1

Annual Report 2011-12Sabero

CONTENTS

Page No.

Corporate Information...................................................................................................................... 02

Notice .............................................................................................................................................. 03

Directors’ Report .............................................................................................................................. 08

Management Discussion & Analysis................................................................................................ 12

Corporate Governance Report ....................................................................................................... 16

Auditors’ Report on Financial Statements ....................................................................................... 28

Balance Sheet ................................................................................................................................. 32

Profit & Loss Account ...................................................................................................................... 33

Cash Flow Statement ...................................................................................................................... 34

Notes forming part of Financial Statements .................................................................................... 35

Signficant Accounting Policies and Notes on Accounts ................................................................... 44

Auditors' Report on Consolidated Financial Statements ................................................................. 51

Consolidated Balance Sheet ........................................................................................................... 52

Consolidated Profit & Loss Account ................................................................................................ 53

Consolidated Cash Flow Statement ................................................................................................ 54

Notes forming part of Consolidated Financial Statements .............................................................. 55

Significant Accounting Policies & Notes on Consolidated Accounts ............................................... 64

Statement under Section 212 (8) of the Companies Act, 1956 ....................................................... 69

Attendance Slip & Proxy Form ........................................................................................................ 71

2

Sabero

BOARD OF DIRECTORS : Mr. M. K. Tandon Chairman Mr. V. Ravichandran Director Mr. M. M. Venkatachalam Director Mr. Jayesh Gandhi Director Mr. Sujal Shah Director Mr. Kapil Mehan Director Mr. G. Veera Bhadram President & Whole-time Director

COMPANY SECRETARY : Ms. Pritam Vartak

AUDITORS : M/s. S M N P & Co., Chartered Accountants

BANKERS : Union Bank of India Bank of India State Bank of India Oriental Bank of Commerce IDBI Bank Limited Dena Bank ICICI Bank Limited The Ratnakar Bank Limited Axis Bank Limited Export-Import Bank of India HDFC Bank Limited The Federal Bank Limited

REGISTERED OFFICE : Plot No. 2102, GIDC Sarigam 396 155 Dist. Bulsar Sate: Gujarat Tele fax. : 0260 3918500

CORPORATE OFFICE : Bezzola Commercial Complex, A Wing, 3rd Floor, Suman Nagar, Sion Trombay Road, Chembur, Mumbai-400071 Tel No.: 022 - 61132400 • Fax : 022 - 61132405

REGISTRARS & SHARE : Link Intime India Private LimitedTRANSFER AGENTS C-13, Pannalal Silk Mills Compound LBS Marg, Bhandup (West) Mumbai 400 078 Tel. 022 25963838 • Fax 022 25946979

CORPORATE INFORMATION

3

Annual Report 2011-12SaberoNOTICE

NOTICE is hereby given that the 21st Annual General Meeting of the Members of Sabero Organics Gujarat Limited will be held on Friday, 13th July, 2012 at 12.30 P.M. at Plot No. 2102, GIDC, Sarigam - 396 155, Dist. - Bulsar, Gujarat to transact the following business:

ORDINARY BUSINESS:

1. To receive, consider and adopt the Audited Balance Sheet of the Company as at 31st March, 2012 and the Profit & Loss Account for the financial year ended on that date together with the Report of the Directors’ and Auditors’ thereon.

2. To appoint a Director in place of Mr. M. K. Tandon, who retires by rotation and being eligible, offers himself for re-appointment.

3. To appoint a Director in place of Mr. V. Ravichandran, who retires by rotation and being eligible, offers himself for re-appointment.

4. To appoint Statutory Auditors to hold office from the conclusion of this Annual General Meeting until the conclusion of the next Annual General Meeting. The retiring Auditors M/s. SMNP & Co., Chartered Accountants, have informed the Company that they do not wish to seek re-appointment as Statutory Auditors of the Company. The Company has received a special notice from a member proposing the appointment of M/s Deloitte Haskins & Sells, Chartered Accountants as Statutory Auditors of the Company in the place of M/s. SMNP & Co., Chartered Accountants.

To consider and if deemed fit, to pass with or without modification(s), the following Resolution as an Ordinary Resolution:

“RESOLVED THAT M/s Deloitte Haskins & Sells, Chartered Accountants, bearing Registration No.008072S with the Institute of Chartered Accountants of India, be and are hereby appointed as Statutory Auditors of the Company to hold office from the conclusion of this Annual General Meeting until the conclusion of the next Annual General Meeting on a remuneration of `6 lakhs (Rupees Six Lakhs only) plus reimbursement of out of pocket expenses and service tax.”

SPECIAL BUSINESS:

5. To consider and if deemed fit, to pass with or without modification(s), the following Resolution as an Ordinary Resolution:

“RESOLVED THAT Mr. Jayesh Gandhi, who was appointed as an Additional Director pursuant to Section 260 of the Companies Act, 1956 and Article

74 of the Articles of Association of the Company to hold office up to the date of this Annual General Meeting of the Company and in respect of whom the Company has received a notice in writing pursuant to the provisions of Section 257 of the Companies Act, 1956, proposing his candidature as a Director of the Company, be and is hereby appointed as a Director of the Company, liable to retire by rotation.”

6. To consider and if deemed fit, to pass with or without modification(s), the following Resolution as an Ordinary Resolution:

“RESOLVED THAT Mr. Sujal Shah, who was appointed as an Additional Director pursuant to Section 260 of the Companies Act, 1956 and Article 74 of the Articles of Association of the Company to hold office up to the date of this Annual General Meeting of the Company and in respect of whom the Company has received a notice in writing pursuant to the provisions of Section 257 of the Companies Act, 1956, proposing his candidature as a Director of the Company, be and is hereby appointed as a Director of the Company, liable to retire by rotation.”

7. To consider and if deemed fit, to pass with or without modification(s), the following Resolution as an Ordinary Resolution:

“RESOLVED THAT Mr. M. M. Venkatachalam, who was appointed as an Additional Director pursuant to Section 260 of the Companies Act, 1956 and Article 74 of the Articles of Association of the Company to hold office up to the date of this Annual General Meeting of the Company and in respect of whom the Company has received a notice in writing pursuant to the provisions of Section 257 of the Companies Act, 1956, proposing his candidature as a Director of the Company, be and is hereby appointed as a Director of the Company, liable to retire by rotation.”

8. To consider and if deemed fit, to pass with or without modification(s), the following Resolution as an Ordinary Resolution:

“RESOLVED THAT Mr. Kapil Mehan, who was appointed as an Additional Director pursuant to Section 260 of the Companies Act, 1956 and Article 74 of the Articles of Association of the Company to hold office up to the date of this Annual General Meeting of the Company and in respect of whom the Company has received a notice in writing pursuant to the provisions of Section 257 of the Companies Act, 1956, proposing his candidature as a Director of the Company, be and is hereby appointed as a Director of the Company, liable to retire by rotation.”

4

Sabero9. To consider and if thought fit to pass with or without

modification(s), the following Resolution as an Ordinary Resolution:

“RESOLVED THAT Mr. G. Veera Bhadram, who was appointed as an Additional Director pursuant to Section 260 of the Companies Act, 1956 and Article 74 of the Articles of Association of the Company to hold office up to the date of this Annual General Meeting of the Company and in respect of whom the Company has received a notice in writing pursuant to

the provisions of Section 257 of the Companies Act, 1956, proposing his candidature as a Director of the Company, be and is hereby appointed as a Director of the Company.”

By Order of the Board of DirectorsFor Sabero Organics Gujarat Limited

Sd/-

Place: Mumbai Pritam VartakDate: 18.04.2012 Company Secretary

NOTES:1. A MEMBER ENTITLED TO ATTEND AND VOTE AT THE MEETING IS ENTITLED TO APPOINT ONE OR MORE

PROXIES TO ATTEND AND VOTE INSTEAD OF HIMSELF AND SUCH PROXY NEED NOT BE A MEMBER OF THE COMPANY.

2. Proxies in order to be effective, should be duly completed, stamped and signed must be deposited at the Registered Office of the Company not less than 48 hours before the commencement of the Meeting.

3. Members desirous of obtaining any information as regards accounts and operations of the Company are requested to send their queries in writing so as to reach at the Corporate Office of the Company at Mumbai at least 10 (ten) days before the date of the meeting, to enable the Company to keep the information ready.

4. Explanatory Statement relating to the Special Business under Item Nos. 5 to 9 as required under Section 173 (2) of the Companies Act, 1956 is annexed hereto.

5. The Register of Members of the Company will remain close from 6th July, 2012 to 13th July, 2012 (both days inclusive).6. Members are requested to notify immediately any change in their address to their Depository Participants (DPs) in

respect of their electronic share accounts quoting Client ID No. and in case of shares are held in physical form, to Link Intime India Private Limited, Registrar and Transfer Agents in respect of their physical shares, quoting Folio No.

7. The Company’s shares are traded in electronic form. The investors are requested to hold their securities in the electronic form.

8. The relevant details of Directors seeking appointment / re-appointment, under the item nos. 2, 3, 5, 6, 7, 8 & 9 above, are as follows:Name Mr. M. K. Tandon Mr. V. RavichandranAge 70 years 56 yearsDate of Appointment 11th July, 2011 11th July, 2011Qualification Masters Degree in Commerce, Degree in Law Engineering Graduate, Post Graduate

Diploma in Management, qualified as CostAccountant and Company Secretary.

Nature of Expertise Finance, Insurance and General Management Finance, Marketing and General ManagementExperience More than 45 years More than 30 yearsNames of other companies in which holds Directorship (excluding foreign and private companies)

1. Coromandel International Limited2. Welspun Syntex Ltd.3. GIC Housing Finance Limited4. Welspun Projects Limited

1. Coromandel International Limited2. E I D Parry (India) Limited3. Parrys Sugar Industries Limited4. Murugappa Holdings Ltd.

Names of other public companies in which holds Committee membership / Chairmanship*

Coromandel International Limited- Chairman of Audit Committee and Share Transfer and Investor Grievance CommitteeGIC Housing Finance Limited- Chairman of Audit Committee & Investor grievance CommitteeWelspun Syntex Limited- Member of Audit CommitteeWelspun Projects Limited - Member Audit Committee

EID Parry (India) Limited – Member of Audit Committee & Investors Grievance CommitteeCoromandel International Limited – Member of Share Transfer and Investor Grievance CommitteeParrys Sugar Industries Limited- Member of Audit Committee

Shareholding in the Company Nil Nil

5

Annual Report 2011-12SaberoName Mr. Jayesh Gandhi Mr. Sujal ShahAge 50 years 43 yearsDate of Appointment 2nd December, 2011 2nd December, 2011Qualification B.Com, F.C.A B. Com, F.C.ANature of Expertise Finance, Accounting and Auditing Finance, Mergers & Acquisition and Corporate AdvisoryExperience 28 years 20 yearsNames of other companies in which holds Directorship (excluding foreign and private companies)

1. Aventis Pharma Limited2.ICICI Home Finance Company Ltd

1.Gitanjali Gems Limited2.Reliance Assets Reconstruction Company Limited3.Reliance MediaWorks limited4.Keynote Corporate Services Limited5.Amal Limited6.Hindoostan Technical Fabric Limited7. Amrit Banasapati Co. Ltd.8.Hindoostan Mills Limited9.Rudolf Atul Chemicals Limited

Names of other public companies in which holds Committee membership / Chairmanship*

Aventis Pharma Limited- Member of Audit Committee

ICICI Home Finance Company Limited-Chairman of Audit Committee

Gitanjali Gems Limited-Chairman of Audit CommitteeReliance Assets Reconstruction Company Limited -Chairman of Audit CommitteeReliance MediaWorks limited-Chairman of Audit CommitteeKeynote Corporate Services Limited-Chairman of Audit CommitteeAmal Limited-Member of Audit CommitteeAmrit Banasapati Co. Ltd. -Member of Audit CommitteeHindoostan Mills Limited – Chairman of Audit CommitteeRudolf Atul Chemicals Limited- Member of Audit Committee

Shareholding in the Company Nil Nil

Name Mr. M. M. Venkatachalam Mr. Kapil MehanAge 53 years 54 yearsDate of Appointment 19th December, 2011 19th December, 2011Qualification Graduated from the University of Agricultural

Sciences, Masters Degree in Business Administration from George Washington University, USA,

Graduate in Veterinary Science and Animal Health, PG Diploma in Management from IIM, Ahmedabad

Nature of Expertise General Management and Administration General Management and Marketing

Experience 29 years 32 yearsNames of other companies in which holds directorship (excluding foreign and private companies)

1. Parry Enterprises India Ltd2.Cholamandalam Factoring Ltd3. Ramco Systems Ltd.4.Polutech Ltd5. Ambadi Enterprises Ltd.6. USV Limited7.Coromandel International Ltd.8. Coromandel Engineering Company Ltd.9.Parry Agro Industries Ltd.10. New Ambadi Estates Private Limited11. Parry Murray and Company Furnishings & Floor Coverings (India) Private Limited.

1.Coromandel International Limited2.Parry Chemicals Limited

Names of other public companies in which holds Committee membership / Chairmanship*

Ramco Systems Ltd.- Chairman of Audit Committee-Coromandel International Ltd- Member of Audit Committee

Nil

Shareholding in the Company Nil Nil

6

SaberoName Mr. G. Veera BhadramAge 54 yearsDate of Appointment 19th December, 2011Qualification Graduation in Agriculture from AP Agricultural University, and Post

Graduation in Agricultural Economics from G B Pant University of Agriculture and Technology, PG Diploma in Management

Nature of Expertise Sales & Marketing, Exports and General ManagementExperience 28 yearsNames of other companies in which holds directorship (excluding foreign and private companies)

1) Parry Chemicals Limited

Names of other public companies in which holds Committee membership / Chairmanship*

NIL

Shareholding in the Company Nil

*Note : Represents Directorship / Membership of Audit & Investors Grievance Committee of Public Ltd. Companies governed by Companies Act, 1956

9. All documents referred to in the accompanying Notice and the Explanatory Statement are open for inspection at the Registered Office of the Company during office hours on all working days except Saturday between 11.00 a.m. and 1.00 p.m. up to the date of the Annual General Meeting and the same will be available for inspection at the Annual General Meeting.

By Order of the Board of Directors For Sabero Organics Gujarat Limited

Sd/-Place: Mumbai Pritam VartakDate: 18.04.2012 Company Secretary

ITEM NO. 5

The Board of Directors of the Company had appointed Mr. Jayesh Gandhi as an Additional Director of the Company with effect from 2nd December, 2011 to hold office upto the date of ensuing Annual General Meeting and being eligible to offers himself for re-appointment. The Company has received notice under Section 257 of the Companies Act, 1956 proposing his candidature for the office of Director of the Company.

Mr. Jayesh Gandhi has done Graduation in Commerce and is also a Member of the Institute of Chartered Accountants of India. He Joined M/s. N. M. Raiji & Co. Chartered Accountants in the year 1985 and became a partner in 1989. He has got wide experience in the field of Finance, Accounts, Taxation and Audit. Presently member of the Managing Committee of Bombay Chartered Accountants Society (BCAS). Also, member of The Accounting and Auditing Committee (since last 6 years).

None of the directors of the Company except Mr.

ANNEXURE TO THE NOTICE

Jayesh Gandhi is interested or concerned in this resolution.

ITEM NO 6

The Board of Directors of the Company had appointed Mr. Sujal Shah as an Additional Director of the Company with effect from 2nd December, 2011 to hold office upto the date of ensuing Annual General Meeting and being eligible to offers himself for re-appointment. The Company has received notice under Section 257 of the Companies Act, 1956 proposing his candidature for the office of Director of the Company.

Mr. Sujal Shah is a Graduate in Commerce and a member of the Institute of Chartered Accountants of India having an overall post qualification experience of about 20 years. He is founder partner of M/s. SSPA & Co., Chartered Accountants, Mumbai. He was also associated with M/s. N. M. Raiji & Co. for a period of 12 years (8 years as partner) and with M/s. Dalal & Shah for a period of 2 years as partner.

Explanatory Statement as required by Section 173 (2) of the Companies Act, 1956 (‘the Act’)

7

Annual Report 2011-12SaberoHe has wide experience in the areas of Valuation for Mergers & Acquisitions, advising on restructuring of business, conducting financial due-diligence and general corporate advisory. He has been a team member in several large Corporate Mergers. He has been a regular faculty on the subject of “Valuation”, “Financial Due Diligence” etc. at seminars and conferences organized by the Institute of Chartered Accountants of India and other reputed organizations.

None of the directors of the Company except Mr. Sujal Shah is interested or concerned in this resolution.

ITEM NO. 7

The Board of Directors of the Company had appointed Mr. M. M. Venkatachalam as an Additional Director of the Company with effect from 19th December, 2011 to hold office upto the date of ensuing Annual General Meeting and being eligible to offers himself for re-appointment. The Company has received notice under Section 257 of the Companies Act, 1956 proposing his candidature for the office of Director of the Company.

Mr. M M Venkatachalam is Graduate from the University of Agricultural Sciences in Bangalore and holds a Masters Degree in Business Administration from George Washington University, USA. He has held senior positions in the Murugappa Group of Companies spanning over period of two and a half decades and has wide administrative and managerial experience.

None of the directors of the Company except Mr. M. M. Venkatachalam is interested or concerned in this resolution.

ITEM NO.8

The Board of Directors of the Company had appointed Mr. Kapil Mehan as an Additional Director of the Company with effect from 19th December, 2011 to hold office upto the date of ensuing Annual General Meeting and being eligible to offer himself for re-appointment. The Company has received notices under Section 257 of the Companies Act, 1956 proposing his candidature for the office of Director of the Company.

Mr. Kapil Mehan is a Graduate in Veterinary Science and Animal Health. He also holds a PG Diploma in Management from IIM, Ahmedabad with specialization

in Agriculture He started his career with Rallis India and later moved on to Tata Chemicals Limited. He has held various positions in Sales and Marketing function in Rallis and Tata Chemicals Limited before moving into the position of Chief Operating Officer for its fertilizers business in 2003. In 2008, he was appointed as the Executive Director of Coromandel International Limited (Holding Company). Presently he is occupying the office of the Managing Director of Coromandel International Limited (Holding Company).

None of the directors of the Company except Mr. Kapil Mehan is interested or concerned in this resolution.

ITEM NO.9

The Board of Directors of the Company had appointed Mr. G. Veera Bhadram as an Additional Director of the Company with effect from 19th December, 2011 to hold office upto the date of ensuing Annual General Meeting and being eligible offers himself for re-appointment. The Company has received notice under Section 257 of the Companies Act, 1956 proposing his candidature for the office of Director of the Company.

Mr. G Veera Bhadram has done his Graduation in Agriculture from AP Agricultural University, and Post Graduation in Agricultural Economics from G B Pant University of Agriculture and Technology. He has done his Post Graduate Diploma in Management (Agriculture) from Indian Institute of Management, Ahmedabad (IIMA). In a career spanning close to three decades, he worked with Alembic group, Nagarjuna Group and IFFCO. In 2002, he joined EID Parry India Limited, part of the Murugappa Group. He has vast experience in the field of Marketing and Exports of Agro Chemicals.

None of the directors of the Company except Mr. G. Veera Bhadram is interested or concerned in this resolution.

By Order of the Board of DirectorsFor Sabero Organics Gujarat Limited

Sd/-Place: Mumbai Pritam VartakDate: 18.04.2012 Company Secretary

8

SaberoDIRECTORS' REPORT

Dear Members,

Your Directors have pleasure in presenting the 21st Annual Report and the Audited Financial Statements for the year ended 31st March, 2012.

SUMMARY OF FINANCIAL RESULTS:(` In lacs)

Year Ended 31.03.2012

Year Ended 31.3.2011

Net SalesDomestics 17068.67 18590.44Exports 18774.00 22489.33Total 35842.67 41079.77Profit / (Loss) before Interest, Depreciation, Tax

(3548.42) 4154.88

Less: Finance Costs 2812.60 1547.48 Depreciation 1103.93 860.09Less: Provision for Tax (incl. deferred tax) (1340.58) 684.42Net Profit / (Loss) after Tax (6124.37) 1062.89

CHANGE IN MANAGEMENT AND CONTROL

The most significant happening during the course of the year under review has been the acquisition of the entire block of the existing Promoters shareholding of 42.22% in your Company by Coromandel International Ltd (“Coromandel”). Coromandel further acquired 31% of the Equity Shares of the Company through an open Offer pursuant to SEBI (Substantial Acquisition of Shares & Takeovers) Regulations, from the shareholders of the Company. Besides, Coromandel Subsidiary Parry Chemicals Ltd. also holds 1.35% Shares in the Company; thus together, with its Subsidiary Coromandel now holds 74.57% of the equity in the Company and effective 17th December, 2011, your Company has became a Subsidiary of Coromandel.

Your Company sees tremendous value in this relationship with Coromandel by leveraging synergies in operations, back up support in production, marketing and other areas, and in drawing upon the technical expertise and resources of Coromandel, the holding Company.

As a corollary to the change in management and control, the Board of Directors of the Company was reconstituted on the 19th December, 2011 as under: 1. Mr. M. K. Tandon Chairman*2. Mr. V. Ravichandran Director* 3. Mr. M.M. Venkatachalam Director 4. Mr. Jayesh Gandhi Director**5. Mr. Sujal Shah Director** 6. Mr. Kapil Mehan Director 7. Mr. G. Veera Bhadram President & Whole time Director

* Mr. M. K. Tandon and Mr. V. Ravichandran were appointed as Additional Directors on 11th July, 2011.

** Mr. Jayesh Gandhi & Mr. Sujal Shah were appointed as Additional Director on 2nd December, 2011.

OPERATIONS

The year under review has been a difficult period in terms of sustaining production plans. The Company had to contend with production capacity restraints all through the year under a continuing judicial ruling arising from a Public Interest Litigation (PIL). These constraints have been overcome significantly by ensuring strict compliance with environment related regulatory norms and the Company managed to secure permission for capacity utilization from zero level in April, 2011 to upto 75%, as from December,2011. Indeed, these entailed considerable investments in re-vamping Environmental Management Systems (EMS) for treatment of effluents, which are nearing completion; once fully implemented, the augmented EMS would help achieve compliance with the environmental regulations at higher production levels with volume efficiencies.

The restrictions placed on the capacity utilisation resulted in lower volumes in production and had a direct bearing on not being able to drive growth; this was a major factor in net Sales for the year under review at ` 35842.67 Lacs being of lower order as compared to `41079.77 Lacs for the previous year.

The operations during the year under review were also adversely impacted owing to increase in power & fuel costs; tight cash flows induced higher interest costs; margins were also impacted due to loss incurred under unusually volatile foreign exchange scenario.

DAHEJ PROJECT

Your Company has a plot of land acquired in the Special Economic Zone in Dahej, in State of Gujarat. The Dahej project was conceived to ramp up production facilities for the manufacturing of Technical active Ingredients and formulations. Now that the Company has become a Subsidiary of Coromandel International Limited, which has a sizeable presence in the Agro chemicals space, it made sense to revisit the focus area for the Dahej Project. The project Plan has been reviewed in terms of its complementary role in the changed scenario. The project is being recast such as to maximize its potential. The Project is scheduled to be completed during the current financial year 2012-13; meanwhile, manufacture of formulations has already commenced at Dahej facility in March, 2012.

OVERSEAS SUBSIDIARIES/ ASSOCIATE COMPANIES

The Company has Subsidiary Companies in Australia, Latin America, Argentina, Europe and one Associate Company

9

Annual Report 2011-12Saberoin Philippines, primarily to pursue grant of licenses and product registrations in conformity with the local laws of the respective countries/regions. Sabero Australia Pty Ltd :The Company (a wholly owned subsidiary) incurred net profit / loss of Australian Dollar Nil (equivalent to ` Nil) during the year ended March 31, 2012.Sabero Europe B. V :The Company (a wholly owned subsidiary) incurred net loss of Euro 1,447 (equivalent to `0.95 lacs) during the year ended March 31, 2012.Sabero Argentina S. A. :The Company (a subsidiary) generated a net profit of Argentina Pesos 20610 (equivalent to `2.32 lacs) during the year ended March 31, 2012.Sabero Organics America S. A. :The Company (a subsidiary) incurred net loss of Brazilian Real 8,69,142 (equivalent to ` 241.99 Lacs, during the year ended March 31, 2012, mainly on account of settlement with Embrasil, Brazil and Markan Agroquimica Ltd, Brazil. Consequent to this, the Company is no longer a co-venturer in Markan.

DIRECTORS

In accordance with the requirements of the Companies Act, 1956, and Article 70 of the Articles of Association of the Company, Mr. M. K. Tandon and Mr. V. Ravichandran, Directors of the Company will retire by rotation at the ensuing Annual General Meeting and being eligible, offers themselves for re-appointment. During the year under review, Mr. Jayesh Gandhi, Mr. Kapil Mehan,Mr. Sujal Shah, Mr. M. M. Venkatachalam and Mr. G. Veera Bhadram were appointed as Additional Directors and notices have been received from shareholders proposing their appointment as Directors of the Company. The details of Directors seeking appointment or re-appointment as required by Clause 49 of the Listing Agreement are provided in the Note-8 to the Notice convening the ensuing Annual General Meeting of the Company.

During the year under review, Mr. Hero Chuganee, Mr. Mohit Chuganee, Mr. Sumit Chuganee, Mr. Rajesh Sharma, Mr. C. M. Ashok Muni, Mr. Raj Tandon, Mr. John R. English, Mr. Kishore Dudani and Mr. Mahendra Kothari, Directors of the Company have resigned from the office of Director. The Board of Directors wish to place on record their appreciation for the contribution made by these Directors during their tenure.

PUBLIC DEPOSITS

During the financial year 2011-12, the Company did not accept any deposits from the public under Section 58A of the Companies Act, 1956 and rules made thereunder.

AUDITORS

The term of appointment of M/s. SMNP & Co. Chartered Accountants, Statutory Auditors expires at the conclusion of the ensuing Annual General Meeting of the Company.

M/s. SMNP & Co. have informed the Company that they do not wish to seek re-appointment as Statutory Auditors at the ensuing Annual General Meeting.

A Special Notice has been received from a Member proposing the appointment of M/s Deloitte Haskins & Sells, Chartered Accountants, as Statutory Auditors of the Company.

COST AUDITORS

In pursuance of Section 233B of the Companies Act, 1956 the Central Government has ordered Cost Audit for Insecticides products. Accordingly Mr. Narottam Tola, Cost Accountant was appointed as a Cost Auditor to render reports to the Central Government. The Report for the year financial 2010-11 was submitted on 30th March, 2012 and for the financial year 2011-12 will be filed on or before due date.

CONSOLIDATED FINANCIAL STATEMENTS

Consolidated Financial Statements incorporating the operations of the Company and its Subsidiaries is appended. The Ministry of Corporate Affairs, has given a general exemption to Companies from publishing the Annual Report of its Subsidiary Companies wherever a Consolidated Statement has been appended. In view of this, the Annual Report of the Subsidiary Companies, i.e. Sabero Australia Pty Ltd, Sabero Europe B. V., Sabero Argentina S.A. and Sabero Organics America S. A. has not been annexed. However, the Accounts of the Subsidiary Companies and the related information will be made available to the Members of the Company and its Subsidiary Companies on request and will also be kept for inspection in the Registered Office.

A Statement under Section 212(8) of the Companies Act, 1956 is attached after Audited Financial Statements of the Company and forms part of this Annual Report.

DISCLOSURES

Information relating to the Conservation of Energy, Technology Absorption, Adaptation & Innovation and Foreign Exchange Earnings and Outgo required under Section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 are annexed hereto and forms part of this report.

Information as per Section 217(2A) of the Companies Act, 1956 read with Companies (Particulars of Employees) Rules, 1975 is annexed hereto and forms part of this Report.

Pursuant to Clause 49 of the Listing Agreement, a Report on Corporate Governance along with a certificate from M/s. Rathi & Associates, Company Secretaries in practice, regarding compliance of the requirements of

10

SaberoCorporate Governance is annexed hereto and Management Discussion & Analysis Report which highlight the industry structure and developments, opportunities and threats, future outlook, risks and concerns etc is annexed hereto.

DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to the requirement of Section 217(2AA) of the Companies Act, 1956 with respect to Directors’ Responsibility Statement, it is hereby confirmed:

(i) That in the preparation of the accounts for the financial year ended 31st March 2012, the applicable Accounting Standards have been followed;

(ii) That the Directors have selected such accounting policies, applied them consistently and made judgment & estimates that were reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the loss of the Company for the year under review;

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

(iv) That the Accounts for the financial year ended 31st March, 2012 have been prepared on a ‘going concern’ basis.

ACKNOWLEDGEMENTS

The Directors wish to place on record their deep sense of appreciation of the Cooperation and assistance received by the Company from suppliers and vendors, Customers and Business Associates, its Bankers and the Financial Institutions and from the agencies /bodies of the Central Government and the Government of Gujarat and for the continued confidence placed in it by the esteemed body of investors and Stakeholders. The Directors also wish to acknowledge and place on record the significant contribution made by the employees at all levels in the sustained performance of the Company.

On behalf of the Board of Directors

Sd/-M. K. Tandon

ChairmanPlace: Mumbai Date:18.04.2012

ANNEXURE “A” TO THE DIRECTORS’ REPORT

Information under Section 217 (1) (e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 and forming part of the Directors’ Report.

FORM - A

DISCLOSURE OF PARTICULARS WITH RESPECT TO CONSERVATION OF ENERGY

CURRENT YEAR2011-12

PREVIOUS YEAR2010-11

A. POWER & FUEL CONSUMPTION1) Electricity a) Purchased Units (kwh) 19,839,250 21,142,000 Total Amount (`) 134,239,341 130,010,642 Average Rate / Unit (`) 6.77 6.15 b) Own Generation- Through Diesel generator Unit (kwh) 298,153 266,820 Diesel used in D. G. 122,829 109,921 Unit per liter of Diesel Oil 2.43 2.61 Cost per unit (`) 18.13 16.33- Through gas engine Unit (kwh) 4,115,184 Nil Total amount (` 13,345,882 Nil Unit per Scm of gas 24.11 Nil Cost per unit (`) 3.24 Nil2) Fuel for Steam Generation i. Furnace Oil Quantity (KL) 125 69.92 Total Amount (`) 5,789,230 2,487,184 Average Rate (`/KL) 46,240 35,572 ii. HSD (KL) Total Amount ` Nil Nil Average Rate (`/KL) Nil Nil iii. Natural Gas, cubic meters 13,536,492 8,552,695 Total amount 326,395,541 149,005,363Average rate,( ` cu. Mtr) 24.11 17.42CONSERVATION OF ENERGY:Following are steps undertaken for conservation of energy:1. Installed 20 MT capacity of boiler with 91% efficiency

and all boilers are operating on natural gas.2. Boiler efficiency improvements achieved by effective

recycling of the condensate.3. The efficient multiple effective evaporation systems

are installed for savings in power and steam. 4. The current low efficient chilled water systems are

replaced by more efficient chilled water system with energy efficient compressors.

5. Energy saving Automation systems implemented on cooling tower, chilled water, and chilled brine.

11

Annual Report 2011-12SaberoDisclosure of particular with respect to:

a) Research & Development: (R & D)

R & D of the Company is recognized by Department of Science & Industrial Research (DSIR), Government of India and is fully equipped with modern sophisticated instruments like Gas Chromatography, High Pressure Liquid Chromatography, UV-Visible Spectrophotometer, Potentiometer Titrator and ultra modern equipments with the state of art of technology with highly qualified and skilled man power inclusive of PhDs and Post Graduates as the working staff with rich experience contributing to the overall growth of the company.

The in-house developed products without patent infringement are being introduced on commercial scale of which a few are already commercialized keeping in mind the Environmental Management Systems (EMS) whereby the effluents generated are recycled for reuse and thereby reducing the effluent loads.

R & D has its own regulatory affairs department wherein registration activities are done and have been internationally recognized.

b) Technology Absorption, Adoption and Innovation:

During the Financial Year 2011-12:

- Process for backward integration of NaHTCP as the basic raw material for the manufacture of Chlorpyriphos was stabilized and commercialized.

- Process developed for Propineb, which is one of the key fungicides and plans drawn up for commercialization in the coming year.

Consequent to the acquisition of the Company by Coromandel International Ltd., the Company has now access to the R&D facility of the parent company.

c) Foreign Exchange Earnings and Outgo:

(` in Lacs)

CURRENT YEAR2011-12

PREVIOUS YEAR2010-11

1. Foreign Exchange earnedExport of goods on FOB basis 18,513.84 21,892.70

2. Outgo of foreign exchange- Raw materials on CIF basis 9,199.07 14,014.63

- Stores, spares, capital goods 7.33 14.20

- Commission 124.82 147.72

- Product Registration Expenses

224.17 23.61

-Travelling Expenses 36.67 46.41

- Interest 84.63 41.21

- Others 159.31 29.71

Total 9,836.00 14,317.49

ANNEXURE “B” TO THE DIRECTORS’ REPORTInformation as per Section 217 (2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, and forming part of the Directors’ Report.

Name Designation Remuneration (`) Gross / Net

Qualification Experience(Yrs)

Date of commencement of employment

Age Particulars of last employment

Mr. G. Veera Bhadram

President & Whole-time Director

Gross `15,48,322/- Graduation in Agriculture, Post Graduation in Agricultural Economics, PG Diploma in Management

28 years 19th December, 2011 54 years Coromandel International Limited-Senior Vice President-Pesticides SBU

Mr. Mohit H. Chuganee*

Vice Chairman & Managing Director

Gross `1,03,88,046/- B.Sc. in Electrical Engineering, MBA in International Management

24 years 29th November, 1991 46 years Nil

Mr. Sumit Chuganee**

Executive Vice Chairman and Whole -time Director

Gross `98,60,138/- B.S. in Electrical Engineering M.B.A in Finance,

22 years 7th May, 1992 45 years Nil

* Resigned as Vice Chairman & Managing Director w.e.f. 17th December, 2011 and as Director w.e.f. 19th December, 2011

** Resigned as Executive Vice Chairman & Whole-time Director w.e.f. 17th December, 2011 and as Director w.e.f. 19th December, 2011

12

SaberoMANAGEMENT DISCUSSION AND ANALYSIS

Statements in this Report, particularly those which relate to the Company’s objectives, projections, estimates and expectations may constitute forward looking statements within the meaning of applicable laws and regulations. Actual results might differ materially from those either expressed or implied.

Business Environment and Overview

Global Agrochemical Industry :

• The Agrochemical Industry is interdependent with the performance of the agricultural sector. It is known that monsoons play a significant role in the performance of the agricultural eco system, and in good seasons, there is a demand upsurge for agrochemical products as well. Worldwide, agrochemicals are finding increasing acceptance, thanks to the dawning awareness of how beneficial their role could be in maximizing returns by way of crop protection and enhancement of yields. The potential for growth sees a large number of existing players operating in keen competition with each other not only in their respective domestic markets, but in the global context as well. On the one hand, one has to strive and develop new customers and markets; on the other hand, for achieving organic growth and bigger share of the pie, the way to go is to develop new products through research and innovation. It is, indeed, an R&D driven Industry, calling for deployment of the best of technical expertise and knows how.

• Recent years have seen good rainfalls in Asian regions, as well as across Latin America and Europe. This has acted as spur in demand for the agro-chemical products with the farming community willing to invest in their wider usage in order to maximize their returns from higher yields and better margins from volumes. Thus, riding on good rainfall and strong crop prices, 2011 turned out to be a good year for the global agrochemical market; counting the crop and the non crop segments together, its size has grown to US $ 51,520 million in 2011 up from US $ 44195 million in 2010 – an increase of 16.6%. The crop protection market alone has grown by about 18% to US $ 45210 million from US$ 38315 million in 2010. Sales also got a boost as an offshoot of wide spread incidence of pests and diseases in major markets viz., Europe, Asia and Latin America. The global agrochemical market is being projected to grow around 2-3 % in real terms in the next 3 -5 year time span.

In Crop Protection Chemicals, fungicides usage continues to outpace that of insecticides and herbicides as farmers, wanting to take advantage of favorable strong commodity prices, are known to invest in their usage for higher yields. An ever rising demand worldwide for high-quality food is perhaps the most compelling factor driving Crop protection Chemicals usage. Another factor driving their growth comes from the introduction of new molecules where the MNCs are the natural leaders with strong R & D and keeping continuous focus on researching in proprietary molecules and transgenic crops.

A significant development in 2011 relates to a sharp fall in the number of Glyphosate herbicide manufacturers in China in comparison to previous years. Chinese Pesticides Industry is in the process of consolidation and it is being anticipated that there would be as much as 30% reduction in the number of Chinese companies operating in the agrochemical space in the next 3 to 5 years. This is likely to impact the global supply and pricing of all generics from China to markets like India, South America and Africa.

Indian Agrochemical Industry :

The Indian agriculture Industry accounts for 12.9% of the nearly $ 2 trillion Indian economy and close to 58-60 million people are dependent on agriculture for their livelihood. India is the second biggest producer in the world of rice, wheat, sugar and cotton; India also happens to be among the top consumers of their produce, given the size of its population. It is also a reality of the Indian agriculture that it is heavily reliant on the monsoon. The spread and reach of the monsoon and its onset timing have a crucial bearing on the fortunes of the agricultural sector, and of those associated with it like the agrochemical industry.

2011 has been a year of erratic rainfalls. To begin with, the onset of rains were delayed, though satisfactory overall. Despite the late onset of monsoon, the country witnessed strong sowing of cotton crop. In the latter half of the year, rainfall was quite deficient in the South, thereby affecting the sowings in the Kharif season in that part of the country. The consumption of agrochemicals thereby suffered in critical States of Andhra, Karnataka and Maharashtra.

The agrochemical Industry suffered a serious setback as a fall out of a ban imposed on the marketing of Endosulfan in the domestic market altogether though, later on; the Industry was allowed to export accumulated stocks.

Among the positives, increasing of acreage under Paddy cultivation in the eastern parts of the country and good weather conditions prevailing for Wheat cropping in the

13

Annual Report 2011-12SaberoNorthern belt contributed to food grains production in the country touching record levels this year - proof pointers to the growing resilience of Indian agriculture against weather vagaries.

Prices of critical crops like Cotton, Paddy and Chilies ruled lower than previous year while Groundnut and Soyabean prices were stable.

The overall performance of the agrochemical Industry during the year 2011-12 has been satisfactory; information available as of now points towards the Industry reaching the market size of the previous year, thanks to the rather robust growth reported from northern and eastern regions compensating for shortfalls in the southern region.

Company’s Performance

The Company has product offerings in all the three segments of the crop protection Industry i.e., Fungicides, Insecticides and Herbicides. The Company strategy is to consolidate its presence through one or two key products and access customers across the globe with a view to ensure stable performance quarter on quarter in an otherwise seasonal industry. Export volumes complement domestic sales and insulate us against vagaries and shifts in market behavior, which is not so uncommon an experience in the agrochemical business.

The Company has a wide portfolio of product registrations and has set up distribution networks in key markets across several countries whereby it is in a position to market the products in its own brand name in addition to being a core supplier to several multi-national companies having their own product registrations. The Company has established subsidiaries in Australia, Europe, Brazil and Argentina which are key markets for its products; the subsidiaries were formed with the objective of obtaining registrations in the respective countries and as vehicles for building up distribution network in the relevant regions for achieving market penetration and improved realizations from exports.

The Company’s export and domestic sales are fairly even spread with Exports at 52% and Domestic Sales at 48% of the aggregate net Sales of ` 35843 Lakh in the year 2011-12 (Previous year ` 41080 Lakh). During the year under review, due to filing of Public Interest Litigation (PIL) with Hon’ble Court of Gujarat & passing of judiciary order, there were severe restrictions on capacity utilization at the Company’s Sarigam Plant, operations of the Company were severally affected.

The Company managed to secure removal of restictions and capacity enhancement through implementation of Environment Management System (EMS) projects and by ensuring adherence with the strict Effluent Treatment Plant (ETP) and EMS norms.

The below table gives the stages of removal of restrictions as under:

From To Capacity

Restriction (%) Allowed (%)

01-Apr-11 25-Apr-11 100% Nil

26-Apr-11 25-May-11 75% 25%

26-May-11 26-Jun-11 65% 35%

27-Jun-11 30-Nov-11 50% 50%

01-Dec-11 Till date 25% 75%

The Company was thereby able to step up production gradually. Loss of production contributed in a major way to sales volumes going down, particularly during the first two quarters, and though sustained efforts in latter half of the year brought about some recovery, sales turnover for the year as a whole was lower by 13%, compared to the turnover for the previous year.

There have been other issues of concern and they have pulled the margins significantly down; the operating costs shot up in consequence of spurt in costs of power, fuel, and utilities which taken together went up to 13.6% for the year under review as against 7% in the previous year. Raw material costs rose sharply as a result of the increase in labour and power costs in China pushing raw material prices upwards in the global markets.

The restrictions placed on capacity utilization at a time when the ongoing capital projects required funding of a sizeable order; delays in obtaining environmental clearance; and higher spending on effluent treatment led to cashflow problems culminating in further borrowings, higher interest costs and Forex losses.

With the operating costs going up substantially, the margins were eaten up and EBIDTA for the year under review was consequently of a much lower order in comparison with the previous year. In domestic formulation business,

14

Saberothe planned scale up did not materialize for a variety of reasons; for one, the availability of products was restricted; an indifferent monsoon in addressable markets was also a dampener, pulling down the sales.

The Company continued to focus on registration activity and received 69 registrations during the year across various countries. The ever increasing registrations are in the nature of being an enabler, ultimately leading to volume growth and better value realisation with the current customer base as well as help the Company access and reach out to new markets across its product range.

The Company has taken various steps as under to bring about sustained improvement in the operations of the Company:

• Investment already made in EMS projects would make it possible to undertake treatment of higher volumes of production and reduce effluent treatment costs.

• The Company has already applied for fuller utilization of capacity and the same is expected by Quarter – I of 2012-13.

• Introduction of Propineb and commercialization of Chlorpyriphos are likely to add value and volumes.

• Leveraging the overseas product registrations for access to new markets.

• Achieving improved efficiencies on energy / effluent treatment costs; enforcing material consumption norms ;sourcing costs and using synergy derived from the parent company is expected to result in growth in sales and minimize costs.

• Marketing team restructured with regional focus across the globe so as to achieve deeper market penetration, customer retention and improved price realizations.

• Dahej Project Plan being streamlined to be in tune with the new realities post acquisition of the Company by Coromandel International Limited effective 17thDecember, 2011, so as to mutually complement the capabilities overall across all plants. The Project is scheduled for completion in 2012-13.

• Formulation capacity addition already commissioned at Dahej in March,2012 would support expansion of manufacturing activity.

• Registration activities in European markets being

stepped up; registrations also being initiated in Mexico, South Africa and other focus markets.

Safety, Health & Environment

• The Company continues to be compliant with all statutory permissions and approvals.

• The Company has revamped the existing incinerator and has also installed a state of the art incinerator of high capacity to meet the incineration needs.

• The biological effluent treatment plant has been expanded to double its capacity.

• The company has installed (a) sophisticated online instrument TOC meter, (b) ORP control systems and (c) DO meter and pH control in the effluent treatment plant to monitor the quality of the final discharge over 24 hours.

• The Company has regular internal audits in place and promoting safety awareness among the employees is a key objective in its programmes/activities.

Risks and Concerns

High costs of power and of Natural Gas continue to be the major area of concern, and also constitute an unwanted barrier to further exploring the possibilities in certain products that are utility intensive processes.

Internal Control & Systems

• The Company’s Internal Audit and Control Systems are in place to achieve Total Productive Maintenance (TPM).

The Company has been regularly organizing programs on TPM and has retained the services of an external professional agency for its TPM Project at the factory which has helped the Company to achieve reductions in downtime, in rejections, in wastages and improvement in delivery schedule.

• The Company has formed an in house internal audit cell as well as engages outside agencies on need basis to establish processes and reviews transactions.

• The Company has also implemented SAP as the accounting and ERP system with established processes and controls.

This would be further strengthened through cross learning from parent company.

15

Annual Report 2011-12SaberoFuture Outlook

The global agrochemical Industry is looking for consolidation to upscale the level of operations and improve margins. The overall market size itself keeps on growing, year on year as the linkage of the Industry with the agriculture and food economy will continue to open new channels and markets. The growing income levels all over the world are driving consumption and demand for better quality food. The pressure to produce more and pushing for higher yields from limited arable land in countries like China, India, Australia, America, Brazil and Argentina, translates into growing opportunities for the crop protection Industry in the coming years.

Sabero has been a profit making Company with a track record of sustained performance over the years. The past year has been sort of an aberration, in terms of overall results owing to factors and circumstances over which the Company had little control.

Be as it may, the past year is behind us. The process of management changeover stands completed. The Company has since taken requisite corrective measures; it has gone for EMS system overhaul at considerable investment, the results of which are already visible. Capacity restraint issues have been dealt with, and we should soon be getting the go ahead for 100% capacity utilization. Further plans are in motion for capacity expansion.

The Company’s takeover by Coromandel International Ltd. is a watershed event in the Company’s evolutionary process of being a serious player of substance and size in the agrochemicals space. The Company is thus in a privileged relationship and sees itself benefiting from the synergy of operations and deriving value in various other ways.

The future outlook is promising, as we see it.

16

SaberoCORPORATE GOVERNANCE REPORT

Corporate Governance is about commitment to values and ethical business conduct. The Company believes that implementation of Corporate Governance Practices, maintaining transparency and dissemination of all relevent information to stakeholders is good practice to follow. Key elements of Corporate Governance are transparency, disclosure, supervision, internal controls, risk management, internal and external communications and high standards of safety, health, environment, accounting fidelity, product and service quality.

REPORT ON CORPORATE GOVERNANCE

The Company’s Shares are listed at Bombay Stock Exchange Limited and The National Stock Exchange of India Limited. In terms of Clause 49 of the Listing Agreement of Stock Exchanges (Clause 49), the Compliance Report on Corporate Governance is given as under:

I. COMPANY’S PHILOSOPHY ON CORPORATE GOVERNANCE:

The Company’s philosophy on Corporate Governance is driven to ensure that:

l quantity, quality and frequency of financial and managerial information which is shared with the Board, fully place the Board members in control of the Company’s affairs.

l the Board exercises its fiduciary responsibilities towards stakeholders thereby ensuring high accountability.

l the decision-making is transparent and documented through the Minutes of the Meetings of the Board/ Committees thereof.

l Maximising long term value of the stakeholders and of the Company along with protecting interest of the minority Shareholders.

l the Company strives to adopt world class operating practices.

II. BOARD OF DIRECTORS:

As a sequel to the change in ownership and management, the Company became subsidiary

of Coromandel International Limited w.e.f. 17th

December, 2011. As a corollary the Board of Directors of the Company was reconstituted on 19th December, 2011.

(a) Composition and Category of Directors:

The Composition of Board of Directors of the Company is in conformity with the requirements of the Corporate Governance Code of the Listing Agreement with the Stock Exchange(s). The Board of Directors of the Company consists of optimal combination of Executive, Non-Executive and Independent Directors.

As on 31st March, 2012, the Board has Seven (7) Directors, comprising of Six (6) Non-Executive Directors and one (1) Executive Director and out of 6 Non-Executive Directors, three (3) are Independent Directors. Presently, the Chairman of the Board is Non Executive Independent Director.

Members of the Board of Directors are experienced and have wide knowledge in their respective fields and General Management. All the members of the Board take active part in the Board and Committee Meetings. None of the Directors on the Board is a member on more than 10 Committees. The Company has obtained requisite disclosures from the Directors in respect of their respective Directorship in other Companies.

(b) Boards’ functioning and procedure:

The Board of Directors primary function remains policy direction and strategizing. The Board also sets Corporate goals and monitor Company performance on an ongoing basis.

In addition to its primary role of setting Corporate goals and monitoring Corporate performance, the Board directs and guides the activities of the management towards the attainment of such goals.

Details of Attendance of each Director at the meeting of the Board of Directors held during the financial year 2011-12, the last Annual General Meeting and disclosure in respect of number of companies and Committees in which each of the Directors of the Company is a member or Chairman, are as follows:

17

Annual Report 2011-12SaberoName of the Director

Category of Directorship

Attendance in Board Meeting

Attendance in last AGM

held

No. of Directorship and Committee Membership in Other Public Companies(other than SABERO) #

BoardDirectorship

Committee Membership

(including Chairmanship)

Committee Chairmanship

Mr. M. K. Tandon 1 NE/ID 6 NO 4 6 4Mr. V. Ravichandran 1 NE/NID 4 NO 4 4 NilMr. Jayesh Gandhi 2 NE/ID 3 N.A. 2 2 1Mr. Sujal Shah 2 NE/ID 4 N.A. 9 8 5Mr. M. M. Venkatachalam 3 NE/NID 2 N.A. 11 2 1Mr. Kapil Mehan 3 NE/NID 3 N.A. 2 Nil NilMr. G. Veera Bhadram 4 WTD/NID 4 N.A. 1 Nil NilMr. Rajesh Sharma 5 WTD/NID Nil N.A. Nil Nil NilMr. C. M. Ashok Muni 6 WTD/NID 3 YES Nil Nil NilMr. John R. English 7 NE/ID Nil NO Nil Nil NilMr. Raj Tandon 7 NE/ID 5 NO Nil Nil NilMr. Kishore Dudani 7 NE/ID 5 YES Nil Nil NilMr. Hero J. Chuganee 8 NE/NID 7 YES Nil Nil NilDr. Mahendra S. Kothari 8 NE/ID 7 YES Nil Nil NilMr. Mohit H. Chuganee 9 MD/NID 7 YES Nil Nil NilMr. Sumit H. Chuganee 10 WTD/NID 8 YES Nil Nil Nil

1. Appointed as an Additional Director w.e.f. 11th July, 2011.2. Appointed as an Additional Director w.e.f. 2nd December, 2011.3. Appointed as an Additional Director w.e.f. 19th December, 2011.4. Appointed as Additional and Whole-time Director w.e.f. 19th December, 2011.5. Resigned as Whole-time Director of the Company w.e.f 7th September, 2011.6. Appointed as Whole-time Director w.e.f. 7th September, 2011 and Resigned as Whole-time Director w.e.f. 19th December, 2011.7. Resigned as Director of the Company w.e.f. 30th November, 2011.8. Resigned as Director of the Company w.e.f. 2nd December, 2011.9. Resigned as Managing Director w.e.f. 17th December 2011 & Resgined as a Director of the Company w.e.f.19th December, 2011.10.Resigned as Whole-time Director w.e.f. 17th December 2011 & Resgined as a Director of the Company w.e.f.19th December, 2011.

# Represents Directorships/Memberships of Audit and Investors’ Grievance Committee of Public Limited Companies governed by Companies Act, 1956.MD/NID = Managing Director/Non-Independent DirectorNE/ID = Non-Executive/Independent DirectorNE/NID = Non-Executive/Non-Independent DirectorWTD/NID=Whole time Director/Non -Independent Director

Details of Board Meeting held during the financial year 2011-12:

Date of Board Meeting

27-05-2011 17-06-2011 11-07-2011 12-08-2011 07-09-2011 14-11-2011 02-12-201119-12-2011 06-01-2012 20-01-2012 20-03-2012

Board Strength

8 8 10 10 11 10 9 10 7 7 7

No. of Directors attended

6 6 4 7 6 7 5 10 5 6 6

18

SaberoIII. CODE OF CONDUCT:

The Company has adopted a Code of Conduct for the members of the Board and the senior management team in compliance with the provisions of Clause 49 of the Listing Agreement.

All the members of the Board and the senior management have affirmed compliance to the Code of Conduct as on 31st March, 2012 and a declaration to that effect signed by the President & Whole-time Director is attached and forms a part of this Report.

IV. BOARD COMMITTEES:

To enable better and more focused attention on the affairs of the Company, the Board delegates specific matters to Committees of the Board set up for the purpose.

Currently, the Board has three Committees viz. Audit Committee, Remuneration Committee and Share Transfer and Investors Grievance Committee. The Board is responsible for the Constitution, co-opting and fixing the terms of reference for said Committees.

Draft minutes of the Committee meetings duly initialed by the Chairman of the respective Committee meeting is circulated to the members of that Committee for their comments and thereafter, confirmed in its next meeting. The Board of Directors also take note of the minutes of the meetings of the Committees, at their Meeting.

1) AUDIT COMMITTEE:

(a) Primary Objectives of the Audit Committee

The Audit Committee of the Board of Directors of the Company inter-alia provides assurance to the Board on the adequacy of the internal control systems and financial disclosures.

As required under Section 292A of the Companies Act, 1956 read with the provisions of Clause 49 of the Listing Agreement(s) with the Stock Exchange(s), the Board has constituted an Audit Committee (the “Committee”). The Committee acts as a link between the Statutory Auditors and the Board of Directors. It addresses itself to matters pertaining to adequacy of internal controls, reliability of financial statements and other management information and adequacy of provisions of liabilities. The primary objective of the “Committee” is to monitor and provide effective supervision of the management’s financial reporting process with a view to ensure accurate, timely and proper disclosures and the transparency, integrity and quality of financial reporting.

The terms of reference of the Audit Committee are as outlined in Clause 49 of the Listing Agreement and Section 292A of the Companies Act, 1956.

(b) Scope of the Audit Committee

1. Provide an open avenue of communication between the independent auditor and the Board of Directors (“BOD”).

2. Recommending the appointment of statutory auditors, fixation of audit fees and also to approve the payment for other services.

3. Meet four times a year or more frequently as circumstances require. The Audit Committee may ask members of management or others to attend meetings and provide pertinent information as necessary.

4. Confirm and assure the independency of the external auditor.

5. Review with Independent Auditor the co-ordination of audit efforts to assure completeness of coverage, reduction of redundant efforts and the effective use of all audit resources.

6. Consider and review with the Independent Auditor for the adequacy of internal controls including the computerized information system controls and security.

7. Reviewing with the management, the quarterly financial statements before submission to the Board for approval.

8. Reviewing with the management the annual financial statements before submission to the Board, focusing primarily on:

(a) Any changes in the accounting policies and practices,

(b) The going concern assumption,

(c) Compliance with Accounting Standards,

(d) Compliance with stock exchange and legal requirements concerning financial statements, and;

(e) Significant adjustment arising out of audit.

19

Annual Report 2011-12Sabero9. Consider and review with the management

and the independent auditor:

(a) Significant findings during the year, including the status of previous audit recommendations, and;

(b) Any difficulties encountered in the course of audit work including any restrictions on the scope of activities or access to required information.

10. Review of the following information:

(a) Management discussion and analysis of financial condition and results of operations;

(b) Statement of significant related party transactions submitted by the management.

(c) Management letter / letters of internal control weaknesses issued by the Statutory Auditors.

(c) Composition of the Audit Committee as on 31st March, 2012

The Audit Committee currently comprises of three Non-Executive Directors as members out of which two are Independent Directors. Mr. M. K. Tandon, an Independent Director acts as the Chairman of the Committee. The Statutory Auditors are invited to the Audit Committee Meetings.

Consequent to the change in management of the Company, the Audit Committee was reconstituted w.e.f. 19th December, 2011.

The Audit Committee comprises of the following members as on 31st March, 2012.

Sr. No

Name of the Member Position

1 Mr. M. K. Tandon Chairman

2 Mr. V. Ravichandran Member

3 Mr. Jayesh Gandhi Member

(d) Audit Committee Meetings and Attendance during the financial year ended 31st March, 2012

During the Financial Year 2011-12, 5 meetings of the Audit Committee were held

i.e. on 27th May, 2011, 12th August, 2011, 14th November, 2011, 20th January, 2012 and 20th March, 2012. The table hereunder gives the attendance record of members of Audit Committee.

Name of the Member Number of Meetings attended

during the year

Mr. M. K. Tandon 2

Mr. V. Ravichandran 2

Mr. Jayesh Gandhi 2

Mr. Mahendra Kothari* 3

Mr. Raj Tandon** 3

Mr. Hero Chuganee* 3

* Resigned as Director of the Company w.e.f. 2nd December, 2011.

** Resigned as Director of the Company w.e.f. 30th November, 2011.

2) Remuneration Committee:

The broad terms of reference of the Remuneration Committee is to ensure that the remuneration practices of the Company in respect of the Senior Executives including the Executive Director are competitive keeping in view prevalent compensation packages so as to recruit and retain suitable individual(s) in such capacity.

Consequent to the change in Management of the Company, the Remuneration Committee was reconstituted w.e.f. 19th December, 2011 with the induction of two Independent Directors viz. Mr. M. K. Tandon and Mr. Jayesh Gandhi and one Non-Executive Director Mr. M. M. Venkatachalam. Further, Mr. Sujal Shah – Independent Director was inducted as Member on the said Committee w.e.f. 20th January, 2012.

a) Composition of the Committee:

The Remuneration Committee comprises of the following members as on 31st March, 2012.

Sr. No

Name of the Member Position

1 Mr. M. K. Tandon Chairman

2 Mr. Jayesh Gandhi Member

3 Mr. M. M. Venkatachalam Member

4 Mr. Sujal Shah Member

20

Saberob) Details of Committee Meetings and

attendance:

During the Financial Year 2011-12, the Remuneration Committee met 3 times on 7th September, 2011, 19th December, 2011 and 20th January, 2012. The table hereunder gives the attendance record of the Remuneration Committee members:

Name of the Member Number of meeting attended

Mr. M. K. Tandon 2Mr. Jayesh Gandhi 2Mr. M. M. Venkatachalam 1Mr. Sujal Shah 1Mr. Mahendra Kothari* 1Mr. Raj Tandon** 1Mr. Kishore Dudani** 1

* Resigned as Director w.e.f. 2nd December, 2011

** Resigned as Director w.e.f. 30th November, 2011

(c) Remuneration Policy:

The compensation of the Executive Directors comprises of fixed component and a performance incentive. The compensation is determined based on levels of responsibility and scales prevailing in the industry. The performance incentive is determined based on certain pre-agreed performance parameters. The Executive Directors are not paid sitting fees for any Board / Committee meetings attended by them.

The Non-Executive Directors are paid sitting fees for attending each meeting of the Board, Audit Committee, Remuneration Committee and Share Transfer and Investors Grievance Committee.

The appointment and payment of remuneration of Executive Directors is recommended by the Remuneration Committee, approved by the Board and also by the shareholders of the Company. Their appointment is governed by respective resolutions passed by the Board of Directors and shareholders of the Company, which covers terms of such appointment, read with the service rules of the Company.

Details of Remuneration paid to Executive Directors for the financial year ended 31st March, 2012 are as under:

(` in Lacs)Name of the

Director

Designation Period@ Salary & Allow-

ances

Retrial benefits

Contri-bution

to Provi-dent Fund

Perqu-isites

Total

Mr. G. Veera Bhadram

President & Whole-time Director

19th December, 2011 to 31st March, 2012

13.68 - 1.75 0.05 15.48

Mr. Mohit Chuganee

Vice Chairman & Managing Director

1st April, 2011 to 17th

December, 2011

42.40 57.20 3.18 1.10 103.88

Mr. Sumit Chuganee

Executive Vice Chairman & Whole-time Director

1st April, 2011 to 17th December, 2011

42.40 52.39 3.18 0.63 98.60

Mr. Rajesh Sharma

Whole Time Director & Chief Operating Officer

1st April, 2011 to 7th September, 2011

16.47 3.67 0.87 - 21.01

Mr. C. M. Ashok Muni

Whole-time Director & Chief Executive Officer

7th September, 2011 to 19th December, 2011

15.10 - - 0.11 15.21

@ It denotes period for which remuneration drawn by Executive Directors during the period under review.

Details of Sitting fees paid to Non-Executive Directors for the financial year ended 31st March, 2012 are as under:

Non-Executive Directors

(` In Lacs) Name of the Directors Sitting Fees paid for the

financial year 2011-12Mr. M. K. Tandon 0.66Mr. V. Ravichandran 0.46Mr. M. M. Venkatachalam 0.20Mr. Kapil Mehan NilMr. Sujal Shah 0.40Mr. Jayesh Gandhi 0.36Mr. Kishore Dudani 0.50Mr. Raj Tandon 0.59Mr. Mahendra Kothari 0.79Mr. Hero Chuganee NilMr. John R. English NilMr. Mohit Chuganee 0.10Mr. Sumit Chuganee 0.10

21

Annual Report 2011-12SaberoShares held by Non-Executive Directors:

Name of the Non-ExecutiveDirector

Equity Shares held (Nos.)

Mr. Hero Chuganee*@ NilMr. Raj Tandon** 100Dr. Mahendra S. Kothari* NilMr. John R. English** 62390Mr. Kishore Dudani** NilMr. M. K. Tandon NilMr. M. M. Venkatachalam NilMr. Jayesh Gandhi NilMr. Sujal Shah NilMr. Kapil Mehan NilMr. V. Ravichandran Nil

* Resigned as Director w.e.f. 2nd December, 2011

** Resigned as Director w.e.f. 30th November, 2011

@ Pursuant to Share Purchase Agreement dated 30th May, 2011, entered into with Coromandel International Limited (Coromandel) by Promoter and Promoter Group, Mr. Hero Chuganee has sold 2961755 Equity Shares on 23rd June, 2011 to Coromandel.

3) Share Transfer and Investors Grievance Committee:

Prior to the change in Management of the Company, there were two committees in existance viz. Share Transfer Committee and Shareholders/Investors Grievance Committee. Details of meetings and attendance are as under:

Shareholders/Investors Grievances Committee during the financial year 2011-12 under review met 3 times on 27th May, 2011, 12th August, 2011, 14th November, 2011.

Name of the Member No. of Meetings Attended

Mr. Raj Tandon* 3

Mr. Rajesh Sharma** Nil

Mr. Kishore Dudani* 3

*Resigned w.e.f. 30th November, 2011

** Resigned w.e.f. 7th September, 2011

During the year under review, Share Transfer Committee met on fortnightly basis and also as per requirement. Mr. Hero Chuganee,Mr. Mohit H. Chuganee and Mr. Sumit Chuganee were members of said Committee.

After the change in Management Share Transfer Committee was reconstituted w.e.f. 19th December, 2011 and Mr. Sujal Shah, Mr. Kapil Mehan and Mr. G. Veera Bhadram were inducted as members of said Committee. Taking into consideration functionality of Share Transfer Committee and Shareholders/ Investors’ Grievance Committee, both the Committees were merged and one committee was constituted w.e.f. 20th January, 2012, named as Share Transfer and Investors Grievance Committee.

(a) Scope of the Share Transfer and Investors Grievance Committee:

The Share Transfer and Investors Grievance Committee, inter-alia, deals with various matters like share transfers, transmissions, issue of duplicate share certificates, approve the remat requests, request for consolidation of shares as and when received, and to generally deal with all investors related matters and redress the grievances of investors if any.

(b) Composition of the Committee:

Share Transfer and Investors Grievance Committee consist of three Directors out of which, two are Non-Executive Directors and one is Executive Director. Out of two Non-Executive Director one is Independent Director.

The Share Transfer and Investors Grievance Committee comprises of the following members as on 31st March, 2012:

Name of the Member DesignationMr. Jayesh Gandhi ChairmanMr. Kapil Mehan MemberMr. G. Veera Bhadram Member

(c) Meetings and Attendance:

During the year under review, Share Transfer and Investors Grievance Committee met once on 20th March, 2012. Details of attendance of said committee Meeting are as under:

Name of the Member No. of Meetings Attended

Mr. Jayesh Gandhi 1

Mr. Kapil Mehan Nil

Mr. G. Veera Bhadram 1

Details of Shareholders’ complaints received, solved and pending during the Financial Year ended 31st March, 2012:

The total numbers of complaints received and replied to the satisfaction of the shareholders during the year ended March 31, 2012 were 40; there were no pending/unattended complaints as on March 31, 2012.

22

SaberoNature of complaints received and attended to during 2011-2012

Nature of complaint Pending As on

01.04.11

ReceivedDuring

the year

ResolvedDuring

the year

Pending As on

31.03.12Non-receipt of Warrant Dividend/ Interest/ Redemption Warrant

Nil 18 18 Nil

Non-receipt of Refund Order Nil Nil Nil NilNon Receipt of Demat Credit/ Remat Certificate

Nil 2 2 Nil

Non Receipt of Annual Report Nil Nil Nil NilNon-Receipt of Share Certificate Nil 13 13 NilNon Receipt of Rep/ Spl/Con/Dup Nil 2 2 NilNon Receipt of Redemption Amount

Nil 1 1 Nil

Non Receipt of End Stickers Nil Nil Nil NilNon Receipt of Exchange Certificate

Nil Nil Nil Nil

Dematerialisation/ Rematerialisation of Shares

Nil 1 1 Nil

Others Nil 3 3 NilComplaints received from:• Securities and Exchange

Board of IndiaNil Nil Nil Nil

• Stock Exchange Nil Nil Nil Nil• Registrar of Companies /

Department of Company Affairs

Nil Nil Nil Nil

• Legal Nil Nil Nil NilTotal Nil 40 40 Nil

V. Subsidiary Companies

The Company does not have any unlisted Indian subsidiary Company.

VI. General Body Meetings:

Details of last three Annual General Meetings are given hereunder

Year Date Venue Time2008-2009 24.09.2009 The Umbergaon Club,

Madhuvan Complex, Umbergaon-Sanjan Road, Umbergaon-396171, Dist: Bulsar, State: Gujarat

11.00 A.M.

2009-2010 28.09.2010 The Umbergaon Club, Madhuvan Complex, Umbergaon-Sanjan Road, Umbergaon-396171, Dist: Bulsar, State: Gujarat

11.00 A.M.

2010-2011 29.09.2011 The Umbergaon Club, Madhuvan Complex, Umbergaon-Sanjan Road, Umbergaon-396171, Dist: Bulsar, State: Gujarat

11.00 A.M.

Special Resolutions passed in the last three Annual General Meetings (AGM):

For 2008-2009

1) Alterations to the Articles of Association of the Company.

2) Voluntary delisting of securities from five stock exchanges viz. Vadodara Stock Exchange Ltd., the Calcutta Stock Exchange Association Ltd., Delhi Stock Exchange Ltd, Ahmedabad Stock Exchange Ltd and Hyderabad Securities And Enterprises Ltd.

For 2009-10

1) Appointment of Mr. Hero Chuganee as Technical Consultant of the Company w.e.f. 17-04-2010 for a period of three years.

2) Re-appointment of Mr. Mohit Chuganee as Vice Chairman & Managing Director of the Company w.e.f. 01-08-2010 for a period of three years.

For 2010-11

There was no special resolution passed in the Annual General Meeting held for the financial year 2010-2011.

Special Resolution passed in Extra-Ordinary General Meetings (EGM) held in last three financial years:

For 2009-10

1) Increase in Authorised Share Capital from Rs.31 Crore to Rs. 36 Crore and consequently alteration of Clause V of the Memorandum of Association and Article 3 (1) of Article of Association of the Company.

2) Issue of 55,80,000 Optionally Fully Convertible Warrants to the Promoters, Person acting in concert and other than promoters.

No Extra-Ordinary General Meeting was held during the financial year 2008-2009 and 2010-2011.

Postal Ballot:

During the financial year 2011-12, on 19th March, 2012 Five Special Resolutions by way of Postal Ballot were passed for seeking approval of members for:

a) the terms of appointment of Mr. G. Veera Bhadram as President & Whole-time Director of the Company including remuneration to be paid to him;

b) the terms of appointment of Mr. Sumit Chuganee the then Whole-time Director and Executive Vice Chairman for the period from 1st April, 2011 to 17th December, 2011, including remuneration paid to him;

23

Annual Report 2011-12Saberoc) the terms of appointment of Mr. Mohit H.

Chuganee the then Managing Director and Vice Chairman for the period from 1st April, 2011 to 17th December, 2011, including remuneration paid to him;

d) the terms of appointment of Mr. Rajesh Sharma the then Whole-time Director and Chief Operating Officer of the Company for a period from 1st April, 2011 to 7th September, 2011 including remuneration paid to him and

e) the terms of appointment of Mr. C. M. Ashok Muni the then Whole-time Director and Chief Executive Officer of the Company for a period from 7th September, 2011 to 19th December, 2011 including remuneration paid to him.

VII. DISCLOSURES:

(a) Related Party Transactions:

There are no transactions of material nature with Directors/Promoters or any related entity, which will have any potential conflict with the interests of the Company at large except the transactions mentioned under the Section of Notes to Accounts which forms a part of the Auditors’ Report for the year ended 31st March, 2012.

(b) Compliance :

A Statement of Compliance with all Laws and Regulations as certified by the Whole-Time Director and Company Secretary is placed at periodic intervals for review by the Board. The Board reviews the compliance of all the applicable Laws and gives appropriate directions wherever necessary.

(c) CEO and CFO Certification:

The President & Whole-time Director and Chief Financial Officer has given a Certificate to the Board as contemplated in Clause 49 of the Listing Agreement.

(d) Compliance with the Mandatory requirements and Implementation of the Non-mandatory requirements:

The Company has complied with the mandatory requirements of the Corporate Governance Clause of Listing Agreement. The Company has also implemented some of the non-mandatory requirements like consitution

of Remuneration Committee and putting in place Whistle Blower Policy enumerated in Clause 49 of the Listing Agreement.

VIII. MEANS OF COMMUNICATION:

a. Half-yearly report sent to each shareholders

No*

b. Quarterly results Published in

Western Times(Eng+Guj) Ahmedabad EditionFree Press Journal+ Navshakti-Mumbai Edition

c. Website where displayed

www.sabero.com

d. Whether the website also displays official news releases and presentations to the media, analysts, institutional investors’ etc.

No such event occurred during the year**

e. Audited financial results

Western Times(Eng+Guj) Ahmedabad EditionFree Press Journal+ Navshakti-Mumbai Edition

f. Whether MD&A (Management Discussion & Analysis) is a part of Annual Report?

Yes

* As the results are published in newspapers having wide circulation and also displayed on the Company’s website, half yearly results are not sent separately to each shareholder.

** No presentations were made to the institutional investors or to analysts during the year under review.

IX. CERTIFICATE ON CORPORATE GOVERNANCE:

As required by Clause 49 of the Listing Agreement, a certificate issued by M/s. Rathi & Associates, Practicing Company Secretaries, regarding compliance with Corporate Governance norms is given as an annexure to this Report.

24

SaberoX. CEO DECLARATION:

As required by Clause 49 of the Listing Agreement, the CEO i.e. the President and Whole-time Director’s declaration on compliance of the Company’s Code of Conduct is provided as an annexure to this Report.

XI. GENERAL SHAREHOLDERS’ INFORMATION:

1. Annual General Meeting of Shareholders:

Date 13th July, 2012

Day & Time Friday, 12:30 p.m.

Venue Plot No. 2102, GIDC, Sarigam - 396 155, Dist. - Bulsar, Gujarat.

2. Financial Calendar(tentative and subject to change)

Financial Reporting for quarter ended:

June 30, 2012 14th August 2012

September 30, 2012 14th November 2012

December 31, 2012 14th February 2013

March 31, 2013 30th May, 2013

Annual GeneralMeeting for yearended 31st March 2013

30th September 2013

3. Dates of book closures

6th July 2012 to 13th July, 2012 (both days inclusive)

4. Registered Office Plot No. 2102, GIDC, Sarigam -396155,Dist: Bulsar, Gujarat

5. Listing on Stock Exchangesa. Stock Exchange Bombay Stock Exchange Limited

The National Stock Exchange of India Limitedb. Depository Central Depository Services (India) Ltd. and

National Securities Depository Ltd.6. Stock Exchange Code a. Bombay Stock Exchange Limited :524446

b. The National Stock Exchange Limited: SABERORGAN

7. Demat ISIN No. inNSDL & CDSL

INE243A01018

8. Listing fees Paid for financial year 2012-2013

9. Disclosures regarding appointment or re-appointment of Directors:Pursuant to the provisions of Sections 255 & 256 of the Companies Act, 1956, Mr. M. K. Tandon and Mr. V. Ravichandran will be retiring by rotation at the ensuing Annual General Meeting. The Board has recommended the re-appointments of the said Directors to the shareholders. The detailed resume of Directors proposed to be re-appointed

is provided in the Notice of the ensuing Annual General Meeting of the Company.Pursuant to Section 257 of the Companies Act, 1956, Notices have been received from the shareholders of the Company, proposing candidature of Additional Directors viz. Mr. M. M. Venkatachalam, Mr. Jayesh Gandhi, Mr. Sujal Shah, Mr. Kapil Mehan and Mr. G. Veera Bhadram for their respective appointment as Director at the ensuing Annual General Meeting. The detailed resume of Additional Directors to be appointed as Director is provided in the Notice of the Annual general Meeting.

10. Stock Market Price Data:A. Bombay Stock Exchange Limited Monthly High and Low of Closing prices of the

Company’s Equity Shares traded at Bombay Stock Exchange Limited for the financial year ended 31st March 2012 is noted below:

Month Sabero BSE

High (`)

Low (`)

Sensex (High)

Sensex (Low)

April 2011 63.2 47 19811.14 18976.19May 2011 97.9 55.25 19253.87 17786.13June 2011 130.5 107.65 18873.39 17314.38July 2011 133 126 19131.7 18131.86August 2011 131.35 115.3 18440.07 15765.53September 2011 126 118 17211.8 15801.01October 2011 123.3 118 17908.13 15745.43November 2011 130 120 17702.26 15478.69December 2011 125.65 52.9 17003.71 15135.86January 2012 65.9 55.55 17258.97 15358.02February 2012 91.95 62 18523.78 17061.55March 2012 78.1 68.8 18040.69 16920.61

Performance in comparison to BSE Sensex:

Sabero High

BSE SENSEX High

140120100806040200

20000

15000

1000

5000

0

Monthly-High-Low Share Price / BSE SENSEX

Pri

ce o

f S

hare

s

BS

E S

EN

SE

X

Sabero Low

BSE SENSEX Low

Month

Mar’12

Feb’12

Jan’12

Dec’11

Nov’11

Oct’11

Sep’11

Aug’11

Jul’11

Jun’11

May’11

Apr’11

25

Annual Report 2011-12SaberoB. The National Stock Exchange of India Limited

Monthly High and Low of Closing prices of the Company’s Equity Shares traded at National Stock Exchange of India Limited for the financial year ended 31st March 2012 is noted below:

Sebro NSE NiftyMonth High

(`)Low

(`)(High) (Low)

April 2011 63.1 47 5944.45 5693.25May 2011 98.35 55.1 5775.25 5328.7June 2011 130.9 108.2 5657.9 5195.9July 2011 133.95 126.5 5740.4 5453.95August 2011 132.4 115.2 5551.9 4720September 2011 126.05 117.05 5169.25 4758.85October 2011 124.95 118.4 5399.7 4728.3November 2011 131.9 119.1 5326.45 4639.1December 2011 126 52.95 5099.25 4531.15January 2012 65.95 55 5217 4588.05February 2012 91.8 61 5629.95 5159March 2012 78.4 68.5 5499.4 5135.95

Performance in comparison to NSE Nifty:

11. Registrar and Share Transfer Agents:

For both Physical and Demat (Common Registry) Link Intime India Private Limited

C-13, Pannalal Silk Mills Compound,LBS Marg, Bhandup (West), Mumbai-400078Tel: 022 25963838Fax: 022-25946969Website: www.linkintime.co.in

12. Share Transfer System:All requests received for transfer of shares are processed and approved by the Share Transfer & Investors Grievance Committee at its meeting or by way of circular resolution.

13. DISTRIBUTION OF SHAREHOLDING

A) Distribution of Shareholding as on 31st March, 2012 is noted below:

No. of Shares No. of Share-

holders

% to total Share-

holders

Share Amt.(`

% to Total Holdings

1-500 12723 91.3680 17359990 5.1261

501-1000 621 4.4596 5152090 1.5213

1001-2000 293 2.1041 4492150 1.3264

2001-3000 90 0.6463 2269640 0.6702

3001-4000 36 0.2585 1316010 0.3886

4001-5000 52 0.3734 2510170 0.7412

5001-10000 58 0.4165 4173160 1.2323

10000 & above 52 0.3734 301387560 88.9939

Total 13925 100.00 338660770 100.00

B) Shareholding Pattern as on 31st March, 2012 is noted below:

Category No. of Shares Percentage (%)Promoters 2,52,68,287 74.61

Mutual Funds, Banks and FIIs

9,91,642 2.93

Indian Public 43,17,345 12.75

NRIs/OCBs/Foreign Company/Foreign National

28,58,393 8.44

Trusts 10,000 0.03

Private Corporate Bodies 3,73,166 1.10

Clearing Members 47,244 0.14

Total 3,38,66,077 100

14. Dematerialisation of Shares and liquidity:

The shares of the Company are in compulsory demat segment and are available for trading in the depository systems of both NSDL and CDSL under ISIN No.INE243A01018. As on 31st March, 2012, 32,996,174 Equity Shares of the Company, forming 97.44% of the Share Capital of the Company, stand dematerialized.

15. Outstanding GDR’s /ADR’s /Warrants or any Convertible Instruments, conversion date and likely impact on Equity:

There are no GDR’s / ADR’s / Warrants or any convertible instruments pending conversion or any other instrument likely to impact the Equity Share Capital of the Company.

140.00120.00100.00

80.0060.0040.0020.00

0.00

6000

5000

4000

3000

2000

1000

0

Sabero High

NSE SENSEX High

Monthly-High-Low Share Price / NSE NIFTY

NS

E N

IFT

Y

Pri

ce o

f S

hare

s

Sabero Low

NSE SENSEX Low

Month

Mar’12

Feb’12

Jan’12

Dec’11

Nov’11

Oct’11

Sep’11

Aug’11

Jul’11

Jun’11

May’11

Apr’11

26

SaberoXII. PLANT LOCATION:

a) Plot No. 2102, GIDC, Sarigam-396 155, Dist: Bulsar, Gujarat

b) Plot No.2/103/G, Dahej SEZ-II, Taluka-Vagra, Dist: Bharuch, Gujarat.

XIII. ADDRESS FOR CORRESPONDENCE:Registrar and Transfer Agent (share transfer and communication regarding share certificates, dividends and change of address)

Link Intime India Private LimitedC-13, Pannalal Silk Mills Compound,LBS Marg, Bhandup (West), Mumbai-400078Tel: 022 25963838Fax: 022-25946969Website: www.linkintime.co.in

Compliance Officer

Ms. Pritam VartakBezzola Commercial Complex, A Wing, 3rd Floor, Suman Nagar, Sion Trombay Road, Mumbai-400071Tel No.: 022-61132400/440Fax:022-61132405

XIV. UNCLAIMED SHARES

As per Clause 5A of the amended Equity Listing Agreement with the Stock Exchanges, all physical shares, which remain unclaimed by shareholders, need to be demated by the Company and kept in an “Unclaimed Suspense Account” to be opened by the Company for this purpose. As per the clause, the Company is required to send three reminders to the respective shareholders before transferring the physical shares to the “Unclaimed Suspense Account”. The Company is in the process of sending reminder letters to such shareholders to claim their respective shares. After sending the third reminder, the Company would transfer the remaining unclaimed shares into the “Unclaimed Suspense Account”. All corporate benefits that accrue on these shares such as bonus shares, split etc. shall also be credited to the Unclaimed Suspense Account and the voting rights on such shares shall remain frozen. Shareholders who are in receipt of the reminder letters are requested to write to the Registrars and Transfer Agents and provide the correct details to enable the Company to re-send the share certificates. These shares would be, thereafter transferred to the respective shareholders as and when claimed by them.

XV. REQUEST TO INVESTORS:

a) Investors are requested to communicate change of address, if any, directly to the Share Transfer Agent of the Company at the above address.

b) The Shareholders are requested to dematerialise their physical Share certificates, through a depository participant. Shareholders requiring any further clarification / assistance on the subject may contact the Company’s Share Transfer Agent.

c) Investors who have not availed nomination facility are requested to avail the same by submitting the nomination form. The form will be made available on request.

d) Investors holding Shares in electronic form are requested to deal only with their Depository Participant in respect of change of address, nomination facility and furnishing Bank account number etc.

e) Investors are requested to kindly note that any dividend which remains unencashed for a period of seven years will get transferred to “Investors Education and Protection Fund” in terms of Section 205C of the Companies Act, 1956.

XVI. NON-MANDATORY REQUIREMENTS

a) Remuneration Committee:

The Board has constituted a Remuneration Committee with four Non-executive Directors out of which three are Independent Directors. The Committee reviews and recommends to the Board the remuneration package to the Executive Directors.

b) Whistle Blower Policy:

The Company has adopted a Whistle Blower Policy and has put in place of suitable mechanism to provide an avenue to raise concerns. The mechanism provides for adequate safeguards against victimization of employees who avail of it and also appointed an Ombudsperson to deal with any complaints received. The policy also lay down the process to be followed for dealing with complaints and in exceptional cases, also provides for direct appeal to the Chairperson of the Audit Committee.

Place : MumbaiDate : 18.04.2012

For Sabero Organics Gujarat Limited.

Sd/-M. K. Tandon

Chairman

REGISTERED OFFICE:Plot No. 2102, GIDC, Sarigam-396155,Dist: Bulsar, Gujarat

27

Annual Report 2011-12SaberoPRACTICING COMPANY SECRETARIES’ CERTIFICATE ON CORPORATE

GOVERNANCE UNDER CLAUSE 49 OF THE LISTING AGREEMENT

To,The Members ofSabero Organics Gujarat Limited.

We have examined the compliance of conditions of Corporate Governance by Sabero Organics Gujarat Limited (“the Company”) for the year ended March 31, 2012, as stipulated in Clause 49 of the Listing Agreement of the said Company with the Stock Exchange.

The compliance of conditions of Corporate Governance is the responsibility of the management. Our examinations were 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 financial 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 Agreement.

As per the records of the Company, there were no investor grievances remaining unattended for a period exceeding one month against the Company.

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

For and on behalf of M/s. Rathi & Associates

Company Secretaries

Sd/-Place: Mumbai Jayesh Shah Date: 18.04.2012 Partner FCS No.:5637

CEO DECLARATIONDECLARATION REGARDING COMPLIANCE BY BOARD MEMBERS AND SENIOR MANAGEMENT PERSONNEL WITH THE COMPANY’S CODE OF CONDUCT

Pursuant to Clause 49 l (D) of the Listing Agreement entered into with the Stock Exchange, I hereby declare that all the Board members and senior management personnel of the Company have affirmed compliances with the Code of Conduct for the year ended 31st March, 2012

Sd/-Place: Mumbai G. Veera BhadramDate: 18.04.2012 President & Whole-time Director

28

SaberoAUDITORS’ REPORT

The MembersSabero Organics Gujarat Limited

We have audited the attached Balance Sheet of Sabero Organics Gujarat Limited, as at 31st March 2012 and the Statement of Profit and Loss Account and also the Cash Flow Statement for the year ended on that date annexed thereto. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audit.

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

2. In our opinion and as per the information and explanations given to us, the Companies (Auditor’s Report) Order, 2003, as amended by the Companies (Auditor’s Report) (Amendment) Order, 2004 issued by the Central Government in terms of Section 227 (4A) of the Companies Act, 1956, we enclose in the Annexure a statement on the matters specified in the paragraphs 4 and 5 of the said Order, to the extent applicable to the company during the year under review.

3. Further to our comments in the Annexure referred to in Para 2 above, we report that:

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

ii. 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;

iii. The Balance Sheet Statement of Profit and Loss Account and Cash Flow Statement, dealt with by this report are in agreement with the books of account;

iv. In our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred in sub-section (3C) of Section 211 of the Companies Act, 1956;

v. On the basis of written representations received from the directors as on 31st March, 2012 and taken on record by the Board of Directors, we report that none of directors is disqualified as on 31st March, 2012 from being appointed as director in terms of clause (g) of sub-section (1) of section 274 of the Companies Act, 1956;

vi. In our opinion and to the best of our information and according to the explanations given to us, the said accounts, read together with Significant Accounting Policies and Notes on Accounts in Note-23 give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

a) In case of the Balance Sheet, of the State of Affairs of the Company as at 31st March, 2012;

b) In case of the Statement of Profit and Loss Account, of the Loss of the Company for the year ended on that date; and

c) In the case of Cash Flow Statement, of the cash flows of the Company for the year ended on that date.

For S M N P & CoChartered Accountants

Registration No. – 105929 W

Sd/-Sunil S Dayma

Partner Membership No. F-100542

Place : MumbaiDate : 18th April 2012

29

Annual Report 2011-12Sabero

In terms of the information and explanation given to us and the books and records examined by us and on the basis of such checks, as we considered appropriate, we further report as under:

(i) Fixed Assets:

a) In our opinion, the Company has maintained proper records pertaining to fixed assets showing full particulars including quantitative details and situation of fixed assets on the basis of available information.

b) As explained to us, during the year, the fixed assets have been physically verified by an independent agency appointed by the management, the periodicity of which, in our opinion is reasonable. No Material discrepancies were noticed on such physical verification.

c) During the year, the Company has not disposed off substantial part of the fixed assets and the going concern status of the company has not been affected.

(ii) Inventories:

a) During the year, the management has conducted physical verification of inventories, the frequency of which, in our opinion, is reasonable.

b) The procedures of physical verification of inventories followed by the management, in our opinion, 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 inventory. As explained to us, the material discrepancies noticed during the said physical verification had been appropriately dealt with in the books of accounts.

(iii) Loans & Advances either granted or taken

(a) As per the records verified by us, the Company has not taken any loans, secured or unsecured, from the parties covered in the register maintained under section 301 of the Companies Act, 1956.

ANNEXURE TO THE AUDITORS’ REPORT

(b) The Company has, during the year, granted interest-free advances to 3 bodies corporate being parties covered in the register maintained under Section 301 of the Companies Act, 1956 in addition to an interest-free advance given in the earlier years to a body corporate. The maximum and closing balance of the said loans are given as under:

(Amount in `)

Nature and number of the Parties

Maximum balance

during the year

Closing balance

Bodies Corporate – 3 24.83 24.83

(c) In our opinion, the other terms and conditions of the above advances are not prima facie prejudicial to the Company’s interests.

(d) Based on the information and explanations provided to us, in our opinion, the parties to whom the above loans were given are (i) regular in repayment of principal and interest, as applicable (ii) there was no overdue principal as at the close of the year and (iii) reasonable steps were taken by the Company to recover the loans.

(iv) Internal Controls:

In our opinion, there are adequate internal control procedures commensurate with the size of the Company and the nature of its business, for the purchase of inventory and fixed assets and for sale of goods. There is no continuing failure to correct major weakness in internal control.

(v) Transactions covered by Section 301 of the Companies Act,1956:

a) In our opinion, transactions entered with the parties listed in the Register maintained under section 301 of the Companies Act, 1956 have been so entered.

b) In our opinion, the transactions entered in the said Register in respect of each party during the year, have been made at prices which are reasonable, having regard to the prevailing market prices at the relevant time, wherever such market prices are available.

(Referred to in paragraph 2 of our report of even date on the Financial Statements for the year ended 31st March 2012 of Sabero Organics Gujarat Limited)

30

Sabero(vi) Public Deposits:

During the year, the Company has not accepted any deposits from the public under the directives issued by the Reserve Bank of India and the provisions of Sections 58A and 58-AA or any other relevant provisions of the Companies Act, 1956.

(vii) Internal Audit:

In our opinion, the present scope and coverage of the Internal Audit needs to be further strengthened to make the same commensurate with the size of the Company and the nature of its business.

(viii) Cost Records:

The Central Government has prescribed maintenance of cost records under clause (d) of section (1) of section 209 of the Companies Act, 1956. We have broadly reviewed the accounts and records of the Company in this connection and are of the opinion, that prima facie, the prescribed accounts and records have been made and maintained. We have, however, not made a detailed examination of the records with a view to determine whether they are accurate or complete.

(ix) Statutory Dues:

a) As per the records verified by us, the Company is generally regular in depositing undisputed statutory dues including Provident Fund, investor education and protection fund, Employees’ State Insurance, Income Tax, Value Added Tax, Wealth Tax, Custom Duty, Service Tax, Excise Duty, Cess or any other statutory dues with the appropriate authorities which is outstanding for more than six months as at the end of the year.

b) As per the records of the Company, except for the disputed dues aggregating to ` 623.17 Lacs relating to Income Tax, there are no disputed dues relating to investor education and protection fund, employees’ state insurance, Customs duty, Wealth tax, Excise duty and Cess or any other undisputed statutory dues, which were lying pending to be deposited at the year end, for a period of more than six months from the date they became payable. The details of the disputed Income Tax & Value Added Tax due pending before respective authorities are as follows:

Name of Statute Period towhich it pertains

(Assessmentyear)

Tax (`) Forum before which pending

Income Tax Act, 1961 1998-99 307,576

Income Tax Appellate Tribunal

Income Tax Act, 1961 1999-00 307,324

Income Tax Appellate Tribunal

Income Tax Act, 1961 2002-03 7,250,000

Commissioner of Income Tax

Income Tax Act, 1961 2004-05 6,800,000

Commissioner of Income Tax

Income Tax Act, 1961 2005-06 164,748

Commissioner of Income Tax

Income Tax Act, 1961 2006-07 1,683,422 Commissioner of Income Tax applied for rectification u/s 154 of the Income Tax Act, 1961

Income Tax Act, 1961 2007-08 1,651,880 Commissioner of Income Tax

Income Tax Act, 1961 2008-09 97,119 Commissioner of Income Tax

Income Tax Act, 1961 2009-10 29,233,160 Commissioner of Income Tax

Sales Tax Gujarat 2000-01 14,822,262 Dy Commissioner (Appeal)

Total 62,317,491

(x) Accumulated Losses:

The Company does not have accumulated losses as at the end of the financial year. However it has incurred cash losses during the financial year ended on that date, no cash losses were incurred in the preceding financial year.

(xi) Dues to Financial Institutions/Banks:

As per the records verified by us and based on our audit procedures we are of the opinion that the Company has not defaulted in repayment of dues to Financial Institutions or banks.

(xii) Loans against pledge of Securities:

According to the information and explanations given to us the Company has not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.

31

Annual Report 2011-12Sabero(xiii) Chit fund or nidhi/mutual benefit fund:

The Company is not a chit fund or a nidhi/mutual benefit fund/society. Therefore, the provisions of clause 4(xiii) of the Companies (Auditor’s Report) Order, 2003 (as amended) are not applicable to the Company.

(xiv) Trading in shares, securities, debentures and other investments:

In our opinion, the Company does not deal or trade in shares, securities and debentures. Accordingly, the provisions of clause 4(xiv) of the Companies (Auditor’s Report) Order, 2003 (as amended) are not applicable to the Company.

(xv) Guarantees given:

As per the records verified by us and based on the explanations given to us, during the year the Company has not given any guarantee for loans taken by others from bank or financial institutions, the terms and conditions, whereof, are in our opinion prejudicial to the interest of the company.

(xvi) Application of Funds raised:

a) The Company has raised new terms loans during the year. According to the information and explanation given to us, in our opinion, the terms loans outstanding at the beginning of the year and those raised during the year have been applied for the purposes for which they were obtained.

b) Based on the overall examination of the balance sheet of the Company, in our opinion, there are no funds raised on a short term basis which have been used for long term investment.

(xvii) Preferential Allotments of Securities

During the year the Company has not allotted equity shares on preferential basis to a party covered in the Register maintained under Section 301 of the Companies Act 1956.

(xviii) Security against Debentures:

As per the records verified by us, the Company did not have any outstanding debentures during the year.

(xix) Frauds:

As per the records verified by us, no fraud on or by the Company has been noticed or reported during the year that causes the financial statements to be materially misstated.

For S M N P & CoChartered Accountants

Registration No – 105929W

sd/-Sunil S Dayma

PartnerMembership No. F-100542

Place : MumbaiDate : 18th April 2012

32

SaberoBALANCE SHEET AS AT 31, MARCH 2012

(` in lacs) As at As atParticulars Note 31-Mar-12 31-Mar-11

EQUITY AND LIABILITIES

Shareholders’ funds

(a) Share capital 1 3,385.51 3,385.45

(b) Reserves and Surplus 2 3,064.49 9,188.86

Non-current liabilities

(a) Long-term borrowings 3 6,428.31 4,660.35

(b) Deferred tax liabilities (net) 4 - 1,340.58

(c) Long-term provisions 5 132.21 116.12

Current liabilities

(a) Short-term borrowings 6 14,396.61 11,190.49

(b) Trade payables 7 7,538.32 6,181.12

(c) Other current liabilities 8 3,069.02 2,137.06

(d) Short-term provisions 9 42.30 59.69

38,056.77 38,259.72 ASSETS

Non-current assets

(a) Fixed assets

(i) Tangible assets 10 11,593.86 11,097.86

(ii) Intangible assets 10 420.36 473.56

(iii) Capital work-in-progress 10 4,600.43 1,496.02

(b) Non-current investments 11 820.07 257.44

(c) Long-term loans and advances 12 1,593.77 624.77

Current assets

(a) Inventories 13 5,997.74 7,542.87

(b) Trade receivables 14 7,239.73 7,636.98

(c) Cash and bank balances 15 1,800.37 3,930.54

(d) Short-term loans and advances 16 3,990.44 5,199.68

38,056.77 38,259.72

Significant accounting policies and notes forming part of the Accounts 23

As per our attached report of even date For and on behalf of the BoardFor S M N P & Co. Sd/– Sd/–Chartered Accountants G.Veera Bhadram M.K.Tandon(Registration No. 105929W) President & Whole time Director ChairmanSd/– Sd/– Sd/-Sunil S. Dayma Pritam Vartak N. ShankarPartner(M.No:F-100542) Company Secretary Head - Finance

Place : MumbaiDate : April 18, 2012

33

Annual Report 2011-12SaberoSTATEMENT OF PROFIT AND LOSS FOR THE YEAR ENDED 31, MARCH 2012

(` in lacs) As at As atParticulars Note 31-Mar-12 31-Mar-11

Revenue From Operations 17 35,842.67 41,079.77

Other income 18 279.57 261.54

Total Revenue 36,122.24 41,341.31

Expenses:

Cost of materials consumed 23,657.62 25,753.20

Purchases of Stock-in-Trade 620.48 1983.40

Changes in inventories 19 (30.90) (1,468.86)

Employee benefits expense 20 2,322.44 1,997.31

Finance costs 21 2,812.60 1,547.48

Depreciation and amortization expense 10 1,103.93 860.09

Other expenses 22 13,101.02 8,921.38

Total expenses 43,587.19 39,594.00

Profit/( Loss) before tax (7,464.95) 1,747.31

Tax expense:

Current tax - 473.56

Deferred tax (1,340.58) 210.86

Profit/(Loss) after tax (6,124.37) 1,062.89

Earnings per equity share of ` 10/- each

Basic and Diluted 23-B-2 (18.08) 3.14

Significant accounting policies and notes forming part of the Accounts 23

As per our attached report of even date For and on behalf of the Board

For S M N P & Co. Sd/– Sd/–Chartered Accountants G.Veera Bhadram M.K.Tandon(Registration No. 105929W) President & Whole time Director Chairman

Sd/– Sd/– Sd/-Sunil S. Dayma Pritam Vartak N. ShankarPartner(M.No:F-100542) Company Secretary Head - Finance

Place : MumbaiDate : April 18, 2012

34

SaberoCASH FLOW STATEMENT FOR THE YEAR ENDED 31, MARCH 2012

(` in lacs) As at As atParticulars 31-Mar-12 31-Mar-11

Cash flow from operating activitiesProfit before tax (7,464.95) 1,747.31 Adjustments for: Depreciation and amortisation expense 1,103.93 860.09 Profit on sale of fixed assets 87.06 - Foreign exchange fluctuation 247.90 (160.26) Provision for doubtful debts 274.07 - Interest expense 2,812.60 1,547.48 Operating profit before working capital changes (2,939.39) 3,994.62 Adjustments for:Increase/ (decrease) in trade payables 1,130.14 593.49 Increase/ (decrease) in other current liabilities 953.14 1,056.56 Increase/ (decrease) in other long-term liabilities (1.30) (518.35)Increase/ (decrease) in Margin money accounts 30.22 (320.60)Decrease/ (increase) in trade receivables 188.27 271.42 Decrease/ (increase) in inventories 1,545.13 (2,039.28)Decrease/ (increase) in long-term loans and advances (969.00) (624.77)Decrease/ (increase) in short-term loans and advances 1,223.96 (1,424.09)Cash generated from operations 1,161.17 989.00 Interest receivedDirect taxes paid (14.73) (473.56)Net cash flow from operating activities (A) 1,146.44 515.44

Cash flows from investing activitiesPurchase of fixed assets, including intangible assets, (5,187.82) (4,341.09)capital work-in-progress and capital advances Sale of fixed assets 449.62 - Purchase of non-current investments (562.63) (204.98)Net cash used in investing activities (B) (5,300.82) (4,546.07)Cash flow from financing activities Proceeds from issue of equity shares 0.07 10.11 Proceeds from long-term borrowings 2,326.76 2,768.47 Repayment of long-term borrowings (567.25) - Increase/ (decrease) in short-term borrowings 3,128.62 4,913.82 Interest paid (2,833.76) (1,536.20)Net cash from financing activities (C) 2,054.44 6,156.20

Net increase/ (decrease) in cash and cash equivalents (A + B + C) (2,099.95) 2,125.57 Cash and cash equivalents at the beginning of the year 2,372.07 246.50 Cash and cash equivalents at the end of the year 272.12 2,372.07

As per our attached report of even date For and on behalf of the BoardFor S M N P & Co. Sd/– Sd/–Chartered Accountants G.Veera Bhadram M.K.Tandon(Registration No. 105929W) President & Whole time Director ChairmanSd/– Sd/– Sd/-Sunil S. Dayma Pritam Vartak N. ShankarPartner(M.No:F-100542) Company Secretary Head - Finance

Place : MumbaiDate : April 18, 2012

35

Annual Report 2011-12SaberoNOTES FORMING PART OF FINANCIAL STATEMENTS

(` in lacs) As at As atParticulars 31-Mar-12 31-Mar-11

Note 1: SHARE CAPITALAuthorised: 3,60,00,000 ( 2011:-3,60,00,000)Equity Shares of `10/- each 3,600.00 3,600.00

Issued: 3,38,66,077(2011:3,38,66,077) Equity Shares of `10/- each 3,386.61 3,386.61

Subscribed and Paid-up 3,38,66,077(2011:3,38,66,077) Equity Shares of `10/- each 3,386.61 3,386.61 Less: Calls in arrears (1.10) (1.16) 3,385.51 3,385.45 (i) No. of Equity shares and amount outstanding at the beginning and at the end of the year. Year ended 31, March 2012 2011 Number ` in lacs Number ` in lacsPer last Balance sheet 33,866,077 3,385.45 33,809,105 3,379.75 Add: Issued during the year/calls in arrears - 0.06 56,972 5.70 Outstanding at the end of the year 33,866,077 3,385.51 33,866,077 3,385.45 (ii) As at 31, March 2012,Coromandel International Ltd (Holding Company) holds 24,798,112 (2011: Nil) of `10/- each

fully paid up representing 73.22% of the paid-up capital.(iii) During the year, Coromandel International Limited(Coromandel), pursuant to the approval from Securities Exchange

Board of India (SEBI) acquired 1,05,00,000 (31%) equity shares of the Company at a price of ` 160/- per share as part of the open offer made to the public share holders of the Company and also acquired 1,42,98,112 (42.22%) equity shares from the erstwhile promoters of the Company.

(iv) Shares held by each shareholder holding more than 5% of equity share capital.

Year ended 31, March 2012 2011(a) Coromandel International Ltd(Holding Company) 73.22% -(b) Kalah Corporation 7.50% 14.99%(c ) Mohit Chuganee - 9.51%(d) Hero Chuganee - 8.76%(e) Karville Company Limited - 14.81%

(v) During the period of five years immediately preceding the reporting date, there were no (a) shares allotted as fully paid up pursuant to contracts without payment being received in cash (b) shares allotted as fully paid up by way of bonus shares (c) shares bought back.(vi) 18390 (2011 18616), equity shares of ` 10 each were outstanding as calls unpaid from other than directors/ officers

of the Company.

36

SaberoNOTES FORMING PART OF FINANCIAL STATEMENTS

(` in lacs) As at As atParticulars 31-Mar-12 31-Mar-11

Note 2: RESERVES AND SURPLUS i) Capital Reserve (Government Subsidy ) Per last Balance Sheet 15.00 15.00

ii) Securities Premium Reserve Account Per last Balance Sheet 1,370.97 1,366.55 Add: Received on account of share warrants - 4.42 1,370.97 1,370.97iii) General Reserve Per last Balance Sheet 1,164.96 1,164.96 iv) Surplus as per the statement of Profit & Loss Per last Balance Sheet 6,637.93 5,575.04 Add: Profit/(Loss) for the year (6,124.37) 1,062.89 513.56 6,637.93 3,064.49 9,188.86 Note 3: LONG TERM BORROWINGSSecuredTerm Loans - Banks 7,506.85 5,120.75 - Others 8.25 106.85 7,515.10 5,227.60 - Less: Current maturities, disclosed in other current liabilities 1,086.79 567.25 6,428.31 4,660.35

(i) The above term loans are secured by a first mortgage on the immovable properties both present and future and a first charge by way of hypothecation of all the movables properties(save and except book debts), present and future, ranking pari-passu interse, subject to prior charges created in favour of the bankers on the inventories and other movable properties for securing the borrowings for working capital requirements.

(ii) Other loans are secured by way of hypothecation of vehicles acquired.(iii) During the previous year certain long term loans amounting to `1864.38 lacs were guaranteed by Mr. Sumit

Chuganee (erstwhile director) , `2340.50 lacs were guaranteed by both Mr. Mohit Chuganee and Sumit Chuganee and `930.80 lacs guaranteed by Mr. Hero Chuganee, Mr. Mohit Chuganee and Mr. Sumit Chuganee(erstwhile directors).

(iv) Terms of repayment of term loans and other loans as at reporting date is as under

Name of the bank Period of maturity Amount of installment No. of installmentsUBI Nov.13 12.50 20 FBL Oct.13 8.33 19 DENA Sep.13 4.17 18 IDBI Jul.12 25.00 1 EXIM Jan.16 43.75 16 AXIS-ECB Nov.15 146.25 16 RATNAKAR Jun.15 250.00 8

Rate of interest for the above loans ranges from 4%-18%

37

Annual Report 2011-12SaberoNOTES FORMING PART OF FINANCIAL STATEMENTS

(` in lacs) As at As atParticulars 31-Mar-12 31-Mar-11

Note 4: DEFERRED TAX ASSETS/LIABILITIESDeferred Tax Liabilities

On account of depreciation 1484.82 1378.03 Research & Development Expenditure 0.75 0.12 'Product Development Expenditure 184.30 126.42 1,669.87 1,504.57Deferred Tax Assets On statutory dues allowable on payment basis 160.28 118.54 On employees separation and retirement cost 51.41 45.45 Business Losses carried forward 1,458.18 - 1,669.87 163.99

Net Deferred Tax Asset/(Liabilities) - 1,340.58

Deferred Tax Assets(`2404.49/- lacs) on carried forward losses(including depreciation) are recognised to the extent of Deferred Tax Liability considering the prudence aspect.

Note 5: LONG TERM PROVISIONS Employee Benefits(Refer note 23 B 8) for gratuity 96.79 80.96for compensated absences 35.42 35.16 132.21 116.12Note 6: SHORT TERM BORROWINGSSecured:Loans repayable on demand - from Banks 12,089.89 7,967.21Other loans from banks 2,205.73 3,112.13Dealer Deposits 100.99 111.15 14,396.61 11,190.49

(i) The above short term borrowings are secured by a first charge by way of hypothecation of all tangible assets including stocks of raw materials, work in process, finished goods and book debts and a second charge on the immovable properties, both present and future.

(ii) During the previous year, working capital loans and non fund based facilities amounting to `22000 lacs from consortium of banks viz Union Bank of India, Bank of India, Dena Bank, Federal Bank, Axis Bank, State Bank of India, Ratnakar Bank, Oriental Bank of Commerce and IDBI bank were further secured by personal guarantee of all 3 erstwhile directors of the Company, viz Mr. Hero Chuganee, Mr. Mohit Chuganee and Mr. Sumit Chuganee.

38

SaberoNOTES FORMING PART OF FINANCIAL STATEMENTS

(` in lacs) As at As atParticulars 31-Mar-12 31-Mar-11

Note 7: TRADE PAYABLES - Acceptances 838.07 1,378.23 - Others 6,700.25 4,802.89 7,538.32 6,181.12Note 8: OTHER CURRENT LIABILITIES Current maturities of long-term debt 1,086.79 567.25 Creditors for capital goods 485.73 495.34 Interest accrued but not due on borrowings 32.44 11.29 Unpaid dividends 6.46 6.87 Other Liabilities 1,457.60 1,056.31 3,069.02 2,137.06Note 9: SHORT TERM PROVISIONS Employee Benefits 22.58 20.72 Income Tax (net) 15.22 38.63 Wealth Tax 4.50 0.34 42.30 59.69

39

Annual Report 2011-12SaberoNote 10: FIXED ASSETS

Land Buildings Plant and equipment

Office equip-ment,

furniture & fixtures

Compu-ters

Vehicles Ships Total tangible assets

Intangible Asset Capital work in

progressFreehold Leasehold Software Product Develop-

ment

Total Total

Gross carrying amount:As at 1 April 2010

7.28 129.29 2,474.96 12,027.41 0.18 63.62 149.43 221.29 101.48 15,174.94

125.01 105.74

230.75

15,405.69

Additionsa - - 439.74 2,233.75 3.67 4.51 24.81 95.78 - 2,802.26 - 351.35 351.35 3,153.61 Disposal/ adjustments

- - - - - - - - - - - - - -

As at 31 March 2011

7.28 129.29 2,914.70 14,261.16 3.85 68.13 174.24 317.07 101.48 17,977.20 125.01 457.09 582.10 18,559.30

As at 1 April 2011

7.28 129.29 2,914.70 14,261.16 3.85 68.13 174.24 317.07 101.48 17,977.20 125.01 457.09 582.10 18,559.30

Additionsa - - 653.01 1,128.75 13.30 3.76 28.41 - - 1,827.23 - 97.74 97.74 1,924.97 Disposal/ adjustments

- - 196.83 2.27 2.57 69.28 3.65 266.67 101.48 642.75 - - - 642.75

As at 31 March 2012

7.28 129.29 3,370.88 15,387.64 14.58 2.61 199.00 50.40 - 19,161.68 125.01 554.83 679.84 19,841.52

Accumulated depreciation/ impairment: As at 1 April 2010

- 12.75 623.86 5,207.68 0.00 47.83 93.68 108.95 0.14 6,094.89 11.77 21.14 32.91 6,127.80 -

Depreciation - 1.31 82.79 638.40 0.12 4.08 26.46 24.12 7.17 784.45 20.26 55.37 75.63 860.08 -

Disposal/ adjustments

-

-

-

-

-

-

-

-

-

-

-

-

-

-

As at 31 March 2011

- 14.06 706.65 5,846.08 0.12 51.91 120.14 133.07 7.31 6,879.34 32.03 76.51 108.54 6,987.88 -

As at 1 April 2011

- 14.06 706.65 5,846.08 0.12 51.91 120.14 133.07 7.31 6,879.34 32.03 76.51 108.54 6,987.88 -

Depreciation - 1.31 113.84 779.50 0.66 4.12 30.17 21.61 1.78 952.99 20.26 130.68 150.94 1,103.93 -

Disposal/ adjustments

- - 72.58 0.17 0.16 55.91 0.60 126.00 9.09 264.51 - - - 264.51

As at 31 March 2012

- 15.37 747.91 6,625.41 0.62 0.12 149.71 28.68 - 7,567.82 52.29 207.19 259.48 7,827.30 -

Net carrying amount

As at 31st March 2012

7.28 113.92 2,622.97 8,762.23 13.96 2.49 49.29 21.72 - 11,593.86 72.72 347.64 420.36 12,014.22 4,600.43

As at 31st March 2011

7.28 115.23 2,208.05 8,415.08 3.73 16.22 54.10 184.00 94.17 11,097.86 92.98 380.58 473.56 11,571.42 1,496.02

Notes: a. Refer note 23 B-11 for preoperative expenses on projects, included in capital work-in progress

40

SaberoNOTES FORMING PART OF FINANCIAL STATEMENTS

(` in lacs) As at As atParticulars 31-Mar-12 31-Mar-11

Note 11: NON CURRENT INVESTMENTS Trade Investments, Unquoted(at cost)Subsidiary companies Sabero Australia Pty Ltd1140 (2011:-100 )Equity shares of Aus $ 14 each of fully paid up 8.10 0.39

Sabero Europe BV40 (2011:40) Equity shares of NLG 10/- each fully paid up. 1.42 1.42

Sabero Argentina SA2,13,350 (2011:161500) Equity Shares of AR$ 1/- each, fully paid up 17.17 11.26

Sabero Organics America S.A.36,07,513 (2011:.14,60,805) Equity Shares of R$ 1/- each , fully paid up 793.38 243.18

Joint Venture CompanyMarkan Agroquimica LtdaNil (2011:4400) Equity Shares of R$ 0.10 each, fully paid up - 1.19 820.07 257.44Shares for the current year includes shares not yet allotted- Sabero Australia Pty Ltd-1040(2011-nil) Sabero Argentina SA-51850,(2011-nil) Sabero Organics America S.A.-132614(2011-nil) Aggregated amount of unquoted investments 820.07 257.44

Note 12: LONG TERM LOANS AND ADVANCESUnsecured, considered good:Capital advances 1,582.78 624.77Others 10.99 - 1,593.77 624.77Note 13: INVENTORIES Raw Materials(*) - in transit - - Others 2,164.19 3,223.65Work-in-process(**) 619.63 340.53Finished Goods (**) 3,076.68 3,324.88Stores & Spares(*) 192.78 683.81 6,053.28 7,572.87Less: Provision for obsolete stock (55.54) (30.00) 5,997.74 7,542.87(*) At or below cost(**)(At cost or net realisable value whichever is lower)

41

Annual Report 2011-12SaberoNOTES FORMING PART OF FINANCIAL STATEMENTS

(` in lacs) As at As atParticulars 31-Mar-12 31-Mar-11

Note 14: TRADE RECEIVABLES

UnsecuredOutstanding for a period exceeding six months from due date :

- Secured 15.57 37.18 - Unsecured, considered good 583.63 753.96 - Unsecured, considered doubtful 222.78 53.96 821.98 845.10 Less: Provision for doubtful debts 222.78 53.96 599.20 791.14Other debts - Secured 22.55 - - Unsecured 6,617.98 6,845.84

7,239.73 7,636.98

Note 15: CASH AND BANK BALANCES

Cash and cash equivalentsCash on hand 14.21 22.02

In Current Accounts 257.91 2,350.05 272.12 2,372.07Other bank balances - In Margin Money Account * 1,521.79 1,551.60 - In Unapid dividend account 6.46 6.87

1,800.37 3,930.54* Against Letter of Credit, Bills Discounted and Guarantees issued by the bank. Note 16: SHORT TERM LOANS AND ADVANCESUnsecured, Considered good unless otherwise statedAdvances recoverable in cash or in kind or for value to be received Considered good 1,956.60 1,916.63

Considered doubtful 221.31 53.96Deposits 275.93 296.31Advances to related parties 24.83 29.08Others (with Government Authorities) 1,733.08 2,957.66 4,211.75 5,253.64Less Provision for doubtful advances (221.31) (53.96) 3,990.44 5,199.68

42

SaberoNOTES FORMING PART OF FINANCIAL STATEMENTS

(` in lacs) As at As atParticulars 31-Mar-12 31-Mar-11

Note 17: REVENUE FROM OPERATIONSRevenue from OperationsSale of Products/services 36,489.34 42,439.77Less: Excise Duty 1,824.73 2,797.00 34,664.61 39,642.77Other Operating Revenues - Export incentives 1,012.57 1,280.65 - Others 165.49 156.35 35,842.67 41,079.77Note 18: OTHER INCOME Interest income 106.17 190.13Profit on sale of assets 105.18 -Others 68.22 71.41

Total 279.57 261.54

Note 19: CHANGE IN INVENTORIES

Stock as at April 1st Finished Goods 3,324.88 1,826.16 Work-in-process 340.53 370.39 3,665.41 2,196.55Stock as at March 31 Finished Goods 3,076.68 3,324.88 Work-in-process 619.63 340.53 3,696.31 3,665.41 (30.90) (1,468.86)Note 20: EMPLOYEE BENEFITS Salaries, Wages and Bonus 2,070.93 1,756.89Contribution to Provident & Other Funds 100.92 89.96Staff Welfare Expenses 150.59 150.46 2,322.44 1,997.31

43

Annual Report 2011-12SaberoNOTES FORMING PART OF FINANCIAL STATEMENTS

(` in lacs) As at As atParticulars 31-Mar-12 31-Mar-11

Note 21: FINANCE COSTS

Interest expense 2,094.69 1,401.44Other borrowing costs 339.94 172.16Foreign Exchange Fluctuation on borrowings 377.97 (26.12) 2,812.60 1,547.48

Note 22: OTHER EXPENSES Power, Fuel and water 4,860.03 2,871.78Stores and consumables 986.12 1,017.55Rent 135.08 105.98Repairs to Plant and Machinery 228.62 269.23 Building 102.05 14.91 Others 53.99 15.63Insurance 135.93 145.62Rates and taxes 7.43 3.53Freight and distribution expenses 1,637.49 1,882.49Travelling and Conveyance 366.59 396.38Legal and Professional fees 415.79 288.09Directors' sitting fees 4.16 1.40Loss on sale of assets 18.11 -Provision for trade receivables 274.07 -Provision for doubtful advances 221.31 53.96Trade and other receivables, loans and advances written off 1,303.70 168.93Foreign Exchange Fluctuation-others 567.14 (391.95)Miscellaneous Expenses 1,783.40 2,077.85 13,101.01 8,921.38

44

SaberoNote No.-23

SIGNIFICANT ACCOUNTING POLICIES AND NOTES ON ACCOUNTS FOR THE YEAR ENDED 31ST MARCH 2012.

A. Significant accounting policies

1. Basis of preparation of financial statements

The financial statements have been prepared on the basis of going concern, under the historic cost convention on accrual basis, to comply in all material aspects with applicable Generally Accepted Accounting Principles in India (“Indian GAAP”), the Accounting Standards (“AS”) notified under Section 211 (3C) of the Companies Act, 1956 (“the Act”) and the relevant provisions of the Act.

2. Use of Estimates

The preparation of financial statements in conformity with the generally accepted accounting principles requires estimates and assumptions to be made that may affect the reported amount of assets and liabilities and disclosures relating to contingent liabilities as at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Management believes the estimates used in the preparation of financial statements are prudent and reasonable. Actual results could differ from those estimated. Any revision to accounting estimate is recognized prospectively in the current and future periods.

3. Tangible Fixed Assets

Tangible Fixed Assets are stated at cost less accumulated depreciation. Cost comprises the purchase price and any attributable costs of bringing the asset to their working condition for their intended use.

4. Intangible Assets

Intangible Assets are recorded at their cost of acquisition. Cost of an internally generated asset, if any, comprises all expenditure that can be directly attributed, or allocated on a reasonable and consistent basis, to creating, producing and making the asset ready for its intended use.

5. Depreciation

Cost of leasehold land is amortised over the remaining period of lease after the commencement of commercial production.

Depreciation on other Fixed Assets is provided on Straight Line Method at the rates and in the manner specified in Schedule XIV to the Companies Act, 1956. Continuous process plants are classified on technical assessment and depreciation provided accordingly.

Depreciation on the Fixed Assets added/disposed off/discarded during the year is provided on pro-rata basis with reference to the month of addition / disposal/discarding.

6. Amortisation of Intangible assets

The Intangible Assets are amortised on straight line basis based on their actual life of ten years whichever is lower.

7. Borrowing Costs:

Borrowing costs attributable to the acquisition or construction of qualifying assets which take substantial period of time are capitalised as part of cost of such asset up to the date when such asset is ready for its intended use. Other borrowing costs are recognised as an expense in the period in which they are incurred.

8. Investments

Investments which are readily realizable and are intended to be held for not more than one year from the date, on which such investments are made, are classified as current investments. All other investments are classified as long term investments.

Long-term investments are carried at cost of acquisition. Provision is made only when in management’s opinion there is a decline, other than temporary, in the carrying value of such investments. Current investments are valued at lower of cost and market value.

9. Inventories

Raw materials and Stores and spares are valued at or below cost. Other inventories are valued at lower of cost and net realizable value. The method of determination of cost of various categories of inventories is as follows:

Raw Materials: weighted average cost, cost includes purchase cost and attributable expenses.

Finished Goods & Work-in-process : weighted average cost of production, which comprises of direct material costs, direct wages and applicable overheads. Excise duty is included in the value of finished goods. The obsolete, defective and unserviceable stocks and duty are provided for whenever required.

Store & Spares: Weighted average cost

Stock in Trade: Weighted average cost

10. Foreign Currency Transactions

Transactions made during the year in foreign currency are recorded at the exchange rate prevailing at the time of transactions. Monetary assets and liabilities relating to foreign currency transactions remaining unsettled at the year-end are translated at the exchange rate prevalent at the date of Balance Sheet. Exchange differences arising on actual payment/ realisation and year end reinstatement referred to above are recognised in the Statement of Profit and Loss.

11. Revenue Recognition

The Company recognises Sales at the point of dispatch of goods to the customers which coincides with the transfer of risks and rewards. . Sales include amount

45

Annual Report 2011-12Saberorecovered towards Excise Duty and exclude Sales tax and Value added tax. Interest income is accounted for on accrual basis.

12. Taxation

Provision for Taxation is made for the current accounting period (reporting period) on the basis of the taxable Income as determined in accordance with the provision of Income Tax Act, 1961.

Deferred Tax resulting from timing differences between book and tax profits is accounted for under the liability method using the tax rates and laws that have been substantively enacted as at the Balance Sheet date, to the extent that the timing differences are expected to crystallize.

Deferred tax assets are recognised only to the extent there is reasonable certainty that the assets can be realized in future. However, where there is unabsorbed depreciation or carried forward loss under taxation laws, deferred tax assets are recognised only if there is a virtual certainty of realisation of such assets. Deferred tax assets are reviewed as at each Balance Sheet date and written down or written up to reflect the amount that is reasonably/virtually certain to be realized.

13. Government Grants

Grants relating to Fixed Assets in the nature of project capital subsidy are credited to Capital Reserve.

14. Retirement Benefits:

Defined contribution plans

Contributions paid/payable to defined contribution plans comprising Provident Fund for employees covered under the Scheme are recognised in the Statement of Profit and Loss each year.

The Company makes contributions to Recognised Provident Fund for employees, at a specified percentage of the employees’ salary. The Company does not have any other obligation apart from making contributions to the fund.

Defined benefit plans

Gratuity for employees is covered under a Scheme of Life Insurance Corporation of India (LIC) and contributions in respect of such scheme are recognised in the Statement of Profit and Loss. The liability as at the Balance Sheet date is provided for based on the actuarial valuation carried out as at the end of the year.

Other long term employee benefits

Other long term employee benefits comprise of leave encashment which is provided for based on the actuarial valuation carried out as at the end of the year.

15. Earnings per Share

Basic earning per share is calculated by dividing the net profit for the period attributable to equity shareholders by the weighted average number of equity shares

outstanding during the period. The weighted average number of equity shares outstanding during the period is adjusted for events of subsequent issue of shares.

For the purpose of calculating diluted earnings per share, the net profit for the period attributable to equity shareholders and weighted average number of shares outstanding during the period is adjusted for the effects of all dilutive potential equity shares.

16. Impairment of Assets

The carrying amounts of the Company’s assets are reviewed at each Balance Sheet date. If any indication of impairment exists, an impairment loss is recognised to the extent of the excess of the carrying amount over the estimated accountable amount.

17. Provisions, Contingent Liabilities and Contingent Assets

Provisions are recognised in respect of present probable obligations, the amount of which can be reliably estimated.

Contingent Liabilities are disclosed in respect of possible obligations that arise from past events but their existence is confirmed by the occurrence or non occurrence of one or more uncertain future events not wholly within the control of the Company.

A Contingent asset is neither recognized nor disclosed in the financial statements.

B. NOTES ON ACCOUNTS.

1. During the year, Coromandel International Limited(Coromandel), pursuant to the approval from Securities Exchange Board of India (SEBI) acquired 1,05,00,000 (31%) equity shares of the Company at a price of ` 160/- per share as part of the open offer made to the public shareholders of the Company and also acquired 1,42,98,112 (42.22%) equity shares from the erstwhile promoters of the Company . With the said acquisition, Coromandel, now along with its subsidiary Parry Chemicals Limited holds 74.57% of the equity capital of the Company.

2. Basic & Diluted Earnings per Share:

Year ended March 31,2012 2011

1. Profit/(loss) after tax (` In Lacs) - [a]

(6,124.37) 1,062.89

2. Weighted average number of Equity shares of `10/- each outstanding during the year. – [b]

3,38,66,077 33,862,019

Earnings Per share (`)3. Basic and diluted- [a]/[b] (18.08) 3.14

46

Sabero3. Contingent Liabilities and commitments:

a) Contingent Liabilities :

a) Claims against the Company not acknowledged as debts

(` in lacs)

Year ended March 31,2012 2011

Income Tax

474.95 179.18

Sales Tax 148.22 -Excise Matters 51.21 -Others(legal cases) 130.61 -

b) Bills Discounted and outstanding: ̀ 3,933.75 lacs (2011-`5,613.11 lacs), since realized `554.27 lacs (2011-

` 2,348.05 lacs).

c) Bank Guarantees outstanding ` 695.23 lacs (2011- ` 475.40 lacs)

b) Commitments :

(` in lacs)

As at March 31,2012 2011

Capital Commitments 4,106.10 4,317.74

4. During the previous year, the Company has allotted 56,972 equity shares of `10/- each at premium of `7.75 per share, vide resolution passed in the Board meeting held on 26th April, 2010 & the said allotment was made upon the conversion of optionally fully convertible Warrants issued by the Company to the allottee. The object of the issue was to fulfil the working capital requirements of the Company.

5. There are no reported cases of dues payable to Micro, Small and Medium Enterprises for more than 45 days, and hence there is no need for provision of interest in current year. The same is based on the information available with the Company and relied upon by the Auditors.

6. Keeping in view of the losses incurred by the Company during the current year, the remuneration to the directors is governed by the relevant provisions of Schedule XIII to the Companies Act, 1956. Managerial remuneration paid during the current year amounting to ̀ 87.73 lacs is in excess of the limits so prescribed. The Company has since applied to Central Government for approval of the said amount paid.

7. Product registration expenses, hitherto grouped under miscellaneous expenditure have now been regrouped under Intangible assets.

8. Consequent to the completion of reconciliation of major balances under various assets and liabilities, the company has charged off to revenue Rs.2818.13 lacs (2011 - Rs.586.85 lacs) under respective heads of accounts.

9. Employee Benefits

Actuarial Valuation of leave encashment and gratuity have been done on the following assumptions:

Statement of Profit and Loss

` in lacs

Year ended March 31, Particulars 2012 2011

Leave Encashment(unfunded)

Gratuity(Funded)

Leave Encashment(unfunded)

Gratuity(Funded)

Current Service Cost

16.90 34.92 18.71 6.36

Interest on defined Benefit Obligation

3.75 7.20 2.35 4.93

Expected Return on Plan Assets

- - - -

Settlement Cost / Credit

(28.11) (17.94) (11.26) (11.30)

Net actuarial (gain) / loss Recognized in the year

7.82 (6.61) 7.72 7.53

Total included in Employee Benefit Expenses

0.36 17.57 17.52 7.52

Balance Sheet

(` in lacs)

As at March 31, Particulars 2012 2011

Leave Encashment(unfunded)

Gratuity(Funded)

Leave Encashment(unfunded)

Gratuity(Funded)

Liability at the end of the year

47.24 107.54 46.88 89.97

Fair Value of Plan Assets at the end of the year

Nil Nil Nil Nil

Amount in Balance Sheet

47.24 107.54 46.88 89.97

47

Annual Report 2011-12SaberoChanges in the present value of the defined benefit obligation are as follows:

(` in lacs)

Particulars

Year ended March 31, 2012 2012

Leave Encashment(Unfunded)

Gratuity(Funded)

Leave Encashment(Unfunded)

Gratuity(Funded)

Liability at the beginning of the year

46.88 89.97 29.36 82.45

Interest Cost 3.75 7.20 2.35 4.93Current Service Cost

16.90 34.92 18.71 6.36

Benefits paid 28.11 17.94 11.26 11.30Actuarial Losses / (Gain)

7.82 (6.61) 7.72 7.53

Liability at the end of the year

47.24 107.54 46.88 89.97

Principal actuarial assumptions as at the Balance Sheet date:

(` in lacs)

Year ended March 31,

Particulars2012 2012

Leave Encashment(Unfunded)

Gratuity(Funded)

Leave Encashment(Unfunded)

Gratuity(Funded)

Discount Rate

8.00 % 8.00 % 8.00 % 8.00 %

Salary Escalation Rate (p.a.)

5.00 % 5.00 % 5.00 % 5.00 %

Expected Rate of Return on Assets (p.a.)

N.A. 5.30 % N.A. N.A.

Expected average remaining working lives of employees (years)

19 19 19 19

10. Segment Reporting:

a) Business Segment

The Company’s main business is to manufacture and sell Crop Protection Chemicals and Inputs. All other activities of the Company are incidental to the main business. As such, there is no separate reportable segment as per the Accounting Standard 17 Segment Reporting.

b) Geographical Segment

The Company’s operating facilities are located in India. The segmental reporting for the Secondary Segment – Geographical as per the Accounting Standard 17 Segment Reporting.

(` in lacs)

Year ended March 31, 2011-12 2010-11

Domestic Revenue 17,068.67 18,590.44 Export Revenue (Including Export benefits) 18,774.00 22,489.33Total 35,842.67 41,079.77

11. Related Party disclosures

Related party disclosures, as required by Accounting Standard 18, are as under:

c) Names of the related parties and their relationship:

Names Nature of relationshipCoromandel International Limited Holding Company

(w.e.f. 17th December 2011)Sabero Australia Pty Ltd SubsidiarySabero Europe BV SubsidiarySabero Organics America S/A SubsidiarySabero Argentina S.A SubsidiaryMarkan Argoquimica Ltda $ Joint VentureSabero Organics Philippines Asia Inc AssociateSabero Echostar (India) Pvt Ltd* Directors in commonHarvard Finance Co.Pvt Ltd.* Directors in commonWhite Waves Capital LLP* Directors in commonTranquilitta Capital Advisors Private Limited*

Directors in common

Mosum Entreprises Ltd* Directors in commonMr. Mohit H.Chuganee* Key Management personnelMr. Hero Chuganee* Key Management personnelMrs. Sabita H Chuganee* Relative of DirectorMr. Sumit H. Chuganee* Key Management personnelMr. Rajesh Sharma# Key Management personnelMr. Ashok Muni @ Key Management personnelMr. G. Veera Bhadram** Key Management personnel

* Ceased to exist as related parties effective 17th December 2011.

** W.e.f. 19th December 2011.

# Exist till 7th September 2011.

@ Exist till 19th December 2011.

$ Ceased to exist as related party effective 3rd October 2011.

The above Related parties are as identified by the Company and relied upon by the Auditors.

48

Saberod) Transactions with Related Parties:

During the year, the following transactions were carried out with the related parties in the normal course of the business:

(` in lacs)

Nature of Transaction

Holding company /Subsidiaries

Key Management Personnel

Relatives of Key Management Personnel

Year ended March 31,

2012

Year ended March 31,

2011

Year ended March 31,

2012

Year ended March 31,

2011

Year ended March 31,

2012

Year ended March 31,

2011Purchase of Fixed Assets - - 470.69 - -Purchase of Services(Excluding service tax)

4.45 4.82 46.94 45.87 12.60 16.80

Purchase of Goods 89.06 - - - - -Sale of Fixed Assets 227.69 - 240.00 - - -Sales of Goods 1,500.29 40.31 - - - -Sale of Services 0.70 - - - - -Remuneration - - 254.19 137.29 - -Sitting Fees - - 4.16 1.40 -Commission - - - 21.00 - -Investments 562.63 204.25 - - - -Advances given 2.65 14.76 - - - -

e) Outstanding balances as at 31st March 2012

Nature of Transaction

Subsidiaries Key Management Personnel

Relatives of Key Management Personnel

As at March 31, 2012

As at March 31, 2011

As at March 31, 2012

As at March 31, 2011

As at March 31, 2012

As at March 31, 2011

Payables 114.22 0.85 15.48 30.24 - 1.52Receivables 19.94 0.40 - 0.62 - 12.60Advances 24.83 29.08 - - - -12. Pre-operative Expenses pending allocation

(included in Capital Work –in- progress)

(` In lacs)

Year ended March 31,

2012 2011Opening Balance 440.83 247.51Add: Incurred during the YearEmployee Benefits expense 166.31 108.00Borrowing Costs(*) 101.06 49.09Other expenses 110.71 36.23Total 378.08 193.32Closing Balance 818.91 440.83

(*) Net of income of ` 47.82lacs (2011-nil).

13. Investments in Joint Venture

During the year, the Company and its subsidiary Sabero Organics America S/A has entered into an settlement agreement with Embrasil, Brazil and Markan Agroquimica Ltd, Brazil (Markan), with the said settlement, the Company is no longer a co-venturer in Markan.

14. The Company believes that no impairment of assets arises during the year in respect of its assets under the purview of Accounting Standard - 28 Impairment of Assets.

15. Remuneration to Auditors, grouped under miscellaneous expenses, comprises of the following:

(` In lacs)

Year ended March 31, 2012 2011

Audit fees 4.50 3.50Limited Review Certification 1.50 1.50Other certification 1.20 1.80Total 7.20 6.8016. Other additional information

a. Value of imports on C.I.F. basis:(` In lacs)

Year ended March 31,2012 2011

Raw Material 9,199.07 14,014.63Stores and Spares - 14.20Capital Goods 7.33 -

9,206.40 14,028.83

49

Annual Report 2011-12Saberob. Expenditure (payments) in Foreign Currency:

(` In lacs)

Year ended March 31,2012 2011

Export Commission 124.82 147.72Travelling 36.67 46.41Product Registration Expenses 224.17 23.61Interest 84.63 41.21Others 159.31 29.71Total 629.60 288.66c. Earnings in Foreign Currency:

(` In lacs)

Year ended March 31,2012 2011

F.O.B. Value of exports of goods 18,513.84 21,892.7017. Details of raw materials, stock-in-trade and finished

goods

(` In lacs)

Year ended March 31,2012 2011

Quantity Value Quantity Value(MT) (` in lacs) (MT) (` in lacs)

i Sales Inorganic Compounds

4065.77 79.34 692.00 30.49

Organo Phosphorus Intermediates

354.39 606.10 1,523.09 2,104.01

Pesticides 13479.88 19,913.85 11,480.11 29,288.32Pesticide Formulation ( in MT )

3174.10 6,969.81 4,222.09 5,356.25

Pesticide Formulation ( in KL )

4995.16 9,203.28 5,044.91 7,097.70

Other - 895.02 - -Gross sales 37,667.40 43,876.77Less: Excise Duty on above

1,824.73 2,797.00

Total 35,842.67 41,079.77

Year ended March 31,2012 2011

Quantity(MT)

Value(` in lacs)

Quantity (MT)

Value(` in lacs)

ii. Closing StockInorganic Compounds

15.96 0.79 16.42 0.33

Organo Phosphorus Intermediates

43.90 53.34 14.48 18.19

Pesticides * 713.70 1,180.87 758.27 1,569.16Pesticide Formulation ( in MT )

195.58 557.09 140.56 405.17

Pesticide Formulation ( in KL )

587.94 1,241.89 887.65 1,332.02

Other - 42.70 -Total 3,076.68 3,324.87

Year ended March 31,2012 2011

Quantity(MT/KL)

Value(`.in lacs)

Quantity(MT)

Value(`in lacs)

iii. Consumption of MaterialsInorganic Chemicals 6,294.41 1,875.93 9,033.43 2,361.18Pesticide Formulation

25,243.59 18,545.36 49,502.28 17,066.58

Others 3,856.81 8,308.84Total 24,278.10 27,736.60

Percentage PercentageImported 44.83% 10,883.90 55.32 % 15,342.80Indigenous 55.17% 13,394.20 44.68 % 12,393.80

100.00 % 24,278.10 100.00 % 27,736.60Consumption of Store & Spares

Percentage PercentageImported 1% 12.81 - -Indigenous 99% 973.31 100.00% 1017.55

100.00% 986.12 100.00% 1017.5518. Previous Year’s figures are regrouped/rearranged

wherever considered necessary to conform to current year’s presentation.

50

SaberoBALANCE SHEET ABSTRACT AND COMPANY’S GENERAL BUSINESS PROFILE

ADDITIONAL INFORMATION PURSUANT TO PART IV OF SCHEDULE VI TO THE COMPANIES ACT, 1956

I. Registration Details

Registration No. : 04–20753 State Code : 04

Balance Sheet Date : 3/31/2012

II. Capital raised during the year (` in thousands )

Public Issue : ` NIL Rights Issue : ` NIL

Bonus Issue : ` NIL Private Placement : ` NIL

III. Position of Mobilisation and Deployment of Funds (` in thousands )

Total Equity and Liabilities : ` 3,805,677 Total Assets : ` 3,805,677

Sources of Funds Application of Funds

Paid-up Capital ` 338,551 Net Fixed Assets ` 1,661,465

Reserves & Surplus ` 306,449 Investments ` 82,007

Long-term borrowings ` 642,831 Long-term loans and advan ` 159,377

Current liabilities ` 2,504,625 Current Assets ` 1,902,828

Long-term provisions ` 13,221 Accumulated Losses ` Nil

IV. Performance of Company (` in thousands )

Turnover ` 3,612,224 Total Expenditure ` 4,358,719

Profit/Loss before tax ` (746,495) Profit/Loss after tax ` (612,437)

Earning per Share -Basic/Diluted ` (18.08) Dividend Rate % —

V. Generic Names of Three Principal Products of the Company (as per monetary terms)

Item Code No. 38081029

Product Description MANCOZEB

Item Code No. 29310009

Product Description TRIMETHYL PHOSPHITE

Item Code No. 38081029

Product Description ACEPHATE

For and on behalf of the Board Sd/– Sd/– G.Veera Bhadram M.K.Tandon President & Whole time Director Chairman Sd/– Sd/- Pritam Vartak N. Shankar Company Secretary Head - Finance

Place : MumbaiDate : April 18, 2012

51

Annual Report 2011-12SaberoAUDITORS’ REPORT ON CONSOLIDATED FINANCIAL STATEMENTS

The MembersSabero Organics Gujarat Limited

We have audited the attached consolidated Balance Sheet of Sabero Organics Gujarat Limited (‘the Company’) and it’s subsidiary and joint venture (together referred to as the group) as at 31st March 2012, the consolidated Statement of Profit and Loss Account for the year ended on that date annexed thereto and the consolidated cash flow statement for the year ended on that date annexed thereto. These consolidated financial statements are the responsibility of the Company’s management and have been prepared by the Management on the basis of separate financial statements and other financial information regarding components. Our responsibility is to express an opinion on these consolidated financial statements based on our audit.

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

2. We did not audit the financial statements of 4 Subsidiary companies, namely, Sabero Argentina S.A; Sabero Europe B.V., Sabero Australia Pty. Ltd; Sabero Organics America S. A. and 1 associate company, namely, Sabero Organics Philippines Asia Inc. whose statements reflect the Groups share of total assets of ` 705.86 Lacs as at 31st March 2012 and the Group’s share of total revenue of ` (240.61) and net cash inflow amounting to ̀ 3.91 Lacs for the year ended on that date as considered in the consolidated financial

statements. These unaudited statements and other information of the subsidiaries as approved by the Board of Directors of these Companies have been furnished to us by the Management and our report in so far as it relates to the amounts included in respect of these subsidiaries and associate is based solely on such unaudited financial statements.

3. Based on our audit and on consideration of the unaudited financial statements and on the other financial information of the components and accounts approved by the Board of Directors, in our opinion and to the best of our information and according to the explanations given to us and other Notes given in Note 23, the said consolidated financial statements give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India:

a) In case of the consolidated Statement Balance Sheet, of the State of Affairs of the Group as at 31st March, 2012;

b) In case of the consolidated Statement of Profit and Loss Account, of the Loss of the Group for the year ended on that date; and

c) In the case of consolidated Cash Flow Statement, of the cash flow of the Group for the year ended on that date.

For S M N P & CoChartered Accountants

Registration No – 105929Wsd/-

Sunil S. DaymaPartner

Membership No. F-100542Mumbai, 18th April, 2012

52

SaberoCONSOLIDATED BALANCE SHEET AS AT 31, MARCH 2012

(` in lacs) As at As atParticulars Note 31-Mar-12 31-Mar-11

EQUITY AND LIABILITIESShareholders’ funds (a) Share capital 1 3,385.51 3,385.45 (b) Reserves and Surplus 2 2,937.28 9,319.76 Minority Interest 0.11 0.02

Non-current liabilities (a) Long-term borrowings 3 6,428.31 4,660.35 (b) Deferred tax liabilities (net) 4 - 1,340.58 (c) Long-term provisions 5 132.21 116.12 Current liabilities (a) Short-term borrowings 6 14,396.61 11,377.73 (b) Trade payables 7 7,551.16 6,181.12 (c) Other current liabilities 8 3,069.04 2,137.07 (d) Short-term provisions 9 42.32 59.89 37,942.55 38,578.09 ASSETS

Non-current assets (a) Fixed assets (i) Tangible assets 10 11,595.34 11,099.33 (ii) Intangible assets 10 1,132.58 1,047.67 (iii) Capital work-in-progress 10 4,600.41 1,496.02 (b) Non-current investments 11 - 1.19 (c) Long-term loans and advances 12 1,593.77 624.75

Current assets (a) Inventories 13 5,997.74 7,542.87 (b) Trade receivables 14 7,239.71 7,636.97 (c) Cash and bank balances 15 1,804.28 3,945.02 (d) Short-term loans and advances 16 3,978.72 5,184.26 37,942.55 38,578.09 Significant accounting policies and notes forming part of the Accounts 23As per our attached report of even date For and on behalf of the BoardFor S M N P & Co. Sd/– Sd/–Chartered Accountants G.Veera Bhadram M.K.Tandon(Registration No. 105929W) President & Whole time Director ChairmanSd/– Sd/– Sd/-Sunil S. Dayma Pritam Vartak N. ShankarPartner(M.No:F-100542) Company Secretary Head - Finance

Place : MumbaiDate : April 18, 2012

53

Annual Report 2011-12SaberoCONSOLIDATED STATEMENT OF PROFIT AND LOSS FOR THE YEAR ENDED 31, MARCH 2012

(` in lacs) As at As atParticulars Note 31-Mar-12 31-Mar-11

Revenue from operations 17 35,842.67 41,079.77

Other income 18 286.31 261.54

Total Revenue 36,128.98 41,341.31

Expenses:

Cost of materials consumed 23,657.62 25,753.20

Purchases of Stock-in-Trade 620.48 1983.40

Changes in inventories 19 (30.90) (1,468.86)

Employee benefits expense 20 2,322.44 1,997.31

Finance costs 21 2,812.91 1,547.64

Depreciation and amortization expense 10 1,103.93 860.09

Other expenses 22 13,348.06 8,925.81

Total expenses 43,834.54 39,598.59

Profit/(Loss) before tax (7,705.56) 1,742.72

Tax expense:

Current tax - 473.55

Deferred tax (1,340.58) 210.86

Profit/(Loss) after tax (6,364.98) 1,058.31

Minority Interest/loss of associate (0.22) (0.03)

Profit (Loss) for the period (6,364.76) 1,058.34

Earnings per equity share of ` 10/- each

Basic and diluted (18.80) 3.12 Significant accounting policies and notes forming part of the Accounts 23

As per our attached report of even date For and on behalf of the Board

For S M N P & Co. Sd/– Sd/–Chartered Accountants G.Veera Bhadram M.K.Tandon(Registration No. 105929W) President & Whole time Director Chairman

Sd/– Sd/– Sd/-Sunil S. Dayma Pritam Vartak N. ShankarPartner(M.No:F-100542) Company Secretary Head - Finance

Place : MumbaiDate : April 18, 2012

54

SaberoCONSOLIDATED CASH FLOW STATEMENT FOR THE YEAR ENDED 31, MARCH 2012

(` in lacs) As at As atParticulars 31-Mar-12 31-Mar-11

Cash flow from operating activitiesProfit before tax (7,705.56) 1,742.72 Adjustments for: Depreciation and amortisation expense 1,103.93 860.09 Profit on sale of fixed assets 87.06 - Foreign exchange fluctuation 247.90 (160.26) Unrealized Foreign Exchange on Consolidation (17.63) 139.98Interest expense 2,812.91 1,547.64

Operating profit before working capital changes (3,471.39) 4,130.17 Adjustments for: Increase/ (decrease) in trade payables 1,142.98 517.72 Increase/ (decrease) in other current liabilities 911.08 1,056.57 Increase/ (decrease) in other long-term liabilities (1.48) (518.15)Increase/ (decrease) in Margin money accounts 30.22 (320.60)Decrease/ (increase) in trade receivables 462.35 276.68 Decrease/ (increase) in inventories 1,545.13 (2,039.28)Decrease/ (increase) in long-term loans and advances (969.02) (624.75)Decrease/ (increase) in short-term loans and advances 1,220.26 (1,417.81)Cash generated from operations 870.13 1,060.55 Direct taxes paid (14.73) (473.55)Net cash flow from operating activities (A) 855.40 587.00

Cash flows from investing activities Purchase of fixed assets, including intangible assets, (5,325.93) (4,628.82)capital work-in-progress and capital advances Sale of fixed assets 449.62 - Purchase of non-current investments 1.19 0.00 Net cash used in investing activities (B) (4,875.12) (4,628.82)Cash flow from financing activities Proceeds from issue of equity shares 0.07 10.11 Proceeds from long-term borrowings 2,326.76 2,768.48 Repayment of long-term borrowings (567.25) - Increase/ (decrease) in short-term borrowings 2,941.38 4,928.15 Interest paid (2,791.76) (1,536.36)Net cash from financing activities (C) 1,909.20 6,170.38

Net increase/ (decrease) in cash and cash equivalents (A + B + C) (2,110.52) 2,128.56 Cash and cash equivalents at the beginning of the year 2,386.55 257.99 Cash and cash equivalents at the end of the year 276.03 2,386.55

As per our attached report of even date For and on behalf of the BoardFor S M N P & Co. Sd/– Sd/–Chartered Accountants G.Veera Bhadram M.K.Tandon(Registration No. 105929W) President & Whole time Director ChairmanSd/– Sd/– Sd/-Sunil S. Dayma Pritam Vartak N. ShankarPartner(M.No:F-100542) Company Secretary Head - Finance

Place : MumbaiDate : April 18, 2012

55

Annual Report 2011-12SaberoNOTES FORMING PART OF THE CONSOLIDATED FINANCIAL STATEMENTS

(` in lacs) As at As atParticulars 31-Mar-12 31-Mar-11

Note 1: SHARE CAPITALAuthorised: 3,60,00,000 ( 2011:-3,60,00,000)Equity Shares of `10/- each 3,600.00 3,600.00

Issued: 3,38,66,077(2011:3,38,66,077) Equity Shares of `10/- each 3,386.61 3,386.61

Subscribed and Paid-up 3,38,66,077(2011:3,38,66,077) Equity Shares of `10/- each 3,386.61 3,386.61 Less: Calls in arrears (1.10) (1.16) 3,385.51 3,385.45 (i) No. of Equity shares and amount outstanding at the beginning and at the end of the year. Year ended 31, March 2012 2011 Number ` in lacs Number ` in lacsPer last Balance sheet 33,866,077 3,385.45 33,809,105 3,379.75 Add: Issued during the year/calls in arrears - 0.06 56,972 5.70 Outstanding at the end of the year 33,866,077 3,385.51 33,866,077 3,385.45 (ii) As at 31, March 2012,Coromandel International Ltd (Holding Company) holds 24,798,112 (2011: Nil) of `10/- each

fully paid up representing 73.22% of the paid-up capital.(iii) During the year, Coromandel International Limited(Coromandel), pursuant to the approval from Securities Exchange

Board of India (SEBI) acquired 1,05,00,000 (31%) equity shares of the Company at a price of ` 160/- per share as part of the open offer made to the public share holders of the Company and also acquired 1,42,98,112 (42.22%) equity shares from the erstwhile promoters of the Company.

(iv) Shares held by each shareholder holding more than 5% of equity share capital.

Year ended 31, March 2012 2011(a) Coromandel International Ltd(Holding Company) 73.22% -(b) Kalah Corporation 7.50% 14.99%(c ) Mohit Chuganee - 9.51%(d) Hero Chuganee - 8.76%(e) Karville Company Limited - 14.81%

(v) During the period of five years immediately preceding the reporting date, there were no (a) shares allotted as fully paid up pursuant to contracts without payment being received in cash (b) shares allotted as fully paid up by way of bonus shares (c) shares bought back.(vi) 18390 (2011 18616), equity shares of ` 10 each were outstanding as calls unpaid from other than directors/ officers

of the Company.

56

SaberoNOTES FORMING PART OF THE CONSOLIDATED FINANCIAL STATEMENTS

(` in lacs) As at As atParticulars 31-Mar-12 31-Mar-11

Note 2: RESERVES AND SURPLUS i) Capital Reserve (Government Subsidy ) Per last Balance Sheet 24.46 24.46

ii) Securities Premium Reserve Account Per last Balance Sheet 1,370.97 1,366.55 Add: Received on account of share warrants - 4.42 1,370.97 1,370.97 iii) General Reserve Per last Balance Sheet 1,164.96 1,164.96

iv) Surplus as pe rthe statement of Profit & Loss Per last Balance Sheet 6,593.76 5,535.42 Add: Profit/(Loss) for the year (6,364.76) 1,058.34 229.00 6,593.76 v) Foreign Currency Translation Reserve 147.89 165.61 2,937.28 9,319.76 Note 3: LONG TERM BORROWINGSSecuredTerm Loans - Banks 7,506.85 5,120.75 - Others 8.25 106.85 7,515.09 5,227.60 - Less: Current maturities, disclosed in other current liabilities 1,086.79 567.25 6,428.31 4,660.35(i) The above term loans are secured by a first mortgage on the immovable properties both present and future and a

first charge by way of hypothecation of all the movables properties(save and except book debts), present and future, ranking pari-passu interse, subject to prior charges created in favour of the bankers on the inventories and other movable properties for securing the borrowings for working capital requirements.

(ii) Other loans are secured by way of hypothecation of vehicles acquired.(iii) During the previous year certain long term loans amounting to `1864.38 lacs were guaranteed by Mr. Sumit

Chuganee (erstwhile director) , `2340.50 lacs were guaranteed by both Mr. Mohit Chuganee and Sumit Chuganee and `930.80 lacs guaranteed by Mr. Hero Chuganee, Mr. Mohit Chuganee and Mr. Sumit Chuganee(erstwhile directors).

(iv) Terms of repayment of term loans and other loans as at reporting date is as under

Name of the bank Period of maturity Amount of installment No. of installmentsUBI Nov/13 12.50 20 FBL Oct/13 8.33 19 DENA Sep/13 4.17 18 IDBI Jul/12 25.00 1 EXIM Jan/16 43.75 16 AXIS-ECB Nov/15 146.25 16 RATNAKAR Jun/15 250.00 8

Rate of interest for the above loans ranges from 4%-18%

57

Annual Report 2011-12SaberoNOTES FORMING PART OF THE CONSOLIDATED FINANCIAL STATEMENTS

(` in lacs) As at As atParticulars 31-Mar-12 31-Mar-11

Note 4: DEFERRED TAX ASSETS/LIABILITIESDeferred Tax Liabilities

On account of depreciation 1484.82 1378.03 Research & Development Expenditure 0.75 0.12 'Product Development Expenditure 184.30 126.42 1,669.87 1,504.57Deferred Tax Assets On statutory dues allowable on payment basis 160.28 118.54 On employees separation and retirement cost 51.41 45.45 Business Losses carried forward 1,458.17 - 1,669.87 163.99

Net Deferred Tax Asset/(Liabilities) - 1,340.58

Deferred Tax Assets(`2404.49/- lacs) on carried forward losses(including depreciation )are recognised to the extent of Deferred Tax Liability considering the prudence aspect.

Note 5: LONG TERM PROVISIONS Employee Benefits(Refer note 23 B 8) for gratuity 96.79 80.96for compensated absences 35.42 35.16 132.21 116.12Note 6: SHORT TERM BORROWINGSSecured:Loans repayable on demand - from Banks 12,089.89 7,967.21Other loans from banks 2,205.73 3,299.37Dealer Deposits 100.99 111.15 14,396.61 11,377.73

(i) The above short term borrowings are secured by a first charge by way of hypothecation of all tangible assets including stocks of raw materials, work in process, finished goods and book debts and a second charge on the immovable properties, both present and future.

(ii) During the previous year, working capital loans and non fund based facilities amounting to `22000 lacs from consortium of banks viz Union Bank of India, Bank of India, Dena Bank, Federal Bank, Axis Bank, State Bank of India, Ratnakar Bank, Oriental Bank of Commerce and IDBI bank were further secured by personal guarantee of all 3 erstwhile directors of the Company, viz Mr. Hero Chuganee, Mr. Mohit Chuganee and Mr. Sumit Chuganee.

58

SaberoNOTES FORMING PART OF THE CONSOLIDATED FINANCIAL STATEMENTS

(` in lacs) As at As atParticulars 31-Mar-12 31-Mar-11

Note 7: TRADE PAYABLES - Acceptances 838.07 1,378.23 - Others 6,713.09 4,802.89 7,551.16 6,181.12Note 8: OTHER CURRENT LIABILITIES Current maturities of long-term debt 1,086.79 567.25 Creditors for capital goods 485.73 495.34 Interest accrued but not due on borrowings 32.44 11.29 Unpaid dividends 6.46 6.87 Other Liabilities 1,457.62 1,056.32 3,069.04 2,137.07Note 9: SHORT TERM PROVISIONS Employee Benefits 22.57 20.72 Income Tax (net) 15.25 38.83 Wealth Tax 4.50 0.34 42.32 59.89

59

Annual Report 2011-12SaberoNote 10: FIXED ASSETS

Tangible Assets Intangible Asset Grand Total

Capital work in prog-ress

Freehold land

Leasehold land

Build-ings

Plantand

equip-ment

furniture &

fixtures

Compu-ters

Vehi-cles

Office equip-ments

Ships Total Soft-ware

Product Develop-

ment

Total

Gross carrying amount:As at 1 April 2010

7.28 129.29 2,474.96 12,027.60 64.28 150.34 221.29 0.18 101.48 15,176.70 125.01 392.13 517.14 15,693.84

Additionsa - - 439.74 2,233.75 4.51 24.81 95.78 3.67 - 2,802.26 - 639.07 639.07 3,441.33 Disposal/ adjust-ments

- - - - - - - - - - - - - -

As at 31 March 2011

7.28 129.29 2,914.70 14,261.35 68.79 175.15 317.07 3.85 101.48 17,978.96 125.01 1,031.20 1,156.21 19,135.17

As at 1 April 2011

7.28 129.29 2,914.70 14,261.35 68.79 175.15 317.07 3.85 101.48 17,978.96 125.01 1,031.20 1,156.21 19,135.17

Additionsa - - 653.01 1,128.78 3.76 28.41 - 13.30 - 1,827.26 - 235.84 235.84 2,063.10 Disposal/ adjust-ments

- - 196.83 2.27 69.28 3.65 266.67 2.57 101.48 642.75 - - - 642.75

As at 31 March 2012

7.28 129.29 3,370.88 15,387.86 3.27 199.91 50.40 14.58 - 19,163.47 125.01 1,267.04 1,392.05 20,555.52

Accum-ulated depreciation/ impairment:As at 1 April 2010

- 12.75 623.86 5,207.70 47.91 93.87 108.95 0.00 0.14 6,095.18 11.77 21.14 32.91 6,128.09 -

Depre-ciation

- 1.31 82.79 638.40 4.08 26.46 24.12 0.12 7.17 784.45 20.26 55.37 75.63 860.08 -

Disposal/ adjust-ments

- - - - - - - - - - - - - -

As at 31 March 2011

- 14.06 706.65 5,846.10 51.99 120.33 133.07 0.12 7.31 6,879.63 32.03 76.51 108.54 6,988.17 -

As at 1 April2011

- 14.06 706.65 5,846.10 51.99 120.33 133.07 0.12 7.31 6,879.63 32.03 76.51 108.54 6,988.17 -

Depre-ciation

- 1.31 113.84 779.51 4.12 30.17 21.61 0.66 1.78 953.00 20.26 130.67 150.93 1,103.93 -

Disposal/ adjust-ments

- - 72.58 0.17 55.91 0.60 126.00 0.16 9.09 264.51 - - - 264.51

As at 31 March 2012

- 15.37 747.91 6,625.44 0.20 149.90 28.68 0.62 - 7,568.12 52.29 207.18 259.47 7,827.59 -

Net carrying amount As at 31st March 2012

7.28 113.92 2,622.97 8,762.42 3.07 50.01 21.72 13.96 - 11,595.34 72.72 1,059.86 1,132.58 12,727.92 4,600.41

As at 31st March 2011

7.28 115.23 2,208.05 8,415.25 16.80 54.82 184.00 3.73 94.17 11,099.33 92.98 954.69 1,047.67 12,147.00 1,496.02

Notes: a. Refer note 23 B-11 for preoperative expenses on projects, included in capital work-in progress

60

SaberoNOTES FORMING PART OF THE CONSOLIDATED FINANCIAL STATEMENTS

(` in lacs) As at As atParticulars 31-Mar-12 31-Mar-11

Note 11: NON CURRENT INVESTMENTS

Joint Venture CompanyMarkan Agroquimica LtdaNil (2011:4400) Equity Shares of R$ 0.10 each, fully paid up - 1.19 - 1.19Aggregated amount of unquoted investments - 1.19

Note 12: LONG TERM LOANS AND ADVANCESUnsecured, considered good:Capital advances 1,582.78 624.75Others 10.99 - 1,593.77 624.75Note 13: INVENTORIES Raw Materials(*) - in transit - - Others 2,164.19 3,223.65Work-in-process(**) 619.63 340.53Finished Goods (**) 3,076.68 3,324.88Stores & Spares(*) 192.78 683.81 6,053.28 7,572.87Less: Provision for obsolete stock (55.54) (30.00) 5,997.74 7,542.87(*) At or below cost(**)(At cost or net realisable value whichever is lower)

61

Annual Report 2011-12SaberoNOTES FORMING PART OF THE CONSOLIDATED FINANCIAL STATEMENTS

(` in lacs) As at As atParticulars 31-Mar-12 31-Mar-11

Note 14: TRADE RECEIVABLES

UnsecuredOutstanding for a period exceeding six months from due date : - Secured 15.57 37.18 - Unsecured, considered good 583.63 753.96 - Unsecured, considered doubtful 222.78 53.96 821.98 845.10 Less: Provision for doubtful debts 222.78 53.96 599.20 791.14Other debts - Secured 22.55 - - Unsecured 6,617.96 6,845.83

7,239.71 7,636.97

Note 15: CASH AND BANK BALANCES

Cash and cash equivalentsCash on hand 15.56 22.46

In Current Accounts 260.47 2,364.09 276.03 2,386.55Other bank balances - In Margin Money Account * 1,521.79 1,551.60 - In Unapid dividend account 6.46 6.87

1,804.28 3,945.02* Against Letter of Credit, Bills Discounted and Guarantees issued by the bank. Note 16: SHORT TERM LOANS AND ADVANCES(Unsecured, Considered good unless otherwise stated)Advances recoverable in cash or in kind or for value to be received Considered good 1,959.78 1,913.39

Considered doubtful 221.31 53.96Deposits 275.93 296.31Advances to related parties 9.93 16.89Others(with Government Authorities) 1,733.08 2,957.67 4,200.03 5,238.22Less Provision for doubtful advances (221.31) (53.96) 3,978.72 5,184.26

62

SaberoNOTES FORMING PART OF THE CONSOLIDATED FINANCIAL STATEMENTS

(` in lacs) As at As atParticulars 31-Mar-12 31-Mar-11

Note 17: REVENUE FROM OPERATIONSRevenue from OperationsSale of Products/services 36,489.34 42,439.77Less: Excise Duty 1,824.73 2,797.00 34,664.61 39,642.77Other Operating Revenues - Export incentives 1,012.57 1,280.65 - Others 165.49 156.35 35,842.67 41,079.77Note 18: OTHER INCOME Interest income 106.17 190.13Profit on sale of assets 105.18 -Others 74.96 71.41

Total 283.31 261.54

Note 19: CHANGE IN INVENTORIES

Stock as at April 1st Finished Goods 3,324.88 1,826.16 Work-in-process 340.53 370.39 3,665.41 2,196.55Stock as at March 31 Finished Goods 3,076.68 3,324.88 Work-in-process 619.63 340.53 3,696.31 3,665.41 (30.90) (1,468.86)Note 20: EMPLOYEE BENEFITS Salaries, Wages and Bonus 2,070.93 1,756.89Contribution to Provident & Other Funds 100.92 89.96Staff Welfare Expenses 150.59 150.46Total 2,322.44 1,997.31

63

Annual Report 2011-12SaberoNOTES FORMING PART OF THE CONSOLIDATED FINANCIAL STATEMENTS

(` in lacs) As at As atParticulars 31-Mar-12 31-Mar-11

Note 21: FINANCE COSTS

Interest expense 2,094.69 1,401.44Other borrowing costs 340.25 172.32Foreign Exchange Fluctuation on borrowings 377.97 (26.12) 2,812.91 1,547.64

Note 22: OTHER EXPENSES Power, Fuel and water 4,860.03 2,871.78Stores and consumables 986.12 1,017.55Rent 135.08 105.98Repairs to Plant and Machinery 228.62 269.23 Building 102.05 14.91 Others 53.99 15.63Insurance 135.93 145.62Rates and taxes 7.43 3.53Freight and distribution expenses 1,637.49 1,882.49Travelling and Conveyance 366.59 396.38Legal and Professional fees 415.79 290.74Directors' sitting fees 4.16 1.40Loss on sale of assets 18.11 -Provision for trade receivables 274.07 -Provision for doubtful advances 221.31 53.96Trade and other receivables, loans and advances written off 1,303.70 168.93Foreign Exchange Fluctuation-others 567.14 (391.95)Miscellaneous Expenses 2,030.45 2,079.63 13,348.06 8,925.81

64

SaberoNote No.-23

SIGNIFICANT ACCOUNTING POLICIES AND NOTES ON ACCOUNTS FOR THE YEAR ENDED 31ST MARCH 2012.

A. Significant accounting policies

1. Basis of preparation of financial statements

The financial statements have been prepared on the basis of going concern, under the historic cost convention on accrual basis, to comply in all material aspects with applicable Generally Accepted Accounting Principles in India (“Indian GAAP”), the Accounting Standards (“AS”) notified under Section 211 (3C) of the Companies Act, 1956 (“the Act”) and the relevant provisions of the Act.

2. Basis of consolidation

a) The consolidated financial statements are prepared by consolidating the accounts of Sabero Organics Gujarat Limited (the Company) with those of its subsidiaries and joint venture, which constitute the Group, in accordance with the Generally Accepted Accounting Principles and in consonance with the Accounting Standard 21- “Consolidated Financial Statements”, Accounting Standard 27 – “Financial Reporting of Interests in Joint ventures” and Accounting Standard 23 – “Accounting for Investments in Associates in Consolidated Financial Statements”.

b) The financial year of the group have been aligned with the Company and are drawn up to the same reporting date as of the Company i.e. year ended March 31, 2012.

3. Principles of Consolidation:

i. The financial statements of the parent Company and its subsidiaries have been combined on a line-by-line basis by adding together the book value of like items of assets, liabilities, income and expenses. Intra-group balances and intra-group transactions and resulting unrealized profits or losses if any have been fully eliminated.

ii. Consolidated financial statements have been prepared using uniform accounting policies for the like transactions and other events in similar circumstances are presented, to the extent possible, in the same manner as the Parent Company’s separate financial statements. Changes have been made in the accounting policies followed by the subsidiary to the extent they were material and identifiable from their respective audited accounts to make them uniform with the accounting policies followed by the Holding Company. In case the uniform accounting policy is not followed by each Company in the Group, the same, as disclosed in the provisional accounts of the said Company, are reproduced.

iii. In case of foreign subsidiaries, being non-integral operations, revenue items are consolidated at the average rate prevailing during the year. All assets and liabilities are converted at rates prevailing at the end of the year. Any exchange differences arising on consolidation is recognized in the foreign currency fluctuation reserve.

iv. The excess / deficit of cost to the parent Company of its investments in the Subsidiaries over its share of equity in the subsidiary companies, at the respective dates on which investment in the subsidiaries are made, is recognised as Goodwill/ Capital Reserve. The parent Company’s portion of equity in such subsidiaries is determined on the basis of book values of assets and liabilities as per the financial statements of the subsidiaries as on the date of investment.

v. Current assets / outside liabilities and income/ expenses of overseas subsidiaries and joint venture have been translated in reporting currency in terms of exchange rates prevailing on year-end date and average rate respectively on the basis of non-integral operation approach as per revised

AS-11 “The Effects of changes in Foreign Exchange Rates” ,there by accounting for the aggregate net impact of exchange fluctuation in this regard as Foreign currency translation reserve under the head Reserve and Surplus.

vi. Minority interest’s share of net profit is adjusted against the income to arrive at the net income attributable to shareholders. Minority interest’s share of net assets is presented separately in the Balance Sheet.

vii. The following subsidiaries are considered in the consolidated financial statements :

% voting power held

Sr. No.

Associate / Subsidiary Country of Incorporation

As at 31.03.12

As at 31.03.11

1 Sabero Australia Pty Ltd. Australia 100.00 100.002 Sabero Europe BV Netherlands 100.00 100.003 Sabero Organics

America S.A.Brazil 99.94 99.94

4 Sabero Argentina S.A. Argentina 95.00 95.00

4. Use of Estimates

The preparation of financial statements in conformity with the Generally Accepted Accounting Principles requires estimates and assumptions to be made that may affect the reported amount of assets and liabilities and disclosures relating to contingent liabilities as at the date of the financial statements and the reported amount of revenues and expenses during the reporting period. Management believes

65

Annual Report 2011-12Saberothe estimates used in the preparation of financial statements are prudent and reasonable. Actual results could differ from those estimated. Any revision to accounting estimate is recognized prospectively in the current and future periods.

5. Tangible Fixed Assets

Tangible Fixed Assets are stated at cost less accumulated depreciation. Cost comprises the purchase price and any attributable costs of bringing the asset to their working condition for their intended use.

6. Intangible Assets

Intangible Assets are recorded at their cost of acquisition. Cost of an internally generated asset, if any, comprises all expenditure that can be directly attributed, or allocated on a reasonable and consistent basis, to creating, producing and making the asset ready for its intended use.

7. Depreciation

Cost of leasehold land is amortised over the remaining period of lease after the commencement of commercial production.

Depreciation on other fixed assets is provided on Straight Line Method at the rates and in the manner specified in Schedule XIV to the Companies Act, 1956. Continuous process plants are classified on technical assessment and depreciation provided accordingly.

Depreciation on the Fixed Assets added/disposed off/discarded during the year is provided on pro-rata basis with reference to the month of addition / disposal/discarding.

8. Amortisation of Intangibles

The Intangible Assets are amortised on straight line basis based on their actual life of ten years whichever is lower.

9. Borrowing Costs

Borrowing costs attributable to the acquisition or construction of qualifying assets are capitalised as part of cost of such asset up to the date when such asset is ready for its intended use. Other borrowing costs are recognised as an expense in the period in which they are incurred.

10. Investments

Investments which are readily realizable and are intended to be held for not more than one year from the date, on which such investments are made, are classified as current investments. All other investments are classified as long term investments.

Long-term investments are carried at cost of acquisition. Provision is made only when in management’s opinion there is a decline, other than temporary, in the carrying value of such investments. Current investments are valued at lower of cost and market value.

11. Inventories

Raw materials and Stores and spares are valued at or below cost. Other inventories are valued at lower of cost and net realizable value. The method of determination of cost of various categories of inventories is as follows:

Raw Materials : weighted average cost, cost includes purchase cost and attributable expenses.

Finished Goods & Work-in-process: weighted average cost of production, which comprises of direct material costs, direct wages and applicable overheads. Excise duty is included in the value of finished goods. The obsolete, defective and unserviceable stocks and duty are provided for whenever required.

Store & Spares : Weighted average cost

Stock in Trade : Weighted average cost

12. Foreign Currency Transactions

Transactions made during the year in foreign currency are recorded at the exchange rate prevailing at the time of transactions. Monetary assets and liabilities relating to foreign currency transactions remaining unsettled at the year-end are translated at the exchange rate prevalent at the date of Balance Sheet. Exchange differences arising on actual payment/ realisation and year end reinstatement referred to above are recognised in the Statement of Profit and Loss.

13. Revenue Recognition

The Company recognises Sales at the point of dispatch of goods to the customers which coincides with the transfer of risks and rewards. Sales include amount recovered towards Excise Duty and exclude Sales tax and Value added tax. Interest income is accounted for on accrual basis.

14. Taxation

Provision for Taxation is made for the current accounting period (reporting period) on the basis of the taxable Income as determined in accordance with the provision of Income Tax Act, 1961.

Deferred Tax resulting from timing differences between book and tax profits is accounted for under the liability method using the tax rates and laws that have been substantively enacted as of the Balance Sheet date, to the extent that the timing differences are expected to crystallize.

66

SaberoDeferred tax assets are recognised only to the extent there is reasonable certainty that the assets can be realized in future. However, where there is unabsorbed depreciation or carried forward loss under taxation laws, deferred tax assets are recognised only if there is a virtual certainty of realisation of such assets. Deferred tax assets are reviewed as at each Balance Sheet date and written down or written up to reflect the amount that is reasonably/virtually certain to be realized.

15. Government Grants

Grants relating to Fixed Assets in the nature of project capital subsidy are credited to Capital Reserve.

16. Retirement Benefits:

Defined contribution plans

Contributions paid/payable to defined contribution plans comprising Provident Funds for employees covered under the Scheme are recognised in the Statement of Profit and Loss each year.

The Company makes contributions to Recognised Provident Fund for employees, at a specified percentage of the employees’ salary. The Company does not have any other obligation apart from making contributions to the fund.

Defined benefit plans

Gratuity for employees is covered under a Scheme of Life Insurance Corporation of India (LIC) and contributions in respect of such scheme are recognised in the Statement of Profit and Loss. The liability as at the Balance Sheet date is provided for based on the actuarial valuation carried out as at the end of the year.

Other long term employee benefits

Other long term employee benefits comprise of leave encashment which is provided for based on the actuarial valuation carried out as at the end of the year.

17. Earnings per Share

Basic earning per share is calculated by dividing the net profit for the period attributable to equity shareholders by the weighted average number of equity shares outstanding during the period. The weighted average number of equity shares outstanding during the period is adjusted for events of subsequent issue of shares.

For the purpose of calculating diluted earnings per share, the net profit for the period attributable to equity shareholders and weighted average number of shares outstanding during the period is adjusted for the effects of all dilutive potential equity shares.

18. Impairment of Assets

The carrying amounts of the Company’s assets are reviewed at each Balance Sheet date. If any indication of impairment exists, an impairment loss is recognised to the extent of the excess of the carrying amount over the estimated accountable amount.

19. Provisions, Contingent Liabilities and Contingent Assets

Provisions are recognised in the accounts in respect of present probable obligations, the amount of which can be reliably estimated.

Contingent Liabilities are disclosed in respect of possible obligations that arise from past events but their existence is confirmed by the occurrence or non occurrence of one or more uncertain future events not wholly within the control of the Company.

A Contingent asset is neither recognized nor disclosed in the financial statements.

B.NOTES ON ACCOUNTS.

1. During the year, Coromandel International Limited (Coromandel), pursuant to the approval from Securities Exchange Board of India (SEBI) acquired 1,05,00,000 (31%) equity shares of the Company at a price of ` 160/- per share as part of the open offer made to the public shareholders of the Company and also acquired 1,42,98,112 (42.22%) equity shares from the erstwhile promoters of the Company. With the said acquisition Coromandel, now along with its subsidiary Parry Chemicals Limited holds 74.57% of the equity capital of the Company.

2. Basic & Diluted Earnings per Share:

Year ended March 31,2012 2011

1. Profit/(loss) after tax (` In Lacs) - [a]

(6,364.76) 1,058.34

2. Weighted average number of Equity shares of `10/- each outstanding during the year. – [b]

3,38,66,077 33,862,019

Earnings Per share (`)3. Basic & diluted - [a]/[b] (18. 80) 3.12

3. Contingent Liabilities and commitments:

a) Contingent Liabilities :

a) Claim against Company not acknowledged as debts

Year ended March 31,2012 2011

IncomeTax 474.95 179.18Sales Tax 148.22 -Excise Matters 51.21 -Others(legal cases) 130.61 -

67

Annual Report 2011-12Saberob) Bills Discounted and outstanding: `3,933.75 lacs

(2011-`5,613.11 lacs), since realized `554.27 lacs (2011-` 2,348.05 lacs).

c) Bank Guarantees outstanding ` 695.23 lacs (2011- ` 475.40 lacs)

b) Commitments :

Year ended March 31,2012 2011

Capital Commitments 4,106.10 4,317.74Other Commitments – –5.Consolidated Accounts of Subsidiary Companies

5.1 The financial year of the subsidiaries have been aligned with the parent Company and are drawn up to the same reporting date as of the Company i.e. year ended March 31, 2012.

5.2 The Company has consolidated its accounts with its subsidiary companies viz. Sabero Argentina S.A., Sabero Europe B.V., Sabero Australia Pty. Ltd., and Sabero Organics America S.A. While the provisional accounts of all the companies were provided to us and were accordingly consolidated as per the recommendations of Accounting Standard - 21 Consolidated Financial Statements.

5.3 Intangible assets of a subsidiary Sabero America S.A. includes expenses amounting to ` 712.21 Lacs (Previous Year 574.11 Lacs) incurred in relation to Product registration, organizing and constitution of the Company and general administrative expenses incurred after their formation. In the opinion of the management the amoritisation would be done from the year in which the Company starts generating profit.

6. Investments in Joint Venture

During the year, the Company and its subsidiary Sabero Organics America S.A. has entered into an settlement agreement with Embrasil, Brazil and Markan Agroquimica Ltd, Brazil (Markan), with the said settlement, the Company is no longer a co-venturer in Markan.

7. There are no reported cases of dues payable to Micro, Small and Medium Enterprises for more than 45 days, and hence there is no need for provision of interest in current year. The same is based on the information available with the Company and relied upon by the Auditors.

8. Keeping in view of the losses incurred by the Company during the current year the remuneration to the directors is governed by the relevant provisions of Schedule XIII to the Companies Act, 1956. Managerial remuneration paid during the current year amounting to `87.73 lacs is in excess of the limits so prescribed. The Company has since applied to Central Government for approval of the said amount paid.

9. Product registration expenses, hitherto grouped

under miscellaneous expenditure have been regrouped under Intangible assets.

10. Consequent to the completion of reconciliation of major balances under various assets and liabilities, the company has charged off to revenue Rs.2818.13 lacs (2011 - Rs.586.85 lacs) under respective heads of accounts.

11. Segment Reporting:

a) Business Segment

The Company’s main business is to manufacture and sale Crop Protection Chemicals and Inputs. All other activities of the Company are incidental to the main business. As such, there is no separate reportable segment as per the Accounting Standard 17 Segment Reporting.

b) Geographical Segment

The Company’s operating facilities are located in India. The segmental reporting for the Secondary Segment – Geographical as per the Accounting Standard 17 Segment Reporting.

` (In Lacs)

Year ended March 31, 2011-12 2010-11

Domestic Revenue 17,068.67 18,590.44 Export Revenue (Including Export benefits) 18,774.00 22,489.33Total 35,842.67 41,079.7712. Related Party disclosures

Related party disclosures, as required by Accounting Standard 18, Related Party Disclosures, are given below.

a) Names of the related parties and their relationship:

Names Nature of relationshipCoromandel International Limited Holding Company

(w.e.f. 17th December 2011)Sabero Echostar (India) Pvt Ltd* Directors in commonHarvard Finance Co.Pvt Ltd.* Directors in commonWhite Waves Capital LLP* Directors in commonTranquilitta Capital Advisors Private Limited* Directors in commonMosum Enterprises Ltd* Directors in commonMr. Mohit H.Chuganee* Key Management PersonnelMr. Hero Chuganee* Key Management PersonnelMrs. Sabita H Chuganee* Relative of DirectorMr. Sumit H. Chuganee* Key Management PersonnelMr. Rajesh Sharma# Key Management PersonnelMr. Ashok Muni @ Key Management PersonnelMr. G. Veera Bhadram** Key Management PersonnelNote : *Ceased to exist as related parties effective 17th

December 2011. ** W.e.f. 19th December 2011.

68

Sabero# Exist till 7th September 2011.

@ Exist till 19th December 2011.

$ Ceased to exist as related party effective 3rd October 2011.

The above Related parties are as identified by the Company and relied upon by the Auditors.

b) Transactions with Related Parties:

During the year, the following transactions were carried out with the related parties in the normal course of the business:

Nature of Transaction

Key Management Personnel

Relatives of Key Management Personnel

Year ended March 31,

2012

Year ended March 31,

2011

Year ended March 31,

2012

Year ended March 31,

2011Purchase of Fixed Assets

470.69 - -

Purchase of Services(Excluding service tax)

46.94 45.87 12.60 16.80

Sale of Fixed Assets

240.00 - - -

Remu-neration

254.19 137.29 - -

Sitting Fees 4.16 1.40 -Commission - 21.00 - -

c. Outstanding balances as on 31st March 2012

Nature of Transaction

Key Management Personnel

Relatives of Key Management Personnel

Year ended March 31,

2012

Year ended March 31,

2011

Year ended March 31,

2012

Year ended March 31,

2011Payables 15.48 30.24 - 1.52Receivables - 0.62 - 12.60

13. Pre-operative Expenses pending allocation (included in Capital Work –in- progress)

(` In Lacs)

Year ended March 31,

2012 2011Opening Balance 440.83 247.51

Add: Incurred during the YearEmployee Benefits expense 166.31 108.00Borrowing Costs(*) 101.06 49.09Other expenses 110.71 36.23Total 378.08 193.32Closing Balance 818.91 440.83

(*) Net of income of ` 47.82lacs (2011-nil).

14. The Company believes that no impairment of assets arises during the year as per the recommendations of Accounting Standard - 28 Impairment of Assets, issued by the Institute of Chartered Accountants of India considering the age of the Fixed Assets situated at its Sarigam unit.

15. In view of common pool of facilities for research and development activities, the research and development expenditure is not identifiable separately.

16. Previous Year’s figures are regrouped/rearranged wherever considered necessary to conform to current year’s presentation.

69

Annual Report 2011-12SaberoSTATEMENT PURSUANT TO EXEMPTION RECEIVED UNDER SECTION 212(8) OF

THE COMPANIES ACT, 1956 RELATING TO SUBSIDIARY COMPANIES

Particulars Sabero Australia Pty Ltd.

Sabero Organics America S. A.

Sabero Europe B. V. Sabero Argentina S, A. Argentina

Year ended March 31,2012

Year ended March 31,2012

Year ended March 31,2012

Year ended March 31,2012

Share Capital 0.74 943.52 18.79 19.79

Reserves & Surplus (14.33) (241.99) (19.06) (12.06)

Non-current liabilities

Current liabilities 14.90 13.01 1.77 4.08

Total Equity and Liabilities

1.31 714.54 1.50 11.81

Fixed assets - 713.43 - -

Non-current investments

Current assets 1.31 1.11 1.50 11.81

Total Assets 1.31 714.54 1.50 11.81

Turnover/other income - - 6.74

Profit Before tax - (241.99) (0.95) 2.32

Provision for tax - - - -

Proposed Dividend - - - -

(` In Lacs)

THIS PAGE IS IN

TENTIONALLY

KEPT B

LANK

SABERO ORGANICS GUJARAT LIMITEDRegistered Office: Plot No. 2102, GIDC, Sarigam - 396 155, Dist. - Bulsar, Gujarat.

ATTENDANCE SLIP

PLEASE COMPLETE THIS ATTENDANCE SLIP AND HAND IT OVER AT THE ENTRANCE OF THE HALL. ONLY MEMBERS OR THEIR PROXIES ARE ENTITLED TO BE PRESENT AT THE MEETING

R.F.NO./CLIENT ID: DP ID:

NAME AND ADDRESS :

I hereby record my presence at TWENTY FIRST ANNUAL GENERAL MEETING to be held on Friday, July 13, 2012 at 12.30 P.M at Plot No. 2102, GIDC, Sarigam - 396 155, Dist. - Bulsar, Gujarat.

NAME OF PROXY IN BLOCK LETTERS SIGNATURE OF THE MEMBER/PROXY*

*Strike out whichever is not applicable

-------------------------------------------------------------TEAR OFF HERE-------------------------------------------------------------------

SABERO ORGANICS GUJARAT LIMITEDRegistered Office: Plot No. 2102, GIDC, Sarigam - 396 155, Dist. - Bulsar, Gujarat.

PROXY FORMI/We____________________________________________________ of__________________________________

Being a Member/Members of Sabero Organics Gujarat Limited hereby appoint________________________________

_______________________________________ of__________________________________________________

or failing him_________________________________ of______________________________________________

or failing him_______________________________________of_________________________________________as my/our Proxy to attend and vote for me/us in the manner indicated below* and on my/our behalf at the TWENTY FIRST ANNUAL GENERAL MEETING of the Company to be held at 12.30 P.M on Friday, July 13, 2012 and at any adjournment thereof.

* ‘For’ Item Nos. : ____________________________________________* ‘Against’ Item Nos. _________________________________________:Dated this ________________________ day of _______________ 2012

Signature of the Member(s) _________________________

1. In the case of Corporation, this Proxy shall be either given under the Common Seal or signed by an Attorney or Officer of the Corporation.

2. Proxy to be valid must be deposited at the Registered Office of the Company not later than 48 hours before the time for the meeting.

3. * This is only optional. Please fill up the item Nos. as appearing in the notice of the AGM. If you leave the item Nos. blank, your proxy will be entitled to vote in the manner as he/she thinks appropriate.