apar janta annual report 2009-10 - bombay stock exchangeannual report 2009-10 3 notice is hereby...

Annual Report 2009-10

“Tomorrow'sProgress Today”

Years52

If undelivered, please return to:APAR INDUSTRIES LTD.

301, Panorama Complex, R. C. Dutt RoadVadodara - 390007

www.apar.com

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Forward-looking statementIn this Annual Report we have disclosed forward-looking information to enable investors to comprehend ourprospects and take informed investment decisions. This report and other statements - written and oral - that weperiodically make contain forward-looking statements that set out anticipated results based on the management’splans and assumptions. We have tried wherever possible to identify such statements by using words such as‘anticipate’, ‘estimate’, ‘expects’, ‘projects’, ‘intends’, ‘plans’, ‘believes’, and words of similar substance inconnection with any discussion of future performance.We cannot guarantee that these forward-looking statements will be realised, although we believe we have beenprudent in assumptions. The achievement of results is subject to risks, uncertainties and even inaccurateassumptions. Should known or unknown risks or uncertainties materialise, or should underlying assumptions proveinaccurate, actual results could vary materially from those anticipated, estimated or projected. Readers should bearthis in mind.We undertake no obligation to publicly update any forward-looking statements, whether as a result of newinformation, future events or otherwise.

Registered Office: 301, Panorama Complex, R. C. Dutt Road, Vadodara – 390 007.

ATTENDANCE SLIPPlease complete the Attendance Slip and hand it over at the entrance of the Meeting place. Joint Shareholders may obtain additionalAttendance Slips on request.Name & Address of the Member/s_______________________________________________________________________________________________________________________________________________________________________________________________________Ledger Folio No. (s)_____________________________DP ID No.* _________________________& Client ID No. *____________________No. of Shares held _________________________________________________________________________________________________* Applicable for members holding shares in electronic form.I hereby record my presence at the 21st Annual General Meeting to be held on Monday, 2nd August, 2010 at 2.30 P.M. at theAuditorium of Vanijya Bhavan, Central Gujarat Chamber of Commerce, Race Course Circle, Vadodara – 390 007.

Signature of the Member/Proxy

ContentsCorporate Information 01 Financial Highlights for last five years (Consolidated) 02 Notice 03Directors’ Report 09 Corporate Governance Report 19 Auditors’ Report 30 Balance Sheet 34 Profit and Loss Account 35 Schedules 36 Balance Sheet Abstract 60 Cash Flow Statement 61Section 212 Statement 62 Consolidated Accounts 63

Registered Office: 301, Panorama Complex, R. C. Dutt Road, Vadodara – 390 007.PROXY FORM

Ledger Folio No. (s) _______________________ DP ID No. * _______________________& Client ID No. * _______________________No. of Shares held _________________________________________________________________________________________________I/we __________________________________________________________ of _________________________________________________being a Member / Members of Apar Industries Limited hereby appoint _____________________________________________________of ______________________________________________ or failing him/her _________________________________________________of _________________________________________________ as my / our proxy to attend and vote for me / us and on my / our behalfat the 21st Annual General Meeting of the Equity Shareholders of the Company to be held on Monday, 2nd August, 2010 at 2.30 P.M. at the Auditorium of Vanijya Bhavan, Central Gujarat Chamber of Commerce, Race Course Circle, Vadodara – 390 007,and at any adjournment thereof.Signed this ___________________________day of ____________________________2010 by the said ___________________________* Applicable for members holding shares in electronic form.

Note : This Proxy Form must be deposited at the Registered Office of the Company not later than 48 hours before the time for holdingthe meeting. The Proxy need not be a Shareholder of the Company.

Affix a Re. 1 Revenue StamphereSignature(s) of Member(s)

BOARD OF DIRECTORSDr. N. D. Desai Chairman Mr. V. A. Gore Upto December 1, 2009Dr. N. K. ThingalayaMr. F. B. ViraniMr. Kushal N. Desai Managing DirectorMr. C. N. Desai Joint Managing DirectorMr. H. N. ShahMr. Gary Ng Jit Meng Upto January 21, 2010AUDIT COMMITTEEMr. V. A. Gore Chairman(Upto December 1, 2009)Mr. H. N. Shah Member - w.e.f. January 21, 2010

Chairman - w.e.f. May 25, 2010Dr. N. K. ThingalayaMr. F. B. ViraniMr. Gary Ng Jit Meng Upto January 21, 2010COMPANY SECRETARYMr. Sanjaya KunderAUDITORSM /s. Price WaterhouseChartered Accountants, MumbaiBANKERS

Union Bank of India Syndicate Bank ING-Vysya Bank Ltd.IDBI Bank Limited ICICI Bank Ltd. State Bank of IndiaStandard Chartered Bank Yes Bank Ltd. Bank of BarodaAxis Bank Ltd.

REGISTERED OFFICE CORPORATE OFFICE301, Panorama Complex, Apar House, Corporate Park R.C. Dutt Road Sion – Trombay Road, Chembur,Vadodara – 390 007 Mumbai – 400 071.Tel: (++91) (265) 2339906, 2331935 Tel: (++91) (22) 25263400, 67800400Fax: (++91) (265) 2330309 Fax: (++91) (22) 2524 6326e-mail: [email protected] e-mail: [email protected]: www.apar.com Website: www.apar.comREGISTRAR & SHARE TRANSFER AGENTMCS LimitedNeelam Apartment, 88, Sampatrao Colony,B/H Standard Chartered Bank,Alkapuri, Vadodara – 390 007.Tel: (++91) (265) 2339397, 2350490Fax: (++91) (265) 2341639e-mail: [email protected]

Corporate Information

3Annual Report 2009-10

NOTICE is hereby given that the TWENTY FIRST Annual GeneralMeeting of the Equity Shareholders of APAR INDUSTRIESLIMITED will be held at the Auditorium of the Vanijya Bhavan,Central Gujarat Chamber of Commerce, Race Course Circle,Vadodara – 390 007 on Monday, the 2nd August, 2010 at 2.30P.M. to transact the following business : Ordinary Business: 1. To receive, consider and adopt Balance Sheet as at March

31, 2010 and Profit and Loss Account for the year endedon that date together with Reports of Directors andAuditors thereon.

2. To declare dividend on Equity Shares of the Company.3. To appoint a Director in place of Shri C. N. Desai, who retires

by rotation and being eligible, offers himself for re-appointment.

4. To appoint a Director in place of Dr. N. K. Thingalaya, whoretires by rotation and being eligible, offers himself for re-appointment.

5. To appoint Auditors of the Company and to fix theirremuneration.

Special Business:6. To consider and, if thought fit, to pass with or without

modification(s), the following resolution as a SpecialResolution :-“RESOLVED THAT pursuant to the provisions of Section81(1A) and other applicable provisions, if any, of theCompanies Act, 1956, the provisions of Securities andExchange Board of India (Issue Of Capital And DisclosureRequirements) Regulations, 2009 (the “SEBI ICDRRegulations”), the provisions of the Foreign ExchangeManagement Act, 1999, and rules and regulations madehereunder, including the Foreign Exchange Management(Transfer and Issue of Securities by a person Resident outsideIndia) Regulation, 2000, if applicable, the provisions of Issueof Foreign Currency Convertible Bonds and Ordinary Shares(Through Depository Receipt Mechanism) Scheme, 1993 andsubject to any other applicable law or laws, rules andregulations (including any amendment thereto or re-enactment thereto or re-enactment thereof for the timebeing in force) and subject to enabling provisions in theMemorandum and Articles of Association of the Company

and Listing Agreements, entered into by the Company withthe Stock Exchanges where the shares of the company arelisted and subject to any approval, consent, permission and/ or sanction of the members of the Company by way ofSpecial Resolution, if any, Government of India (GOI),Reserve Bank of India (RBI), Stock Exchanges, Registrar ofCompanies, Securities and Exchange Board of India (SEBI)and / or any other competent authorities, institutions orbodies, within or outside India, and subject to suchconditions and modifications as may be prescribed by any ofthem while granting such approvals, permissions, consentsand sanctions and which may be agreed by the Board ofDirectors (hereinafter referred to as “Board” which term shallinclude any committee thereof, whether constituted or tobe constituted), approval of the Company be and is herebyaccorded to the Board to create, offer, issue and allot in oneor more tranch(es), in the course of domestic and / orinternational offerings and /or Qualified InstitutionalPlacements (“QIP”), with or without an over allotment /green shoe issue option, in one or more foreign markets ordomestic markets, to domestic institutions, foreigninstitutions, non-resident Indians, Indian public, companies,corporate bodies, mutual funds, banks, insurancecompanies, pension funds, individuals, qualified institutionalbuyers or other persons or entities, whether shareholders ofthe Company or not, through a public issue and / or on aprivate placement basis and / or qualified institutionalplacement within the meaning of Chapter VIII of the SEBIICDR Regulations and /or preferential issue and / or otherkind of public issue and /or private placement or through acombination of the foregoing as may be permitted underapplicable law from time to time, with or without an overallotment/ green shoe option, such number of equity shares,secured or unsecured debentures, bonds or any othersecurities whether convertible into equity share or not,including, but not limited to, Foreign Currency ConvertibleBonds (“FCCBs”), Optionally Convertible Debentures(“OCD”), Bonds with share warrant attached, GlobalDepositary Receipts (“GDRs”), American Depositary Receipts(“ADRs”) or any other equity related instrument of theCompany or a combination of the foregoing including butnot limited to a combination of equity shares with bondsand / or any other securities whether convertible into equityshares or not (hereinafter referred to as “securities”) for a

2 Apar Industries Limited

NoticeFinancial Highlightsfor last five years (Consolidated)

(Rupees in million)Particulars 2009-10 2008-09 2007-08 2006-07 2005-06PROFIT AND LOSS ACCOUNT DATASales (Net of Excise) 22,355 26,371 17,658 15,114 11,124 % of Growth (15) 49 17 36 27 Exports 6,236 7,899 6,874 3,157 1,956 Materials, Operating and other costs 20,901 25,717 16,467 14,047 10,507 Employee cost 321 256 185 159 154 Depreciation 185 147 140 100 86 Interest and Discounting charges 332 412 371 324 209 Profit before tax, exceptional & Extraordinary Items 1,016 5 739 686 546 % of Growth 19,083 (99) 8 26 52 Taxation 224 23 118 167 110Profit after Tax (PAT) 792 (18) 621 519 436 Exceptional items 12 17 38 38 17 Extraordinary Items - net of tax 603 – (323) – –Associate profit/(loss) – (58) (13) – –Minority interest 67 40 (4) 1 –Balance of Profit 244 (53) 889 482 419 % of Growth (106) 84 15 33 BALANCE SHEET DATAShare Capital 323 323 323 323 846 Reserves & Surplus 2,511 2,476 2,521 1,844 992 Net worth 2,834 2,799 2,844 2,167 1,838 Minority interest 3 79 6 – –Loan Funds 1,617 1,615 1,009 1,328 1,056 Defferred Tax (Net) 72 63 54 139 136 Total Liabilities 4,526 4,556 3,913 3,634 3,030Gross Block 3,091 2,794 1,469 2,234 1,880 Net Block 1,811 1,793 1,107 1,604 1,149 Investments including Goodwill on Consolidation 0 603 374 3 4 Net Current assets 2,715 2,148 2,403 1,984 1,825 Miscellaneous Expenditure – 12 29 43 52(to the extent not written off or adjusted) Total Assets 4,526 4,556 3,913 3,634 3,030KEY RATIOSPAT to Sales (%) 1.09 (0.20) 5.03 3.19 3.76 Return on Net Worth (%) 30.57 (1.28) 37.53 26.61 32.90 Asset Turns (Revenue to total Assets) 4.96 6.27 4.74 4.61 4.08 Return on Capital Employed (%) * 24.65 5.94 24.49 23.30 22.03 Debt to Equity Ratio 0.36 0.41 0.07 0.29 0.33 Earning per Equity Share (Basic) Rs. 7.56 (1.65) 27.48 15.42 13.93 Rate of dividend % p.a. 50% – 55% 35% 35% Book value per Equity Share Rs. 87.63 86.22 87.08 65.68 55.22 Share Price as on March 31, 2010 (BSE) 197.50 78.05 205.70 139.20 245.90 * excluding extra-ordinary items


e) Finalization of, signing of and arrangement for thesubmission of the preliminary and final offering circulars /prospectus(es) / offer document(s), and any amendmentsand supplements thereto, along with supporting papersneeded to be filed for seeking listing approval with anyapplicable government and regulatory authorities,institutions or bodies as may be required;

f) Deciding the pricing and terms of the securities, and all otherrelated matters, including taking any action on two-wayfungibility for conversion of underlying equity shares intoFCCBs/ GDRs/ ADRs, as per applicable laws, regulations orguidelines;

g) Appoint, in its absolute discretion, managers (including lead manager), Investment Bankers, Merchant Bankers,underwriters, guarantors, financial and /or legal advisors,depositories, custodians, principal paying/transfer/conversion agents, listing agents, registrars, trustees and allother agencies, whether in India or abroad, entering into orexecution of all such agreements/ arrangements/ MoUs/documents with any such agencies, in connection with theproposed offering of the securities;

h) Approval of the Deposit Agreements(s), the Purchase/Underwriting Agreement(s), the Trust Deed(s), theIndenture(s), the Master/ Global GDRs / ADRs / FCCBS / othersecurities, letters of allotment, listing application,engagement letter(s), memorandum of understanding andany other agreements of documents, as may be necessary inconnection with the issue / offering (including amending,varying or modifying the same, as may be considereddesirable or expedient), in accordance with all applicablelaws, rules, regulations and guidelines;

i) Settle all questions, difficulties or doubts that may arise inregards to the issue, offer or allotment of securities andutilization of the proceeds of the issue in such manner andto do all such acts, deeds, matters and things as it may in itsabsolute discretion deem fit.RESOLVED FURTHER THAT the Board and/or theCommittee authorised by the Board be and is herebyauthorised to accept any modifications in the proposals asmay be required by the authorities involved in such issuesbut subject to such conditions as the SEBI/GoI/RBI or suchother appropriate authorities may impose at the time of theirapproval and as agreed to by the Board;RESOLVED FURTHER THAT without prejudice to thegenerality of the foregoing, issue of the securities may bedone upon all or any terms or combination of terms inaccordance with international practices relating to thepayment of interest, additional interest, premium onredemption, prepayment or any other debt service paymentsand all such terms as are provided customarily in an issue ofsecurities of this nature.RESOLVED FURTHER THAT the Company may enter intoany arrangement with any agency or body authorised by theCompany for the issue of depositary receipts representingthe underlying equity shares issued by the Company inregistered or bearer form with such features and attributesas are prevalent in international capital markets forinstruments of this nature and to provide for the tradabilityof free transferability thereof as per international practicesand regulations (including listing on one or more stockexchange(s) inside or outside India) and under the forms andpractices prevalent in the international markets.”

Registered Office : By Order of the Board,301, Panorama Complex, R. C. Dutt Road,Vadodara 390 007.

Place : Mumbai Sanjaya KunderDate : 25th May, 2010 Company Secretary


value of upto Rs. 125 Crores (Rupees One Hundred TwentyFive Crores only), whether to be listed on any stock exchangeinside India or any international stock exchanges outsideIndia, through an offer document and / or prospectus and /or offer letter, and / or offering circular, and / or on publicand / or private or preferential basis, whether rupeedenominated in foreign currency at such time or times, atsuch price or prices in such manner and on such terms andconditions including security, rate of interest etc, as may bedecided by and deemed appropriate by the board as perapplicable law, including the discretion to determine thecategories of Investors to whom the offer, issue andallotment shall be made, considering, the prevailing marketconditions and other relevant factors wherever necessary inconsultation with its advisors, as the board in its absolutediscretion may deem fit and appropriate.RESOLVED FURTHER THAT in addition to all applicableIndian laws, the securities issued in pursuance of thisresolution shall also be governed by all applicable laws andregulations of any jurisdiction outside India where they arelisted or that may in any other manner apply to suchsecurities or provided in the terms of their issue.RESOLVED FURTHER THAT any securities that are notsubscribed in issues mentioned above, may be disposed offby the board in its absolute discretion in such manner, asthe board may deem fit and as permissible by the law.RESOLVED FURTHER THAT in case of a QualifiedInstitutional Placement pursuant to Chapter VIII of the SEBIICDR Regulations, the allotment of specified securities shallonly be to Qualified Institutional Buyers within the meaningof Chapter VIII and the relevant date for the determinationof the price of the equity shares to be issued or issuedpursuant to conversion, shall be the date on which theboard decides to open the issue of securities or such othertime as may be allowed by SEBI ICDR Regulations from timeto time and allotment of specified securities shall becompleted within twelve months from the date of thisresolution.RESOLVED FURTHER THAT in case of an issuance of FCCBs/ ADRs / GDRs, the relevant date for the determination ofthe issue price of the securities offered, shall be determinedin accordance with the Issue of Foreign Currency ConvertibleBonds and Ordinary Shares (through Depository ReceiptMechanism) Scheme, 1993 as may be amended from timeto time.

RESOLVED FURTHER THAT the issue of Securities shall besubject to the following terms and conditions:

a) The Securities shall be subject to the provisions ofMemorandum and Articles of Association of the Companyand in accordance with the terms of the issue; and

b) The number and / or price of the Securities shall beappropriately adjusted for corporate actions such as bonusissue, rights issue, stock split, merger, demerger, transfer ofundertaking, sale of division or any such capital or corporaterestructuring.RESOLVED FURTHER THAT for the purpose of giving effectto the above resolutions, the Board be and is herebyauthorised to do all such acts, deeds, matters and thingsincluding but not limited to determining the form andmanner of the issue, including the class of investors towhom the Securities are to be issued and allotted, numberof Securities to be allotted, execution of various transactiondocuments, creation of mortgage/ charge in accordancewith Section 293(1)(a) of the Act, in respect of any Securitiesas may be required either on pari-passu basis or otherwise,as it may in its absolute discretion deem fit and to settle allquestions, difficulties or doubts that may arise in regard tothe issue, offer or allotment of Securities and utilization ofthe issue proceeds as it may in its absolute discretion deemfit without being required to seek any further consent orapproval of the members or otherwise to the end and intentthat the members shall be deemed to have given theirapproval thereto expressly by the authority of this resolution.RESOLVED FURTHER THAT the Board be and is herebyauthorised to form a committee or delegate all or any of itspowers to any Directors (s) or Committee of Directors /Company Secretary / other persons authorised by the Boardto give effect to the aforesaid resolutions.RESOLVED FURTHER THAT subject to the applicable laws,the Board and / or the Committee authorised by the Boardbe and is herby authorised to do such acts, deeds and thingsas the Board in its absolute discretion deems necessary ordesirable in connection with the issue of the securities,including, without limitation of the following;

a) Decide the date for the opening of the issue of securitiesb) Decide the price band for the issuec) Finalization of the Issue Priced) Finalization of the allotment of the securities on the basis of

the subscriptions received.


Item No. 6 :The Company proposes to raise funds to the tune of Rs. 125Crores (Rupees One Hundred Twenty Five Crores only) in one ormore tranches through a public issue and / or on a privateplacement basis and/or QIP within the meaning of Chapter VIIIof the SEBI ICDR Regulations and/or preferential issue and/or anyother kind of public issue and/or private placement as may bepermitted under applicable law from time to time. The resolutioncontained in the business of the Notice is regarding proposal tocreate, offer, issue and allot equity shares and/or such otherSecurities as stated in the Special Resolution (the “Securities”)which seeks to empower the Board of Directors (hereinafterreferred to as “Board” which include any Committee thereof,whether constituted or to be constituted) to undertake such issueor offer of securities.1. Object of the issue :In order to meet the funds requirement and to strengthen thefinancial position and capital base of the Company byaugmenting its long-term resources,2. Pricing :In case of an issue of the Securities to Qualified InstitutionalBuyers pursuant to Chapter VIII of the SEBI ICDR Regulations, theissue price of Securities shall be at a price, being not less than theprice calculated in accordance with Chapter VIII of SEBI ICDRRegulations as may be amended from time to time and theRelevant Date in this regard shall be the date on which the boarddecides to open the issue of securities or such other time as maybe allowed by SEBI ICDR Regulations from time to time.In case of a Qualified Institutional Placement pursuant to ChapterVIII of the SEBI ICDR Regulations, the allotment of securities shallbe completed within twelve months from the date of passing ofthis resolution.In case of issue of ADRs / GDRs the issue price shall be at a price,being not less than the price calculated in accordance withapplicable law including the Issue of Foreign CurrencyConvertible Bonds and Ordinary Shares (Through DepositoryReceipts Mechanism) Scheme, 1993, as may be amended fromtime to time.3. Terms and Conditions :The detailed terms and conditions for the offer will be

determined by the Board in consultation with Advisors, LeadManager / Book Runners, Underwriters and such other authorityor authorities as may be required to be consulted by theCompany considering the prevailing market conditions and otherrelevant factors.The issue/ allotment/ conversion would be subject to theavailability of regulatory approvals, if any. The conversion ofsecurities, held by foreign investors, into shares would be subjectto the applicable foreign investment limits.The Special Resolution seeks to empower the Board and/orCommittee authorised by the Board, to issue Securities in one ormore tranche or tranches, at such time / times, and to suchperson(s) as the Board may in its absolute discretion deem fit.Section 81(1A) of the Companies Act, 1956 and the relevantclause of the Listing Agreement with the Stock Exchanges wherethe Equity Shares of the Company are listed provides, inter alia,that when it is proposed to increase the issued capital of acompany by allotment of further shares, such further shares shallbe offered to the existing shareholders of such company in themanner laid down in Section 81 unless the shareholders in ageneral meeting decide otherwise. Since the Special Resolutionproposed in the business of the Notice results in the issue ofshares of the Company otherwise than to the members of theCompany, consent of the shareholders is being sought pursuantto the provisions of Section 81 (1A) and other applicableprovisions of the Companies Act, 1956 and the ListingAgreement.The Special Resolution, if passed, will have the effect of allowingthe Board and/or the Committee authorised by the Board to issueand allot Securities to the investors who may or may not be theexisting shareholders of the Company and the Board and/or theCommittee authorised by the Board will have the power todecide the date of opening of the Issue.The Directors of the Company may be deemed to be concernedor interested in the above resolution only to the extent of sharesheld by them in the Company.The Board of Directors recommend the Special Resolution foryour approval.

ANNEXURE TO NOTICEEXPLANATORY STATEMENT PURSUANT TO SECTION 173 (2) OF THE COMPANIES ACT, 1956.


NOTES :1. A MEMBER ENTITLED TO ATTEND AND VOTE IS ALSO

ENTITLED TO APPOINT A PROXY OR PROXIES TO ATTENDAND VOTE INSTEAD OF HIMSELF/HERSELF. SUCH PROXYNEED NOT BE A MEMBER. THE PROXY FORM DULYCOMPLETED AND SIGNED SHOULD REACH THECOMPANY’S REGISTERED OFFICE AT LEAST 48 HOURSBEFORE THE TIME APPOINTED FOR THE MEETING.

2. The Register of Members and Share Transfer Books for theEquity Shares of the Company shall remain closed fromMonday, July 26, 2010 to Monday, August 2, 2010, bothdays inclusive.

3. Members desirous of obtaining information / details aboutthe accounts, are requested to write to the Company at leastone week before the meeting, so that proper informationcan be made available at the time of meeting.

4. Shareholders who have not so far surrendered their oldshare certificates of Gujarat Apar Polymers Limited (GAPL)for exchange against the new share certificates of theCompany i.e. Apar Industries Limited (AIL) are once againrequested to forward their old share certificates to theCompany for exchange. The old share certificates of GAPLhave already been cancelled and are of no effect or value.

5. Members holding shares in dematerialised form, may pleasenote that while opening a depository account withDepository Participant (DP), they have given their bankaccount details, which will be printed on their dividendwarrants. However, if any member wants to change /correct the bank account details, he / she shouldcommunicate the same immediately to the concernedDepository Participant (DP). Members are also requested tofurnish the bank account details along with MICR code oftheir bank to their Depository Participant so as to enable theCompany to ensure payment of dividend through ElectronicClearing Service (ECS).

6. The details of Directors, seeking appointment / re-appointment at the ensuing Annual General Meeting asrequired in terms of Clause 49 of the Listing Agreement ofthe Stock Exchanges, are also annexed hereto and formingpart of the Notice.

7. Consequent upon the introduction of Section 205C by theCompanies (Amendment) Act, 1999, the amount ofdividend remaining unpaid or unclaimed for a period of

seven years from the date of its transfer to the unpaidDividend Account of the Company is required to betransferred to the Investor Education and Protection Fundset up by the Government of India and no payment shall bemade in respect of any such claims by the Fund.The unpaid / unclaimed Dividend amount of Equity Sharesof the Company paid on 16.10.2003 (6th Dividend for2002-03) and 24.11.2003 (Interim Dividend – 2003-04) aredue for transfer to the said fund in the month of October,2010 and November, 2010, respectively. Members whohave not yet encashed their warrant (s) are requested tomake their claims to the Company without any delay.

8(a)As stated in Para No. 7 (c) of the Directors’ Report, theCompany has received an approval under Section 212(8) ofthe Companies Act, 1956 from the Ministry of CorporateAffairs, Government of India vide its letter dated March 19,2010 exempting the Company from attaching the AnnualAccounts, Reports and other Statements pursuant to Section212(1) of the Act, in respect of – (a) Petroleum SpecialitiesPte. Ltd., Singapore (PSPL) and (b) Poweroil SpecialityProducts FZE, Sharjah, U.A.E., Wholly Owned Subsidiaries(WOS) of the Company; (c) Quantum Apar Speciality OilsPty. Ltd., Australia, Subsidiary of PSPL (d) Uniflex CablesLimited (UCL), a Subsidiary Company and (e) Marine Cables& Wires Private Limited, WOS of UCL with the Annual Reportof the Company for the financial year ended March 31,2010. Therefore, the accounts and reports of the saidsubsidiary Companies are not attached herewith.

(b) However, a Statement showing information in aggregate ofthe said subsidiary Companies in compliance with theaforesaid approval letter of Ministry of Corporate Affairs hasbeen attached with the consolidated financial statements.

(c) The Company shall provide a copy of the Annual Accountsand related information / reports for the year 2009-2010 ofthe subsidiary Companies as required under Section 212 ofthe Act to the shareholders on their request, free of cost, atany point of time. Further, the annual accounts of subsidiaryCompanies shall be available for inspection at the RegisteredOffice and Corporate Office of the Company and that of therespective subsidiary Company.

9. The required Explanatory Statement pursuant to Section 173(2) of the Companies Act, 1956 in respect of Special Businessis annexed hereto, forming part of the Notice.

Registered Office : By Order of the Board,301, Panorama Complex, R. C. Dutt Road,Vadodara 390 007.

Place : Mumbai Sanjaya KunderDate : 25th May, 2010 Company Secretary


ToThe Shareholders,Your Directors have pleasure in submitting the 21st Annual Report of the Company together with the audited annual accountsshowing the financial position of the Company for the year ended March 31, 2010. 1. Financial results Rs. in millions

* Consolidated results include the results of –(a) Petroleum Specialities Pte. Ltd, Singapore (PSPL) and Poweroil

Speciality Products FZE, Sharjah, wholly-owned subsidiaries (WOS)of the Company;

(b) Uniflex Cables Ltd (UCL), a subsidiary company

(c) Apar ChemateK Lubricants Ltd., a joint venture company(d) Marine Cables & Wires Private Limited, WOS of UCL (MCWPL) and(e) Quantum Apar Speciality Oils Pty. Ltd., subsidiary of PSPL # Non-cash loss on impairment of equity investment in UCL &

MCWPL (see para 3 (c) of this Report).


DETAILS OF DIRECTORS SEEKING APPOINTMENT / RE-APPOINTMENT AT THEENSUING ANNUAL GENERAL MEETING.

(Pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges)

Directors’ Report

Name of Director Shri C. N. Desai Dr. N. K. ThingalayaDate of Birth 15.07.1971 04.11.1937Date of Appointment 29.05.1993 27.07.2001Expertise in specific functional areas Chemical Engineering Banking Qualifications B.Sc. (Hons.), (Chem. Engg.),USA Ph. D. (Economics)

B.S. (Econ.) Hons., Wharton, USA.List of other Companies in which 1. Apar Masat Conductors Ltd. 1. Lamina Foundries Limited Directorship held as on 31.03.2010 2. Apar ChemateK Lubricants Ltd. 2. Uniflex Cables Limited

3. Apar Corporation Pvt. Ltd.4. Apar Technologies Pvt. Ltd.5. Scope Pvt. Ltd.6. Catalis World Pvt. Ltd.7. Uniflex Cables Ltd.8. Marine Cables & Wires Pvt. Ltd.9. Poweroil Speciality Products FZE,

Sharjah, UAEChairman / Member of the 1. Uniflex Cables Limited 1. Lamina Foundries Limited Committee of other Public - Remuneration Committee - Remuneration CommitteeCompanies on which he is a - Shareholders / Investors - Audit CommitteeDirector as on 31.03.2010. Grievance Committee

- Audit CommitteeNo. of Shares held in the Company 65,20,932 NilRelationship between Directors inter se Related to – Dr. N. D. Desai, (Father) Nil

and Shri K. N. Desai, (Brother)

Particulars Company Consolidated*2009-10 2008-09 2009-10 2008-09

Sales turnover 19,980.54 24,634.13 22,355.45 26,370.60(after deduction of excise duty amount of)Other income 166.39 63.23 160.00 62.26Profit for the year before interest, depreciation/amortisation, taxation and exceptional items 1,385.11 524.03 1,532.76 565.02Deducting there from:- Depreciation / amortization 118.79 109.93 185.13 147.15- Interest 195.60 312.49 331.99 412.50PROFIT BEFORE ADJUSTMENT OF EXCEPTIONAL ITEMS, TAXATION,SHARE OF ASSOCIATES' NET LOSS AND MINORITY INTEREST 1,070.72 101.61 1,015.64 5.37Exceptional items 22.61 17.40 11.56 17.40PROFIT BEFORE TAXATION FOR THE YEAR 1,048.11 84.21 1,004.08 (12.03)Deducting there from:- Provision for taxation 186.74 31.14 223.86 23.41Net profit for the year after taxation and before share of associates' net loss and minority interest 861.37 53.07 780.22 (35.44)Adjustment of:-loss of associate concern (prior to it becoming subsidiary) 0.00 0.00 0.00 57.89-Minority interest in subsidiary/joint venture (profit)/loss 67.21 40.11NET PROFIT AFTER TAXATION AND ABOVE ADJUSTMENTS. 861.37 53.07 847.43 (53.22)Extraordinary items – impairment loss on investments # 555.54 0.00 603.08 0.00Balance profit 305.83 53.07 244.35 (53.22)Add: Balance of profit brought forward from the previous year 998.17 945.10 980.32 1,033.54Amount available for appropriations 1,304.00 998.17 1,224.67 980.32Appropriations made by the Board of Directors:- General reserve 87.50 – 87.50 –- Dividends on equity shares:- Proposed dividend at Rs. 5 (50%) per share 161.68 – 161.68 –- Income tax on dividends 26.86 – 26.86 –- Leaving balance of profit carried to balance sheet 1,027.96 998.17 948.63 980.32Earnings per equity share (EPS)- Basic and diluted before extraordinary items 26.64 1.64 26.21 (1.65)- Basic and diluted after extraordinary items 9.46 1.64 7.56 (1.65)


(ii) Conductor divisionSales revenue in FY10 was down by 28.9% from Rs. 13,860.16million to Rs. 9,858.18 million on account of reduction involume by 16.3% from 89,715 MT to 75,075 MT.Segment level profit for the year was down by 38.4% from Rs. 975.98 million to Rs. 601.02 million. There were several factors that resulted in the above lowerperformances.– Second half FY10 had lower order execution as there were

delays/re-schedulement of several orders that had beenbooked. Some of this is attributable to delayed financialclosures (from FY09 crisis post September 2008) or projectdelays due to customer having right of way issues. However,the postponement of these orders execution will result in asubstantially higher volume in FY11.

– There were delays in both tenders and awarding contractsfrom power grid which resulted in these getting shifted intoFY11.

– After the 2008 financial crisis, the demand for conductorswas affected in the short term. It resulted in a verycompetitive environment, where the Company was out-priced in bidding for some contracts.

– However, the order book as of April 1, for FY11 is Rs.10,832.4 million in confirmed orders and Rs. 2,865 millionin the pipeline. We expect total volume to grow by about30% in FY11 over FY10 with a corresponding increase inprofitability for this segment. Approximately, 75% of theseorders (confirmed and pipeline) will be executed in FY11.

The Company followed a conservative hedging strategy both onforeign exchange and metal front. All fixed price contracts werehedged on a back to back basis. The mark to market losses(MTM) on such contracts as of March 31, 2010 in accordancewith announcement dated March 28, 2008, issued by theInstitute of Chartered Accountants of India, amounting to Rs. 400.03 million have not been provided in the accounts, asit is notional in nature and said loss would get extinguished onexecution of firm sale price orders corresponding to thesecommodity contracts. The MTM loss is largely due to a singlelarge export order which has delivery schedule that runs through

the end of calendar year 2011.Risk and concernsThere is continued volatility in the commodity markets. Eventhough, the Company hedges the metal on LME, there can bemark to market losses until completion of the Contract. Thereis also substantial volatility in the foreign exchange market whichcan lead to changes in the value addition, that the company hastargeted.(b) Qualified institutional / private placement In order to meet the funds requirement and to strengthen thefinancial position and capital base of the Company byaugmenting its long-term resources, the Company would needaccess to external funds at different points of time in the future.It is proposed to seek an enabling resolution of the members atthe ensuing Annual General Meeting (AGM) and for thepurpose, appropriate resolutions with explanatory statement areincorporated in the notice of AGM. The Board of Directorsrecommends the resolutions.(c) Operations of subsidiaries Uniflex Cables Ltd. (UCL)and its wholly-owned subsidiary, Marine Cables &Wires Private Limited (MCWPL)The Company got involved in day to day management of UCL,since September 2008 and thereafter, it has taken several stepsin the area of productivity improvement, debottlenecking ofmanufacturing facility, expansion of production lines andmarkets and strengthening of managerial resources. Thisresulted in UCL being prepared for facing long term challengesand steps taken during the year for improvement of operationswere reflected in its increased net sales during the last fourmonth period (December 2009 to March 2010) of Rs. 876.1million as against total net sales of Rs. 930.08 million for thefirst eight months of the financial year 2009-10. Accordinglynet sales, during 2009-10, were Rs. 1,806.18 million against Rs.1,278.59 million in the previous financial year 2008-09. Net lossin the last quarter of FY 2009-10 were Rs. 51.49 million againstthe average loss per quarter of Rs. 74.32 million in the precedingthree quarter of the financial year 2009-10. However, this wasnot sufficient to break–even and UCL has incurred a net loss ofRs. 274.58 million after tax as against a loss of Rs. 286.75million for the previous year 2008-09.


2. DividendThe Board of Directors recommended final dividend for 2009-10on 32,336,031 equity shares at Rs. 5 (50%) per share.This final dividend is payable after declaration by shareholders atthe ensuing Annual General Meeting (AGM) and you arerequested to declare the same.3. Management discussion and analysis/outlook(a) Industry structure, development, opportunities,threats, outlook and risk and concernsThe Indian power sector continues to see substantial investmentin the generation, transmission and distribution segments. Thepower generation should increase by about 50 KMW in theEleventh Five Year Plan compared to 52.3 KMW in past 15 years.As a consequence, there will be a significant spending on theTransmission and Distribution (T&D) segment to transmit anddistribute the power. The Twelfth Five Year Plan is expected toadd about 100,000 MW additionally. Given that the additionsin the Eleventh Plan is back ended, there is an expectation thatT&D investment will accelerate over the next 5-7 years.The Company has two business segments, each of whichcontinued to maintain significant market share positions. TheCompany is deriving about 75% of its revenue from powersector on the basis of use by the end customer. Margins fromthe manufacturing activities during 2009-10 were substantiallyimproved to Rs. 1,385.11 million from Rs. 524.03 million in theprevious year. The segment-wise operations were as under:(i) Transformer oil and speciality oils segmentThis division contributed 51% of the Company’s revenue. Detailsof production, sales revenue and segment profit (standalonebasis) are:

2009-10 2008-09 VariationTurnover

KL #2,47,689 #1,99,648 (+) 48,041Rs/million 10,251.51 10,804.33 *(-) 552.82

Segment profit-Rs/million 879.54 (377.73) (+) 1,257.27

# Includes conversion by the Company on customers’ account.*Due to reduced sale price in line with reduced cost of base oils(an international phenomena).

After the business suffered very badly in Q3FY09 and Q4FY09 (aworld-wide phenomena), there was a very strong turnaroundboth in terms of volume and margins during the financial year2009-10. This is attributed to growth in sales of transformer oil,white oils and industrial oil sub-segments, both in the domesticand exports markets.The sales mix of transformer oils improved on account of moresales to higher rating power transformers and specialrequirements.The Company expects continued growth of at least 15% in thetransformer oil segment for the next 3-4 years based onindications of the ongoing expansions in the power sector inIndia. More specifically, the growth in the EHV segment as thetransmission networks being built are expected to increase thedemand, where the Company has a clear leadership positionwith approvals from major transformer OEMs and utilities likePower Grid Corporation of India Ltd. (PGCIL).The Company has also established itself as the largest marketerin India of new generation eco-friendly non-labelled rubberprocess oils for the tire sector that meets the new European andJapanese standards.The net sales turnover of the “Agip" brand automotive lubricantsproduced by the Company with license and technical know-howof ENI-S.p.A of Italy and marketed by Apar ChemateK LubricantsLtd., (50:50 joint venture company with ChemateK SpA) (ACL)increased substantially by 31.1%. ACL earned a profit of Rs.49.98 million during the FY 2009-10 as against loss of Rs. 41.54million in the previous year.Risk and concernsThe Company imports over 90% of its base oils. There has beencontinuous volatility in base oil prices and in foreign exchangerates. To protect itself, the Company has been quoting pricesonly on a monthly basis or using the IEEMA price - variationformula for long term deals. It has also been following ahedging strategy to cover foreign exchange exposure as soonas sales prices are fixed, thereby converting $ payables to Rs.for pricing of products. There is a cost for taking forward coverswhich the Company needs to absorb. However, given thecurrent volatility, it is a prudent strategy to follow.


The Company also takes adequate steps for in-house training ofemployees and maintaining safety and healthy environment forworkers working within the factory premises. 4. Directorsa) Mr.V A Gore, Director of the Company and Chairman of theAudit Committee expired on December 2, 2009 after shortduration of illness. Mr. Gore was associated with the Companyfor the last over 15 years. The Board deeply mourns the saddemise of Mr. V A Gore and place on record their sincereappreciation for the valuable guidance and assistance providedby Mr. Gore during his tenure as a Director of the Company.b) Mr. Gary Ng Jit Meng, who was appointed by M/s. ShinnyLimited in terms of Clause 7 of the investment agreement,ceased to be a director by resignation w.e.f. conclusion of theBoard of Directors’ meeting on January 21, 2010. The Boardplaces on record its appreciation for the valuable guidance andsupport rendered by Mr. Gary Ng Jit Meng during the tenure ofhis association with the Company.c) Mr. C N Desai and Dr. N K Thingalaya, Directors shall retire byrotation at the ensuing annual general meeting of the Companyand they, being eligible, offer themselves for reappointment.The Board recommends the re-appointment of these Directors. 5. Directors’ responsibility statementPursuant to the requirement under Section 217(2AA) of theCompanies Act, 1956 with regard to directors’ responsibilitystatement, it is hereby confirmed that-i. In the preparation of the annual accounts for the financialyear ended March 31, 2010, the applicable accountingstandards were followed along with proper explanation relatingto material departures, if any.ii. Appropriate accounting policies were selected and appliedconsistently and judgements and estimates were made thatwere reasonable and prudent so as to give a true and fair viewof the state of affairs of the Company at the end of the financialyear and of the profit of the Company for the financial yearunder review.iii. Proper and sufficient care was taken for the maintenance of

adequate accounting records in accordance with the provisionsof the Companies Act, 1956, for safeguarding the assets of theCompany and for preventing and detecting fraud and otherirregularities.iv. The annual accounts were prepared on a going concern basis.6. AuditThe qualification in paragraph 4 of attached Auditors’ Reportare self- explanatory and do not call for any further commentsor explanations. In this regard attention is also invited toparagraph 3(a) (ii) of this Report.M/s. Price WaterHouse (PW), Chartered Accountants, Mumbai,Statutory Auditors of the Company shall be retiring at theensuing Annual General Meeting, and they being eligible, offerthemselves for reappointment. The Audit Committee ofDirectors at its meeting held on May 25, 2010 recommendedreappointment of M/s. PW as statutory auditors of the Companyfor the financial year 2010-11.7. Other informationa. Attached to and forming part of this report are the following:(i) Particulars relating to Employee Stock Option Scheme.(ii) Particulars relating to conservation of energy, technologyabsorption, Research and Development and foreign exchangeearnings and outgo.(iii) Report on Corporate Governance and auditors’ certificateregarding compliance of conditions of corporate governance.The Ministry of Corporate Affairs has issued “CorporateGovernance Voluntary Guidelines” in December 2009. Whilethese guidelines are recommendatory in nature, the Companyis in the process of adopting these guideline gradually. b. Particulars of employees – Information as per Section217(2A) of the Companies Act, 1956 read with the Companies(particulars of employees) Rules, 1975, forms part of this Report.However, as per the provisions of Section 219(1)(b)(iv) of theAct, the report and the accounts are being sent excluding thestatement containing the particulars to be provided underSection 217(2A) of the Act. Any member interested in obtainingsuch particulars may inspect the same at the registered office


UCL faced a very competitive environment in which there wassevere margin erosion in the face of diminishing demand.However, in second half of FY10, the demand for power cablesimproved considerably. This resulted in better sales and marginsimproved to some extent, but still not fully recovered to theextent pre-September 2008 levels. UCL, however, streamlinedproduction, invested in upgrading equipment, manpower andprocesses and expects to do over Rs. 2,750 million in net salesin FY11, with a cash break-even level of profitability. On account of losses incurred during the year under review andalso with carried forward losses of past years, the entire networth of the UCL got eroded as at the end of the financial yearMarch 31, 2010. UCL is required under the provisions of SickIndustrial Companies (Special Provisions) Act, 1985 (SICA) tomake a reference to the Board for Industrial & Financial Re-construction (BIFR) for determination whether the UCL is a sickindustrial company or not and UCL will shortly file the same.The Company shall provide required support for revival of theunit.The Company has an equity investment of Rs. 834.37 million inUCL as at March 31, 2010. Considering the present net worthposition of UCL the Company deems it prudent to provide forimpairment in the value of equity investment in UCL.Accordingly, the Company provided (non-cash charge) Rs. 555.4million in its 2009-10 accounts as an extraordinary item.During the year ended March 31, 2010, MCWPL earned profitof Rs. 6.62 million (before tax) as against loss of Rs. 5.79 millionin the previous year. On account of brought forwarded losses ofthe previous years, its entire net worth got eroded as at the endof financial year March 31, 2009 and MCWPL had filed requiredreference to BIFR in the month of October 2009. BIFR vide itsorder dated February 5, 2010 has declared MCWPL as sickindustrial company and directed MCWPL to submit DraftRehabilitation Scheme (DRS) for its revival which will besubmitted shortly by MCWPL. The Company shall providerequired support for its revival and the Board authorised themanagement to discuss the proposal to be submitted byMCWPL to BIFR for amalgamation of MCWPL with theCompany.(d) Cautionary statementThe statements made in the management discussion & analysis

section, describing the Company’s goals, expectations, orpredictions etc. do contain some forward looking views of themanagement. The actual performance of the Company isdependent on several external factors many of which are beyondthe control of the management viz. growth of Indian economy,continuation of industrial reforms, fluctuations in value of Rupeein foreign exchange market, Volatility in commodity pricesapplicable laws/ regulations, tax structure, domestic/international industry scenario, movement in international pricesof raw materials and economic developments within the country etc. (e) Internal control systems (ICS) and their adequacyThe Company established adequate ICS in respect of all thedivisions of the Company. The ICS are aimed at promotingoperational efficiencies and achieving saving in cost andoverheads in all business operations. The System Applicationand Product (SAP), a world class business process integrationsoftware solution which was implemented by the Company atall business units has been operating successfully.For tightening and more effective internal control systems andrisk management, the Company continued the engagement ofM/s. KPMG India Pvt. Ltd., Chartered Accountants as internalauditors of the Company.The system cum internal audit reports of the internal auditorsare discussed at the Audit Committee meetings and appropriatecorrective steps have been taken.Further, all business segment prepare their annual budget,which are reviewed along with performance at regular interval. (f) Development of human resources The Company promotes open and transparent workingenvironment to enhance teamwork and build business focus.The Company equally gives importance to the development ofhuman resource (HR). It updates its HR policy in line with thechanging HR culture in the industry as a whole. In order to fosterexcellence and reward those employees who perform well, theCompany practices performance/production linked incentiveschemes and introduced Employees Stock Option Schemereferred to in para 7 (a)(i) and as detailed in an attachment tothis report. The main object of the Scheme is to create andmaintain optimum performance level and profit driven cultureand improve productivity.

15Annual Report 2009-1014 Apar Industries Limited

Members’ approval was obtained at the Annual GeneralMeeting held on August 9, 2007 for introduction of EmployeesStock Option Scheme to issue and grant upto 16,16,802options and it was implemented by the Company. The optionshave been granted to employees in accordance with theSecurities and Exchange Board of India (Employees Stock

Option Scheme and Employees Stock Purchase Scheme)Guidelines, 1999 (the SEBI Guidelines). The Employees StockCompensation Committee, constituted in accordance with theSEBI Guidelines, administers and monitors the Scheme.The disclosures stipulated under the SEBI Guidelines are givenbelow:

a. Options granted by the Compensation Committee : 175,150b. Exercise price : Rs. 207.05 per optionc. Options vested : 58,383d. Options exercised : Nile. The total number of shares arising as a result of exercise of options : 175,150f. Options lapsed : Nilg. Variation in terms of options : See note 1 belowh. Money realised by exercise of options : Nili. Total number of options in force : 175,150j. Employee-wise details of options granted to:

i. Senior Management Personnel / Directors(a) Mr. H N Shah : 7,500(b) Mr. V A Gore* : 4,000(c) Dr. N K Thingalaya : 4,000(d) Mr. F.B.Virani : 4,000

ii. Any other employee who received a grant in any one year of options amounting : Nilto 5% or more of options granted during that year

iii. Identified employees who were granted options, during any one year, equal to : Nilor exceeding 1% of the issued capital (excluding outstanding warrants andconversions) of the Company at the time of grant

k. Diluted Earnings Per Share (EPS) pursuant to issue of shares on exercise of options : Rs. 9.46calculated in accordance with Accounting Standard (AS) 20 Earnings Per Share

Note 1) 175,150 options at the exercise price of Rs. 259.75 granted

on January 23, 2008 were cancelled on May 27, 2008. Thecancellation was necessary due to substantial reduction inthe price of shares in the secondary market andsimultaneously therewith the above detailed options weregranted. The confirmation of the shareholders for the saidcancellation and subsequent grant was sought at the 19thAnnual General Meeting held on August 29, 2008.

2) As the exercise of options would be made at the market

linked price of Rs. 207.05, the issuance of equity sharespursuant to exercise of options will not affect the profit andloss account of the Company.

3) The Company obtained in-principle approval for the listingof the entire 1,616,802 equity shares to be issued andallotted on exercise of options as and when exercised underthe scheme.

4)* Mr. V A Gore expired on December 2, 2009. Optionsgranted to him would vest with his legal heirs’ / beneficiary.

EMPLOYEE STOCK OPTION Annexure to the Directors’ Report

of the Company or write to the Company Secretary for a copythereof.c. The Company has been granted exemption for the year endedMarch 31, 2010 by the Ministry of Corporate Affairs vide itsletter dated March 19, 2010 (Exemption Letter), from attachingto its Balance Sheet, the annual report of Company’s wholly-owned foreign subsidiaries viz. Petroleum Specialities Pte. Ltd.,Singapore as well as its subsidiary Quantum Apar Speciality OilsPty. Ltd., Australia and Poweroil Speciality Products FZE, Sharjah,Uniflex Cables Limited, subsidiary of the Company and MarineCables & Wires Private Limited, subsidiary of Uniflex CablesLimited. As per the terms of exemption, a statement containingbrief financial details of the said subsidiaries for the year endedMarch 31, 2010 are included in the annual report. The annualaccounts of the said subsidiaries and the related informationwill be made available to any member of the Company seeking

such information at any point of time and are also available forinspection by any member of the Company at the registeredoffice of the Company.d. As on March 31, 2010, the aggregate fixed deposits of Rs.0.761 million were due for repayment but remained unclaimed.Letters have been sent to such depositors to claim the amountsdue to them.8. AcknowledgementYour Directors wish to place on record their sincere appreciationfor continuous cooperation, support and assistance provided bystakeholders, financial institutions, banks, government bodies,technical collaborators, customers, dealers and suppliers of theCompany. Your Directors also wish to place on record theirappreciation for the dedicated services rendered by the loyalemployees of the Company.

For and on behalf of the Board

Place: Mumbai Dr. N. D. DesaiDate: May 25, 2010 Chairman


Reasons for change in consumption:Electricity : Oil : Change in Product mix

Conductors : Change in product mix Furnace Oil & LDO : Oil : Change in Product mix

Conductors : Change in product mix

(B) Consumption per unit of production (Average per unit consumption on total production of each division isincluded in the table below):

2009-10 2008-09Electricity Furnace Oil Electricity Furnace Oil

(Units) (litres) (Units) (litres)(i) Refinery Division :

Per KL output of Oil 11.13 1.86 11.02 1.81(ii) Properzi and AAC/ACSR/AAAC

Conductors Division :Per MT output of Aluminum/Alloy 214 79 213 74Conductors

4) Total Energy Consumption and Energy Consumption per unit of production:(A) Power and Fuel Consumption

2009-10 2008-09(i) Electricity

(a) Purchased units 19,305,625 22,105,871Total Amount (Rs/millions) 81.51 92.92Rate/Unit (Rs) 4.22 4.20

(b) Own GenerationThrough Diesel Generator (Units) 883,759 774,003Average Units generated per liter of diesel oil 3.14 2.82Average Cost of Unit (Rs) 10.55 12.49

(ii) Furnace OilQuantity (Kls) 6,866 7,513Total Amount (Rs./millions) 155.98 178.39Average Rate/Kls (Rs.) 22,720 23,687

INFORMATION AS PER SECTION 217(1)(e) OF THE COMPANIES ACT, 1956 READ WITH THECOMPANIES (DISCLOSURE OF PARTICULARS IN THE REPORT OF BOARD OF DIRECTORS) RULES,1988 AND FORMING PART OF THE DIRECTORS’ REPORT FOR THE YEAR ENDED 31ST MARCH, 2010.

I. Conservation Of Energy1) Energy Conservation measures taken and

continuing on regular basis:Conductor Division:i. Replacement of HPSV & HPMV light fixture by energy

efficient CFL light fixture.ii. Installation of water breaking unit at RAC of CCR-3 for

reduction of air consumption.iii. Replacement of Eddy current motor system by AC induction

motor in rewinding Machine.iv. Installation of energy efficient VFD drive panel on rewinding

machine.Oil Division:i. Replacement of 4.045 KW Lighting load by 1.113 KW CFL

lights reduced the lighting load by 2.932 KW.ii. Installed 13 Nos. Atcon power saving device for the window

air conditioners. Power savings are 3640 KWH/Month (for 12 hr running daily); approximate savings is Rs. 21,840per month.

iii. Agitators running under load are converted into Yconnection from Delta connection. Reduced the KVA by11.13 KVA.

iv. Transparent sheets provided in process area, packagingplant, and main ware house to increase the illumination levelso as to reduce the consumption of power in daytime.

Increased the Lux level from 250 Lux to 1200 Lux &approximate saving is Rs. 2,496 per month.

v. Installed 40 Nos. wind turbines ventilator in lube blendingand HLP plant area.

vi. Reduction of cycle times of processes in production units.vii. Reduction in the running hours of Air compressor per KL of

production, resulting in saving of Rs. 12,000 per month. 2) Additional Investment proposals, if any, being

implemented for reduction of consumption ofenergy:

i. Twenty more wind turbine ventilator is to be provided in theremaining plant’s shed, for minimizing the usage of pedestalfans.

ii. Transparent sheets are to be provided in HLP plant area, toincrease the illumination level and to reduce the lightingpower consumption in day time.

iii. Provision of additional CFL lights in the plant to reduce thelighting load.

iv. Provision for five more power saving device for Airconditioners.

3) Impact of measures at (1) and (2) above:i. Electrical energy savings.ii. Less failure of equipments /motors.iii. More up time resulting into more productivity.

Annexure to the Directors’ Report


Corporate Governance PhilosophyApar Industries Limited (“the Company”) believes in conductingits affairs in a fair, transparent and professional manner andmaintaining the good ethical standards in its dealings with all itsconstituents.The Company is committed to follow good CorporateGovernance practices, which include having professionalDirectors on the Board, adopting pragmatic policies andeffective systems and procedures and subjecting businessprocesses to audits and checks, compliant with the requiredstandards.The driving force behind the Company’s management is“Tomorrow's Progress Today” and backed by “A culture ofHigh - Tech Practices and Quality”. Apar’s quality policy forISO-9001 is “To satisfy customer needs and retain leadershipby manufacturing and supplying quality products andservices through continuous improvement by motivatedemployees”.The policies and actions of the Company are in line with theapplicable guidelines on Corporate Governance with anendeavour to enhance shareholders’ value. Pursuant to Clause49 of the Listing Agreement of Stock Exchanges, the followingdetails are presented:

Board of Directors1. The Board of Directors is the apex body constituted by theshareholders for overseeing the overall functioning of theCompany. The Board provides and evaluates the strategicdirection of the Company, management policies and theireffectiveness and ensures that the long-term interests of theshareholders are being served. The Board of Directors has morethan 50% Non-executive Directors and the Chairman, beingNon-Executive Director and Promoter, half of the total numberof directors are Independent Directors. None of the Directors onthe Board is a member on more than 10 Committees andChairman of more than 5 Committees as specified in Clause 49across all companies in which he is a director. All the membersof the Board are eminent persons with excellent qualifications;professional expertise and extensive experience and they havemade outstanding contributions to the industry.2. The Board of Directors meets at least four times a year withmaximum time gap of 4 months between any two meetings toreview the Company’s performance and financial results andmore often, if considered necessary.3. The composition of the Board of Directors and details withregard to them is as follows as on 31st March, 2010 :-


Corporate Governance Report

* The directorships held by Directors as mentioned above do not include alternate directorships and directorships of foreigncompanies and deemed public companies, Section 25 Companies and private limited companies. # As legally advised.No Director is related to any other Director on the Board in terms of the definition of “relative“ given under the Companies Act, 1956except Mr. Kushal N. Desai and Mr. Chaitanya N. Desai who are brothers and Dr. N. D. Desai who is their father.

Name of Directors Category No. of Directorships No. of Committee No. of Committeein other public Memberships Chairmanships

Companies* in other in otherpublic Companies public Companies

Dr. N. D. Desai Chairman (Non- Executive) 2 – –Mr. V.A. Gore Non-Executive & Independent 3 4 2(Upto 01.12.2009)Dr. N.K.Thingalaya Non-Executive & Independent 2 1 1Mr. F. B. Virani Non-Executive & Independent 1 1 –Mr. Kushal N. Desai Managing Director 3 1 –Mr. C. N. Desai Joint Managing Director 3 2 –Mr. H. N. Shah Non-Executive & Independent# 1 2 1Mr. Gary Ng Jit Meng Non-Executive 2 1 –(Upto 21.01.2010)

II. Technology Absorption and Research &Development:1. Research and Development (R&D):i) Specific areas in which R & D is carried out by the

Company:– Development of new types of up-rating Conductors, with

utility in re-conductoring with enhanced power transmissioncapacity. Al-59, TAL developed and has been commerciallyproduced. ACSS is developed and commercially yet toproduce.

– Company’s in-house R&D oil unit at Rabale, Navi Mumbaihas been granted registration with the Department ofScientific & Industrial Research (DSIR), Government of India, Ministry of Science and Technology and exemptingthe said in-house R&D unit from customs duty and centralexcise.

– The Company has initiated a Six Sigma, a businessmanagement strategy using DMAIC approach in varioussections of Speciaility Oils division at Rabale. Six Sigma focuson improving the process efficiency, Productivityimprovement and Energy Conservation.

ii) A) Benefits derived as a result of the R&D:a) Commercial production has commenced.b) Product accepted by the customer.c) Value addition has increased.d) Benefits in Custom Duty, Central Excise and Income

Tax.

B) Benefits derived from Six Sigma– Process efficiency, Productivity improvement, Energy

Conservation, Process capability and Reduction invariation leading to Cost effectiveness.

iii) Future plan of action:a) Extending Six Sigma to Silvassa Oil Unit.b) Development of new types of Conductors such as STAL

and Trapazodal conductor is targeted for the currentyear,

iv) Expenditure on R&D:Rs. 19.28 million

2. Technology Absorption, Adaptation and Innovation:a) Technology Imported (in last five years)

License to use proprietary knowhow, formulae,trademarks and trade names relating to manufacture &sale of lubricating Oils, Greases and other specialLubricants for industrial, automotive and marineapplications.

b) Year Import 2007

c) Has technology been fully absorbed Yes.

III. Foreign Exchange Earnings and Outgo:1. Activities related to exports:Efforts are continuing to increase exports of all products.

2. Total Foreign Exchange used and earned2009-10 2008-09

(i) Total foreign exchange used(a) Raw Materials (CIF) 9,694.13 14,845.29(b) Stores & Spares 3.56 2.77(c) Capital Goods 20.11 23.23(d) Others 343.91 524.20

10,061.71 15,395.49(ii) Total foreign exchange earned

(a) Physical Exports (FOB) 5,022.53 6,554.24(b) Deemed Exports (eligible for export incentives) 861.68 1,488.63(c) Others 256.51 266.16

6,140.72 8,309.03

(Rs. in million)


above the administration and other related matters ofEmployee stock Option Plan, the approval of remunerationpayable to managerial persons in accordance with the provisionsof Part II and Section II of Schedule XIII of the Companies Act,

1956 and under any other law. During the Financial year 2009-10 Compensation-cum-Remuneration Committee meeting was held on June 25, 2009.

Remuneration policy, details of remuneration and otherterms of appointment of Director: The remuneration policy of the company is directed towardsrewarding performance, based on review of achievements on aperiodical basis.The remuneration policy is in consonance with the existing

Industry practice.Details of remuneration paid to all the Directors:1. The non-executive directors receive the sitting fees for attendingthe Board and Committee meetings, as the case may be.2. The break up of remuneration paid / payable to the ManagingDirectors for the financial year 2009-2010 is as under:

3. In terms of Section 309(1) of the Companies Act, 1956, Dr.N. D. Desai, a Non-Executive Chairman has been paid Rs.4,600,000/- for his professional services to the Companytowards his fees and Rs. 6,982,887 as commission includingmonetary value of facilities during the period from April 1, 2009to March 31, 2010.4. In terms of Section 309(1) of the Companies Act, 1956, ShriH. N. Shah, a Non-executive Professional Director has been paid

for his professional services to the Company Rs. 2,239,055/-towards his fees including monetary value of facilities duringthe period from April 1, 2009 to March 31, 2010.The professional fees of above two directors have been fixed bythe Board after considering their professional expertise andexperience in the respective fields, loyalty and professional feesstructure prevalent in the industry.


4. During the financial year 2009-2010, six Board Meetings wereheld. The dates on which the Board meetings were held are asfollows:May 23, 2009, June 25, 2009, July 23, 2009, September 4,2009, October 29, 2009 and January 21, 2010.

General MeetingsThe last Annual General Meeting (20th AGM) was held onSeptember 4, 2009 at 11.00 A.M. at Auditorium of the VanijyaBhavan, Central Gujarat Chamber of Commerce, Near GEB HeadOffice, Race Course, Vadodara – 390 007. Following are the details of attendance of Directors at theaforesaid Board Meetings and AGM held during the financial year.

Compensation-cum-RemunerationCommitteeComposition: The Compensation –cum- RemunerationCommittee of the Board comprises of five directors, namely, ShriV.A.Gore #, Chairman, Dr.N.K.Tingalaya, Shri F.B.Virani, Shri

C.N.Desai, Shri K.N.Desai and Shri H.N.Shah.# Upto 01.12.2009 Term of Reference: The Broad terms of reference of theCompensation-cum-Remuneration Committee include, over and

Audit Committee1. The Company has constituted an Audit Committee ofDirectors in accordance with the requirements of Section 292Aof the Companies Act, 1956 read with Clause 49 of the ListingAgreement. The Audit Committee consists of three independentDirectors. The broad terms of reference of the Audit Committeeinclude, reviewing with the management, the quarterly andannual financial results / statements, adequacy of internalcontrol systems and internal audit functions, overseeing the

Company’s financial reporting process, recommending theappointment and removal of external and internal auditors, etc. 2. The composition of the Audit Committee and attendance ofDirectors at the meetings are given hereunder:During the financial year 2009-2010, the Audit Committee meton May 23, 2009, June 25, 2009, July 23, 2009, October 29,2009 and January 21, 2010.

Name of Directors No. of Board meetings held during No. of Board Last AGMthe tenure of the Directors meetings attended attendedDr. N.D. Desai 6 5 YesMr. V.A. Gore (Upto 01.12.2009) 5 5 YesDr. N. K. Thingalaya 6 5 YesMr. F. B. Virani 6 6 YesMr. Kushal N. Desai 6 6 YesMr. C. N. Desai 6 6 YesMr. H. N. Shah 6 6 YesMr. Gary Ng Jit Meng (Upto 21.01.2010) 6 5 No

Name of Category No. of meetings held during No. ofCommittee Member the tenure of meetings attended

Committee MemberMr. V. A. Gore, Chairman Independent & Non-Executive 5 4(Upto 01.12.2009)Dr. N. K. Thingalaya* Independent & Non-Executive 5 4Mr. F. B. Virani Independent & Non-Executive 5 5Mr. Gary Ng Jit Meng Non-Executive 5 5(Upto 21.01.2010)Mr. H. N. Shah, Independent & Non-Executive – –(w.e.f. 21.01.2010)

Name of Category No. of meetings held during No. ofCommittee member the tenure of meetings attended

Committee memberMr. V. A. Gore, Chairman Independent & Non-Executive 1 1(Upto 01.12.2009)Dr. N. K. Thingalaya Independent & Non-Executive 1 –Mr. F. B. Virani Independent & Non-Executive – –(w.e.f. 21st January, 2010)Mr. K. N. Desai Executive Director 1 1Mr. C. N. Desai Executive Director 1 1Mr. H. N. Shah Independent & Non-Executive 1 1

Mr. Kushal N. Desai Mr. C. N. DesaiPosition Managing Director Joint Managing DirectorSalary (Rs.) 2,377,251 2,457,303Commission (Rs.) 6,982,887 6,982,887Perquisites / Allowances (Rs.)* 3,998,806 4,031,097Total (Rs.) 13,358,944 13,471,287Stock Option Granted (Nos.) Nil NilService Contract 5 years 5 yearsfrom 01/01/2007 to 31/12/2011 from 01/01/2007 to 31/12/2011Notice Period 1 Month 1 Month

*includes Rs. 1,664,711 each (total – Rs. 3,329,423) paid in respect of previous year.

* Dr. N. K. Thingalaya was Chairman for the Audit Committee Meeting held on 21st January, 2010.


Disclosuresa) General Body MeetingThe details of last three Annual General Meetings (AGM) of shareholders of the Company held are as under :i. Annual General Meetings (AGM):

(b) Postal BallotThe consent of the shareholders was obtained by means ofvoting by postal Ballot on 9th November, 2009 in respect of thefollowing Special Resolution as proposed in Postal Ballot Noticedated 4th September, 2009 during the year:Resolution: “Special Resolution under Section 372A of theCompanies Act, 1956 for making investment, giving loan orguarantee or providing any security in excess of the limits setout therein”.

Procedure for postal Ballot: The postal Ballot process wasundertaken in accordance with the provision of Section 192A ofthe Companies Act, 1956, read with the Companies (Passing ofResolution by Postal Ballot) Rules, 2001.The Board of Directors had appointed Mr. Hemang M. Mehta ofM/s. H. M. Mehta & Associates, Practicing Company Secretaries,Vadodara as the Scrutinizer for conducting the postal ballotprocess.


Share Transfer & Shareholders’ GrievanceCommittee1. The Board of Directors of the Company has constituted ShareTransfer & Shareholders’ Grievance Committee of Directors inorder to meet the requirement of Clause 49 of the ListingAgreements of the stock exchanges. This Committee has beenconstituted with the objective of overseeing redressal ofinvestors’ complaints pertaining to transfers / transmission of

shares, issue of duplicate share certificates, non-receipt ofdividend / interest, dematerialisation (Demat) of shares and allother related matters concerning investors.2. Share Transfer & Shareholders’ Grievance Committee metthree times during the financial year, i.e. on 23rd May, 2009,4th September, 2009 and 21st January, 2010.The composition of Committee and attendance of Directors atthese meetings are given below :

Share Transfer System1. The Board of Directors has delegated the power of approvalof share transfers to the Company Secretary and DeputySecretary of the Company jointly, who approve the sharetransfers regularly on fortnight basis, and gist of transfers areplaced before the Share Transfer & Shareholders’ GrievanceCommittee. Compliance Officer :Mr. Sanjaya Kunder, Company Secretary,Apar Industries Limited, Apar House, Corporate Park,Sion-Trombay Road, Chembur,Mumbai – 400 071.

2. Status of complaints for the period April 1, 2009 to March31, 2010.1. No. of complaints received 132. No. of complaints resolved 133. No. of complaints not solved to the satisfaction Nil

of the investors as at March 31, 2010.4. Complaints pending as at March 31, 2010 Nil5. No. of share transfers pending for Nil

approval as at March 31, 2010. Risk Assessment & Minimisation ProcedureThe Company has laid down procedure to inform the Membersof the Board about the risk assessment and minimisationprocedure. These procedures are periodically placed and arereviewed by the Board of Directors.

5. Remuneration paid to Non-Executive Directors for attending the meetings of Board of Directors and Committees is as given below:Name of Directors Sitting Fees (Rs.) No. of Equity Shares No. of Stock Options

held in the Company granted Dr. N. D. Desai 1,10,000 68,50,692* NilMr. V.A. Gore 1,40,000 – 4,000 Dr. N. K.Thingalaya 80,000 – 4,000 Mr. F. B. Virani 97,500 6,700 4,000 Mr. H. N. Shah 1,35,000 2,960 7,500 Mr. Gary Ng Jit Meng – – Nil* Includes shares held as Trustee

Name of Category No. of meetings held No. of meetings Committee member attendedShri V. A. Gore, Chairman @ Independent & Non-Executive 3 2(Upto 01.12.2009)Dr. N. D. Desai, Chairman # Non- Executive Director 3 3Shri C. N. Desai Executive Director 3 3Shri H. N. Shah Independent & Non-Executive 3 1(w.e.f. 21.01.2010)

@ Chairman upto December 01, 2009. # Chariman w.e.f. January 21, 2010.

AGM Date & Time Location Details of Special Resolutions20th September 4, 2009 The Auditorium, Vanijya Bhavan, No Special Resolution.

at 11.00 A.M. Central Gujarat Chamber of Commerce, Race Course Circle, Vadodara – 390 007

19th August 29, 2008 The Auditorium, Vanijya Bhavan, Cancellation of 175,150 options granted at theat 11.00 A.M. Central Gujarat Chamber of Commerce, Exercise Price of Rs. 259.75 per option and issue

Race Course Circle, Vadodara – 390 007 of fresh 175,150 options (in lieu of the cancelledoptions) at the new Exercise Price of Rs. 207.05per option.

18th August 9, 2007 The Auditorium, Vanijya Bhavan, a) Appointment of Shri Kushal N. Desai asat 11.00 A.M. Central Gujarat Chamber of Commerce, Managing Director of the Company for 5 years

Race Course Circle, Vadodara – 390 007 w.e.f. 1st January, 2007.b) Appointment of Shri Chaitanya N. Desai asJoint Managing Director of the Company for 5years w.e.f. 1st January, 2007.c) Approval to the Board for implementation ofEmployee Stock Option Scheme – 2007.d) Approval to the Board to extend EmployeeStock Option Scheme – 2007 to the permanentemployees including Directors of the Companywhether working in or outside India of theHolding Company and Subsidiary Companies ofthe Company.


3. Book Closure Dates : Monday July 26, 2010 to Monday, August 2, 2010.(both days inclusive)

4. Dividend Payment : Dividend Warrants will be dispatched after the AGM, but before the expiry ofstatutory period of 30 days from the date of the AGM.

5. Registered Office : 301, Panorama Complex, R. C. Dutt Road, Vadodara 390 007.6. Listing of Shares on the Stock Exchanges : The Equity Shares of the Company are listed on –

- Bombay Stock Exchange Limited, Mumbai (BSE) - Scrip Code No. 532259Phiroze Jeejeebhoy Towers, Dalal Street, Fort, Mumbai – 400 001.- National Stock Exchange of India Limited(NSE) - Scrip Code - APARINDS“Exchange Plaza”, Bandra- Kurla Complex, Bandra (E), Mumbai – 400 051.The Company has paid due listing fees of both the Stock Exchanges.

7. Stock Price Data for the financial year April, 2009 to March, 2010 prevailed at the Bombay Stock Exchange Ltd.(BSE) and The National Stock Exchange of India Ltd. (NSE):

8. Stock Performance:The performance / movement of price of the Company’s Equity Share as compared to BSE Sensitive Index is given in the chart below:

77.30 84.00

112.0096.65

117.05135.00

160.05 162.10 165.10 161.50 167.30100

.95158.55 159.00

131.00

153.50

199.80 195.60179.70

174.95

210.00

194.00

216.90

10911.2

0130

46.14

14782.4714635.19

15414.67 16338.4516825.66

16684.29 17090.3117260.41

16183.8117302.72


Date of Declaration of result of Postal Ballot:The Chairman announced the result of postal ballot process onNovember 9, 2009. All the statutory formalities relating to thechange have been complied with.c) Related Party transactionsThe details of all significant transactions with related parties areperiodically placed before the Audit Committee. The relevantdetails of all transactions with related parties given in Note No.13 of Schedule No. 22 of the audited Accounts for the financialyear 2009-2010, form a part of this report also. There are nomaterially significant related party transactions of the Companywhich have potential conflict with the interests of the Companyat large.d) The Company has complied with the requirements ofregulatory authorities on capital markets and no penalties orstrictures have been imposed on it during the last 3 years.e) The statutory financial statements of the Company arequalified.f) Means of CommunicationQuarterly / Half Yearly / Yearly Financial Results: Generallypublished in Gujarat edition of “The Business Standard”, Englishdaily newspaper and “Loksatta” - Gujarati daily newspaper.Financial Results of the Company are displayed on theCompany’s website: www.apar.comPursuant to Clause No. 51 (omitted w.e.f. April 1, 2010) of theListing Agreement of Stock Exchanges, the Company was also

registered for EDIFAR filing and the login ID of Company is“APARIND”. Shareholders could login EDIFAR section of web-site – www.sebiedifar.nic.in for the information relating toQuarterly / Annual Financial Results, Quarterly ShareholdingPatterns etc.With effect from April 1, 2010, SEBI has discontinued theEDIFAR System by amending Clause 32 and omitting Clause 51of the Listing Agreement. The aforesaid facility is not availablenow.g) Management Discussion & Analysis is covered under theseparate head of the Directors’ Report of 2009-2010.h) The Company has complied with mandatory requirement ofCorporate Governance provisions and has not adopted non-mandatory requirements except that the Non-executiveChairman is entitled to maintain Chairman’s Office atCompany’s expense and allowed re-imbursement of expensesincurred in performance of his duties.i) Secretarial AuditA qualified Practicing Company Secretary carried out onquarterly basis, a Secretarial Audit to reconcile the totaldematted Share Capital with National Securities DepositoryLimited (NSDL) and Central Depository Services (India) Limited(CDSL) and physical share capital with the total issued and listedshare capital. The Secretarial Audit Report confirms that the totalissued / paid up capital is in agreement with the total numberof shares in physical form and the total number ofdematerialised shares held with NSDL and CDSL.

General Information1. Annual General Meeting :

Day, Date and Time : Monday, 2nd August, 2010 at 2.30 P.M. at The Auditorium, Vanijya Bhavan,Central Gujarat Chamber of Commerce, Race Course Circle, Vadodara 390 007.

2. Financial Calendar for 2010-11 :Financial year ending : March 31First Quarter Results (June, 2010) : On or before August 14, 2010. Half Yearly Results (September, 2010) : On or before November 14, 2010 Third Quarter Results (December, 2010) : On or before February 14, 2011Approval of Annual Accounts (2010-11) : On or before May 30, 2011

Details of Voting Pattern: Particulars Numbers of Number of % to

Members Shares Voted Total Shares VotedTotal Postal Ballot received 404 2,48,01,702 100.00- Postal Ballots - Valid 386 2,47,99,856 99.993- Postal Ballots – Invalid 18 1,846 0.007Postal Ballots / Votes – in favour of the Resolution 347 2,47,95,462 99.982Postal Ballots / Votes – against the Resolution 39 4,394 0.011

BSE NSEYear Month High (Rs) Low (Rs) Monthly volume High (Rs) Low (Rs) Monthly volume2009 April 100.95 77.30 1,39,425 103.00 78.00 1,67,045

May 158.55 84.00 3,50,806 158.75 82.00 4,53,687June 159.00 112.00 1,98,986 160.00 112.25 1,90,840July 131.00 96.65 1,37,260 133.90 95.80 1,98,192August 153.50 117.05 2,93,269 152.00 116.10 3,15,438September 199.80 135.00 9,43,540 199.40 133.05 14,11,679October 195.60 156.20 3,87,801 195.00 156.30 5,47,731November 179.70 160.05 1,76,080 178.80 159.00 1,81,162December 174.95 162.10 89,083 174.90 158.55 1,55,033

2010 January 210.00 165.10 5,96,431 205.00 166.00 8,20,978February 194.00 161.50 1,31,586 189.80 161.25 1,79,769March 216.90 167.30 7,12,080 217.00 167.00 11,40,749


Date of Grant ( the options granted on January 23, 2008 at Rs. 259.75 were cancelled : 27th May, 2008and subsequently, fresh same number of options granted on May 27, 2008 at exercise price of Rs.207.05 per option) Total options granted : 1,75,150Date of vesting of options : 27th May, 2009Total Options vested : 58,383

15. Address for Communication : Shareholders’ Grievances / correspondence should be addressed to theCompany at the Registered Office of the Company at 301, PanoramaComplex, R.C.Dutt Road, Vadodara-390 007.Ph. (0265) 2331935,2339906, Fax (0265) 2330309. E-mail :Investor Grievance Redressal cell:[email protected]


9. Registrar for Share Transfer and Depository : MCS LimitedNeelam Apartment, 88, Sampatrao Colony, B/H. Standard Chartered Bank, Alkapuri, Vadodara – 390 007.Ph. Nos.: (0265) 2339397, 2350490, Fax No.: (0265) 2341639E-mail: [email protected]

12. Dematerialization of Shares & Liquidity :As at March 31, 2010, approx. 99.20 % of total Equity ShareCapital is held in electronic form with National SecuritiesDepository Ltd. (NSDL) and Central Depository Services (India)Ltd. (CDSL). The Company’s equity shares are compulsorilytraded in the electronic form at the Stock Exchanges. Requestsfor dematerialisation of shares are processed and confirmed to

NSDL or CDSL by the Registrar, MCS Limited. The Equity ShareISIN No. is INE372A01015.13. Employee Stock Options :A total of 1,75,150 Options have been granted. Each Option,upon exercise of the same, would give rise to one equity shareof Rs. 10/- each fully paid up. The Details of the Options granted/ vested are as follows:

This is to confirm that the Company has adopted a code of Conduct for its employees and Directors. The said Code is available onthe Company’s web site.I confirm that the Company has in respect of the financial year ended March 31, 2010, received from the senior management teamof the Company and the members of the Board, a declaration of compliance with the Code of Conduct as applicable to them.For the purpose of this declaration, Senior Management Team means the Chief Financial Officer, the Company Secretary and all VicePresidents and Functional Heads of the Company as on March 31, 2010.

Place: Mumbai Kushal N. DesaiDate : 25th May, 2010 Managing Director and CEO

Declaration regarding compliance byBoard Members and Senior Management Personnelwith the Company’s Code of Conduct

10. Distribution of Shareholding as at March 31, 2010:Range of No. of equity % of equity No. of equity % of equity shares shareholders shareholders shares held shareholding

1 - 500 16,329 95.91 8,38,949 2.59501 - 1000 293 1.72 2,16,080 0.67

1001 - 2000 188 1.10 2,75,030 0.852001 - 3000 72 0.42 1,85,785 0.583001 - 4000 30 0.18 1,03,621 0.324001 - 5000 25 0.15 1,19,298 0.375001 - 10000 39 0.23 2,72,183 0.8410001 - 50000 26 0.15 4,71,225 1.4650001 - 100000 6 0.04 4,62,323 1.43And Above 17 0.10 2,93,91,537 90.89Total 17,025 100.00 32,336,031 100.00

11. Shareholding Pattern as at March 31, 2010 :Category No. of equity shares held % holdingPromoters / Persons Acting in concert 2,00,95,464 62.15Banks, Financial Institutions and Insurance Companies 349 0.00Mutual funds 44,09,704 13.64Foreign Institutional Investors 6,00,477 1.86NRIs / OCBs 1,21,891 0.37Corporate Bodies 3,07,715 0.95Resident Individuals 25,05,794 7.75Foreign Investors (Shinny Limited, Mauritius – CLSA Group) 42,94,637 13.28Total 32,336,031 100.00

14. Plant Locations :Division Locationsa) Conductors Division a) Silvassa* and Nalagarh (H.P.)b) Oil Division b) Rabale and Silvassa* * Union Territory of Dadra & Nagar Haveli

FINANCIAL SECTION


To the members of Apar Industries Limited

We have examined the compliance of conditions of Corporate Governance by Apar Industries Limited (‘the Company’), for the yearended March 31, 2010, as stipulated in Clause 49 of the Listing Agreement of the said Company with stock exchanges in India. The compliance of conditions of Corporate Governance is the responsibility of the Company’s management. Our examination wascarried out in accordance with the Guidance Note on Certification of Corporate Governance (as stipulated in Clause 49 of the ListingAgreement), issued by the Institute of Chartered Accountants of India and was limited to procedures and implementation thereof,adopted by the Company for ensuring the compliance of the conditions of Corporate Governance. It is neither an audit nor anexpression of opinion on the financial statements of the Company. In our opinion and to the best of our information and according to the explanations given to us, we certify that the Company hascomplied with the conditions of Corporate Governance as stipulated in the above mentioned Listing Agreement.We further state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency oreffectiveness with which the management has conducted the affairs of the Company.

For Price WaterhouseChartered Accountants

Firm Registration Number: 301112E

Vilas Y. RanePlace: Mumbai Partner Date : 25th May, 2010 Membership No: F-33220

Auditors’ Certificate regarding compliance ofconditions of Corporate Governance

Auditors’ Report Annexure to the Auditors’ Report


To the Members of Apar Industries Limited1. We have audited the attached Balance Sheet of Apar

Industries Limited (the ‘Company’) as at March 31, 2010,and the related Profit and Loss Account and Cash FlowStatement for the year ended on that date annexed thereto,which we have signed under reference to this report. Thesefinancial statements are the responsibility of the Company’smanagement. Our responsibility is to express an opinion onthese financial statements based on our audit.

2. We conducted our audit in accordance with the auditingstandards generally accepted in India. Those Standardsrequire that we plan and perform the audit to obtainreasonable assurance about whether the financialstatements are free of material misstatement. An auditincludes examining, on a test basis, evidence supporting theamounts and disclosures in the financial statements. Anaudit also includes assessing the accounting principles usedand significant estimates made by Management, as well asevaluating the overall financial statement presentation. Webelieve that our audit provides a reasonable basis for ouropinion.

3. As required by the Companies (Auditor’s Report) Order,2003 as amended by Companies (Auditor’s Report)(Amendment) Order, 2004 (together the ‘Order’), issued bythe Central Government of India in terms of sub-section (4A)of Section 227 of ‘The Companies Act, 1956’ of India (the‘Act’) and on the basis of such checks of the books andrecords of the Company as we considered appropriate andaccording to the information and explanations given to us,we give in the Annexure a statement on the mattersspecified in paragraphs 4 and 5 of the said Order.

4. The Company has not provided for a “mark-to-market” losson commodity forward/option contracts aggregating Rs. 400,027,218 as at March 31, 2010 as was required to beprovided on grounds of prudence under the provisions ofAccounting Standard 1 “Disclosure of Accounting Policies’’(Refer Note 7A, Schedule 22), for the reasons stated by themanagement in the said note. Consequently, withoutconsidering the tax effect, the profit for the year andreserves and surplus are overstated and current liabilities areunderstated by Rs. 400,027,218. Had the effect of theobservation made by us been considered, the reported profitwould turn into a loss for the year of Rs. 94,198,819 (as against the reported profit after tax and extraordinaryitems of Rs. 305,828,399), the reserves and surplus wouldhave been Rs. 2,206,451,084 (as against the reported figureof Rs. 2,606,478,302) and the current liabilities would havebeen Rs. 12,135,770,325 (as against the reported figure ofRs. 11,735,743,107).

5. Further to our comments in the Annexure referred to inparagraph 3 above, we report that:a. We have obtained all the information and explanations

which, to the best of our knowledge and belief, werenecessary for the purposes of our audit;

b. In our opinion, proper books of account as required bylaw have been kept by the Company so far as appearsfrom our examination of those books;

c. The Balance Sheet, Profit and Loss Account and CashFlow Statement dealt with by this report are inagreement with the books of account;

d. In our opinion, subject to our comments in paragraph 4above, the Balance Sheet, Profit and Loss Account andCash Flow Statement dealt with by this report complywith the accounting standards referred to in sub-section(3C) of Section 211 of the Act;

e. On the basis of written representations received fromthe directors, as on March 31, 2010 and taken on recordby the Board of Directors, none of the directors isdisqualified as on March 31, 2010 from being appointedas a director in terms of clause (g) of sub-section (1) ofSection 274 of the Act;

f. In our opinion and to the best of our information andaccording to the explanations given to us, the saidfinancial statements together with the notes thereonand attached thereto, subject to the effect on thefinancial statements of the matter referred to in theparagraph 4 above, give in the prescribed manner, theinformation required by the Act, and give a true and fairview in conformity with the accounting principlesgenerally accepted in India:i. in the case of the Balance Sheet, of the state of

affairs of the Company as at March 31, 2010; ii. in the case of the Profit and Loss Account, of the

reported profit for the year ended on that date; andiii. in the case of the Cash Flow Statement, of the cash

flows for the year ended on that date.For Price Waterhouse

Chartered AccountantsFirm Registration No.: 301112E

Vilas Y. RanePartner

Mumbai, May 25, 2010 Membership No.: F 33220

[Referred to in paragraph 3 of the Auditors’ Report of even date to the members of Apar Industries Limited on the financialstatements for the year ended March 31, 2010]

1) a) The Company is maintaining proper records showingfull particulars, including quantitative details andsituation, of fixed assets.

b) The fixed assets are physically verified by theManagement according to a phased programmedesigned to cover all the items over a period of threeyears, in our opinion, is reasonable having regard to thesize of the Company and the nature of its assets.Pursuant to the programme, a portion of fixed assetshas been physically verified by the management duringthe year and no material discrepancies between thebook records and the physical inventory have beennoticed.

c) In our opinion and according to the information andexplanations given to us, a substantial part of fixedassets has not been disposed off by the Companyduring the year.

2) a) The inventory (excluding stocks with third parties) hasbeen physically verified by the Management during theyear. In respect of inventory lying with third parties,these have substantially been confirmed by them. In ouropinion, the frequency of verification is reasonable.

b) In our opinion, the procedures of physical verification ofinventory followed by the Management are reasonableand adequate in relation to the size of the Companyand the nature of its business.

c) On the basis of our examination of the inventoryrecords, in our opinion, the Company is maintainingproper records of inventory. The discrepancies noticedon physical verification of inventory as compared tobook records were not material.

3) a) The Company has not granted loans, secured orunsecured, to Companies, firms or other parties coveredin the register maintained under Section 301of the Act.Accordingly, the provisions of sub clause (b) to (d) ofclause (iii) of paragraph 4 of the Order are notapplicable.

b) The Company has taken unsecured loans from thirteenparties covered in the register maintained under Section301 of the Act. The aggregate of the maximum amountof the loans outstanding during the year, and theaggregate of the year-end balances of such loans wasRs. 598,321,594 and Rs. 250,653,157 respectively.

c) In our opinion, and according to the information andexplanations given to us, the rate of interest and otherterms and conditions of the loans taken by theCompany are, prima facie, not prejudicial to theinterests of the Company.

d) In our opinion, and according to the information andexplanations given to us, the Company is regular inrepayment of principal and interest, where stipulationshave been made. In cases where there are nostipulations and repayment of both principal andinterest are stated at call, the Company is regular in thepayment of principal and interest as and whendemanded.

4) In our opinion and according to the information andexplanations given to us, there is an adequate internalcontrol system commensurate with the size of theCompany and the nature of its business for the purchaseof inventory, fixed assets and for the sale of goods andservices. Further, on the basis of our examination of thebooks and records of the Company, and according to theinformation and explanations given to us, no majorweakness have been noticed or reported.

5) a) In our opinion and according to the information andexplanations given to us, the particulars of contracts orarrangements referred to in Section 301 of the Act havebeen entered in the register required to be maintainedunder that section.

b) In our opinion and according to the information andexplanations given to us, there are no transactionsmade in pursuance of such contracts or arrangementsand exceeding Rs. five lakhs in respect of any partyduring the year, which have been made at prices whichare not reasonable having regard to the prevailingmarket prices at the relevant time.

6) In our opinion and according to the information andexplanations given to us, the Company has complied withthe directives issued by the Reserve Bank of India and theprovisions of Sections 58A and 58AA or any other relevantprovisions of the Act and the Companies (Acceptance ofDeposits) Rules, 1975 with regard to the deposits acceptedfrom the public. According to the information andexplanations given to us, no Order has been passed by theCompany Law Board or National Company Law Tribunalor Reserve Bank of India or any Court or any other Tribunal

Annexure to the Auditors’ Report


Nature of the Nature of dues* Amount under Period to which Forum where dispute Statute dispute and unpaid the amount relates is pending

(Rs.)44,507,841 1999 - 00 to 2001-02 Bombay High Court,

against the Order of Settlement Commission

18,767,127 2004-05 to 2006-07 Commissioner (Appeals)23,118,932 1999-00, 2001-02 Customs, Excise and

Service Tax Appellate Tribunal

1,694,484 2003-04 to 2006-07 Customs, Excise and Service Tax Appellate Tribunal

925,851 1993-94 DGFT, Mumbai1,984,896 1996-97 to 1998-99 Customs, Excise and Service

Tax Appellate Tribunal1,205,837 1998-99, 2001-02 to Assistant Commissioner

2004-0560,204 2003-04 and 2004-05 Commercial Tax Officer83,181 1998-99 Tribunal54,492,862 2002-03, 2003-04 & Commissioner-VAT

2004-05201,742 2003-04 to 2007-08 Commissioner Income Tax

(Appeals)

on the Company in respect of the aforesaid deposits.7) In our opinion, the Company has an internal audit system

commensurate with its size and nature of its business.8) We have broadly reviewed the books of account

maintained by the Company in respect of products where,pursuant to the Rules made by the Central Government ofIndia, the maintenance of cost records has been prescribedunder clause (d) of sub-section (1) of Section 209 of theAct, and are of the opinion that prima facie, the prescribedaccounts and records have been made and maintained.We have not, however, made a detailed examination ofthe records with a view to determine whether they areaccurate or complete.

9) a) According to the information and explanations given to

us and the records of the Company examined by us, inour opinion, the Company is generally regular indepositing undisputed statutory dues includingprovident fund, employees’ state insurance, income-tax,sales tax, wealth tax, service tax, customs duty, exciseduty, cess and other material statutory dues asapplicable with the appropriate authorities.

b) According to the information and explanations given tous and the records of the Company examined by us,there are no dues of wealth tax and cess which havenot been deposited on account of any dispute, and theparticulars of excise duty, sales tax, customs duty,income-tax and service tax as at 31st March, 2010which have not been deposited on account of a disputeare as follows:

*including interest and penalty, as applicable

10. The Company has no accumulated losses as at 31st March,2010, and has not incurred any cash losses in the financialyear ended on that date or in the immediately precedingfinancial year.

11. According to the records of the Company examined by usand the information and explanations given to us, theCompany has not defaulted in repayment of dues to anyfinancial institution or bank or debenture holders as at thebalance sheet date.

12. The Company has not granted any loans and advances onthe basis of security by way of pledge of shares, debenturesand other securities.

13. The provisions of any special statute applicable to chit fund/ nidhi / mutual benefit fund / societies are not applicableto the Company.

14. In our opinion, the Company is not a dealer or trader inshares, securities, debentures and other investments.

15. In our opinion and according to the information andexplanations given to us, the terms and conditions of theguarantees given by the Company, for loans taken byothers from banks or financial institutions during the year,are not prejudicial to the interest of the Company.

16. In our opinion, and according to the information andexplanations given to us, on an overall basis, the term loanshave been applied for the purposes for which they wereobtained.

17. On the basis of an overall examination of the balance sheetof the Company, in our opinion and according to theinformation and explanations given to us, there are nofunds raised on a short-term basis which have been usedfor long-term investment.

18. The Company has not made any preferential allotment ofshares to parties and companies covered in the registermaintained under Section 301 of the Act during the year.

19. The Company has not issued any debentures during theyear.

20. The Company has not raised any money by public issueduring the year.

21. During the course of our examination of the books andrecords of the Company, carried out in accordance withthe generally accepted auditing practices in India, andaccording to the information and explanations given to us,we have neither come across any instance of fraud on orby the Company, noticed or reported during the year, norhave we been informed of such case by the Management.


Firm Registration No.: 301112E



The CentralExcise Act, 1944The Finance Act,1994 – Servicetax and CustomsAct, 1962

Excise duty, Service tax and Customs duty

Central Sales TaxAct and LocalSales Tax Acts

Sales tax

Income Tax Act,1961

Tax Deducted AtSource


Balance Sheet As at March 31, 2010 (Amount in Rupees)Schedule As at 31.03.2010 As at 31.03.2009

SOURCES OF FUNDSShareholders' FundsShare Capital 1 323,360,310 323,360,310Reserves and Surplus 2 2,606,478,302 2,489,185,132

2,929,838,612 2,812,545,442 Loan FundsSecured loans 3 574,547,033 376,325,472 Unsecured loans 4 302,508,157 392,845,382

877,055,190 769,170,854 Deferred taxation liability (Net) 5 80,319,908 85,781,796

3,887,213,710 3,667,498,092 APPLICATION OF FUNDSFixed Assets 6 Gross block 1,797,823,482 1,671,961,751 Less: Depreciation 599,044,910 486,256,190 Net block 1,198,778,572 1,185,705,561 Capital work-in-progress/ advances 9,244,166 46,032,977Fixed Assets held for sale/ disposal 731,928 731,928

1,208,754,666 1,232,470,466 Investments 7 317,507,978 884,096,176 Current Assets, Loans and AdvancesInventories 8 3,782,880,460 2,974,903,798 Sundry debtors 9 3,784,270,398 4,751,894,511 Cash and bank balances 10 4,691,144,987 5,996,982,699 Loans and advances 11 2,047,919,486 1,667,558,696

14,306,215,331 15,391,339,704 Less: Current Liabilities and ProvisionsCurrent liabilities 12 11,735,743,107 13,835,016,357 Provisions 13 209,521,158 16,953,589

11,945,264,265 13,851,969,946 Net Current Assets 2,360,951,066 1,539,369,758 Miscellaneous expenditure (to the extent 14 – 11,561,692 not written off or adjusted)

3,887,213,710 3,667,498,092Significant Accounting Policies 21 Notes to the Financial Statements 22, 23

(Amount in Rupees)Schedule 2009-2010 2008-2009

INCOMESale of goods, services and related recoveries 15 21,675,561,475 26,892,586,235 Less: Excise Duty 1,695,018,777 2,258,458,836

19,980,542,698 24,634,127,399Other income 16 166,385,829 63,230,291

20,146,928,527 24,697,357,690EXPENDITUREOperating and other expenses 17 18,974,103,833 24,161,861,032 Decrease / (Increase) in stocks 18 (212,282,284) 11,469,500 Depreciation 118,791,962 109,925,885 Interest and discounting charges (net) 19 195,598,616 312,489,446

19,076,212,127 24,595,745,863 Profit before taxation and exceptional items 1,070,716,400 101,611,827 Exceptional items 20 22,611,692 17,401,870 Profit before taxation 1,048,104,708 84,209,957 Provision for taxation:Current tax 192,000,000 – Minimum alternate tax – 2,350,000 Minimum alternate tax credit entitlement – (2,350,000)Deferred tax – (credit)/charge (5,461,889) 29,945,610 Fringe benefit tax – 4,500,000 Prior period tax – (3,510,504)Wealth tax 200,000 200,000 Profit after taxation and before extraordinary items for the year 861,366,597 53,074,851Extraordinary items (net of tax) - Impairment of Equity investment in Uniflex Cables Limited (Refer Note 8 of Schedule 22) 555,538,198 – Profit after taxation and extraordinary items for the year 305,828,399 53,074,851Balance of profit brought forward 998,166,339 945,091,488 Amount available for appropriations 1,303,994,738 998,166,339 Appropriated as under:Transfer to general reserve (87,500,000) – Proposed dividend:On Equity Shares @ Rs. 5 per share (Previous year Rs. Nil per share) (161,680,155) – Tax on dividends (26,855,074) – Balance Carried to Balance Sheet 1,027,959,509 998,166,339Significant Accounting Policies 21 Notes to the Financial Statements 22, 23Earnings Per Share (Refer Note 15 of Schedule 22) face value of Rs.10Basic & Diluted before extraordinary items 26.64 1.64Basic & Diluted after extraordinary items 9.46 1.64Signatures to the Profit and Loss Account and Schedules 15 to 20, 21 to 23As per our report of even date attachedFor Price Waterhouse For and on behalf of the Board of DirectorsChartered AccountantsFirm Registration No.: 301112E

Vilas Y. Rane Kushal N. Desai H. N. Shah V. C. Diwadkar Sanjaya R. KunderPartner Managing Director & Director Chief Financial Officer Company SecretaryMembership No. F 33220 Chief Executive OfficerPlace : MumbaiDated : May 25, 2010

Signatures to the Balance Sheet and Schedules 1 to 14, 21 to 23As per our report of even date attachedFor Price Waterhouse For and on behalf of the Board of DirectorsChartered AccountantsFirm Registration No.: 301112E


Profit and Loss Account For the year ended March 31, 2010

Schedules annexed to and forming part of the Balance SheetSchedules annexed to and forming part of the Balance Sheet


(Amount in Rupees)As at 31.03.2010 As at 31.03.2009

(A) Authorised :91,998,750 (91,998,750) Equity Shares of Rs.10 each 919,987,500 919,987,500

919,987,500 919,987,500 (B) Issued, Subscribed and Fully Paid Up :32,336,031 (32,336,031) Equity Shares of Rs.10 each fully paid 323,360,310 323,360,310

323,360,310 323,360,310

Schedule 1 SHARE CAPITAL


Deferred tax liability arising on account of timing difference in:Book and Tax depreciation 109,980,856 110,945,744Less: Deferred tax asset arising on account of timing differences in :

i) Provision for doubtful debts and advances 12,403,868 9,565,232 ii) Provision for gratuity and leave salary 6,490,728 5,762,797 iii) Voluntary Retirement Scheme 2,290,269 1,714,008 iv) Expenses allowable on payment basis 8,476,083 8,121,911

29,660,948 25,163,94880,319,908 85,781,796

Schedule 5 DEFERRED TAX LIABILITY (NET)

Capital ReserveAs per last balance sheet 4,950,746 4,950,746 Capital Redemption ReserveAs per last Balance Sheet 147,547,770 147,547,770 Securities Premium AccountAs per last balance sheet 588,520,277 588,520,277 General ReserveAs per last balance sheet 750,000,000 750,000,000 Add :- Transfer from Profit and Loss Account 87,500,000 –

837,500,000 750,000,000Surplus in Profit and Loss Account 1,027,959,509 998,166,339

2,606,478,302 2,489,185,132

Schedule 2 RESERVES AND SURPLUS

Fixed Deposits*a) From public 198,080,000 143,912,500 b) From directors 45,100,000 46,100,000

243,180,000 190,012,500 Loans from Directors (repayable at call) 19,500,000 160,170,577 Inter Corporate Deposits (repayable at call) 39,828,157 42,662,305

302,508,157 392,845,382 *Repayable within one year Rs. 77,527,000 (Previous year Rs.118,966,500)

Schedule 4 UNSECURED LOANS

From Banks :i) Cash Credit/Working Capital Demand Loans 453,307,984 246,007,472 ii) Term Loans 121,239,049 130,318,000

574,547,033 376,325,472Notes:A) The Cash Credit/Working Capital Demand Loans/Pre-shipment Export Finance from banks are secured by:

i) Hypothecation of specified stocks, specified book debts of the Company and movable plant and machinery at NalagarhUnit.

ii) first charge by way of equitable mortgage by deposit of title deeds of Company's specified immovables properties, bothpresent and future.

iii) first charge by way of equitable mortgage by deposit of title deeds of certain immovables properties of Apar CorporationPrivate Limited, a related party.

iv) Out of the above an amount of Rs. 269,460,000 (Previous year Rs. NIL) is secured by lien on term deposit of Rs. 290,000,000.B) The term loan is secured by hypothecation of specific machineries acquired out of proceeds of the loan. The amount payable

within a year Rs. 30,307,741 (Previous year Rs. 130,318,000).

Schedule 3 SECURED LOANS

GROSS BLOCK DEPRECIATION WRITTEN DOWN VALUEAs at Additions Deductions/ As at Upto Deductions/ For the Upto As at As at

01.04.2009 Adjustments 31.03.2010 31.03.2009 Adjustments year 31.03.2010 31.03.2010 31.03.2009Land

– Freehold 42,388,743 – – 42,388,743 – – – – 42,388,743 42,388,743 – Leasehold 39,026,979 – – 39,026,979 6,341,286 – 573,696 6,914,982 32,111,997 32,685,693

Buildings 395,935,225 16,637,398 – 412,572,623 69,120,685 – 17,795,450 86,916,135 325,656,488 326,814,540 Plant and Machinery * 1,033,391,061 106,811,586 (6,481,901) 1,133,720,746 312,506,058 (4,560,724) 83,370,164 391,315,498 742,405,248 720,885,003 Furniture, fixture and equipments 102,485,711 4,079,431 (290,893) 106,274,249 74,629,455 (125,685) 7,458,437 81,962,207 24,312,042 27,856,256Motor Vehicles 32,190,148 5,679,751 (1,649,269) 36,220,630 17,022,735 (1,316,833) 4,267,511 19,973,413 16,247,217 15,167,413 Intangible Asset 26,543,884 1,075,628 – 27,619,512 6,635,971 – 5,326,704 11,962,675 15,656,837 19,907,913

1,671,961,751 134,283,794 (8,422,063) 1,797,823,482 486,256,190 (6,003,242) 118,791,962 599,044,910 1,198,778,572 1,185,705,561 Previous year 1,460,690,905 235,279,755 (24,008,909) 1,671,961,751 394,552,725 (18,222,420) 109,925,885 486,256,190 1,185,705,561 –Fixed Assets held for Sales/disposal (at estimated net realisable value - refer note 1 below) 731,928 731,928 Capital work-in-progress/ Advances 9,244,166 46,032,977

1,208,754,666 1,232,470,466Notes:1) Fixed Assets held for sale/disposal have been stated at lower of book value or net realisable value and include the following:

I) Land & Building Rs. 231,928 (Previous Year Rs. 231,928) II) Plant & Machinery Rs. 500,000 (Previous Year Rs. 500,000)

* Includes Asset given on Lease (Refer Note 9 of Schedule 22)

Schedule 6 FIXED ASSETS

Schedules annexed to and forming part of the Balance SheetSchedules annexed to and forming part of the Balance Sheet



Long-term, unquoted, unless otherwise statedA. Government of India Securities:

i) 6 Year National Savings Certificates 4,240 4,240 ii) 12 Year National Defence Certificates 6,000 6,000 iii) 6 Year National Savings Certificates

(held as security by Government Departments) 7,000 7,000 17,240 17,240

B. Subsidiary CompaniesIn Equity Shares:i) 100,000 (Previous year 100,000) Ordinary Shares of S$ 1 each

fully paid in Petroleum Specialities Pte Limited, Singapore 2,643,645 2,643,645ii) 1 (Previous year 1) Share of AED 150,000 each fully

paid in Poweroil Speciality Products FZE, Sharjah 1,967,274 1,967,274iii) 16,353,875 shares (Previous year 16,353,875) of –

Uniflex Cables Limited of Rs. 10 each, fully paid up (quoted) 834,371,767 834,371,767Less : Provision for Dimunition in Value (Refer Note 8 of Schedule 22) (555,538,198) –

278,833,569 834,371,767 iv) 2,600,000 Fully Convertible Warrants of Uniflex Cables

Limited (Face Value Rs. 42.50 each) Partly paid Rs. 4.25 each 11,050,000 11,050,000 Less: Lapsed during the year (11,050,000) –

– 11,050,000283,444,488 850,032,686

C. Trade:In Equity Shares:Joint Venture3,383,625 shares (Previous year 3,383,625) of Apar Chematek Lubricants Limited of Rs. 10 each, fully paid up 33,836,250 33,836,250

D. Non Trade:4,200 Shares (Previous year 4,200 Shares) of Natpur Co-operative Bank Limited of Rs. 50 each 210,000 210,000 Total 317,507,978 884,096,176

Aggregate book value of unquoted investments 38,674,409 49,724,409 Aggregate book value of quoted investments 278,833,569 834,371,767 Aggregate market value of quoted investments 278,833,569 144,731,794

Schedule 7 INVESTMENTS - (AT COST)

Face Value Unit Value(in Rs.) (in Numbers) (in Rs.)

ING Liquid Fund Institutional -Daily Dividend Option 10 45,199,170 452,256,081 Reliance Liquid Fund-Treasury Plan- Institutional Option-Daily Dividend Option 10 69,267,380 1,154,621,503 ING Liquid Fund Super Institutional -Daily Dividend Option 10 116,508,873 1,165,602,921 Kotak Liquid (Institutional Premium) -Daily Dividend 10 25,770,437 315,123,479 HDFC Liquid Fund Premium Plan-Daily Dividend Option Reinvest 10 86,805,737 997,555,444 Kotak Flexi Debt Scheme Institutional -Daily Dividend 10 7,970,046 80,079,039 Kotak Floter Short Term-Daily Dividend 10 6,773,942 72,528,048 Bharti Axa Liquid -Daily Dividend 10 2,256,970 22,512,390 Reliance Liquid Fund-Daily Dividend -Institutional Option 10 7,714,387 130,047,106 Reliance Liquid Fund-Daily Dividend -Retail Option 10 9,995 10,004,162 Reliance Money Manager Fund-Daily Dividend -Institutional Option 10 24,984 30,012,726 Kotak Floter Long Term-Daily Dividend 10 17,779,803 180,079,933 HDFC Cash Mang-Daily Div. 10 940,571 10,004,295 SBNP Ultra 10 747,478 7,502,435 SBNPP Ultra Fund-Daily Div. 10 747,443 7,502,086 32D ICICI Prud.Daily Div 10 1,790,448 20,009,833 DWS Insta Cash Daily Div 10 242,721 2,500,264


(At lower of cost and net realisable value)Stores and spare parts 80,299,795 82,709,762Raw materials and components # 2,771,627,765 2,173,523,420Work-in-progress 249,467,996 298,680,897Finished goods * 681,484,904 419,989,719

3,782,880,460 2,974,903,798# Including Raw materials in transit Rs. 1,289,489,693 (Previous year Rs. 679,137,020)* Including stock of traded goods Rs. 68,759,918 (Previous year Rs.17,442,147)

Schedule 8 INVENTORIES

Debts outstanding for a period exceeding six monthsSecuredConsidered good 317,545 233,927UnsecuredConsidered good 502,336,705 791,744,098Considered doubtful 37,338,555 19,866,313

539,992,805 811,844,338Other debts - Considered good*Secured 2,137,455 1,969,558Unsecured 3,279,478,693 3,957,946,928

3,281,616,148 3,959,916,486Less: Provision for doubtful debts 37,338,555 19,866,313 Total 3,784,270,398 4,751,894,511

Schedule 9 SUNDRY DEBTORS

Cash on hand 614,785 891,352 Fund in Transit 16,000,044 9,143,586Balances with Scheduled Banks :

in current accounts 709,675,078 1,464,086,649in cash credit accounts – 1,441,985,757in deposit accounts 19,292,672 13,879,999in margin money accounts * 3,945,331,648 3,066,764,596

4,674,299,398 5,986,717,001Balances with Non-Scheduled Banks :in current accounts** 230,760 230,760

4,691,144,987 5,996,982,699* Rs. 290,000,000 (Previous year Rs. Nil) under lien against working capital loans and balance against Letters of Credit for

Company's imports of raw materials.** Maximum balance during the year Rs. 230,760 (Previous year Rs. 230,760).

Schedule 10 CASH AND BANK BALANCES

Short term investment in liquid fund purchased and sold during the year

Balance as at Balance as at31.03.2010 31.03.2009

Poweroil Speciality Products FZE 16,373,168 11,049,471 Uniflex Cables Limited 94,553,578 81,303,705 Petroleum Specialities Pte Limited 10,724,286 6,230,037 Quantum Apar Speciality Pty. Limited – 24,550,689 Marine Cables and Wires Private Limited 2,117,167 2,117,167 Total 123,768,199 125,251,069

* Includes receivable from subsidiaries/Down stream subsidiaries:

Schedules annexed to and forming part of the Profit and Loss AccountSchedules annexed to and forming part of the Balance Sheet



Unsecured, considered good, unless otherwise statedLoans & advances to subsidiary companies * 710,295,330 134,204,021Advances recoverable in cash orin kind or for value to be received **Considered good 1,099,818,145 1,287,199,424Considered doubtful – 8,275,000

1,099,818,145 1,429,678,445Less:- Provision for doubtful advances – 8,275,000

1,099,818,145 1,421,403,445Balances with Excise Department :in current account 1,080,135 80,135Advance payments of tax less provisions 172,089,392 194,973,317Interest accrued but not due on deposits/margin monies 64,636,484 48,751,799 Mat Credit Entitlement – 2,350,000Total 2,047,919,486 1,667,558,696

Schedule 11 LOANS AND ADVANCES

(Amount in Rupees)2009–2010 2008–2009

Sales 19,730,382,311 24,859,483,374 Less: Excise duty (1,695,018,777) (2,258,458,836)

18,035,363,534 22,601,024,538 Sale of traded goods 331,545,444 422,292,260 Sale of raw materials 591,379,623 119,939,063 Scrap sales 24,236,956 26,878,540 Export benefits 143,745,708 267,332,968 Rebate/refund of excise duty on deemed/physical exports 224,750,376 791,262,013 Transport charges recovered 441,336,266 398,262,275Processing and other service charges 188,184,791 7,135,742Total 19,980,542,698 24,634,127,399

Schedule 15 SALE OF GOODS, SERVICES AND RELATED RECOVERIES (NET OF EXCISE)

Sundry creditors (Refer Note 5 of Schedule 22)– Total outstanding dues of Micro Enterprises and Small Enterprises 10,336,317 11,636,535 – Total outstanding dues of other creditors 9,427,551,757 11,938,852,279 [Includes dues to subsidiary company Rs. 10,749,864 (Previous year Rs. 36,030,821)]Other liabilities 2,268,775,172 1,833,694,794 Interest accrued but not due on loans 29,079,861 50,832,749 Total 11,735,743,107 13,835,016,357

Schedule 12 CURRENT LIABILITIES

Commission – 1,806,212 Lease Rent 8,720,667 1,995,800 Profit on sale/ disposal of fixed assets (Net) 1,481,797 3,700,692 Provision for expenses no longer required/ sundry balances, written back 10,471,935 1,835,350 Exchange gain - Others 107,842,237 – Profit on sale of short term investment in liquid fund – 1,027,749Dividend on short term investment in liquid fund 2,441,745 185,493Sundry Income 35,427,448 52,678,995 Total 166,385,829 63,230,291

Schedule 16 OTHER INCOME

Raw materials and components consumed * 15,467,184,354 20,720,809,669 Purchase of traded goods 361,686,233 415,186,855 Excise duty adjustment of finished goods stock (514,170) 2,763,450 Power, electricity and fuel 255,260,904 286,519,450 Stores, spare parts ** 59,616,833 75,523,633 Packing Material 756,793,734 710,126,788 Storage charges 57,291,333 48,584,816 Processing charges, Fabrication & Labour Charges 131,956,842 147,844,025 Repairs and maintenance :Buildings 632,508 2,073,914 Plant and machinery 12,101,319 11,546,290 Others 12,965,275 11,464,664

25,699,102 25,084,868 Insurance 29,754,759 31,279,978 Rent 14,960,038 7,731,341 Rates and taxes 31,986,647 10,743,230 Payment to and provision for employees :Salaries, wages and bonus (Refer Note 4(A) of Schedule 22) 175,690,388 154,182,795 Contribution to provident and other funds 18,684,687 17,214,509 Provision for gratuity in respect of directors 346,982 349,438 Workmen and staff welfare expenses 11,761,615 17,806,133

206,483,672 189,552,875

Schedule 17 OPERATING AND OTHER EXPENSES

Gratuity - In respect of Directors 2,273,058 1,926,076 - Balance liability to the Employees Gratuity Fund 1,447,314 964,743

Accumulated and unavailed leave 17,265,557 14,062,770 Proposed dividend 161,680,155 – Tax on proposed dividend 26,855,074 – Total 209,521,158 16,953,589

Schedule 13 PROVISIONS

Voluntary Retirement CompensationOpening Balance 11,561,692 28,963,562 Add: Incurred during the year – – Less: Amortized during the year (11,561,692) (17,401,870)

– 11,561,692 Total – 11,561,692

Schedule 14 MISCELLANEOUS EXPENDITURE (to the extent not written off or adjusted)

* Loans and advances to Balance as at Maximum amount Balance as at Maximum amountsubsidiary companies 31.03.2010 outstanding 31.03.2009 outstanding

during the year during the previous year

Poweroil Speciality Products FZE 4,567,273 4,571,860 4,571,860 4,571,860 Uniflex Cables Limited 705,686,435 940,266,616 129,466,810 613,159,920 Petroleum Specialities Pte Limited 41,622 165,351 165,351 165,351 ** Includes Rs. 3,975,095 being excise/custom duty paid under protest (Previous year Rs. 3,975,095)** Includes Rs. 6,110,417 being sales tax paid under protest (Previous year Rs. 6,110,417)

Schedules annexed to and forming part of the Financial StatementSchedules annexed to and forming part of the Profit and Loss Account


(Amount in Rupees)2009–2010 2008–2009

Directors' sitting fees 562,500 547,500 Commission to Chairman, Managing Director and Joint Managing Director (Refer Note 4(B) of Schedule 22) 20,948,661 –Lease rentals 1,344,900 1,338,300Freight outward 674,035,679 789,022,514Commission on sales 93,095,234 101,155,610Discounts and rebates 65,099,435 41,416,711Advertisement expenses 876,272 1,689,172Donations 2,747,500 259,500Legal and Professional fees 42,561,784 35,394,932Royalty 62,949,838 59,980,689Marketing fees 190,485,190 6,699,241Miscellaneous expenses 151,319,032 166,209,044Bad debts and advances written off 11,751,867 –Less: Provision for doubtful debts/advances utilised (9,275,000) –

2,476,867 –Provision for doubtful debts / advances 27,752,380 14,469,424Bank charges and commission 239,688,280 197,614,647Exchange loss - others – 74,312,770Total 18,974,103,833 24,161,861,032* net of gain on derivative contract Rs. NIL (Previous year gain of Rs. 34,531,629).** include stores and spares consumed for repairs and maintenance of plant and machinery, not separately ascertained.

Schedule 17 OPERATING AND OTHER EXPENSES (Contd...)

Opening stock of finished goods, work-in-progress and scrap 718,670,616 730,140,116 Closing stock of finished goods, work-in-progress and scrap 930,952,900 718,670,616 Total (212,282,284) 11,469,500

Schedule 18 DECREASE/(INCREASE) IN STOCKS

Amortisation of Voluntary Retirement Scheme compensation 11,561,692 17,401,870 Investment (Share Warrant) written off 11,050,000 –Total 22,611,692 17,401,870

Schedule 20 EXCEPTIONAL ITEMS

On loans for fixed periods 61,710,217 32,437,327 On other loans / facilities 445,699,722 703,307,426

507,409,939 735,744,753 Less: Interest earned- gross (tax deducted at source Rs. 58,644,621) (Previous year Rs. 86,756,218)On bank deposits * (256,475,989) (360,869,292)Others (55,335,334) (62,386,015)

(311,811,323) (423,255,307)Total 195,598,616 312,489,446* On deposits under lien against working capital and margin monies held against letters of credit for Company's import of rawmaterials.

Schedule 19 INTEREST AND DISCOUNTING CHARGES (NET)

1. Basis of Preparation of financial statements:The financial statements are prepared on accrual basis under the historical cost convention and comply in all material aspectswith the generally accepted accounting principles in India, the Accounting Standards prescribed under section 211(3C) of theCompanies Act,1956 and the applicable provisions thereof.

2. Use of estimates:The preparation of financial statements is in conformity with generally accepted accounting principles (“GAAP”) which requiresthe management of the Company to make estimates and assumptions that affect the reported amounts of assets and liabilitiesand the disclosure of contingent liabilities on the date of the financial statements. Actual results could differ from those estimates.Any revision to accounting estimates is recognized prospectively in current and future periods.

3. Significant accounting policies:A) Fixed assets, Depreciation and Amortization:

i) Fixed assets are stated at cost of acquisition / construction (net of CENVAT) less accumulated depreciation. Cost includespurchase price and other costs attributable to acquisition / construction of fixed assets.

ii) Depreciation on assets is provided at the rates and in the manner prescribed under Schedule XIV of the Companies Act,1956 (except as stated in (iii) below):a) On written down value method except in respect of building and plant and machinery purchased after 30.4.1987,

which are depreciated on straight line method.b) Capital Expenditure in respect of which ownership does not vest with the Company is amortized over a period of five

years. Leasehold land is amortized over the period of lease.c) Certain items of plant and machinery which have been considered to be continuous process plant by the management

are depreciated at the prescribed rates.iii) In the cases where the estimated useful life of the asset is less as compared to useful life estimated in Schedule XIV of

the Companies Act, 1956, such assets are depreciated at rates higher than those prescribed under Schedule XIV of theCompanies Act, 1956.Asset RateFactory building at Nalagarh Over the lease period of 8 years

iv) In respect of assets costing less than Rs.5,000 each and temporary structures, 100% depreciation is provided in the yearof addition.

v) Borrowing costs attributable to acquisition/construction of qualifying assets within the meaning of the accountingstandard 16 on “borrowing costs” are capitalised as a part of the cost of fixed assets.

vi) Pre-operation expenses including trial run expenses (net of revenue) are capitalized.B) Impairment of assets:

The Company assesses, at each balance sheet date, whether there is any indication of impairment of the carrying amountof the Company’s assets. An impairment loss is recognized in the profit and loss account wherever the carrying amount ofthe assets exceeds its estimated recoverable amount. The recoverable amount is greater of the net selling price and value inuse. In assessing value in use, the estimated future cash flows are discounted to their present value, based on an appropriatediscounting factor. Impairment losses are recognized in the profit and loss account. The impairment loss recognized in prioraccounting period is reversed if there has been change in recoverable amount.

C) Investments:All long term investments are stated at cost. Provision for diminution in value of long term investments is made if it is otherthan temporary in nature. Current investments are valued at lower of cost and market value.

D) Inventories:Inventories are valued at lower of standard cost or net realizable value. Cost includes material cost, cost of labour andattributable manufacturing overheads. Cost of materials is arrived at on weighted average basis. Inventory of scrap is valuedat estimated realisable value. Inventories of Finished Goods include excise duty as applicable.

E) Government Grants:i) Government grants are recognised in the financial statements when they are received and there is reasonable assurance

that the Company will comply with the conditions attached to them.ii) Government grants, which are in the nature of refundable interest free loans received from government/semi-government

authorities, are credited to secured/unsecured loans.iii) Government grants which are in the nature of subsidies received from government/semi-government authorities and

which are non-refundable are credited to reserves.F) Employee stock options:

In respect of the employee stock options, the excess of fair price on the date of grant over the exercise price is recognized

Schedule 21 SIGNIFICANT ACCOUNTING POLICIES

Schedules annexed to and forming part of the Financial StatementSchedules annexed to and forming part of the Financial Statement


as deferred compensation cost amortized over vesting period. G) Voluntary Retirement Schemes:

Compensations paid under voluntary retirement schemes are amortized over a period not exceeding 5 years, up to 31stMarch,2010.

H) Enterprise Resource Planning Cost:Cost of implementation of ERP Software including all related direct expenditure is amortized over a period of 5 years onsuccessful implementation.

I) Share Issue Expenses:Share issue expenses are written off against share premium account, if any, or amortized over a period of 5 years.

J) Revenue recognition:i) Sale of goods is recognised on despatch to customers and on date of shipment in case of exports. Sales exclude amounts

recovered towards sales tax and excise duty and is net of returns.ii) Price variation claims are accounted in accordance with the terms of contract and/or upon admittance by customers.iii) Dividend income on investment is recognised when the right to receive payment is established.iv) In respect of service activities, income is recognised as and when services are rendered.v) Lease rental on operating lease is accounted on accrual basis.

K) Post-employment benefits:Defined Contribution Plans: In respect of the Company’s provident fund scheme, the Company makes specified monthlycontributions towards employee provident fund directly to the Government under the Employees Provident Fund Act, 1952and is not obliged to bear the shortfall, if any, between the return on investments made by the Government from thecontributions and the notified interest rate. In respect of the Company’s approved superannuation scheme, the Companymakes specified contributions to the superannuation fund administered by the Company and the return on investments isadequate to cover the commitments under the scheme. The Company’s contribution paid/payable under these schemes isrecognized as expense in the profit and loss account during the period in which the employee renders the related service. Defined Benefit Plans: In respect of the Company’s gratuity and leave wages schemes, the present value of the obligationunder such scheme is determined based on actuarial valuation using the Projected Unit Credit Method. The discount ratesused for determining the present value of the obligation is based on the market yields on Government securities as at thebalance sheet date. Actuarial gains and losses are recognized immediately in the Profit & Loss Account. Long termcompensated absences are provided for based on actuarial valuation, made at the year end, by independent actuaries.

L) Translation of foreign currency:i) The Company translates foreign currency transactions during the year, at the conversion rates prevailing on transaction

dates.ii) Monetary items remaining unsettled at the year end are translated / reported at the year end rate. Exchange differences

arising on such revaluation are recognised in the Profit and Loss Account. iii) Non-Monetary items (other than fixed assets) are reported at the exchange rate at which they are accounted.iv) In case of forward contracts, premium on the forward contracts is recognized as income or expense over the life of the

contract. M) Hedging transactions (Metals):

All gains or losses in respect of hedging transactions are recognised in the financial statements on settlement/squaring off.Commission etc. in respect of such transactions is accounted on accrual basis.

N) Export benefits/Incentives:The Company accounts for excise duty rebate on deemed and physical exports, duty entitlements and Focus benefits onphysical exports on accrual basis. Premium on special import licence is credited in the accounts as and when realised. Thebenefits in the form of entitlements to Advance Licenses for duty free import of raw materials in respect of exports madeare accounted when such imports are made.

O) Claims against the Company not acknowledged as debts:The demands under disputed showcause notices / orders of statutory authorities are provided in the accounts on the basisof management's estimate and the balance, if any, are included in contingent liability.

P) Taxes on income:Provision for taxation is made for both current and deferred taxes. Provision for current tax is made, at current rate of tax,based on assessable income. Deferred tax resulting from timing differences between the book profits and the tax profits isaccounted for to the extent that the timing differences are expected to crystallize. Deferred tax assets are not recognised on unabsorbed depreciation and carry forward losses unless there is virtual certaintythat sufficient future taxable income will be available against which such deferred tax assets will be realized.

Schedule 21 SIGNIFICANT ACCOUNTING POLICIES (Contd...)Q) Provision for contingencies:

A provision is recognized when there is a present obligation as a result of a past event, it is probable that an outflow ofresources will be required to settle the obligation and in respect of which reliable estimates can be made. Disclosure ofcontingent liability is made when there is a possible obligation or a present obligation that may but probably will not requirean outflow of resources. When likelihood of such outflow is remote, no provision or disclosure is made. Provision arising fromlitigations, assessments by statutory authorities, etc. is made when the Company, based on legal advise wherever necessary,estimates that the liability has been incurred and the amount can be reasonably estimated.

Schedule 21 SIGNIFICANT ACCOUNTING POLICIES (Contd...)


1. Contingent liabilities not provided for :a) Bills of exchange discounted 1,311,439,622 1,584,082,553 b) Taxation:

Disputed demands of income tax – 210,742 c) i) Guarantee given by the Company for credit facilities enjoyed by Petroleum

Specialities PTE Ltd., a Wholly Owned Subsidiary 673,650,000 354,620,000ii) Guarantee given by the Company for credit facilities enjoyed by

Uniflex Cables Limited, a subsidiary company. 1,250,000,000 1,250,000,000 d) Claims against the Company not acknowledged as debts -

i) Demand/ Show cause-cum-demand notices received and contested by the Company with the relevant appellate authorities:Excise Duty (also refer note (iii) below) 36,817,515 3,433,948 Service Tax 1,984,896 1,984,896 Customs duty 31,004,925 31,004,925 Sales tax 56,012,976 59,080,673

ii) Arbitration award regarding dispute of alleged contractual non performance by the Company, against which the Company is in appeal before Bombay High Court. 65,631,906 61,048,671

iii) Interest on delayed payment of Excise duty, (which duty payment was revenue neutral) on certain Deemed Exports as per settlement commission's order against which the Company is in appeal before Bombay High Court. 44,507,841 44,507,841

iv) Demand/ charges levied by the Local Authorities – 2,000,000 v) Labour matters 16,431,439 16,431,439

Schedule 22 NOTES TO THE FINANCIAL STATEMENTS

As at 31.03.2010 As at 31.03.20092. Estimated amount of contracts remaining to be

executed on capital account and not provided for (Net of advances) 5,067,466 5,520,244

As at 31.03.2010 As at 31.03.20093. A) Auditors' remuneration (excluding service tax):

i) For Audit fees 2,900,000 2,900,000 ii) Other services 1,100,000 100,000 iii) Out of pocket expenses 94,000 22,100

4,094,000 3,022,100 B) Cost auditors' remuneration (excluding service tax):

i) For Audit fees 40,000 65,000 ii) Out of pocket expenses – –

40,000 65,000




4. Payment to directors :A. Remuneration to directors

Directors' sitting fees 562,500 547,500 Salaries and other benefits / amenities* 12,517,474 5,643,059 Provision for gratuity (ascertained on arithmetical basis) 346,982 349,438 Commission to Chairman, Managing Director & Joint Managing Director 20,948,661 –

34,375,617 6,539,997 Notes:In the case of personal use of Company's cars, recoveries have been made from the Directors on the basis of the Income-tax Rules, 1962, which the Company considers as adequate and reasonable.*Includes Rs. 3,329,423 in respect of previous year.

B. Computation of net profit under Section 198 of the Companies Act, 1956 and commission payable to the directors:Net profit before tax as per profit and loss account 1,048,104,710 84,209,957 Add: Depreciation charged in accounts 118,791,962 109,925,885 Directors' remuneration (other than commission) 13,426,956 6,539,997 Provision for bad debts / advances (adjusted for provisions utilised / written back) 18,477,380 14,469,424 Share warrant application money lapsed 11,050,000 – Directors' commission 20,948,661 –

182,694,959 130,935,306 1,230,799,669 215,145,262

Less: Depreciation as per Section 350 118,791,962 109,925,885 Wealth-tax for the year 200,000 200,000 Profit on sale of Investments and Dividend 2,441,745 1,213,242

121,433,707 111,339,126 Net profit as per Section 198 of the Companies Act, 1956 1,109,365,962 103,806,137 Commission upto 1% to each of Chairman, Managing Director andJoint Managing Director * –* The Company considers it prudent that Commision to Chairman, Managing Director and Joint Managing Director for

this financial year be restricted to Rs. 20,948,661 (0.63% each) in view of Note No. 7A of this Schedule.

Schedule 22 NOTES TO THE FINANCIAL STATEMENTS (Contd...) Schedule 22 NOTES TO THE FINANCIAL STATEMENTS (Contd...)

2009–2010 2008–2009a) i) Delayed payments due - Principal amount 96,035 1,537,851

ii) Interest due on the above 1,178 18,251 b) Total interest paid on all delayed payments during the

year under the provision of the Act – – c) Interest due on principal amounts paid beyond the due date during

the year but without the interest amounts under this Act 18,251 1,390 d) Interest accrued but not due – – e) Total interest due but not paid 1,178 18,251 The above information and that given in Schedule "12" - Current Liabilities regarding micro enterprises and small enterprises hasbeen determined on the basis of information available with the Company.

5. Disclosure required under the Micro, Small and Medium Enterprises Development Act, 2006 are given as follows:

Defined Benefit PlanThe employees' gratuity fund scheme managed by a Trust is a defined benefit plan. The present value of obligation is determinedbased on actuarial valuation using the Projected Unit Credit Method, which recognises each period of service as giving rise toadditional unit of employee benefit entitlement and measures each unit separately to build up the final obligation. The obligationfor leave encashment is recognized in the same manner as gratuity.

6. As per the Revised Accounting Standard 15 " Employees Benefits", the disclosure of employee benefits as defined in theAccounting Standard are given below : (Amount in Rupees)

2009–2010 2008–2009Defined Contribution PlanContributions to Defined Contribution Plan, recognised as expense for the year are as under:Employer's Contribution to Government managed Provident Fund and Family Pension Fund 9,628,897 8,692,975Employer's Contribution to Superannuation Fund 4,891,430 4,380,197

i) Changes in Defined Benefit Obligation during the year (Amount in Rupees)2009–10 2008–09

Gratuity Leave Gratuity Leave encashment encashment

(Funded) (Unfunded) (Funded) (Unfunded)Defined Benefit obligation at beginning of the year 27,416,902 14,062,770 *22,871,510 10,087,652 Current Service Cost 2,217,256 1,347,281 1,684,669 833,305 Interest Cost 2,208,736 1,057,281 1,908,221 779,839 Actuarial (gain) / loss 1,586,963 3,424,161 2,359,332 4,707,925 Benefits paid (368,702) (2,625,936) (1,406,830) (2,345,951)Defined Benefit obligation at end of the year 33,061,155 17,265,557 27,416,902 14,062,770 * excludes fund aggregating Rs. 7,361,301 in respect of Polymer business sold in the F.Y 2007-08, transferred to a recognised Gratuity fund of buyer in F.Y 2009-10.ii) Changes in fair value of Plan Assets (Amount in Rupees)

2009–10 2008–09Gratuity Leave Gratuity Leave

encashment encashment(Funded) (Unfunded) (Funded) (Unfunded)

Fair value of plan assets at beginning of the year 26,452,159 *22,871,510 Expected return on plan assets 2,368,709 1,993,242 Actuarial gain / (loss) (179,377) 246,777 Employer Contribution 3,341,052 2,625,936 2,747,460 2,345,951 Benefit paid (368,702) (2,625,936) (1,406,830) (2,345,951)Fair value of plan assets at year end 31,613,841 26,452,159 Actual return on plan assets 2,189,332 2,240,019 * excludes fund aggregating Rs. 7,361,301 in respect of Polymer business sold in the F.Y 2007-08, transferred to a recognised Gratuity fund of buyer in F.Y 2009-10.iii) Net Asset/ (Liability) recognised in the Balance Sheet as at March 31, 2010 (Amount in Rupees)



Fair Value of plan assets 31,613,841 – 26,452,159 – Present value of obligation 33,061,155 17,265,557 27,416,902 14,062,770 Amount recognised in Balance Sheet 1,447,314 17,265,557 964,743 14,062,770



Schedule 22 NOTES TO THE FINANCIAL STATEMENTS (Contd...) Schedule 22 NOTES TO THE FINANCIAL STATEMENTS (Contd...)iv) Expense recognised during the year (Amount in Rupees)



Current Service Cost 2,217,256 1,347,281 1,684,669 833,305 Interest Cost 2,208,736 1,057,281 1,908,221 779,839 Expected return on plan assets (2,368,709) – (1,993,242) – Net Actuarial (gain) / loss 1,766,340 3,424,161 2,112,555 4,707,925 Net Cost 3,823,623 5,828,723 3,712,203 6,321,069v) Actuarial Assumptions (Amount in Rupees)

(Amount in Rupees)

Gratuity Leave Gratuity Leave encashment encashment

(Funded) (Unfunded) (Funded) (Unfunded)Mortality Table (LIC) 1994-96 1994-96 1994-96 1994-96

(Ultimate) (Ultimate) (Ultimate) (Ultimate) Discount rate (per annum) 7.5% 7.5% 7.5% 7.5%Expected rate of return on plan assets (per annum) 8% – 8% –Rate of escalation in salary (per annum) 5% 5% 5% 5%Attrition rate 2% 2% 2% 2%

vi) Broad Category of Plan Assets relating to Gratuity on a percentage of total Plan AssetsParticulars 2009–10 2008–09

Percentage (%) Percentage (%)Public Securities 0.93 0.73 Special Deposit Schemes 11.61 9.11 State Govt. Securities 0.47 0.37 Private Sector Securities 87.00 68.33 Fixed Deposit with bank 0.00 7.28 Others (including bank balances) 0.00 14.18

100.00 100.00The estimates of rate of escalation in salary considered in actuarial valuation, take into account inflation, seniority, promotionsand other relevant factors including supply and demand in the employment market. The above information is certified by theindependent actuary.The expected rate of return on plan asset is determined considering several applicable factors, mainly the composition of planassets held, assessed risks, historical results of return on plan assets and the Company's policy for plan asset management.

7. I) Category wise quantitative data about derivative instruments outstanding as at March 31, 2010

7A. The Company has entered into non-speculative commodity forward contract in order to hedge its exposure to fluctuations inthe metal prices against requisite firm price sales contracts (received / to be received) for its conductor segment. The mark tomarket loss on such contracts, in accordance with the announcement dated March 28, 2008, issued by the Institute of CharteredAccountants of India, amounting to Rs. 400,027,218 as at March 31, 2010 (Rs. 1,713,236,466 as at March 31, 2009), has notbeen provided in the Accounts, as in the opinion of the management such loss is notional in nature and the said loss would getextinguised on excecution of firm sale price orders corresponding to these commodity forward contracts.

8. The Company has an equity investment of Rs. 834,371,767 in Uniflex Cables Limited , a subsidiary company ("UCL"). UCL hastaken various steps to improve its productivity, debottlenecking of manufacturing facility, expansion of production line andmarkets, strengthening of managerial resources etc. and losses incurred by the UCL are reducing gradually. However, in viewof the continuous loss and erosion of its net worth the Company has provided Rs. 555,538,198 in 2009 -2010 accounts forimpairment of equity investment in UCL as an Extraordinary item. The loans & advances and Debtors aggregating to Rs. 800,240,013 (Previous Year Rs. 210,770,515) are considered good.

Type of Instrument Nos. Mt. Amount $/Euro Amount INRa). In respect of Commodity

Futures/ Options at London Metal 89 14,161 39,913,064 1,792,495,700 Exchange (in Mt.) - USD (108) (25,100) (67,674,053) (3,428,367,512)

b). In respect of Foreign currencyForward contracts - buy contracts - USD 84 143,041,125 6,423,976,916

(62) (146,327,135) (7,412,932,659)Forward contracts - sale contracts - EURO – – –

(1) (500,000) (33,714,000)Currency Swap – EURO/USD – EURO 2 1,700,000 102,795,600

(10) (12,965,000) (874,204,020)Options-USD – – –

(1) (6,000,000) (303,960,000)II) All the derivative instruments entered by the Company

during the year were for hedging purpose and not for any speculative purpose.

III) Unhedged foreign currency exposureas at 31st March, 2010In US $ - Payable (Net) 24,452,642 1,098,168,172

(25,427,656) (1,288,165,028)In Euro - Payable (Net) 1,850,385 111,889,081

(3,283,577) (221,405,012)IV) Premium in case of forward contracts not expired – 44,357,855

and pertaining to the future period – (49,427,415)(Figures in bracket are for year ended 31.03.2009)

9. Disclosure of significant leasing arrangements as required by Accounting Standard (AS) 19 'Leases' in respect ofmachineries given on Operating lease to Uniflex Cables Limited

Particulars 2009–10 2008–09i) Operating lease income recognised in the Profit and Loss Account 8,720,667 1,995,800 ii) Depreciation recognised in the Profit and Loss Account includes a charge on

account of assets given on operating lease. 3,245,454 203,432 iii) Future minimum lease income under non-cancellable agreements

Not later than one year 10,164,000 5,924,000 Later than one year and not later than five years 30,075,666 21,836,333 Later than five years – –



iv) The following are the assets given on operating lease

v) Significant leasing arrangementsThe agreements provide for early termination by the Company after giving six month's notice and restricted to sub-lease.Assets are given on lease for a period of five years.

(Amount in Rupees)

(Amount in Rupees)

As at 31.03.2010 As at 31.03.2009Gross Block Accumulated Gross Block Accumulated

Depreciation DepreciationMachinery & Equipment 56,345,146 3,448,886 32,900,000 203,432

Schedule 22 NOTES TO THE FINANCIAL STATEMENTS (Contd...) Schedule 22 NOTES TO THE FINANCIAL STATEMENTS (Contd...)

10. The Company's share of each of assets, liabilities, income and expenses etc. related to its interest in "Apar ChematekLubricants Limited" a 50:50 Joint Venture Company based on the audited financial statement are as under:

Particulars As at 31.03.2010 As at 31.03.2009I. Assets

1. Fixed Assets 1,542,767 1,414,332 2. Investments – –3. Deferred Tax (Liability)/ Asset (Net) (36,151) 13,092,116 4. Current Assets, Loans and Advances

a) Sundry Debtors 23,342,729 – b) Cash and Bank Balances 3,451,029 1,935,764 c) Loans and Advances 13,646,816 3,338,966

II Liabilities1. Shareholders' Funds including Reserves and Surplus (32,893,792) (7,901,978)2. Loans – (3,500,000)3. Current Liabilities and Provisions

a) Liabilities (8,124,068) (7,922,038)b) Provisions (929,330) (457,161)

(Amount in Rupees)Particulars For the Year ended For the Year ended

31.03.2010 31.03.2009III Income

1. Service income 95,242,596 3,349,621 2. Misc. Income 191,805 –

IV Expenses1. Operating and other expenses (55,726,974) (34,413,502)2. Depreciation (437,680) (295,420)3. Interest (1,149,668) (280,377)4. Profit before taxation 38,120,080 (31,639,679)5. Provision for taxation (including MAT, deferred taxation and fringe benefit tax) (13,128,267) 10,868,372 6. Net profit 24,991,814 (20,771,307)

V Other matters1. Contingent Liabilities – – 2. Capital Commitments – –

11.The Compensation Committee of Directors (CCD) of the Company, at its meeting held on May 27, 2008 have granted175,150 options at an exercise price of Rs. 207.05 per option to eligible employees/Directors. The above options will vest inthree installments (1/3rd each) on May 27, 2009, May 27, 2010 & May 27, 2011 respectively. As of date no employee hasexcercised any options. The Company has obtained in-principle approval for the listing of the entire 1,616,802 equity shares tobe issued and allotted on excercise of options as & when excercised under the scheme.

12.The exchange rate differences arising on purchases/vendor balances and those on account of sales/receivables have been groupedunder 'Raw Material Consumed' and 'Sales' respectively. Similarly exchange rate differences on other transactions have beenshown under 'Other Expenses' or 'Other Income', as the case may be. The net exchange difference gain so grouped, for the yearis Rs. 187,456,828 (Previous Year loss of Rs.1,290,049,119).

13.Related party disclosuresA. List of Related Parties

a) Subsidiary Companies:1) Petroleum Specialties Pte. Limited, Singapore2) Power Oil Specialities Pte. FZE ,Sharjah3) Quantum Apar Speciality Oil Pty. Ltd (Subsidiary of Petroleum Specialties Pte. Limited)4) Uniflex Cables Limited5) Marine Cables & Wires Private Limited (Subsidiary of Uniflex Cables Limited)

b) Joint Venture Company:Apar Chematek Lubricants Limited

c) Key Managerial Personnel:Mr K. N. Desai - Managing DirectorMr C. N. Desai - Jt. Managing Director

d) Chairman having significant influence:Dr N. D. Desai - Non executive Chairman

e) Relatives of Key Managerial PersonnelMrs Noopur Kushal DesaiMrs Vineeta R. SrivastavaMr Rishabh K. DesaiMrs Jinisha C. DesaiMs Gaurangi K. Desai Mrs M. N. DesaiMr Rajeev SrivastavaMr Devharsh C. DesaiMs Krishangi R. SrivastavaKum. Nikita C. Desai

f) Entities over which significant influence is exercised by key management personnel/individuals having significantinfluence:Apar Corporation Private Limited Kushal Chaitanya Desai Family TrustScope Private Limited & its' subsidiaries, viz Chaitanya N. Desai Family Trusta). Apar Investment ( Singapore ) Pte. Limited Catalis World Private Limitedb). Apar Investment Inc. Apar Masat Conductors LimitedKushal N. Desai Family Trust Gayatri AssociatesApar Technologies Private Limited



Schedule 22 NOTES TO THE FINANCIAL STATEMENTS (Contd...) Schedule 22 NOTES TO THE FINANCIAL STATEMENTS (Contd...)B. Related Party Transactions

i) Subsidiary Companies: (Amount in Rupees)Sr. No. Transactions 2009–10 2008–091 Purchase of Raw Material 684,293,701 1,019,417,357 2 Sale of Finished goods/ Raw Material 442,869,559 293,706,724 3 Sale of Capital goods 3,586,585 10,201,354 4 Cost of Lease Assets 23,445,146 32,900,000 5 Lease Rent Received 8,720,667 1,995,800 6 Job work done for Subsidiary 4,833,698 779,856 7 Job work done by Subsidiary 12,045,015 1,301,406 8 Reimbursement received on Deputation of Manpower 10,000,000 6,568,7229 Reimbursement (received) of expenses 184,198 1,431,444 10 Interest from Uniflex Cables Ltd 43,493,307 20,839,233 11 Investment in shares – 440,238,138 12 Guarantees given by the Company on behalf of Petroleum

Specialities PTE Ltd. & Uniflex Cables Ltd 1,923,650,000 1,604,620,000 13 Security Deposit received 1,600,000 – 14 Interest on security deposit 86,575 – 15 Service Charges paid 867,823 – 16 Commission paid 1,211,355 – 17 Balance outstanding as on 31.03.2010

a) Payable to subsidiary for supply of raw materials, security deposit 12,349,864 36,030,821 b) Receivable from subsidiary company for supply of raw material,

finished goods, capital goods and services 123,768,199 125,251,069 c) Receivable from subsidiary company for advances given 710,295,330 134,204,021

ii) Joint Venture Company (Apar Chematek Lubricants Limited):Sr. No. Transactions 2009–10 2008–091 Investment in shares – 12,912,5002 Interest Received 2,299,335 560,754 3 Marketing fees 190,485,191 6,699,241 4 Balance outstanding as on 31.03.2010

Payable for Services 46,685,457 – Receivable for advances given 371,431 19,486,440

iii) Key managerial PersonnelSr. No. Transactions 2009–10 2008–091 Interest paid 17,257,679 8,565,457 2 Directors' remuneration 26,830,230 5,992,497 3 Dividends paid (payment basis) – 50,702,644 4 Outstanding as on 31.03.2010

Loans and Deposits payable 48,500,000 158,170,577iv) Chairman having significant influence

Sr. No. Transactions 2009–10 2008–091 Interest paid 4,979,916 1,936,287 2 Director's commission 6,982,887 – 3 Legal and Professional Fees 4,600,000 4,600,000 4 Sitting fees 110,000 90,000 5 Dividends paid (payment basis) – 25,709,944 6 Outstanding as on 31.03.2010

Loans and Deposits payable 16,100,000 48,100,000

v) Relatives of Key Managerial Personnel (Amount in Rupees)Sr. No. Transactions 2009–10 2008–091 Interest paid 7,461,317 7,840,803 2 Dividends paid (payment basis) – 705,728 3 Outstanding as on 31.03.2010

Loans and Deposits 143,725,000 81,460,000vi) Entities over which key management personnel/individual having significant influence

Sr. No. Transactions 2009–10 2008–091 Interest Paid 3,049,408 3,973,080 2 Rent Paid 6,300,000 6,300,000 3 Dividends paid (payment basis) – 455,436 4 Shareable expense received 961,352 – 5 Outstanding as on 31.03.2010

Loans and Deposits taken 42,328,157 42,662,305C. Disclosure in respect of transactions which are more than 10% of the total transactions of the same type with related

parties during the yearTransactions 2009–10 2008–09

i) Purchase of Raw Material– Petroleum Specialities Pte. Ltd 679,942,647 1,018,147,575

ii) Sale of finished goods/ Raw materials– Petroleum Specialities Pte. Ltd 124,665,670 57,531,795 – Quantum Apar Speciality pty. Ltd 41,541,571 43,920,034 – Poweroil Speciality Products FZE 34,958,028 10,617,874 – Uniflex Cables Ltd 241,704,290 181,637,022

iii Sale of capital goods– Uniflex Cables Ltd 3,586,585 7,588,516 – Marine Cables and Wires Private Limited – 2,091,513

iv) Lease Asset– Uniflex Cables Ltd 23,445,146 32,900,000

v) Lease Rental– Uniflex Cables Ltd 8,720,667 1,995,800

vi) Job work done for Subsidiary– Uniflex Cables Ltd 4,833,698 779,856

vii) Job work done by Subsidiary– Uniflex Cables Ltd 12,045,015 1,301,406

viii) Reimbursement (received) of expenses– Petroleum Specialities Pte. Ltd 184,198 1,431,444 – Uniflex Cables Ltd 10,000,000 6,568,722

ix) Interest Received– Uniflex Cables Ltd 43,493,307 20,839,233 – Apar Chematek Lubricants Limited 2,299,335 560,754

x) Investment in Shares– Apar Chematek Lubricants Limited – 12,912,500 – Uniflex Cables Ltd. – 440,238,138

xi) Guarantees given by the Company on behalf of subsidiary companies– Petroleum Specialities Pte. Ltd 673,650,000 354,620,000 – Uniflex Cables Ltd. 1,250,000,000 1,250,000,000

xii) Interest paid– Dr. N. D. Desai 4,979,916 1,936,287 – Kushal N. Desai 7,682,087 3,104,481 – Chaitanya N. Desai 9,575,592 5,460,976 – Rishabh K. Desai 2,813,658 3,338,921 – Vineeta R. Srivastava 3,431,671 2,907,080 – Apar Corporation Private Limited 2,694,188 3,802,059



Schedule 22 NOTES TO THE FINANCIAL STATEMENTS (Contd...) Schedule 22 NOTES TO THE FINANCIAL STATEMENTS (Contd...)C. Disclosure in respect of transactions which are more than 10% of the total transactions of the same type with related

parties during the year (Contd...) (Amount in Rupees)2009–10 2008–09

xiii) Dividends paid (payment basis)– Dr. N. D. Desai – 25,709,944 – Kushal N. Desai – 25,518,916 – Chaitanya N. Desai – 25,183,728

xiv) Legal & Professional Fees– Dr. N. D. Desai 4,600,000 4,600,000

xv) Rent Paid– Apar Corporation Private Limited 6,300,000 6,300,000

xvi) Marketing fees– Apar Chematek Lubricants Limited 190,485,191 6,699,241

xvii) Director Remuneration– Kushal N. Desai 13,358,944 2,983,588 – Chaitanya N. Desai 13,471,286 3,008,909 – Dr. N. D. Desai 6,982,887 –

14.The Company's operations predominantly relate to manufacture of Conductors and Transformer/Speciality Oils which businesseshave been identified as primary segments based on the Company's risk profile and internal reporting structure.a. Business Segments

a. Business Segments (Contd.)

Particulars Conductor Transformer & Speciality Others Eliminations TotalOils

2009-10 2008-09 2009-10 2008-09 2009-10 2008-09 2009-10 2008-09 2009-10 2008-09REVENUEExternal Sales 97,066.65 138,350.61 102,413.40 107,549.92 325.37 440.74 – – 199,805.43 246,341.27 Other Income 1,515.18 251.00 27.60 305.89 121.08 75.42 – – 1,663.86 632.30 Inter-Segment Sales – – 74.16 187.53 – – (74.16) (187.53) – – Total Revenue 98,581.83 138,601.60 102,515.16 108,043.34 446.45 516.16 (74.16) (187.53) 201,469.29 246,973.58 RESULT Segment result 6,010.25 9,759.81 8,795.37 (3,777.30) 62.87 49.29 – – 14,868.50 6,031.79 Unallocable Corporate/Other expenses (net of miscellaneous income) (2,431.46) (2,064.80)Operating Profit 12,437.04 3,966.99 Interest Expense (5,074.10) (7,357.45)Interest Income 3,118.11 4,232.55Profit before taxes 10,481.05 842.10Income tax Current tax (1,922.00) (2.00)Minimum Alternate tax – (23.50)Minimum Alternate tax credit entitlement – 23.50 Prior year tax – 35.11 Deferred tax - Credit/(Charge) 54.62 (299.46)Fringe Benefit Tax – (45.00)Profit after tax and before Extraordinary items 8,613.67 530.75Extraordinary items (net) - Income/(Expenses) - Net of income tax (5,555.38) – Profit after tax and Extraordinary items 3,058.28 530.75

(Rupees in Lacs)

Conductor Transformer & Speciality Other Eliminations TotalOils

2009-10 2008-09 2009-10 2008-09 2009-10 2008-09 2009-10 2008-09 2009-10 2008-09OTHER INFORMATION Segment assets 56,966.39 65,028.72 85,018.84 96,309.50 143.08 109.50 – – 142,128.31 161,447.72Unallocable Corporate and Other assets 16,196.47 13,631.34Total Assets 158,324.78 175,079.06Segment liabilities 44,642.28 58,839.58 71,996.78 79,067.45 1.08 – – – 116,640.14 137,907.03 Unallocate Corporate and other liabilities 2,812.50 612.67 Total Liabilities 119,452.64 138,519.70Capital expenditure 309.97 1,421.83 475.32 554.27 – – – – 785.29 1,976.10 Capital expenditure - unallocable 240.37 442.65 Depreciation 720.67 666.73 295.53 273.50 – – – – 1,016.19 940.23 Depreciation on - unallocable 171.73 159.03 Non-cash expenses other than depreciation 35.84 87.29 12.81 19.75 – – – – 48.65 107.04 Non-cash expenses other than depreciation - unallocable 177.47 66.98

(Rupees in Lacs)

b. Geographical Segmentsi) Revenue by geographical Market:

ii) The Company's tangible fixed assets are located entirely in India.iii) Carrying amount of Segment Assets:

*Include deemed exports Rs. 8,616.83 lacs (previous year Rs. 14,886.32 lacs).

Conductor Transformer & Speciality Others TotalOils

2009–10 2008-09 2009-10 2008-09 2009-10 2008-09 2009-10 2008-09Outside India 23,665.53 44,418.91 26,559.76 21,123.48 – – 50,225.29 65,542.39 In India* 73,401.12 93,931.70 75,853.64 86,426.44 325.37 440.74 149,580.14 180,798.88 Total 97,066.65 138,350.61 102,413.40 107,549.92 325.37 440.74 199,805.43 246,341.27

(Rupees in Lacs)

Conductor Transformer & Speciality Others Unallocated TotalOils

2009-10 2008-09 2009-10 2008-09 2009-10 2008-09 2009-10 2008-09 2009-10 2008-09Outside India 2,686.13 23,865.90 3,424.55 8,584.92 – – – – 6,110.68 32,450.82 In India 54,280.26 41,162.82 81,594.29 87,724.58 143.08 109.50 16,196.47 13,631.34 152,214.10 142,628.25 Total 56,966.39 65,028.72 85,018.84 96,309.50 143.08 109.50 16,196.47 13,631.34 158,324.78 175,079.06

(Rupees in Lacs)

iv) The Company's fixed assets are located entirely in India.Segment Revenue and ResultThe expenses which are not directly attributable to the business segment are shown as unallocable corporate/other expenses(net of miscellaneous income)Segment assets and liabilitiesSegment assets include all operating assets used by the business segment and consist principally of fixed assets, debtors andinventories. Segment liabilities primarily include creditors and other liabilities. Assets and liabilities that cannot be allocatedbetween the segments are shown as a part of unallocable corporate assets and liabilities respectively.

Schedules annexed to and forming part of Notes to the Accounts for the year ended March 31, 2010Schedules annexed to and forming part of the Financial Statement


Schedule 22 NOTES TO THE FINANCIAL STATEMENTS (Contd...)Schedule 23 ADDITIONAL INFORMATION REQUIRED BY PART II OF SCHEDULE VI OF COMPANIES ACT, 1956 (Contd...)

16. For additional information required by Part II of Schedule VI to the Companies Act, 1956 see Schedule 23 annexed.17.Previous year figures have been regrouped, wherever necessary, to conform to current year's classification.

Sr. No. Particulars 2009-10 2008-091 Profit after tax and before extraordinary items - in Rs. 861,366,597 53,074,851 2 Profit after tax and extraordinary items - in Rs. 305,828,399 53,074,851 3 Weighted Number of Equity Shares outstanding during the year 32,336,031 32,336,031 4 Nominal Value of Equity Shares in Rs. 10 10 5 Earnings per share - in Rs.

Basic & Diluted before extraordinary items 26.64 1.64 Basic & Diluted after extraordinary items 9.46 1.64

1. Information for class of goods manufactured during the year : Licensed ActualCapacity Installed Capacity Production Stock

(see notes (b) (see notes (a) and (see note Turnoverand (d) below) (b) below) (c) below) (Gross of excise) Opening Closing

Class of Goods Unit Quantity No. of Quantity No. of Value Value Value shifts shifts Quantity Rupees Quantity Rupees Quantity Rupees

i) Transformer Oils MT 153,495* 1 & 3 337,351 1 & 3 117,582 111,378 4,500,997,236 1,230 59,739,103 1,971 87,063,960 (see note (f)) (102,892) (269,881) (105,646) (102,248) (6,170,997,689) (1,653) (65,040,706) (1,230) (59,739,103)

** KL 182,000 for various (122,000) types of oils

covered in (i)and for otheroils for whichthe Company

is holdingregistration

Special Grade MT 70,844 * -do- 63,192 62,726 2,291,223,450 80 3,058,809 533 21,646,990Pharmaceutical Oils (66,627) (38,613) (39,993) (1,935,005,650) (1,468) (48,718,221) (80) (3,058,809)

** KL 84,000 (79,000)

Other Specialities Oils MT 113,012 * -do- 68,626 68,121 3,858,538,043 2,070 202,612,486 2,334 169,206,194(including R.P.Oils) (100,362) (54,835) (53,586) (3,389,408,565) (1,279) (75,007,565) (2,070) (202,612,486)ii) AAC, AAAC and ACSR MT 102,000 3 97,097 3 76,887 75,075 8,636,706,463 1,374 137,137,174 3,186 334,807,842 Conductors (102,000) (97,097) (88,289) (89,715) (12,600,073,369) (2,801) (304,799,747) (1,374) (137,137,174)iii) Aluminium

rods suitable MT 96,000 3 74,988 3 63,399 3,858 442,917,119 $ $ $ $ for further (96,000) (74,988) (71,880) (5,911) (763,998,102) ($) ($) ($) ($) manufacture of ACSR/AAC/AAAC

19,730,382,311 402,547,572 612,724,986 (24,859,483,374) (493,566,239) (402,547,572)

* Company's application for manufacture has been taken on record and registered by the concerned Government authorities. ** Equivalent to MT. $ Opening and Closing Stock is included in work-in-process as the same is for captive consumption.Notes: a) Installed capacities are certified by Management of the Company and not verified by the auditors as this is a technical matter.b) In cases where installed capacities exceed the licensed capacities, the Company's applications to the Government for regularisation

of the same have been accepted in part only or are pending with the Government. c) Includes : (A) Conversion by the Company on customers' account, captive consumption, and sample for testing.

15.Particulars of earnings per shareUnit 2009-10 2008-09

Quantity Quantityi) Transformer Oils KL 5,463 3,821 ii) Special Grade Pharmaceutical Oils KL 13 8 iii) Other Specialities Oils KL 241 458 iv) Aluminium Rods suitable for further manufacture of ACSR/AAC MT 59,541 65,969

B) Other Specialities Oil manufactured by a third party on behalf of the Company. KL 816 434

C) Processed by third parties - i) Aluminium Wire Rods MT 2,124 2,925 ii) Aluminium Conductors MT 542 299

d) In some of the classes of goods listed above, the licences are available in terms of more than one unit. In such cases, the quantitativeinformation is expressed in terms of the units in which the items are sold. Further, in the cases where the licensed capacity hasalso been shown in the units in which the goods are sold (alongwith the units in which the licence has been issued), the conversionhas been relied on by the auditors without verification as this is a technical matter.

e) Figures in brackets pertain to the previous year. f) In respect of item (i) , the quantities stated against production, turnover and stock of goods produced are in KL, except one product

i.e. Flex Oil A-Super included under the head "Other Specialities Oils".

2. Information for class of goods traded during the year Stock

Purchase Opening Closing TurnoverClass of Goods Unit Quantity Value Quantity Value Quantity Value Quantity Value

Rupees Rupees Rupees RupeesThermoplastic Elastomers MT 114 27,410,076 32 8,706,308 40 10,288,658 106 32,521,359

(56) (14,401,282) (29) (6,236,611) (32) (8,706,308) (53) (14,648,664)Lubricants MT 29 7,175,736 39 8,735,839 41 7,148,430 27 11,495,540

(46) (9,437,321) (21) (4,966,741) (39) (8,735,839) (29) (15,890,112)Vivatek MT 2,108 172,425,579 – – 579 51,322,830 1,529 130,273,835

– – – – – – – –Conductors MT 446 154,674,843 – – – – 446 157,254,710

(1,895) (362,327,804) – (1,895) (362,327,804)Acrylonitrile MT – – – – – – – –

(380) (29,020,448) (380) (29,425,680) 361,686,234 17,442,147, 68,759,918 331,545,444

Total (415,186,855) (11,203,352) (17,442,147) (422,292,260)Note: Figures in brackets pertain to the previous year.

Schedule 23 ADDITIONAL INFORMATION REQUIRED BY PART II OF SCHEDULE VI OF COMPANIES ACT, 1956 Schedules annexed to and forming part of Notes to the Accounts for the year ended March 31, 2010

Schedules annexed to and forming part of Notes to the Accounts for the year ended March 31, 2010Schedules annexed to and forming part of Notes to the Accounts for the year ended March 31, 2010


Schedule 23 ADDITIONAL INFORMATION REQUIRED BY PART II OF SCHEDULE VI OF COMPANIES ACT, 1956 (Contd...) Schedule 23 ADDITIONAL INFORMATION REQUIRED BY PART II OF SCHEDULE VI OF COMPANIES ACT, 1956 (Contd...)3. Consumption of raw materials and components

Note : Consumption includes handling losses and differences found on physical verification of stock.

2009-10 2008-09Unit Quantity Rupees Quantity Rupees

Non-ferrous metals MT 64,560 7,155,549,566 81,404 9,904,548,514 Ferrous metals MT 16,930 731,239,609 19,317 865,021,965 Chemicals MT 3,327 292,738,205 1,656 182,800,461Base Oils KL 244,374 7,258,715,288 194,581 9,760,374,366 Others 28,941,686 8,064,363 Total 15,467,184,354 20,720,809,669

4. Consumption of raw materials and components (including cost of sales of raw materials, handling losses and differencesfound on physical verification of stock) :

Note : Imports through canalising agencies and items of foreign origin purchased locally are shown as part of indigenous consumption.

2009-10 2008-09% Rupees % Rupees

Imported at landed cost (including duty and clearing charges incurred in India) 64 9,874,040,307 72 14,835,872,592 Indigenous 36 5,593,144,047 28 5,884,937,077 Total 100 15,467,184,354 100 20,720,809,669

5. Value of imports on CIF basis :

Note : (i) Imports through canalising agencies and items of foreign origin purchased locally are excluded.

2009-10 2008-09Raw materials and Components 9,694,130,730 14,845,293,567 Stores and spare parts 3,561,806 2,765,593 Capital goods 20,109,471 23,234,916 Total 9,717,802,007 14,871,294,076

(Amount in Rupees)

6. Expenditure in foreign currency on account of : 2009-10 2008-09

Professional Fees 6,579,343 2,769,253Royalty 17,835,937 7,907,259Interest and Bank charges 243,117,590 421,139,502Commission & foreign Travel 73,005,605 71,087,180Others 3,364,883 2,913,695Total 343,903,358 505,816,889

(Amount in Rupees)

7. Remittance in Foreign Currency for Dividends: 2009-10 2008-09

a) No. of shareholder 1 1 b) No. of shares held 4,294,637 4,594,637 c) Year of dividend 2008-09 2007-08 d) Amount remitted - Rs. – 18,378,548

(Amount in Rupees)

8. Earnings in foreign exchange :2009-10 2008-09

Claims and Commission received – 1,670,729Export of goods calculated on FOB basis 5,022,528,855 6,554,239,297Deemed exports 861,682,540 1,488,632,489Others (Freight, Insurance & Interest) 256,510,688 264,485,200Total 6,140,722,083 8,309,027,715

(Amount in Rupees)

9. Consumption of stores and spare parts (including handling losses and differences found on physical verification ofstocks) :

Note : Imports through canalising agencies and items of foreign origin purchased locally are shown as part of indigenous consumption.

2009-10 2008-09% Rupees % Rupees

Imported at landed cost 5.97 3,561,806 2.23 1,685,723 Indigenous 94.03 56,055,027 97.77 73,837,910 Total 100.00 59,616,833 100.00 75,523,633

10. Sale of raw materials and stores and spares : 2009-10 2008-09

Unit Quantity Rupees Unit Quantity RupeesBase Oils KL 5,522 188,170,341 KL 1,960 119,939,063 Ferrous metal & Non-ferrous metals MT 4,898 403,209,282 MT – –Total 591,379,623 119,939,063

As per our report of even date attachedFor Price Waterhouse For and on behalf of the Board of DirectorsChartered AccountantsFirm Registration No.: 301112E


Signatures to Schedules 1 to 23


Balance Sheet Abstract and Company’s General Business Profile(Part IV of Schedule VI of the Companies Act, 1956 (As amended))

For and on behalf of the Board of Directors

Kushal N. Desai H.N. Shah V. C. Diwadkar Sanjaya R. KunderPlace : Mumbai Managing Director & Director Chief Financial Officer Company SecretaryDated : May 25, 2010 Chief Executive Officer

Public IssueBonus Issue

3 1 0 3Registration No.Balance Sheet Date

1. Registration Details

2. Capital Raised during the year (Amount in Rs Thousands)

Total Liabilities3. Position of Mobilisation and Deployment of Funds (Amount in Rs Thousands)

2 0 1 0Date Month Year

Private Placement

Paid-up CapitalSources of Funds

Total Assets

Secured Loans

Product Description Item Code No. (ITC Code)5. Generic Names of three Principal Products / Services of Company (as per monetary terms)

Application of Funds

3 8 8 7 2 1 4

1 2 8 0 2

3 2 3 3 6 0

N I LRight Issue N I L

State Code 0 4CIN No. L91110GJ1989PLC012802

N I LN I L

Turnover (net of excise)Profit before Tax

4. Performance of Company (Amount in Rs Thousands)

Profit after Tax 3 0 5 8 2 8Total Expenditure 1 9 6 5 4 3 6 2

4 9 2 5 6 7Earning Per Share in Rs Dividend Rate % 5 09 . 4 6

Transformer & Speciality Oils 2 7 1 0 . 9 0AAC/ACSR Conductors 7 6 1 4 . 9 0

2 0 1 4 6 9 2 9

Net Fixed AssetsNet Current Assets

Investments 3 1 7 5 0 82 3 6 0 9 5 11 2 0 8 7 5 5

3 8 8 7 2 1 4

5 7 4 5 4 7

Deferred Tax Liability (Net) 8 0 3 2 0Reserves and Surplus Unsecured Loans2 6 0 6 4 7 8 3 0 2 5 0 9

Cash Flow Statement For the year ended March 31, 2010(Amount in Rupees)

2009-10 2008-09 CASH FLOW FROM OPERATING ACTIVITIES :Profit before taxation, Exceptional Items and Extraordinary Items 1,070,716,400 101,611,827 Adjustments for:Depreciation/Amortisation 118,791,962 109,925,885 (Profit)/Loss on Sale of Fixed Assets(Net) (1,481,797) (3,700,692)Unrealised exchange loss/(gain) (288,263,448) 897,679,073 Profit on sale of investment – (1,027,749)Dividend on investments (2,441,745) (185,493)Interest income (311,811,323) (423,255,307)Interest expense 507,409,939 735,744,753

22,203,588 1,315,180,470 Operating profit before working capital changes in : 1,092,919,987 1,416,792,297 Trade and other receivables 1,028,503,930 (1,057,270,937)Inventories (807,976,662) (300,000,468)Trade and other payables (1,654,384,936) (1,433,857,668) 2,490,221,159 1,132,949,754 Cash generated from/(used in) operations (340,937,680) 2,549,742,052 Taxes paid (including fringe benefit tax) (net of refunds) (166,966,074) (215,589,393)Net cash from/(used in) operating activities (507,903,754) 2,334,152,659 CASH FLOW FROM INVESTING ACTIVITIES :Purchase of Fixed Assets (102,565,695) (241,874,685)Sale of Fixed Assets 3,761,470 9,358,465 Purchase of investments in– Uniflex Cables Ltd – (252,524,180)– Apar Chematek Lubricants Ltd – (12,912,500)Investment in Mutual fund (Net) – 4,831,659 Dividend received 2,441,745 185,493 Loan & Advances to Unilfex (Net) (576,219,625) (129,466,810)Interest Received 295,926,638 (376,655,467) 449,991,104 (172,411,454)Net cash from/(used in) investing activities (376,655,467) (172,411,454)CASH FLOW FROM FINANCING ACTIVITIES :Proceeds/(repayments) from/of fixed deposits (net) 53,167,500 15,432,000 Proceeds/(repayments) from/of bank borrowings (net) 207,300,512 (439,517,886)Proceed/(repayments) from Short term borrowings (143,504,725) 172,983,918 Proceed/(repayments) of long term borrowings (9,078,951) 130,318,000 Interest Paid (529,162,827) (746,066,387)Dividend Paid – (129,726,993)Tax on Dividends – (21,982,034)Net cash from/(used in) financing activities (421,278,491) (1,018,559,382)Net Increase/(Decrease) in cash and cash equivalents (1,305,837,712) 1,143,181,823 Cash and cash equivalents at the beginning of year 5,996,982,699 4,853,800,877 Cash and cash equivalents at the end of year 4,691,144,987 5,996,982,699



Notes : 1) Previous year figures have been regrouped/restated wherever necessary to conform to the current year presentation.2) Refer Schedule 10 of financial statements for composition of cash and bank balances. 3) Cash and cash equivalents include margin money of Rs. 3,945,331,648 (Previous year Rs. 3,066,764,596) - Refer Note under Schedule

10 ‘Cash and Bank Balances’.


Statement pursuant to Exemption received under Section 212 (8) ofthe Companies Act, 1956 relating to Subsidiary Companies for the yearended March 31, 2010.Sr. Particulars Petroleum Specialities Pte. Poweroil Speciality Quantum Apar Speciality Uniflex Cables Marine CablesNo. Limited, Singapore Products FZE, Oils Pty. Limited, Limited, India & Wires Private

Sharjah Australia Limited, IndiaIn US$ In Rupees In AED In Rupees In AUD In Rupees In Rupees In Rupees

a) Capital 59,101 2,643,645 150,000 1,967,274 300,000 10,294,085 249,803,660 9,469,000 b) Reserve 5,921,263 275,839,957 (451,537) (5,579,323) (139,537) (84,461) (295,975,760) (23,052,911)c) Total Assets 8,338,100 384,367,147 1,419,334 17,411,782 3,148,722 133,938,786 1,968,607,060 61,703,454 d) Total Liabilities 2,357,736 105,883,545 1,720,870 21,023,831 2,988,259 123,729,162 2,014,779,160 75,287,365 e) Details of investment – – – – – – – –

(Except in case of investment in Subsidiaries)

f) Turnover 31,878,507 1,516,790,089 2,969,392 38,534,123 6,774,176 275,791,890 1,832,889,675 39,834,398 g) Profit before taxation 2,756,485 134,697,134 (23,422) 110,214 248,095 28,690,483 (274,582,169) 6,626,838 h) Provision for taxation 471,433 22,453,647 – – 25,828 939,048 – 600,000 i) Profit after taxation 2,285,052 112,243,487 (23,422) 110,214 222,267 27,751,435 (274,582,169) 6,026,838 j) Proposed dividend Nil Nil Nil Nil Nil Nil Nil NilAs on 31.03.2010: 1 U.S. Dollar(USD) = Rs. 44.91, 1 United Arab Emirates Dirham(AED) = Rs. 12.26, 1 Australian Dollar(AUD) = Rs. 41.41

Consolidated Auditors’ Report

To the Board of Directors of Apar Industries Limited1. We have audited the attached consolidated Balance Sheet of

Apar Industries Limited (the “Company”) and its subsidiariesand its jointly controlled entity; hereinafter referred to as the“Group” (refer Note 5(a) and 5(b), Schedule 22 to theattached consolidated financial statements) as at March 31,2010, the related consolidated Profit and Loss Account andthe consolidated Cash Flow Statement for the year endedon that date annexed thereto, which we have signed underreference to this report. These consolidated financialstatements are the responsibility of the Company’smanagement. Our responsibility is to express an opinion onthese financial statements based on our audit.

2. We conducted our audit in accordance with the auditingstandards generally accepted in India. Those Standardsrequire that we plan and perform the audit to obtainreasonable assurance about whether the financialstatements are free of material misstatement. An auditincludes examining, on a test basis, evidence supporting theamounts and disclosures in the financial statements. Anaudit also includes assessing the accounting principles usedand significant estimates made by management, as well asevaluating the overall financial statement presentation. Webelieve that our audit provides a reasonable basis for ouropinion.

3. We did not audit the financial statements of threesubsidiaries and the jointly controlled entity included in theconsolidated financial statements, which constitute totalassets of Rs. 2,439,776,386 and net assets of Rs. 1,055,419,592 as at March 31, 2010, total revenue of Rs. 2,863,382,499, net loss of Rs. 123,993,893 and net cashinflow amounting to Rs. 78,911,542 for the year thenended. These financial statements and other financialinformation have been audited by other auditors whosereports have been furnished to us, and our opinion on theconsolidated financial statements to the extent they havebeen derived from such financial statements is based solelyon the report of such other auditors.

4. We report that the consolidated financial statements havebeen prepared by the Company’s Management inaccordance with the requirements of Accounting Standard(AS) 21 - Consolidated Financial Statements, AccountingStandard (AS) 23 - Accounting for Investments in Associatesin Consolidated Financial Statements and AccountingStandard (AS) 27 - Financial Reporting of Interests in JointVentures notified under sub-section 3C of Section 211 ofthe Companies Act, 1956.

5. The Company has not provided for a “mark-to-market” losson commodity forward/option contracts aggregating Rs.400,027,218 as at March 31, 2010 as was required to beprovided on grounds of prudence under the provisions ofAccounting Standard 1 “Disclosure of Accounting Policies”(Refer Note 4A, Schedule 22), for the reasons stated by themanagement in the said note. Consequently, withoutconsidering the tax effect, the profit for the year andreserves and surplus are overstated and current liabilities areunderstated by Rs. 400,027,218. Had the effect of theobservation made by us been considered, the reported profitwould turn into a loss for the year of Rs. 155,676,316 (asagainst the reported profit after tax and extraordinary itemsof Rs. 244,350,902), the reserves and surplus would havebeen Rs. 2,110,309,170 (as against the reported figure ofRs. 2,510,336,388) and the current liabilities would havebeen Rs. 12,721,070,278 (as against the reported figure ofRs. 12,321,043,060).

6. Based on our audit and on consideration of reports of otherauditors on separate financial statements and on the otherfinancial information of the components of the Group asreferred to above, and to the best of our information andaccording to the explanations given to us, in our opinion,the attached consolidated financial statements, subject tothe effect on the financial statements of the matter referredto in the preceding paragraph, give a true and fair view inconformity with the accounting principles generallyaccepted in India:a) in the case of the consolidated Balance Sheet, of the

state of affairs of the Group as at March 31, 2010; b) in the case of the consolidated Profit and Loss Account,

of the reported profit of the Group for the year ended onthat date; and

c) in the case of the consolidated Cash Flow Statement, ofthe cash flows of the Group for the year ended on thatdate.


Firm Registration No.: 301112E




Consolidated Balance Sheet As at March 31, 2010 (Amount in Rupees)Schedule As at 31.03.2010 As at 31.03.2009

SOURCES OF FUNDSShareholders' FundsShare Capital 1 323,360,310 323,360,310 Reserves and Surplus 2 2,510,336,388 2,476,262,828

2,833,696,698 2,799,623,138 Minority Interest 3,213,091 79,054,474 Loan FundsSecured loans 3 915,392,232 1,112,794,822 Unsecured loans 4 701,931,068 501,035,027

1,617,323,300 1,613,829,849 Deferred taxation liability (Net) 5 71,895,177 63,289,750

4,526,128,266 4,555,797,211 APPLICATION OF FUNDSGoodwill on Consolidation 603,083,455 603,083,455 Less : Provision for impairment (603,083,455) –

– 603,083,455 Fixed Assets 6 Gross block 3,090,566,782 2,794,019,409 Less: Depreciation 1,304,623,655 1,125,847,500 Net block 1,785,943,127 1,668,171,909 Fixed Assets held for sale/ disposal 731,928 731,928 Capital work-in-progress/ advances 23,958,733 123,932,868

1,810,633,788 1,792,836,705 Investments 7 227,240 227,240 Current Assets, Loans and AdvancesInventories 8 4,391,829,763 3,635,226,489 Sundry debtors 9 4,243,229,290 5,132,571,074 Cash and bank balances 10 4,882,318,585 6,109,244,758 Loans and advances 11 1,735,893,318 1,690,135,905

15,253,270,956 16,567,178,226 Less: Current Liabilities and ProvisionsCurrent liabilities 12 12,321,043,060 14,399,237,143 Provisions 13 216,960,658 19,852,964

12,538,003,718 14,419,090,107 Net Current Assets 2,715,267,238 2,148,088,119 Miscellaneous expenditure (to the extentnot written off or adjusted) 14 – 11,561,692

4,526,128,266 4,555,797,211 Significant Accounting Policies 21 Notes to the Financial Statements 22

(Amount in Rupees)Schedule 2009-2010 2008-2009

INCOMESale of goods, services and related recoveries 15 24,168,855,270 28,754,860,021 Less: Excise Duty 1,813,405,631 2,384,262,874

22,355,449,639 26,370,597,147Other income 16 160,000,638 62,264,885

22,515,450,277 26,432,862,032 EXPENDITUREOperating and other expenses 17 21,221,336,084 25,972,371,296 Decrease / (Increase) in stocks 18 (238,651,383) (104,524,971)Depreciation 185,133,303 147,150,570 Interest and discounting charges (net) 19 331,989,283 412,498,989

21,499,807,287 26,427,495,884 Profit before Taxation and Exceptional Items 1,015,642,990 5,366,148 Exceptional items 20 11,561,692 17,401,870 Profit before taxation 1,004,081,298 (12,035,722)Provision for taxation:Current tax 215,053,646 12,471,246 Minimum alternate tax – 2,350,000 Minimum alternate tax credit entitlement – (2,350,000)Deferred tax - (credit)/charge 8,605,425 9,502,308 Fringe benefit tax – 5,178,649 Prior period tax – (3,946,026)Wealth tax 200,000 200,000 Profit/(loss) After Taxation and before share of associate's loss 780,222,227 (35,441,899)Share of Associate's net loss – (57,896,636)Profit/(loss) before minority interest 780,222,227 (93,338,535)Minority Interest (Profit)/Loss 67,212,130 40,115,629Profit/(loss) before Extraordinary items for the year 847,434,357 (53,222,906)Extraordinary items (net of tax) - Impairment of Goodwill (Refer Note 6 of Schedule 22) 603,083,455 – Profit/(loss) after taxation & Extraordinary items for the year 244,350,902 (53,222,906)Balance of profit brought forward 980,319,528 1,033,542,434 Amount available for appropriations 1,224,670,430 980,319,528 Appropriated as under:Transfer to general reserve (87,500,000) – Proposed Dividend:On Equity Shares @ Rs. 5 per share (Previous year Rs. Nil per share) (161,680,155) – Tax on dividends (26,855,074) – Balance Carried to Balance Sheet 948,635,201 980,319,528Significant Accounting Policies 21 Notes to the Financial Statements 22 Earnings Per Share (Refer Note 11 of Schedule 22) face value of Rs.10Basic & Diluted before extraordinary items 26.21 (1.65)Basic & Diluted after extraordinary items 7.56 (1.65)

Signatures to the Profit and Loss Account and Schedules 15 to 20, 21 to 22As per our report of even date attached.For Price Waterhouse For and on behalf of the Board of DirectorsChartered AccountantsFirm Registration No.: 301112E


Signatures to the Balance Sheet and Schedules 1 to 14, 21 to 22As per our report of even date attached.For Price Waterhouse For and on behalf of the Board of DirectorsChartered AccountantsFirm Registration No.: 301112E


Consolidated Profit and Loss Account For the year ended March 31, 2010


Schedules annexed to and forming part of the Consolidated Balance SheetSchedules annexed to and forming part of the Consolidated Balance Sheet(Amount in Rupees)

As at 31.03.2010 As at 31.03.2009

(A) Authorised :91,998,750 (91,998,750) Equity Shares of Rs.10 each 919,987,500 919,987,500

919,987,500 919,987,500 (B) Issued, Subscribed and Fully Paid Up :

32,336,031 (32,336,031) Equity Shares of Rs.10 each fully paid 323,360,310 323,360,310 Total 323,360,310 323,360,310

Schedule 1 SHARE CAPITAL


Deferred tax liability arising on account of timing difference in:Book and Tax depreciation 109,980,856 110,945,744Less: Deferred tax asset arising on account of timing differences in :

i) Provision for doubtful debts and advances 12,403,868 9,565,232 ii) Provision for gratuity and leave salary 6,490,728 5,762,797iii) Voluntary Retirement Scheme 2,290,269 1,714,008iv) Expenses allowable on payment basis 8,476,083 8,121,911v) Unabsorbed Depreciation 8,460,882 9,399,930

38,121,830 34,563,878 Deferred tax (Asset)/Liability - Share of Joint Venture (net) (Refer Note 5(b), Schedule 22) (36,151) 13,092,116 Total 71,895,177 63,289,750

Schedule 5 DEFERRED TAX LIABILITY (NET)

Capital ReserveAs per last balance sheet 4,950,746 4,950,746 Capital Redemption ReserveAs per last balance sheet 147,547,770 147,547,770 Securities Premium AccountAs per last balance sheet 588,520,277 588,520,277 Foreign Currency Translation Reserve (16,817,606) 4,924,507 General ReserveAs per last balance sheet 750,000,000 750,000,000 Add :- Transfer from profit and loss account 87,500,000 –

837,500,000 750,000,000 Surplus in profit and loss account 948,635,201 980,319,528 Total 2,510,336,388 2,476,262,828

Schedule 2 RESERVES AND SURPLUS

Fixed Deposits*a) From public 198,080,000 143,912,500 b) From directors 45,100,000 46,100,000

243,180,000 190,012,500 Loans from Directors (repayable at call) 269,500,000 160,170,577 Inter Corporate Deposits (repayable at call) 189,251,068 150,851,950 Total 701,931,068 501,035,027*Repayable within one year Rs. 77,527,000 (Previous year Rs.118,966,500).

Schedule 4 UNSECURED LOANS

From Banks :i) Cash Credit/Working Capital Demand Loans 606,653,183 482,476,822 ii) Term Loans 308,739,049 630,318,000

Total 915,392,232 1,112,794,822Notes:A) The Cash Credit/Working Capital Demand Loans/Pre-shipment Export Finance from banks are secured by:

i) Hypothecation of specified stocks, specified book debts of the Company and movable plant and machinery at NalagarhUnit.

ii) first charge by way of equitable mortgage by deposit of title deeds of Company's specified immovables properties, bothpresent and future.

iii) first charge by way of equitable mortgage by deposit of title deeds of certain immovables properties of Apar CorporationPrivate Limited, a related party.

iv) Out of the above, an amount of Rs. 269,460,000 (Previous year Rs. NIL) is secured by lien on term deposit of Rs. 290,000,000.B) The term loan is secured by hypothecation of specific machineries acquired out of proceeds of the loan. The amount payable

within a year Rs. 217,807,741 (Previous year Rs. 130,318,000).

Schedule 3 SECURED LOANS

GROSS BLOCK DEPRECIATION WRITTEN DOWN VALUEAs at Additions Deductions/ As at Upto Deductions/ For the Upto As at As at

01.04.2009 Adjustments 31.03.2010 31.3.2009 Adjustments year 31.03.2010 31.03.2010 31.03.2009Land

– Freehold 42,388,743 – – 42,388,743 – – – – 42,388,743 42,388,743 – Leasehold 47,203,031 34,569,882 – 81,772,913 7,322,972 – 713,936 8,036,908 73,736,005 39,880,059

Buildings 511,798,428 61,323,515 – 573,121,943 114,766,528 – 22,659,230 137,425,758 435,696,185 397,031,900 Plant and Machinery 1,992,959,396 196,885,192 (8,928,522) 2,180,916,066 879,192,678 (4,907,153) 141,661,067 1,015,946,592 1,164,969,474 1,113,766,718 Furniture, fixture and 133,407,302 6,617,834 (349,401) 139,675,735 96,516,963 (133,162) 9,721,543 106,105,344 33,570,391 36,890,339 equipments Motor Vehicles 37,707,373 6,436,402 (1,649,271) 42,494,504 20,815,468 (1,316,833) 4,613,143 24,111,778 18,382,726 16,891,905 Intangible Asset 26,543,884 1,075,628 – 27,619,512 6,635,971 – 5,326,704 11,962,675 15,656,837 19,907,913 Share of Joint Venture 2,011,252 566,114 – 2,577,366 596,920 – 437,680 1,034,600 1,542,766 1,414,332 (Refer Note 5 (b), Schedule 22)

2,794,019,409 307,474,567 (10,927,194) 3,090,566,782 1,125,847,500 (6,357,148) 185,133,303 1,304,623,655 1,785,943,127 1,668,171,909 Previous year 1,469,149,726 1,352,620,167 (27,750,484) 2,794,019,409 395,694,923 (583,002,008) 147,150,570 1,125,847,500 1,668,171,909 Fixed Assets held for Sales/disposal (at estimated net realisable value - refer note (1) below) 731,928 731,928 Capital work-in-progress/ Advances 23,958,733 123,932,868

1,810,633,788 1,792,836,705

Notes:1) Fixed Assets held for sale/disposal have been stated at lower of book value or net realisable value and include the following:

I) Land & Building Rs. 231,928 (Previous Year Rs. 231,928) II) Plant & Machinery Rs. 500,000 (Previous Year Rs. 500,000)

Schedule 6 FIXED ASSETS


Schedules annexed to and forming part of the Consolidated Balance SheetSchedules annexed to and forming part of the Consolidated Balance Sheet(Amount in Rupees)

As at 31.03.2010 As at 31.03.2009

Long-term, unquoted, unless otherwise statedA. Government of India Securities:

i) 6 Year National Savings Certificates 4,240 4,240 ii) 12 Year National Defence Certificates 6,000 6,000 iii) 6 Year National Savings Certificates

(held as security by Government Departments) 7,000 7,000 17,240 17,240

B. Non Trade:4,200 Shares (Previous year 4,200 shares) of Natpur Co-operative Bank Limited of Rs. 50 each 210,000 210,000 Total 227,240 227,240 Aggregate book value of unquoted investments 227,240 227,240 Aggregate book value of quoted investments – – Aggregate market value of quoted investments – –

Schedule 7 INVESTMENTS - (AT COST)

Face Value Unit Value(in Rs.) (in Numbers) (in Rs.)

ING Liquid Fund Institutional-Daily Dividend Option 10 45,199,170 452,256,081 Reliance Liquid Fund-Treasury Plan- Institutional Option-Daily Dividend Option 10 69,267,380 1,154,621,503 ING Liquid Fund Super Institutional -Daily Dividend Option 10 116,508,873 1,165,602,921 Kotak Liquid (Institutional Premium) -Daily Dividend 10 25,770,437 315,123,479 HDFC Liquid Fund Premium Plan-Daily Dividend Option Reinvest 10 86,805,737 997,555,444 Kotak Flexi Debt Scheme Institutional -Daily Dividend 10 7,970,046 80,079,039 Kotak Floter Short Term-Daily Dividend 10 6,773,942 72,528,048 Bharti Axa Liquid -Daily Dividend 10 2,256,970 22,512,390 Reliance Liquid Fund-Daily Dividend -Institutional Option 10 7,714,387 130,047,106 Reliance Liquid Fund-Daily Dividend -Retail Option 10 9,995 10,004,162 Reliance Money Manager Fund-Daily Dividend -Institutional Option 10 24,984 30,012,726 Kotak Floter Long Term-Daily Dividend 10 17,779,803 180,079,933 HDFC Cash Mang-Daily Div. 10 940,571 10,004,295 SBNP Ultra 10 747,478 7,502,435 SBNPP Ultra Fund-Daily Div. 10 747,443 7,502,086 32D ICICI Prud.Daily Div 10 1,790,448 20,009,833 DWS Insta Cash Daily Div 10 242,721 2,500,264


(At lower of cost and net realisable value)Stores and spare parts 83,521,835 88,568,291 Raw materials and components # 3,067,334,502 2,544,336,154 Work-in-progress 387,015,684 477,962,102 Finished goods * 853,957,742 524,359,941 Total 4,391,829,763 3,635,226,489# Including Raw materials in transit Rs. 1,355,377,914 (Previous year Rs. 799,303,886)* Including stock of traded goods Rs. 68,759,918 (Previous year Rs.17,442,147)

Schedule 8 INVENTORIES

Debts outstanding for a period exceeding six monthsSecuredConsidered good 317,545 233,927 UnsecuredConsidered good 610,098,639 803,371,575 Considered doubtful 38,983,204 41,991,828

649,399,388 845,597,330 Other debts - Considered goodSecured 2,137,455 1,969,558 Unsecured 3,630,675,651 4,306,515,148

3,632,813,106 4,308,484,706 Less: Provision for doubtful debts 38,983,204 21,510,962 Total 4,243,229,290 5,132,571,074

Schedule 9 SUNDRY DEBTORS

Cash on hand 924,239 12,237,406Cheques on hand 16,959,870 – Fund in Transit 16,000,044 9,143,586Balances with Scheduled Banks :

in current accounts 819,149,925 1,491,394,566in cash credit accounts – 1,441,985,757in deposit accounts 80,250,117 85,531,370in margin money accounts * 3,945,352,601 3,066,785,549

4,844,752,643 6,085,697,242Balances with Non-Scheduled Banks :in current accounts** 230,760 230,760Share of Joint Venture (Refer Note 5(b), Schedule 22) 3,451,029 1,935,764Total 4,882,318,585 6,109,244,758* Rs. 290,000,000 (Previous year Rs. Nil )under lien against working capital loans and balance against Letters of Credit for

Company's imports of raw material** Maximum balance during the year Rs. 230,760 (Previous year Rs. 230,760).

Schedule 10 CASH AND BANK BALANCES

Short term investment in liquid fund purchased and sold during the year


Schedules annexed to and forming part of the Consolidated Profit and Loss AccountSchedules annexed to and forming part of the Consolidated Balance Sheet(Amount in Rupees)

As at 31.03.2010 As at 31.03.2009

Unsecured, considered good, unless otherwise statedAdvances recoverable in cash or in kind or for value to be received **Considered good 1,492,373,403 1,440,320,501 Considered doubtful – 8,275,000

1,492,373,403 1,448,595,501 Less:– Provision for doubtful advances – 8,275,000

1,492,373,403 1,440,320,501 Balances with Excise Department :in current account 1,080,135 80,135 Advance payments of tax less provisions 162,508,427 196,878,070 Interest accrued but not due on deposits/margin monies 66,284,537 49,518,233 Share of Joint Venture (Refer Note 5(b), Schedule 22) 13,646,816 3,338,966Total 1,735,893,318 1,690,135,905 ** Includes Rs. 3,975,095 being excise/custom duty paid under protest (Previous year Rs. 3,975,095)** Includes Rs. 6,110,417 being sales tax paid under protest (Previous year Rs. 6,110,417)

Schedule 11 LOANS AND ADVANCES

(Amount in Rupees)2009–2010 2008–2009

Sales 22,214,380,095 26,712,267,766 Less: Excise duty (1,813,405,631) (2,384,262,874)

20,400,974,464 24,328,004,892 Sale of traded goods 331,545,444 422,292,260 Sale of raw materials 591,379,623 119,939,063 Scrap sales 24,707,929 26,898,535 Export benefits 157,241,124 276,918,627 Rebate/refund of excise duty on deemed/physical exports 224,750,376 791,262,013 Transport charges recovered 441,336,266 398,262,275Processing and other service charges 183,514,413 7,019,482Total 22,355,449,639 26,370,597,147

Schedule 15 SALE OF GOODS, SERVICES AND RELATED RECOVERIES (NET OF EXCISE)

Sundry creditors (Refer Note 3 of Schedule 22)– Total outstanding dues of Micro enterprises and small enterprises 22,512,241 37,017,709 – Total outstanding dues of other creditors 9,906,761,707 12,372,061,924 Other liabilities 2,333,474,550 1,927,644,737 Book overdraft 17,892,568 3,757,986Interest accrued but not due on loans 32,277,926 50,832,749 Share of Joint Venture (Refer Note 5(b), Schedule 22) 8,124,068 7,922,038 Total 12,321,043,060 14,399,237,143

Schedule 12 CURRENT LIABILITIESCommission – 1,806,212 Profit on sale/ disposal of fixed assets (Net) 1,354,911 3,841,950 Provision for expenses no longer required/ sundry balances, written back 12,742,493 1,835,350 Exchange gain - Others (net) 107,842,237 – Profit on sale of short term investment in liquid fund – 1,027,749Dividend on short term investment in liquid fund 2,441,745 185,493Sundry Income 35,427,448 53,568,131Share of Joint Venture (Refer Note 5(b), Schedule 22) 191,805 – Total 160,000,638 62,264,885

Schedule 16 OTHER INCOME

Raw materials and components consumed * 17,242,260,048 22,177,311,868 Purchase of traded goods 361,686,233 415,186,855 Excise duty adjustment of finished goods stock 12,744,829 8,685,263 Power, electricity and fuel 316,604,086 316,676,521 Stores, spare parts ** 85,335,801 84,309,630 Packing Material 804,273,863 741,036,842 Storage charges 52,747,726 68,008,023 Processing charges, Fabrication & Labour Charges 198,261,111 178,382,652 Repairs and maintenance :Buildings 5,600,522 2,765,798 Plant and machinery 23,316,162 18,798,998 Others 13,387,771 11,842,728

42,304,455 33,407,524 Insurance 36,278,859 34,831,536 Rent 17,647,207 12,181,363 Rates and taxes 37,563,057 10,743,230 Payment to and provision for employees :Salaries, wages and bonus 278,108,189 215,146,937 Contribution to provident and other funds 27,353,732 20,894,563 Provision for gratuity in respect of directors 346,982 349,438 Workmen and staff welfare expenses 14,782,431 19,408,880

320,591,334 255,799,818

Schedule 17 OPERATING AND OTHER EXPENSES

Gratuity - In respect of Directors 2,273,058 1,926,076 - Balance liability to the Employees Gratuity Fund 5,719,313 2,801,292

Accumulated and unavailed leave 19,503,728 14,668,435 Proposed dividend 161,680,155 – Tax on proposed dividend 26,855,074 – Share of Joint Venture (Refer Note 5(b), Schedule 22) 929,330 457,161 Total 216,960,658 19,852,964

Schedule 13 PROVISIONS

Voluntary Retirement CompensationOpening Balance 11,561,692 28,963,562 Add: Incurred during the year – – Less: Amortized during the year (11,561,692) (17,401,870)

– 11,561,692 Total – 11,561,692

Schedule 14 MISCELLANEOUS EXPENDITURE (to the extent not written off or adjusted)


Schedules annexed to and forming part of the Consolidated Financial StatementSchedules annexed to and forming part of the Consolidated Profit and Loss Account(Amount in Rupees)

2009–2010 2008–2009

Directors' sitting fees 684,500 624,196 Commission to Chairman, Managing Director and Joint Managing Director 20,948,661 – Lease rentals 1,344,900 1,338,300 Freight outward 724,478,917 805,036,176 Commission on sales 106,644,526 113,680,839 Discounts and rebates 67,805,824 41,597,319 Advertisement expenses 1,280,738 2,348,669 Donations 2,757,500 259,500 Legal and Professional fees 51,381,377 53,871,530 Royalty 62,949,838 59,980,689 Marketing fees 95,242,595 6,699,241 Miscellaneous expenses 210,153,310 196,222,390 Bad debts and advances written off 13,223,848 (579,876)Less: Provision for doubtful debts/advances utilised (9,275,000) –

3,948,848 (579,876)Provision for doubtful debts / advances 27,752,380 16,114,073 Bank charges and commission 259,936,587 214,616,302 Exchange loss - others (net) – 89,587,321 Share of Joint Venture (Refer Note 5(b), Schedule 22) 55,726,974 34,413,502 Total 21,221,336,084 25,972,371,296* includes gain on derivative contract Rs. NIL (Previous year gain of Rs. 34,531,629).** include stores and spares consumed for repairs and maintenance of plant and machinery, not separately ascertained.

Schedule 17 OPERATING AND OTHER EXPENSES (Contd...)

Opening stock of finished goods, work-in-progress and scrap 1,002,322,043 730,140,116 Opening stock of Subsidiary acquired during the year – 167,656,956 Closing stock of finished goods, work-in-progress and scrap 1,240,973,426 1,002,322,043Total (238,651,383) (104,524,971)

Schedule 18 DECREASE/(INCREASE) IN STOCKS

Amortisation of Voluntary Retirement Scheme compensation 11,561,692 17,401,870 Total 11,561,692 17,401,870

Schedule 20 EXCEPTIONAL ITEMS

On loans for fixed periods 100,162,272 32,437,327 On other loans / facilities 508,639,976 791,874,572

608,802,248 824,311,899 Less: Interest earned- gross (tax deducted at source Rs. 61,106,411) (Previous year Rs.88,389,727)On bank deposits * (265,943,393) (349,707,272)Others (10,869,572) (62,105,638)

(276,812,965) (411,812,910)Total 331,989,283 412,498,989* On deposits under lien against working capital and margin monies held against letters of credit for Company's import of raw

materials.

Schedule 19 INTEREST AND DISCOUNTING CHARGES (NET)

1. Basis of Preparation of financial statements:The financial statements are prepared on accrual basis under the historical cost convention and comply in all material aspectswith the generally accepted accounting principles in India, the Accounting Standards prescribed under section 211 (3C) ofCompanies Act,1956 and the applicable provisions thereof.

2. Use of estimates:The preparation of financial statements is in conformity with generally accepted accounting principles (“GAAP”) which requiresthe management of the Company to make estimates and assumptions that affect the reported amounts of assets and liabilitiesand the disclosure of contingent liabilities on the date of the financial statements. Actual results could differ from those estimates.Any revision to accounting estimates is recognized prospectively in current and future periods.

3. Significant accounting policies:A) Basis of preparation and principles of consolidation:

The Consolidated Financial Statements relate to Apar Industries Limited (the Company) and its subsidiary companies viz.Poweroil Speciality Products FZE, a company incorporated in Sharjah, Uniflex Cables Limited, a Company incorporated in Indiaand its downstream subsidiary Marine Cables and Wires Private Limited, Petroleum Specialities Pte. Ltd., a companyincorporated in Singapore and its downstream subsidiary viz. Quantum Apar Speciality Oils Pty. Ltd., a company incorporatedin Australia. It also includes 50% share in Apar Chematek Lubricants Ltd., a company incorporated in India, 50:50 JointVenture with Chematek S.p.A Italy (hereinafter referred to as the ‘Group’). The Consolidated Financial Statements have been prepared on the following basis:i) Subsidiaries

The financial statements of the Company and its subsidiary companies have been combined on a line-by-line basis byadding together the book values of like items of assets, liabilities, incomes and expenses, after eliminating intra groupbalances, intra group transactions and also resulting unrealized profits or losses. The consolidation procedures are inaccordance with the requirements of Accounting Standard 21 – ‘Consolidated Financial Statements’, notified by theCompanies Accounting Standard Rules, 2006.The excess of the cost to the Company of its investment in Subsidiary / Associate companies over its share of the equityof the subsidiary companies at the dates on which the investments in the subsidiary companies are made, is recognizedas ‘Goodwill’ being an asset in the consolidated financial statements. Alternatively, where the share of equity in theSubsidiary / Associates companies as on the date of investment is in excess of cost of investment of the Company, it isrecognized as ‘Capital Reserve’ and shown under the head ‘Reserves and Surplus’, in the consolidated financialstatements.Minority interests in the net assets of consolidated subsidiaries consists of the amount of equity attributable to theminority shareholders at the dates on which investments are made by the Company in the subsidiary companies andfurther movements in their share in the equity, subsequent to the dates of investments.In case of foreign subsidiaries, revenue items are consolidated at the average exchange rates that prevailed during eachmonth of the year. All assets and liabilities are converted at the rates prevailing at the end of the year. Exchange gainsand losses arising on conversion are recognized in the Exchange fluctuation reserve. The financial statements of theSubsidiary /Joint Venture considered for consolidation are drawn up to the same reporting date as that of the Company.The Consolidated Financial Statements are prepared using uniform accounting policies for like transactions and otherevents in similar circumstances and are presented to the extent possible, in the same manner as the Company’s standalone financial statements.

ii) Joint VentureInterest in a jointly controlled entity is accounted using proportionate consolidation method.

iii) Investment in AssociatesInvestments in entities in which the parent company or any of its subsidiaries has significant influence but not a controllinginterest, are reported according to the equity method i.e. investment is initially recorded at cost, identifying any goodwillarising at the time of acquisition. The carrying amount of investment is adjusted thereafter for the post acquisitionchange in the investor’s share of net assets of the investee. The consolidated profit and loss account includes the investor’sshare of the results of the operations of the investee.

B) Fixed assets, Depreciation and Amortization:i) Fixed assets are stated at cost of acquisition / construction (net of CENVAT) less accumulated depreciation. Cost includes

Schedule 21 SIGNIFICANT ACCOUNTING POLICIES


Schedules annexed to and forming part of the Consolidated Financial StatementSchedules annexed to and forming part of the Consolidated Financial Statement

purchase price and other costs attributable to acquisition / construction of fixed assets. ii) Depreciation on assets is provided at the rates and in the manner prescribed under Schedule XIV of the Companies Act,

1956 (except as stated in (iii) below):a) in respect of assets of Uniflex Cables Limited on straight line method, and;b) in respect of assets of other Divisions, on written down value method except in respect of building and plant and

machinery purchased after 30.4.1987, which are depreciated on straight line method.c) Capital Expenditure in respect of which ownership does not vest with the Company is amortized over a period of five

years. Leasehold land is amortized over the period of lease.d) Certain items of plant and machinery which have been considered to be continuous process plant by the management

are depreciated at the prescribed rates.iii) In the cases where the estimated useful life of the asset is less as compared to useful life estimated in Schedule XIV of

the Companies Act, 1956, such assets are depreciated at rates higher than those prescribed under Schedule XIV of theCompanies Act, 1956.Asset RateFactory building at Nalagarh Over the lease period

iv) In respect of assets costing less than Rs. 5,000 each and temporary structures, 100% depreciation is provided in the yearof addition.

v) Borrowing costs attributable to acquisition/construction of qualifying assets within the meaning of the accountingstandard 16 on “borrowing costs” are capitalised as a part of the cost of fixed assets.

vi) Pre-operation expenses including trial run expenses (net of revenue) are capitalized.C) Impairment of assets:

The Group assess, at each balance sheet date, whether there is any indication of impairment of the carrying amount of theGroup’s assets. An impairment loss is recognized in the profit and loss account wherever the carrying amount of the assetsexceeds its estimated recoverable amount. The recoverable amount is greater of the net selling price and value in use. Inassessing value in use, the estimated future cash flows are discounted to their present value, based on an appropriatediscounting factor. Impairment losses are recognized in the profit and loss account. The impairment loss recognized in prioraccounting period is reversed if there has been change in recoverable amount.

D) Investments:Investments other than in subsidiaries, Joint Ventures and Associates have been accounted as per Accounting Standard (AS)13 “Accounting for Investments”.

E) Inventories :Inventories are valued at standard cost basis except of a subsidiary Uniflex Cables Limited where it is valued on FIFO basis.As on 31.03.2010, Uniflex Cables Limited is carrying 12% of Group inventories. Inventories are valued at lower of cost andnet realisable value (cost of finished goods includes material cost, cost of labour and attributable manufacturing overheads)on the basis of full absorption costing. Cost of materials is arrived at on weighted average basis. Inventory of scrap is valuedat estimated realisable value. Inventories of Finished Goods include excise duty as applicable.

F) Government Grants: i) Government grants are recognised in the financial statements when they are received and there is reasonable assurance

that the Company will comply with the conditions attached to them.ii) Government grants, which are in the nature of refundable interest free loans received from government/semi-government

authorities, are credited to secured/unsecured loans.iii) Government grants which are in the nature of subsidies received from government/semi-government authorities and

which are non-refundable are credited to reserves.G) Employee stock options:

In respect of the employee stock options, the excess of fair price on the date of grant over the exercise price is recognizedas deferred compensation cost amortized over vesting period.

Schedule 21 SIGNIFICANT ACCOUNTING POLICIES (Contd...)H) Voluntary Retirement Schemes:

Compensations paid under voluntary retirement schemes are amortized over a period not exceeding 5 years, up to 31stMarch,2010.

I) Enterprise Resource Planning Cost:Cost of implementation of ERP Software including all related direct expenditure is amortized over a period of 5 years onsuccessful implementation.

J) Share Issue Expenses:Share issue expenses are written off against share premium account if any or amortized over a period of 5 years.

K) Revenue recognition:i) Sale of goods is recognised on despatch to customers and on date of shipment in case of exports. Sales exclude amounts

recovered towards sales tax and excise duty and is net of returns.ii) Price variation claims are accounted in accordance with the terms of contract and/or upon admittance by customers.iii) Dividend income on investment is recognised when the right to receive payment is established.iv) In respect of service activities, income is recognised as and when services are rendered.

L) Post-employment benefits:Defined Contribution Plans: In respect of the Company’s provident fund scheme, the Company makes specified monthlycontributions towards employee provident fund directly to the Government under the Employees Provident Fund Act, 1952and is not obliged to bear the shortfall, if any, between the return on investments made by the Government from thecontributions and the return on notified interest rate. In respect of the Company’s approved superannuation scheme, theCompany makes specified contributions to the superannuation fund administered by the Company and the return oninvestments is adequate to cover the commitments under the scheme. The Company’s contribution paid/payable underthese schemes is recognized as expense in the profit and loss account during the period in which the employee renders therelated service.Defined Benefit Plans: In respect of the Company’s gratuity and leave wages schemes, the present value of the obligationunder such scheme is determined based on actuarial valuation using the Projected Unit Credit Method. The discount ratesused for determining the present value of the obligation is based on the market yields on Government securities as at thebalance sheet date. Actuarial gains and losses are recognized immediately in the Profit & Loss Account. Long termcompensated absences are provided for based on actuarial valuation, made at the year end, by independent actuaries.

M) Translation of foreign currency :i) The Group translates foreign currency transactions during the year, at the conversion rates prevailing on transaction

dates.ii) Monetary items remaining unsettled at the year end are translated/reported at the year end rate. Exchange differences

arising on such revaluation are recognised in the Profit and Loss Account. iii) Non-Monetary items (other than fixed assets) are reported at the exchange rate at which they are accounted.iv) In case of forward contracts, premium on the forward contracts is recognized as income or expense over the life of the

contract. N) Hedging transactions (Metals):

All gains or losses in respect of hedging transactions are recognised in the financial statements on settlement/squaring off.Commission etc. in respect of such transactions is accounted on accrual basis.

O) Export benefits/Incentives: The Group accounts for excise duty rebate on deemed and physical exports and duty entitlements/focus benefits on physicalexports on accrual basis. Premium on special import licence is credited in the accounts as and when realised. The benefitsin the form of entitlements to Advance Licenses for duty free import of raw materials in respect of exports made are accountedwhen such imports are made.

P) Claims against the Group not acknowledged as debts: The demands under disputed showcause notices / orders of statutory authorities are provided in the accounts on the basisof management's estimate and the balance, if any are included in contingent liability.

Schedule 21 SIGNIFICANT ACCOUNTING POLICIES (Contd...)


Schedules annexed to and forming part of the Consolidated Financial StatementSchedules annexed to and forming part of the Consolidated Financial StatementSchedule 21 SIGNIFICANT ACCOUNTING POLICIES (Contd...) Schedule 22 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd...)

Q) Taxes on income:Provision for taxation is made for both current and deferred taxes. Provision for current tax is made, at current rate of tax,based on assessable income. Deferred tax resulting from timing differences between the book profits and the tax profits isaccounted for to the extent that the timing differences are expected to crystallize. Deferred tax assets are not recognised on unabsorbed depreciation and carry forward losses unless there is virtual certaintythat sufficient future taxable income will be available against which such deferred tax assets will be realized.

R) Provision for contingencies:A provision is recognized when there is a present obligation as a result of a past event, it is probable that an outflow ofresources will be required to settle the obligation and in respect of which reliable estimates can be made. Disclosure ofcontingent liability is made when there is a possible obligation or a present obligation that may but probably will not requirean outflow of resources. When likelihood of such outflow is remote, no provision or disclosure is made. Provision arising fromlitigations, assessments by statutory authorities, etc. is made when the Group, based on legal advise, wherever necessaryestimates that the liability has been incurred and the amount can be reasonably estimated.

As at 31.03.2010 As at 31.03.20092. Estimated amount of contracts remaining to be

executed on capital account and not provided for (Net of advances) 10,371,364 21,432,318

2009-10 2008-09a) i) Delayed payments due - Principal amount 96,035 1,537,851

ii) Interest due on the above 1,178 18,251b) Total interest paid on all delayed payments during

the year under the provision of the Act – – c) Interest due on principal amounts paid beyond the due date during the year but

without the interest amounts under this Act 18,251 1,390d) Interest accrued but not due – – e) Total interest due but not paid 1,178 18,251

3. Disclosure required under the Micro, Small and Medium Enterprises Development Act, 2006 are given as follows:


1. Contingent liabilities not provided for :a) Bills of exchange discounted 1,311,439,622 1,584,082,553 b) Taxation:

Disputed demands of income tax 17,640,853 17,851,595 c) Claims against the Group not acknowledged as debts -

i) Demand/ Show cause-cum-demand notices received and contested by the Group with the relevant appellate authorities:Excise Duty (also refer item (iii) below) 38,334,056 16,819,156 Service Tax 1,984,896 1,984,896 Custom duty 65,321,089 65,321,089 Sales tax 56,012,976 59,080,673

ii) Arbitration award regarding dispute of alleged contractual non performance by the Company, against which the Company is in appeal before Bombay High Court. 65,631,906 61,048,671

iii) Interest on delayed payment of Excise duty, (which duty payment was revenue neutral) on certain Deemed Exports as per settlement commission's order against which the Company is in appeal before Bombay High Court. 44,507,841 44,507,841

iv) Demand/ charges levied by the Local Authorities – 2,000,000 v) Labour matters 16,621,439 16,621,439 vi) Others 46,796,910 46,796,910

Schedule 22 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Amount in Rupees)

4. I) Category wise quantitative data about derivative instruments outstanding as at March 31, 2010Type of Instrument Nos. Mt. Amount $/Euro Amount INR

a). In respect of Commodity Futures/ Options at London Metal 89 14,161 39,913,064 1,792,495,700 Exchange (in Mt.) - USD (108) (25,100) (67,674,053) (3,428,367,512)

b). In respect of Foreign currencyForward contracts - buy contracts - USD 84 143,041,125 6,423,976,916

(62) (146,327,135) (7,412,932,659)Forward contracts - sale contracts - EURO – – –

(1) (500,000) (33,714,000)Currency Swap – EURO/USD – EURO 2 1,700,000 102,795,600

(10) (12,965,000) (874,204,020)Options – USD – – –

(1) (6,000,000) (303,960,000)II) All the derivative instruments entered by the Group

during the year were for hedging purpose and not for any speculative purpose.

III) Unhedged foreign currency exposure as at 31st March, 2010In US $ - Payable (Net) 29,887,032 1,342,226,627

(27,458,986) (1,399,939,808)In Euro - Payable (Net) 1,850,385 111,889,081

(3,283,577) (221,405,012)IV) Premium in case of forward contracts not expired 44,357,855

and pertaining to the future period (49,427,415)(Figures in bracket are for year ended 31.03.2009)

4A.The Company has entered into non-speculative commodity forward contract in order to hedge its exposure to fluctuations inthe metal prices against requisite firm price sales contracts (received / to be received) for its conductor segment. The mark tomarket loss on such contracts, in accordance with the announcement dated March 28, 2008, issued by the Institute of CharteredAccountants of India, amounting to Rs. 400,027,218 as at March 31, 2010 (Rs. 1,713,236,466 as at March 31, 2009), has notbeen provided in the Accounts, as in the opinion of the management such loss is notional in nature and the said loss would getextinguished on execution of firm sale price orders corresponding to these commodity forward contracts.

5. The Consolidated Financial Statements have been prepared in accordance with Accounting Standard 21 (AS 21) - "ConsolidatedFinancial Statements" and Accounting Standard 27 (AS 27) - "Financial Reporting of Interest in Joint Ventures" notified byCompanies (Accounting Standards) Rules, 2006.a) The subsidiaries (which along wih Apar Industries Limited, the parent, constitute the Group) considered in the consolidated

financial statements are:Name of the Company Country of % voting power % voting power

Incorporation held as on held as onMarch 31, 2010 March 31, 2009

Petroleum Specialities PTE Ltd. Singapore 100 100Quantum Apar Speciality Oils Pty Ltd - (Subsidiary of Petroleum Specialities PTE Ltd.) Australia 65 65Poweroil Speciality Products FZE U.A.E 100 100Uniflex Cables Limited India 65.47 65.47Marine Cables & Wires Private Limited (100% subsidiary of Uniflex Cables Limited) India 65.47 65.47


Schedules annexed to and forming part of the Consolidated Financial StatementSchedules annexed to and forming part of the Consolidated Financial StatementSchedule 22 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd...) Schedule 22 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd...)

b) Interests in Joint VenturesThe Group’s interests in jointly controlled entity (incorporated Joint Venture) is:Name of the Company Country of % of ownership % of ownership

Incorporation interest as at interest as atMarch 31, 2010 March 31, 2009

Apar Chematek Lubricants Limited India 50 50

(Amount in Rupees)Particulars As at 31.03.2010 As at 31.03.2009

I. Assets1. Fixed Assets 1,542,767 1,414,332 2. Investments – –3. Deferred Tax (Liability)/ Asset (Net) (36,151) 13,092,116 4. Current Assets, Loans and Advances

a) Sundry Debtors 23,342,729 – b) Cash and Bank Balances 3,451,029 1,935,764 c) Loans and Advances 13,646,816 3,338,966

II Liabilities1. Shareholders' Funds including Reserves and Surplus (32,893,792) (7,901,978)2. Loans – (3,500,000)3. Current Liabilities and Provisions

a) Liabilities (8,124,068) (7,922,038)b) Provisions (929,330) (457,161)

(Amount in Rupees)Particulars For the year ended For the year ended

31.03.2010 31.03.2009III Income

1. Service income 95,242,596 3,349,621 2. Misc. Income 191,805 –

IV Expenses1. Operating and other expenses (55,726,974) (34,413,502)2. Depreciation (437,680) (295,420)3. Interest (1,149,668) (280,377)4. Profit before taxation 38,120,080 (31,639,679)5. Provision for taxation (including MAT, MAT Credit entitlement, deferred

taxation and fringe benefit tax) (13,128,267) 10,868,372 6. Net profit 24,991,814 (20,771,307)

V Other matters1. Contingent Liabilities – – 2. Capital Commitments – –

6. The Company has Goodwill of Rs. 603,083,455 on account of acquisition of Uniflex Cables Limited (UCL). The Company has takenvarious steps in area of its productivity, debottlenecking of manufacturing facility, expansion of production line and market,strengthening of managerial resources etc. and losses incurred by the UCL are reducing gradually. However, in view of thecontinuous loss and erosion of its net worth, the Company has provided Rs. 603,083,455 in the 2009 -2010 Accounts asimpairment.

7. The Compensation Committee of Directors (CCD) of the Company, at its meeting held on May 27, 2008 have granted 175,150options at an exercise price of Rs. 207.05 per option to eligible employees/Directors. The above options will vest in threeinstallments (1/3rd each) on May 27, 2009, May 27, 2010 & May 27, 2011 respectively. As of date no employee has excercisedany options. The Company has obtained in-principal approval for the listing of the entire 1,616,802 equity shares to be issuedand allotted on excercise of options as & when excercised under the scheme.

8. The exchange rate differences arising on purchases/vendor balances and those on account of sales/receivables have been groupedunder 'Raw Material Consumed' and 'Sales' respectively. Similarly exchange rate differences on other transactions have beenshown under 'Other Expenses' or 'Other Income', as the case may be. The net exchange difference gain so grouped, for the yearis Rs. 241,883,140 (Previous Year loss of Rs.1,344,055,153).

9. Related party disclosuresA. List of Related Parties

a) Joint Venture Company:Apar Chematek Lubricants Limited

b) Key Managerial Personnel:Mr. K. N. Desai - Managing DirectorMr. C. N. Desai - Jt. Managing Director Mr. G. Sudhakar - Director - Petroleum Specialities PTE. Limited Mr. Bijay Singh Baid - Ex-Chairman & Managing Director - Uniflex Cables LimitedMr. Jay Kumar Baid - Ex-Executive Director - Uniflex Cables LimitedMr. Ajay Kumar Baid - Ex-Executive Director - Uniflex Cables LimitedMr. Sanjay Kumar Baid - Ex-Executive Director - Uniflex Cables LimitedMr. V. K. Bajaj - Chief Operating Officer - Uniflex Cables LimitedMr. Vinay Kumar Baid - Ex-Director - Marine Cables & Wires Private Limited

c) Chairman having significant influence:Dr N. D. Desai - Non executive Chairman

d) Relatives of Key Managerial PersonnelMrs. Noopur Kushal DesaiMrs. Vineeta R. SrivastavaMr. Rishabh K. DesaiMrs. Jinisha C. DesaiMs. Gaurangi K. Desai Mrs. M. N. DesaiMr. Rajeev SrivastavaMr. Devharsh C. DesaiMs. Krishangi R. Srivastava

e) Entities over which significant influence is exercised by key management personnel/individuals having significantinfluence:Apar Corporation Private Limited Kushal Chaitanya Desai Family TrustScope Private Limited & its' subsidiaries, viz Chaitanya N. Desai Family Trusta) Apar Investment (Singapore) Pte. Limited Catalis World Private Limitedb) Apar Investment Inc. Apar Masat Conductors LimitedKushal N. Desai Family Trust Gayatri AssociatesApar Technologies Pte. Limited, Singapore Apar Technologies Private Limited


Schedules annexed to and forming part of the Consolidated Financial StatementSchedules annexed to and forming part of the Consolidated Financial StatementSchedule 22 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd...) Schedule 22 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd...)

B. Related Party Transactionsi) Joint Venture Company (Apar Chematek Lubricants Limited): (Amount in Rupees)

Sr. No. Transactions 2009–10 2008–091 Investment in shares – 12,912,500 2 Interest Received 1,149,668 280,377 3 Marketing fees 95,242,596 3,349,621 4 Balance outstanding as on 31.03.2010

Payable for Services 23,342,729 – Receivable for advances given 185,716 9,743,220

ii) Key managerial PersonnelSr. No. Transactions 2009–10 2008–091 Interest paid 17,257,679 8,565,457 2 Directors' remuneration 27,910,193 10,019,9833 Sitting fees 30,000 26,0004 Dividends paid (payment basis) – 50,702,644 5 Outstanding as on 31.03.2010

Loans and Deposits payable 218,500,000 157,737,831iii) Chairman having significant influence

Sr. No. Transactions 2009–10 2008–091 Interest paid 4,979,916 1,936,287 2 Director's commission 6,982,887 – 3 Sitting fees 122,000 100,0004 Legal and Professional Fees 4,600,000 4,600,0005 Dividends paid (payment basis) – 25,709,944 6 Outstanding as on 31.03.2010

Loans and Deposits payable 96,100,000 48,100,000iv) Relatives of Key managerial Personnel

Sr. No. Transactions 2009–10 2008–091 Interest paid 7,461,317 7,840,803 2 Dividends paid (payment basis) – 705,7283 Outstanding as on 31.03.2010

Loans and Deposits 143,725,000 81,460,000v) Entities over which key management personnel/individual having significant influence

Sr. No. Transactions 2009–10 2008–091 Interest Paid 10,915,032 4,461,436 2 Rent Paid 6,300,000 6,300,000 3 Dividends paid (payment basis) – 455,436 4 Shareable expense received 961,352 – 5 Outstanding as on 31.03.2010

Receivable for advances given 6,751,658 7,751,740 Loans and Deposits taken - Unsecured 126,754,179 89,548,824

C. Disclosure in respect of transactions which are more than 10% of the total transactions of the same type with relatedparties during the year (Amount in Rupees)

2009–10 2008–09i) Interest Received

– Apar Chematek Lubricants Limited 1,149,668 280,377 ii) Investment in Shares

– Apar Chematek Lubricants Limited – 12,912,500 iii) Interest paid

– Dr. N. D. Desai 4,979,916 1,936,287 – Kushal N. Desai 7,682,087 3,104,481 – Chaitanya N. Desai 9,575,592 5,460,976 – Rishabh K. Desai 2,813,658 3,338,921 – Vineeta R. Srivastava 3,431,671 2,907,080 – Apar Investment Inc. 4,990,624 – – Apar Corporation Private Limited 5,569,188 4,290,415

iv) Dividends paid (payment basis)– Dr. N. D. Desai – 25,709,944 – Kushal N. Desai – 25,518,916 – Chaitanya N. Desai – 25,183,728

v) Legal & Professional Fees– Dr. N. D. Desai 4,600,000 4,600,000

vi) Rent Paid– Apar Corporation Private Limited 6,300,000 6,300,000

vii) Marketing fees– Apar Chematek Lubricants Limited 95,242,596 3,349,621

viii) Director Remuneration– Kushal N. Desai 13,358,944 2,983,588 – Chaitanya N. Desai 13,471,286 3,008,909 – Dr. N. D. Desai 6,982,887 – – Mr. G. Sudhakar - Director - Petroleum Specialities PTE. Limited 1,079,963 1,202,415 – Mr. Bijay Singh Baid - Ex-Chairman & Managing Director - Uniflex Cables Limited – 418,431 – Mr. Jay Kumar Baid - Ex-Executive Director - Uniflex Cables Limited – 825,880 – Mr. Ajay Kumar Baid - Ex-Executive Director - Uniflex Cables Limited – 825,880 – Mr. Sanjay Kumar Baid - Ex-Executive Director - Uniflex Cables Limited – 700,880


Schedules annexed to and forming part of the Consolidated Financial StatementSchedules annexed to and forming part of the Consolidated Financial StatementSchedule 22 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd...) Schedule 22 NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS (Contd...)10.The Group's operations predominantly relate to manufacture of Conductors, Transformer/Speciality Oils and Cables which

businesses have been identified as primary segments based on the Company's risk profile and internal reporting structure.a. Business Segments

b. Geographical Segmentsi) Revenue by geographical Market:

ii) Carrying amount of Segment Assets:

Particulars Conductor Transformer & Speciality Power/Telecom Cable Others Eliminations TotalOils

2009–10 2008-09 2009-10 2008-09 2009-10 2008-09 2009-10 2008-09 2009-10 2008-09 2009-10 2008-09REVENUEExternal Sales 94,642.48 136,542.23 110,510.92 117,285.97 18,075.73 9,437.03 325.37 440.74 – – 223,554.50 263,705.97 Other Income 1,515.18 251.00 28.57 305.37 22.38 10.82 33.88 55.46 – – 1,600.01 622.65 Inter-Segment Sales 2,424.18 1,808.38 115.37 203.32 163.96 12.70 87.21 19.94 (2,790.71) (2,044.34) 0.00 (0.00)Total Revenue 98,581.83 138,601.60 110,654.86 117,794.66 18,262.07 9,460.55 446.45 516.15 (2,790.71) (2,044.34) 225,154.50 264,328.62 RESULT Segment result 6,010.25 9,759.81 10,993.66 (3,572.58) (1,274.62) (167.08) 62.87 49.29 – – 15,792.17 6,069.44 Unallocable Corporate/Other expenses (net of miscellaneous income) (2,431.46) (2,064.80)Operating Profit 13,360.71 4,004.64Interest Expense (6,088.02) (8,243.12)Interest Income 2,768.13 4,118.13 Profit before taxes 10,040.81 (120.36)Income tax Current tax (2,152.54) (126.71)Minimum Alternate tax – (23.50)Minimum Alternate tax credit entitlement – 23.50 Prior year tax – 39.46 Deferred tax –Credit/(Charge) (86.05) (95.02)Fringe Benefit Tax – (51.79)Profit/(loss) after tax and before share of associate's loss and minority interests 7,802.22 (354.42)Share of Associate's net loss – (578.97)Minority Interest – (Profit)/Loss 672.12 401.16 Profit/(loss) after tax and before Extraordinary items 8,474.34 (532.23)Extraordinary items (net) - Income/(Expenses) - Net of income tax (6,030.83) – Profit/(loss) after tax and Extraordinary items 2,443.51 (532.23)OTHER INFORMATION Segment assets 56,028.38 64,230.52 88,418.11 98,481.81 16,985.69 14,579.79 143.08 109.50 – – 161,575.27 177,401.61 Unallocable Corporate and Other assets 9,066.05 12,231.64 Total Assets 170,641.32 189,633.26 Segment liabilities 44,540.20 58,812.54 72,170.17 79,211.71 5,872.08 5,553.99 1.08 – – – 122,583.53 143,578.23 Unallocate Corporate and other liabilities 2,796.50 612.67 Total liabilities 125,380.04 144,190.90 Capital expenditure 309.97 1,421.83 481.75 563.45 1,086.53 569.03 – – – – 1,878.24 2,554.31 Capital expenditure – unallocable 240.37 442.65 Depreciation 720.67 666.73 316.15 297.07 642.78 348.68 – – – – 1,679.60 1,312.48 Depreciation on – unallocable 171.73 159.03 Non–cash expenses/(income) other than depreciation 35.84 87.29 12.81 19.75 (110.50) – – – 110.50 – 48.65 107.04 Non-cash expenses other than depreciation - unallocable 66.97 66.98

(Rupees in Lacs) Conductor Transformer & Speciality Power/Telecom Cable Others TotalOils

2009-10 2008-09 2009-10 2008-09 2009-10 2008-09 2009-10 2008-09 2009-10 2008-09Outside India 23,665.53 44,418.91 34,698.48 30,875.32 3,991.65 3,691.13 – – 62,355.65 78,985.36 In India* 70,976.95 92,123.32 75,812.44 86,410.65 14,084.09 5,745.90 325.37 440.74 161,198.85 184,720.61 Total 94,642.48 136,542.23 110,510.92 117,285.97 18,075.73 9,437.03 325.37 440.74 223,554.50 263,705.97

(Rupees in Lacs)

Conductor Transformer & Speciality Power/Telecom Cable Others Unallocated TotalOils

2009-10 2008-09 2009-10 2008-09 2009-10 2008-09 2009-10 2008-09 2009-10 2008-09 2009-10 2008-09Outside India 2,686.13 23,865.90 17,444.47 11,522.52 420.64 969.14 – – – – 20,551.24 36,357.56 In India 53,342.25 40,364.62 70,973.64 86,959.29 16,565.05 13,610.64 143.08 109.50 9,066.05 12,231.64 150,090.08 153,275.69 Total 56,028.38 64,230.52 88,418.11 98,481.81 16,985.69 14,579.79 143.08 109.50 9,066.05 12,231.64 170,641.32 189,633.26

(Rupees in Lacs)*Include deemed exports Rs. 8,616.83 lacs (previous year Rs. 14,886.32 lacs).

Segment Revenue and ResultThe expenses which are not directly attributable to the business segment are shown as unallocable corporate/other expenses(net of miscellaneous income)Segment assets and liabilitiesSegment assets include all operating assets used by the business segment and consist principally of fixed assets, debtors andinventories. Segment liabilities primarily include creditors and other liabilities. Assets and liabilities that cannot be allocatedbetween the segments are shown as a part of unallocable corporate assets and liabilities respectively.

11.Particulars of earnings per share

12.Previous year figures have been regrouped, wherever necessary, to conform to current year's classification.

Sr. No. Particulars 2009-10 2008-091 Profit after tax and before extraordinary items - in Rs. 847,434,357.25 (53,222,905.81)2 Profit after tax and extraordinary items - in Rs. 244,350,902.17 (53,222,905.81)3 Weighted Number of Equity Shares outstanding during the year 32,336,031 32,336,031 4 Nominal Value of Equity Shares in Rs. 10 10 5 Earnings per share - in Rs.

Basic & Diluted before extraordinary items 26.21 (1.65)Basic & Diluted after extraordinary items 7.56 (1.65)




Consolidated Cash Flow Statement For the year ended March 31, 2010(Amount in Rupees)

2009-2010 2008-2009 CASH FLOW FROM OPERATING ACTIVITIES :Profit before taxation, Exceptional Items and Extraordinary Items 1,015,642,990 5,366,148Adjustments for:Depreciation/Amortisation 185,133,303 147,150,570(Profit)/Loss on Sale of Fixed Assets(Net) (1,354,911) (3,841,950)Foreign Currency Translation Reserve (30,371,367) 8,782,246 Unrealised exchange loss/(gain) (303,433,304) 901,910,828 Profit on sale of investment – (1,027,749)Dividend on investments (2,441,745) (185,493)Interest income (276,812,965) (411,812,910)Interest expense 608,802,248 824,311,899

179,521,259 1,465,287,441Operating profit before working capital changes in : 1,195,164,249 1,470,653,588Trade and other receivables 699,295,188 (818,071,654)Inventories (756,603,274) (827,655,572)Trade and other payables (1,615,737,785) (1,673,045,871) 2,664,825,834 1,019,098,608Cash generated from/(used in) operations (477,881,622) 2,489,752,197Taxes paid (including fringe benefit tax) (net of refunds) (180,884,004) (239,087,672)Net cash from/(used in) operating activities (658,765,626) 2,250,664,525CASH FLOW FROM INVESTING ACTIVITIES :Purchase of Fixed Assets (211,861,201) (299,695,500)Sale of Fixed Assets 5,075,869 9,484,843Purchase of investments in– Uniflex Cables Ltd – (252,524,180)– Apar Chematek Lubricants Ltd – (23,236,783)Investment in Mutual fund (Net) – 4,831,659 Dividend received 2,441,745 185,493 Interest Received 260,046,661 55,703,074 437,782,273 (123,172,195)Net cash from/(used in) investing activities 55,703,074 (123,172,195)CASH FLOW FROM FINANCING ACTIVITIES :Proceeds/(repayments) from/of fixed deposits (net) 53,167,500 15,432,000 Proceeds/(repayments) from/of bank borrowings (net) 124,176,360 (331,426,196)Proceed/(repayments) from Short term borrowings 147,728,541 203,523,563 Proceed/(repayments) of long term borrowings (321,578,951) 60,684,000 Interest Paid (627,357,071) (850,281,262)Dividend Paid – (129,726,993)Tax on Dividends – (21,982,034)Net cash from/(used in) financing activities (623,863,621) (1,053,776,921)Net Increase/(Decrease) in cash and cash equivalents (1,226,926,173) 1,073,715,409Cash and cash equivalents at the beginning of year 6,109,244,758 4,920,032,732Cash and cash equivalents on acquisition of subsidiaries – 115,496,617Cash and cash equivalents at the end of year 4,882,318,585 6,109,244,758

As per our report of even date attached.For Price Waterhouse For and on behalf of the Board of DirectorsChartered AccountantsFirm Registration No.: 301112E


Notes : 1) Previous year figures have been regrouped/restated wherever necessary to conform to the current year presentation.2) Refer Schedule 10 of financial statements for composition of cash and bank balances. 3) Cash and cash equivalents include margin money of Rs. 3,945,352,601 (Previous year Rs. 3,066,785,549) - Refer Note under Schedule

10 ‘Cash and Bank Balances’.

apar janta annual report 2009-10 - bombay stock exchangeannual report 2009-10 3 notice is hereby...

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