56,035 11,15,82,483 12,38,38,518 7,64,15,063 4,74,23,455 Repairs and Maintenance to Plant & Machinery - 2,70,317 2,70,317 1,23,116 1,47,201 Rent 6,29,485 31,64,890 37,94,375 33,37,175 4,57,200 Rates & Taxes 11,04,424 12,62,359 23,66,783 17,52,636 6,14,147 Insurance 55,19,905 59,90,949 1,15,10,854 43,02,517 72,08,337 Miscellaneous Expenses 13,77,27,255 28,08,80,862 41,86,08,117 17,82,12,978 24,03,95,139

18,26,86,233 47,47,34,533 65,74,20,766 34,33,61,229 31,40,59,537 Interest 8,14,85,169 32,98,75,355 41,13,60,524 21,52,84,831 19,60,75,693 Total (A) 26,41,71,402 80,46,09,888 1,06,87,81,290 55,86,46,060 51,01,35,230 Scrap Sales during trial run - 35,15,117 35,15,117 35,15,117 -

Total (B) - 35,15,117 35,15,117 35,15,117 -

Net Pre-Operative Expenses (A-B) 26,41,71,402 80,10,94,771 1,06,52,66,173 55,51,30,943 51,01,35,230

Power generated during Trial Run (Included under Power and Fuel in Schedule 15) 1,23,88,367 Semi-processed items transferred (Schedule 14) 3,08,21,279 Capitalised 51,19,21,297

55,51,30,943

18.1 13% Secured redeemable non convertible debentures aggregating Rs.1,00,00,00,000 (2008-09 - Rs.Nil), privately placed (allotment date -17th November,2008) have been redeemed at par by exercising put option during the year. On the aforesaid redemption, Rs.25,00,00,000, being 25% of the aforesaid value of debentures in Debenture Redemption Reserve, has been tranferred from Debenture Redemption Reserve to the Profi t and Loss Account.

18.2 7.3% secured redeemable non convertible debentures aggregating Rs 1,00,00,00,000 (31.03.2009 - Rs. Nil), privately placed (allotment date -17th November,2009) are due for redemption at par at the end of 13 months from the date of allotment. Debenture Redemption Reserve of Rs.25,00,00,000, being 25% of the aforesaid value of debentures, has been created out of the profi ts for the year.

19.1 Short term loans from banks (Schedule 4) include :-Commercial Paper of Rs.50,00,00,000 (31.03.09 - Rs.Nil).Short term loans from others (Schedule 4) comprise :-(a) Commercial Paper - Rs.2,40,00,00,000 (31.03.09 - Rs.Nil)(b) 6.4% redeemable non convertible debentures aggregating Rs.50,00,00,000 (31.03.09 - Rs.Nil), privately placed

(allotment date -17th March,2010) are due for redemption at par on 16th April, 2010.(c) 6.2% redeemable non convertible debentures aggregating Rs.15,00,00,000 (31.03.09 - Rs.Nil), privately placed

(allotment date -24th February,2010) are due for redemption at par on 24th May, 2010.(d) 6% redeemable non convertible debentures aggregating Rs.25,00,00,000 (31.03.09 - Rs.Nil) and Rs.25,00,00,000

(31.03.09 - Rs.Nil), privately placed (allotment dates -15th February, 2010 & 17th February, 2010) are due for redemption at par on 14th May, 2010 and 17th May, 2010 respectively.

(e) 5.71% redeemable non convertible debentures aggregating Rs.30,00,00,000 (31.03.09 - Rs.Nil), privately placed (allotment date -15th February,2010) are due for redemption at par on 12th May, 2010.

74

19.2 Other loans from banks (Schedule 4) include :-(a) Zero coupon unsecured redeemable non convertible debentures aggregating Rs 1,10,00,00,000 (31.03.2009 - Rs.Nil), privately

placed (allotment date -15th March, 2010) are due for redemption at par at the end of 396 days from the date of allotment.(b) 7.75% unsecured redeemable non convertible debentures aggregating Rs 50,00,00,000 (31.03.2009 - Rs.Nil) privately

placed (allotment date -19th March, 2010) are due for redemption at par on 5th April, 2011.(c) 8.35 % unsecured redeemable non convertible debentures aggregating Rs 1,00,00,00,000 (31.03.2009 - Rs.Nil) privately

placed (allotment date -22nd September, 2009) are due for redemption at par at the end of 377 days from the date of allotment.

19.3 Debenture redemption reserve of Rs 1,01,25,00,000, being 25% of the value debentures referred to in Notes 19.1 and 19.2 above has been created out the of profi t of the Company.

20 Pursuant to the Announcement on Accounting for Derivatives issued by the Institute of Chartered Accountants of India in March,2008,the company has accounted for during the year net loss amounting to Rs.1,43,41,747 (31.03.09 - Rs.17,36,12,270) in respect of outstanding derivative contracts at the Balance sheet date by marking them to market as indicated in Note 1 (g) above and the resultant excess liability of Rs.15,92,70,523 net of realised loss (net) of Rs.87,23,742 during the year arising from derivative contracts is written back and included in ‘Miscellaneous Income’ under Schedule 13 to accounts. In 2008-09, the aforesaid mark to market loss along with realised loss (net) of Rs.77,02,500 was included ‘Miscellaneous Expenses’ under schedule 15 to accounts.

21 a) Rent expenditure (Schedule 15) includes lease payments of Rs.18,19,595, (2008-09 - Rs.Nil) relating to non cancellable operating lease. This leasing arrangement is for three years and is in respect of offi ce premises. The signifi cant leasing arrangement interalia includes option for renewal.The total of future minimum lease payments under this non cancellable operating lease:(i) not later than one year - Rs.25,68,840 (2008-09 - Rs.Nil)(ii) later than one year but not later than fi ve years - Rs.33,18,085 (2008-09 - Rs.Nil)(iii) later than fi ve years - Rs.Nil (2008-09 - Rs.Nil)

b) The Company has given a unit of building on operating lease to Lazarus Hospital during the year for 5 years extendable up to 12 years on mutual consent

Amount in RupeesParticulars 2009-2010 2008-2009 Gross carrying amount as on Balance Sheet date 1,89,98,720 - Accumulated depreciation as on Balance Sheet date 1,03,226 - Depreciation recognised in the profi t and loss account 1,03,226 - The future minimum lease receivable under non-cancellable leases are as given below:not later than one year 21,47,760 - later than one year and not later than fi ve years 88,79,736 - later than fi ve years - - General Description of the aforesaid arrangement:Operating leases on renting a unit of building entered into by the Company is for a fi xed term of 5 years extendable up to 12 years.

22 Information pursuant to the provisions of paragraph 3, 4C and 4D of Part II of Schedule VI to the Companies Act, 1956 is given in Schedule 18, which forms an integral part of this Schedule.

2009-2010 2008-200923 Earnings Per Share (EPS)

Number of Ordinary shares at the beginning of the year 4,57,43,318 4,57,43,318 Number of Ordinary shares at the end of the year 4,57,43,318 4,57,43,318 Weighted average number of Ordinary shares outstanding during the year (A) 4,57,43,318 4,57,43,318 Nominal value of each Ordinary Share (Rs.) 10 10 Profi t after Tax (Rs.) (B) 2,37,33,74,177 3,78,74,09,901 Earnings per Share (Basic and Diluted) (Rs.) (B/A) 51.88 82.80



75

SCHEDULE 17 (Contd.)24 Information about Business segments

2009-2010Tyres Cement Rayon, T.P. and

ChemicalsOthers Total

Rs. Rs. Rs. Rs. Rs.Segment Revenue

Sales 28,49,61,85,651 19,12,74,47,483 2,59,35,37,897 35,57,275 50,22,07,28,306 Less: Inter segment Sales(made at cost) - 1,04,12,821 39,83,582 - 1,43,96,403

Total 28,49,61,85,651 19,11,70,34,662 2,58,95,54,315 35,57,275 50,20,63,31,903 Segment Results [Profi t/ (Loss)

after consideringOther Income and before interest and tax] 76,43,10,761 4,82,09,71,708 17,78,99,742 (3,69,57,067) 5,72,62,25,144

Interest (1,09,03,12,626)Other unallocated

income (net of expenditure) 11,90,30,930 Profi t Before Tax 4,75,49,43,448 Segment Assets 37,34,73,70,888 17,09,78,46,912 1,24,99,61,762 7,83,36,572 55,77,35,16,134 Unallocated Assets 1,75,86,35,210 Total 57,53,21,51,344 Segment Liabilities 5,27,54,12,532 1,60,19,56,553 30,88,41,218 90,18,612 7,19,52,28,915 Unallocated Liabilities 34,93,45,12,388Total 42,12,97,41,303 Segment Capital Expenditure 12,03,95,32,246 1,40,59,59,137 5,09,86,402 33,800 13,49,65,11,585 Segment Depreciation and

amortisation 80,18,07,386 87,29,68,787 4,86,48,027 24,38,553 1,72,58,62,753 Segment non-cash expenses

other than depreciation andamortisation - - 2,51,609 - 2,51,609

Principal Items manufactured Tyres, Tubes Cement Viscose Filamentand Flaps Rayon Yarn,

Cellophane Paper,Sulphuric Acid,

Caustic Soda Lye, Hydrochloric Acid

The Company operates predominantly within the geographical limits of India and accordingly secondary segments have not been considered.

76

SCHEDULE 17 (Contd.)Information about Business segments

2008-2009Tyres Cement Rayon, T.P. and

ChemicalsOthers Total

Rs. Rs. Rs. Rs. Rs.Segment Revenue

Sales 19,47,22,61,417 20,51,34,96,046 2,77,45,25,028 16,31,58,626 42,92,34,41,117 Less: Inter segment Sales(made at cost) - - 27,54,888 - 27,54,888

Total 19,47,22,61,417 20,51,34,96,046 2,77,17,70,140 16,31,58,626 42,92,06,86,229 Segment Results [Profi t/ (Loss)

after considering - Other Income and before interest and tax] 57,68,75,028 5,51,90,60,287 (4,49,76,597) (17,97,30,852) 5,87,12,27,866

Interest (1,20,87,21,809)Other unallocated expenditure

(net of income) (57,13,63,006)Profi t Before Tax 4,09,11,43,051 Segment Assets 21,43,70,08,939 15,58,42,75,180 1,28,98,31,351 13,90,27,489 38,45,01,42,959 Unallocated Assets 1,47,65,92,103Total 39,92,67,35,062Segment Liabilities 3,19,68,80,930 1,42,73,56,589 26,73,86,986 1,42,36,114 4,90,58,60,619 Unallocated Liabilities 21,71,98,25,298Total 26,62,56,85,917Segment Capital Expenditure 6,75,56,23,575 3,86,06,82,598 3,06,49,511 9,77,785 10,64,79,33,469 Segment Depreciation and

amortisation 46,05,81,567 60,61,02,383 4,70,61,318 28,72,133 1,11,66,17,401 Segment non-cash expenses

other than depreciation andamortisation - - 15,71,170 7,11,45,944 7,27,17,114

Principal Items manufactured Tyres, Tubesand Flaps

Cement Viscose FilamentRayon Yarn,

Cellophane Paper,Sulphuric Acid,

Caustic Soda Lye,Hydrochloric Acid

The Company operates predominantly within the geographical limits of India and accordingly secondary segments have not been considered.


77

II. Transactions Particulars 2009-2010

Related Parties referred to inI (a) above I (b) above I (c) above I (d) above I (e) above I (f) above

Rs. Rs. Rs. Rs. Rs. Rs. (i) Income

Rent & other Services- Century Textiles & Industries Ltd. - - - 27,14,687 - - - Century Enka Ltd. - - - 3,22,642 - -

Sales- Century Textiles & Industries Ltd. - - - 1,24,94,408 - - - Jay Shree Tea & Industries Ltd. - - - 19,57,399 - - - Century Enka Ltd. - - - 3,16,000 - -

Interest- Jay shree Tea & Industries Ltd. - - - 8,38,082 - -


25 Related Party Disclosures2009-2010 2008-2009

I. List of Related Parties(a) Parties where control exists

(i) Subsidiary * Bulland Buildmart Pvt. Ltd.(ii) Joint venture** Gondkhari Coal Mining Limited -

(b) Key Management Personnel - Shri K.C.Jain (Manager)- Shri D. Tandon***

- Shri K.C.Jain (Manager)-

(c) Relative of Key Management Personnel****

- Shri Sunil Jain (Son of Shri K.C.Jain)

- Shri Sunil Jain (Son of Shri K.C.Jain)

(d) Other Related Parties #- Syt.B.K.Birla - Syt.B.K.Birla

- Century Textiles & Industries Ltd. - Century Textiles & Industries Ltd.- Century Enka Ltd. - Century Enka Ltd.

- Jay Shree Tea & Industries Ltd. - Jay Shree Tea & Industries Ltd.(e) Enterprise having common Key

Management Personnel - Mangalam Cement Limited - Mangalam Cement Limited

(f) Enterprise over which person referred to in ‘(c)’ above is able to exercise signifi cant infl uence.

- Synergy Enterprises -

* Ceased to be a subsidiary on amalgamation referred to in Note 2 above.** Joint venture effective June 22, 2009*** Shri D. Tandon has been appointed as a Director w.e.f. January 01, 2010.**** Also proprietor of A.K. Enterprises.# The parties stated in (d) above are Related Parties in the broader sense of the term and are included for making the

fi nancial statements more transparent.

78

SCHEDULE 17 (Contd.)II. Transactions

Particulars 2009-2010Related Parties referred to in

I (a) above I (b) above I (c) above I (d) above I (e) above I (f) above Rs. Rs. Rs. Rs. Rs. Rs.

(ii) ExpenditureRent and Other Services

- Century Textiles & Industries Ltd. - - - 42,25,324 - - - Sunil Jain / A.K. Enterprises - - 19,97,404 - - - - Synergy Enterprises - - - - - 37,495

Expenses reimbursed- Sunil Jain / A.K. Enterprises - - 12,65,622 - - - - Synergy Enterprises - - - - - 7,32,089

Reimbursement for purchase of asset- Sunil Jain / A.K. Enterprises - - 31,762 - - -

Commission- Synergy Enterprises - - - - - 52,59,128

Interest Paid - Sunil Jain / A.K. Enterprises - - 3,45,196 - - - - Synergy Enterprises - - - - - 94,237

Remuneration [Refer Note 7(b)(iii) above]- K. C. Jain - 72,73,657 - - - - - D. Tandon - 27,59,365 - - - -

Purchases- Century Textiles & Industries Ltd. - - - 44,94,63,624 - - - Century Enka Ltd. - - - 2,06,06,70,334 - - - Jay Shree Tea & Industries Ltd. - - - 3,54,80,918 - - - Mangalam Cement Limited - - - - 3,91,73,062 -

Directors’ Fees- Syt. B.K.Birla - - - 1,00,000 - -

Directors’ Commission- Syt. B.K.Birla - - - 3,00,000 - -

(iii) Finance & InvestmentLoan Given to Jay Shree Tea & Industries Ltd.

- - - 23,00,00,000 - -

Realisation of loan Given to Jay Shree Tea & Industries Ltd.

- - - 23,00,00,000 - -

Investment in shares of Gondkhari Coal Mining Ltd.

2,27,280 - - - - -


79



I (a) above I (b) above

I (c) above I (d) above I (e) above I (f) above

Rs. Rs. Rs. Rs. Rs. Rs.

(iv) OthersDividend paid- Century Textiles & Industries Ltd. - - - 1,17,26,000 - - - Century Enka Ltd. - - - 32,17,468 - - - Jay Shree Tea & Industries Ltd. - - - 58,24,989 - -

Dividend received- Century Textiles & Industries Ltd. - - - 1,23,57,450 - - - Century Enka Ltd. - - - 67,03,400 - - - Mangalam Cement Ltd. - - - - 1,57,41,000 - - Jay Shree Tea & Industries Ltd. - - - 5,82,174 - -

(v) Balance Outstanding at year endSecurity deposit payable- Sunil Jain / A.K. Enterprises - - 34,51,961 - - - - Synergy Enterprises - - - - - 9,42,374

Directors’ Commission- Syt. B.K. Birla - - - 3,00,000 - -

Interest payable- Sunil Jain / A.K. Enterprises - - 3,10,676 - - - - Synergy Enterprises - - - - - 84,813

Other payable - Century Textiles & Industries Ltd. - - - 3,22,07,437 - - - Century Enka Ltd. - - - 26,20,80,627 - - - Sunil Jain / A.K. Enterprises - - 4,26,401 - - - - Synergy Enterprises - - - - - 15,74,308

Other receivables- Century Textiles & Industries Ltd. - - - 40,83,142 - - - Mangalam Cement Ltd. - - - - 43,78,643 - - Jay Shree Tea & Industries Ltd. - - - 3,25,513 - - - Sunil Jain / A.K. Enterprises - - 3,000 - - - - Gondkhari Coal Mining Limted 15,10,765 - - - - -

Investment in shares - Gondkhari Coal Mining Ltd. 2,27,280 - - - - - - Century Textiles & Industries Ltd. - - 16,92,99,738 - - - Century Enka Ltd. - - - 12,91,29,764 - - - Mangalam Cement Ltd. - - - - 4,65,41,500 - - Jay Shree Tea & Industries Ltd. - - - 1,18,600 - -

80




I (c) above I (d) above I (e) above

Rs. Rs. Rs. Rs. Rs. (i) Income

Rent & other Services- Century Textiles & Industries Ltd. - - - 34,00,984 - - Century Enka Ltd. - - - 3,19,292 -

Sales- Century Textiles & Industries Ltd. - - - 93,07,580 - - Others - - - 9,34,384 -

(ii) ExpenditureRent and other Services- Century Textiles & Industries Ltd. - - - 40,64,647 - - Others - - 18,99,432 - -

Commission - - 33,08,366 - - Interest Paid - - 4,17,402 - 90,73,974

Remuneration [Refer Note 7(b)(iii) above] - 62,84,959 - - -

Purchases- Century Textiles & Industries Ltd. - - - 53,80,63,722 - - Century Enka Ltd. - - - 1,25,24,44,481 -

Directors’ Fees- Syt.B.K.Birla - - - 80,000 -

Directors’ Commission- Syt.B.K.Birla - - 2,50,000 -

(iii) Finance & Investment - Loan given 41,50,00,000 - - - - Security deposit taken - - 42,374 - - Loan taken - - - - 23,00,00,000 Repayment of Loan Taken - - - - 23,00,00,000 Investment in shares 12,60,00,000 - - - -

(iv) OthersDividend paid- Century Textiles & Industries Ltd. - - - 56,73,000 - - Century Enka Ltd. - - - 4,533,704 - - Jay Shree Tea & Industries Ltd. - - - 79,36,690 -


81

31st March, 2010 31st March, 2009Rs. Rs.

26 Shares of Jay Shree Tea & Industries Ltd. held by the Company at face value being bonus shares remaining unclaimed.

1,57,260 1,57,260

27 Certain records/ documents pertaining to production, raw materials, purchase records etc. of the Company’s Assam Cotton Mills Unit were seized by the Excise Authorities and are presently not available with the Company.

28 Previous year’s figures have been regrouped or rearranged where considered necessary.

Signatures to Schedules 1 to 17




I (c) above I (d) above I (e) above

Rs. Rs. Rs. Rs. Rs. Dividend received- Century Textiles & Industries Ltd. - - - 1,23,57,450 - - Century Enka Ltd. - - - 67,03,400 - - Mangalam Cement Ltd. - - - - 1,43,10,000 - Jay Shree Tea & Industries Ltd. - - - 4,85,145 -

(v) Balance outstanding at year endSecurity deposit payable - - 43,94,335 - - Loan receivable 41,50,00,000 - - - - Directors’ Commission- Syt. B.K. Birla - - - 2,50,000 -

Other payable - Century Textiles & Industries Ltd. - - - 3,26,25,639 - - Century Enka Ltd. - - - 9,59,16,974 - - Others - - 12,89,705 284 -

Other receivable- Century Textiles & Industries Ltd. - - - 13,18,071 - - Jay Shree Tea & Industries Ltd. - - - 34,163 -

Investment in Shares- Bulland Buildmart Pvt. Ltd. 12,60,00,000 - - - - - Century Enka Ltd. - - - 12,91,29,764 - - Century Textiles & Industries Ltd. - - - 16,92,99,738 - - Mangalam Cement Ltd. - - - - 4,65,41,500 - Jay Shree Tea & Industries Ltd. - - - 1,18,600 -








K. G. MAHESHWARI

Directors


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9 *

33,30

7 *

(vi)

Visco

se Fi

lamen

t Ray

on Ya

rn 10

To

ns pe

r day

6,50

0 M.

Tons

per y

ear

M.T.

7,89

8 7,

768

Spun

Pipe

s &

Cast

Iron S

pun P

ipes &

Pipe

Foun

dries

Fittin

gs 45

,000

M. T

ons p

er ye

ar

45,00

0 M.

Tons

per y

ear

M.T.

- 2,

692

Tyre

(i)

Tyre

sNo

t app

licab

le1,2

1,02,0

00No

s. pe

r yea

rNo

.44

,98,20

724

,19,91

6[20

08-2

009 3

7,10,0

00 N

os. p

er ye

ar]

(inclu

ding 6

0,491

nos.

manu

factur

edby

contr

act

manu

factur

er)

(ii)

T ube

sNo

t app

licab

le29

,50,00

0No

s. pe

r yea

rNo

.43

,21,70

720

,12,48

5(in

cludin

g 17,1

6,681

(inclu

ding 8

,14,09

5no

s. ma

nufac

tured

nos.

manu

factur

edby

contr

act

by co

ntrac

tma

nufac

turer

)ma

nufac

turer

)(iii

) Fla

psNo

t app

licab

le 15

,25,00

0 No

s. pe

r yea

rNo

.26

,44,25

213

,23,49

1(in

cludin

g 16,1

8,935

(inclu

ding 3

,09,51

6no

s. ma

nufac

tured

nos.

manu

factur

edby

contr

act

by co

ntrac

tma

nufac

turer

)ma

nufac

turer

)


83

SCHE

DULE

18 (C

ontin

ued)

(1) P

artic

ulars

in re

spec

t of g

oods

man

ufactu

red (

Contd

.) :

PR

ODUC

TION

CAPA

CITY

(Me

ant fo

r Sale

)Lic

ense

dIns

talled

(a)

Manu

factur

ingCl

ass o

f goo

ds m

anufa

cture

d20

09-2

010

2009

-201

0Un

it20

09-2

010

2008

-200

9Se

ction

(Sam

e as 2

008-

2009

exce

pt oth

erwi

se in

dicate

d)(S

ame a

s 200

8-20

09 ex

cept

other

wise

indic

ated)

Hind

ustan

Hea

vy(i)

Ca

ustic

Sod

a Lye

(100

%)

15,12

0 M.

Tons

per y

ear

12,41

0 M

. Ton

s per

year

M.

T. 11

,663

* 11

,737

*Ch

emica

ls (ii)

Liq

uid C

hlorin

e 6,

000

M. To

ns pe

r yea

r 5,

045

M. T

ons p

er ye

ar

M.T.

4,83

1 *

4,95

9 *

(iii)

Sodiu

m Hy

poch

lorite

16

,500

M. To

ns pe

r yea

r 6,

205

M. T

ons p

er ye

ar

M.T.

2,68

6 3,

567

(iv)

Hydr

ochlo

ric A

cid (1

00%

) 9,

750

M. To

ns pe

r yea

r 8,

200

M. T

ons p

er ye

ar

M.T.

5,37

3 *

5,33

6 *

(v)

Ferri

c Alum

(inclu

ding

Alum

Liqu

or)

3,20

0 M.

Tons

per y

ear

3,20

0 M

. Ton

s per

year

M.

T. -

-

(vi)

Sulph

uric

Acid

(inclu

ding

Batte

ry Gr

ade)

20,40

0 M.

Tons

per y

ear

18,70

0 M

. Ton

s per

year

M.

T. 19

,061

* 19

,139

*

(vii)

Purifi

ed H

ydro

gen G

as 30

,24,00

0 M 3 pe

r yea

r16

,20,00

0M

3 per y

ear

M 3

7,53,4

53*

8,18,8

82*

* Pro

ducti

on is

inclu

sive o

f inter

nal c

onsu

mptio

n.

(a)

Instal

led ca

pacit

ies ha

ve be

en ce

rtifi ed

by th

e Com

pany

’s Te

chnic

al Ex

perts

. Fur

therm

ore,

the in

stalle

d cap

acity

of th

e Tra

nspa

rent

Pape

r Sec

tion i

s also

as pe

r Com

pany

’s ap

plica

tion t

o the

Gov

ernm

ent o

f India

for C

.O.B

. Lice

nce.

84

SCHE

DULE

18 (C

ontin

ued)

(2) P

artic

ular

s in

resp

ect o

f sto

cks a

nd sa

les o

f goo

ds m

anuf

actu

red/

trad

ed :

Stoc

k as a

t 31.0

3.200

8St

ock a

s at 3

1.03.2

009

Stoc

k as a

t 31.0

3.201

0Sa

lesSt

ock a

s at 0

1.04.2

009

2009

-201

020

08-2

009

Unit

Quan

tityVa

lueQu

antity

Value

Quan

tityVa

lueQu

antity

Value

Quan

tityVa

lueRs

.Rs

.Rs

.Rs

.Rs

.Ce

ment

- A

t Bas

antna

gar

M.T.

4,30

3 68

,48,42

6 6,

129

1,18,7

7,374

17,85

8 3,7

9,37,0

5913

,66,35

94,1

7,12,7

4,801

15,07

,729

5,23,9

4,09,4

31 (E

xclud

ing in

terna

l co

nsum

ption

of

745 M

T)

(Exc

luding

inter

nal

cons

umpti

on of

2,

060 M

T)

At S

edam

M.T .

46,80

9 9,

87,19

,383

35,62

76,8

7,28,6

24 83

,042

17,58

,19,22

840

,76,62

013

,91,33

,34,48

7 39

,09,94

1 14

,92,83

,23,08

5 (E

xclud

ing in

terna

l co

nsum

ption

of

14,60

4 MT

and s

ale

durin

g tria

l run o

f 64

,734 M

T)

(Exc

luding

inter

nal

cons

umpti

on of

25

,830 M

T)

Carb

on-d

i-Sulp

hide

M.T.

189

38,50

,964

186

46,39

,175

129

27,11

,598

2,20

3 6,8

7,09,5

67 1,

603

8,43,2

2,166

(Exc

luding

inter

nal

cons

umpti

on of

2,

657 M

T)

(Exc

luding

inter

nal

cons

umpti

on of

2,

639 M

T)

Cello

phan

e Pap

er(T

rans

pare

ntCe

llulos

e Film

)M.

T . 35

3 6,

27,05

,221

384

7,64,5

0,996

216

4,15,7

9,030

2,398

45,02

,89,46

0 2,

076

37,40

,91,34

2 (E

xclud

ing in

terna

l co

nsum

ption

of

1 MT

)

(Exc

luding

inter

nal

cons

umpti

on of

1

MT)

Sodiu

m Su

lphate

M.T.

22

1,36

,864

20

1,18,1

75 22

6 13

,16,22

96,7

615,9

3,24,8

60 6,

721

6,82,2

4,054

(Exc

luding

inter

nal

cons

umpti

on of

4

MT)

(Exc

luding

inter

nal

cons

umpti

on of

10

MT)

So

dium

Sulph

ideM.

T. 2

70,19

7 1

9,836

- -

9 1,0

3,550

10

1,31,1

74

Sulph

uric

Acid

M.T.

464

12,25

,967

329

6,58,2

52 35

8 4,9

8,832

29,04

8 (E

xclud

ing in

terna

l co

nsum

ption

of

8,80

2 MT)

7,22,5

2,868

24,69

4 (E

xclud

ing in

terna

l co

nsum

ption

of

8,74

8 MT)

26,28

,70,91

8

Visc

ose F

ilame

nt Ra

yon Y

arn

M.T.

445

7,49

,10,25

5 33

3 6,8

8,54,9

01 30

8 6,6

7,09,6

21 7,

923

1,71,5

2,40,0

58 7,

880

1,59,0

6,93,0

72


85

SCHE

DULE

18 (C

ontin

ued)

(2) P

artic

ular

s in

resp

ect o

f sto

cks a

nd sa

les o

f goo

ds m

anuf

actu

red/

trad

ed :

(Con

td.)

Stoc

k as a

t 31.0

3.200

8St

ock a

s at 3

1.03.2

009

Stoc

k as a

t 31.0

3.201

0Sa

lesSt

ock a

s at 0

1.04.2

009

2009

-201

020

08-2

009

Unit

Quan

tityVa

lueQu

antity

Value

Quan

tityVa

lueQu

antity

Value

Quan

tityVa

lueRs

.Rs

.Rs

.Rs

.Rs

.Ca

st Iro

n Spu

nPi

pes &

Pipe

Fittin

gsM.

T. 3,

010

9,09

,70,95

1 85

4 3,7

0,357

692

3,70

,357

162

35,57

,275

4,84

8 16

,31,58

,626

Marke

t Fitti

ngs

Pcs.

5,25

3 1,

58,67

3 3,

813

6,08

2 3,

813

6,08

2 -

- -

- [E

xclud

ing in

terna

l co

nsum

ption

of 5,

561 p

cs.]

Tyre

s, T u

bes &

Flaps

(Set)

pu

rchas

edNo

. 1,

582

1,45

,52,84

8 48

5,

74,16

9 14

5 15

,86,15

3 1,

266

1,41,2

9,405

2,08

4 2,1

9,78,4

90

Tyre

sNo

. 1,

12,71

6 49

,00,81

,382

1,75,7

381,1

9,19,5

4,068

6,29,1

202,1

0,24,5

1,524

40,44

,825

25,51

,57,03

,769

23,56

,894

17,55

,42,93

,701

Tube

sNo

. 1,

58,33

5 6,

55,98

,196

2,89,1

9318

,13,26

,703

9,19,6

3633

,35,40

,387

39,34

,503

2,23,7

6,45,4

6122

,60,87

81,4

3,24,1

2,688

[Inclu

ding

2,757

nos.

(Rs.2

3,14,0

95)

Pur

chas

ed]

[Inclu

ding

42,73

8 nos

. (R

s.4,12

,98,21

1)

Pur

chas

ed]

[Inclu

ding

64,74

9 nos

. (R

s.5,03

,03,59

7)

Pur

chas

ed]

[Inclu

ding

2,21,2

28 no

s. (R

s.17,7

3,63,3

75)

on sa

le of

Purch

ased

]

[Inclu

ding

3,39,2

70 n

os.

(Rs.3

6,34,5

5,406

) on

sale

of Pu

rchas

ed]

Flaps

No.

81,05

7 1,

57,91

,943

1,86

,046

3,80

,41,89

4 3,

79,28

8 8,

21,92

,333

30,87

,950

58,06

,06,41

020

,63,31

937

,60,85

,206

[Inclu

ding

11,78

1 nos

. (R

s.21,4

9,962

) P

urch

ased

]

[Inclu

ding

43,48

5 nos

. (R

s.96,4

1,099

) P

urch

ased

]

[Inclu

ding

55,76

8 nos

. (R

s.1,19

,54,06

5)

Pur

chas

ed]

[Inclu

ding

6,24,6

57 no

s. (R

s.12,9

7,98,9

73)

on sa

le of

Purch

ased

]

[Inclu

ding

8,13,1

13 n

os.

(Rs.1

8,38,2

2,476

) on

sale

of Pu

rchas

ed]

Caus

tic S

oda

Lye (

100%

)M.

T. 31

6 60

,28,38

9 57

12

,45,10

2 75

17

,42,37

4 4,

826

11,53

,33,43

1 5,

257

13,00

,86,52

8 (E

xclud

ing

inter

nal

cons

umpti

on of

6,

819 M

T)

(Exc

luding

inter

nal

cons

umpti

on of

6,

739 M

T)

Liquid

Chlo

rine

M.T.

36

1,29,4

57 26

30

,590

38

1,45,7

96 4,

760

1,60,9

1,306

4,91

3 2,6

9,75,9

47 (E

xclud

ing

inter

nal

(Exc

luding

int

erna

l co

nsum

ption

of

cons

umpti

on of

59

MT)

56

MT)

So

dium

Hypo

chlor

ite

M.T.

69

1,06,9

77 34

57

,184

24

37,62

4 2,

696

41,89

,955

3,60

2 59

,95,30

9

86

SCHE

DULE

18 (C

ontin

ued)

(2) P

artic

ular

s in

resp

ect o

f sto

cks a

nd sa

les o

f goo

ds m

anuf

actu

red/

trad

ed :

(Con

td.)

Stoc

k as a

t 31.0

3.200

8St

ock a

s at 3

1.03.2

009

Stoc

k as a

t 31.0

3.201

0Sa

lesSt

ock a

s at 0

1.04.2

009

2009

-201

020

08-2

009

Unit

Quan

tityVa

lueQu

antity

Value

Quan

tityVa

lueQu

antity

Value

Quan

tityVa

lueRs

.Rs

.Rs

.Rs

.Rs

.Hy

droc

hloric

Acid

(100

%)

M.T.

75

1,07

,668

58

71,73

8 20

40

,373

5,08

9 2,3

3,01,8

16 5,

068

3,22,3

9,596

(Exc

luding

inter

nal

(Exc

luding

inter

nal

cons

umpti

on of

co

nsum

ption

of

322 M

T)

285 M

T)

Ferri

c Alum

(in

cludin

g Alum

Liqu

or)

M.T.

136

9,70,0

44 -

- -

- -

- 78

5,9

2,769

(Exc

luding

inter

nal

cons

umpti

on of

58

MT)

Su

lphur

ic Ac

id (in

cludin

g Batt

ery

Gra

de)

M.T.

270

14,44

,813

159

4,96,3

9414

24,7

5,029

17,98

5 4,9

5,73,1

40 18

,140

18,04

,69,56

9 (E

xclud

ing in

terna

l (E

xclud

ing in

terna

l co

nsum

ption

of

cons

umpti

on of

1,

093 M

T)

1,11

0 MT)

Pu

rifi ed

Hyd

roge

n Ga

sM3

6,89

7 90

,783

7,58

7 78

,905

7,915

95,71

7 7,

52,69

0 1,5

1,44,3

048,1

7,682

1,50,7

7,696

(Exc

luding

inter

nal

(Exc

luding

inter

nal

cons

umpti

on of

co

nsum

ption

of

435 M

3 ) 51

0 M3 )

Othe

rs2,2

2,26,7

443,8

4,55,2

665,8

4,95,3

371,1

8,05,2

5,980

43,32

,54,86

2

95,67

,26,14

51,6

8,40,4

5,785

2,90,7

7,50,6

8350

,20,63

,31,90

342

,92,06

,86,22

9


87

SCHEDULE 18 (Continued)(3) Consumption of Raw Materials :

2009-2010 2008-2009Manufacturing Class of Materials Unit Quantity Value Quantity Value @Section Rs. Rs.Cement - At Basantnagar Limestone M.T. 15,65,000 38,30,76,177 14,85,000 34,08,60,812

Bauxite/ Laterite/Hematite M.T. 1,00,881 9,06,51,896 93,977 7,65,62,388Gypsum M.T. 36,993 6,11,72,968 46,931 7,91,28,186Fly Ash M.T. 2,69,812 5,26,46,531 3,02,966 5,48,82,031

At Sedam Limestone M.T. 57,83,419 # 50,40,96,852 # 47,67,475 # 39,11,97,993 # Bauxite/ Laterite/Hematite M.T. 3,81,724 # 21,68,51,329 # 2,96,702 # 13,94,44,574 # Gypsum M.T. 1,19,725 # 23,26,92,257 # 1,26,023 23,62,28,299Fly Ash M.T. 3,68,327 11,76,65,222 3,89,316 15,24,50,252

Rayon &TransparentPaper Wood Pulp M.T. 10,364 53,97,06,438 10,127 55,50,74,979

Caustic Soda M.T. 240 50,50,576 149 35,40,786Sulphur M.T. 17,413 9,46,46,302 15,299 38,10,06,740Sundries 3,76,71,221 3,21,23,252

Spun Pipes & Foundries Pig Iron M.T. - - 2,528 7,49,00,406

C I Scrap M.T. - - 208 48,26,913Limestone M.T. - - 267 24,91,281Hard Coke M.T. - - 714 71,52,961Ferro Silicon M.T. - - 35 23,90,911Sundries - 3,20,821

Tyre Natural Rubber M.T. 76,395 # 8,47,21,46,802 # 48,968 # 5,76,95,15,020 # Synthetic Rubber M.T. 21,518 # 2,93,63,29,510 # 11,378 # 1,81,34,69,337 # Carbon Black M.T. 48,002 # 2,54,52,24,531 # 29,425 # 1,59,17,21,495 # Fabric M.T. 19,660 # 4,29,09,20,616 # 13,294 # 2,86,93,59,093 # Other Chemicals and Sundries 3,03,06,57,219 # 1,94,27,53,771 #

Hindusthan Heavy Salt M.T. 21,400 6,60,65,485 19,010 5,65,23,607Chemicals Hydrated Lime (90%) M.T. 260 13,49,046 188 10,27,147

Sulphur M.T. 6,489 3,80,23,359 6,206 23,04,88,456Sundries 52,91,723 39,21,897

23,72,19,36,060 16,81,33,63,408

# Excludes 1,79,500 MT (Rs.1,78,01,304) of Limestone [2008-09 - 37,968 MT (Rs.41,60,041)], 11,860 MT (Rs.50,05,464) of Bauxite/Laterite [2008-09 - 2,522 MT (Rs.6,70,137)], 2,054 MT (Rs.38,29,751) of Gypsum (2008-09-Nil), 127 MT (Rs.1,31,61,539) of Natural Rubber [2008-09 - 68 MT (Rs.76,27,245)], 39 MT (Rs.43,02,490) of Synthetic Rubber [2008-09 - 14 MT (Rs.21,93,939)], 88 MT (Rs.55,55,367) of Carbon Black [2008-09 - 40 MT (Rs.22,58,796)], 5 MT (Rs.12,77,863) of Fabric [2008-09 - 61 MT (Rs.78,86,328) and Rs.1,31,10,266 other chemicals/ Sundries [2008-09 - Rs.73,52,576] consumed during the trial run period relating to Cement expansion and Green fi eld Tyre Projects at Company’s Vasavadatta Cement Unit and Birla Tyres unit.

@ After considering related adjustment for sales value referred to in Schedule 14 of Accounts.

88

SCHEDULE 18 (Continued)(4) Value of Imported and Indigenous Raw Materials, Stores, Spare Parts and Components consumed during the year :

2009-2010 2008-2009Raw Materials @ Stores, Spare Parts &

Components #Raw Materials @ Stores, Spare Parts &

Components #Rs. % Rs. % Rs. % Rs. %

Imported 4,83,95,84,471 20.40 9,37,79,654 1.07 3,84,00,01,338 22.84 19,40,65,051 2.25Indigenous 18,88,23,51,589 79.60 8,64,77,00,610 # 98.93 12,97,33,62,070 77.16 8,43,69,99,431 # 97.75

23,72,19,36,060 100.00 8,74,14,80,264 * 100.00 16,81,33,63,408 * 100.00 8,63,10,64,482 * 100.00

@ excluding Rs.6,40,44,044 (imported - Rs.2,13,19,000, indigenous - Rs.4,27,25,044), [2008-2009 - Rs. 3,21,49,062 (imported - Rs. 21,91,045, indigenous - Rs. 2,99,58,017)] raw materials consumed during trial run relating to Cement expansion and Green fi eld Tyre project at Company’s Vasavadatta Cement Unit and Birla Tyres Unit.

# excluding Rs.9,14,961 (2008-2009 - Rs. 6,165) consumed during trial run period relating to cement expansion project at Company’s Vasavadatta Cement Unit.* After considering related adjustment for sale value referred to in Schedule 14 & 15 of Accounts.(5) Value of Imports (C.I.F Basis) during the year : 2009-2010 2008-2009

Rs. Rs.Raw Materials 4,39,93,17,571 3,44,61,01,509Components and Spare Parts (including Stores) 10,77,88,848 27,45,82,279Capital Goods 3,24,70,58,507 1,62,42,74,022

7,75,41,64,926 5,34,49,57,810(6) Expenditure in Foreign Currency during the year (on payment basis) :

Technical Service Fees 6,04,85,577 1,26,38,239Brokerage and Discount 11,04,653 1,11,19,017Interest 36,94,29,138 34,94,33,757Miscellaneous (Travelling etc.) 2,83,72,150 2,70,79,023

(7) Earnings in Foreign Exchange during the year :Exports (excluding export to Nepal and Bhutan) of goods [F.O. B. - Realisation basis] 3,75,03,67,020 2,54,16,71,323

(8) Remittances in Foreign Currency on account of Dividend :Number of

non-resident Number of Financial Year On Account of Shareholders Shares held Dividend

2009-2010 2008-2009 2 73,41,875 2,38,61,094Final

2009-2010 1 70,41,875 1,58,44,219Interim

2008-2009 2007-2008 1 70,41,875 3,87,30,313Final

2008-2009 1 70,41,875 1,58,44,219Interim

Signatures to Schedule 18








K. G. MAHESHWARI

Directors



89

CASH FLOW STATEMENT FOR THE YEAR ENDED 31ST MARCH, 2010 For the year ended 31st March, 2010

Rs.

For the year ended 31st March, 2009

Rs. A. Cash Flow from Operating Activities

Net Profi t Before Tax 4,75,49,43,448 4,09,11,43,051 Adjustments for:

Depreciation 1,72,80,03,438 1,11,85,61,067 (Profi t)/ loss on Fixed Assets sold / discarded (net) 26,23,824 (3,35,17,858)Profi t on sale of Long Term Investments (other than trade) - (36,14,099)Profi t on sale of Current Investments (other than trade) (42,250) (76,319)Income from Long Term Investments (other than trade) (4,74,18,383) (4,72,50,844)Dividend from Current Investments (other than trade) (46,55,917) (19,43,811)Borrowing Cost [including interest Rs.1,09,03,12,626 (Previous year -Rs.1,20,87,21,809) paid/payable on loans 1,25,11,07,404 1,29,59,66,293 Interest received/receivable on loans etc. (88,53,852) (83,89,262)Provision for Doubtful debts 2,51,609 5,28,089 Debts / Advances / Deposits written off - 7,22,15,354 Long Term Investments (other than trade) written off - 13,000 Liabilities no longer required written back (2,07,22,174) (4,64,64,863)Unrealised(Gain)/ Loss on derivative contracts (net) (15,92,70,523) 10,91,66,989 [2009-10 : after considering reversal of excess liability]Unrealised (Gain)/ Loss on foreign currency fl uctuation (net) (14,05,95,767) 10,63,09,576

Operating profi t before working capital changes 7,35,53,70,857 6,65,26,46,363 Adjustments for :

Inventories (3,27,13,28,413) (1,46,89,11,160)Trade and other receivables (2,36,09,35,689) (1,06,06,80,673)Trade Payables 1,88,51,60,479 42,27,51,290

Cash generated from operations 3,60,82,67,234 4,54,58,05,820 Direct taxes paid (net of refunds) (1,04,28,07,755) (84,31,62,185)

Net cash from operating activities 2,56,54,59,479 3,70,26,43,635 B. Cash Flow from Investing Activities

Purchase of fi xed assets (12,58,46,26,265) (9,89,08,18,749)Proceeds from sale of fi xed assets 61,37,205 5,02,30,352 Trade investment in Joint Venture (2,27,280) - Purchase of Long Term Investment (other than trade) (2,23,00,000) (14,17,70,160){2008-09: including Rs.12,60,00,000 paid for acquisition of subsidiary}Purchase of Current Investments (other than trade) (11,48,03,85,394) (2,60,69,43,811)Proceeds from sale of Current Investments (other than trade) 11,48,04,27,644 2,60,70,20,130 Proceeds from sale/redemption of Long Term Investments (other than trade)

- 58,28,400

Income from Long Term Investments (other than trade) 4,74,18,383 4,72,50,844 Dividend from Current Investments (other than trade) 46,55,917 19,43,811 Loans given (23,04,00,000) (44,00,00,000)Realisation of Loans given 25,00,00,000 1,52,00,000 Interest received on loans,deposits etc. 59,43,472 49,17,237

Net cash used in investing activities (12,52,33,56,318) (10,34,71,41,946)

90

CASH FLOW STATEMENT (Contd.) For the year ended 31st March, 2010

Rs.

For the year ended 31st March, 2009

Rs. C. Cash Flow from Financing Activities

Proceeds from -Long-term borrowings 14,83,36,10,022 11,11,58,77,507 Short-term borrowings 67,70,96,56,040 69,25,45,39,180

Unclaimed debentures paid/transferred - (2,53,82,188)Repayment of -

Long-term borrowings (9,61,46,71,768) (2,67,45,73,561)Short-term borrowings (60,71,83,45,761) (68,02,19,57,779)

Increase/(Decrease) in cash credit and overdrafts from banks 6,74,05,843 (81,52,49,830)Borrowing Cost [including interest Rs.1,55,71,09,516 (Previous year - Rs.1,39,15,13,827) paid

(1,79,13,54,465) (1,61,50,42,037)

Dividends Paid during the year (including taxes thereon) (29,25,41,324) (41,05,81,720)Net Cash from fi nancing activities 10,19,37,58,587 6,80,76,29,572 Net Increase in Cash and Cash Equivalents 23,58,61,748 16,31,31,261 Opening Cash and Cash Equivalents 56,85,52,594 40,54,21,333 Cash and Cash equivalents consequent to amalgamation (Note 2) 73,935 - Closing Cash and Cash Equivalents (Note 3) 80,44,88,277 56,85,52,594

Notes :

1 The above cash fl ow statement has been prepared under the Indirect Method as set out in the Accounting Standard - 3 on Cash Flow Statements.

2 Pursuant to scheme of Amalgamation (the’Scheme’) sanctioned by the High Court at Calcutta in July 2009, Bulland Buildmart Private Limited (Transferor Company) has been amalgamated with Kesoram Industries Limited (Tansferee Company) with retrospective effect from 1st October 2008 (Appointed Date). In accordance with the Scheme, all assets and liabilities of the Transferor Company immediately preceding the Appointed Date have been incorporated in the books of account of Transferee Company at their respective book values on the basis of audited accounts of the Transferor Company. The net assets as per the books of account of the Tranferor Company after cancellation of investment of the Transferee Company in Tranferor Company as on 30th September, 2008 has been credited to Capital Reserve of the Transferee Company in 2009-10 and the results of the Transferor Company for the period 1st October, 2008 to 31st March, 2009 has been adjusted with the opening cradit balance in Profi t & Loss Account of Transferee Company. Also refer Note 2 on Schedule 17 to Accounts.


3 Cash and Cash Equivalents comprise :Cash in Hand 36,27,459 83,38,292 With Scheduled Banks on -

Current Account 78,11,08,183 54,25,66,016 Unpaid Dividend Account 1,66,16,447 1,48,12,098 Term Deposits Account 31,31,188 28,31,188

With Post Offi ce Savings Bank Account 5,000 5,000 80,44,88,277 56,85,52,594

This is the Cash Flow Statement referred to in our report of even date.








K. G. MAHESHWARI

Directors



91

Information pursuant to Part IV of Schedule VI to the Companies Act, 1956:Balance Sheet abstract and Company’s General Business Profi le1. Registration Details

Registration Number 3429State Code 21Balance Sheet Date 31st March, 2010

(Amount in Rs. Thousands)

2. Capital raised during the yearPublic Issue NilRights Issue NilBonus Issue NilPrivate Placement Nil

3. Position of mobilisation and deployment of fundsTotal Liabilities [excluding shareholders funds and including Deferred tax liability (Net) Rs.32,84,383 thousands] 4,21,29,741Total Assets (excluding Deferred tax assets) 5,75,32,151

Sources of FundsPaid up Capital 4,57,416Reserves & Surplus 1,49,44,994Secured Loan 1,86,37,153Unsecured Loan 1,47,72,036

Application of FundsNet Fixed Assets 3,84,46,539Investments 5,14,337Current Assets (net of current liabilities and provisions Rs.54,36,170 thousands) 1,31,35,106Miscellaneous Expenditure NilAccumulated Losses Nil

4. Performance of the CompanyTurnover (including other income) 4,85,57,214Total Expenditure 4,38,02,270Profi t before Tax 47,54,943Profi t after Tax 23,73,374Earnings Per Share (Rs.) 51.88Interim Dividend Rate (%) [on Ordinary Shares] 22.5Dividend Rate (%) [on Ordinary Shares] 32.5

5. Generic Names of principal products, services of the Company(as per monetary terms)(i) Item Code No. 324101000.00

Product Description Portland Cement(ii) Item Code No. 540331.00

Product Description Artifi cial Filament Viscose Rayon Yarn(iii) Item Code No. 401120.00

Product Description Automobile Tyres (for bus & lorry)(iv) Item Code No. 401310.02

Product Description Automobile Tubes (for bus & lorry)(v) Item Code No. 401290.04

Product Description Automobile Flaps (for bus & lorry)

92

Notes

KESORAM INDUSTRIES LIMITEDRegd. Offi ce: 8th Floor, 9/1, R.N. Mukherjee Road, Kolkata - 700 001

ATTENDANCE SLIP

(TO BE SIGNED AND HANDED OVER AT THE ENTRANCE OF THE MEETING HALL)

I/We hereby record my / our presence at the ANNUAL GENERAL MEETING of the above named Company at KALA KUNJ, 48, Shakespeare Sarani, Kolkata - 700 017 at 11.00 a.m. on Thursday, the 1st July, 2010.

NAME(S) OF THE MEMBER (S) Registered Folio No. :DP-ID No :CI-ID No. :

Name of Proxy (in block letter) (To be fi lled in if the Proxy attends instead of the Member)

Member's / Proxy's Signature

Note: The copy of the Annual Report may please be brought to the Meeting Hall.

KESORAM INDUSTRIES LIMITEDRegd. Offi ce: 8th Floor, 9/1, R.N. Mukherjee Road, Kolkata - 700 001

PROXY FORM

Registered Folio No. . .............................................................. DP-ID No. .................................................. Client ID No. ......................

I/We ..........................................................................................................................................................................................................

of...............................................................................................................................................................................................................

being a member / members of the above named Company, hereby appoint ..........................................................................................

.............................................................................. of ...............................................................................................................................

or failing him ............................................................................................................................................................................................

of...............................................................................................................................................................................................................

as my / our proxy to attend and vote for me / us on my / our behalf at the ANNUAL GENERAL MEETING of the Company to be held at 11.00 a.m. on Thursday 1st July, 2010 and at any adjournment thereof.

As WITNESS my / our hand(s) this ...................................................................day of ................................................................2010

Signed ............................................................................................................. .......................................................................

Note : Proxy Form duly completed must reach the Company's Registered Offi ce not less than 48 hours before the time for holding the Meeting.

RevenueStamp 15

Paise



BK

BIR

LA

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R O U P O F CO

MP

AN

IES

B K BIRLA GROUP OF COMPANIES

The Group Logo - As represented by the 21st Century Atlas

Atlas, the Titan - Collective StrengthAtlas,bearer of the heavens is synonymous with vast, all encompassing strength and is used to symbolise the Group’s own collective strength. It refl ects the combined qualities of astute and dynamic management while emphasising the Group’s tenacity, consisten-

cy, reliability and overall leadership.

The Sun - Enlightenment and GrowthThe Sun, as a source of infi nite energy and inspiration, is used here in conjunction with the Atlas head to represent the vitality and powerful presence of the Group - both in its

industrial prowess and its fi nancial, technological and intellectual skills.

The Earth Segments - Diversifi ed ActivitiesEach of the latitudes around the Titan represent various sections - industrial, agricultural, fi nancial and other activities of the Group. As with the infi nite variety of the world, so is

the strength of the Group, made up of its diverse activities.

The Globe - Global VisionThe Group’s global presence and vision is refl ected in the entirety of the Earth’s sphere.

The Base - Solid FoundationsThe strength of the entire edifi ce depends upon the strength of the foundation embed-

ded in the bedrock, represented here by the Group Name.

The Symmetry - The Resilience, Versatility, and StabilitySeen in its entirety, each of the elements -Atlas, the Sun, the Earth divisions, the Globe

and the Base, together sum up a well conceptualised and balanced conglomerate.

Strong Foundation Sustained Growth Proven Leadership

KESORAM INDUSTRIES LIMITED

ANNUAL REPORT &ACCOUNTS 2009-10

Meeting New Challenges Everyday!

website : www. kesocorp.com

KESORAM INDUSTRIES LIMITED - · PDF filewho have made what Kesoram is today and will be ... Messrs Price Waterhouse Share Transfer ... rst Annual General Meeting of KESORAM INDUSTRIES

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