12th ar audited

8/14/2019 12th AR Audited

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P a n k a j E x t r u s i o n s L t d. A n n u a l R e p o r t 2 0 0 8 0 9

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PANKAJ EXTRUSIONS LIMITED

BOARD OF DIRECTORSHarakhchand N. Shah - Chairman & Managing DirectorJayesh H. Shah

Hitesh H. ShahHiren H. ShahGunvanti H. ShahKamini J. Shah

COMPANY LAW ADVISORSMAS & AssociatesCompany SecretaryMinal ShahB1, Basement,AmarnathApartment,Akota, Vadodara

AUDITORSVinesh Mehta & Co.Chartered Accountants202, Amit Complex,Subhanpura Road,Vadodara

BANKERSState Bank of IndiaCorporation Bank

REGISTERED OFFICE

1/3, Himalaya Park,Ashram Road,Ahmedabad.

CORPORATE OFFICE301-302, Aadi, Nr. P F OfficeAkota Stadium Road,Vadodara 390 020

REGIONAL OFFICE532, Arun Chambers,Tardeo Road,

Mumbai 400 034

WORKS15/1/4, Rakholi,Silvassa Khanvel Road,UT of DNH 396 230

CONTACTSwww.pankaj.co.in


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INDEX Page No.

1. Notice 03 042. Directors Report 05 083. Report on Corporate Governance 09 094. Management Discussion and Analysi s 10 115. Secretarial Audit Report 12 126. Auditors Report 13 157. Balance Sheet 16 168. Profit & Loss Account 17 179. Cash Flow Statement 18 1810. Schedules 19 2111. Accounting Policies and Notes on Accounts 22 27


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NOTICE OF THE ANNUAL GENERAL MEETING

NOTICE is hereby given that the TWELETH ANNUAL GENERAL MEETING of the Members of the Company will beheld on Tuesday, the 28th July 2009 at 11:00 AM at Ahmedabad to transact the following business:

ORDINARY BUSINESS

1. To consider and adopt the Profit and Loss Account for the year ended 31stMarch, 2009 and the Balance Sheet as at that date andthe Reports of the Directors and Auditors thereon.

2. To appoint a Director in place of Shri Hiren H Shah, who retires by rotation and being eligible, offers himself for re-appointment.3. To appoint a Director in place of Smt. Gunvanti H. Shah, who retires by rotation and being eligible, offers herself for re-

appointment.

4. To appointAuditors of the Company to hold office from the conclusion of this Meeting until the conclusion of the nextAnnualGeneral Meeting and to authorize the Board of Directors to fix their remuneration.

For & on behalf ofthe Board of Directors

Vadodara Date: June 24, 2009 Chairman & Managing Director

NOTES:

1. AMEMBER ENTITLED TO ATTEND AND VOTEA T THEABOVEMEE TING IS ENTITLED TO APPOINT A PROXY TOATTENDAND VOTE INSTEAD OF HIMSELF AND A PROXY NEED NOT BEAMEMBER. PROXIES, IN ORDER TO BEVALIDMUST BE RECEIVED BY THE COMPANY NOT LESS THAN 48 HOURS BEFORE THEMEETING.

2. Shareholders desiring any information as regards the Accounts are requested to write to the Company at an early date so as to

enable the Management to keep the information ready.

3. Members who hold shares in physical form are requested to notify any change in their address to the Company.4. Re-appointment of Directors:

Brief particulars of the Directors of the Company proposed to be appointed or re-appointed at the ensuing Annual GeneralMeeting are furnished under the Corporate Governance Report.


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ANNEXURE TO THE NOTICE

ANNEXURE TO THE NOTICE

EXPLANATORY STATEMENT PURSUANT TO THEPROVISIONS OF SECTION 173(2) OF THE COMPANIES ACT, 1956

The details required in a Statement as per Clause 1(B) of Section II of Part II of Schedule XIII are as hereunder:

a) General Information: The Company is engaged in manufacture of aluminum extruded products at its factory located atSilvassa in Dadra & Nagar Haveli. The Company had commenced commercial operation in 1999 with one extrusion pressline of 1600 M T capacity. The Company installed a 2nd press line with 1600 M T capacity press in 2007. The Companypresently has two press lines.

The company achieved sales revenue of Rs 11639 Lacs as against Rs 11927 Lacs in the previous year. The operating loss forthe year was Rs. (471) Lacs as against profit of Rs. 515 Lacs in the previous year.

b) Information about the Appointee: Shri Harakhchand N Shah aged about 68 years is a commerce graduate and has beenassociated with aluminum industry for over 40 years. He is also the promoter of the Company and has been working asChairman and Managing Director of the Company since Inception. Considering the experience of Shri Harakhchand N Shahand the fact that he is associated with the company as Chairman and Managing Director for over 11 years the remunerationproposed to be paid to him is very reasonable.

c) Other Information: The Company is presently considering expansion of capacity by installing a 3rdExtrusion Press Line andventure into value added products like surface treatment and fabricated components. Upon the expanded capacity cominginto operation, the overheads will be distributed over a much larger capacity, thus significantly improving the profitabilityofthe Company.

The proposed expansion plan i s to double the Companys installed capacity from 7500 MT to 15000 MT per annum. Theproduction is expected to double from the current level over a period of 2 years. The profits are expected to increase morethan proportionately.


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DIRECTORS REPORT

To the Members,

We are happy to present our report on the business and operations of the Company for the year ended 31st March 2009.

Financial Results In Rs. Lacs, except per share data

Directors Responsibility StatementThe Board of Directors of the Company confirms:

i. that in the preparation of the annual accounts, the applicable accounting standards have been followed along with properexplanation relating to material departures;

ii. that the selected accounting policies were applied consistently and the directors made judgments and estimates that arereasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31, 2009 and ofthe profit or loss of the Company for the year ended on that date;

iii. that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with theprovisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraudand other irregularities;

iv. That the annual accounts have been prepared on a going concern basis.Auditors / Auditors ReportThe auditors, M/s. Vinesh Mehta & Co., Chartered Accountants, retire at the ensuingAnnual General Meeting and have confirmedtheir eligibility and willingness to accept office, if re-appointed.

Public DepositsThe Company did not invite or accept any deposit from the public under Section 58A of the Companies Act, 1956.

Particulars as per Section 217 of the Companies Act, 1956 The company had no employee of the category indicated under Section 217(2A ) of the Companies Act, 1956. The additionalinformation on conservation of energy, technology absorption, foreign exchange earnings and outgo as required to be disclosed interms of Section 217(1) (e) of the CompaniesAct, 1956 is set out in a separate statement, attached to this report.

Year ended March 31 2009 2008

Sales 11638 11927

Profit/(Loss)before Interest, Depreciation and Impairment ofAssets (471) 515

Interest 162 94

Profit/(Loss) before Depreciation (633) 421

Depreciation and Impairment ofAssets 243 210

Net Profit / (Loss) (876) 211

Provision for Taxation & Deferred Tax (322) 47

Profit/(Loss) after Tax (556) 163

Previous Year Adjustments - (2)

Profit/(Loss) brought forward 1005 844

Balance of Profit/(Loss) carried to Balance Sheet 450 1005


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Acknowledgment

On behalf of the directors and management of the company, we wish to thank all our shareholders, customers, bankers and businessassociates for their confidence and continued support to the company.

We also thank all our employees for their dedication and hard work, which in no small measure had contributed to the satisfactoryresults in the past year.

We look forward to the continued support of all share holders in the years ahead.




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ANNEXURE TO DIRECTORS REPORT

DISCLOSURE OF PARTICULARS WITH RESPECT TO CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTIONANDFOREIGN EXCHANGE EARNINGS AND OUTGO AS REQUIRED UNDER THE COMPANIES (DISCLOSURE OF

PARTICULARS IN THE BOARD OF DIRECTORS REPORT) RULES, 1988. A. CONSERVATION OF ENERGY:

a) Energy Conservation measures taken:The Company has formed a Strong Technical Department headed by the senior personnel to continuously monitorEnergy Consumption and execute Energy Conservation Schemes. Following effective measures are being taken foroverall technological up gradation of Plant & Machinery.

b) Additional investments and proposals, if any, being implemented for reduction of consumption of energy:Highly power intensive furnaces are converted and now operation on LPG resulting in lower electricity demand.

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

i) Installation of Turbo Charger on D G Set fixed in generator to save fuel.ii) Receptors and Heater fixed in oil fired Furnace to save fuel.

d) Natural light provide through FRP sheet in roof.

e) Total energy consumption and energy consumption per unit of production:-

Information is given in prescribed Form-A annexed. The summary is given hereunder:

Furnace Oil Electrical EnergyLTR/M T KWH/MT

2008-2009 161 356

2007-2008 102 288

B. TECHNOLOGY ABSORPTION:Information is given in Form - B annexed.

C. FOREIGN EXCHANGE EARNINGS AND OUTGOi) Activities relating to exports: initiatives taken to increase exports, development of new export markets for products and

Services, and export plans.

ii) Total foreign exchange used and earned:Current Year Previous Year(Rs. in Lacs) (Rs. in Lacs)

Used 857.49 3804.02

Earned 1178.72 380.32


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FORM - ASee Rule 2

FORM FOR DISCLOSURE OF PARTICULARS WITH RESPECT TO CONSERVATION OF ENERGY

A. Power and Fuel Consumption

Current Year2008-09

Previous Year2007-08

1 Electricity(a) Purchased

Units - KWH in thousands 2387 2806Total amount Rs. in thousands 8932 8646Average Rate (Rs./KWH) 3.74 3.08

(b) Own generation through Diesel GeneratorTotal Liters of Diesel in thousand 58 94Diesel cost - Rs. In thousand 1739 2671Average Rate (Rs./Liter) 29.98 28.42

2 Coal (consumed in metal recovery unit)

Quantity in M. Ton --- ---Total cost (Rs. in thousands) --- ---Average Rate (Rs/MT) --- ---

3 Furnace OilQty. in Kilo Liters in thousand 597 994Total cost (Rs. in thousands) 15773 22986Average Rate (Rs/Liter) 26.42 23.12

B. Consumption per unit of productionElectricity (KWH/MT) 382 288Coal (Kg/MT) --- ---Furnace Oil (Liter / MT) 161 102

FORM - B

(See Rule 2)

FORM FOR DISCLOSURE OF PARTICULARS WITH RESPECT TO ABSORPTION

A. RESEARCH AND DEVELOPMENT (R&D)1. Specific areas in which R&D carried out by the Company: None2. Benefits derived as a result of the above R&D: None3. Future plan of action: None4. Expenditure on R&D: Not Significant (Previous Year - Not Significant)

B. TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATIONEfforts in brief made towards technology, absorption, adoption, and innovation: The company has been putting emphasis to train personnel by the way of providing training to them for the latesttechnology available.

Benefits derived as a result of the above efforts:It has resulted in a better quality of product besides improving the productivity and reducing the wastage.Information regarding technology imported during the last five years: N. A.




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REPORT ON CORPORATE GOVERNANCE

In compliance with, the Company submits the report on the matters mentioned in the said clause and on the practices as followed bythe Company:

Companys Governance PhilosophyThe Company has applied the principles of good Corporate Governance commensurate with its size.

Board of DirectorsThe Board of Directors comprises a Chairman and Managing Director, 3 executive Directors, 2 non-executive Directors, who retainresponsibility for the formulation of corporate strategy, the monitoring of financial and non financial performance, approval of majortransactions, financial statements, capital expenditure and treasury policy.

The board meets regularly and has a schedule of matters specifically referred to its decision.

Internal ControlsThe directors have overal l responsibili ty for ensuring that the company maintains a system of internal control to provide them withreasonable assurance regarding effective and efficient operations, internal financial control and compliance with laws and regulations. The risk management process and systems of internal control are designed to manage rather than eliminate the risks of failure to

achieve the companys strategic objectives. The company has reviewed the operation and effectiveness of the system of internal controlin operation during the year.

The composition of the Board of Directors during the year is as follows:

Name of the Director Designation Audit Committee Remunerationcommittee

Mr. H. N. Shah Chairman & Managing Director YesMr. Jayesh H. Shah Director Executive NoMr. Hitesh H. Shah Director - Manufacturing NoMr. Hiren H. Shah Director - Sales & Marketing NoMrs. Gunvanti H. Shah Director - Non Executive YesMrs. KaminiJ. Shah Director - Non Executive Yes

Shareholder Information:

Annual General Meeting:Date : July 28, 2009 Time : 11:00AMVenue : 1/3, Himalaya Park, Near New RBI,Ashram Road, Ahmedabad 380 014.


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MANAGEMENT DISCUSSION AND ANALYSIS REPORT

There has been a dramatic change in the economic scenario over last one year with irrational exuberance giving way to extremepessimism, which fortunately has now turned to a sense of renewed hope. From a situation of record levels of growth world-wide,most of the economies are presently showing only nominal growth and some others have even slumped into recession and de-growth.

The Indian economy could not remain completely insulated from this severe economic meltdown world-wide, initially triggered bysub-prime crisis in USA. The rapid outflow of institutional funds caused a sudden liquidity crisis, which almost brought the entireeconomy to a halt in the quarter October to December 2008.

In order to overcome this situation, first, the Reserve Bank of India came out with various monetary measures to boost l iquidity.Subsequently, the Govt. of India announced various fiscal stimulus measures including an across the board cut in Cenvat rates,increased investment in infrastructure projects and targeted support for key sectors like automobile, construction, etc. These measuresdid have desired positive impact on the Indian economy. Further, the Indian economy is driven more by domestic consumption andtherefore, the impact of global economic meltdown has been relatively muted.

The Aluminium Extrusions industry in India is mainly dependent on the domestic demand. The commodity prices worldwide wereextremely buoyant till July, 2008, and fell sharply thereafter. The aluminium metal prices also rose and fell with the rise and fall incommodity prices. During the 3rd quarter of the year, there was almost a panic like situation. Your company also faced some shortage

of orders in November and December08. However, the situation reversed completely in the last quarter as the fiscal stimulusmeasures, specially the cut in Cenvat rates, coupled with low aluminium metal prices restored the confidence and there was suddensurge in demand. The demand surge fortunately has continued in the first two months of current year as evidenced till writing of thisreport.

The demand-supply situation for aluminium extruded products in India is evenly balanced. Some new projects for manufacture ofaluminium extrusions are already in the pipeline and will commence production during the year 2009-10.

At the same time, the economic meltdown has meant that quite a few projects on drawing board stage have been put off and no newprojects would have been conceived over last year or so. This would mean that the demand-supply scenario will continue to remainevenly matched even if the Indian economy grows at somewhat lower growth rate in the year 2009-10.

If and when the growth rate picks up, the Aluminium Extrusions industry should see significantly more favourable days.

Industry Structure The aluminum extrusions industry in India constitutes of two segments PrimaryMetal Producers and Secondary ExtrusionManufacturers. The primary producers produce alumina, aluminium metal and also the further value added products such as rolledproducts, extrusions etc. There are four primary aluminium metal producers in India, viz. National Aluminium Co. Ltd. (NALCO),Hindalco Industries Ltd. (HINDALCO), BharatAluminium Co. Ltd. (BALCO) and Madras Aluminum Co. Ltd. (MALCO). Of theprimary aluminium metal producers, only HINDALCO manufacturesAluminum Extrusions.

The SecondaryAluminum Extrusion Manufacturers buy aluminium metal from primary producers or alternatively import metal andmanufacture extrusions. Your Company is one of the leading secondary aluminium extrusion manufacturers in the country.

The metal has application advantages given its high strength to weight ratio. The metal is completely recyclable and thus mostenvironment friendly. With advancement of technology, aluminium extrusions / profiles are finding newer applications and have avery promising future.

Aluminum extruded products are used in architectural applications such as profiles for Building Systems, Structural Glazing, Curtain

Walls, Aluminum Rolling Shutters, Windows, Doors, Partitions, False Ceiling, Tower Bolts, Door Handles, Drapery Rods etc., Profilesfor manufacture of automobile components, Profiles for Heat Sinks for heat transfer in electronic and electrical equipments, Profilesfor transport sections, irrigation tubes, Profiles for Electrical applications such as Tubes and Flats for Bus Bars, P. G. Clamps, RepairSleeves, Ferrules, etc., profiles for Engineering applications such as Motor Housings, Pump Casings, Ferrules etc., profiles for RailCoach Windows and doors, profiles for various defense applications and many more.

The Indian aluminium extrusion market can be divided into two segments, viz. End-use Customer Segment and Trade Segment. Thetrade segment mainly deals in profiles used for Architectural, Transport and standard applications. The price realization in the End-usecustomer segment is stable, but i s volatile in the trade segment.


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The Construction sector is doing very well with many new areas of construction coming up like retail chains, shopping malls,Information Technology parks and other commercial property developments with very high consumption ofAluminum Extrusions.The Architectural segment accounts for nearly 50% of the entire consumption of extrusions in India Until not very long ago, thebuilding construction industry had been unorganized and fragmented and there had been some indifference towards quality ofextrusions used in construction. However, with entry of large and reputed property developers with focus on quality, firstly thedemand from the architectural segment is growing and is expected to continue growing at double digit growth rate and secondly, thequality extrusions manufacturers like your company would have a good valuation.

OperationsThe current economic slowdown has adversely impacted the demand for extrusions from large IT and other commercial buildingprojects, which is a major customer segment.

The company has been focusing on supplies to end use customers, where the competition is by merits of plants and the margins arebetter. The proportion of our supplies to End-use Customers has continuously increased over last few years and currently stands at95%. The company has excellent order book position with satisfactory plant utilization.

Sales revenue decreased to Rs. 11638 Lacs from Rs.11927 Lacs in the previous year. The operating loss for the year was at Rs. 471 Lacsas against profit at Rs. 515 Lacs in the previous year.

In coming years, The Company proposes to invest on its own or in joint venture for in increasing its installed Extrusion capacity,

captive Billet plant, surface treatment plant, fabrication shop, development in value addedproducts. The Company expects to bring theenhanced capacity in operation before end of the financial year 201011.

Risks and Areas of ConcernWe have been operating at almost full capacity util ization with the available infrastructure for past three years. The production andsales could not grow due to limitation of available raw material. The recent expansion has addressed the issue to certain extent.However, as the fixed costs are continuously increasing, we need to quickly expand further our capacity and simultaneously ventureinto value added products to maintain and to improve our profitability.

We could not consider making capital investment over last few years in value added products due to limitation on our available land.The scenario has now significantly improved with purchase of additional land. Company intends to make sizeable capital investment toexpand its capacity and to install modern equipment to improve its efficiencies and margins.

Outlook

The market for extrusions in India has shown a good growth over last three years, and is continuing to grow at a robust pace. Weexpect the growth to continue at very good rate in coming years. The demand supply scenario in the country is evenly matched atpresent in small to medium size profile segment, while there is short supply for large size profiles especially for tall buildings, shipyards,telecommunication etc. We foresee a good growth in demand for extruded products in all the segments over coming years.

There are a number of attractive opportunities for developing further value-added products of extrusions. Some of the identified areaswhere we propose to venture in future are putting up an anodizing and powder coating facility, venturing into door and windowssystems segment and putting up a facility for making engineering components. These would require some capital investment andwould be considered in due course.

Cautionary StatementStatements forming part of the Management Discussion and Analysis covered in this report may be forward-looking within themeaning of applicable securities laws and regulations. Actual results may differ materially from those expressed in the statement.


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SECRETARIAL AUDIT REPORT

ToThe Members ofPankaj Extrusions Limited

Your company appointed Ms. Minal Shah, practicing Company Secretary, to conduct secretarial audit of the company for the financialyear ended on 31stMarch 2009. The secretarial audit report addressed to the board of the directors of the company is attached to thisannual report. The attached secretarial audit report confirms that the company has complied with all applicable provision ofCompanies Act, 1956.

For PANKAJ EXTRUSIONS LTD

Vadodara Harakhchand N ShahDate: June 24, 2009 Chairman & Managing Director


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AUDITORS REPORT

To The Members,

We have audited the attached Balance Sheet ofPANKAJ EXTRUSIONS LIMITED as at 31st March, 2009 and also the Profit &

Loss Account and the Cash Flow Statement for the year ended on that date annexed thereto. These financial statements are theresponsibility of the Companys management. Our responsibil ity is to express an opinion on these financial statements based on ouraudit.

We conducted our audit in accordance with auditing standard generally accepted in India. These Standards require that we plan andperform the audit to obtain reasonable assurance whether the Financial Statements are prepared free of material misstatement. Anaudit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit alsoincludes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overallpresentation of financial statements. We believe that our audit provides a reasonable basis for our opinion.

1. As required by the Companies (Auditors Report) Order 2003, issued by the Company Law Board in terms of Section 227(4A) ofthe Companies Act, 1956 we give in the Annexure a statement on the matters specified in paragraph 4 and 5 of the said Order, tothe extent applicable to the Company.

2.

Further to our comments in the Annexure referred to in paragraph 1 above, we report that:

2.1.We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary forthe purpose of our audit.

2.2. In our opinion, proper books of account as required by law have been kept by the Company so far as appears from ourexamination of these books

2.3.The Balance Sheet, Profit & Loss Account and Cash Flow Statement dealt with by this report are in agreement with thebooks of the account.

2.4. In our opinion, the Balance Sheet, Profit & Loss Account and Cash Flow Statement dealt with by this report complywith the Accounting Standard referred to in Sub-section (3C) of Section 211 of the Companies Act, 1956, to the extentapplicable.

2.5. On the basis of written representations received from the directors, as on 31 st March, 2009 and taken on record by theBoard of Directors, we report that none of the director is disqualified as on 31stMarch, 2009 from being appointed asDirector in terms of section 274(1)(g) of the CompaniesAct, 1956.

2.6. In our opinion and to the best of our information and according to explanations given to us the said account, give theinformation required by the Companies Act, 1956 in the manner so required and read together with other notes giventhereon, gives a true and fair view in conformity with the accounting principles generally accepted in India:

(1) in the case of the Balance Sheet of the state of the Companys affairs as at 31stMarch, 2009;(2) in the case of Profit & Loss Account of the Profit for the year ended on that date; and(3) in the case of the Cash Flow Statement, of the cash flow for the year ended on that date.

For VINESH MEHTA & CO.

Chartered Accountants

Vadodara (Vinesh Mehta)Date: June 24, 2009 Proprietor

Membership No. 49554


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ANNEXURE TO THE AUDITORS REPORT(Referred to in paragraph 1 of our report of even date)

1.a. The Company has maintained proper records showing full particulars including quantitative details and situation offixed

assets.

b. The management has physically verified its fixed assets at reasonable intervals, which in our opinion is reasonable havingregard to the size of the Company and nature of i ts fixed assets. No material discrepancies were noticed on such verification.

c. In our opinion, the Company has not disposed off the substantial part of fixed assets during the year, which wouldaffect thegoing concern status of the Company.

2.a. The inventories have been physically verified by the management during the year at reasonable intervals.b. In our opinion and according to the information and explanations given to us, the procedures of physical verification

followed by the management are reasonable and adequate in relation to the size of the Company and nature of its business.

c. The Company has maintained proper records of inventories and discrepancies noticed on physical verification were notmaterial.3.

a. The company has not granted any loans, secured or unsecured to companies, firms or other parties listed in the Registermaintained under Section 301 of the CompaniesAct, 1956. As the company has not granted any loans secured or unsecured,to parties listed in the Register maintained under Section 301 of the Companies Act, 1956, paragraphs (iii)(b), (c) and (d) ofthe Order, are not applicable.

b. The company has taken unsecured loan from two (2) parties covered in the register maintained under Section 301 of theCompanies Act, 1956. The aggregate loan taken during the year and the yearend balance of such loan aggregating to Rs.4,07,59,991.00 and Rs. 6,42,30,000.00 respectively.

4. In our opinion and according to the information and explanations given to us, there are adequate internal controlprocedures commensurate with the size of the Company and nature of its business for the purchase of inventory and fixedassets and for the sale of goods and services. During the course of our audit, we have not observed any major weakness ininternal controls.

5.a. According to the information and explanations given to us and audit in accordance with generally accepted auditing

practices, in our opinion, the particulars of contracts or arrangements referred to in section 301 of the Act have beenentered 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 ofsuchcontracts or arrangements have been made at prices which are reasonable having regard to the prevailing market prices atthe relevant time.

6. During the year, the Company has not accepted any deposits from the public as defined under sections 58A and 58AA or anyother relevant provisions of the CompaniesAct, 1956 and the rules framed there under.

7. In our opinion the Company has an internal audit system commensurate with the size and nature of i ts business.8. The Company has maintained the cost records as prescribed by the Central Government under section 209(1)(d) of the Act.9. According to the records of the Company, the Company is regular in depositing undisputed statutory dues includingProvident

Fund, Income Tax, Sales Tax, Service Tax, Custom Duty, Excise Duty, Cess and any other statutory dues applicable to it.


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According to information and explanations given to us

a. Employees State Insurance Act is not applicable to the Employees of the Company.b. The disputed statutory dues aggregating to Rs. 2.09 Crores, that has not been deposited on account of disputed

matter pending before the appropriate authority is as under:

Particular Period to which theamount relates

Forum where matter ispending

Amount(in Crores)

Excise Duty 1999-2003 Appellate Tribunal Rs. 2.09

10. The company has neither accumulated losses at the end of financial year nor it has incurred cash losses during the financial yearunder review and in immediately preceding financial year.

11. According to the information and explanations given to us and audit in accordance with generally accepted auditing practices, inour opinion, the company has not defaulted in repayments of dues to financial institutions or banks or debenture holders.

12. According to the information and explanations given to us and based on the documents and records produced before us, theCompany has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

13. In our opinion and according to information and explanations given to us, the Company is not a chit fund or nidhi/ mutualbenefit fund or society. Therefore clause 4(xiii ) of the order is not applicable to the Company.

14. In our opinion and according to information and explanations given to us, the Company is not dealing in shares, securities,debentures and other investments and therefore clause (xiv) of the Order is not applicable to the Company.

15. According to the information and explanations given to us, the Company has not given any guarantee for loans taken by othersfrom bank or financial institutions.

16. To the best of our knowledge and belief and according to the information and explanations given to us, in our opinion,term loansavailed by the Company were, prima facie, applied by the Company during the year for the purposes for which the loans wereobtained, other than temporary deployment pending application.

17. According to the information and explanations given to us and on an overall examination of the Balance Sheet ofthe Company,funds raised on short-term basis have, prima facie, not been used during the year for long term investment.

18. During the year, the Company has not made any preferential allotment of shares to parties covered in the register maintainedunder section 301 of the Act.

19. During the year, the Company has neither issued any debentures nor does it have any outstanding debentures.20.The company has not raised any money by way of public issued during the year.21. In our opinion and according to information and explanations given to us, during the year, no fraud on or by the Company has

been noticed or reported.

For VINESH MEHTA & CO.Chartered Accountants

Vadodara (Vinesh Mehta)Date: June 24, 2009 Proprietor

Membership No. 49554


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BALANCE SHEETAs at 31st March

Schedule 2009 2008

SOURCES OF FUNDSShareholders FundShare CapitalShare Application Money (Pending for Allotment)

1 9,00,00,000.003,75,00,000.00

9,00,00,000.003,75,00,000.00

Reserve & Surplus 2 8,04,75,000.87 13,81,71,290.70

Loan FundsSecured Loans Term Loan

- Working Capital3 30,10,84,035.83

11,99,73,994.0218,01,62,587.7210,79,05,014.10

Unsecured LoansDeferred Tax Liability

4 13,81,58,998.421,40,01,344.02

12,70,67,863.714,62,39,553.65

Total 78,11,93,373.16 72,70,46,309.88

APPLICATION OF FUNDS

FixedAssetsGross Block 5 50,01,62,264.12 48,57,29,273.44Less : Depreciation 12,00,75,033.51 9,57,77,755.06Net Block 38,00,87,230.61 38,99,51,518.38

Investment 6 2,38,97,534.00 2,60,84,886.00

Foreign CurrencyMonetary Item Transaction Difference A/c

CurrentAssets, Loans &Advances

55,33,012.30 0.00

Inventories 7 11,73,11,716.00 21,70,51,481.00Sundry Debtors 8 24,90,49,657.09 16,66,21,709.29Cash & Bank Balances 9 85,73,703.00 32,19,949.87

Loans &Advances 10 11,75,04,592.81 6,72,68,110.27

Less : Current Liabilities & Provisions49,24,39,668.90 45,41,61,250.43

Current Liabilities 11 15,05,33,852.20 17,29,50,899.48Net CurrentAssets

Pre-Operative ExpenditureMiscellaneous Expenditure 12

34,19,05,816.70

2,93,32,319.554,37,460.00

28,12,10,350.95

2,93,32,319.554,67,235.00

Total 78,11,93,373.16 72,70,46,309.88

Accounting Policies and Notes on Accounts 13The Schedules referred to above form part of the Accounts

As per our report of even date attached Harakhchand N Shah Jayesh ShahFor VINESH MEHTA & CO. Chairman & Managing Director Hitesh ShahChartered Accountants Hiren Shah

Minal Shah DirectorsCompany Secretary

Vinesh MehtaProprietorMembership No. 49554 H N Shah J H Shah

Director DirectorVadodaraDate: June 24, 2009


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PROFIT & LOSS ACCOUNTFor the year ended 31st March

INCOME

Schedule 2009 2008

Sales and Other Operating Income 14 11,63,876,018.05 1,19,27,13,181.34Less : Excise Duty 4,66,07,798.00 8,62,15,618.85Net Sales 1,11,72,68,220.05 1,10,64,97,562.49Increase / (Decrease) in Stock 15 (2,77,58,521.00) 1,41,26,676.00

Total 1,08,95,09,699.05 1,12,06,24,238.49

EXPENDITURECost ofMaterials Consumed 16 97,16,50,937.57 94,17,55,312.54Manufacturing, Selling &Administrative Expenses 17 16,49,93,480.85 12,73,12,701.51Interest 1,61,79,290.94 94,46,884.00Depreciation 2,42,97,278.45 2,10,32,296.28

Total 1,17,71,20,987.81 1,09,95,47,194.33

PROFIT BEFORE TAX (8,76,11,288.76) 2,10,77,044.16

Provision for Taxation:Fringe Benefit Tax 1,94,121.00 2,39,086.95Income Tax 0.00 22,55,235.17Deferred Taxes (3,22,38,209.63) 22,41,966.51

PROFIT AFTER TAX (5,55,67,200.13) 1,63,40,755.53PROFIT/(LOSS) BROUGHT FORWARD 10,05,44,701.00 8,44,03,822.47ADD (LESS) PRIOR PERIOD ITEM

BALANCE IN PROFIT AND LOSS ACCOUNT

0.00

4,49,77,500.87

(1,99,887.00)

10,05,44,701.00

Basic and Diluted Earnings Per Share Rs. (6.17) 1.81Face Value ofEquity Share Rs. 10.00 10.00

Accounting Policies and Notes on Accounts 13The Schedules referred to above form part of the Accounts

As per our report of even date attached Harakhchand N Shah Jayesh ShahFor VINESH MEHTA & CO. Chairman & Managing Director Hitesh ShahChartered Accountants Hiren Shah

Directors

Vinesh Mehta Minal ShahProprietor Company SecretaryMembership No. 49554

H N Shah J H ShahDirector Director

VadodaraDate: June 24, 2009


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CASH FLOW STATEMENTFor the year ended 31st March2009 2008

A CASH FLOW FROM OPERATING ACTIVITIESNet Profit before tax and extraordinary items: (8,76,11,288.76) 2,10,77,044.16Adjustment :-

for Deferred revenue expenditure written off 1,21,573.00 1,16,809.00for Depreciation on fixed assets 2,42,97,278.45 2,10,32,296.28for Exchange Fluctuation ---- ----for Provision for Taxation ---- ----

(Profit)/Loss on sale of fixed assets ---- ----Interest Paid 1,61,79,290.94 94,46,884.00Less : Interest Received ---- ----Operating Profit before working capital changes (4,70,13,146.37) 5,16,73,033.44Adjustment for : Trade and other receivables 8,24,27,947.80 7,50,01,623.40

Inventories (9,97,39,765.00) 3,43,85,267.00 Trade payables (1,02,39,678.24) Other Loans & Advances 5,02,36,482.54 1,25,63,704.71

Cash generated from operations (2,26,84,987.10) 26,18,19,192.46Prior Period Adjustment ---- (1,99,887.00)

Tax Paid (Including advance tax & TDS) 1,88,796.00 (21,29,862.34)Net cash from operating activities (2,41,39,363.27) 25,94,89,443.12

B CASH FLOW FROM INVESTING ACTIVITIESPurchase of fixed assets (1,44,32,990.68) (5,58,58,479.59)Deferred Tax (1,40,01,344.02) (4,62,39,553.65)Deferred Tax Revenue Expenditure (5,59,033.00) (5,84,044.00)Net cash used in investing activities (2,89,93,367.70) (10,26,82,077.24)

C CASH FLOW FROM FINANCIAL ACTIVITIESExchange(Loss)/Gain on account of repayment of LoanRepayment of Long term borrowing

(21,29,089.70)12,09,21,448.11

----3,23,19,631.03

Proceeds for issue of share capital 3,75,00,000.00 3,75,00,000.00Proceeds (Repayment) of unsecured loan 11,0,91,134.71 74,69,245.13Interest paid (16,179,290.94) (94,46,884.00)Net cash used in financing activities 15,12,04,202.18 6,78,41,992.16

NET INCREASE IN CASH AND CASH EQUIVALENTS (A+B+C) 9,80,71,471.21 22,46,49,358.04Cash and cash equivalents opening balance:Cash and bank balance 9,11,97,033.17 2,44,01,910.31Cash and cash equivalents closing balance:Cash and bank balance 18,92,68,504.38 24,90,51,268.35

The Schedules referred to above form part of the Accounts

As per our report of even date attached Harakhchand N Shah Jayesh Shah

For VINESH MEHTA & CO. Chairman & Managing Director Hitesh ShahChartered Accountants Hiren ShahDirectors


H N Shah J H ShahDirector Director

VadodaraDate: June 24, 2009


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SCHEDULESAsAt 31st March

2009 20081 Share Capital

Authorized

90,00,000 Equity Shares of Rs.10/- each 9,00,00,000.00 9,00,00,000.00Total 9,00,00,000.00 9,00,00,000.00

Issued Subscribed & Paid-up90,00,000 Equity Shares of Rs. 10/- each 9,00,00,000.00 9,00,00,000.00

Total 9,00,00,000.00 9,00,00,000.00

2 Reserve &SurplusShare Premium Account 3,54,97,500.00 3,54,97,500.00Foreign Exchange Fluctuation Reserve 0.00 21,29,089.70Profit & Loss Account 4,49,77,500.87 10,05,44,701.00

Total 8,04,75,000.87 13,81,71,290.70

3 Secured LoanTerm Loan from Bank : Foreign Currency Loan

: Rupee LoanAuto hire Purchase Vehicles

12,35,36,310.85

17,71,77,142.233,70,582.75

13,64,99,631.00

4,29,76,790.426,86,166.30

Working Capital Loan : Foreign Currency Loan: Rupee Loan

6,32,79,583.005,66,94,411.02

1,77,05,033.699,01,99,980.41

Total 42,10,58,029.85 28,80,67,601.82

4 Unsecured LoanFrom Directors 1,77,58,975.42 33,872.71From Inter-corporate Group Loans

In Indian Rupees 7,96,40,032.00 11,00,00,000.00In Foreign Currency 4,07,59,991.00 1,70,33,991.00

Total 13,81,58,998.42 12,70,67,863.71

5 FixedAssets

Description ofAssets

Gross Block as at Depreciation Net Block as at

01.04.08 Addition Deduction 31.03.09 01.04.08 Provided Deduction 31.03.09 31.03.09 31.03.08

Land 6265000 .00 3770000.00 ---- 10035000.00 ---- ---- ---- ---- 10035000.00 6265000.00

Building 71878784.55 --- ---- 71878784.55 13033643.60 2214608.87 ---- 15248252.47 56630532.08 58845140.95

Plant andMachinery

Imported 293691343.60 971186.48 ---- 294662530.08 41047745.48 15552536.72 ---- 56600282.20 238062247.88 252643598.12

Indigenous 92869411.89 9472348.20 ---- 102341760.09 34353399.96 4955916.18 ---- 39309316.14 63032443.95 58516011.93

Electrical Installat ions 11412671.15 ---- ---- 11412671.15 3390372.86 602589.04 ---- 3992961 .90 7419709.25 8022298 .29

Vehicles 5090746 .98 --- ---- 5090746.98 1745811.37 483620.96 ---- 222943 2.33 2861314.65 3344935

Office Equipments 927234.78 98390.00 ---- 1025624.78 273045.13 63354.39 ---- 336399.52 689225.26 654189.65

Furniture & fixtures 1713246 .99 --- ---- 1713246.99 673175.40 108448.53 ---- 781623.93 931623.06 1040071 .59

Computers & Printers 1880833.50 121066.00 ---- 2001899.50 1260561.26 316203.76 ---- 1576765.02 425134.48 620272.24

Total 485729273.44 14432990.68 ---- 500162264.12 95777755.06 24297278.45 ---- 120075033.51 380087230.61 389951518.38

Previous Year figure 319403415.44 207051274.62 40725416.62 485729273.44 74745458.78 21032296.28 ---- 95777755.06 389951518.38 244657956.66


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SCHEDULES

As at 31st March2009 2008

6 Investment (Unquoted)327988 of Ordinary Shares of 1 each fully paid up 2,38,97,534.00 2,60,84,886.00In Overseas Joint Venture Registered Company(Face Value 327988 covered to Rs. 276.70 Lacs)

Total 2,38,97,534.00 2,60,84,886.00

7. Inventories(as taken, valued and certified by the Management)RawMaterials 1,78,314.00 12,52,80,077.00Work-in-Progress 0.00 2,52,13,718.00Finished Goods 20,89,797.00 46,34,600.00Stores, Spare, & Dies 11,50,43,605.00 6,19,23,086.00

Total 11,73,11,716.00 21,70,51,481.00

8. Sundry Debtors

Debts outstanding for a period exceeding six monthsDomestic

3,05,86,681.179,83,55,802.88

2,35,51,029.0011,65,77,683.29

Export 12,01,07,173.04 2,64,92,997.00Total 24,90,49,657.09 16,66,21,709.29

9. Cash & Bank BalancesCash on hand 27,85,307.66 32,98,452..64Bank Balance 57,88,395.34 (78,502.77)

Total 85,73,703.00 32,19,949.87

10. Loans , Advances & DepositsAdvance Recoverable in cash or in kind or fro value to received 4,63,30,086.25 5,64,458.00Prepaid ExpensesBalance With GovernmentAuthority

3,08,877.00 7,12,482.00

Excise Duty

Service TaxTax Deducted at SourceVAT

Other DepositsDeposits for Office premises

6,11,78,790.00

8,06,072.016,74,364.55

48,47,710.004,84,192.00

28,74,500.00

5,59,69,424.74

7,19,175.530.00

59,99,401.004,06,668.00

28,96,500.00

Total 11,75,04,592.81 6,72,68,110.27

11. Current Liabilities & ProvisionsA. Current Liabilities

Sundry CreditorsOther Current liabili ties & Statutory dues

B. Provision forRetiring Leaves & GratuitiesFringe Benefit Tax (Net ofAdvance Payment of Rs.188796.00)

Income Tax (Net ofAdvance Tax of Rs. NIL andTDS/TCS of Rs.633921.55)

14,64,07,726.2032,38,827.00

8,81,974.005,325.00

0.00

16,90,24,760.1928,83,403.17

9,29,022.0036,923.95

76,790.17

Total 15,05,33,852.20 17,29,50,899.48

12. Miscellaneous ExpenditureDeferred revenue ExpenditureOpening BalanceAdd : During the yearLess : 1/5th Written Off

4,67,235.0091,798.00

1,21,573.00

5,44,044.0040,000.00

1,16,809.00Total 4,37,460.00 4,67,235.00


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14. SalesDomestic 99,93,95,955.18 106,84,65,234.98Export 11,78,72,264.87 3,80,32,327.51

1,11,72,68,220.05 1,10,64,97,562.49

15. Increase / (Decrease) inStockClosing Stock Work in Progress 0.00 Finished Goods 20,89,797.00 46,34,600.00

Total 20,89,797.00 2,98,48,318.00Opening Stock Work in Progress 2,52,13,718.00 Finished Goods 46,34,600.00 94,10,991.00

Total 2,98,48,318.00 1,57,21,642.00

Increase / (Decrease) in Stock (2,77,58,521.00) 1,41,26,676.00

16. Raw Material ConsumedOpening StockAdd : Purchase during the year

ImportedDetention/ Ground Rent ChargesIndigenous

Less : Closing Stock

12,52,80,077.00

8,82,82,201.691,05,34,501.00

74,77,32,471.881,78,314.00

6,80,82,078.00

65,11,38,877.030.00

34,78,14,434.5112,52,80,077.00

Total 97,16,50,937.57 94,17,55,312.54


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17. Manufacturing, Selling &Administrative Expenses

Manufacturing ExpensesConsumption of Stores, Spares & Foundry ChemicalsConsumption of Power & FuelsJob Work & FactoryExpenseRepairs and Maintenance Expenses

Payments to and Provision for EmployeesSalary, Wages, Ex Gratia, PF, & GratuitiesEmployees welfare & amenities

Administrative ExpensesTravelling & ConveyanceAuditors RemunerationDirectors RemunerationDirectors TravellingElectricityExpensesInsuranceExpenseRent, Rates & Taxes

Printing & StationaryPostage & TelephoneProfessional ExpenseVehicles ExpenseExchange Rate Fluctuation LossOther Administrative Expenses

Sales and Distribution ExpensesSales Promotion & Advertisement Exp.Freight OutwardSales CommissionBad and Doubtful debtsOverdue LC ExpenseOther Sales Expense

Financial ExpensesBank & Other Financial Charges

17,94,91,456.161,59,44,311.56

70,20,376.002,92,366.00

1,38,47,781.00244,074.00

3,84,073.501,05,281.00

24,00,000.002,24,691.003,21,956.326,94,552.00

13,46,556.00

3,56,719.7510,25,960.8022,07,892.005,91,200.24

4,44,06,595.4249,67,277.29

23,821.0015,65,955.001,30,883.003,82,394.14

0.005,36,657.47

4,84,80,650.20

1,74,70,855.433,77,26,923.30

60,94,761.0012,28,182.00

1,55,22,843.687,26,220.47

8,66,450.1374,719.00

22,80,000.001,94,465.104,22,762.778,98,625.00

10,47,021.32

4,01,123.0010,57,722.9729,20,140.002,82,671.00

(19,31,952.43)26,86,791.41

2,33,178.0012,23,139.001,28,507.00

(5,58,333.16)38,46,098.2685,80,505.33

2,38,89,281.93

Total 16,49,93,480.85 12,73,12,701.51


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NOTES ON ACCOUNTS13.Accounting Policies and Notes on Accounts

1. Accounting Policies

A Basis of Preparation of Financial Statements:The financial statements have been prepared under the historical cost convention in accordance with the generallyaccepted accounting principles in India and the provisions of the CompaniesAct, 1956.

B Use of Estimate: The preparation of financial statements requires estimates and assumptions to be made that affect the reportedamount of assets and liabilities on the date of financial statements and the reported amount of revenues andexpenses during the reporting period. Difference between the actual result and estimates are recognized in theperiod in which the results are known / materialized.

C Fixed Assets & Depreciation:(1) Fixed Assets are stated at cost net ofModvat / Cenvat, less accumulated depreciation, amortization and

Impairment loss, if any.(2) Line Method at rates prescribed under schedule XIV to the CompaniesAct, 1956.

(3) Free hold land, Leasehold Land and Site Development Expenses are not depreciated.

D Inventories:(1) Inventories are valued at the cost.(2) Work-in-progress and Finished goods include related manufacturing overheads and costs(3) Consumable Stores, spares & Dies include related manufacturing overheads and costs.

E Dies and Tools:Expenditure incurred on different heads for manufacture of dies and tools are charged to profit and loss account.The expenditure on dies manufactured for expansion is shown as Dies - in - process under inventory for stores andspare parts to be charged to profit and loss account as and when the dies would be used for production.

F Sales:Sales include sale value of goods, and are accounted net of sales returns, discount, rate difference, sales-tax, VAT.

G Inter-divisional Transfers:Inter-divisional transfers of goods between departments as captive consumption is shown as contra items in theProfit and Loss Account to reflect the true economic value of the production. Any unrealized profit on unsold stockis ignored while valuing inventories.

H Purchases:Pending receipt of final invoices, imported materials purchased are accounted on the basis of bill of lading / originalinvoice raised by the suppliers.

I Foreign Currency Transactions:Foreign Currency Transactions (FCT) are initially recognized at the spot rate on the date of thetransaction/contract. Monetary assets and liabilities relating to foreign currency transactions and forward exchangecontracts remaining unsettled at the end of the year are translated at year end rates.

The company has opted for accounting the exchange differences arising on reporting of long term foreign currencymonetary items in line with Companies (Accounting Standards) Amendment Rules 2009 relating to AccountingStandard 11 (AS-11) notified by Government of India on 31st March, 2009. Accordingly the effect of exchangedifferences on foreign currency loans of the company is accounted by addition or deduction to the cost of the assetsso far it relates to depreciable capital assets and in other cases by transfer to Foreign Currency Monetary ItemsTranslation Difference Account to be amortized over the balance period of the long term monetary items or 31stMarch, 2011 whichever is earlier.

The differences in translation of FCT (excluding the long term foreign currency monetary items accounted in line with Companies (Accounting Standards) Amendment Rules 2009 on Accounting Standard 11 notified by


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Government of India on 31st March, 2009) and realized gains and losses, other than those relating to fixed assets arerecognized in the Profit and LossAccount.

The company has opted for accounting the exchange differences arising on reporting of long term foreign currencymonetary items in line with Companies (Accounting Standards) Amendment Rules 2009 relating to AccountingStandard 11 (AS-11) notified by Government of India on 31st March, 2009.

As a result of this change in the accounting, the exchange difference of as on 31st March, 2009, Rs. 150.45 lacsremains to be amortized in the Foreign CurrencyMonetary Items Translation Difference Account after taking acharge of Rs. 20.98 lacs in the Profit & Loss Account. Accordingly the effect of exchange differences of Rs. 80.37lacs on foreign currency loans of the company is accounted by addition or deduction to the cost of the assets so farit relates to depreciable capital assets. Consequently the Depreciation for the year ended 31st March, 2009 is higherby Rs. 0.01 lacs and the Loss before taxes for the year ended 31stMarch, 2009 is reduced by Rs. 230.82 lacs.

I Investment:Long term unquoted investments (investment in Joint Venture Company) are carried at cost after adjustingexchange fluctuation in closing value of investment.

J Retirement Benefit:Companys contribution to retirement Provident Fund, Gratuity & Leave encashment is charged to Profit & Loss

Account for those employees who employed under Cost to Company basis.

K Taxation:(1) Deferred tax is accounted for by computing the tax effect of timing differences which arise during the year and

Reverse in subsequent period.(2) Income tax is accounted as per the provisions of the Income Tax Act.

L Borrowing Costs:Interest and other borrowing costs directly attributable to the acquisition, construction or installation of qualifyingcapital assets till the date of commercial use of the assets are capitalized. Other borrowing costs are recognized as anexpense in the period in which they are incurred.

N Miscellaneous Expenditure:Deferred revenue expenditure consists of expenditure of increase in capital and also ISO and web designing

expenditure which is written off over a period of five years.

2. Contingent Liabilities not provided in respect of:

A Bank Guarantees outstanding Rs 2.31 crore (previous year Rs. 2.92 crore) and Export Obligation of 1903.277 MT ispending. (Value is not ascertained)

B The disputed Excise duty demand for the year 1999-2003 is Rs. 2.09 crore (Net of 2.67 crore less deposit paid of Rs.0.58 crore) based on the stay order of the Appellant Tribunal and the interpretation of the other relevant provisions,the company has been legally advice that it has an arguable case on merits. Hence demand is likely to be deleted orsubstantially reduced.

3. Disclosure for Accounting Standard 22 Accounting for Tax on Income:

The Deferred tax as at 31STMarch 2009 Comprises of the following. 31.03.09 31.03.08

Deferred TaxRelated to Fixed Assets (a) 4,79,49,559.00 57,17,201.86

Deferred Tax AssetsMAT Credit under the I-Tax Act 22,25,125.00 22,25,125.00Past unabsorbed depreciation

Total (b)3,17,23,090.003,39,48,215.00

12,50,110.3534,75,235.35

Deferred Tax (a b) 1,40,01,343.00 22,41,966.51

4. The Term Loan and Working Capital Facilities are secured as follows:


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A Term Loan of Rs. 3007.13 Lacs from State Bank of India and Corporation Bank is secured by first mortgage on allthe immovable properties and a first charge by way of hypothecation of plant & machinery of the Company, bothpresent and future, situated at Companys factory at Silvassa in UT of DNH.

B Term Loans of Rs. 3.71 Lacs from HDFC Bank are secured by hypothecation of vehicles purchased

C Fund based working capital facilities of Rs. 1199.73 Lacs availed from State Bank of India and Corporation Bank aresecured -

(1) By first mortgage on all the immovable properties and a first charge by way of hypothecation of plant &Machinery of the Company, both present and future, si tuated at Companys factory at Silvassa in UT of DNH.

(2) By first charge by hypothecation of stocks, book debts and other current assets.(3) By personal guarantees of the al l Directors of the Company.

5. As per announcement in terms of Revenue, in Accounting Standard (AS) 9, Revenue Recognition, the recognition of inter-division transfer is an inappropriate accounting treatment and is inconsistent with Accounting Standard (As) 9. As result tothis, turnover (sales) and consumption of raw material of Rs. 35.96 crore respectively are overstated. However, this has noeffect in the result of the Company.

6. The company has opted for accounting the exchange differences arising on reporting of long term foreign currency monetaryitems in line with Companies (Accounting Standards) Amendment Rules 2009 relating to Accounting Standard 11 (AS-11)notified by Government of India on 31st March, 2009.

As a result of this change in the accounting, the exchange difference on long term monetary items as on 31st March, 2009, ofRs. 76.61 lacs remains to be amortized in the Foreign CurrencyMonetary Items Translation Difference Account and willbe amortized over the balance period of long term monetary items or 31st March, 2011 whichever is earlier. Moreover, theexchange difference of Rs. 80.37 lacs on foreign currency loan on purchased of fixed assets is added to the cost of the assets.Consequently to this, the Depreciation for the year ended 31st March, 2009 is higher by Rs. 0.01 lacs and the Loss beforetaxes for the year ended 31st March, 2009 is lower by Rs.156.98 lacs.

7. The sundry debtors includes Rs.98.77 lacs are considered as unrecoverable since long time and provision for bad debts isrequired to made. In the opinion of management, same are recoverable and hence no provision is required.

8. Loans and Advances include:

a. Rs 26.15 Lacs (previous year Rs.26.15) being security deposit for office premises made to a private limited company inwhich a relative of two of the directors is interested as a director.

b. The Advances of given to 16 (sixteen) parties of Rs. 4.39 crore is subject to confirmation. The same are considered asunsecured and unrecoverable since long time. In the opinion of management however, those are treated as goods,secured and recoverable.

9. Previous year figure are reworked, regrouped, rearranged and reclassified wherever necessary to correspond with figures ofthe current year.

10. In the opinion of the board of directors, the current assets, loans and advances have been valued on realization in theordinary course of business at least equal to the amount at which they are stated in the Balance Sheet.

11. All the debit and credit balances including sundry debtors and creditors are subject to confirmation from party.

12. There were no employees who were employed for a part of the year and were in receipt of remuneration in the aggregate therate of not less than Rs. 50,000.00 per month.

13. a. The total dues outstanding to Micro and Small Enterprises as defined in The Micro, Small and MediumEnterprisesDevelopmentAct, 2006, as at 31.3.2009, to the extent identified based on the available information, included underCurrent Liabilities is Rs NIL Lacs (Previous Year NIL Lacs). There are no dues to Micro and Small Enterprisesoutstanding exceeding Rs 1.00 Lacs and more than 30 days as on 31.3.2009.

b. None of the suppliers has informed the company of being registered under the Micro, Small and MediumEnterprises developmentAct 2006 and therefore there is no information for submission under the said Act.


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14. Licensed & Installed Capacity, Production, Stocks andTurnover:

2008-2009 2007-2008

Class of Goods - Aluminum Products, OthersMT Rs. Lacs MT Rs. Lacs

a) Licensed Capacity Delicensed Delicensedb) Installed Capacity (As certified byManagement) 12000 12000c) Production 6097 9753d) Opening Stocks 1230 2170.51 1026 1826.66

Closing Stocks 47 860.22 1230 2170.51e) Turnover 11638.76 11927.13

15. RawMaterial Consumed 6097 9673.17 9753 9417.55

16. Value of Imported and Indigenous Goods % Value % Valuepurchase and percentage thereof : Rs. Rs. LacsRawMaterial

Imported 11.22% 944.82 65.18% 6511.39Indigenous 88.78% 7477.32 34.82% 3478.14

Stores & Spares(Including value of items purchased for manufacture of dies)

Imported 2.76% 9.71 1.48% 13.00Indigenous 97.24% 342.05 98.52% 225.08

17. CIF value of ImportsRaw material 944.82 6511.39Stores & Spare parts 9.71 13.00

18. Expenditure in Foreign CurrencyTravel 1.00 1.97Interest 94.62 89.66

19. FOB Value OfExport 1154.93 320.72

20. Remuneration:A: Auditors RemunerationAudit Fees 0.55 0.43TaxAudit Fees 0.15 0.15VAT Audit Fees 0.15 0.11Other Services 0.05 0.05

0.90 0.74

B: Directors RemunerationSalary 24.00 22.80Setting Fees 12.00 0.00Contribution to Provident Fund 0.00 0.00

36.00 22.80

During the year remuneration of Rs 6.00 Lacs was paid to the Chairman and managing director as per resolution approved byShareholders in the general meeting.

21. Disclosure of related parties / related party transactions:


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a) Names of related parties :Sr Name of Related Party Relationship1 Volition Trading Private Ltd. Associated Concern2 Pankaj Metals Associated Concern3 Pankaj Metal Centre Pvt. Ltd Associated Concern4 Europan Metal Pvt. Ltd Associated Concern5 ACEMetals Pvt Ltd Associated Concern6 Alucast Engineering Pvt Ltd Associated Concern7 P & S Metals Ltd JV Company

b) Disclosure of related party transactions: (Rs. Lacs)Current Year (2008 - 09)

Sr.No.

Nature of relationshipTransaction

AssociatedConcerns

Key ManagementPersonnel

Relatives ofKey Management

Personnel1 Purchase of Goods 3867.54 ---- ----2 Sale of Goods 492.33 ---- ----3 Rent Paid 0.00 ---- ----

4 Rent Received 0.00 ---- ----5 Interest Paid 25.89 ---- ----

Previous Year (2007 - 08)Sr.

No.Nature of relationshipTransaction

AssociatedConcerns

Key ManagementPersonnel

Relatives ofKey Management

Personnel1 Purchase of Goods 5395.18 ---- ----2 Sale of Goods 733.65 ---- ----3 Rent Paid 0.00 ---- ----4 Rent Received 0.00 ---- ----5 Interest Paid 2.28 ---- ----

(Rs. Lacs)

d) Outstanding balances as on31.3.2009 31.3.2008

Loans & AdvancesAssociated Concerns 9.47 205.69KeyManagement Personnel & Relatives 0.00 0.00

Sundry CreditorsAssociated Concerns (722.62) (69.84)KeyManagement Personnel & Relatives 0.00 0.00

Unsecured LoansAssociated Concerns 995.15 614.80KeyManagement Personnel & Relatives 0.00 0.00

Sundry DebtorsAssociated Concerns 263.82 0.00

KeyManagement Personnel & Relatives 0.00 0.00


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22. Earnings per share (EPS) computed in accordance with Accounting Standard 20:(Rs. Lacs)

2008-2009 2007-2008

Profit/(Loss) for the year (876.11) 210.77

Prior period adjustment 0.00 (2.00)

Income Tax 0.00 22.55

Fringe Benefit Tax 1.94 2.39

Deferred Tax Liability (322.38) 22.42

Net Profit/(Loss) (555.67) 163.41

*Weighted average number ofEquity Shares outstanding (Number in lacs) 90.00 90.00

Basic and diluted earnings per share (Rs.) (6.17) 1.19

Number of shares outstanding from 01.04.2008 to 31.03.2009 90.00 90.00


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23. Additional information as required under Part IV of Schedule VI to the Companies Act, 1956

Balance Sheet Abstract and Companys General Business Profile:I Registration Details

Registration No 31852 State Code 0 4Balance Sheet 3 1 03 2009

Date Month YearII Capital Raised during the year (Rs. 000)

Public Issue N I L Rights Issue N I LBonus Issue N I L Private Placement N I L

III Position ofMobilization and Deployment of Funds (Rs. 000)

Total Liabilities 781194 Total Assets 781194

Sources of FundsPaid-up Capital 90000 Reserves & Surplus 80475Secured Loans 421058 Unsecured Loans 138159Share Application Money 37500 Deferred Tax Liabil ity 14001

Application of FundsNet Fixed Assets 380087 Investments 23897Net CurrentAssets 338260 Pre-Operative Expenditure 23466Misc. Expenditure 155

IV Performance of Company (Rs.000)Turnover 1163876 Total Expenditure 1177120Profit/Loss before Tax (+) () (87610) Profit/Loss after Tax (+) () (55567)(Please tickAppropriate box + for Profit, - for Loss)Earnings per share in Rs (6.17) Dividend @% N I L

V Generic Names of Three Principal Products/Services of Company (as per monetary terms)

Item Code No. (ITC Code) 76.01

Product Description ALUMINIUMALLOY INGOTS & BILLETS

Item Code No. (ITC Code) 76.04Product Description ALUMINIUM PROFILES

Item Code No. (ITC Code) 76.08Product Description ALUMINIUM PIPES AND TUBES

The figures of the previous year have been regrouped/rearranged wherever considered necessary.

Signatures to the Schedules 1 to 17 which from an integral part of the Accounts.The Schedules referred to above form part of the Accounts

As per our report of even date attached Harakhchand N Shah Jayesh ShahFor VINESH MEHTA & CO. Chairman & Managing Director Hitesh Shah

Chartered Accountants Hiren ShahDirectors


H N Shah J H Shah Vadodara Director Date: June 24, 2009

12th ar audited

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