DCW Ltd. - Annual Report - 2007-2008

8/7/2019 DCW Ltd. - Annual Report - 2007-2008

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‘100 YeARS oF InSpIRAtIon’

“Padma Bhushan”Sahu Shriyans Prasad Jain

1908-1992

Our Founder Chairman

Born on November 3 1908, Sahu Shriyans Prasad Jain has been the most important source of inspiration to the

Company owing to which it is being run successfully even today.Not only was Mr. Jain an industrialist far ahead of his time buthe was also a leader, a philanthropist, an activist and a visionarywhose contribution to the country in the fields of education,health care, social welfare and commerce have been far reachingtill today. On his centenary year we wish to pay tribute to this

truly noble Indian.



DCW Limited • Annual Report 2007-2008 1

LIMITED

BOARD OF DIRECTORS

Dr. Shashi Chand JainChairman and Managing Director

Smt. Satyawati Jain

Shri F.H. Tapia

Dr. V.H. Joshi

Shri Yuvaraj Saheb of Dhrangadhra

Shri Sushil Kumar Jalan

Shri R.V. Ruia

Shri Pramod Kumar JainManaging Director

Shri Bakul JainManaging Director

Smt. Vandana JainExecutive Director

BANKERS

Punjab National Bank

State Bank of India

State Bank of Saurashtra

City Union Bank Ltd.

ING Vysya Bank Ltd.

Corporate Directory

AUDITORS

V. Sankar Aiyar & Co.,Chartered Accountants, Mumbai.

REGISTERED OFFICEDhrangadhra 363 315, Gujarat.

HEAD OFFICE

“Nirmal”, 3rd Floor,Nariman Point,Mumbai 400 021.

BRANCH OFFICEIndra Palace, 1st Floor,H-Block, Connaught Circus,New Delhi 110 001.

WORKS

Soda Ash Division : Dhrangadhra 363 315,Gujarat.

Caustic Soda Division : Arumuganeri P.O.,Sahupuram 628 202,

Tamil Nadu.PVC Division : Arumuganeri P.O.,

Sahupuram 628 202,Tamil Nadu.

Salt Works : Kuda, Gujarat.Arumuganeri P.O.,Sahupuram 628 202,Tamil Nadu.

69th

Annual Report 2007-2008

Note: The Balance Sheet, Prot and Loss Account and Key Financial Data are also presented in US $ on Page Numbers 15, 16 & 17 respectively.



2 DCW Limited • Annual Report 2007-2008

LIMITED Directors’ Report

TO THE MEMBERS

Your Directors present their 69thAnnual Report and Audited Accountsfor the Financial Year ended31st March, 2008:

1. Financial Results:

31-3-2008(Rs. in lacs)

31-3-2007(Rs. in lacs)

Sales 86,364.96 75,419.82

GrossProt 8,095.84 5,668.78Less : Provisions

Depreciation 3,002.85 2,532.88

ProtbeforeTax 5,092.99 3,135.90

Tax: Current 575.00 347.24

FringeBenetTax 60.00 73.58

MAT Creditavailable forset off (155.00) (44.90)

480.00 375.92

ProtafterCurrent Tax &Tax Adjustments 4,612.99 2,759.98

Deferred Tax 1,033.73 743.07

ProtafterTax 3,579.26 2,016.91

Add: Balancebrought forward 2,440.53 3,027.73

Protavailable for Appropriation 6,019.79 5,044.64

Appropriations :

General Reserves 2,000.00 2,000.00

Dividend

Interim 345.09

Final/Proposed 588.46 172.54

DividendDistribution Tax 100.01 86.45

Balance carriedforward 3,331.32 2,440.56

2. Dividend:

Your Directors recommendpayment of Dividend atRe. 0.30 per equity share of Rs. 2/- each.

3. Operations:

Sales during the year wereRs. 863.65 crores as comparedto Rs. 754.20 crores recorded inthe previous year, registering an

increase of 14.51%. The GrossProt for the year increased from Rs. 56.69 crores toRs. 80.96 crores. The protbefore tax amounted toRs. 50.93 crores as againstRs. 31.36 crores in the previousyear. After providing Rs. 4.20crores for current taxes andRs. 0.60 crores towards Fringebenet taxes, the prot before

deferred tax is Rs. 46.13 crores asagainstRs.27.60crores.Theprotafter provision of deferred tax isRs. 35.79 crores against previousyears Rs. 20.17 crores. DeferredTax is only a provision as perguidelinesandisnotanoutow.

4. Exports:

The Company’s exports areRs. 91.17 crores as compared toRs. 71.67 crores in the previousyear. This 28.48% increase in

exports was mainly on account of increase inBenecated Ilmeniteexports coupled with betterprice realization on BenecatedIlmenite.

5. Divisionwise Performance:(a) PVC Division

The turnover of the divisionwas Rs. 455.14 crores ascompared to Rs. 372.18

crores, registering an increaseof 22.29%. This increase insales was mainly on accountof better realization on PVC.The company sold 84142MT of PVC resin comparedto 76641 MT in the previousyear. All major user segmentsare recording good demandand PVC industry continuesto show positive growth. The

Government has identiedirrigation, power andinfrastructure, as thrust areasand increased activity in thesesectors are likely to boostdemand of PVC Resin.

(b) Caustic Soda Division The turnover of thedivision was Rs. 233.02crores as compared toRs. 217.55 crores in theprevious year, registering anincrease of 7.08% in the sales.This increase in turnoverwas mainly due to betterprice relisation on CausticSoda during the year. Theproduction of Caustic Sodawas 63025 MT as comparedto 56210 MT in the previousyear.




LIMITED

(c) Soda Ash Division

The turnover of the divisionwas Rs. 168.16 crores ascompared to Rs. 157.16 croresin the previous year registering

a growth of 7%. The companyproduced 81248 MT of SodaAsh (previous year 80816MT), 16050 MT of Soda BiCarb (previous year 18299MT) and 446 MT of AmmoniaBi Carbonate (previous year1599 MT) during the year.The Company also produced41316 MT of detergents(previous year 35913 MT).

6. Company had in January’08decided to raise capital byplacement of equity withQIB’s. In view of the marketconditions, same has been kepton hold and will be taken up atappropriate time. This is alsothe view taken by corporatesector for raising fresh / additional

capital.

7. Projects Implemented and Under

Implementation

7.1 Conversion of Mercury Cells

to Membrane Cells in CausticSoda

The project of switchingover from the mercury cells

to the membrane cells forcaustic soda production,has been successfullycompleted during the yearwith enhanced capacity from175 TPD to 285 TPD. This isanenergyefcientplantwithconsiderable saving in powerconsumption and no mercurypollution.

7.2 Thermal Power Plant

The Project of Thermal Co-generation for generating50MW of power and 85 TPHsteam at its Sahupuram unit

is being executed on turn keybasisbyThermaxLtd.TherstSTG of the 2 x 25 MW CogenSet is scheduled to generatepower by second half of May’08 and the Second STGof the same is expected to beon stream by June / July 2008.This Thermal Cogen Powerplant will bring down the costof power and steam.

7.3 Solway Towers at

Dhrangadhra Unit

Solway towers installed atthe Soda Ash Unit will becommissioned when theexpansion of Soda Ash Plantto 450 / 600 TPD is taken up.

7.4 Calcium Chloride Plant

The capital expenditure onthe Calcium Chloride willbe debited to a similar plantscheduled to be put up at

Sahupuram as an adjunctto the proposed iron oxideplant.

8. Corporate Governance:

The report on CorporateGovernance is annexed to thisreport.

9. Conservation of Energy,Technology Absorption and

Foreign Exchange Earnings andOutgo:

Information pursuant to Section217 (1) (e) of the Companies Act,1956, read with the Companies(Disclosure of Particulars in theReport of the Board of Directors)Rules, 1988 is set out in theAnnexure forming part of thisReport.

10. Particulars of Employees:

Information in accordancewith Section 217 (2A) of theCompanies Act, 1956, read withthe Companies (Particulars of Employees) Rules, 1975 is set outin the Annexure forming part of this Report.

11. Environment and Safety

Measures:The Company is committed toIndustrial Safety and EnvironmentProtection and these are on goingprocesses at the Company’svarious plants. The SahupuramUnit has been granted ISO 14001Certicate for complying withenvironment protection andsafety.




LIMITED

12. Directors:

Shri Bakul Jain, Shri S. K.Jalan and Smt. Satyawati Jain,Directors, retire by rotationat the forthcoming Annual

General Meeting, and beingeligible, offer themselves forreappointment.

13. Auditors and Auditors’ Report:

M/s V. Sankar Aiyar & Co.,Chartered Accountants, StatutoryAuditors, of the Company retire atthe forthcoming Annual GeneralMeeting and are eligible forreappointment. Regarding the

Qualication in the AuditorsReport, the notes to the accountsreferred to in the Auditors Reportare self explanatory and do notcallforanyfurtherclaricaitons.

14. Cost Audit:

In accordance with the directionsreceived from the Ministry of Corporate Affairs, the Cost Audit

of the Company’s Soda Ash andCaustic Soda Divisions are beingconducted for the Financial Year2007-2008 by Cost Auditors,M/s. N.D. Birla & Company andM/s. R. Nanabhoy & Companyrespectively. Their appointmentswere approved by the Ministry of Corporate Affairs. The Cost Auditof these Divisions is conductedevery year and the Reports are

submitted by the Cost Auditors tothe Central Government.

15. Management Discussion and

Analysis Report:

Outlook:

The Company has a diversiedoperation with three businesssegments viz. PVC, ChloroAlkali and Soda Ash. It is thus

reasonably protected from thevagaries of business cycles of these products.

PVC Division:

The Company, one of the six

producers of the PVC resin, hasmaintained its market share of nearly 10%. With introductionof Value Added Tax (VAT) inTamilnadu and Pondicherryfrom January’07, the Company’scompetitiveness andprotabilityhas improved. Also with thecommissioning of Thermal Co-Generation plant at Company’sSahupuram unit, the cost of power

and steam used for manufacturingPVC will come downstrengthening the bottomline.

Caustic Soda Division:

The company continues to be amajor player in South India witha market share of approximately15%. The demand for caustic sodais expected to grow at a steady rate

of 4% to 5% over the next 3 yearsspecially with increased demandfrom aluminium manufacturers.

The conversion from Mercury Cell

to Membrane Cell in this divisionwhich got completed duringthe year has not only resultedin substantial capacity additionbut also has brought down theconsumption of power in thisdivision which will improve thebottomline.

The capacity addition inBeneciatedIlmenitewithbetter

realization will help in increasedturnoverandwillalsobenetthebottom line.

Soda Ash Division:

The Soda Ash Industry continuesto grow at a compounded rate of 4 % to 5% per annum and thistrend is expected to continuedue to strong demand from end-user industries with better sales

realization.

Internal Control Systems:

The Company has an adequateinternal control procedurecommensurate with the natureof its business and size of itsoperations. Internal Audit isconducted at regular intervals.Internal Audit is conducted on aregular basis by an independentrm of Chartered Accountants.However the Board of Directorsare re-examining the scope of Internal Audit looking into the sizeof operations of the Company.

The reports of the internal auditalong with comments from themanagement are placed forreview before Audit Committee.




LIMITED

The Audit Committee alsoscrutinizes all the programmesand the adequacy of the internalcontrols.

Human Resources:The Company has beenfollowing a standard procedurefor recruitment of best personnelfor all the departments and ismaking constant and continuousefforts to retain and groomthem to meet its present andfuture requirements. The currentstrength is 2346 employees. TheCompany sponsors employees

forvariousseminars onnance,operations, marketing and humanresource development to updatetheir skills and develop close co-ordination with their counterpartsin industries. This is basicallydone to enhance their skills inorder to achieve an optimumoutput from them.

Cautionary Note:Statement in this reportdescribing the company’sobjectives, projections, estimates,expectations and predictions maybe “forward looking statements”.Actual results could differmaterially from those expressed orimplied due to variation in prices

of raw materials, cyclical demandand pricing in the Company’sprincipal markets, changes inGovernment regulations, taxregimes, economic developments

within India and other incidentalfactors.

16. Directors’ ResponsibilityStatement:

In terms of Section 217 (2AA) of the Companies Act, 1956 yourDirectors have:

(a) Followed in the preparationof the Annual Accounts,the applicable accounting

standards with properexplanation relating tomaterial departures;

(b) selected such accountingpolicies and applied themconsistently and madejudgements and estimates thatare reasonable and prudentso as to give a true and fairview of the state of affairs of

your Company at the end of nancialyearandoftheprotof your Company for thatperiod;

(c) taken proper and sufcientcare for the maintenance of adequate accounting recordsin accordance with theprovisions of the Companies

Act, 1956 for safeguarding theassets of your Company andfor preventing and detectingfraud and other irregularities;and

(d) Prepared the Annual Accountson a going concern basis.

17. Insurance:

All the properties of the Companyare adequately insured.

18. Industrial Relations:

The relations between theemployees and the management

were cordial and an atmosphereof understanding prevailedthroughout the year.

19. Acknowledgement:

The Board places on recordtheir grateful appreciation forthe assistance and co-operationreceived from the FinancialInstitutions and the Banks.

On behalf of theBoard of Directors

Dr. Shashi Chand JainChairman and Managing

Director

Mumbai, 16th May, 2008




LIMITED Annexure to Directors’ Report Report on Corporate Governance

(Pursuant to Clause 49 of the Listing Agreement)

A. MANDATORY REQUIREMENTS:

1. Company’s philosophy on Code of Corporate Governance:

The Company believes in the practice of good Corporate Governance. A continuous process of delegation of powerscommensurate with accountability coupled with trust, faith and transparency has been embedded in the day to dayfunctioning. The Company will endeavor to improve on these aspects on an ongoing basis.

2. Board of Directors:

• SizeoftheBoard:

The Board of Directors of the Company consists of 10 Directors.

• Composition,categoryandtheirattendanceattheBoardmeetingsduringtheyearandatthelastAnnualGeneralMeetingasalsothenumberofotherDirectorships/MembershipsofCommitteesareasfollows:

Category of Directorship Name of the Director

Attendance Particularsat the

OtherDirectorships

Other Committee

BoardMeetings

LastAGM

Memberships Chairmanships

Promoter/ExecutiveDirectors

Dr. Shashi Chand Jain(Chairman &Managing Director)

7 No 4 2

Shri Pramod Kumar Jain(Managing Director)

7 Yes 1

Shri Bakul Jain(Managing Director)

5 No 2

Smt. Vandana Jain

(Executive Director)

7 No

Promoter/Non-ExecutiveDirector

Smt. Satyawati Jain* 6 No

Non Executive andIndependent Directors

Shri Yuvaraj Saheb of Dhrangadhra

7 No

Shri F. H. Tapia 6 No

Dr. V. H. Joshi 6 Yes

Sushil K. Jalan 6 No 5

Shri N. R. Ruia** 0 No

Shri R. V. Ruia*** 6 NA 4 * Holds 1,04,000 Equity Shares of Rs. 2 each of the Company.

** Ceased to be a Director w.e.f. April 22, 2007.

*** Appointed as a Director w.e.f. May 19, 2007.

• No.ofBoardMeetingsheldduringtheyearalongwiththedatesofthemeeting:

During the year seven Board Meetings were held on:

20.04.2007, 19.05.2007, 19.06.2007, 24.07.2007, 24.10.2007, 15.01.2008 and 28.01.2008.

The Company placed before the Board the Annual Budget, Performance of various units and other informationfrom time to time as specied in Annexure of the Listing Agreement.




LIMITED

3. Audit Committee:

• TermsofReference:

The terms of reference of this Committeecover the matters as specied for AuditCommittees under Clause 49 of the ListingAgreement as well as per the provisionsof Section 292 A of the Companies Act,1956.

• Composition, name of Members andChairperson:

The Audit Committee comprises 3Non-Executive Independent Directors.Dr. V. H. Joshi is the Chairman of thisCommittee. Shri Yuvaraj Saheb of Dhrangadhra and Shri F. H. Tapia are theother members of the Committee.

• MeetingsandAttendanceduringtheyear:

The Committee met 4 times during the yearand the attendance of the Members at thesemeetings was as follows:

Dates of Meetings

Dr. V. H. Joshi Shri F. H. Tapia Shri YuvarajSaheb of Dhrangadhra

19.05.2007 Yes No Yes24.07.2007 Yes Yes Yes24.10.2007 Yes Yes Yes28.01.2008 Yes Yes Yes

4. Remuneration Committee:

• TermsofReference:

The terms of reference of this Committeecover the matters as specified forRemuneration Committees under Clause

49 of the Listing Agreement.

• Composition, Name of Members andChairperson:

The Remuneration Committee comprises3 Non-Executive Independent Directors.Shri F. H. Tapia is the Chairman of this Committee. Dr. V. H. Joshi andShri Yuvaraj Saheb of Dhrangadhra are theother members of the Committee.

• Attendanceduringtheyear:

There were no Remuneration Committeemeetings during the year.

• RemunerationPolicy:

The Remuneration of Managing Directorsand Whole-time Director is approved bythe Remuneration Committee and alsoby the Board (subject to the subsequentapproval by the Shareholders at the general

body meeting and such other authoritiesas the case may be). The remuneration isfixed considering various factors such asqualification, experience, expertise, andprevailing remuneration in the corporateworld, nancial position of the Company etc.The remuneration Structure comprises Salary,Perquisites, Commission, and Contributionto Provident Fund, Super-Annuation Fundand other funds in accordance with theprovisions of the Companies Act, 1956.The Non-Executive Directors do not drawany remuneration from the Company

besides the sitting fees for each meeting of the Board, Audit and RemunerationCommittees attended by them.

Directors Salary

(Rs.)

Benets

(Rs.)

Contribution toProvident Fund& Other funds

(Rs.)

Commission

(Rs.)

Sitting Fees

(Rs).

Total

(Rs.)

Dr. Shashi Chand Jain 24,00,000 8,99,999 7,20,960 70,92,000 1,11,12,959

Shri Pramod Kumar Jain 24,00,000 8,99,949 7,20,960 70,92,000 1,11,12,909

Shri Bakul Jain 24,00,000 8,99,783 7,20,960 70,92,000 1,11,12,743

Smt. Vandana Jain 24,00,000 8,99,762 72,960 70,92,000 1,04,64,722Smt. Satyawati Jain* 30,000 30,000

Shri F. H. Tapia 37,500 37,500

Dr. V. H. Joshi 40,000 40,000

Shri Yuvaraj Saheb of Dhrangadhra 45,000 45,000

Shri Sushil K. Jalan 30,000 30,000

Shri Nirmal Kumar Ruia**

Shri R. V. Ruia*** 30,000 30,000* Holds 1,04,000 Equity Shares of Rs. 2 each of the Company.** Ceased to be a Director w.e.f. April 22, 2007.*** Appointed as a Director w.e.f. May 19, 2007.Sitting Fee also includes payment for Board level committee meetings.

• DetailsoftheremunerationpaidtotheDirectorsfortheFinancialyear2007-2008isgivenbelow:




LIMITED

Dr. Shashi Chand Jain, Shri Pramod KumarJain, Shri Bakul Jain and Mrs. Vandana Jainare each entitled for commission @ 25%of the difference between 10% of the netprots as computed under Section 349 of the Companies Act, 1956, in a nancial

year and the aggregate of the salary andperquisites and benets paid to all theManaging Directors and Executive Directorin that year subject to the overall ceilingsstipulated in Sections 198 and 309 of theCompanies Act, 1956.

The appointments of Managing Directors/ Executive Director are contractual and arefor a period of 5 years.

The appointment of the Managing Directors/ Executive Director may be terminated byeither party by giving a six-month notice.

No severance fee is payable on terminationof appointment.

Non-Executive Directors are not paid/ entitled for any remuneration other thansitting fees.

Presently the Company does not have anyScheme for grant of any stock option eitherto the Directors or to the employees.

5. Shareholders’/Investors’GrievanceCommittee:

Smt. Satyawati Jain, Non-executive Director isthe Chairperson of the Shareholders’/Investors’Grievance Committee.

Mrs. Chital V. Shah is the Compliance Ofcer of the Company.

There were 105 complaints received from theshareholders during the year.

All the Complaints were resolved satisfactorily.

There were no pending complaints as on31.03.2008.

6. GeneralBodyMeetings:

(i) Location and time where last 3 AnnualGeneral Meetings held:

Year Location Date Time No. of SpecialResolutionsPassed

2004-05 Dhrangadhra,Gujarat

25.08.2005 11.00 a.m. 1


06.07.2006 10.00 a.m. 1


23.07.2007 10.00 a.m. 2

(ii) No Special Resolution has been passed lastyear through postal ballot.

(iii) No Special Resolution is proposed to beconducted through postal ballot.

7. Disclosures:

1. During the year, there were no transactionsof material nature with the Promoters,Directors or the management or relativesetc. that may have potential conict withthe interest of the Company at large.

2. During the last three years, there were nostrictures or penalties imposed by eitherSEBI or the Stock Exchanges or any otherstatutory authority for non-compliance of any matter related to the Capital Market.

3. DCW Code of Conduct:

The Board has laid down a Code of Conduct for all Board Members andSenior Management of the Company. TheCode of Conduct is posted on the websiteof the Company.

In accordance with the Securities andExchange Board of India (Prohibitionof Insider Trading) Regulations, 1992as amended, the Board of Directors of the Company formulated DCW Code of Conduct for the prevention of InsiderTrading in the shares of the Company by itsDirectors and designated employees. TheDCW Code, inter-alia, prohibits purchase/ sale of shares of the Company by theDirectors and designated employees, whilein possession of unpublished price sensitiveinformation in relation to the Company. A

system has been put in place and Directors/ Designated Employees have been advisedto take pre-clearance before purchase/saleof the Company’s shares.

Whistle Blower mechanism is in existenceand no personnel has been denied accessto the Audit Committee.

4. CompliancewithMandatoryRequirements:

The Company has complied with themandatory requirements of the Code of Corporate Governance as stipulated under

Clause 49 of the Listing Agreement with theStock Exchanges.

Compliance with Non-MandatoryRequirements:

. (1) The Board:

The Company has an ExecutiveChairman and hence therequirement pertaining toreimbursement of expenses to aNon-Executive Chairman does notarise.




LIMITED

(2) Remuneration Committee:

Please refer Item No. 4 under theheading ‘Mandatory Requirements’.

(3) Shareholders’Rights:

As the Company’s Quarterly

results are published in EnglishNewspapers having circulationall over India and in a GujaratiNewspaper circulated in Gujarat,the same are not sent to eachhousehold of shareholders.

(4) Auditqualication:

The Company move towards aregime of unqualied nancialstatements.

(5) TrainingofBoardMembers:

The Board of Directors consists

of professionals with expertise intheir respective elds and industry.They endeavor to keep themselvesupdated with changes in economyand legislation.

(6) Mechanism for evaluating non-executiveBoardMembers:

The performance evaluation of non-executive Directors is done bythe Board of Directors, excludingthe Director being evaluated.

(7) WhistleBlowerPolicy:

The Company has in existence asystem for the employees to reportto the Management about unethicalbehaviour, actual or suspectedfraud or violation of the Company’sCode of Conduct.

DECLARATIONOFCOMPLIANCEWITHTHECODEOFCONDUCT/ETHICS:

All the Directors and Senior Managementpersonnel have afrmed compliance withthe Code of Conduct/Ethics as approvedand adopted by the Board of Directors.

8. MeansofCommunication:

• The Quarterly results are published in‘Financial Express’/Economics Times in alleditions in India including in the Gujaratiedition published from Ahmedabad. Theseare not sent individually to the shareholders.

• The above results are also displayedon the Company’s web-site viz.www.dcwltd.com

• There were no presentations made to theinstitutional investors or to the analysts.

9. General Shareholders information:

ANNUAL GENERAL MEETING:

• Day & Date - : Monday, 30th June,2008

• Time : 10.00 A.M.

• Venue : at the Registered Ofce(at Guest House No. 2)Dhrangadhra,Gujarat - 363 315,

Financialcalendar:April2007–March2008:

Date of Book closure: : 24th June, 2008 to30th June, 2008(both days inclusive)

DividendPaymentDate

: 5th July, 2008

ListingonStockExchanges: The Company’s shares are listed with the followingStock Exchanges: :

• The Mumbai StockExchange (BSE)

: Phiroze JeejeebhoyTowers, Dalal Street,Mumbai 400 023

• National StockExchange of IndiaLimited (NSE)

: Exchange Plaza Bldg.,5th oor, Plot No. C-1,‘G’ Block, Bandra-KurlaComplex,Near Wockhardt,Mumbai 400 051

Annual Listing fees as prescribed has beenpaid to the above Stock Exchanges for theyear 2008-2009.

GDRs of the Company are listed with theLuxembourg Stock Exchange.

StockCode : 500117 (BSE),DCW (NSE)

Demat ISIN Nos. : INE 500A01011(Fully Paid)

Share Transfersand otherCommunications maybeAddressedto

: Bigshare Services Pvt.Ltd., (Unit DCW Ltd.,)E/2, Ansa IndustrialEstate, Sakivihar Road,Saki Naka, Andheri (E),Mumbai - 400 072.

Investors’ complaintsmaybeAddressed to

: Asst. Company SecretaryDCW Limited Nirmal, 3rd oor,Nariman Point,Mumbai - 400 021




LIMITED

Marketpricedata:

High/Low During each month in last Financialyear:

Month/YearNSE BSE

High

(Rs.)

Low

(Rs.)

High

(Rs.)

Low

(Rs.)April, 2007 14.20 10.15 14.15 10.01May, 2007 14.60 9.70 13.34 11.50June, 2007 14.35 10.35 12.50 11.10July, 2007 13.55 11.40 13.50 11.30August, 2007 15.20 11.30 15.88 11.25September, 2007 19.80 14.10 19.49 14.10October, 2007 21.45 13.60 21.40 14.15November, 2007 26.25 14.65 26.15 15.50December, 2007 37.70 22.75 37.60 22.90January, 2008 50.65 24.90 50.20 26.30February, 2008 30.75 23.10 30.60 22.80March, 2008 23.00 14.00 22.85 13.75

StockPerformance(Indexed):

The performance of the Company’s shares relativeto BSE Sensex is given in the chart below:

RegistrarandShareTransferAgents:

The Company has appointed BigshareServices Pvt. Ltd., E/2, Ansa Industrial Estate,

Sakivihar Road, Saki Naka, Andheri (East),Mumbai - 400 072 as Registrars and Share TransferAgents of the Company.

The Company’s shares are traded in the StockExchanges compulsorily under demat mode.All the applications received for transfer of physical shares are approved by the Share TransferCommittee, which normally meets twice in amonth depending on the volume of transfers.Share transfers are registered and returned normallywithin 20 days from the date of lodgement,if documents are complete in all respects.

ShareholdingPatternason31.03.2008:

Category of Shareholder No. of Shares

held

Percent-age of Share-

holding

(A) SHAREHOLDING OF PROMOTER

AND PROMOTER GROUP

(1) INDIAN

(a) Individuals/Hindu UndividedFamily

30,588,164 15.59

(b) Central Government/StateGovernment(s)

(c) Bodies Corporate 48,057,761 24.50

(d) Financial Institutions/Banks

(e) Any Others (Specify)

SubTotal(A)(1) 78,645,925 40.09

(2) FOREIGN

(a) Individuals(Non-Residents Individuals/ Foreign Individuals)

(b) Bodies Corporate

(c) Institutions

(d) Any Others (Specify)

SubTotal(A)(2)

TotalShareholdingofPromoterandPromoterGroup(A)=(A)(1)+(A)(2) 78,645,925 40.09

(B) PUBLIC SHAREHOLDING

(1) Institutions

(a) Mutual Funds/UTI 27,955 0.01

(b) Financial Institutions/Banks 9,201,973 4.69

(c) Central Government/StateGovernment(s)

(d) Venture Capital Funds (e) Insurance Companies

(f) Foreign Institutional Investors 23,937,600 12.20

(g) Foreign Venture CapitalInvestors

(h) Any Other (specify)

(h-i) Foreign Banks 42,225 0.02

Sub-Total(B)(1) 33,209,753 16.93

(2) Non-institutions

(a) Bodies Corporate 14,692,607 7.49

(b) Individuals 58,293,467 29.72

(c) Any Other (specify)

(c-i) Clearing Member 311,188 0.16

(c-ii) NRI 1,947,985 0.99(c-iii) OCBs 5,778,145 2.95(c-iv) Trust 20,850 0.01(c-v) Non Domestic Company 5,920

Sub-Total(B)(2) 81,050,162 41.32

(B) TotalPublicShareholding (B)=(B)(1)+(B)(2) 114,259,915 58.25

TOTAL(A)+(B) 192,905,840 98.34

(C) Shares held by Custodian and againstwhich Depository Receipts havebeen issued 3,248,750 1.66

GRANDTOTAL(A)+(B)+(C) 196,154,590 100.00




LIMITED

Dematerialisation of shares: 18,56,00,925 Equityshares held by 64,192 Shareholders comprising94.62% of the paid up Share Capital have beendematerialised as on 31st March, 2008.

AuditorsCertifcateonClause49Compliance

Outstanding GDRs/ADRs/Warrants/convertibleinstruments etc.:

Outstanding GDRs as on 31st March, 2008 represent32,48,750 shares (1.66%). There are no furtheroutstanding instruments, which are convertible intoequity shares in the future.

PlantLocation:

Given in the 1st page of this Annual Report.

Address for correspondence:

DCW Limited,Nirmal, 3rd oor,Nariman Point, Mumbai - 400 021.

The Board of DirectorsDCW LIMITED

I have reviewed the records concerning the Company’scompliance of conditions of Corporate Governance as stipulatedin Clause 49 of the Listing Agreement entered into, by theCompany, with the Stock Exchanges of India, for the nancialyear ended 31st March, 2008.

The compliance of conditions of corporate governance is theresponsibility of the management. My examination was limitedto procedures and implementation thereof, adopted by theCompany for ensuring the compliance of the conditions of theCorporate Governance. It is neither an audit nor an expressionof opinion on the nancial statements of the Company.

I have conducted our review on the basis of the relevant recordsand documents maintained by the Company and furnished to

me for the review, and the information and explanations givento me by the Company.

Based on such a review, in my opinion, the Company hascomplied with the conditions of Corporate Governance, asstipulated in Clause 49 of the said Listing Agreements.

I further state that, such compliance is neither an assurance as

to the future viability of the Company, nor as to the efciencyor effectiveness with which the management has conducted theaffairs of the Company.

Ms. Kumkum R. ShahPlace : Mumbai Company Secretary

Date : 16th May, 2008. CP No. - 7455




LIMITED

Annexure to the Directors’ Report

STATEMENT CONTAINING PARTICULARS PURSUANT TO THE COMPANIES (DISCLOSURE OF PARTICULARS IN THE REPORTOF BOARD OF DIRECTORS) RULES, 1988 AND FORMING PART OF THE DIRECTORS REPORT.

A. CONSERVATION OF ENERGY:

1. Installation of supermisers

Supermizers, the electronic device to reduce energy consumption in three phase induction motors, are being used continuouslyin all plants to save energy. So far, 201 supermizers have been installed resulting in saving of 37 lacs units during theyear.

2. Installationofenergyefcientlighting

E+tubelightsareenergyefcientwithlongerlifeandhighlumens.Eachtubeconsumes28watts,comparedtoconventionaltubelightswhichconsumes53watts.DCWcontinuestheconversionprogrammeinphasedmannertoreplaceinefcienttubelights.Also,inefcientmercuryandsodiumvaporlampswerereplacedbyhighlyefcientmetalhalidelamps.Annualenergysavingtoatuneof4.5lacsunitsisachieved.

3. Fan less cooling towers

7Nosofcoolingtowershavebeeninserviceandannualenergysavingstoatuneof10lacsunitsisachieved.

4. Cost Improvements Programme

In-housecostimprovementsareconductedperiodicallywheremostlyenergysavingproposalsaregivenbyalldepartmentsforimplementation.Duringtheyearunderreport,2programmeswereconductedand25suggestionsresultinginannualsavings to the tune of Rs. 20 Lacs have been implemented.

B. TECHNOLOGY ABSORPTION:

1. Researches and Development:

1.1. BENEFICIATED ILMENITE

1.1.1. Process optimization to reduce cycle time and conserve energy.

Asatrial,PLCsystemwithaccessorieshasbeenorderedforonedigestertoassesspossiblesavings.Afteroptimizingtheoperations,willbeextendedforalldigesters.

1.1.2 . Capacity enhancement and quality improvement for BI AddingonemorevaccumlterwithaccessoriesaugmentedWashingandltrationsectioncapacity.Improved

washingarrangementsmadeintheltertomeetoverseascustomers’requirements.

1.2 PVC

1.2.1. Trialswereconductedsuccessfullyusing indigenous catalysttospeedupthereactiontime.RegularimplementationwillbecarriedoutafteraugmentingtheincreasedChilledWaterLoad.

1.2.2. Statutoryclearancesarebeingobtainedtoinstallanew5000M3 Horten Sphere to store imported VCM at thePort Premises to improve logistics.

2. Expenditure on Research & Development:

(i) Capital Rs. 43.25 lacs(ii) Recurring Rs. 10.43 lacs

Rs. 53.68 lacs

(iii) TotalResearch&DevelopmentExpenditureasapercentageoftotalturnover(NetofExcise):0.07percentage.

Technology Absorption, Adaptation and Innovation :

Continuoseffortsaremadetowardstechnologyabsorption,adaptationandinnovation.Theemphasisisonimprovingthequalityofthenishedproductandreducingenergyconsumption.

C. FOREIGN EXCHANGE EARNINGS AND OUTGO

ParticularsregardingforeignexchangeearningsandoutgoappearinSchedule6formingpartoftheProtandLossAccount.




LIMITED

REQUISITE DATA IN RESPECT OF ENERGY CONSUMPTION

(A) Power and Fuel Consumption

Particulars

Caustic Soda Unit PVC Unit Soda Ash Unit

CurrentYear

2007-2008

PreviousYear

2006-2007

CurrentYear

2007-2008

PreviousYear

2006-2007

CurrentYear

2007-2008

PreviousYear

2006-20071. ELECTRICITY

(a) Purchased

Unit(LakhKwh) 24.86 – 11.05 3.11 38.44 37.77

Total Amount(Rs. in lakhs)

117.74 – 68.78 22.29 197.33 192.68

Rate/Unit (Rs.) 4.74 – 6.22 7.16 5.13 5.10

(b) OwnGeneration

(i) ThroughDieselGenerator

Unit(LakhKwh) 1,968.52 1,942.80 199.95 153.50 – –

Unit/ltr of LSHS/Diesel Oil 4.50 4.43 1.79 4.43 – –Cost/Unit (Rs.) 4.65 4.63 4.65 4.63 – –

(ii) ThroughSteamTurbineGenerator

Unit(LakhKwh) – – – – 245.19 238.25

Unit/ltr.ofFuelOil/Gas – – – – – –

Cost/Unit (Rs.) – – – – – –

2. Coal(specifyqualityandwhereused)

Quantity (MT) – – – – 1,501 –

Total cost – – – – 71.78 –

Average rate – – – – 4,782 –

3. FURNACE OIL/LSHS/LSFO

Quantity (Kl) 48,185.63 47,280.26 7,651.55 3,640.14 – –

Total Amount(Rs. in Lakhs) 10,280.53 9 ,680.46 923.62 630.34 – –

Average Rate (Rs.) 17,516.37 17,303.34 12,070.97 17,316.45 – –

4. OTHERS

(i) Hydrogen

Quantity (MT) – 89.513 – – – –

Total Amount (Rs. in lakhs) – 42.92 – – – –

Rate/Unit (Rs.) – 47,947.41 – – – –

(ii) Lignite

Quantity (MT) – – – – 1,13,671 1,13,859

Total Amount (Rs. in Lakhs) – – – – 2,026.70 1,746.96

Rate/Unit (Rs.) – – – – 1,783 1,534

(iii) HSD

Quantity (MT) 11.61 11.03 5.74 3.77 – –

Total Amount (Rs. in lakhs) 4.56 4.35 2.25 1.49 – –

Rate/Unit (Rs.) 39,292.03 39,489.90 39,292.03 39,489.90 – –




LIMITED

(B) Consumption per unit of Production

Particulars

Caustic Soda Unit PVC Unit Soda Ash Unit

CurrentYear

2007-2008

PreviousYear

2006-2007

CurrentYear

2007-2008

PreviousYear

2006-2007

CurrentYear

2007-2008

PreviousYear

2006-2007

1. Electricity(Kwh) 1,335,912 3,026 239 229 255 241

2. Fuel Oil (MT) 1.353 0.175 0.749 0.054 – –

3. Coal (MT) – – – – 0.017 –

4. Others

(i) Hydrogen (Kgs.) – 4.12 – – – –

(ii) LSHS (MT) – – – – – –

(iii) Lignite (MT) – – – – 1.042 0.926

(iv) HSD (Litre) 0.0001 0.0001 – – – –

Annexure to the Directors’ Report

InformationasperSection217(2A)oftheCompaniesAct,1956,readwiththeCompanies (ParticularsofEmployees)Rules,1975andformingpartoftheDirector’sReport

Name Designation/ Nature of duties

Remuneration

(Rupees)

Qualication Experience(Years)

Date of commence-ment of Employment

Age

(Years)

Last employment held.Name of the Company,Designation and periodof service

Employed for whole of the year

Dr. Shashi Chand Jain Chairman & ManagingDirector

1,11,12,959 Ph.D (Economics) 52 01.04.1969 75 Sahu Brothers (Saurashtra)Pvt. Ltd. Director – 11 years

Shri Pramod Kumar Jain Managing Director 1,11,12,909 B.A. (Hon.)Economics

49 01.04.1969 70 Sahu Brothers (Saurashtra)Pvt. Ltd.

Shri Bakul Jain Managing Director 1,11,12,743 B.Com., MBA 24 01.09.1984 53

Smt. Vandana Jain ExecutiveDirector 1,04,64,722 B.Com 02 01.08.2006 72

Employed for part of the year

Shri M. Varadarajan Manager (Elec.-PVC) 3,67,614.69 B.Tech (Elec.) 18 21.11.1988 54 GraphiteIndiaLtd.– 2 years

Shri A. Stephen Corera Dy. Plant Manager(PVC)

6,10,498.92 B.Sc. (Maths) 24 01.06.1983 58 Plastic Resins & ChemicalsLtd. – 3 years

Shri R. Jeyasingh Foreman 2,07,068.78 SSLC passed & ITISheet Metal

38 01.07.1979 58 Nil

Shri. C.R. Balachandran Manager 6,22,007.33 B.Com., DPM 26 16.09.1981 57 India Forge Ltd. – 12 yearsShriG.ThilakaRoy GeneralManager

(PowerProject)8,13,741.39 B.E. (Mech.) 15 10.01.1992 51 Neyveli Lignite Corporation

– 11 years

Notes:1. IncaseofManagingDirectorsandExecutiveDirectorthegrossremunerationshownabove(subjecttotax)comprisesalary,Perquisites,Commission,

Company’scontributiontoProvidentFund,SuperannuationFundandGratuityFund.2. Incaseofotheremployees,thegrossremunerationshownabove(subjecttotax)comprisesalary,perquisites,Company’sContribtiontoProvident

Fund and gratuity paid.3. ThenatureofemploymentoftheManagingDirectors&theExecutiveDirectoriscontractual.4. Dr.ShashiChandJain,ShriPramodKumarJain,ShriBakulJain–ManagingDirectorsandSmt.VandanaJain–ExecutiveDirector,arerelatedto

Smt.SatyawatiJain–DirectoroftheCompany.




LIMITEDBalance Sheet

AS AT 31ST MARCH, 2008

As at31/03/2008

US $ in Millions*

As at31/03/2007

US $ in Millions#

SOURCES OF FUNDS

Shareholders Funds: Capital 9.78 7.94Reserves & surplus 67.13 50.54

Loan Funds:Secured Loans 95.35 45.83Unsecured Loans 0.01 3.33

Deferred Tax Liability: Deferred Tax Liability 18.99 15.23Deferred Tax Asset (0.67) (0.71)

18.32 14.52TOTAL 190.59 122.16

APPLICATION OF FUNDS

Fixed Assets:Gross Block 209.43 138.44Less: Depreciation 69.88 65.53

139.55 72.91

Capital Work-in-progress 37.78 41.39177.33 114.30

Investments 3.19 0.11Current Assets, Loans and Advances:

Inventories 31.09 16.19Sundry Debtors 16.15 14.60Cash and Bank balances 2.43 (1.02)Loans and advances 16.29 20.63

65.96 50.40Less: Current liabilities and Provisions

Liabilities 51.97 39.09Provisions 3.92 3.56

55.89 42.65

Net Current Assets 10.07 7.75

TOTAL 190.59 122.16

* 1 US $ = Rs. 40.10

# 1 US $ = Rs. 43.48




LIMITED Proft & Loss Account

FOR THE YEAR ENDED 31ST MARCH, 2008

For the year ended31/03/2008

US $ in Millions*


US $ in Millions#

INCOME

Sales (including Excise Duty) 215.37 173.46

Less : Excise Duty 28.85 21.03

186.52 152.43

Other income 3.14 3.76

189.66 156.19

EXPENDITURE

Manufacturing and other expenses 166.12 141.61

Interest & Finance Charges 3.36 1.54

169.48 143.15

ProtBeforeDepreciation 20.18 13.04Depreciation 7.49 5.82

ProtBeforeTax 12.69 7.22

Provision For Tax

Current tax 1.43 0.80

FringeBenetTax 0.15 0.17

MAT Credit Available for Set off (0.39) (0.10)

Tax Adjustment of Previous Year

ProtafterCurrentTax&TaxAdjustments 11.50 6.35

Deferred Tax 2.58 1.71

ProtAfterDeferredTax 8.92 4.64Add : Surplus brought forward from last year 6.09 6.96

15.01 11.60

APPROPRIATION

Transfer to General Reserve 4.99 4.60

Interim Dividend on Equity Shares 0.79

Final/Proposed Dividend on Equity Shares 1.47 0.40

Tax on Dividend 0.25 0.20

ProtCarriedforward 8.30 5.61

* 1 US $ = Rs. 40.10

# 1 US $ = Rs. 43.48




LIMITEDKey Financial Data

2007-2008 2006-2007

Rs. inMillions

US $ inMillions*

Rs. inMillions

US $ inMillions#

Gross Sales 8,636.50 215.37 7,541.98 173.46

Fixed Assets – Gross Block 8,398.32 209.43 6,019.42 138.44

Net Block 7,111.06 177.33 4,969.66 114.30

Export Earnings 911.17 22.72 716.70 16.48

Earning Before Depreciation and Interest 944.42 23.55 633.94 14.58

Interest 134.83 3.36 67.06 1.54

Earnings Before Depreciation 809.59 20.19 566.88 13.04

Depreciation 300.29 7.49 253.29 5.83

Earnings Before Tax 509.30 12.70 313.59 7.21

Taxation

Current 57.50 1.43 34.72 0.80

FringeBenetTax 6.00 0.15 7.36 0.17

MAT Credit available for set off (15.50) (0.39) (4.49) (0.10)

Tax adjustment of previous year – – – –

Deferred Tax 103.37 2.58 74.31 1.71

Earnings After Tax 357.93 8.93 201.69 4.64

No. of shares of Rs. 2/- each(Million Nos.) @ 196.15 196.15 172.54 172.54

Earnings per Shares ( Rs. / US $ ) 1.82 0.05 1.17 0.03

Net Worth (Excl. Revaluation Reserve) 2,990.84 74.58 2,418.44 55.62

Book value per share 15.25 0.38 14.02 0.32

Grossprottosales(%)(Earnings Before Depreciation)

9.37 9.37 7.52 7.52

Interest coverage Ratio 7.00 7.00 9.45 9.45

Debt/Equity 1.24:1 1.24:1 0.84:1 0.84:1

Current Assets/Current Liabilities 1.18 1.18 1.18 1.18

* 1 US $ = Rs. 40.10

# 1 US $ = Rs. 43.48






LIMITED

ANNEXURE REFERRED TO INPARAGRAPH 3 OF AUDITOR’S REPORTTO THE SHAREHOLDERS OF DCWLIMITED ON THE ACCOUNTS FOR THEYEAR ENDED 31ST MARCH 2008.

i. (a) The Company has maintainedproper records showing parti-culars including quantitativedetails and situation of xedassets.

(b) We are informed that the xedassets have been physicallyveried by the Managementwith the assistance of externalagencies during the year. Inour opinion the frequency of verication is reasonable. As

per the information given to usby the management, no materialdiscrepancies as compared tobook records were noticed inrespect of xed assets veriedduring the year

(c) Since there is no disposal of a substantial part of xedassets during the year, thepreparation of nancialstatements on a going concernbasis is not affected on thisaccount.

ii. (a) The inventories of nishedgoods (except goods lyingwith consignees and intransit), stores, spare parts andraw materials (except salt atSahupuram and stock in transit)have been physically veriedby the management with thehelp of external agencies. Inour opinion, the frequency

of physical verication isreasonable

(b) In our opinion, the proceduresof physical verication of inventories (except nishedgoods lying with consigneesand in transit) followed by themanagement are reasonableand adequate in relation to thesize of the company and thenature of its business.

(c) In our opinion, the companyis maintaining proper recordsof inventories and no materialdiscrepancies were noticedon physical verication ascompared to the record of

inventories.

iii. Based on the audit proceduresapplied by us and according to theinformation and explanations givento us, the Company has not grantedor taken any loans, secured orunsecured, to/from companies, rmsor other parties listed in the registermaintained under Section 301 of theCompanies Act, 1956.

iv. In our opinion and according to theinformation and explanations given tous, having regard to the explanationthat for purchase of certain rawmaterials, stores, components, andxed assets, alternative sources of supply are limited with referenceto quality, delivery schedules,credit period and some of the itemspurchased are of special nature,and hence comparable alternativequotations are not available for these,there are adequate internal control

procedures commensurate with thesize of the Company and the natureof its business for the purchase of inventories and xed assets andfor the sale of goods and services.During the course of our audit, wehave not observed any continuingfailure to correct major weaknessesin the internal control system.

v. (a) Based on the audit proceduresapplied by us, to the best of our knowledge and belief and

according to the informationand explanations given tous, particulars of contracts orarrangements referred to inSection 301 of the CompaniesAct, 1956, have been enteredin the register required to bemaintained under that Section.

(b) Sub-clause (b) of sub-para (v)of para 4 of the Order is notapplicable as there are no

such transactions exceedingthe value of Rupees Five Lacsin respect of any party in thenancial year.

vi. In our opinion and according to the

information and explanations given tous, the Company has complied withthe provisions of the Sections 58A,58AA and other relevant provisionsof the Companies Act, 1956 andthe rules framed thereunder, withregard to deposits accepted from thepublic.

We are informed by the Managementthat no order has been passed by theCompany Law Board or NationalCompany Law Tribunal or ReserveBank of India or any Court or anyother Tribunal under Sections 58Aand 58AA of the Companies Act,1956.

vii. The Company has, in general, aninternal audit system commensuratewith the size and nature of theCompany’s business.

viii. We have broadly reviewed thebooks of account maintained by the

Company pursuant to the rules madeby the Central Government for themaintenance of cost records underSection 209(1)(d) of the CompaniesAct, 1956 and are of the opinion that,prima facie, the prescribed accountsand records have been made andmaintained. We have not, however,made a detailed examinationof these records with a view todetermine whether they are accurateor complete.

ix. (a) According to the records of theCompany, undisputed statutorydues including providentfund, investor education andprotection fund, employees’state insurance, income tax,sales tax / VAT, wealth tax,service tax, custom duty, exciseduty, cess and other materialstatutory dues that are requiredto be deposited regularlywith authorities, have generally




LIMITED

(Rs. in lacs)

Name of the Statute/ Nature of Dues

Period Forum where Dispute is pending

Supreme

Court

High

Court

Appellate

Tribunal*

Appellate

Authority**

State

Govern-ment

Grand

Total

Customs Act, 1962 (Customs DutyIncluding Penalty & Interest,wherever applicable)

1997 to 2007 127.05 127.05

Central Excise Act, 1944 (ExciseDuty Including Penalty & Interest,wherever applicable)

1997 to 2007 49.57 154.04 100.06 303.67

Sales Tax Legislations(Sales Tax, including Penalty &Interest, wherever applicable)

1982 to 2007 246.20 530.67 147.88 924.75

Local cess, Local cess surcharge(Land Revenue IncludingPenalty and Interest,wherever applicable)

1989 to 2007 0.69 12.69 13.38

Grand Total 296.46 811.76 247.94 12.69 1,368.85

* Appellate Tribunal includes STAT, CESTAT and ITAT

** Appellate Authority includes Commissioner Appeals, Assistant Commissioner Appeals, Deputy Commissioner Appeals, Joint Commissioner Appeals and Deputy Commissioner Commercial Taxes Appeals.

been regularly deposited withthe appropriate authorities.According to the informationand explanations given to us,no undisputed amounts inrespect of the aforesaid statutory

dues were in arrears, as at31st March, 2008, for a periodof more than six monthsfrom the date they becamepayable.

(b) According to the informationand explanations given to usand the records of the Company,the dues of sales tax/incometax/customs duty/wealth tax/ service tax/excise duty/cess,which have not been deposited

on account of any dispute areas follows:

x. The Company does not have anyaccumulated losses at the end of thenancial year. The Company hasnot incurred any cash losses duringthe nancial year covered by ouraudit and the immediately preceding

nancial year.

xi. On the basis of verication of records and according to theinformation and explanations givento us, the Company has not defaultedin repayment of dues to FinancialInstitutions/Banks or Debentureholders.

xii. The Company has not granted anyloans and advances on the basisof security by way of pledge of

shares, debentures and othersecurities.

xiii. The Company is not a chit fund ora nidhi or a mutual benet society.Therefore the provisions of sub- para(xiii) of para 4 of the Order are notapplicable to the Company.

xiv. In respect of shares, securities andother investments dealt in or tradedby the Company, proper recordshave been maintained of thetransactions and contracts and timelyentries have been made therein.All the investments are held by theCompany in its own name except tothe extent of the exemption grantedunder section 49 of the CompaniesAct, 1956.

xv. According to the information and

explanations given to us, the Companyhas not given any guarantee for any




LIMITED

loans taken by others from any bankor nancial institution.

xvi. In our opinion, the term loans takenduring the year have, prima facie,

been applied for the purpose forwhich they were raised.

xvii. According to the information andexplanations given to us, basedon an overall examination of thebalance sheet of the Company,related information made availableto us and as represented to us bythe Management, funds raised on

short-term basis have, prima facie,not been used during the year forlong-term investment.

xviii. The Company has made preferentialallotment of shares during the year to

a company in the register maintainedunder section 301 of the CompaniesAct, 1956. In our opinion, the priceat which shares have been issued isnot prejudicial to the interest of theCompany.

xix. The Company has not issued anydebentures during the year andtherefore the question of creating

security or charge in respect thereof does not arise.

xx. The Company has not madeany public issue of any securitiesduring the year and therefore the

question of disclosing the end-useof money raised by any public issuedoes not arise.

xxi. We are informed that during theyear, no instances of materialfraud on or by the Company havebeen noted or reported by themanagement.

For V. Sankar Aiyar & Co.,Chartered Accountants.

S. VenkatramanPlace : Mumbai Partner Dated : 16th May, 2008. Membership No. 34319




LIMITED Balance Sheet


Schedule As at31/03/2008

Rs. in lacs

As at31/03/2007

Rs. in lacs

SOURCES OF FUNDS

Shareholders’ Funds :Capital A 3,923.09 3,450.89Reserves and Surplus B 26,917.88 21,973.99

Loan Funds :Secured Loans C 38,233.96 19,926.33Unsecured Loans D 4.92 1,448.52

Deferred tax liability(Refer Note B - 5 of Schedule - N)

Deferred tax liability 7,612.03 6,620.53Less : Deferred tax asset (267.13) (309.36)

7,344.90 6,311.17

45,583.78 27,686.02

TOTAL 76,424.75 53,110.90

APPLICATION OF FUNDSFixed Assets :Gross Block E 83,983.17 60,194.16Less : Depreciation 28,020.94 28,491.76

55,962.23 31,702.40Capital Work-in-progress 15,100.04 17,387.60Machinery/spares for erection and replacement 48.29 606.63

71,110.56 49,696.63

Investments F 1,278.27 46.64Current Assets, Loans and Advances

Inventories G 12,466.74 7,037.28Sundry Debtors H 6,475.13 6,348.15Cash and Bank Balances I 973.46 (443.63)Loans and Advances J 6,532.89 8,969.32

26,448.22 21,911.12

Less: Current Liabilities and ProvisionsLiabilities K 20,838.68 16,997.26Provision L 1,573.62 1,546.23

22,412.30 18,543.49

Net Current Assets 4,035.92 3,367.63Contingent Liabilities not provided for MSignicant Accounting Policies and NNotes forming part of Balance Sheet and Prot and Loss Account

TOTAL 76,424.75 53,110.90

As per our Report attached For and on behalf of the Board

For V. Sankar Aiyar & Co. Dr. Shashi Chand JainChartered Accountants Chairman & Managing Director

S. Venkatraman Vandana JainPramod Kumar JainBakul Jain

Partner Executive Director Managing Directors

Place : Mumbai Chital V. Shah T. M. BhandariDate : 16th May, 2008 Asstt. Company Secretary Sr. Vice President (Finance)

Dr. V. H. Joshi

Yuvaraj Saheb of Dhrangadhra

Sushil Kumar Jalan

R. V. Ruia

Satyawati JainDirectors




LIMITEDProft and Loss Account

FOR THE YEAR ENDED 31ST MARCH, 2008

Schedule For the year ended31/03/2008

Rs. in lacs


Rs. in lacs

INCOME

Sales ‘1’ 86,364.96 75,419.82Less : Excise Duty (11,568.62) (9,146.03)

Net Sales 74,796.34 66,273.79

Other Income ‘2’ 1,260.75 1,635.57

76,057.09 67,909.36

EXPENDITURE

Manufacturing and Other expenses ‘3’ 66,612.91 61,570.00

Interest & Finance Charges (Net) ‘4’ 1,348.34 670.58

67,961.25 62,240.58

Depreciation ‘5’ 3,002.85 2,532.88

70,964.10 64,773.46

Prot before tax 5,092.99 3,135.90Current Tax 575.00 347.24

Fringe Benet Tax 60.00 73.58

MAT Credit Available for set off (155.00) (44.90)

Prot after Current Tax & Tax Adjustments 4,612.99 2,759.98

Deferred Tax (Refer Note B - 5 of Schedule N) 1,033.73 743.07

Prot after Deferred tax 3,579.26 2,016.91

Add : Surplus brought forward from last year 2,440.53 3,027.73

Available for appropriation 6,019.79 5,044.64

APPROPRIATION

Transfer to General Reserve 2,000.00 2,000.00

Interim Dividend on Equity Shares 345.09Proposed Dividend/Final on Equity Shares 588.46 172.54

Tax on Proposed/Final Dividend 100.01 86.45

2,688.47 2,604.08

Prot Carried forward 3,331.32 2,440.56

Notes to Prot & Loss Account ‘6’

Earning per share (Face Value Rs. 2)

Basic 1.82 1.17

Diluted 1.90 1.17






Dr. V. H. Joshi


Sushil Kumar Jalan

R. V. Ruia





LIMITED

CASH FLOW STATEMENT FOR THE YEAR ENDED 31st MARCH, 2008

2007-08Rs. in Lacs

2006-07Rs. in Lacs

A. CashowfromoperatingActivitiesNet prot before tax and extraordinary items 5092.99 3135.88

Adjustments for :Non-cash items 49.83 (823.72)Depreciation 3002.85 2532.88Interest (net) 1348.34 541.72Dividend income (36.83) 4364.19 (98.36) 2152.52

Operating prot before working capital changes 9457.18 5288.40Adjustments for :Trade and other receivables 2464.45 (4592.68)Inventories (5429.46) 5046.20Current liabilities and provisions 3738.42 773.41 1534.95 1988.47

Cash generation from operations 10230.59 7276.87Direct taxes paid (731.93) (146.17)

Cash ow before Extraordinary items 7130.70Extraordinary items

NetcashowfromoperatingActivities 9498.66 7130.70

B. CashowfromInvestingActivitiesPurchase of xed Assets (25345.90) (19307.09)Sale of Fixed Assets 570.59 3007.69Purchase / Sales of Investments (1231.63) 1063.20Dividend Income 36.83 98.36Interest income 108.67 163.78

Net cash used in investing Activities (25861.44) (14974.06)

C. CashfromnancingactivitiesProceeds from issue of share capital 2834.00 Repayment of loans (3402.86) (2682.86)

Repayment of Other borrowings (57.83) (97.73)Proceeds from Long Term Borrowings 20469.20 12900.23Proceeds from Short Term Borrowings (144.48) Interest paid (1312.56) (1256.35)Dividend paid (517.63) (517.63)Tax on dividend (87.97) (71.08)

NetcashusedinnancingActivities 17779.87 8274.58

Net increase in Cash and Cash equivalents 1417.09 431.22

Cash&CashEquivalentsasat1stApril2007 (443.63) 957.73Cash & Cash Equivalents as at 31st March 2008 973.46 1388.95

1417.09 431.22






Dr. V. H. Joshi


Sushil Kumar Jalan

R. V. Ruia


Previous year gures have been regrouped to match with current year gures




LIMITEDSchedules

FORMING PART OF THE BALANCE SHEET

As at31/03/2008

Rs. in lacs

As at31/03/2007

Rs. in lacs

SCHEDULE “A”

SHARECAPITAL

Authorised Capital

32,50,00,000 Equity Shares of Rs. 2/- each

(Previous Year 32,50,00,000 Equity Shares of Rs. 2/-each) 6,500 6,500

TOTAL 6,500 6,500

ISSUED, SUBSCRIBED AND PAID-UP CAPITAL

19,61,54,590 Equity Shares of Rs 2/- each

(Previous Year 17,25,44,590 shares of Rs. 2/-each) 3,923.09 3,450.89TOTAL 3,923.09 3,450.89

Notes :

Of the Equity Shares

(1) The following Shares were allotted as fully paid-up without payment being received in cash:-

(a) 5,25,000 Shares to Vendors

(b) 4,550 Shares to Equity Shareholders of the erstwhile, PRC Limited, pursuant to the amalgamation with the Company.

(2) 3,74,50,985 Shares were allotted as fully paid up Bonus Shares by Capitalisation of Capital Redemption Reserve, Share PremiumAccount and General Reserve.

(3) 2,66,66,550 Shares were issued and allotted consequent to conversion of Part A of the 26,66,655 partly convertible debenturesallotted in April, 1992.

(4) 4,61,25,000 Shares were issued in 1994-95 against which Global Depository Receipts were issued by the Depository viz.Citi Bank, USA.

(5) 2,80,94,525 shares were issued and allotted pursuant to Rights issue made during 2000-01.

(6) During the year company has issued and allotted 40,00,000 Nos., of shares on preferential basis to Promoters and 1,96,10,000Nos., of equity shares on preferential basis to FII’s.




LIMITED Schedules


As at31/03/2008

Rs. in lacs

As at31/03/2007

Rs. in lacs

SCHEDULE “B”

RESERVES AND SURPLUS

CAPITAL RESERVE

As per last balance sheet 355.83 355.83

Add : Transfer from Contribution for Capital Expenditure 51.05 51.05

406.88 406.88

CAPITAL REDEMPTION RESERVE

As per last Balance sheet 5.30 5.30

SHARE PREMIUM

As per last balance sheet – 7,079.70 9,440.70 7,079.70

Add: Received during the year – 2,361.00

REVALUATION RESERVE

As per last balance sheet 1,240.50 1,321.89

Less : Transferred to Prot and Loss Account 307.86 81.38

932.64 1,240.51

GENERAL RESERVE

As per last balance sheet 10,801.04 8,801.04

Add : Transfer from P&L account 2,000.00 2,000.00

12,801.04 10,801.04

CONTRIBUTION FOR CAPITAL EXPENDITUREAs per last balance sheet 51.05

Less : Transfer to Capital Reserve 51.05

PROFIT AND LOSS ACCOUNT 3,331.32 2,440.56

TOTAL 26,917.88 21,973.99




LIMITEDSchedules


As at31/03/2008

Rs. in lacs

As at31/03/2007

Rs. in lacs

SCHEDULE “C”

SECURED LOANS

Banks

Rupee Term loans 22,200.52

Foreign Currency Term loans 8,019.98

30,220.50 17,426.90

Working Capital Loans 337.03 (961.36)

Other Loans

Financial Institutions 6,426.43 1,714.29

Term Loans from NBFC 1,250.00 1,746.50

TOTAL 38,233.96 19,926.33

Notes :

LOANS Secured by

Banks Working Capital facilities are secured by a rst charge by way of hypothecation and/or pledge of current assets, namely,stocks of materials, semi-nished and nished goods, consumable stores and spares including machinery spares notcapitalized, bills receivable and book debts and further secured by a second charge by way of hypothcation over allof movable plant and machinery and by way of mortgage by deposit of title deeds over the immovable properties,both present and future, such mortgage to rank second to the mortgages created/to be created in favour of TermLoan Lenders viz., Banks / Financial Institutions.

Term Loans and External Commercial Borrowings from Banks are secured by a pari-passu rst charge by way of hypothecation of movable xed assets of the Company, including movable machinery spares, stores and furthersecured by mortgage on all the immovable properties of the Company situated in the states of Tamilnadu and Gujaraton rst pari passu charge basis.

Other loans Equipments Finance Loan from a Financial Institution and term loan from NBFC are secured by creation of rst pari-passu charge on all the movable xed assets, both present and future by way of hypothecation and further securedby mortgage on all the immovable properties situated in the states of Tamilnadu and Gujarat on rst pari-passucharge basis.

As at31/03/2008

Rs. in lacs

As at31/03/2007

Rs. in lacs

SCHEDULE “D”

UNSECURED LOANS

Short Term Loans – Banks 1,442.87

OTHERS

Deferred Sales Tax Credit 4.92 5.65

TOTAL 4.92 1,448.52

Due within one year Rs. 1.79 lacs (Previous Year Rs. 1,443.60 lacs)




LIMITED

Schedules


SCHEDULE “E” (consolidated)

FIXED ASSETS

Rs. in Lacs

GR

OSS BLOCK

D

EPRECIATION

NET

BLOCK

Description of

Assets

At cost or

Revalued

Book Value

as at

01-04-2007

Additions

and other

transfers

Sales and

other

deduc-

tions

At cost or

Revalued

Book Value

as at

31-03-2008

Depre

ciation

For The

Year

Depreciation

As at

31-03-2008

As at

31-03-200

8

As at

31-03-2007

Land

456.19

1.65

457.83

457.8

3

456.19

Buildings

5,206.03

1,210.92

8.20

6,408.73

132.15

1,953.31

4,455.4

2

3,367.87

Plant and Machinery

52,842.29

26,791.21

4,337.54

75,295.96

2,

766.83

25,093.76

50,202.2

0

27,063.86

Furniture & Fittings

636.41

70.41

0.92

705.88

37.58

529.26

176.6

3

143.71

Railway Sidings

Vehicles

1,053.25

117.62

56.13

1,114.75

89.99

444.61

670.1

4

670.76

TOTAL

60,194.17

28,191.80

4,402.81

83,983.16

3,

026.55

28,020.94

55,962.2

2

31,702.40

Previous Year

59,978.53

5,082.09

4,866.46

60,194.16

2,

565.49

28,491.76

31,702.4

0

31,466.09

Notes:

1.

See Note “B-2” of Schedule “N”.

2.

Buildings include Rs. 523.06

lacs being cost of ownership ats an

d ofce accommodation in Co-operat

ive Societies and a Limited Company against which the

Company holds shares of the

face value of Rs. 0.77 lacs in Co-operative Societies and the Limited Company.

3.

Land includes the leasehold land valued at Rs. 70.99 lacs.

4.

Assignment deeds in respect of 9.13 acres of Land at Caustic Soda Division, transferred by Central Gove

rnment to the State Government, are yet to be executed

by the State Government in favour of the Company.

5.

Land, Building and Plant and

Machinery located at Sahupuram Wo

rks (other than PVC Division) were revalued on 31.03.1993.

6.

The Company exercised the option to purchase 793.39 acres of land leased by the State Government at Sa

hupuram works. Assignment deeds in respect of the said

land are yet to be executed b

y the State Government in favour of the Company.




LIMITEDSchedules


SCHEDULE “F” As at 31/03/2008 As at 31/03/2007

INVESTMENTS (At Cost)

FaceValueper

Share/

UnitBond Rs.

No. of Shares/Bonds

AmountRs. inLacs

FaceValue

per Share/

Unit/ Bond Rs.

No. of Shares/ Bonds

AmountRs. inLacs

I. LONGTERM:

InSubsidiaryCompany-Non-Trade(Unquoted)

M/s. DCW Pigment Ltd. 10 4,950 4.95

InGovt&TrustSecuritiesUnquoted

7 years National Savings Certicates 1,000 10 0.10 1,000 10 0.10

InotherCompanies-Non-Trade(Unquoted)

The Dhrangadhra Peoples Co-op. Bank Ltd. 25 10 *250 25 10 *250

InGovt&TrustSecurities(Quoted)

Unit Trust of India - 6.75 % Tax Free Bonds 100 19,358 19.36 100 19,358 19.36

Less : Diminution value of Bonds 19,358 19,358 0.1019.36 19.26

InotherCompanies-Non-Trade(Quoted)

Fully paid Equity Shares

Global Trust Bank Ltd. 10 19,000 1.90 10 19,000 1.90

LIC Housing Finance Ltd. 10 17,400 10.44 10 17,400 10.44

12.34 12.34

Less : Diminutions value of shares of GlobalTrust Bank 19,000 1.90 19,000 1.90

10.44 10.44

II. CURRENTINVESTMENTS:Fully paid Equity Shares

Tata Consultancy Services Ltd. 1 6 0.03 1 6 0.03

Reliance Petroleum Ltd. 10 28,040 16.82 10 28,040 16.82

16.85 16.85

MUTUAL FUNDS

Principal Mutual Fund - Floating Rate FundFMP 10 1,22,29,943.473 1,226.57

1,226.57

TOTAL 1,278.27 46.65

* Figures Denote Amount in Rupees

31/03/2008Rs. in Lacs

31/03/2007Rs. in Lacs

Aggregate Value of long term quoted investments 48.66 23.96

Aggregate Value of current quoted investments 43.86 20.12

TOTAL 92.52 44.08

Aggregate Value of unquoted investments 5.05 0.10

Market Value of quoted investments 112.16 63.33




LIMITED


Face ValueRupees

No. of Units/Shares

SCHEDULE “F” (Contd.)

InvestmentsPurchasedandRedeemed/Soldduringtheyear:

I. MUTUAL FUND UNITS:SBI Mutual Fund - Magnum Insta Cash Fund – DDR 10 16,895,219.78SBI Mutual Fund - Premier Liquid Fund - Instl. Plan – DDR 10 20,267,965.11Principal Mutual Fund - Cash Mgmt. Fund Liquid - Instl. Premium - DDR 10 385,846,096.89Principal Mutual Fund - Cash Management Fund – Floating Rate Fund FMP 10 12,224,963.29Principal Mutual Fund - Cash Management Fund – Institutional Plan - DDR 10 680,784.87

As at31/03/2008

Rs. in lacs

As at31/03/2007

Rs. in lacs

SCHEDULE “G”

INVENTORIES

(As Certied by the Management)(Refer Note A-6 of Schedule ‘N’)

Stores, Spare Parts, Fuel 5,389.72 1,944.21

Packing Materials (at or below cost) 48.95 24.76

Mercury on hand & in process 228.65

STOCK-IN-TRADE

Raw materials on hand & in transit 2,485.58 2,896.36

Finished Goods 4,135.93 1,787.03

Stock in process 87.79 58.09

Packing Drums & Scrap 269.90 35.77

Coke dust, Gypsum 40.29 54.16

Shares (Refer Statement below) 8.58 8.25

TOTAL 12,466.74 7,037.28

Investmentsinshares(Stockintrade) As at 31/03/2008 As at 31/03/2007

Particulars

FaceValueper Share Rs.

No of Shares

AmountRs. in

lacs

No of Shares

AmountRs. in

lacs

QuotedReliance Industries Ltd 10 561 0.44 553 0.42Reliance Communication Ltd. 5 553 553 Reliance Energy Ltd. 10 41 41 Reliance Natural Resources Ltd. 5 553 553 Reliance Capital Ltd. 10 27 27 Grasim Industries Ltd. 10 700 2.01 700 2.01Ranbaxy Laboratories Ltd. 5 5,426 5.60 5,426 5.60Reliance Industrial Infrastructure Ltd. 10 1,900 0.19 1,900 0.19Indian Telephone Industries Ltd. 10 3,400 0.34 3,400 IPCL 10 43 0.03

TOTAL 8.58 8.25

Schedules






LIMITED


As at31/03/2008

Rs. in lacs

As at31/03/2007

Rs. in lacs

SCHEDULE “K”LIABILITIES

Acceptances against Letters of Credit 13,863.49 7,632.58

Sundry Creditors (Includes Liabilities for capital *items Rs. 996.24 Lacs)

3,806.58 6,818.99

Advances from customers and consignees 1,418.06 1,445.77

Trade and Other Deposits 425.63 344.04

Unclaimed Dividend # 27.15 18.91

Unclaimed Interest Public Deposit Monies # 0.04 0.43

Other Liabilities 1,030.39 613.65

Interest accrued but not due on Loans 267.34 122.89TOTAL 20,838.68 16,997.26

* Includes outstanding dues of micro, small & medium enterprisesRs. 9.22 lacs (Previous year Rs. 18.57 lacs)

# These gures do not include any amounts, due and outstanding,to be credited to Investor Education and Protection Fund.

SCHEDULE “L”

PROVISIONS

Proposed/Final Dividend – Equity 588.46 517.63

Tax on proposed/Final Dividend 100.01 87.97

Provision for Tax (net off Advance Tax and Tax Deducted at Source) 233.09 348.02

Provision for fringe benet tax 27.00 9.00

Provision for Retirement & Other Emp. Benets 625.06 583.61

TOTAL 1,573.62 1,546.23

SCHEDULE “M”

A. CONTINGENTLIABILITIESNOTPROVIDEDFOR:

1. Disputed Sales Tax Demands 982.37 987.94

2. Disputed Excise Demands 304.97 331.55

3. Disputed Customs Demands 197.20 95.794. Company’s contribution to ESI not made pursuant to petitions for

exemption pending before High Court 85.87 82.40

5. Lease Rent, Local Cess, Interest on Lime Stone, Surcharge,Stamp Duty, Octroi & Water and Electricity charges 1,826.41 1,609.13

6. Disputed Industrial relations matters 293.12 251.68

TOTAL 3,689.94 3,358.49

B. GUARANTEEASAMEMBEROFTHEALKALIMFRS.ASSN.

(A Company Limited by Guarantee) Rs. 500 Rs. 500

Schedules




Schedules


LIMITED

SCHEDULE - “N”

SIGNIFICANT ACCOUNTING POLICIES AND NOTES FORMING PART OF THE BALANCE SHEET AND PROFIT AND LOSS ACCOUNTFOR THE YEAR ENDED 31ST MARCH 2008.

A. SIGNIFICANT ACCOUNTING POLICIES

1. SYSTEM OF ACCOUNTING

(A) The Company follows the mercantile system of accounting and recognises income and expenditure on accrual basis.

(B) Financial statements are prepared on historical cost basis and as a going concern, adjusted for revaluation/dimunitionin value of certain xed assets.

2. USE OF ESTIMATES

The preparation of nancial statements requires management to make certain estimates and assumptions that affect the amountsreported in the nancial statements and notes thereto. Differences between actual results and estimates are recognized inthe period in which they materialize.

3. FIXED ASSETS AND DEPRECIATION

(A) Fixed Assets

Fixed Assets are stated at their original cost net of Cenvat Credit where applicable (including expenses related toacquisition and installation) except certain Fixed Assets which are adjusted for revaluation.

(B) Depreciation and Amortisation

Depreciation is charged in the Accounts on straight line method as under:

(a) On assets revalued at Sahupuram Unit on 31-3-93 @ 3 % on the revalued cost based on revision in useful lifeestimated by the valuer (Refer Note B2).

(b) On xed assets added pursuant to the amalgamation of Pantape Magnetics Limited with the Company, at rates

specied in Schedule XIV to the Companies Act, 1956 on the revalued cost.

(c) On balance xed assets of the company at rates specied in Schedule XIV to the Companies Act, 1956 on theoriginal cost.

(d) On xed assets added/disposed off during the year, on pro-rata basis with reference to the month of addition/ disposal.

(e) On Technical Know-how fees at 33.33%

4. REVENUE RECOGNITION

Revenue is recognized to the extent that it can be reliably measured and is probable that the economic benet will followto the company.

(a) Sales : Revenue from sale of goods is recognized when signicant risks and rewards of ownership of the goods aretransferred to the customer and is stated net of trade discounts, excise duty, sales returns and sales tax.

(b) Interest : Revenue is recognized on time proportion basis taking into account the outstanding amount and the applicablerate of interest

(c) Dividends : Revenue is recognized when the right to receive payment is established.

5. EXPENDITURE DURING CONSTRUCTION AND ON NEW PROJECTS

In the case of new projects and in the case of modernisation/expansion of existing units, interest on borrowings for the sameand all pre-operative expenditure, incurred during implementation upto the date of installation are included under CapitalWork in Progress and capitalised by adding pro-rata to the cost of the assets.




Schedules


LIMITED

6. INVESTMENTS

The Company’s investments comprise long term and current investments. Long Term investments are stated at cost lesspermanent dimunition, if any, in value. Current investments are stated at lower of cost or market value.

7. INVENTORIES

Inventories are valued at lower of cost and net realisable value except stores, spares and stock in process which are valuedat cost, packing materials which are valued at or below cost and scrap and by products which are valued at net realisablevalue. Cost is computed on weighted average basis and includes cost of conversion and other costs incurred in bringing theinventories to their present location and condition.

8. ACCOUNTING FOR CENVAT AND SERVICE TAX CREDITS

Cenvat credit available on Raw Materials, Fuel and Packing materials, stores, spares and Capital goods and Service tax crediton services availed are accounted for by reducing purchase cost of the related material or the expenses respectively andCenvat Credit available on xed assets is accounted by reducing the same from the cost of respective xed assets.

9. FOREIGN CURRENCY TRANSACTIONS

(a) Transactions in Foreign Currency are recorded at the exchange rates prevailing on the date of Transactions.

(b) Monetary items denominated in foreign currencies (such as cash receivables , payables, etc.) outstanding at the yearend, are translated at exchange rate applicable as of that date.

(c) Non-monetary items denominated in foreign currency (such as investments, xed assets, etc) are valued at the exchangerate prevailing on the date of transaction.

(d) Any gains or losses arising due to exchange differences at the time of translation or settlement are accounted in theProt & Loss Account.

(e) Premium/discounts on forward exchange contracts are amortised over the life of the contract and recognised in theProt and Loss account, exchange differences on such contracts are recognized in the prot and loss account in thereporting period in which the exchange rates change.

10. RESEARCH & DEVELOPMENT EXPENDITURE

Revenue Expenditure on Research & Development is charged against the Prot of the year in which it is incurred. Capitalexpenditure on Research & Development is shown as an addition to xed assets.

11. BORROWING COSTS

Borrowing costs attributable to acquisition, construction or production of a qualifying asset are capitalized as part of thecost of that asset. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. Allother borrowing costs are recognized as an expense in the period in which they are incurred.

12. EMPLOYEE BENEFITS(a) Contributions to Provident and Superannuation Funds are made to recognised funds and are charged to Prot & Loss

Account. The interest rate payable by recognized Provident Fund shall not be lower than the statutory rate of interestdeclared by Central Government and shortfall, if any, shall be made good by the company.

(b) The company has created an Employees’ Group Gratuity Fund which has taken a Group Gratuity Assurance Schemewith the Life Insurance Corporation of India. Premium charged by the Life Insurance Corporation of India, based onactuarial valuation is debited to the Prot and Loss account.

(c) Liabilities towards Leave Encashment Benet is provided for based on actuarial valuation done at the year end.

(d) Contribution to Employee Pension Scheme 1995 are accounted on accrual basis with corresponding remittance madeto Government Provident Fund authority.




Schedules


LIMITED

13. PROVISIONS & CONTINGENCIES

A. A provision arising out of a present obligation is recognized when it is probable that an outow of resources will berequired to settle the obligation and the amount can be reasonably estimated.

B. Wherever there is a possible obligation that may, but probably will not require an outow of resources, the same isdisclosed by way of contingent liability.

C. Show Cause Notices are not considered as Contingent Liabilities unless converted into demand.

14. TAXES ON INCOME

Income tax expenses comprises current tax and deferred tax charge or credit. Deferred tax assets/liabilities are measured byapplying tax rate and tax laws that have been enacted or substantially enacted by the Balance Sheet date. Deferred tax assetarising on account of unabsorbed depreciation under tax laws is recognised only to the extent there is virtual certainty of its realisation supported by convincing evidence. Deferred tax assets on account of other timing differences are recognisedonly to the extent there is reasonable certainty of its realisation. At each Balance Sheet date, the carrying amount of DeferredTax Asset is reviewed based on developments to reassess realisation.

15. IMPAIRMENT OF ASSET

The carrying amount of assets are reviewed at each balance sheet date for indication of any impairment based on internal/ external factors. An impairment loss is recognized wherever the carrying amount of the assets exceeds its recoverable amount.Any such impairment loss is recognized by charging it to the prot and loss account. A previously recognized impairmentloss is reversed where it no longer exists and the asset is restated to that effect.

B. NOTES ON ACCOUNTS

1. Estimated amount of Contracts remaining to be executed on Capital Account and not provided for is Rs. 1412.38 lacs(previous year Rs. 17662.68 lacs).

2. The depreciation charge on the assets revalued on 31-3-1993 is more by Rs. 23.70 lacs (previous year Rs. 32.61 lacs ) than

the depreciation charge thereon under section 205(2)(b) of the Companies Act, 1956 and the same is met by drawing fromRevaluation Reserve. The uplift on revalued assets discarded amounting to Rs. 284.15 lacs (previous year Rs. 48.77 lacs)has also been met by drawing from Revaluation Reserve.

3. Consignment sales and expenses are incorporated on the basis of sale notes when received from consignees.

4. Conrmation of balances from some of the Debtors and Creditors, have not been received.

5. The break up of Deferred Tax Assets/Liabilities are as under :

(Rs. in lacs)

Nature of timing difference Deferred TaxLiability/(Asset)

as at 1st April, 2007

(Debit/Credit)for the year

Deferred TaxLiability/(Assets)

as at 31st March, 2008(a) DEFERRED TAX LIABILITIES

Depreciation 6620.54 991.50 7612.04

SUB-TOTAL 6620.54 991.50 7612.04

(b) Deferred Tax assets

Expenses allowed on payment basis 309.37 (42.23) 267.14

Longterm capital loss to be set-off 0 0 0

SUB – TOTAL 309.37 (42.23) 267.14

6311.17 1033.73 7344.90




Schedules


LIMITED

6. RELATED PARTY INFORMATION.

(i) RELATIONSHIPS:

(a) SUBSIDIARY COMPANIESDCW Pigments Ltd

(b) WHERE CONTROL EXISTS

Double Dot Finance Ltd.

Crescent Finstock Ltd.

Sahu Brothers (Saurashtra) Pvt. Ltd.

Dhrangadhra Trading Company Pvt. Ltd.

Kishco Ltd.

Kalpataru Botanical Garden Pvt. Ltd.

Crescent Holdings Pvt. Ltd.

(c) KEY MANAGEMENT PERSONNEL

Dr. S. C. Jain Chairman & Managing Director

Shri P. K. Jain Managing Director

Shri Bakul Jain Managing Director

Smt. Vandana Jain Executive Director

Shri Vivek Jain Sr. President

Shri Mudit Jain President

Shri Ashish Jain President

Smt. Paulomi Jain Vice President

NOTE: Related party relationships on the basis of the requirements of Accounting Standard (AS) – 18 disclosedabove is as identied by the company and relied upon by the auditors.

(ii) DISCLOSURE OF TRANSACTIONS BETWEEN THE GROUP AND RELATED PARTIES AND THE STATUS OFOUTSTANDING BALANCES AS ON 31ST MARCH, 2008

(Rs. In lacs)

Particulars Enterprises wherecontrol exists

Key ManagementPersonnel

Commission paid 4.47

Remuneration paid 503.74

Purchases 1.13

Balances as on 31st March, 2008 5.56




Schedules


LIMITED

SEGMENT INFORMATION FOR THE YEAR 2007-08

(Rs. In lacs)

CAUSTIC PVC SODA ASH OTHERS TOTAL

SEGMENT REVENUE

External Revenue 21,824.64 39,233.57 14,228.47 733.59 76,020.2720,130.58 32,614.13 13,440.90 1,594.88 67,780.49

Inter Segment Revenue

Total Revenue 21,824.64 39,233.57 14,228.47 733.59 76,020.2720,130.58 32,614.13 13,440.90 1,594.88 67,780.49

RESULT

SEGMENT RESULT 881.50 3,686.29 1,463.26 373.44 6,404.49

571.55 437.46 1,289.32 1,280.93 3,579.26Add: Unallocated Corporate

Income 36.83 98.35

Less:Finance Charges

1,348.33

541.72

Current Tax 480.00375.92

Deffered Tax 1,033.73743.07

NET PROFIT 3,579.262,016.90

OTHER INFORMATION

Segment Assets 63,967.32 10,503.98 15,618.90 6,996.43 97,086.6341,943.28 9,808.73 14,869.26 6,309.45 72,930.72

Add: Unallocated CorporateAssets 1,750.42

533.20

Total 63,967.32 10,503.98 15,618.90 6,996.43 98,837.0541,943.28 9,808.73 14,869.26 6,309.45 73,483.92

Segment Liabilities 37,072.65 15,936.57 4,069.69 2,623.70 59,702.61

24,912.98 11,292.96 5,499.47 5,394.06 47,099.47

Add: Unallocated CorporateLiabilities 7,604.99

757.73

Total 37,072.65 15,936.57 4,069.69 2,623.70 67,307.6024,912.98 11,292.96 5,499.47 5,394.06 47,857.20

Capital Expenditure 25,904.2319,976.64

Depreciation 1,781.04 337.57 579.68 304.55 3,002.841,365.15 309.08 482.14 376.53 2,532.90




Schedules


LIMITED

7. Encroachers have occupied some portions of the land belonging to the Company at Sahupuram. Efforts are being made toevict them.

8. The Company has changed the method of valuation of closing stock of Caustic Soda Lye group by treating Chlorine, Hydrogen

Gas and Hydrochloric Acid as by-products instead of joint products. This has resulted into decrease in valuation of FinishedGoods by Rs. 48.21 lacs, which has decreased the Prot for the year by the same amount.

9. Sales Tax Assessments of Dhrangadhra Unit are pending from 1994-95, 1995-96, 1997-98 and 2004-05 to 2006-07 (exceptfor 1996-97, 1998-99 to 2003-04 which has been completed). Central Sales Tax Assessments and Tamilnadu General Salestax act of Sahupuram Unit are completed upto 2004-05 except for the year 2003-04.

10. In respect of land on lease, the future obligations towards lease rentals under the lease agreements as on 31st March, 2008amount to Rs. 112.98 lacs (previous year Rs. 189.29 lacs).

11. During the year the company has entered into option to hedge its exposure on US$ Libor related to its external commercialborrowing aggregating to US$ 20 Million.

The year end foreign currency exposure that have not been hedged by derivative instrument or otherwise PayablesRs. 18,121.65 lacs.

12. In the matter of custom duty on imported calciner, the Hon’ble Gujarat High Court, has vide order dated 15th December,2005, partly allowed company’s civil application for refund of Rs. 41.48 lacs, to the extent of Rs. 17.50 lacs, that has sincebeen received and denied claim for refund of balance Rs. 23.98 lacs on account of unjust enrichment. The Company hasled special leave petition before Hon’ble Supreme Court in this regard. The case is pending for hearing.

13. Computation of net prots under section 349 of the Companies Act, 1956.

(Rs.in lacs)

Particulars Amount

Prot before tax as per Prot & Loss Account 5092.99

Add:Wealth Tax paid 1.30

Managerial remuneration 435.11

Directors’ sitting fees 2.13

Less:Interest capitalized 225.82

Prot on sale of assets 496.08

Net prot U/S 349 4809.63

10% thereof i.e. (4809.63 X 10/110) 437.24

Less: Managerial remuneration paid 153.56

Commission payable 283.68

14. Based on Management’s review of the Capital Expenditure on Carbonation Towers and Calcium Chloride plant at SodaAsh plant in 2004-05 & 2006-07 respectively and based on detailed study by technical experts, justifying additions andmodications, the same are being held as capital work in progress. Till such time the Carbonation Towers and CalciumChloride plant becomes operational, interest of Rs. 225.82 lacs, for this year has been capitalized.

15. The Tamilnadu Government has passed fresh legislation imposing Electricity Tax on captive power generated with retrospectiveeffect from 2003. The company along with other captive power producers has challenged the levy in the Madras High Court,which has admitted the writ-petition.




Schedules


LIMITED

16. (a) Sundry Creditors ( Schedule K) include Rs. 9.22 lacs, due to small scale and ancillary undertakings outstanding formore than 30 days. This amount has been determined to the extent such parties have been identied from availableinformation. This has been relied upon by the auditors.

(b) The small scale undertakings from whom amounts outstanding for more than 30 days are as under.:-

1. Tamilnadu Synthetics, 2. Ganesh Polymenrs,

(c) In the absence of requisite information pertaining to Micro Small & Medium Enterprises under Micro Small & MediumEnterprises Development Act, 2006, dues to SSI undertakings is reported as per the earlier requirements.

17. Insurance claim received in respect of machinery Rs. 45.19 lacs (previous year Rs. NIL lacs) is taken as other income.

18. Due from companies in which Directors of the company are directors is Rs. NIL lacs (Previous year Rs. 0.31 lacs).

19. Disclosure pursuant to Accounting Standard – 15 (Revised) “Employee Benets”

(a) Effective 1st April’07, the company has adopted accounting standard 15 (revised 2005) “ Employee Benets” issuedby ICAI. The Company has classied the various benets provided to employees as under:

(b) Dened Contribution Plans:

The Company has recognized the following amounts in the Prot & Loss Account which are included under contributionto Provident Fund and Other Funds:

Rs. In Lacs

Provident Fund 186.11

Superannuation Fund 54.52

Employees Pension Scheme, 1995 127.29

The Rules of the Corporate Provident Fund administered by a Trust require that if the Board of Trustees are unable topay interest at the rate declared on Employees‘ Provident Fund by the Government under the Employees ProvidentFund Scheme, for the reason that the return on investment is less or for any other reason, then the deciency shall bemade good by the Company. Having regard to the assets of the fund and the return on the investments the Companydoes not expect any deciency in the foreseeable future.

(c) DenedBenetPlans

GratuityFundedRs. lacs

Leave WagesNon-Funded

Rs. lacs

1. ChangeinBenetObligation

Liability at the beginning of the year 1st April ’07 1600.00 382.63

Interest cost 128.00 32.57Current Service Cost 60.13 43.68

Benet Paid 18.13 (38.53)

Actuarial (gain)/Loss on obligation (67.20) 17.12

Liability at the end of the year 1702.80 437.46

2. Changes in the Fair Value of Plan Assets

(a) Present Value of Plan Assets as at 1st April, 2007 1401.94

(b) Expected Return on Plan Assets 130.53

(c) Actuarial (Gain)/Loss




Schedules


LIMITED

GratuityFundedRs. lacs

Leave WagesNon-Funded

Rs. lacs

(d) Employers’ Contributions 0.86

(e) Benets Paid 18.13

(f) Present Value of Planned Assets as at 31st March, 2008 1515.20

3. AmountRecognizedintheBalanceSheetincludingareconciliationofthePresentValueofDenedBenetObligationandtheFairValueofAssets

(a) Present Value of Dened Benet Obligation as at 31stMarch, 2008 1702.80 437.46

(b) Fair Value of Plan Assets as at 31st March, 2008 1515.20

(c) Net Liability recognized in the Balance Sheet

(as at 31st March,2008) 187.60 437.464. ExpensesRecognizedintheProtandLossAccount

(a) Service Cost 60.13 43.68

(b) Interest Cost 128.00 32.56

(c) Expected Return on Plan Assets 130.53

(d) Curtailment Cost/(Credit)

(e) Settlement Cost/(Credit)

(f) Net Actuarial (Gain)/Loss (67.20) 17.12

(g) Total Expenses recognized in the Prot and Loss A/c (9.59) 93.36

5. Actual Return on Plan Assets

6. EstimatedContributiontobemadeinthenextannualyear

7. The Composition of Plan Assets : i.e. Percentage of each Categoryof Plan Assets to Total Fair Value of Plan Assets as at 31st March,2008

(a) Govt of India Securities

(b) Corporate Bonds

(c) Special Deposit Scheme

(d) Equity Shares of Listed Companies

(e) Property

(f) Insurance Managed Funds 1515.20

(g) Others

(h) Total 1515.20

8. Actuarial Assumptions

Retirement age 58 58

Discount rate 8% 8%

Mortality LIC (1994-96) Ultimate

Withdrawal rate 1% - 3%

Salary escalation 4.5% 4.5%




Schedules


LIMITED

20. Acceptances under current liabilities are disclosed after netting off xed deposits for Rs. 5535 lacs (Previous Year Rs. NILlacs) given as security to the Company’s Bankers for issuing letter of credit. This does not understate current assets of thecompany.

21. Based on evaluation by the management of their being reasonable certinity that the company will be liable to pay normalincome tax within 7 subsequent years, MAT credit of Rs. 155 lacs (Previous Year Rs. 44.89 lacs), has been recognized as anasset with corresponding credit to prot and loss account.

22. Earning per share (EPS) as per Accounting Standard – 20

2007-08Rs.Lacs

2006-07Rs. lacs

Prot after Tax 3579.25 2016.88

No. of Equity shares of Rs. 2 each as on 31.3.2008

Basic 19,61,54,590 17,25,44,590

Diluted 18,81,55,574 17,25,44,590

EPS (Rs.)

Basic 1.82 1.17

Diluted 1.90 1.17

23 Information required in terms of Part IV of Schedule VI of the Companies Act, 1956 is attached.

Schedule “A” to “N” form an integral part of the Balance Sheet and Schedule “1” to “6” form an integral part of the Prot and Loss Account.

Previous year gures are regrouped to match with current years grouping.


For V.SankarAiyar&Co. Dr.ShashiChandJainChartered Accountants Chairman & Managing Director

S.Venkatraman VandanaJainPramodKumarJain BakulJain


Place : Mumbai ChitalV.Shah T.M.BhandariDate : 16th May, 2008 Asstt. Company Secretary Sr. Vice President (Finance)

Dr.V.H.Joshi

YuvarajSahebofDhrangadhra

SushilKumarJalan

R. V. Ruia

SatyawatiJainDirectors




Schedules

FORMING PART OF THE PROFIT AND LOSS ACCOUNT

LIMITED


Rs. in lacs


Rs. in lacs

SCHEDULE “1”SALES (less Rebates and Trade Discount but including excise duty)

Direct Sale * 46,904.86 39,776.09

Consignment Sales 30,118.40 28,211.79

Export Sales 9,116.76 7,167.00

Other Sales * 224.94 246.99

Sale of Services [TDS Rs. Nil (Previous Year Rs. 17.95 lacs)] 17.95

TOTAL 86,364.96 75,419.82

* Includes Sale of Traded Goods Rs. 9.01(Previous Year Rs. 33.75 lacs)

SCHEDULE “2”

OTHER INCOME

Prot/Loss on Sale of Investments 1.12

Prot on Sale of Fixed Assets 6.96 962.29

Unclaimed balance written back 40.45 5.95

Dividend received on current Investments 35.84 95.40

Dividend received on Long Term Investments 0.99 2.96

Bad Debts Recovered 0.34

Gain on Foreign Exchange Transactions (Net) 568.34 36.84

Miscellaneous Income 606.71 532.13

TOTAL 1,260.75 1,635.57




Schedules


LIMITED


Rs. in lacs


Rs. in lacs

SCHEDULE “3”MANUFACTURING AND OTHER EXPENSES

1. Consumption of Materials : Raw Materials

Stock in hand and in process as at opening 2,896.36 3,239.82

Add: Purchases 41,711.60 32,833.91

Less: Closing stock in hand & in process (including taxes duties etc.) 2,485.58 2,896.36

TOTAL 42,122.38 33,177.37

2. (a) INCREASE/DECREASE IN STOCK

Closing Stock:

Manufactured Products 3,632.96 1,787.03


Packing Drums and Scrap 269.89 35.77

Coke Dust & Gypsum 40.29 54.16

Stock of Traded Shares 8.58 8.25

4,039.51 1,943.30

Opening Stock:

Manufactured Products 1,619.03 5,690.39


Packing Drums and Scrap 35.77 31.22Coke Dust & Gypsum 54.16 52.43

Stock of Traded Shares 8.25 8.25

1,775.30 5,853.46

Opening Stock – Closing Stock (2,264.21) 3,910.16

Closing Stock – Excise Duty (502.97)

Opening Stock – Excise Duty 168.00

(334.97)

(b) Purchases for resale (Net of stock of traded goods capitalised/written off) 9.26 32.73

TOTAL (2,589.92) 3,942.89

3. SALARIES, WAGES & BENEFITS TO EMPLOYEES

Salaries & Wages 3,473.89 2,967.12

Contribution to Provident and other Funds 429.72 445.37

Employees’ Welfare 353.71 336.64

TOTAL 4,257.32 3,749.13

4. Power and Fuel 13,400.19 12,221.66






Schedules


LIMITED


Rs. in lacs


Rs. in lacs

SCHEDULE “3” (Contd.) (b) Details of Directors’ Remuneration under Section 198

(i) Managing Director’s and Whole time Directors’ Remuneration :Salary 96.00 96.00Perquisites on House 9.60 9.60Gas, Electricity expenses 10.64 Company’s Contribution to PF 8.64 9.59Leave Travel Concession 4.93 Medical Expenses 10.82 7.53Company’s Contribution to Superannuation 10.80 12.00Commission 283.68 134.31MD’s Leave Encashment 13.69

(ii) Directors Sitting Fees 2.13 1.05437.24 283.77

Less : Amount capitalised 39.48 33.38

397.76 250.39

TOTAL 66,612.91 61,570.00

SCHEDULE “4”

INTEREST AND FINANCE CHARGES

Fixed loans 899.98 307.35Others 557.03 398.15

1,457.01 705.50

Less : Interest from banks & others (TDS Rs. 22.10 lacs)(Previous Year Rs. Nil lacs) (108.67) (34.92)

TOTAL 1,348.34 670.58

SCHEDULE “5”

DEPRECIATION

Depreciation on Fixed Assets for the year 3,026.55 2,565.49

3,026.55 2,565.49

Less : Drawn from Revaluation Reserve 23.70 32.61

TOTAL 3,002.85 2,532.88






Dr. V. H. Joshi


Sushil Kumar Jalan

R. V. Ruia





Schedules


LIMITED

SCHEDULE “6”

(a) Quantitative information with regard to each class of goods manufactured/traded (as certied by Chairman & Managing Director)

PARTICULARS CAPACITY - MT OPENING STOCK PRODUCTION SELFCONSUMP-

TION

CLOSING STOCK SALES

Licensed Installed Quant ityMT

ValueRs. in lacs

QuantityMT

QuantityMT

QuantityMT

ValueRs. in lacs

QuantityMT

ValueRs. in lacs

Dharangadhra Unit

Soda Ash 96,000 96,000 414 38.70 81,248 12,212 1,429 153.29 68,021 8,655.55(96,000) (96,000) (1,437) (124.54) (80,816) (10,136) (414) (38.70) (71,703) (7,859.37)

Soda Bicarbonate 12,000 12,000 212 22.20 16,050 716 84.18 15,546 1,922.43(12,000) (12,000) (1,533) (147.42) (18,299) () (212) (22.20) (19,620) (2,212.93)

Amonium Bicarbonate 5,000 0.04 446 15 1.52 431 45.02(5,000) () (13) (1.04) (1,599) () () (0.04) (1,612) (149.46)

Detergent – Green 7,772 220 22.64 7,552 1001.79() () () () (4,482) () () () (4,482) (590.87)

Detergent – Active 247 28.98 33,544 418 50.73 33,373 5,165.39

() () () () (31,431) () (247) (28.98) (31,184) (4,804.51)

Sahupuram Unit

Caustic Soda Lye 1,00,000 1,00,000 1,064 133.64 63,025 21,947 2,495 443.06 39,647 6,104.82(60,000) (60,000) (1,346) (147.75) (56,210) (22,664) (1,064) (133.64) (33,828) (5,047.55)

Caustic Soda Solid 5 0.68 137 20 4.50 122 29.30() () (5) (0.70) (89) () (5) (0.68) (89) (21.09)

Caustic Soda Flakes 647 102.98 20,676 128 236 51.02 20,959 4,474.21() () (390) (55.23) (21,612) (91) (647) (102.98) (21,264) (4,435.06)

Sodium Hypochlorine 3,716 15 3,701 97.9() () () () (2,199) (2) () () (2,197) (56.59)

Hydrochloric Acid 100% 90,000 66,000 17 0.69 43,554 37,515 58 1.22 5,998 257.86(39,600) (33,000) (14) (0.61) (38,257) (35,916) (17) (0.69) (2,338) (116.63)

Liquid Chlorine 36,000 36,000 41 2.28 13,280 5,578 263 8.36 7,480 394.00

(40,000) (40,000) (116) (7.54) (12,470) (6,003) (41) (2.28) (6,542) (409.41)Trichloroethylene 7,200 7,200 266 127.34 3,795 684 276.40 3,377 1,753.17

(5,400) (5,400) (373) (169.22) (3,920) (1) (266) (127.34) (4,026) (2,101.47)

Upgraded Ilmenite 72,000 48,000 2764 709.60 37,934 3,339 734.78 37,359 9,366.07No Licence

Required (25,000) (1,681) (383.62) (35,841) () (2,764) (709.60) (34,758) (8,968.66)

Utox No Licence 600 115 21.82 1792 5 796 141.5 1106 333.53Required (600) (66) (10.78) (829) (4) (115) (21.82) (776) (216.76)

Ferrie Chloride 10,000 525 5.97 3,890 30 146 1.66 4,239 229.51() (10,000) (302) (2.80) (4,115) (14) (525) (5.97) (3,878) (111.24)

Yellow Iron Oxide 0.30 278 12 4.16 266 86.03() () (15) (4.67) (186) () () (0.30) (201) (59.83)

PVC Resin 90,000 90,000 1,117 534.43 87,347 3 4,319 2,103.15 84,142 45,500.14() (60,000) (10,619) (4,539.55) (67,140) (1) (1,117) (534.43) (76,641) (37,206.24)

Caustic Soda Lye 50 50 (Traded Goods) () () () () (170.00) () () () (170) ()

Misc. Sales () () () () () () () () () ()

TOTAL 85,416.72(74,367.67)

Note : 1. Licensed capacity is not applicable in view of the company’s products having been delicensed as per the new liberalised licensing policy announced by the Governmentof India.

2. Ammonium Bicarbonate production is out of part of Soda ash plant.

3. Self consumption quantity mentioned includes quantity lost in handling, lost in transit, wash loss, samples, etc.

4. Previous year gures are given in bracket.

5. Lye sales quantity excludes 113 mt excess as per survey.




Schedules


LIMITED

Rs. in lacs

SCHEDULE “6” (Contd.)

Consolidated

(b) Expenditure in Foreign Currency

(i) Know-how fees ()

(ii) Consultant fees 23.43(49.66)

(iii) Others 586.65(559.08)

(c) Earnings in Foreign Exchange

(i) Export on F.O.B. basis 8,903.17(7,095.79)

(ii) Others 12.82(12.73)

(d) Consumption of imported/indigenous Raw Materials,Stores and Spares at Landed Cost

Raw Material Imported 32,127.90(23,831.22)

Indigenous 11,139.88(10,084.88)

Stores and Spare parts (Including Consumption for Capital jobs)

Imported 477.39(1,603.71)

Indigenous 8,529.70(14,974.74)

Mercury

Imported 32.50(1.82)

Indigenous ()

(e) Value of Imports on C.I.F. basis

(i) Raw Materials 30,385.41(22,719.56)

(ii) Fuel Oil

()(iii) Mercury

(14.71)

(iv) Stores and Spare parts 248.34(224.61)

(v) Capital Goods 1,550.50(1,059.14)

(f) Amount remitted in Foreign Currencies on account of Dividend ()




Schedules


LIMITED

TOTALQuantity

(M.T)Value

Rs. in lacs

SCHEDULE “6” (Contd.)(g) Raw Materials consumed:

Salt 326,112 722.80(317,316) (480.28)

Ilmenite Sand 77,243 2,979.90(71,794) (2,694.22)

Calcium Carbide 2,848 765.98(2,893) (726.32)

Vinyl Chloride Monomer 88,301 31,012.53(67,938) (22,918.29)

Lauryl Peroxide 24 64.37(19) (51.91)

Limestone 193,345 1,318.79(210,781) (1,387.20)

Coke 18,162 1,376.03(19,910) (1,283.31)

Ammonia 1,635 294.73(1,808) (331.08)

Others 3,652.64

() (3,286.13)

Consumption of own manufactured products and Intermediates 1,080.72() (757.35)

TOTAL 43,268.49(33,916.09)






Dr. V. H. Joshi


Sushil Kumar Jalan

R. V. Ruia





LIMITED

Statement Pursuant to Part IV of Scheme VI of the Companies Act, 1956Balance Sheet Abstract And Company’s General Business Profle

Balance Sheet Date

Registration No. 7 4 8

I. Registration Details

II. Capital raised during the year (Amount in Rs. Thousands)

III. Position of Mobilisation and Deployment of Funds (Amount in Rs. Thousands)

3 1 / 0 3 / 2 0 0 8

State Code 0 4

Public Issue

N I L

Bonus IssueN I L

Rights Issue

N I L

Private Placement4 7 2 2 0

Total Liabilities9 8 8 3 7 0 5

Total Assets9 8 8 3 7 0 5

Source of FundsPaid up Capital

3 9 2 3 0 9Secured Loans3 8 2 3 3 9 6

Reserves & Surplus

2 6 9 1 7 8 8Unsecured Loans4 9 2

Application of FundsNet Fixed Assets

7 1 1 1 0 5 6Net Current Assets

4 0 3 5 9 2

Accumulated Losses

N I L

Investments

1 2 7 8 2 7Misc. Expenditure

N I LProject Expenditure

N I L

IV. Performance of Company (Amount in Rs. Thousands)

Turnover

8 6 3 6 4 9 6

+ – Port/Loss Before Tax

+ 5 0 9 2 9 9

Earnings per Share in Rs.

1.82

Total Expenditure

7 0 9 6 4 1 0

+ – Prot/Loss After Tax

+ 3 5 7 9 2 6

Dividend Rate (%)

15

V. Generic Names of Three Principal Products/Services of the Company (as per monetary term)

a) Item Code No. (ITC Code)

3 9 0 0 4 2 1 0 22 8 1 5 1 1 0 12 8 3 6 2 0 0 9

Product Description

POLY VINYL CHLORIDE BY SUSPENSIONCAUSTIC SODASODA ASH

(Date / Month / Year)

Deferred Tax Liabilities7 3 4 4 9 0






Dr. V. H. Joshi


Sushil Kumar Jalan

R. V. Ruia





LIMITED

STATEMENT REGARDING SUBSIDIARY COMPANIES PURSUANTTO SECTION 212 OF THE COMPANIES ACT, 1956.

1. Name of Subsidiary DCW Pigments Limited

2. Financial year ended 31st March, 20083. Holding Company’s Interest:

Equity Capital :

Number of Shares of Rs. 10/- each 49,500

Extent of Holding 99%

4. The net aggregate of Prot/( Loss) of the Subsidiary Company in so far as it concerns themembers of the Holding Company:

(a) Not dealt with in the accounts of the Company for the year ended 31st March, 2008:

(1) For the Subsidiary’s nancial year ended as in 2 above

(2) For the previous nancial years of the Subsidiary

(b) Dealt with in the accounts of the Company for the year ended 31st March, 2008:

(1) For the Subsidiary’s nancial year ended as in 2 above

(2) For the previous nancial years of the Subsidiary






Dr. V. H. Joshi


Sushil Kumar Jalan

R. V. Ruia





TO THE SHAREHOLDERSfor the year ended 31st March, 2008

Your Directors present the 1st AnnualReport of your Company together with

the Audited Accounts for the year ended31.03.2008.

OperationsThe Company has not yet commenced itsoperations.

DirectorsShri Mudit Jain retire by rotation and beingeligible offers for reappointment. Shri. VivekJain who was appointed as an AdditionalDirector holds ofce up to the date of theforthcoming Annual General Meeting.Notice has been received from a memberunder Section 257 of the Companies Act1956 signifying his intention to propose the

candidature of Shri Vivek Jain as a Directorof the Company.

Conservation of Energy, TechnologyAbsorption and Foreign Exchange earningsand outgo.

As the Company has not commenced anyoperations, there is nothing to Report on

Conservation of Energy and TechnologyAbsorption. During the year there is noForeign Exchange Earnings and Outgo.

Particular of Employees.

During the year, no employee receivedremuneration in excess of the limitsprescribed under Section 217(2A) of theCompanies Act, 1956 and the Rules madethereunder.

Directors’ Responsibility StatementIn terms of Section 217(2AA) of theCompanies Act,I956, your Directorshave :

I . Followed in the preparation of theannual accounts, the applicableaccounting standards have followedwith proper explanation relating tomaterial departures;

2. selected such accounting policiesand applied them consistently andmade judgement and estimates thatare reasonable and prudent so as togive a true and fair view of the sale of affairs of the Company at the end of thenancial year and of the Prot/ Loss of the Company for that period;

Directors’ Report 3. taken proper and sufficient care

of the maintenance of adequateaccounting records in accordancewith the provisions of this Act forsafeguarding the assets of the Company

and for preventing and detecting fraudand other irregularities to the best of their knowledge and ability;

4. prepared the annual accounts on agoing concern basis.

AuditorsM/s. Ashok Shetty & Company, CharteredAccountants - Statutory Auditors of theCompany hold ofce until the conclusionof the forthcoming Annual General Meetingand are eligible for reappointment.

For and on behalf of the Board

Dr. S. C. JainChairman

Place : MumbaiDate : 15th May, 2008Registered Ofce:358, Anna Salai, Thousand LightsChennai - 600 006Tamil Nadu

To,

The Members,DCW Pigments Ltd., Mumbai

(I) We have audited the attachedBalance Sheet of M/s. DCW PigmentsLtd. as at 31st March 2008, annexedthereto. These nancial statements arethe responsibility of the Company’sManagement. Our responsibility is toexpress an opinion on these nancialstatements based on our audit.

(2) We conducted our audit in accordancewith auditing standards generallyaccepted in India. Those Standardsrequire that we plan and perform theaudit to obtain reasonable assuranceabout whether the nancial statementsare free of material misstatement. Anaudit includes examining on a testbasis, evidence supporting the amountand disclosures in the nancialstatements. An audit also includeassessing the accounting principlesused and signicant estimatesmade by the management, as wellas evaluating the overall nancialstatements presentation. We believethat our audit provides reasonablebasis for our opinion.

(3) Since the Company has notcommenced operations, we do nothave any comments as required by

the Companies (Auditors‘ Report)Order 2003 and read together withthe Companies (Auditors‘ Report)amendment order, 2004, issued bythe Central Government in terms of Section 227(4A) of the Companies Act1956.

(4) For the above:(i) We have obtained all the

information and explanations,which, to the best of ourknowledge and belief werenecessary for the purpose of ouraudit.

(ii) In our opinion proper books of accounts as required by law,have been kept by the Companyso far as it appears from our

examination of such books.(iii) The Company‘s Balance Sheetdealt with by this report is inagreement with the books of accounts.

(iv) In our Opinion, the Balance Sheetdealt with by this report complieswith the Accounting Standardsreferred to in sub-section (3C) of Section 211 of the CompaniesAct 1956.

(v) On the basis of writtenrepresentation, received from theDirectors as on 31st March 2008

and taken on record by the Boardof Directors, we report that, noneof the Directors is disqualied ason March 31st, 2008, from beingappointed as a Dircetor in termsof Clause (g) of sub-section (I) of Section 274 of the CompanicsAct 1956.

(vi) In our opinion and to the best of our information and accordingto the explanation given to us,the said Balance Sheet readtogether, with the notes thereongive information required bythe Companies Act, 1956 in themanner so required and give atrue and fair view in conrmitywith the accounting principlesgenerally accepted in India:

(i) In so far as it relates to, theBalance Sheet, of the state of affairs of the Company as at31st March, 2008.

(ii) Since the Company has notcommenced activity, Protand Loss Account is notprepared.

For ASHOK SHETTY & CO.Chartered Accountants

ASHOK R. SHETTYM. No. 102524

Mumbai, Dated: 15th May, 2008

Auditors’ Report

DCW Pigments Ltd.




Balance Sheet


As at31/03/2008

Rs.

As at31/03/2008

RsSHARE CAPITAL

Authorised

100000 Equity Shares of Rs. 10/- each 1,000,000 Current Account with Punjab National Bank 464,258

ISSUED AND PAID-UP

50000 Equity Shares of Rs. 10/- each 500,000 Miscellaneous Expenses not written off (Preliminary and Pre-operative)

41,360

SUNDRY CREDITORS

Liability for expenses 5,618

TOTAL 505,618 TOTAL 505,618

For and on behalf of the Board

For Ashok Shetty & Co. Dr. Shashi Chand JainChartered Accountants Chairman

Vandana Jain Bakul Jain

Vivek Jain

Mudit Jain

Partner Executive Director

Place : Mumbai Chital V. ShahDate : 15th May, 2008 Asstt. Company Secretary Directors

NOTES FORMING PART OF ACCOUNTS

1. The Company is yet to commence its manufacturing operations.

2. This being the rst year of audited accounts after incorporation of the Company, Corresponding previous gures are not availablefor comparison.

3. Pending allocation of Preliminary & Pre-operative expenses like Filing Fees, Registration Charges, Stamp duty etc., carried to

Balance Sheet.

DCW Pigments Ltd.



DCW Limited Ò Annual Report 2007-2008 53

LIMITED

AUDITOR’S REPORT TO THESHAREHOLDERS OF DCW LIMITED

We have audited the attached consolidatedbalance sheet of DCW Limited (the“Company”) and its subsidiary DCW

Pigments Limited as at 31st March, 2008,consolidated prot and loss account forthe year ended on that date and also theconsolidated cash ow statement for theyear ended on the date annexed thereto(hereinafter collectively referred to asthe ‘consolidated nancial statements’).These consolidated nancial statementsare the responsibility of the Group’smanagement and have been prepared bythe management on the basis of separatenancial statements of the entities of thegroup. Our responsibility is to express an

opinion on these consolidated nancialstatements based on our audit.

We conducted our audit in accordancewith the auditing standards generallyaccepted in India. Those standards requirethat we plan and perform the audit to obtainreasonable assurance about whether the

Auditor’s Report consolidated nancial statements are freeof material misstatement. An audit includesexamining, on a test basis, evidencesupporting the amounts and disclosuresin the consolidated nancial statements.An audit also includes assessing the

accounting principles used and signicantestimates made by management, aswell as evaluating the overall nancialstatement presentation. We believe thatour audit provides a reasonable basis forour opinion.

We did not audit the nancial statementsof DCW Pigments Ltd., the subsidiarywhose nancial statements reect totalassets of Rs. 5 lacs as at 31st March 2008,total revenue of Rs. Nil and cash owsamounting to Rs. 5 lacs for the year thenended as considered in the consolidatednancial statements. These nancialstatements and other nancial informationhave been audited by the other auditorswhose reports have been furnished to usand our opinion in respect of thereof isbased solely on the report of such otherauditors.

We report that the consolidated nancialstatements have been prepared by theGroup’s management in accordance withthe requirements of Accounting Standard21 issued by the Institute Of CharteredAccountants of India.

Based on our audit and considerationof reports of other auditors on separatenancial statements of the entity and tothe best of our information and accordingto the explanations given to us, we are of the opinion that the attached consolidatednancial statements give a true and fairview in conformity with the accountingprinciples generally accepted in India; incase of:

(a) the consolidated balance sheet, of the state of affairs of the Group as at

31st March 2008;(b) the consolidated prot and loss

account, of the prot for the yearended on that date; and

(c) the consolidated cash ow statement,of the cash ows for the year endedon that date.

For V Sankar Aiyar & CoChartered Accountants

S.VenkatramanPlace : Mumbai Partner

Dated : May 16, 2008 Membership No 34319



54 DCW Limited Ò Annual Report 2007-2008

LIMITED Consolidated Balance Sheet


Schedule

As at31/03/2008

Rs. in lacsSOURCES OF FUNDS

Shareholders’ Funds :Capital A 3,923.09Reserves and Surplus B 26,917.88Minority Interest 0.05

Loan Funds :Secured Loans C 38,233.96Unsecured Loans D 4.92

Deferred tax liability(Refer Note B - 5 of Schedule - N)

Deferred tax liability 7,612.03Less : Deferred tax asset (267.13)

7,344.9045,583.83

TOTAL 76,424.80

APPLICATION OF FUNDSFixed Assets :

Gross Block E 83,983.17Less : Depreciation 28,020.94

55,962.23Capital Work-in-progress 15,100.04Machinery/spares for erection and replacement 48.29

71,110.56Investments F 1,273.32Current Assets, Loans and Advances

Inventories G 12,466.74

Sundry Debtors H 6,475.13Cash and Bank Balances I 978.10Loans and Advances J 6,532.89

26,452.86Less: Current Liabilities and Provisions

Liabilities K 20,838.74Provision L 1,573.62

22,412.36Net Current Assets 4,040.50Misc. Expenses not Written Off 0.42Contingent Liabilities not provided for MSignicant Accounting Policies and Note forming part of NBalance Sheet and Prot and Loss Account

TOTAL 76,424.80






Dr. V. H. Joshi


Sushil Kumar Jalan

R. V. Ruia





LIMITEDConsolidated Proft and Loss Account

FOR THE YEAR ENDED MARCH, 2008


Rs. in lacs

INCOME

Sales 1 86,364.96

Less: Excise Duty (11,568.62)

Net Sales 74,796.34

Other Income 2 1,260.75

76,057.09

EXPENDITURE

Manufacturing and Other expenses 3 66,612.91

Interest & Finance Charges (Net) 4 1,348.34

67,961.25

Depreciation 5 3,002.8570,964.10

Prot before tax 5,092.99

Current Tax 575.00

Fringe Benet Tax 60.00

MAT Credit Available for set off (155.00)

Prot after Current Tax & Tax Adjustments 4,612.99

Deferred Tax (Refer Note B - 5 of Schedule N) 1,033.73

Prot after Deferred tax 3,579.26

Add : Surplus brought forward from last year 2,440.53

Available for appropriation 6,019.79APPROPRIATION

Transfer to General Reserve 2,000.00

Proposed/Final Dividend on Equity Shares 588.46

Tax on Proposed/Final Dividend 100.01

2,688.47

Prot Carried forward 3,331.32

Notes to Prot & Loss Account 6

Basic earning per share 1.82

Diluted earning per share 1.90






Dr. V. H. Joshi


Sushil Kumar Jalan

R. V. Ruia





LIMITED

CONSOLIDATED CASH FLOW STATEMENT FOR THE YEAR ENDED 31st MARCH, 2008

2007-08Rs. in Lacs

A. CashowfromoperatingActivitiesNet prot before tax and extraordinary items 5092.99

Adjustments for :Non-cash items 49.83Depreciation 3,002.85Interest (net) 1,348.34Dividend income (36.83) 4,364.19

Operating prot before working capital changes 9,457.18

Adjustments for :Trade and other receivables 2,464.45Inventories (5,429.46)Current liabilities and provisions 3,738.48 773.47

Cash generation from operations 10,230.65Direct taxes paid (731.93)

Cash ow before Extraordinary itemsExtraordinary items

NetcashowfromoperatingActivities 9,498.72

B. CashowfromInvestingActivitiesPurchase of xed Assets (25,345.90)Sale of Fixed Assets 570.59Purchase / Sales of Investments (1,226.68)Preliminary expenses incurred (0.42)Dividend Income 36.83Interest income 108.67

Net cash used in investing Activities (25,856.91)

C. CashfromnancingactivitiesProceeds from issue of share capital 2,834.05

Repayment of loans (3,402.86)Repayment of Other borrowings (57.83)Proceeds from Long Term Borrowings 20,469.20Proceeds from Short Term Borrowings (144.48)Interest paid (1,312.56)Dividend paid (517.63)Tax on dividend (87.97)

NetcashusedinnancingActivities 17,779.92

Net increase in Cash and Cash equivalents 1,421.73

Cash & Cash Equivalents as at 1st April 2007 (443.63)Cash & Cash Equivalents as at 31st March 2008 978.10

1,421.73






Dr. V. H. Joshi


Sushil Kumar Jalan

R. V. Ruia





LIMITED

As at31/03/2008

Rs. in lacs

SCHEDULE “A”SHARE CAPITALAuthorised Capital

32,50,00,000 Equity Shares of Rs. 2/- each 6,500.00(Previous Year 32,50,00,000 Equity Shares @ Rs. 2-each)TOTAL 6,500.00

ISSUED, SUBSCRIBED AND PAID-UP CAPITAL19,61,54,590 Equity Shares of Rs. 2/- each 3,923.09(Previous Year 17,25,44,590 shares @ Rs. 2-each)TOTAL 3,923.09

SCHEDULE “B”RESERVES AND SURPLUSCAPITAL RESERVEAs per last balance sheet 355.83

Add: Transfer from Contribution for Capital 51.05Expenditure

406.88CAPITAL REDEMPTION RESERVEAs per last Balance sheet 5.30SHARE PREMIUMAs per last balance sheet 7,079.70 9,440.70Add : Received during the year 2,361.00

REVALUATION RESERVEAs per last balance sheet 1,240.50Less : Transferred to Prot and Loss Account 307.86

932.64GENERAL RESERVE

As per last balance sheet 10,801.04Add : Transfer from P&L account 2,000.0012,801.04

CONTRIBUTION FOR CAPITAL EXPENDITUREAs per last balance sheetLess : Transfer to Capital Reserve Prot and loss Account 3331.32

TOTAL 26,917.88

SCHEDULE “C”SECURED LOANSBanks

Term loans in Rupees 22,200.52Term loan in Foreign Currency 8,019.98 30,220.50

Working Capital Loans 337.03Other Loans

Financial Institutions 6,426.43Term Loans From NBFC 1,250.00TOTAL 38,233.96

SCHEDULE “D”UNSECURED LOANSShort Term Loans – Banks OTHERS

Deferred Sales Tax Credit 4.92TOTAL 4.92Due within one year Rs. 1.79 lacs (Previous Year Rs. 1443.60 lacs)

Schedules

FORMING PART OF CONSOLIDATED BALANCE SHEET




LIMITED

Schedules

FORMING PART OF T

HE CONSOLIDATED BALANCE SHEET

SCHEDULE “E” (consolidated)

FIXED ASSETS

Rs. in Lacs

GROSS BLOCK

DEPRECIATION

NET BLOCK

Description of

Assets

At cost or

Revalued

Book Value

as at

01-04-2007

Additions

and other

transfers

Sales and

other

deduc-

tions

At cost or

Re

valued

Book Value

as at

31-03-2008

Depreciation

For The

Year

Depreciatio

n

As at

31-03-200

8

As at

31-03-2008

Land

456.19

1.65

457.83

457.83

Buildings

5,206.03

1,210.92

8.20

6,

408.73

132.15

1,953.3

1

4,455.42

Plant and Machinery

52,842.29

26,791.21

4,337.54

75,

295.96

2,766.83

25,093.7

6

50,202.20

Furniture & Fittings

636.41

70.41

0.92

705.88

37.58

529.2

6

176.63

Railway Sidings

Vehicles

1,053.25

117.62

56.13

1,

114.75

89.99

444.6

1

670.14

TOTAL

60,194.17

28,191.80

4,402.81

83,

983.16

3,026.55

28,020.9

4

55,962.22

Previous Year

59,978.53

5,082.09

4,866.46

60,194.16

2,565.49

28,491.7

6

31,702.40

Notes:

1.

See Note “B-2” of Schedule “N”.

2.

Buildings include Rs. 523.06

lacs being cost of ownership ats and ofce accommodation in Co-operat

ive Societies and a Limited Company against which the

Company holds shares of the

face value of Rs. 0.77 lacs in Co-operative Societies and the Limited Company.

3.

Land includes the leasehold land valued at Rs. 70.99 lacs.

4.

Assignment deeds in respect of 9.13 acres of Land at Caustic Soda Division, transferred by Central Gove

rnment to the State Government, are yet to be executed

by the State Government in f

avour of the Company.

5.

Land, Building and Plant and

Machinery located at Sahupuram Wo

rks (other than PVC Division) were revalued on 31.03.1993.

6.

The Company exercised the option to purchase 793.39 acres of land leased by the State Government at Sa

hupuram works. Assignment deeds in respect of the said

land are yet to be executed b

y the State Government in favour of the Company.




LIMITED

SCHEDULE “F” As at 31/03/2008

INVESTMENTS (At Cost)

FaceValue per

Share/

UnitBond Rs.

No. of Shares/Bonds

AmountRs. inLacs

I. LONG TERM :

In Govt. & Trust Securities Unquoted

7 years National Savings Certicates 1,000 10 0.10

In other Companies-Non-Trade (Unquoted)

The Dhrangadhra Peoples Co-op. Bank Ltd. 25 10 *250

In Govt. & Trust Securities (Quoted)

Unit Trust of India - 6.75 % Tax Free Bonds 100 19,358 19.36

Less : Diminution value of Bonds 19,358

19.36In other Companies-Non-Trade (Quoted)

Fully paid Equity Shares

Global Trust Bank Ltd. 10 19,000 1.90

LIC Housing Finance Ltd. 10 17,400 10.44

12.34

Less : Diminutions value of shares of Global Trust Bank 19,000 1.90

10.44

II. CURRENT INVESTMENTS :

Fully paid Equity SharesTata Consultancy Services Ltd. 1 6 0.03

Reliance Petroleum Ltd. 10 28,040 16.82

16.85

MUTUAL FUNDS

Principal Mutual Fund - Floating Rate Fund FMP 10 1,22,29,943.473 1,226.57

1,226.57

TOTAL 1,273.32

* Figures Denote Amount in Rupees

31/03/2008Rs. in Lacs

Aggregate Value of long term quoted investments 48.66

Aggregate Value of current quoted investments 43.86

TOTAL 92.52

Aggregate Value of unquoted investments 5.05

Market Value of quoted investments 112.16

Schedules





LIMITED Schedules


As at31/03/2008

Rs. in lacs

SCHEDULE “G”INVENTORIES

(As Certied by the Management)

(Refer Note A-6 of Schedule 'N')

Stores, Spare Parts, Fuel 5,389.72

Packing Materials (at or below cost) 48.95

Stock-In-TradeRaw materials on hand & in transit 2,485.58

Finished Goods 4,135.93

Stock in process 87.79

Packing Drums & Scrap 269.90

Coke dust, Gypsum 40.29Shares (Refer Statement below) 8.58

TOTAL 12,466.74

Investments in shares (Stock in trade) As at 31/03/2008

Particulars

FaceValue perShare Rs.

No of Shares

AmountRs. in

lacs

Quoted

Reliance Industries Ltd 10 561 0.44

Reliance Communication Ltd. 5 553

Reliance Energy Ltd. 10 41 Reliance Natural Resources Ltd. 5 553

Reliance Capital Ltd. 10 27

Grasim Industries Ltd. 10 700 2.01

Ranbaxy Laboratories Ltd. 5 5,426 5.60

Reliance Industrial Infrastructure Ltd. 10 1,900 0.19

Indian Telephone Industries Ltd. 10 3,400 0.34

IPCL 10

TOTAL 8.58

Face ValueRupees

No. of Units/Shares

SCHEDULE “F” (Contd.)

Investments Purchased and Redeemed/Sold during the year:I. MUTUAL FUND UNITS:

SBI Mutual Fund - Magnum Insta Cash Fund – DDR 10 16,895,219.78SBI Mutual Fund - Premier Liquid Fund - Instl. Plan – DDR 10 20,267,965.11Principal Mutual Fund - Cash Mngt. Fund - Liquid Institutional Premium - DDR 10 385,846,096.89Principal Mutual Fund - Cash Management Fund – Floating Rate Fund FMP 10 12,224,963.29Principal Mutual Fund - Cash Management Fund – Institutional Plan - DDR 10 680,784.87




LIMITEDSchedules


As at31/03/2008

Rs. in lacs

SCHEDULE “H”

Sundry Debtors (Unsecured unless otherwise stated)

(a) Over 6 Months

Considered good (Secured) 30.00

Considered good 657.60

Considered doubtful 276.47

(b) Other Debts (considered good) 5,787.53

6,751.60

Less : Provision for doubtful debts 276.47

TOTAL 6,475.13

SCHEDULE “I”

CASH AND BANK BALANCES

1. Cash on hand 9.86

2. Cheques, Stamps, Hundi papers on hand 0.05

3 Balance with Scheduled Banks

a. in Current Account 965.40

b. in Fixed Deposits (Pledged with Bank as Margin Money) 2.76

4. Post ofce Savings Deposit (Pass Book Pledged with Central Excise Department) 0.01

5 Balance with Dhrangadhra People's Co-op Bank Ltd. (Maximum amount outstanding Rs. 0.85 lacs) 0.02

TOTAL 978.10

SCHEDULE “J”

LOANS AND ADVANCES (Unsecured, Considered Good)

Advances recoverable in cash or kind or for value to be received (Including advance for capital items) 1,668.89

Inter Corporate Deposits – Considered Good 0.10

Staff loans 48.45

Interest accrued on Inter Corporate Deposits 26.95

DCW Pigments Ltd.

Electricity and other Deposits 150.93

Balance with Customs, Central Excise etc. 4,057.74

Claims against Insurance, Railways, Custom etc. 107.58

Mat Credit Entitlement 472.25

6,532.89




LIMITED Schedules


As at31/03/2008

Rs. in lacs

SCHEDULE “K”LIABILITIES

Acceptances against Letters of Credit 13,863.49

*Sundry Creditors 3,806.58

Advances from customers and consignees 1,418.06

Trade and Other Deposits 425.63

Unclaimed Dividend # 27.15

Unclaimed Public Deposit Monies # 0.04

Other Liabilities 1,030.45

Interest accrued but not due on Loans 267.34

TOTAL 20,838.74

SCHEDULE “L”PROVISIONS

Proposed/Final Dividend - Equity 588.46

Tax on Proposed/Final Dividend 100.01

Provision for Tax (net off Advance Tax and Tax 233.09

Deducted at Source)

Provision for fringe benet tax 27.00Provision for Retirement & Other Emp. Benets 625.06

TOTAL 1,573.62

SCHEDULE “M”A. CONTINGENT LIABILITIES NOT PROVIDED FOR :

1. Disputed Sales Tax Demands 982.37

2. Disputed Excise Demands 304.97

3. Disputed Customs Demands 197.20

4. Company’s contribution to ESI not made pursuant to petitions for exemption pending beforeHigh Court 85.87

5. Lease Rent, Local Cess, Interest on Lime Stone, Surcharge,Stamp Duty, Octroi & Water and Electricity charges 1,826.41

6. Disputed Industrial relations matters 293.12

TOTAL 3,689.94

B. GUARANTEE AS A MEMBER OF THE ALKALI MFRS. ASSN.

(A Company Limited by Guarantee) Rs. 500




Schedules

FORMING PART OF THE CONSOLIDATED BALANCE SHEET

LIMITED

SCHEDULE - “N”

SIGNIFICANT ACCOUNTING POLICIES AND NOTES FORMING PART OF THE CONSOLIDATED FINANCIALS FOR THE YEARENDED 31ST MARCH, 2008.

SIGNIFICANT ACCOUNTING POLICIES

1. NATURE OF OPERATIONS

DCW Limited [“Parent Company”], a public limited company, together with its subsidiary, operates as an integrated ChemicalManufacturing organization.

The Parent Company’s shares are listed for trading on the National Stock Exchange and the Bombay Stock Exchange in India andits Global Depository Receipts [covering equity shares of Parent Company] are listed on the Luxembourg Stock Exchange.

2. BASIS OF PRESENTATION

ThenancialstatementshavebeenpreparedtocomplywiththeAccountingStandardsreferredtointheCompanies(AccountingStandards)Rule2006issuedbytheCentralGovernmentinexerciseofthepowerconferredundersubsection[I](a)ofSection642andtherelevantprovisionsoftheCompaniesAct,1956[the‘Act’].Thenancialstatementshavebeenpreparedunderthehistorical

cost convention on accrual basis. The accounting policies have been consistently applied by the Group unless otherwise stated.3. PRINCIPLES OF CONSOLIDATION

TheconsolidatednancialstatementsincludethenancialstatementsoftheParentCompanyanditssubsidiary,DCWPigmentsLtd., incorporated in India with effective group shareholding of 99%.

Theconsolidatednancialstatementshavebeencombinedonaline-by-linebasisbyaddingthebookvaluesoflikeitemsofassets,liabilities,incomeandexpensesaftereliminatingintra-groupbalances/transactionsandun-realisedprotsinfull.Theamountsshown in respect of reserves comprise the amount of the relevant reserves as per the balance sheet of the Parent Company andits share in the reserves of the consolidated entities.

Theconsolidatednancialstatementsarepresented,totheextentpossible,inthesameformatasthatadoptedbytheParentCompanyforitsseparatenancialstatements.

4. SYSTEMOFACCOUNTING

(A) TheCompanyfollowsthemercantilesystemofaccountingandrecognisesincomeandexpenditureonaccrualbasis.

(B) Financialstatementsarepreparedonhistoricalcostbasisandasagoingconcern,adjustedforrevaluation/dimunitioninvalueofcertainxedassets.

5. USE OF ESTIMATES

Thepreparationofnancialstatementsrequiresmanagementtomakecertainestimatesandassumptionsthataffecttheamountsreportedinthenancialstatementsandnotesthereto.Differencesbetweenactualresultsandestimatesarerecognizedintheperiod in which they materialize.

6. FIXED ASSETS AND DEPRECIATION

(A) FixedAssets

FixedAssetsarestatedattheiroriginalcostnetofCenvatCreditwhereapplicable(includingexpensesrelatedtoacquisition

andinstallation)exceptcertainFixedAssetswhichareadjustedforrevaluation. (B) DepreciationandAmortisation

Depreciation is charged in the Accounts on straight line method as under:

(a) OnassetsrevaluedatSahupuramUniton31-3-93@3%ontherevaluedcostbasedonrevisioninusefullifeestimatedbythevaluer(ReferNoteB2).

(b) OnxedassetsaddedpursuanttotheamalgamationofPantapeMagneticsLimitedwiththeCompany,atratesspeciedin Schedule XIV to the Companies Act, 1956 on the revalued cost.

(c) OnbalancexedassetsofthecompanyatratesspeciedinScheduleXIVtotheCompaniesAct,1956ontheoriginalcost.

(d) On xed assetsadded/disposedof during theyear,onpro-ratabasiswithreferencetothemonthof addition/ disposal.




Schedules


LIMITED

(e) OnTechnicalKnow-howfeesat33.33%.

7. REVENUE RECOGNITION

Revenueisrecognizedtotheextentthatitcanbereliablymeasuredandisprobablethattheeconomicbenetwillfollowtothe

Company. (a) Sales:Revenuefromsaleofgoodsisrecognizedwhensignicantrisksandrewardsofownershipofthegoodsaretransferred

to the customer and is stated net of trade discounts, excise duty, sales returns and sales tax.

(b) Interest:Revenueisrecognizedontimeproportionbasistakingintoaccounttheoutstandingamountandtheapplicablerateof interest.

(c) Dividends:Revenueisrecognizedwhentherighttoreceivepaymentisestablished.

8. EXPENDITURE DURING CONSTRUCTION AND ON NEW PROJECTS

Inthecaseofnewprojectsandinthecaseofmodernisation/expansionofexistingunits,interestonborrowingsforthesameandall pre-operative expenditure, incurred during implementation upto the date of installation are included under Capital Work inProgress and capitalised by adding pro-rata to the cost of the assets.

9. INVESTMENTS

The Company’s investments comprise long term and current investments. Long Term investments are stated at cost less permanentdimunition, if any, in value. Current investments are stated at lower of cost or market value.

10. INVENTORIES

Inventories are valued at lower of cost and net realisable value except stores, spares and stock in process which are valued atcost, packing materials which are valued at or below cost and scrap and by products which are valued at net realisable value.Cost is computed on weighted average basis and includes cost of conversion and other costs incurred in bringing the inventoriesto their present location and condition.

11. ACCOUNTING FOR CENVAT AND SERVICE TAX CREDITS

Cenvat credit available on Raw Materials, Fuel and Packing materials, stores, spares and Capital goods and Service tax crediton services availed are accounted for by reducing purchase cost of the related material or the expenses respectively and CenvatCreditavailableonxedassetsisaccountedbyreducingthesamefromthecostofrespectivexedassets.

12. FOREIGN CURRENCY TRANSACTIONS

(a) TransactionsinForeignCurrencyarerecordedattheexchangeratesprevailingonthedateofTransactions.

(b) Monetaryitemsdenominatedinforeigncurrencies(suchascashreceivables,payables,etc.)outstandingattheyearend,are translated at exchange rate applicable as of that date.

(c) Non-monetaryitemsdenominatedinforeigncurrency(suchasinvestments,xedassets,etc)arevaluedattheexchangerate prevailing on the date of transaction.

(d) AnygainsorlossesarisingduetoexchangedifferencesatthetimeoftranslationorsettlementareaccountedintheProt&Loss Account.

(e) Premium/discountsonforwardexchangecontractsareamortisedoverthelifeofthecontractandrecognisedintheProtandLossaccount,exchangedifferencesonsuchcontractsarerecognizedintheprotandlossaccountinthereportingperiodin which the exchange rates change.

13. RESEARCH&DEVELOPMENTEXPENDITURE

RevenueExpenditureonResearch&Developmentis chargedagainst theProtof the year inwhich itis incurred.CapitalexpenditureonResearch&Developmentisshownasanadditiontoxedassets.

14. BORROWINGCOSTS

Borrowing costs attributable to acquisition, construction or production of a qualifying asset are capitalized as part of the cost of that




Schedules


LIMITED

asset. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. All other borrowingcosts are recognized as an expense in the period in which they are incurred.

15. EMPLOYEE BENEFITS

(a) ContributionstoProvidentandSuperannuationFundsaremadetorecognisedfundsandarechargedtoProt&LossAccount.The interest rate payable by recognized Provident Fund shall not be lower than the statutory rate of interest declared byCentral Government and shortfall, if any, shall be made good by the Company.

(b) ThecompanyhascreatedanEmployees’GroupGratuityFundwhichhastakenaGroupGratuityAssuranceSchemewiththe Life Insurance Corporation of India. Premium charged by the Life Insurance Corporation of India, based on actuarialvaluationisdebitedtotheProtandLossaccount.

(c) LiabilitiestowardsLeaveEncashmentBenetisprovidedforbasedonactuarialvaluationdoneattheyearend.

(d) ContributiontoEmployeePensionScheme1995areaccountedonaccrualbasiswithcorrespondingremittancemadetoGovernment Provident Fund authority.

16. PROVISIONS&CONTINGENCIES

(A) Aprovisionarisingoutofapresentobligationisrecognizedwhenitisprobablethatanoutowofresourceswillberequiredto settle the obligation and the amount can be reasonably estimated.

(B) Whereverthereisapossibleobligationthatmay,butprobablywillnotrequireanoutowofresources,thesameisdisclosedby way of contingent liability.

(C) ShowCauseNoticesarenotconsideredasContingentLiabilitiesunlessconvertedintodemand.

17. TAXES ON INCOME

Income tax expenses comprises current tax and deferred tax charge or credit. Deferred tax assets/liabilities are measured byapplying tax rate and tax laws that have been enacted or substantially enacted by the Balance Sheet date. Deferred tax asset arisingon account of unabsorbed depreciation under tax laws is recognised only to the extent there is virtual certainty of its realisationsupported by convincing evidence. Deferred tax assets on account of other timing differences are recognised only to the extentthere is reasonable certainty of its realisation. At each Balance Sheet date, the carrying amount of Deferred Tax Asset is reviewed

based on developments to reassess realisation.

18. IMPAIRMENT OF ASSET

The carrying amount of assets are reviewed at each balance sheet date for indication of any impairment based on internal/externalfactors. An impairment loss is recognized wherever the carrying amount of the assets exceeds its recoverable amount. Any suchimpairmentlossisrecognizedbychargingittotheprotandlossaccount.Apreviouslyrecognizedimpairmentlossisreversedwhere it no longer exists and the asset is restated to that effect.

NOTES FORMING PART OF ACCOUNTS

AS PER STANDALONE ACCOUNTS OF DCW LIMITED.

Sincethisistherstyearofpreparationofconsolidatednancialstatementspreviousyeargureshavenotbeengiven.


For V. Sankar Aiyar & Co. Dr. Shashi Chand JainChartered Accountants Chairman&ManagingDirector



Place : Mumbai Chital V. Shah T. M. BhandariDate : 16th May, 2008 Asstt. Company Secretary Sr.VicePresident(Finance)

Dr. V. H. Joshi


Sushil Kumar Jalan

R. V. Ruia





LIMITED Schedules

FORMING PART OF CONSOLIDATED FINANCIAL STATEMENTS

For the year ended

31/03/2008Rs. in lacs

SCHEDULE “1”SALES (less Rebates and Trade Discount but

including excise duty)

Direct Sale * 46,904.86

Consignment Sales 30,118.40

Export Sales 9,116.76

Other Sales * 224.94

Sale of Services (TDS Rs. Nil Previous year Rs. 69.75 lacs)

TOTAL 86,364.96

* Includes Sale of Traded Goods Rs. 9.01 (Previous Year Rs. 33.75 lacs)

SCHEDULE “2”OTHER INCOMEProt on Sale of Investments 1.12

Prot on Sale of Fixed Assets 6.96

Unclaimed balance written back 40.45

Dividend received on current Investments 35.84

Dividend received on Long Term Investments 0.99

Bad Debts Recovered 0.34

Gain on Foreign Exchange Transactions (Net) 568.34

Miscellaneous Income 606.71

TOTAL 1,260.75

SCHEDULE “3”MANUFACTURING AND OTHER EXPENSES1. Consumption of Materials : Raw Materials

Stock in hand and in process as at opening 2,896.36Add : Purchases 41,711.60Less : Closing stock in hand & in process (including taxes duties etc.) 2,485.58

TOTAL 42,122.38

2. (a) INCREASE/DECREASE IN STOCKClosing Stock :Manufactured Products 3,632.96Stock in process 87.79Packing Drums and Scrap 269.89Coke Dust & Gypsum 40.29

Stock of Traded Shares 8.584,039.51

Opening Stock :Manufactured Products 1,619.03

Stock in process 58.09Packing Drums and Scrap 35.77Coke Dust & Gypsum 54.16Stock of Traded Shares 8.25

1,775.30

Opening Stock - Closing Stock (2,264.21)




LIMITEDSchedules


For the year ended

31/03/2008Rs. in lacs

SCHEDULE “3” (Contd.)(b) Increase/Decrease Excise Duty in Finished Goods Stock

Closing Stock Excise Duty (502.97)Opening Stock in Excise Duty 168.00

(334.97)(c) Purchases for resale (Net of stock of traded goods capitalised/written off) 9.26

TOTAL (2,589.92)

3. SALARIES, WAGES & BENEFITS TO EMPLOYEES

Salaries Wages 3,473.89

Contribution to Provident and other Funds 429.72

Employees’ Welfare 353.71

TOTAL 4,257.32

4. Power and Fuel 13,400.19

5. OPERATION AND MAINTENANCE

Repairs and Maintenance - Buildings 373.48

Repairs and Maintenance - Plant & Machinery 2,117.81

Repairs and Maintenance - Other Assets 195.78

Packing Charges 1,812.78

Other Operation & Maintenance Expenses 1,260.73

5,760.58

6. ASSETS SOLD OR WRITTEN OFF

Fixed Assets discarded, obsolete, written off 309.13Less : Drawn from Revaluation Reserve (284.15)

24.98

Loss on Sale of Fixed Assets 31.81

(Unserviceble etc. written off)

56.79

7. ADMINISTRATION EXPENSES

Rent 25.59Rates, Taxes and licence fees 63.65Insurance 182.02Wealth tax paid 1.30

Donation 1.15Other expenses 812.80

1,086.51

8. SELLING AND DISTRIBUTIONFreight, Transportation, Loading and Other 1,593.75Charges (Net)Commission to wholesalers/others 446.86Cash discount 58.58Octroi - Consignment Sale 7.13

2,106.32




LIMITED

For the year ended

31/03/2008Rs. in lacs

9. (a) PAYMENT TO AUDITORS

(i) Audit Fees 5.00(ii) Tax Audit 1.25(iii) Retainer fees 3.60(iv) Other Services 1.96(v) Reimbursement of Expenses 3.17

14.98

(b) Details of Directors’ Remuneration under Section 198(i) Managing Director’s and Whole time Directors’ Remuneration :

Salary 96.00Perquisites on House 9.60Gas, Electricity expenses 10.64Company’s Contribution to PF 8.64

Leave Travel Concession 4.93Medical Expenses 10.82Company’s Contribution to Superannuation 10.80Commission 283.68

(ii) Directors Sitting Fees 2.13437.24

Less : Amount Capitalised 39.48397.76

TOTAL 66,612.91

SCHEDULE “4”INTEREST AND FINANCE CHARGES

Fixed loans 899.98

Others 557.031,457.01

Less : Interest from banks & others (TDS Rs. 22.10 lacs) (Previous Year Rs. NIL) (108.67)

TOTAL 1,348.34

SCHEDULE “5”DEPRECIATION

Depreciation on Fixed Assets for the year 3,026.553,026.55

Less : Drawn from Revaluation Reserve 23.70

TOTAL 3,002.85

Schedules







Dr. V. H. Joshi


Sushil Kumar Jalan

R. V. Ruia




SAhupuRAm FAcIlItY‘50 years of excellence and innovation’

The Sahupuram Chemical Complex was commissioned in 1959 as a Chlor-alkali plant in one of themost remote corners of India in the Tuticorin District of Tamilnadu. Over the years, the Companyhas expanded this facility by setting-up, a Liquid Chlorine plant, India’s first Trichloroethyleneplant, first of its kind Beneficiated Ilmenite facility in the world, a PVC Resin plant, India’s firstVCM storage facility and a Captive Power Plant. Recently a new Greenfield Caustic Soda unit wascommissioned with the latest membrane technology resulting in substantial expansion in capacity.A new 50 MW Thermal Cogeneration Captive Power Plant is currently under the process of being commissioned. This has not only made DCW one of the pioneers in the Chemical Industryin India but has also facilitated the District’s industrial growth. Today, Tuticorin port is the fourth

busiest port in India and the region is attracting considerable Industrial activity. This year willmark the 50th Anniversary of the plant which truly has been the backbone of DCW and hasplayed a pivotal role in the success of the Company over the years.

Now

Ten



Documents

DCW Ltd. - Annual Report - 2007-2008