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ANNUAL REPORT

2 0 10

THE

INDIA CEMENTS

LIMITED

A REQUEST

The practice of distributing copies of Annual

Report at the Annual General Meeting has been

discontinued in view of the high cost of paper

and printing. Shareholders are, therefore,

requested to bring their copy of the Annual Report

to the meeting.

64th Annual General Meeting

Date : 2nd August 2010

Time : 10.00 A.M

Venue : Sathguru Gnanananda Hall

(Narada Gana Sabha)

No.314, T.T.K. Road

Alwarpet

Chennai 600 018

CONTENTS Page No.

Notice to Shareholders 2

Ten Years in Brief – Financial Information 10

Directors’ Report 11

Corporate Governance 26

Auditors’ Report 42

Balance Sheet 46

Profit & Loss Account 47

Schedules 48

Cash Flow Statement 71

Statement pursuant to Sec. 212 of theCompanies Act, 1956 73

Information in aggregate of each Subsidiary 74

Auditors’ Report on the ConsolidatedFinancial Statements 75

Consolidated Balance Sheet 76

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BOARD OF DIRECTORS Sri N.Srinivasan Vice Chairman & Managing Director

Mrs Chitra Srinivasan

Ms Rupa Gurunath Wholetime Director

Dr. B.S.Adityan

Sri Arun Datta

Sri R.K.Das

Sri N.R.Krishnan

Sri V.Manickam (Nominee of Life Insurance Corporation of India)

Sri K.P.Nair (Nominee of IDBI Bank Limited)

Sri A.Sankarakrishnan

Sri N.Srinivasan

Sri K.Subramanian (Nominee of Housing and Urban Development Corporation Limited)

Auditors Messrs Brahmayya & Co. andMessrs P.S. Subramania Iyer & Co.,Chartered AccountantsChennai.

Registered Office Cement Factories

“Dhun Building” TAMIL NADU ANDHRA PRADESH827, Anna Salai Sankarnagar, Chilamakur & Yerraguntla,Chennai - 600 002.

Tirunelveli District. Cuddapah District.

Sankari, Vishnupuram,Corporate Office Salem District. Nalgonda District.

“Coromandel Towers” Dalavoi, Malkapur,93, Santhome High Road, Perambalur District. Ranga Reddy District.Karpagam Avenue, R.A. Puram Grinding UnitsChennai - 600 028.

TAMIL NADU MAHARASHTRA

Vallur Village, Parli Vaijynath,Tiruvallur District. Beed District.

THE INDIA CEMENTS LIMITED

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NOTICE TO SHAREHOLDERSNOTICE is hereby given that the Sixtyfourth Annual General Meeting of The India Cements Limited will be held at10.00 A.M. on Monday, the 2nd August 2010, at Sathguru Gnanananda Hall, (Narada Gana Sabha), No.314, T.T.K.Road, Alwarpet, Chennai 600 018, to transact the following business:

ORDINARY BUSINESS:

1. To receive, consider and adopt the Directors' Report, the accounts of the Company for the year ended 31st

March2010 and the Auditors' Report thereon.

2. To declare dividend on equity shares.

3. To appoint a Director in the place of Sri V.Manickam who retires by rotation and is eligible for reappointment.

4. To appoint a Director in the place of Sri A.Sankarakrishnan who retires by rotation and is eligible for reappointment.

5. To appoint a Director in the place of Sri N.R.Krishnan who retires by rotation and is eligible for reappointment.

6. To appoint Auditors and fix their remuneration:

To consider and if thought fit, to pass with or without modification the following resolution as an ORDINARYRESOLUTION:

"RESOLVED THAT M/s.Brahmayya & Co. (Registration No. 000511S) and M/s.P.S.Subramania Iyer & Co.,(Registration No. 004104S) Chartered Accountants, Chennai, be and are hereby appointed Auditors of theCompany including its branch offices to hold office from the conclusion of the sixtyfourth Annual General Meetinguntil conclusion of the sixtyfifth Annual General Meeting and that their remuneration be and is hereby fixed atRs.40,00,000/- each, exclusive of service tax and all travelling and out of pocket expenses which shall bereimbursed to them."

SPECIAL BUSINESS:

7. To appoint Sri Arun Datta as a Director of the Company and for that purpose to consider and if deemed fit, topass the following ORDINARY RESOLUTION of which notice has been received from a member of the Companyas required under Section 257 of the Companies Act, 1956:"RESOLVED THAT Sri Arun Datta be and is hereby appointed as a Director of the Company subject to retirementby rotation."

8. To appoint Mrs.Chitra Srinivasan as a Director of the Company and for that purpose to consider and if deemedfit, to pass the following ORDINARY RESOLUTION of which notice has been received from a member of theCompany as required under Section 257 of the Companies Act, 1956:"RESOLVED THAT Mrs.Chitra Srinivasan be and is hereby appointed as a Director of the Company subject toretirement by rotation."

9. To consider and if thought fit, to pass with or without modification the following resolutions as ORDINARYRESOLUTIONS:"RESOLVED THAT subject to the consent of the financial institutions, and other approvals as may be requiredand pursuant to the provisions of Sec.198, 269, 309 and 310 read with Schedule XIII and other applicableprovisions, if any, of the Companies Act, 1956, the Company hereby accords its approval and consent for theappointment of Ms.Rupa Gurunath as wholetime director of the Company for a period of 5 years with effect from5th March, 2010 and for the payment of remuneration to her for her services as wholetime director as set outhereunder:

SALARY : Rs.10 lakhs per month.

COMMISSION: Such percentage of commission (in addition to Salary, allowances, perquisites and benefitshereinafter stated) calculated with reference to the net profit of the Company for each financial

THE INDIA CEMENTS LIMITEDRegistered Office: "Dhun Building", 827, Anna Salai, Chennai 600 002.

Corporate Office : "Coromandel Towers", 93, Santhome High Road,Karpagam Avenue, R.A. Puram, Chennai 600 028.

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year as may be fixed by the Board of Directors which together with salary and monetary valueof allowances, perquisites and benefits shall not exceed the ceiling laid down under Sec.309 ofthe Companies Act, 1956.

ALLOWANCES : 1. Housing: Rent free accommodation will be provided to the wholetime director for whichAND OTHER 10% of salary will be recovered. In case no accommodation is provided by the Company,PERQUISITES house rent allowance at 30% of salary, shall be paid. In addition, the wholetime director

shall be allowed free use of the Company owned furniture and other consumer durables,as required.

2. The wholetime director will also be entitled to other allowances and perquisites togetherwith reimbursement of expenses or allowances for utilities such as gas, electricity, water,furnishings and repairs, medical reimbursement, leave travel allowance for self and family,club fees, personal accident insurance and such other perquisites and allowances inaccordance with the rules of the Company or as may be agreed to by the Board ofDirectors with the wholetime director, so however, that the value of such perquisites andallowances will be subject to a maximum of 45% of the annual salary.

Perquisites and allowances shall be evaluated as per income-tax rules, whereverapplicable. In the absence of any such rules, perquisites and allowances shall be evaluatedat actual cost. Provision for use of Company's car for official duties and telephone, tele-fax, audio/video conferencing and other communication facilities at residence shall notbe included in the computation of perquisites and allowances for the purpose of calculatingthe said ceiling.

Company's contribution to Provident Fund and Superannuation Fund to the extent theseeither singly or together are not taxable under the Income-tax Act, gratuity payable asper the rules of the Company applicable to senior management personnel and encashmentof leave at the end of tenure shall not be included in the computation of limits for theallowances or perquisites aforesaid."

"RESOLVED FURTHER THAT the Board of Directors be and is hereby authorized to vary, from time to time thepercentage and quantum of the commission payable to the wholetime director, provided that the total remunerationpayable whether by way of salary, perquisites, commission, allowances and benefits, shall not exceed the ceilinglaid down under Sec.309 of the Companies Act, 1956."

"RESOLVED FURTHER THAT in the event of loss or inadequacy of profits in any financial year, the Companywill pay remuneration by way of salary, allowances, perquisites and benefits as specified above, subject toobtaining other requisite approvals."

"RESOLVED FURTHER THAT the scope and quantum of remuneration specified hereinabove, may be enhanced,enlarged or varied by the Board of Directors, in the light of and in conformity with any amendments to the relevantprovisions of the Companies Act, 1956 and / or the rules and regulations made thereunder and /or such guidelines asmay be announced by Government of India, from time to time."

10. To consider and if thought fit, to pass with or without modification, the following resolutions as ORDINARYRESOLUTIONS:

"RESOLVED THAT consent of the Company be and is hereby accorded in terms of Section 293(1)(a) and otherapplicable provisions, if any, of the Companies Act, 1956, to mortgaging and / or charging by the Board ofDirectors of the Company and / or conferring power to enter upon and to take possession of the assets of theCompany in certain events to or in favour of Axis Bank Limited or the Security Trustee as may be instructed bythe Bank to secure their External Commercial Borrowing (ECB) facility of US$ 20 Million by way of a first mortgageand charge on pari passu basis on all the movable (other than current assets) and immovable assets of theCompany together with all interest, liquidated damages, costs, charges and expenses and all other moneys

4

whatsoever due and payable by the Company to the aforesaid bank in terms of the letters of sanction / ECB loanagreement / Security Trustee agreement / hypothecation agreement entered into / to be entered into by theCompany in respect of the said loan."

"RESOLVED FURTHER THAT the Board of Directors of the Company be and is hereby authorised to finalisewith the said bank the documents for creating the aforesaid mortgage and/or charge and to do all such acts andthings as may be necessary for giving effect to the above resolution."

11. To consider and if thought fit, to pass with or without modification, the following resolution as a SPECIALRESOLUTION:

"RESOLVED THAT in pursuance of section 163 of the Companies Act, 1956, the Register of Members, theIndex of Members, the Register and Index of Debentureholders and copies of all annual returns prepared underSection 159 of the Companies Act, 1956 together with copies of the certificates and documents required to beannexed thereto under Sections 160 and 161 and other applicable provisions of the Act, be shifted from "TaraporeTowers", First Floor, 826, Anna Salai, Chennai 600002 and kept at "Coromandel Towers", 93, Santhome HighRoad, Karpagam Avenue, R.A.Puram, Chennai 600028, the Corporate Office of the Company."

NOTES:

1. Explanatory Statement is annexed to the Notice of the Sixtyfourth Annual General Meeting of the Company asrequired by Section 173(2) of the Companies Act, 1956 in respect of item nos.7 to 11.

2. Details pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges in respect of Directors seekingappointment/ reappointment at the Annual General Meeting are separately annexed hereto for items no. 3 to 5 &7 to 9.

3. ANY MEMBER ENTITLED TO ATTEND AND VOTE IS ENTITLED TO APPOINT A PROXY TO ATTEND ANDVOTE INSTEAD OF HIMSELF/HERSELF AND THE PROXY NEED NOT BE A MEMBER. THE PROXIESSHOULD, HOWEVER, BE DEPOSITED AT THE REGISTERED OFFICE OF THE COMPANY NOT LATERTHAN 48 HOURS BEFORE THE COMMENCEMENT OF THE MEETING.

4. The Register of Members and Share Transfer Books of the Company will remain closed from 28th July, 2010 to2nd August, 2010 (both days inclusive).

5. The Equity dividend, if declared, will be paid on or before 31st August, 2010 to those Members (or their mandatees)whose names will appear in the Company's Register of Members as on 2nd August, 2010. In respect of sharesheld in electronic form, the dividend will be paid on the basis of beneficial ownership as per details furnished bythe depositories for this purpose.

6. Members are requested to contact the Registrar and Share Transfer Agent for all matters connected with theCompany's shares at: Integrated Enterprises (India) Limited, 2nd Floor, 'Kences Towers', No.1, RamakrishnaStreet, North Usman Road, T. Nagar, Chennai 600017. Tel.: 044-28140801 to 28140803 & Fax : 044-28142479Email: corpserv@iepindia.comMembers holding shares in physical form are requested to notify change of address, if any, to the Registrar andShare Transfer Agent (RTA). Members holding shares in physical form in more than one folio are requested towrite to the RTA immediately enclosing their share certificates for consolidation of their holdings into one folio. Inorder to provide protection against fraudulent encashment of dividend warrants, Members are requested toprovide, if not already provided, their bank account number, name of the bank and address of the branch,quoting their folio numbers, to the Registered Office/Corporate Office of the Company or RTA.

7. Members holding shares in the dematerialised mode are requested to intimate all changes with respect to theirbank details, mandate, nomination, power of attorney, change of address, etc. to their Depository Participant(DP).These changes will be automatically reflected in the Company's records.

8. Unclaimed dividends upto and including for the financial year 1994-95 have been transferred to the GeneralRevenue Account of the Central Government. Shareholders who have not encashed their dividend warrantsrelating to financial year(s) upto 1994-95 may claim the same from the Registrar of Companies, Tamil Nadu-I,Chennai, No.26, Haddows Road, Chennai 600006, in the prescribed form which will be supplied by the Company/RTA on request.

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9. Unclaimed dividends for the financial years from 1995-96 to 2000-01 have been transferred to Investor Educationand Protection Fund. Dividend for the financial years ended 31st March, 2007, 31st March, 2008 and 31stMarch, 2009 which remain unpaid or unclaimed for a period of 7 years will be transferred to the Investor Educationand Protection Fund established under Section 205C of the Companies Act, 1956. Shareholders who have notencashed the dividend warrant(s) so far for the financial years ended 31st March, 2007, 31st March, 2008 and31st March, 2009 are requested to make their claim forthwith to the Registered / Corporate Office of the Company/RTA. It may be noted that once the unclaimed dividend is transferred to the Investor Education and ProtectionFund, as above, no claim shall lie in respect thereof.

10. Under the provisions of Section 109A and 109B of the Companies Act, 1956, shareholder(s) is/are entitled tonominate in the prescribed manner, a person to whom his/her/their shares in the Company, shall vest after his/her/their lifetime. Members who are holding shares in physical form and are interested in availing this nominationfacility are requested to write to the Company/RTA.

11. The Company has been providing ECS facility to all shareholders, holding shares in electronic and physical forms.As per RBI’s notification, with effect from 1st October 2009, the remittance of money through ECS has beenreplaced by National Electronic Clearing Service (NECS). NECS operates on the new and unique bank accountnumber allotted by banks post implementation of the Core Banking Solutions (CBS). Pursuant to implementationof CBS, your bank account number may have undergone a change, which is required to be communicated byyou to your Depository Participant (in case of shareholders holding shares in dematerialised form) or to theCompany’s Share Transfer Agent (in case of shareholders holding shares in physical form).

12. Members are requested to note that in case of transfers, deletion of name of deceased shareholder, transmissionand transposition of names in respect of shares held in physical form, submission of photocopy of PAN Card ofthe transferee(s), surviving holder(s), legal heir(s) and joint holder(s) respectively, along with necessary documentsat the time of lodgement of request for transfer/transmission/transposition, is now mandatory.

(By order of the Board)for THE INDIA CEMENTS LIMITED

Place: Chennai G BALAKRISHNANDate : 30th April, 2010 President & Company Secretary

PURSUANT TO CLAUSE 49 OF THE LISTING AGREEMENT WITH THE STOCK EXCHANGES, FOLLOWING INFORMATIONARE FURNISHED ABOUT THE DIRECTORS PROPOSED TO BE APPOINTED / REAPPOINTED,VIDE ITEMS NO. 3 to 5 & 7to 9 OF NOTICE DATED 30TH APRIL 2010.

(i) Name of the Director : Sri V. ManickamDate of Birth : 1st April 1952Date of appointment on the Board as Director : 31st October 2008Date of last reappointment as Director : Not ApplicableExpertise in specific functional areas : InvestmentQualification : B.Sc., A.C.A.Number of Equity Shares held in the Company by theDirector or for other persons on a beneficial basis : NilList of outside Directorships held in Public Companies : EID Parry (India) LimitedChairman / Member of the Committees of Board of : NilDirectors of the CompanyChairman / Member of the Committees of Board of : NilDirectors of other Companies in which he is a DirectorRelationship with other Directors : Nil

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(ii) Name of the Director : Sri A. Sankarakishnan

Date of Birth : 27th October 1942

Date of appointment on the Board as Director : 24th September 2007

Date of last reappointment as Director : 28th August 2008

Expertise in specific functional areas : Industry

Qualification : B.E. (Mechanical)

Number of Equity Shares held in the Company by theDirector or for other persons on a beneficial basis : 1000

List of outside Directorships held in Public Companies : 1. Allsec Technologies Limited2. India Cements Capital Limited3. India Cements Investment Services Limited4. Indo Zinc Limited

Chairman / Member of the Committees of Board ofDirectors of the Company : Nil

Chairman / Member of the Committees of Board of : 1. Allsec Technologies Limited -Directors of other Companies in which he is a Director Audit Committee - Member.

2. India Cements Capital Limited -Audit Committee - Member.

3. Indo Zinc Limited -Audit Committee - Chairman

Relationship with other Directors : Nil

(iii) Name of the Director : Sri N.R. Krishnan

Date of Birth : 20th June 1938

Date of appointment on the Board as Director : 24th September 2007

Date of last reappointment as Director : 28th August 2008

Expertise in specific functional areas : Indian Administrative Service (Retd.)

Qualification : B.Sc. (Hons.) Chemistry, M.Sc. Chemistry

Number of Equity Shares held in the Company by theDirector or for other persons on a beneficial basis : Nil

List of outside Directorships held in Public Companies : 1. Ponni Sugars (Erode) Limited2. Tamil Nadu Petroproducts Limited3. Tamil Nadu Road Development Company Limited4. Indo Zinc Limited

Chairman / Member of the Committees of Board ofDirectors of the Company : Nil

Chairman / Member of the Committees of Board of : 1. Ponni Sugars (Erode) Limited -Directors of other Companies in which he is a Director Audit Committee - Member

2. Tamil Nadu Petroproducts Limited -Audit Committee - Member

3. Tamil Nadu Road Development Company Limited -Audit Committee - Chairman

4. Indo Zinc Limited -Audit Committee - Member

Relationship with other Directors : Nil

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(iv) Name of the Director : Sri Arun DattaDate of Birth : 14th June 1947Date of appointment on the Board as Director : 28th October 2009Date of last reappointment as Director : Not ApplicableExpertise in specific functional areas : ManagementQualification : B.E. (Mechanical Engineering) & Post Graduate

Diploma in Marketing ManagementNumber of Equity Shares held in the Company by theDirector or for other persons on a beneficial basis : 1000List of outside Directorships held in Public Companies : Indo Zinc LimitedChairman / Member of the Committees of Board ofDirectors of the Company : Audit Committee - MemberChairman / Member of the Committees of Board ofDirectors of other Companies in which he is a Director : NilRelationship with other Directors : Nil

(v) Name of the Director : Mrs. Chitra SrinivasanDate of Birth : 31st July 1949Date of appointment on the Board as Director : 5th March 2010Date of last reappointment as Director : Not ApplicableExpertise in specific functional areas : IndustryQualification : B.Sc.Number of Equity Shares held in the Company by theDirector or for other persons on a beneficial basis : 78580List of outside Directorships held in Public Companies : NilChairman / Member of the Committees of Board ofDirectors of the Company : NilChairman / Member of the Committees of Board ofDirectors of other Companies in which she is a Director : Not ApplicableRelationship with other Directors : Wife of Sri N. Srinivasan, Vice Chairman & Managing

Director and Mother of Ms. Rupa Gurunath,Wholetime Director.

(vi) Name of the Director : Ms. Rupa GurunathDate of Birth : 15th February 1973Date of appointment on the Board as Director : 24th September 2007Date of last reappointment as Director : 28th August 2008Expertise in specific functional areas : IndustryQualification : B.Sc., Post Graduate Diploma in Computer ApplicationNumber of Equity Shares held in the Company by theDirector or for other persons on a beneficial basis : 36440List of outside Directorships held in Public Companies : 1. Coromandel Electric Company Limited

2. Coromandel Travels LimitedChairman / Member of the Committees of Board ofDirectors of the Company : NilChairman / Member of the Committees of Board ofDirectors of other Companies in which she is a Director : NilRelationship with other Directors : Daughter of Sri N. Srinivasan, Vice Chairman &

Managing Director & Mrs. Chitra Srinivasan, Director.

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EXPLANATORY STATEMENT ANNEXED TO THE NOTICE OF THE SIXTYFOURTH ANNUAL GENERALMEETING OF THE COMPANY IN RESPECT OF ITEMS NO. 7 to 11 OF NOTICE DATED 30TH APRIL 2010.

Item No.7:

Sri Arun Datta was a nominee Director appointed by IDBI Bank Limited, during 25th January 2006 to 14th October2009 on the board of the Company. He was co-opted as an additional Director on the Company's Board with effectfrom 28th October 2009. Under provisions of Article 103 of the Articles of Association of the Company read withSection 260 of the Companies Act, 1956, Sri Arun Datta will hold the office upto the date of sixtyfourth AnnualGeneral Meeting. Notice in writing under Section 257 of the Companies Act, 1956 has been received along withnecessary deposit from a member signifying his intention to propose the appointment of Sri Arun Datta as a Directorat the sixtyfourth Annual General Meeting. This ordinary resolution is submitted to the members for approval.

Interest of Directors:

Sri Arun Datta is interested in the resolution as it concerns his appointment. No other Director is directly or indirectlyconcerned or interested in this resolution.

Item No.8:

Mrs.Chitra Srinivasan was co-opted as an additional Director on the Company's Board with effect from 5th March2010. Under provisions of Article 103 of the Articles of Association of the Company read with Section 260 of theCompanies Act, 1956, Mrs.Chitra Srinivasan will hold the office upto the date of sixtyfourth Annual General Meeting.Notice in writing under Section 257 of the Companies Act, 1956 has been received along with necessary depositfrom a member signifying his intention to propose the appointment of Mrs.Chitra Srinivasan as a Director at thesixtyfourth Annual General Meeting. Mrs.Chitra Srinivasan represents the promoter group. This ordinary resolutionis submitted to the members for approval.

Interest of Directors:

Mrs.Chitra Srinivasan is interested in this resolution as it concerns her appointment. Sri N.Srinivasan, Vice Chairman& Managing Director and Ms.Rupa Gurunath, Wholetime Director, are interested in this resolution as Mrs.ChitraSrinivasan is related to them. No other Director is directly or indirectly concerned or interested in this resolution.

Item No.9:

Ms.Rupa Gurunath was appointed as a Director of the Company on 24th September, 2007.

The Board of Directors of the Company at its meeting held on 5th March 2010 has appointed Ms.Rupa Gurunath asa wholetime director for a period of 5 years with effect from 5th March, 2010.

The terms of appointment of Ms.Rupa Gurunath as a wholetime director were considered and recommended by theRemuneration Committee of the Board of Directors held on 5th March, 2010, as per details furnished in the resolutions.

The Board considers that the appointment of Ms.Rupa Gurunath as a wholetime director representing the promotergroup is in the interests of the Company.

Members' approval is sought by way of ordinary resolutions for appointing Ms.Rupa Gurunath as a wholetime directorfor a period of 5 years with effect from 5th March, 2010 and payment of remuneration including commission as setout in the resolutions.

Interest of Directors:

Ms.Rupa Gurunath is interested in this resolution as it concerns her appointment. Sri N.Srinivasan, Vice Chairman& Managing Director and Mrs.Chitra Srinivasan, Director are interested in this resolution as Ms.Rupa Gurunath isrelated to them. No other Director is directly or indirectly concerned or interested in this resolution.

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Item No.10:

The Company has availed financial assistance in the form of External Commercial Borrowing (ECB) facility of US$20 Million from Axis Bank Limited for the purpose of part funding capital expenditure. One of the terms and conditionsset out by Axis Bank Limited is that the financial assistance is required to be secured by a first mortgage and chargeon pari passu basis on all the movable (other than current assets) and immovable assets of the Company with aminimum assets cover of 1.25 times.

Section 293(1)(a) of the Companies Act, 1956, provides, inter alia, that the Board of Directors of a public companyshall not, without the consent of such public company in general meeting, sell, lease or otherwise dispose of thewhole or substantially the whole of the undertaking of the Company, or where the Company owns more than oneundertaking, of the whole or substantially the whole of any such undertaking. Since the mortgaging by the Companyof its immovable and movable properties as aforesaid may be regarded as disposal of the Company's properties/undertakings, it is necessary for the members to pass a resolution under Section 293(1)(a) of the Companies Act,1956, for creation of the said mortgage / charge. Hence the resolution.

Inspection of Documents:

Copies of letter no.AXISBHK/CR/09-10/172 dated June 25, 2009 and modification letter nos. AXISBHK/CR/09-10/337 dated October 12, 2009, AXISBHK/CR/09-10/405 dated October 27, 2009 and AXISBHK/CR/09-10/425A datedNovember 3, 2009 received from Axis Bank Limited and copy of ECB Loan Agreement dated 6th November 2009with Axis Bank Limited are available for inspection of the shareholders at the Registered Office/Corporate Office ofthe Company between 11.00 A.M. and 1.00 P.M. on any working day prior to the date of the meeting and will also beavailable for inspection at the meeting.

Interest of Directors:No Director of the Company is directly or indirectly concerned or interested in this resolution.

Item No.11:

The Company's Register of Members, Register of Debentureholders, Index of Members and Debentureholders andother records are kept at "Tarapore Towers", First Floor, 826, Anna Salai, Chennai 600002, pursuant to the specialresolution passed by the shareholders at their Annual General Meeting held on 1st September 1992.

With the functioning of the Corporate Office from February 2010 at 'Coromandel Towers, 93, Santhome High Road,Karpagam Avenue, R.A.Puram, Chennai 600028, it is proposed to keep the Register of Members, Register ofDebentureholders, Index of Members and Debentureholders and other records at the Corporate Office of the Company.Since placement of the aforesaid registers etc., at a place within the city other than the Registered Office of theCompany, can be done only by obtaining the approval of the shareholders by a Special Resolution, this SpecialResolution is submitted to the meeting for approval.

Interest of Directors:

No Director of the Company is directly or indirectly concerned or interested in this resolution.

(By order of the Board)for THE INDIA CEMENTS LIMITED

Place: Chennai G BALAKRISHNANDate : 30th April, 2010 President & Company Secretary

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TEN YEARS IN BRIEF - FINANCIAL INFORMATION

YEAR ENDED 31st MARCH

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Sales & Earnings

1. Sales and other Income Rs.Lakhs 145137 131325 103300 123688 140230 183669 262088 360561 395454 422169

2. Profit/(Loss) before tax Rs.Lakhs 5115 (757) (30723) (11273) 458 4998 49196 84464 64830 53132

3. Cash Generated (internally) Rs.Lakhs 13416 7994 (22582) (3122) 8335 12652 59459 96243 93097 72087

Assets

4. Fixed Assets (Net) Rs.Lakhs 149109 142562 134458 233387 220485 211497 293858 403937 471229 462151

5. Capital Investments Rs.Lakhs 7437 2461 405 1971 2212 4896 14870 91990 95426 29625

6. Current Assets Rs.Lakhs 37911 43572 28415 30796 38791 49803 73889 108735 83010 100726

7. Loans and Advances Rs.Lakhs 102704 97769 103167 100022 98054 101439 97862 106206 131343 186919

Capital & Reserves

8. Share Capital Rs.Lakhs 16348 16359 16359 16359 16359 21577 26037 28187 28243 30717

9. Reserves and Surplus* Rs.Lakhs 60251 42778 23795 12105 12132 57567 108319 224427 262559 318019

10. Shareholders’ Fund Rs.Lakhs 76599 59137 40154 28464 28491 79144 134356 252614 290802 348736

Net worth, EPS & Dividend

11. Net worth per equity share (Rs.) 53.88 41.18 27.38 18.88 18.90 40.18 51.60 89.62 102.96 113.53

12. Earnings per equity share (Rs.) 3.25 (0.06) (14.74) (7.13) 0.12 2.61 19.65 23.97 15.32 12.49

13. Equity Dividend Per Share (Rs.) 1.8 – – – – – 1 2 2 2

* Figures exclude revaluation reserve and deferred income and after adjustment of deferred revenue expenditure.

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DIRECTORS’ REPORTYour Directors have pleasure in presenting their Sixtyfourth Annual Report together with audited accounts for the year ended 31st March 2010.

Rs. in CroresFor the year ended 31st March

2010 2009FINANCIAL RESULTS

Profit before Interest & Depreciation 863.51 1043.20

Less: Interest & Other Charges 142.64 112.15

Less: Depreciation 233.12 203.32

Less: Forex Fluctuation Loss/(Gain) (43.57) 79.43

Add: Transfer from Share Premium 13.28 –

Less: Shares/Bond issue expenses 13.28 –

Profit before Tax 531.32 648.30

Fringe Benefit Tax – 4.78

Deferred Tax 13.66 29.89

Provision for Taxation (net) 163.32 181.45

Profit after Tax 354.34 432.18

Add: Balance brought forward from last year 823.41 527.32

Less: Dividend proposed on Equity Capital (including Dividend Distribution Tax) 71.64 66.09

Less: Transfer to General Reserve 70.00 70.00

Less: Transfer to Contingency Reserve 50.00 –

Balance carried in Profit & Loss A/c 986.11 823.41

DIVIDENDThe Board of Directors has recommended a dividend of Rs.2/- per equity share of Rs.10/- each on 30,71,72,765 equity shares of Rs.10/- eachoutstanding as on date. The Board has also recommended payment of such dividend reduced proportionately to the amount paid up on shares onwhich there are calls in arrears.

SHARE CAPITALThe paid up equity share capital of the Company has increased to Rs.307.18 crore as on 31st March, 2010 comprising of 30,71,75,657 equityshares of Rs.10/- each on issue of 1,49,750 equity shares at a price of Rs.50/- per share (including premium of Rs.40/- per share) during 2009-10on exercise of options in terms of India Cements Employees Stock Option Scheme, 2006 (ESOS, 2006) and consequent to issue of 2,45,94,000equity shares of Rs.10/- each at a price of Rs.120.20 per share (including premium of Rs.110.20 per share) by way of Qualified InstitutionalPlacement (QIP) made in March 2010.

EMPLOYEE STOCK OPTION SCHEMEDetails of options granted / exercised and other disclosures as required under Clause 12 of the Securities and Exchange Board of India (EmployeeStock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 are set out in the Annexure 'F' to this Report.Messrs. Brahmayya & Co., Statutory Auditors of the Company have certified that the aforesaid Scheme has been implemented in accordance withthe Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 and theresolutions passed by the members approving the Scheme.No options have been granted so far under India Cements Employees Stock Option Scheme, 2007.

12

DIRECTORS’ RESPONSIBILITY STATEMENTThe Directors make the following statement in terms of Section 217 (2AA) of the Companies Act, 1956 with respect to Directors' responsibility.

“We confirm1. That in the preparation of the accounts for the year ended 31st March, 2010, the applicable Accounting Standards have been followed.2. That such Accounting Policies have been selected and applied consistently and made judgements and estimates that are reasonable and

prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2010 and of the profit of the Company for theyear ended on that date.

3. That proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of theCompanies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

4. That the annual accounts for the year ended 31st March, 2010 have been prepared on a going concern basis."

MANAGEMENT DISCUSSION AND ANALYSIS

Pursuant to Clause 49 of the Listing Agreement, a Management Discussion and Analysis Report is given as addition to this report.

CORPORATE GOVERNANCE

Pursuant to Clause 49 of the listing agreement with Stock Exchanges, a report on Corporate Governance along with Auditors' Certificate of itscompliance is included as part of the Annual Report and is given in Annexure 'C' and Annexure 'D' respectively. Further, a declaration on Code ofConduct signed by the Managing Director in his capacity as the Chief Executive Officer of the Company is given as Annexure 'E'.

OPERATIONS

COMPANY PERFORMANCE

The performance of the company has been discussed in detail in the Management Discussion and Analysis section. The steps taken by thecompany to enhance the capacity yielded results in the form of increased production of clinker and cement during the year. The second line atMalkapur and the upgraded kiln-1 at Vishnupuram quickly stabilized during the year. The Parli Grinding Unit which was commissioned towardsthe end of the previous year also contributed for the overall improvement. The clinker production of the company was at 86.82 Lakh Ts (69.83Lakh Ts), cement production was at 104.94 Lakh Ts (91.11 Lakh Ts) while the cement sales was at 105 Lakh Ts (91.18 Lakh Ts). There was alsoa clinker sale of 4.63 Lakh Ts (0.02 Lakh Ts) during the year under review.

Sales and other income for the year ended 31st March 2010 was at Rs.4221.69 Crores as against Rs. 3954.53 Crores in the previous year,registering an increase of 6.8%. The cement prices which were firm during the first two quarters declined due to reasons mentioned elsewhere inthe report during the third quarter but has started recovering slowly from the month of February 2010 onwards. Cost push was felt in the form ofincrease in the price of raw materials, power and other operating expenses and consequently the operating profit was lower at Rs. 863.51 Croresagainst Rs.1043.20 Crores in the previous year. The interest charges were higher at Rs. 142.64 Crores against Rs.112.15 Crores in the previousyear while the depreciation charges amounted to Rs. 233.12 Crores against Rs.203.32 Crores due to higher capitalization. Consequently the netprofit before tax was lower at Rs. 487.75 Crores against Rs.727.64 Crores in the previous year.

The foreign exchange translation difference as per AS 11 has resulted in an exceptional income of Rs. 43.57 Crores against an expense ofRs.79.43 Crores in the previous year. The provision for current tax liability works out to Rs. 163.32 Crores (Rs.181.45 Crores). The deferred taxprovision as per AS 22 resulted in a liability of Rs. 13.66 Crores (Rs.29.89 Crores) while there was no Fringe Benefit Tax during the year (Rs.4.78Crores). Consequently the profit after tax was Rs. 354.34 Crores against Rs.432.18 Crores in the previous year.

The year under review witnessed substantial increase in cost of production on account of various factors which include the following:-

a) Increase in wages to workmen due to increase in cost of living index by 329 points which along with increase in the salaries of managementstaff in line with the industry together with the provision for unavailed leave as per AS 15 accounted for additional outgo of Rs.51 Crores.

b) Revision in the minimum wages payable for the contract workmen.

c) Increase in royalty on limestone from Rs.45/Tn to Rs.63/Tn with effect from August '09.d) Increase in the price of petroleum products namely Diesel.e) Increase in power generation and purchase of power from alternate sources due to power cut and restriction of power resulting in higher

overall cost of power.f) Increase in Excise Duty on cement to 10% from 8%.

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All this together with the residual impact of such increases in the previous year substantially impacted the cost, which was partially offset throughincreased blended cement tonnage and through contribution from higher volume of production.

SUBSIDIARIES

INDO ZINC LIMITED (IZL)ICL Financial Services Limited (ICLFSL), the Company's wholly owned subsidiary, acquired 12.97% of equity shares in IZL and entered into anagreement with the promoters for purchase of another 39.73% of equity share capital. Since IZL was a listed Company, an open offer was madeto non-promoter shareholders of IZL for acquiring their holdings in IZL subject to a maximum of 20% under SEBI (Substantial Acquisition of Sharesand Takeovers) Regulations, 1997 (Takeover Code). All the formalities under the Takeover Code have been completed and ICLFSL presentlyholds 60.89% of equity share capital of IZL (including 8.19% acquired under open offer) and IZL became a subsidiary of ICLFSL, thereby becomingthe stepdown subsidiary of your Company.IZL is presently implementing a project involving construction of an 1.5 million tonne cement plant in Rajasthan. The project is expected to becommissioned in July 2010.

PT. COROMANDEL MINERALS RESOURCESThe company has set up this subsidiary in Indonesia for acquiring coal concessions. Pending acquisition of coal mines, the company is yet tocommence operations. However, the company is in discussion with various concession owners for acquiring coal mines.The Company has been exempted by the Central Government vide its letter No. 47/236/2010-CL-III dated 21.4.2010 under Section 212 (8) of theCompanies Act, 1956, from attaching a copy of the Balance Sheet, Profit and Loss Account, Report of the Board of Directors and the Report of theAuditors of the Subsidiary Companies namely Industrial Chemicals & Monomers Limited, ICL Financial Services Limited, ICL Securities Limited,ICL International Limited, Trishul Concrete Products Limited, Indo Zinc Limited and PT. Coromandel Minerals Resources, Indonesia. However,pursuant to Accounting Standard 21 issued by the Institute of Chartered Accountants of India, Consolidated Financial Statements presented by theCompany include the financial information of the subsidiaries. The Company will make available these documents/details upon request by anymember of the Company and its subsidiaries interested in obtaining the same. The annual accounts of the Subsidiary Companies will also be keptfor inspection by any member at the Registered/Corporate Offices of the Company and its Subsidiary Companies.

CONSOLIDATED FINANCIAL STATEMENTSAs prescribed by Accounting Standard 21 issued by the Institute of Chartered Accountants of India, the audited consolidated financial statementsof India Cements Group are annexed.

ASSOCIATE COMPANIES

COROMANDEL SUGARS LIMITEDDuring the year ended March 31, 2010, Coromandel Sugars Ltd has achieved the highest Profit before tax of Rs.26.92 crores (unaudited), sincecommissioning of the plant. Despite the lower crushing of 5.28 lakh tonnes of sugarcane during the year as against 5.63 lakh tonnes in the earlier year,this was possible, primarily because of significant increase in the market price for sugar and molasses and also due to higher sugar recovery of10.17% achieved as against 9% in the earlier year.The company has produced 53634 tonnes of sugar (50677 tonnes) and molasses of 23653 tonnes ( 29824 tonnes). Power exported to grid wasmarginally lower at 200 lakh kwh as against 212 lakh kwh in the previous year, due to lower crushing. Sugar Sales volume fell by over 12%, i.e., from60167 tonnes in the previous year to 52723 tonnes in the current year, while molasses sales volume dropped by over 32%, i.e., from 30568 tonnesin the previous year to 20766 tonnes during the year under review. Despite lower sales volume of Sugar and Molasses, total gross revenue of thecompany increased by 25% to an all time high of Rs. 153.17 cr ( Rs.122.17 cr). It may be noted that due to shortage of sugar cane, there was stiffcompetition among mills resulting in higher Cane price of Rs.1950 per tonne (Rs.1250/tonne). Based on unaudited financials, the Earnings beforeInterest and Depreciation was higher at Rs. 38.38 cr (Rs. 15.98 cr). Profit Before Tax for the year was Rs.26.92 cr. (Rs.2.85 cr.).

INDIA CEMENTS CAPITAL LIMITED (ICCL)The main focus of the Company continues to be on various fee-based activities such as, Full Fledged Money Changing [FFMC], Travel & Toursand Forex Advisory Services. The wholly owned subsidiary viz. India Cements Investment Services Limited (ICISL) is in Stock Broking.The FFMC division operates out of 29 branches and Travels division operates at Chennai as an IATA accredited branch. The subsidiary ICISL has25 branches. The Gross income from operations of ICCL was Rs.990.66 lakhs and that of ICISL was Rs.245.37 lakhs for the year ended31st March, 2010.

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COROMANDEL ELECTRIC COMPANY LIMITED (CECL)

Due to higher gas availability during the last quarter of the year, the company was able to generate 170 million units of power as compared to 163.6million units in the corresponding period of previous year, which was wheeled and used at the cement plants of your company in Tamil Nadu. The totalrevenue earned by the company during the year was Rs.44.78 Crores (Provisional) (45.33 Crores) and net profit after tax was Rs.8.44 Crores(Provisional) (Rs.6.66 Crores). The company maintained its dividend pattern of 9% on equity shares besides declaring dividend at the respectivecoupon rates for the participating / non-participating preference share capital.

EXPANSION / MODERNISATIONMost of the ongoing expansion programmes have been completed towards the end of the previous financial year. The upgraded capacity of thekiln-1 at Vishnupuram commissioned in March 2009 stabilised quickly and has been operating to its enhanced production levels. The expansionof Kiln-2 at Malkapur after initial trial runs has also stabilized earlier than expected and has been running to capacity. The Parli Grinding Unit hasstarted producing cement from the month of May '09 and had to face initial bottlenecks in the form of evacuation problems being a new location.The problem has since been overcome and the plant has started grinding to its full levels. The upgradation of the capacity at Chilamakur to 4500TPD has been delayed by nearly 6 months and is expected to be completed by the first quarter of FY 2011.

PUBLIC DEPOSITS

The total amount of fixed deposits including cumulative deposits, which had not become due but outstanding as at 31st March, 2010 stood at Rs.1,285.85Lakhs. Deposits totalling Rs.41.11 Lakhs that matured for repayment were neither claimed by the Depositors nor instructions for renewal were received bythe Company. Reminders were issued to the deposit holders and since the close of the financial year ended 31st March, 2010, deposits aggregating toRs.11.36 Lakhs out of the above have either been claimed and paid or have been renewed or transferred to Investor Education and Protection Fund.

CONSERVATION OF ENERGY ETC.

The prescribed details as required under Section 217(1)(e) of the Companies Act, 1956 are set out in the Annexure 'A'.

RESEARCH & DEVELOPMENT

During the year, your Company spent Rs.51.81 Lakhs towards revenue expenditure of the R&D department besides contributing a sum of Rs.78.72Lakhs to National Council for Cement and Building Materials (NCCBM), which carries out research on behalf of the industry.

PERSONNEL

Industrial relations continued to remain cordial during the year.

In terms of the provisions of Section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules, 1975, asamended, the names and other particulars of the employees are to be annexed to the Directors' Report. However, as per the provisions of Section219 (1)(b)(iv) of the said Act, the Annual Report excluding the aforesaid information is being sent to all members of the Company and othersentitled thereto.

DIRECTORS

Mr.N.Ramachandran resigned as Executive Director and Director with effect from 12th August, 2009. The directors record their appreciation of thevaluable contribution made by Mr.N.Ramachandran during his tenure as non-executive director and later as Executive Director of the Company.

IDBI Bank Limited appointed Mr.K.P.Nair on the Board of the Company with effect from 14.10.2009 in the casual vacancy caused by withdrawalof nomination of Mr.Arun Datta.

Mr.Arun Datta and Mrs.Chitra Srinivasan were appointed by the Board as additional directors of the Company with effect from 28.10.2009 and05.03.2010 respectively. Under Article 103 of the Articles of Association of the Company, Mr.Arun Datta and Mrs.Chitra Srinivasan will hold theiroffices upto the date of the ensuing Annual General Meeting and resolutions for their election as directors of the Company are included in theNotice dated 30th April, 2010 convening the 64th Annual General Meeting of the Company.

Ms.Rupa Gurunath was appointed as a wholetime director effective from 5th March, 2010 for a period of 5 years on terms recommended by theRemuneration Committee of the Board. A resolution for the approval of her appointment as a wholetime director is included in the Notice dated30th April, 2010 convening the 64th Annual General Meeting of the Company.

Under Article 109 of the Articles of Association of the Company, Mr.V.Manickam, Mr.A.Sankarakrishnan and Mr.N.R.Krishnan retire by rotation atthe ensuing Annual General Meeting of the Company and are eligible for re-appointment.

15

Information on Directors eligible for appointment / reappointment in terms of Clause 49 of Listing Agreement is annexed to the Notice dated30th April, 2010 convening the 64th Annual General Meeting.

AUDITORSMessrs. Brahmayya & Co and P.S.Subramania Iyer & Co., Chennai, the Auditors of the Company, retire at the ensuing Annual General meetingand are eligible for reappointment.Sam Services of Mr.S.A.Muraliprasad, Cost Accountant, Chennai has been appointed as Cost Auditor for the year 2010-11 subject to approval bythe Government of India.

CORPORATE SOCIAL RESPONSIBILITYYour Company is one of the few Companies in the country which have taken a number of initiatives for community development right frominception.It spends approximately a sum of Rs.375 lakhs annually for imparting education at its colleges and schools. The following deserve specialmention.A Balavidyalaya was started in Sankarnagar, Tirunelveli District as early as in 1952. Sankar Higher Secondary School was started in Sankarnagarin 1957. The school has today 1900 students.A Polytechnic College was started in Sankarnagar in 1958. The College has evolved into one of the best polytechnics in the country andcelebrated its Golden Jubilee in 2008.The other plants of the Company namely Sankaridurg and Dalavoi in Tamil Nadu and Chilamakur, Vishnupuram and Malkapur in Andhra Pradeshalso have matriculation and higher secondary schools imparting education in all to about 2669 students.A College by name T.S.Narayanaswami College of Arts and Science was started in 1996 at Navalur near Chennai. It is a postgraduate Collegeoffering affordable education to about 950 students - mostly from the lower strata of society.Besides assisting schools run by the Company, India Cements has been helping other educational institutions also. Nearly 50 such schools havebenefited in the recent past by having their infrastructure strengthened.Besides education, India Cements has been donating liberally for the construction and renovation of temples, mosques and churches. Thedonation made by the Company for these and other purposes during the last 5 years is Rs.90 lakhs per annum on an average.The Company contributed liberally to alleviate the sufferings of people affected by earthquake in Gujarat, floods in Andhra Pradesh and tsunamiin Tamil Nadu in the recent past.In the matter of healthcare, India Cements is second to none in taking proactive steps for supporting primary health centres. Conducting of medicalcamps has been another major area and at least 7500 people have been covered by health camps.The importance your Company attaches to Corporate Social Responsibility (CSR) can be gleaned from the fact that an exclusive departmentconsisting of 6 executives has been established at the Corporate Office and a CSR policy was officially adopted on 1st April, 2009. The policy isbased on the globally accepted Triple Bottom Approach, which is an initiative to create new value to Economic, Environmental and Social issues.The policy specifies 6 sectors namely socio-economic and cultural, infrastructure, health, human development and capacity building for self-employment, environment, sports and recreation.

In the year 2009-10, in the aforesaid 6 sectors, the cement plants of the Company have carried out nearly 40 different specific activities like healthcamps, veterinary camps, provision of drinking water and other infrastructure to the Government schools in the nearby villages, repairing andprovision of infrastructure facilities at the villages etc. The empowerment of the communities in and around our plants is of special significance.Support to self-employment activities at Dalavoi and two lift irrigation projects in Vishnupuram and a check dam near Yerraguntla plant are someexamples.In the matter of environment, the wind mills setup by the Company in Coimbatore and Tirunelveli Districts, waste heat recovery plant in Vishnupuramand the use of fly ash need special mention.

CHENNAI SUPER KINGSAs the shareholders are aware, your company has bought the Chennai cricket franchise of the Indian Premier League in 2008. The cricket teamof the Chennai franchise styled "Chennai Super Kings" has garnered very quickly an eminent brand value and various analysts have valued theChennai franchise in multiples of the original investment. The company besides having built up this excellent brand has also fostered a successfulcricket team with the most consistent record among all teams over the last 3 years. This well knit unit has cornered the glory of being champions

16

of the just concluded Indian Premier League in April 2010. The Company’s investment in the cricket franchise has not only served to enhanceshareholder value, built up a strong brand which can be used to market the company's products in future but also has promoted cricket and a largefan following all over the world.

NEW CORPORATE OFFICE BUILDINGYour 64 year old company has been helping people move into their own homes. Your directors thought it was time your company also moved intoits own premises. Its long cherished dream has been realized in February 2010 with the company moving its corporate office to its own building at"Coromandel Towers", 93, Santhome High Road, Karpagam Avenue, R.A. Puram, Chennai 600 028.

ACKNOWLEDGEMENTThe Directors are thankful to the Financial Institutions and the Bankers for their continued support. The Directors also thank the Central Governmentand the various State Governments for their support. The stockists continued their excellent performance during the year and the Directors areappreciative of this. The continued dedication and sense of commitment shown by the employees at all levels during the year deserve special mention.

On behalf of the Board

N.Srinivasan Rupa GurunathVice Chairman & Managing Director Wholetime Director

B.S.Adityan Arun DattaR.K.Das N.R.KrishnanV.Manickam A.SankarakrishnanN.Srinivasan K.Subramanian

Place : Chennai 600 028Date : 30th April, 2010 Directors

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ANNEXURE ‘A’ TO DIRECTORS’ REPORT FOR THE YEAR ENDED 31st

MARCH, 2010Information pursuant to Section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of particulars in the report of Board ofDirectors) Rules, 1988.A. Conservation of Energy:

(a) Energy conservation measures undertaken:i. Optimisation of the pressure drop in the pre-heater down comer duct through Computerised Fluid Dynamics modification.ii. Installation of high efficiency HT drive for cement mill and VFD for mill vent fan operations resulted in lower power consumption.iii. Additional power capacitors wherever required installed to improve the power factor.iv. High efficiency electronic packers with truck loaders installed in place of conventional mechanical packers resulting in higher output and

lower power consumption.v. Optimisation of air distribution in the cooler section resulting in power reduction.vi. Reciprocating compressors in the cement mill and packing house replaced with modern efficient screw compressors.vii. Line II at Malkapur with most modern high efficiency motors, air slides in place of screw conveyors, high efficiency process fans and with

latest automation technology for better monitoring and improvement of productivity.viii. Incandescent conventional bulbs replaced with energy saving CFL /FL bulbs for reducing the colony electricity consumption.ix. Retrofitting of old MOCBs with VCBs.x. Upgradation of cooler II drive and kiln drive and replacement of kiln girth gear in one of the plants resulting in improved kiln operation and

reduction in specific heat and power consumption.xi. Installation of fly-ash silo and feeding system resulting in increased additives consumption and reduction in specific power consumption in

PPC.(b) Additional investments and proposals, if any, being implemented for reduction of Consumption of energy:

i. Installation of high efficiency and low pressure preheater cyclones.ii. Optimisation of mill outputs through closed circuiting of raw mill and cement mills.iii. Close circuiting of tertiary crusher to improve the output of raw mill.iv. Cooler mid air tapping for increasing the hot air temperature and improving the VRM output which will result in reduction of hot air from

preheater saving the fuel.v. Installation of fly-ash silos and proper feeding systems at two of the plants further to optimize the usage of fly-ash and reduce the power

consumption.vi. Upgradation of pyro section for 4500 TPD output (3600 TPD) ensuring heat and power reduction.vii. Installation of fly-ash driers ensuring optimum utilization of hot gas and higher availability of fly-ash to reduce the overall power consumption.viii. Modern wagon loading arrangements planned for increasing the packing output and reduction in power / labour including installation /

retrofitting of electronic packers in place of mechanical packers.ix. Mechanical conveyor for cement transport to reduce the power consumption.x. Optimisation of mill output through introduction of PLC and DCS for one of the plants.

(c) Impact of measures at (a) and (b) above for reduction of energy consumption and consequent impact on cost of production of goods:The measures that are proposed to be taken/under implementation are expected to reduce the power consumption by nearly 4 units/Tn ofcement and overall heat consumption by around 10-15 k.cals per kg of clinker. However, during the year , the power was higher on account ofstabilization of the new line at Malkapur and the expanded line at Vishnupuram which has been explained elsewhere in the report.

(d) Total energy consumption and energy consumption per unit of production:Given in Form'A' annexed.

B. Technology Absorption: Efforts made in technology absorption: Particulars given in Form 'B' annexed.C. Foreign exchange earnings and outgo:

(a) Activities relating to exports, initiatives taken to increase exports, development of new export market for products and services and export plans:We have not exported cement/clinker during 2009-10.

(b) Total foreign exchange used and earned:Current Year Previous Year

Used Rs. lakhs – –Earned Rs. lakhs 1.68 –

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FORM A

FORM FOR DISCLOSURE OF PARTICULARS WITH RESPECT TO CONSERVATION OF ENERGY

Current PreviousYear Year

A. POWER & FUEL CONSUMPTION

1. Electricity

(a) Purchased

Units - KWH - Lakhs 8797.25 7262.40

Total amount - Rs. Lakhs 27214.84 21887.85

Rate per unit - Rs. 3.09 3.01

(b) Own Generation

(1) Through Diesel/Furnace Oil Genset *

Units - KWH - Lakhs 1444.98 1039.05

Unit per Litre of Diesel/Furnace Oil-KWH 3.88 3.82

Cost per unit - Rs. 4.71 3.80

(2) Through Steam Turbine/Genset

Units - KWH - Lakhs – –

Unit per Litre of Furnace Oil/Gas-KWH

Cost per unit - Rs.

2. Coal for Kilns (various grades incl. Lignite)

Quantity Tonnes 1419277 1177630

Total Cost Rs.Lakhs 65697 63113

Average Rate Rs./Tonne 4629 5359

3. HSD/Furnace Oil for KilnsQuantity K.Litres 677.35 509.70

Total Cost Rs.Lakhs 227.68 173.70

Average Rate Rs./K.Litre 33613 34079

4. Consumption per unit of Production Standards

(if any)

Electricity (KWH/Tn of Cement) 110 93.16 91.13

Coal Consumption Per Tn of Clinker 20-25 16.35 16.87

(Depending on Quality of Coal)

Diesel Oil/Furnace Oil per tn of Cement (Litres) 0.06 0.05

* Including Power from Waste Heat Recovery Plant.

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Research and Development (R & D):

1. Specific areas in which R&D carried out by the Company

2. Benefits derived as a result of above R & D

3. Future plan of action

4. Expenditure on R & D:

(a) Capital

(b) Recurring

(c) Total

(d) Total R&D expenditure as a percentage of total turnover

Technology absorption, adaptation and innovation:

1. Efforts, in brief, made towards technology absorption, adaptation andinnovation.

2. Benefits derived as a result of above efforts e.g. product improvement, costreduction, product development, import substitution etc.

3. In case of imported technology (imported during the last 5 years reckonedfrom the beginning of the financial year), following information may befurnished:(a) Technology imported(b) Year of Import(c) Has technology been fully absorbed(d) If not fully absorbed, areas where this has not taken place, reasons

therefor and future plans of action.

The Company has started an inhouse R&D departmentduring Dec.99 with a specified objective of carrying ofR&D Projects in development of expert systems for themills and kilns optimisation, Benchmark studies of ourCement Plants, optimisation of process Systems andParameters ensuring Product improvement and costreduction.

Nil

A sum of Rs.51.81 lakhs has been spent during the yearfor the functioning of R&D department. Besides this, asum of Rs.78.72 lakhs is the contribution to NationalCouncil for Cement and Building Materials (NCCBM)which carries out Research on behalf of the Industry.

Rs.130.53 Lakhs

0.03

Not applicable

FORM B

FORM FOR DISCLOSURE OF PARTICULARS WITH RESPECT TO ABSORPTION

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MANAGEMENT DISCUSSION AND ANALYSIS

ECONOMY – AN OVERVIEW

India's economy expanded at the rate of 7.9% in the July-September 2009 period bolstered by Government injectedstimulus packages and rising industrial production.

A sustained revival in production of capital goods and consumer durables has fuelled a 15.1% growth in official Indexof Industrial Production (IIP) in February 2010, which marks the fourth consecutive month of double digit industrialgrowth with the cumulative growth for 11 month period (April-February 2009-10) working out to 10.1% as against 3%in the corresponding period of 2008-09.

The country's exports in February 2010 touched $16.09 billion registering a 34.7% increase over $11.94 billionrecorded in February last year. Imports surged a whopping 66.4% at $25.06 billion in February 2010 compared to$15.08 billion in the same month last year. Cumulative imports during April 2009 / February 2010 declined to $248billion compared to $287 billion in the corresponding period of the earlier financial year.

Inflation rate as measured by wholesale price index touched a 16 month high of 9.89% in February 2010 as comparedto 8.56% in January 2010.

INDUSTRY SCENARIO

Despite the widely published impact of global melt down elsewhere in the world, the growth of cement industry inIndia was upbeat registering double digit growth during the year under review defying the prediction of troubled timesfor the industry. Based on the available information furnished by Cement Manufacturers' Association, the all Indiaclinker production was up by a healthy 13.4% while cement production was up by 12.4% with the industry operatingat close to 85% of its capacity. The domestic consumption of cement in the country grew significantly by 12.8% forthe year ended 31st March 2010. However, the growth in the south was sluggish due to a negative growth in AndhraPradesh and it was only at 5.1% for the year under review as compared to a double digit growth in the previous year.The core markets of Tamil Nadu, Kerala and Karnataka registered a growth of 11.1%, 4.4% and 6.6% respectivelyfor the period. With materialization of more capacities in the South and with a negative growth in Andhra Pradesh,the cement prices were depressed from the month of October '09 but has started recovering from February 2010.With growth in demand absorbing the additional capacities created, it is expected that prices would further recover topre-October '09 levels in the busy season ahead. Though South witnessed substantial increase in capacity whichhas started materializing from the second half of the year, the natural flow to the deficit markets of East and Northhave already started taking place and which acts as a buffer in helping stabilization of prices in the South. Duringthe year under review the international prices of oil were fluctuating frequently moving from a level of US$ 40 inMarch '09 to US$ 82 by March 2010. This upward movement of oil prices had its impact on the coal prices which alsowent up from a level of around US$ 85 CIF per Tn in the first quarter of the year to a level of US$ 115 CIF per Tnduring March 2010. The strengthening of the Rupee against Dollar from a level of Rs.51 in the year beginning toaround Rs.45 towards the end of the year gave some cushioning effect to the increase in the price of coal. Theindustry was also burdened with increase in the price of diesel and petroleum products which impacted the freightrates of incoming materials and outgoing finished product. The Royalty on limestone was also revised steeply fromRs.45/Tn to Rs.63/Tn from the month of August '09. The Excise Duty on cement was also hiked by 2% from 8 to 10%in the Union Budget from 1st March 2010.

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COMPANY PERFORMANCE

With the steps taken to enhance the capacities, the performance of the company was significantly up as given hereunder:-

In Lakh Tns

2009-10 2008-09 % Growth

Clinker 86.82 69.83 24

Cement 104.94 91.11 15

Cement Sales 105.00 91.18 15

Clinker Sales 4.63 0.02

Overall sales including Clinker 109.63 91.20 20

It can be seen from the above that the company has achieved significant strides in clinker, cement and dispatchesduring the year under review. The performance of the company could have been better but for the constraints in theavailability of power from the grid in Tamil Nadu and Andhra Pradesh during early part of the year and the evacuationproblems in the newly created facility at Parli and the enhanced facility at Malkapur. While there was a minimumpower cut to the tune of 20% throughout the year in Tamil Nadu, there were significant disruptions in the poweravailability during the first quarter of the year in Andhra Pradesh imposing power holidays for 2 days in a weekbesides peak hour restrictions. The company could overcome the problem by running the costly captive heavy oilgenerating sets and by availing power from the collective captive power plants and through sourcing of high costpower from alternate sources.

Also, there was delay in the commissioning of the cement grinding facilities at the Malkapur Plant and at ParliGrinding Unit and more time was taken for stabilization of these facilities. The Company had therefore resorted tothe sale of 4.63 Lakh Ts of clinker particularly during the first half of the year under review.

Some of the company's plants achieved record levels of production as under:-

• The new dry process cement plant at Sankaridrug achieved record clinker production of 4.37 Lakh Ts.

• Dalavoi Plant achieved its highest cement grinding and dispatch of 16.64 Lakh Ts and 16.62 Lakh Ts respectively.

• Yerraguntla Plant surpassed its previous record in clinker production at 5.62 Lakh Ts (5.39 Lakh Ts).

The upgraded facility at Vishnupuram and the second line at Malkapur have also started producing up to their revisedenhanced capacities.

During the year under review, the company's ships were gainfully employed with one of the ships on captive cargodoing 11 voyages and the other one fixed on the coastal coal movement at reasonably good rates. The sale andpurchase prices having bottomed out, the shipping sector is now looking up with an opportunity for further investmentin business to capitalize on the rise in ocean freight rates.

ENERGY EFFICIENCY AND COST REDUCTION

While the company has taken lot of proactive steps in minimizing the cost of power through addition of wind mills andstakes in gas power plants in Andhra Pradesh and Tamil Nadu and through Waste Heat Recovery System, the

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restrictions in the overall availability of power and resultant dependence on heavy oil fuel sets and purchase of alternatesource of power at higher cost resulted in marginal increase in the overall cost of power. While sustained efforts yieldedresults in the form of reduced power consumption in four of our plants, increased power consumption at two other plantswhere expansions/upgradations were carried out could not be avoided given the initial teething problems and stabilizationperiod for the new / upgraded facilities. Towards the end of the year the power consumption has started coming downat these units also and is expected to stabilize at normal levels.

The company's wind mills generated a total of 359 Lakh units (282 Lakh units) which was used by the company's plantsin Tamil Nadu. The Waste Heat Recovery System at Vishnupuram generated 561 Lakh units (472 Lakh units) duringthe year under review. The company has also availed 1638 Lakh units of power from Coromandel Electric Company Ltd(1595 Lakh units) and 1882 Lakh units from Andhra Pradesh Gas Power Corporation Ltd (1330 Lakh units) chargeableat cheaper prices which helped in mitigating the impact of increase in average cost of power.

The blended cement proportion was also maintained in consonance with the increase in the production volume and wasat 75.10 Lakh Ts as compared to 64.85 Lakh Ts in the previous year which also helped in mitigating the impact of costincreases.

DEVELOPMENT ACTIVITIES

Your company has already obtained ISO 9001 certification for quality assurance for the plants at Sankarnagar, Chilamakurand Vishnupuram and implementation of the same is already in progress for other plants and expected to be completedby financial year end.

Your company has implemented Total Productive Maintenance (TPM) for productivity improvement in your plants atSankarnagar, Dalavoi, Chilamakur and Yerraguntla. The implementation of TPM for productivity enhancement is inprogress for the Vishnupuram and Malkapur plants.

CLEAN DEVELOPMENT MECHANISM (CDM)

Your company has been earning its Certified Emission Reductions in its approved CDM project of the Waste HeatRecovery at Vishnupuram plant and further avenues involving reduction of carbon emissions through usage ofalternate fuels are also being explored.

OPPORTUNITIES, THREATS, RISKS AND CONCERNS

The growth of the industry has been upbeat with a capacity utilization of 85%. Though the economy showed signs ofslow down in the early part of the year, it posted a remarkable recovery, thanks to the inherent strength of the economyand revival of the infrastructure industry and improvement in industrial production. With the outlook of a 10% growth ratein the 12th plan period and with more investments in the infrastructure sector, the industry can expect buoyancy tocontinue in the medium term. However, significant portion of the balance of capacities announced earlier are on theanvil and which is likely to have an impact on the cement prices in the short term. But with the anticipated boost to theinfrastructural developments such as roads, ports and mega power plants and with the revival of the global economy asbeing witnessed, the demand supply imbalance for the country as a whole could get corrected within a short span oftime, which augurs well for the industry. However, the demand supply imbalance in the South where huge capacitiesare materializing may take a longer time to correct. The challenge to the industry will be to overcome the transportbottlenecks that may come in the way of reaching these capacities to deficit markets.

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Your company is also well placed with the enhanced capacities which are functional and will participate in the overallgrowth in the cement sector. Indo Zinc Limited, a stepdown subsidiary of your company, is setting up a new 1.5 milliontonnes green field cement plant in Rajasthan, which is expected to be operational from July 2010. The upgradation at theChilamakur Cement Plant to 4500 TPD of clinker is slightly delayed and will start materializing from the second quarter ofFY 2011.

To overcome the bottlenecks in the availability of power posed through restrictions from grid supply, the company isputting up two thermal plants of 50 MW capacity each in Tamil Nadu and Andhra Pradesh. The company has alsocompleted the formalities for obtaining the coal mining rights in Indonesia to meet the requirements of coal for powergeneration and to meet in part the requirements of coal for cement manufacture. The company has also taken stepsto secure long term agreement for supply of additional fly ash to maximize blended cement production.

Impending increase in the price of petroleum products could affect the energy and transportation cost of the company.The company's ships are available at hand to partially protect against the increase in ocean freight rates for inwardcarriage of coal and other materials. The volatility of the Rupee against Dollar could significantly impact the pricesof imported coal / spares and thereby the cost of production. The infrastructural bottlenecks in the form of shortagesin availability of indigenous coal and wagon supplies for movement of cement are also causes of concern. Withadditional allocation of indigenous coal and with the mining rights in Indonesia for imported coal, this risk has beenmitigated to a certain extent.

OUTLOOK

Based on the announcements and projections of the Planning Commission and ADB, the Indian economy is betterplaced to grow at over 8% in the medium term despite the relatively nil growth or recessionary trends elsewhere.The economy is driven by self-consumption and growth in fundamental sectors of industry, agriculture and services.Even during the difficult times in the previous year, the industry was not affected by the economic slow down and itregistered a growth of over 8% in 2008-09 and over 12% in FY 2010. Since economic growth is driven more bydevelopment of infrastructure and housing, it has a direct link to the cement consumption which has grown at morethan 100% of the growth in GDP. With this sustained growth in cement consumption and with part of the newcapacities having already been absorbed in the market place, the industry is poised to register significant strides withimproved returns despite marginal aberrations in prices during commissioning of new capacities in 2010-11.

VALUE ENHANCING STRATEGIES

The company has taken lot of steps in increasing the capacity through upgrades and installation of green field plantsand has been constantly looking for opportunities for further growth in capacity thereby enhancing the value of thestakeholders. This has resulted in improvement in production by over 20% as detailed elsewhere during the yearunder review.

On the cost front, the company has taken steps for increasing the sources of fly ash in order to maintain the blendedcement proportion which was over 73% during the year under review. The company is also taking steps to bringdown the cost of fuel through securing additional coal linkages in the domestic front and mining rights for importedcoal besides inducting the Company’s own ships for transport of coal to combat the freight costs. Steps are alsotaken to ensure power availability through installation of power plants. The company has also trimmed its manpoweracross all the units already.

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HUMAN RESOURCES & INDUSTRIAL RELATIONS

The industrial relations remained cordial throughout the year at all the units. Training and multi-task development skillsare given prime importance. With sustained efforts taken for reduction of manpower, the overall number of employeesat the end of the year under review was 3262 (Previous Year - 3323).

INTERNAL CONTROL SYSTEMS & THEIR ADEQUACY

Your company has a well defined internal control system to support efficient business operations and statutory compliance.A team of external Firms of Chartered Accountants appointed to carry out the internal audit function adds to the stabilityof the internal control systems. Suitable internal checks have been built-in to cover all monetary transactions withproper delineation of authority, which provides for checks and balances at every stage. The company has a strongsystem of budgetary control which covers all aspects of operations, finance, capital expenditure at a macro level on amonthly basis reporting directly to top management. All the physical performances and efficiency parameters aremonitored on a daily basis and actions are taken then and there. The company has an Audit Committee of Directors toreview financial statements to shareholders. The role and terms of reference of the Audit Committee cover the areasmentioned under Clause 49 of the Listing Agreement with Stock Exchanges and Sec.292A of the Companies Act, 1956besides other terms as may be referred to by the Board of Directors from time to time.

FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE

HIGHLIGHTS OF FINANCIAL PERFORMANCERs.Crores

2009-10 2008-09

Net Sales/Income from operations 3687.27 3359.49

Other Income 120.99 115.41

Total Income 3808.26 3474.90

Total Expenditure 2944.75 2431.70

Operating Profit 863.51 1043.20

Operating Margin % 22.67% 30.02%

Interest & Finance Charges 142.64 112.15

Gross Profit after Interest but before Depreciation and Tax 720.87 931.05

Depreciation 233.12 203.32

Profit for the year 487.75 727.73

Foreign Exchange Fluctuation 43.57 (79.43)

Profit before Tax 531.32 648.30

Fringe Benefit Tax – 4.78

Deferred Tax Liability 13.66 29.89

Taxation provision - net 163.32 181.45

Profit after Tax 354.34 432.18

Return On Capital Employed (ROCE)* 16.52% 24.33%

* ROCE = Operating Profit/Capital Employed (excluding capital work in progress and revaluation)

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Sales and other income from operations has gone up by 9.8% mainly due to increase in the volume of sales by over20% as offset by the reduction in selling prices. The other income was higher due to higher income derived from theFranchisee income of the Chennai Super Kings. The total expenditure has gone up by 21% driven by the increasein volume as well as the cost push mentioned elsewhere in the report and also due to higher provisioning required asper AS 15 of ICAI for unavailed leave.

Interest and other charges were higher at Rs.142.64 Crores as compared to Rs.112.15 Crores due to drawal ofadditional loans for operations and capital expenditure, while Depreciation charges were higher at Rs.233.12 Croresagainst Rs.203.32 Crores due to higher capitalization including the grinding facilities at Malkapur.

The deferred taxation as per AS 22 has resulted in a liability of Rs.13.66 Crores (Rs.29.89 Crores) while the provisionfor tax works out to Rs.163.32 Crores (Rs.181.45 Crores). There was no Fringe Benefit Tax during the year(Rs.4.78 Crores). The resultant net profit after tax was lower at Rs.354.34 Crores as compared to Rs.432.18 Croresin the previous year.

CAUTIONARY STATEMENT

Statements in the Management Discussion and Analysis Report describing the Company's objectives, expectationsor predictions may be forward looking within the meaning of applicable securities laws and regulations. Actualresults may differ materially from those expressed in the statement. Important factors that could influence theCompany's operations include global and domestic supply and demand conditions affecting selling prices of finishedgoods, input availability and prices, changes in government regulations, tax laws, economic developments within thecountry and other factors such as litigation and industrial relations.

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ANNEXURE ‘C’ TO DIRECTORS’ REPORT FOR THE YEAR ENDED 31st MARCH, 2010

CORPORATE GOVERNANCE(As required by Clause 49 of the Listing Agreement with the Stock Exchanges)

A. MANDATORY REQUIREMENTS

1] Company’s Philosophy:

The Company's Philosophy on Corporate Governance aims at the attainment of the highest levels of transparency, accountability andresponsibility in all operations and all interactions with its Shareholders, Investors, Lenders, Employees, Government and otherstakeholders.

The Company believes that all its operations and actions must serve the underlying goal of enhancing overall shareholder value, consistentlyover a sustained period of time.

2] Board of Directors:

The Board consists of a Vice Chairman & Managing Director and Wholetime Director and 10 other non-executive directors includingthree directors nominated by IDBI Bank Limited, Life Insurance Corporation of India and Housing and Urban Development CorporationLimited.

The Board functions both as a full Board and through Committees. The Board and Committees meet at regular intervals. Policy formulation,evaluation of performance and control functions vest with Board, while the Committees oversee operational issues.

The Board has constituted six Committees viz., Audit Committee, Share Transfer Committee, Shareholders'/Investors' GrievanceCommittee, Remuneration Committee, Compensation Committee and QIP Committee.

During the year 2009-2010, eight Board Meetings were held on 30.04.2009, 27.06.2009, 22.07.2009, 12.08.2009, 26.09.2009, 28.10.2009,25.01.2010 and 05.03.2010.

The composition of Directors, attendance at the Board Meetings during the year and the last Annual General Meeting and also numberof other directorships and Committee memberships are given below:

Sl. Name of the Director Category of No. of Board Attendance No. of other No. ofNo. Directorship meetings at last Director- Membership (M) /

attended AGM ships held Chairmanship(C)(From in public in other Board01.04.09 Companies Committee(s)*to 31.03.10) (As on 31/03/2010)

1. Sri N.Srinivasan Promoter,Vice Chairman & Managing Director Executive Director 8 Yes 13 2 (M) & 2 (C)

2. Mrs Chitra Srinivasan *1 Promoter,Non-Executive Director 1 NA Nil Nil

3. Ms Rupa Gurunath *2 Promoter,Wholetime Director Executive Director 8 Yes 2 Nil

4. Dr. B.S.Adityan Independent,Non-Executive Director 6 Yes 4 1 (C)

5. Sri Arun Datta*3 Independent,Non-Executive Director 2 NA 1 Nil

6. Sri R.K. Das Independent,Non-Executive Director 7 Yes 8 Nil

7. Sri N.R. Krishnan Independent,Non-Executive Director 8 Yes 4 3 (M) & 1 (C)

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Sl. Name of the Director Category of No. of Board Attendance No. of other No. ofNo. Directorship meetings at last Director- Membership (M) /

attended AGM ships held Chairmanship(C)(From in public in other Board01.04.09 Companies Committee(s)*to 31.03.10) (As on 31/03/2010)

8. Sri V. Manickam *1 Independent,Nominee of Life Insurance Non-Executive Director 6 No 1 NilCorporation of India in itscapacity as Lender/Shareholder

9. Sri K.P. Nair*4 Independent,Nominee of IDBI Bank Ltd., Non-Executive Director 2 NA Nil Nilin its capacity as Lender

10. Sri A. Sankarakrishnan Independent,Non-Executive Director 8 Yes 4 2 (M) & 1 (C)

11. Sri N. Srinivasan (F&R) Independent,Non-Executive Director 8 No 14 4 (M) & 5 (C)

12. Sri K.Subramanian Independent,Nominee of Housing and Urban Non-Executive Director 6 Yes 2 2 (M)Development Corporation Ltdin its capacity as Lender

13. Sri N. Ramachandran #1 Promoter,Executive Director Executive Director 2 Yes NA NA

14. Sri Arun Datta #2 Independent,Nominee of IDBI Bank Ltd in Non-Executive Director 4 No NA NAits capacity as Lender

*only Audit Committee and Shareholders’/Investors’ Grievance Committee are considered for the purpose.* 1 Appointed as an additional Director of the Board w.e.f. 05.03.2010.* 2 Appointed as Wholetime Director of the Board w.e.f. 05.03.2010.* 3 Appointed as an additional Director of the Board w.e.f. 28.10.2009.* 4 Appointed as Nominee Director of the Board w.e.f. 14.10.2009.# 1 Ceased to be Executive Director and Director of the Board w.e.f. 12.08.2009 (close of business hours).# 2 Ceased to be a Nominee Director of the Board w.e.f. 14.10.2009.

3] Audit Committee:The role and terms of reference of the Audit Committee cover the areas mentioned under Clause 49 of the Listing Agreement and Section292A of the Companies Act, 1956, besides other terms as may be referred to by the Board of Directors from time to time.The Audit Committee met five times during the year i.e., on 13.04.2009, 27.06.2009, 22.07.2009, 28.10.2009 and 25.01.2010.The composition and attendance of Audit Committee meetings are given below:

Sl. No. Name of the Member No. of Meetings held No. of Meetings attended

1. Dr. B.S.Adityan, Chairman 5 5

2. Sri Arun Datta *1 5 2

3. Sri R.K. Das *2 5 3

4. Sri N.Srinivasan (F&R) 5 5*1 Appointed as a member w.e.f. 25.01.2010 *2 Appointed as a member w.e.f. 27.06.2009The Company Secretary is also Secretary to the Audit Committee.

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4] Remuneration Committee & Policy:

The Remuneration Committee has been constituted to recommend/review the remuneration package of the wholetime Directors taking intoaccount their qualification, experience, expertise, contribution and the prevailing levels of remuneration in Companies of corresponding sizeand stature.During the year 2009-2010, Remuneration Committee met twice i.e. on 27th June 2009 and 5th March 2010 to recommend to the Board forpayment of• Commission to Mr.N.Srinivasan, Vice Chairman and Managing Director and Mr.N.Ramachandran, wholetime Director, out of net profit

of the Company for the year 2008-09, pursuant to the resolutions passed by the Shareholders at their Annual General Meeting held on24th September, 2007; and

• Remuneration including commission to Ms.Rupa Gurunath, wholetime Director.The composition and attendance of Remuneration Committee meetings are given below:

Sl. No. Name of the Member No. of Meetings held No. of Meetings attended

1. Dr. B.S. Adityan, Chairman 2 2

2. Sri N.Srinivasan (F&R) 2 2

3. Sri Arun Datta * 1 2 1* 1 Appointed as a member w.e.f. 25.01.2010.

Details of remuneration paid to the Directors for the year ended 31st March, 2010:

(i) Executive Directors:(Rs. Lakhs)

Name & Position Salary Commission Perquisites HRA Provident Fund Retirement Benefits Others Total

Sri N.SrinivasanVice Chairman & 360.00 1011.00 – 108.00 43.20 69.00 2.64 1593.84Managing Director

Ms. Rupa Gurunath * 1

Wholetime Director 8.71 0.00 – 2.61 1.05 1.72 0.00 14.09

Mr.N.Ramachandran #1

Executive Director 105.60 0.00 – 31.68 12.67 18.40 907.23 1075.58

* 1 Appointed as wholetime Director of the Board w.e.f. 05.03.2010.# 1 Ceased to be Executive Director and Director w.e.f. 12.08.2009 (close of business hours).

The two executive Directors (Managing Director and wholetime Director) are paid remuneration as decided by the Board of Directors onthe recommendation of the Remuneration Committee of the Board with the approval of Shareholders and IDBI Bank Limited.

There are no stock options available / issued to any Director of the Company.

(ii) Non-Executive Directors:Remuneration by way of sitting fees is paid to all non-executive directors at the rate of Rs.20,000/- for attending each meeting of theBoard and Rs.10,000/- for attending each committee meeting.Particulars of sitting fees including for committee meetings paid to non-executive directors during the financial year 2009-10 are asfollows:

Name of Directors Sitting Fees Paid (Rs.)

Mrs Chitra Srinivasan 20000Ms Rupa Gurunath*1 140000

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Name of Directors Sitting Fees Paid (Rs.)Dr. B.S.Adityan 440000Sri Arun Datta*2 50000Sri R.K.Das 170000Sri N.R. Krishnan 160000Sri V. Manickam (Paid to Life Insurance Corporation of India) 120000Sri Arun Datta & Sri K.P.Nair (Paid to IDBI Bank Limited) 100000 & 40000Sri A. Sankarakrishnan 190000Sri N. Srinivasan (F&R) 440000Sri K. Subramanian (Paid to Housing and Urban Development Corporation Ltd) 120000

*1 Appointed as Wholetime Director of the Board w.e.f. 05.03.2010.*2 Appointed as a member of the Board w.e.f. 28.10.2009.

No remuneration other than sitting fee as aforesaid is paid to Non-Executive Directors.There has been no pecuniary relationship or transactions between the Company and Non-Executive Directors during the year 2009-2010.There are no convertible instruments issued to any of the Non-Executive Directors of the Company. The details of Equity Shares of theCompany held by the Non-Executive Directors as on 31st March 2010, are as follows:

Name of Directors No. of Equity SharesMrs Chitra Srinivasan 78580Dr. B.S.Adityan 12704Sri Arun Datta 1000Sri R.K.Das 1500Sri N.R. Krishnan NilSri V. Manickam NilSri K.P.Nair NilSri A. Sankarakrishnan 1000Sri N. Srinivasan (F&R) NilSri K. Subramanian Nil

5] a] Share Transfer Committee:

All shares received for transfer were registered in favour of transferees and certificates despatched within a month's time, wherever thedocuments received were in order.During the year 2009-2010, 13,900 Equity Shares were transferred in physical mode in favour of transferees and despatched within amonth's time from the date of receipt.During the financial year 2009-2010, the Committee met 14 times.

The composition and attendance of the Share Transfer Committee meetings are given below:

Sl. No. Name of the Member No. of Meetings held No. of Meetings attended

1 Sri N.Srinivasan, Chairman 14 14

2 Dr. B.S.Adityan 14 13

3 Sri N.Srinivasan (F&R) 14 13

b] Shareholders’ / Investors’ Grievance Committee:

During the year 2009-2010, 162 complaints were received from shareholders and investors. All the complaints have generally beensolved to the satisfaction of the complainants, except for disputed cases and sub-judice matters, which would be solved on final disposalby the Courts/ Forums where they are pending.

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During the financial year 2009-2010, the Shareholders' / Investors' Grievance Committee met 4 times i.e., on 13.04.2009, 22.07.2009,13.10.2009 and 08.01.2010.The composition and attendance at the Shareholders'/Investors' Grievance Committee meetings are given below:

Sl. No. Name of the Member No. of Meetings held No. of Meetings attended1 Dr. B.S.Adityan, Chairman 4 42 Sri N.Srinivasan 4 4

Sri. G. Balakrishnan, Company Secretary is the Compliance Officer.

c] Compensation Committee of Board of Directors:A Compensation Committee of Board of Directors has been constituted for administration of India Cements Employees StockOption Scheme (ICL ESOS).During the year 2009-2010, the Committee met 4 times i.e. on 13.04.2009, 07.07.2009, 06.08.2009 and 07.12.2009 to• allot 32,750, 70,000, 15,250 & 31,750 Equity Shares of Rs.10/- each to the Employees who had exercised their options that

vested on 1st December 2008 and• grant 3,000 stock options to an eligible employee of the Company under ICL ESOS 2006.The composition and attendance at the Compensation Committee of Board of Directors are given below:

Sl. No. Name of the Member No. of Meetings held No. of Meetings attended

1 Sri N.Srinivasan, Chairman 4 42 Dr. B.S.Adityan 4 43 Sri N.Srinivasan (F&R) 4 4

d] QIP Committee of Board of Directors:QIP Committee of Board of Directors was constituted on 22.07.2009 for the purpose of issue and allotment of Equity shares underQualified Institutional Placement 2009-10.During the year 2009-2010, the Committee met 4 times i.e. on 26.08.2009, 08.03.2010, 11.03.2010 and 15.03.2010 to consider,issue and allot 2,45,94,000 Equity Shares of Rs.10/- each in favour of Qualified Institutional Buyers (QIBs) at a price ofRs.120.20 per share (including a premium of Rs.110.20 per share).The composition and attendance at the QIP Committee of Board of Directors are given below:

Sl. No. Name of the Member No. of Meetings held No. of Meetings attended1 Sri N.Srinivasan, Chairman 4 42 Dr. B.S.Adityan 4 43 Sri A.Sankarakrishnan 4 34 Sri N.Srinivasan (F&R) 4 4

6] Annual General Meetings:The last three Annual General Meetings were held as under:

Year Type Location Date TimeSpecial Resolutions passed inthe AGM by the Shareholders

2007 AGM Sathguru Gnanananda Hall, (Narada Gana Sabha),314, T.T.K. Road, Chennai 600 018. 24.09.2007 10.00 A.M. Yes

2008 AGM Sathguru Granananda Hall, (Narada Gana Sabha),314, T.T.K. Road, Chennai 600 018. 28.08.2008 10.00 A.M. No

2009 AGM Sathguru Granananda Hall, (Narada Gana Sabha),314, T.T.K. Road, Chennai 600 018. 07.08.2009 10.00 A.M. Yes

No special resolution was required to be put through postal ballot last year.

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No item of business relating to matters specified under Clause 49 of the Listing Agreement with the Stock Exchanges and/or theprovisions contained in Section 192A of the Companies Act, 1956, requiring voting by postal ballot is included in the Notice convening the64th Annual General Meeting of the Company.

7] Disclosures:

a) There are no significant Related Party transactions during the year of material nature with the promoters, directors or the managementor their subsidiaries or relatives, etc., potentially conflicting with Company's interests at large. Related Party transactions are disclosedin the notes to Accounts forming part of this Annual Report.

b) As per Clause 49(V) of the Listing Agreement, the Chief Executive Officer i.e. Managing Director and the Chief Financial Officer i.e. JointPresident (Finance & Accounts) certified to the Board on their review of financial statements and cash flow statements for the financialyear ended 31st March 2010 in the form prescribed by Clause 49 of the Listing Agreement which is annexed.

c) There were no instances of non-compliance on any matter relating to the capital market, during the last three years.

d) Presently, the Company does not have a Whistle Blower Policy.

e) The Company has complied with all mandatory requirements of the Clause 49 of the listing agreement. As regards the non-mandatoryrequirements the extent of compliance has been stated in Part B of this report.

f) Details of information on appointment of new / re-appointment of directors:

i. A brief resume, nature of expertise in specific functional areas, number of equity shares held in the company by the Director or forother person on a beneficial basis, names of companies in which the person already holds directorship, membership of committeesof the Board and relationship with other directors, forms part of the Notice convening the 64th Annual General Meeting.

ii. Details of information about the Nominee Director appointed by IDBI Bank Limited:

Name of the Director : Sri K.P.Nair

Date of Birth : 24th May 1959

Date of appointment on the Board as Director : 14th October 2009

Date of last reappointment as Director : NA

Expertise in specific functional areas : Human Resources

Qualification : B.Com., MBA.,

Number of Equity Shares held in the Company by theDirector or for other persons on a beneficial basis : Nil

List of outside Directorships held in Public Companies : Nil

Chairman / Member of the Committees ofBoard of Directors of the Company : Nil

Chairman / Member of the Committees of Board of Directors ofother Companies in which he is a Director : Nil

Relationship with other Directors : Nil

g) ICL Code of Conduct for Prevention of Insider Trading:

The Company has adopted and implemented ICL Code of Conduct for Prevention of Insider Trading based on SEBI (Prohibition ofInsider Trading) Regulations, 1992 as amended. The code prohibits purchase/sale of securities of the Company by an 'insider' includingDirectors, Designated employees etc., while in possession of unpublished price sensitive information.

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h) ICL Code of Conduct for Directors and Senior Management:

The Company has framed and implemented ICL Code of Conduct for its Directors and Senior Management. The code of conducthas also been posted on the Company's website "www.indiacements.co.in". Affirmation on compliance of Code of Conduct for thefinancial year 2009-10 has been received from all the Directors and Senior Management personnel of the Company.

i ) Transfer to Investor Education and Protection Fund:

The Company has transferred a sum of Rs. 2.44 lakhs during the financial year to the Investor Education and Protection Fundestablished by the Central Government. The said amount represents unclaimed fixed deposits including interest on fixeddeposits, which remained unclaimed with the Company for a period of 7 years from their respective due dates of payment.

j ) Unclaimed Shares:

The Company does not have any share(s) remaining unclaimed, issued pursuant to public / other issues.

k) Subsidiary Company:

The Company does not have a "material non-listed Indian subsidiary" as defined in clause 49(III) of the Listing Agreement.

8] Means of Communication:

a) Quarterly results are published in the pro-forma prescribed by Stock Exchanges, in leading English newspapers including 'TheHindu' and Tamil newspapers including 'Dina Thandhi'. As the Company publishes the audited annual results within the stipulatedperiod of 60 days from the close of the financial year as required by the Listing Agreement with Stock Exchanges, the unauditedresults for the last quarter of the financial year are not published.

b) The annual financial results of the Company are also communicated in the prescribed pro-forma to Stock Exchanges and alsopublished in the newspapers.

c) The financial results are displayed on the Company's website "www.indiacements.co.in".

9] General Information for Shareholders:

(i) Date, Time and Venue of the Annual General Meeting : 2nd August, 2010 at 10.00 A.M at Sathguru Gnanananda Hall,(Narada Gana Sabha), No.314, T.T.K. Road, Alwarpet, Chennai 600 018.

(ii) Financial year – 1st April to 31st March (Provisional) : Will be published on or before:

Results for Quarter ending June 30, 2010 : 14th August, 2010

Results for Quarter ending September 30, 2010 : 14th November, 2010

Results for Quarter ending December 31, 2010 : 14th February, 2011

Results for Quarter ending March 31, 2011 (audited) : 30th May, 2011

(iii) Date of Book Closure : 28th July , 2010 to 2nd August, 2010 (both days inclusive)

(iv) Dividend payment date : 31st August, 2010

(v) Listing on Stock Exchanges:

I a) The Company's Equity Shares are listed on the following Stock Exchanges:

i) Madras Stock Exchange Limited, Exchange Building, 11, Second Line Beach, Chennai - 600 001 (Stock Code: INDCEM )

ii) a) Bombay Stock Exchange Limited, P.J. Towers, Dalal Street, Fort, Mumbai - 400 001 (Stock Code : 30005) forphysical segment

b) Bombay Stock Exchange Limited (Stock Code : 530005) for demat segment

iii) National Stock Exchange of India Ltd., Exchange Plaza, 5th Floor, Plot No. C/1, G Block, Bandra-Kurla Complex,Bandra (E), Mumbai - 400 051 (Stock Code EQ: INDIACEM )

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b) Company's Equity Shares are traded in Group "A" category in Bombay Stock Exchange Limited.

c) The Company has paid the Listing Fees for the year 2010-11 to all Stock Exchanges where the Company's equityshares are listed.

II The Company's Global Depository Receipts (GDRs) are listed in Luxembourg Stock Exchange, P.O. Box 165, L-2811Luxembourg, Europe and Listing Fees for the year 2010 has been paid.

III The Company's Global Depository Shares (GDSs) are listed in Luxembourg Stock Exchange, P.O. Box 165, L-2811Luxembourg, Europe and Listing Fees for the year 2010 has been paid.

IV The equity shares of the Company have been included in the list of equity shares on which derivatives are available andthe shares also form part of an index on which derivatives are available for trading in futures and options segment byNational Stock Exchange of India Limited.

V The company's unsecured Zero Coupon Convertible Bonds due 2011 (FCCBs) for US$ 75000000 are listed on SingaporeExchange Securities Trading Limited, 2 Shenton Way, # 19-00 SGX Centre 1, Singapore and Listing Fees for the year2010 has been paid.

(vi) Market Price Data: (in Rupees)

Month Madras Stock Exchange Bombay Stock Exchange National Stock ExchangeLimited Limited of India Limited

High Low High Low High Low

April 2009 - - 130.30 106.45 130.20 106.55

May 2009 - - 153.95 109.45 154.15 109.10

June 2009 - - 177.95 130.85 177.50 131.00

July 2009 - - 152.65 129.85 152.50 129.75

Aug.2009 - - 154.60 126.95 154.55 126.85

Sep. 2009 - - 135.25 125.25 135.25 125.20

Oct. 2009 - - 134.95 110.30 135.20 110.45

Nov. 2009 - - 112.30 98.45 112.35 98.15

Dec. 2009 - - 124.05 113.65 124.10 113.50

Jan. 2010 - - 131.00 107.90 131.35 107.85

Feb. 2010 - - 124.80 111.95 124.85 112.00

Mar. 2010 - - 135.65 120.20 135.40 120.50

34

(viii) Registrar and Transfer Agents:The Company has appointed Integrated Enterprises (India) Limited as Registrar and Transfer Agents. Shareholders / Investors / DepositoryParticipants are requested to send all their documents and communications pertaining to both physical and demat shares to the Registrarat the following address:Integrated Enterprises (India) Limited2nd Floor, “Kences Towers”No.1, Ramakrishna StreetNorth Usman Road, T.NagarCHENNAI - 600017.Phone : 044-28140801 to 28140803 Fax: 044-28142479Email: corpserv@iepindia.com

(ix) Share Transfer System:Shares lodged in physical form with the Company/RTA are processed and returned, duly transferred, within 30 days from the date ofreceipt, if the documents submitted are in order. In case of shares in electronic form, the transfers are processed by NSDL/CDSLthrough the respective Depository Participants.

(x) a) Distribution of Shareholding as on 31st March, 2010:

No. of Shares held No. of % of Shareholders No. of Shares held % of ShareholdingShareholders

Up to 500 92921 91.65 10510630 3.42501 to 1000 4593 4.53 3688656 1.201001 to 2000 1970 1.94 2996640 0.982001 to 3000 609 0.60 1576329 0.513001 to 4000 291 0.29 1044478 0.344001 to 5000 227 0.22 1071583 0.355001 to 10000 328 0.32 2377511 0.7710001 and above 456 0.45 283909830 92.43TOTAL 101395 100.00 307175657 100.00

(vii) Stock price performance in comparison to BSE Sensex:

COMPANY SHARE PRICE AND BSE SENSEX

CO

MPA

NY

SH

AR

E P

RIC

E

BS

E S

EN

SE

X

20000180001600014000120001000080006000400020000

200.00180.00160.00140.00120.00100.00

80.0060.0040.0020.00

0.00

MONTH

BSE (ICL) BSE SENSEX

Apr- May- Jun- Jul- Aug- Sep- Oct- Nov- Dec- Jan- Feb- Mar-09 09 09 09 09 09 09 09 09 10 10 10

35

b) Pattern of Shareholding as on 31st March, 2010:

Category Category of shareholder Number Total Number of Total shareholding Shares Pledgedcode of share- number shares held as a percentage or otherwise

holders of shares in demater- of total number of encumberedialized form shares

As a As a Number As apercentage percentage of percentage

of (A+B) of (A+B+C) Shares

(I) (II) (III) (IV) (V) (VI) (VII) (VIII) (IX) =(VIII)/(IV) *

100

(A) Promoter and Promoter Group(1) Indian(a) Individuals / Hindu

Undivided Family 3 20015896 19954024 6.61 6.52 — —(b) Central Government /

State Government(s) — — — — — — —(c) Bodies Corporate 3 57040057 57030057 18.83 18.57 51486625 90.26(d) Financial Institutions / Banks — — — — — — —(e) Any Other (specify):

Directors & Relatives 5 288540 147400 0.09 0.09 — —Sub-Total (A) (1) 11 77344493 77131481 25.53 25.18 51486625 66.57

(2) Foreign(a) Individuals (Non-Resident

Individuals / Foreign Individuals) — — — — — — —(b) Bodies Corporate — — — — — — —(c) Institutions — — — — — — —(d) Any Other (specify) — — — — — — —

Sub-Total (A)(2) — — — — — — —Total Shareholding ofPromoter and PromoterGroup (A)= (A)(1)+(A)(2) 11 77344493 77131481 25.53 25.18 51486625 66.57

(B) Public shareholding N.A. N.A.

(1) Institutions N.A. N.A.(a) Mutual Funds / UTI 60 33783448 33768708 11.15 11.00 — —(b) Financial Institutions / Banks 30 1328200 1320271 0.44 0.43 — —(c) Central Government /

State Government(s) — — — — — — —(d) Venture Capital Funds — — — — — — —(e) Insurance Companies 8 27529628 27529378 9.09 8.96 — —(f) Foreign Institutional Investors 142 85093901 85052201 28.09 27.70 — —(g) Foreign Venture Capital Investors — — — — — — —(h) Any Other (specify) — — — — — — —

Sub-Total (B)(1) 240 147735177 147670558 48.77 48.09 — —

36

(2) Non-institutions N.A. N.A.(a) Bodies Corporate 1640 41046196 39480073 13.55 13.36 — —(b) Individuals

i. Individual shareholdersholding nominal share capitalupto Rs. 1 lakh 95961 19764551 18117291 6.52 6.43 — —

ii. Individual shareholdersholding nominal share capitalin excess of Rs. 1 lakh. 109 5408026 5249758 1.79 1.76 — —

(c) Any Other (specify)i Directors & Relatives 4 16204 2000 0.01 0.01 — —ii Foreign Corporate Body 3 8502095 8502095 2.81 2.77 — —iii Overseas Corporate Bodies 2 2000 1500 0.00 0.00 — —iv Non-Resident Individuals 1560 1049761 1044163 0.35 0.34 — —v Custodian of enemy

Property 37 11854 0 0.00 0.00 — —vi Trust 16 140399 140399 0.05 0.05 — —vii Hindu Undivided Families 1574 794790 794790 0.26 0.26 — —viii Clearing Member 236 1098855 1098855 0.36 0.36 — —

Sub-Total (B)(2) 101142 77834731 74430924 25.70 25.34 — —

Total Public Shareholding(B)= (B)(1)+(B)(2) 101382 225569908 222101482 74.47 73.43 N.A. N.A.

TOTAL (A)+(B) 101393 302914401 299232963 100.00 98.61 51486625 17.00

(C) Shares held by Custodiansand against which DepositoryReceipts have been issued N.A. N.A. N.A.

i. Global DepositoryReceipts (GDRs) 1 134266 122829 — 0.04 — —

ii. Global DepositoryShares (GDSs) 1 4126990 4126990 — 1.35 — —

TOTAL (C) 2 4261256 4249819 N.A. 1.39 N.A. N.A.

GRAND TOTAL (A)+(B)+(C) 101395 307175657 303482782 100.00 51486625 16.76

Category Category of shareholder Number Total Number of Total shareholding Shares Pledgedcode of share- number shares held as a percentage or otherwise

holders of shares in demater- of total number of encumberedialized form shares

As a As a Number As apercentage percentage of percentage

of (A+B) of (A+B+C) Shares

(I) (II) (III) (IV) (V) (VI) (VII) (VIII) (IX) =(VIII)/(IV) *

100

37

(xi) Dematerialisation of Equity Shares and Liquidity:As on 31st March, 2010, 98.80% of the Company's Equity Shares have been dematerialized.As per directives issued by SEBI, it is compulsory to trade in the Company's shares in the dematerialised form with effect from 29th November,1999. The ISIN Number allotted by National Securities Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL) fortrading in the Company's shares in Demat form is INE383A01012.During the year 2009-2010, the Company had received 276 requests for dematerialisation of shares. The Company has acted upon all validrequests received for dematerialisation during the year 2009-2010.

(xii) Outstanding GDRs / ADRs / Warrants or any Convertible Debentures, conversion date and likely impact on equity shares as on31st March, 2010.134266 GDRs are outstanding (0.04% of total paid up equity share capital). Each GDR represents one underlying equity share of Rs.10/- each.2063495 GDSs are outstanding. Each GDS represents two underlying equity shares of Rs.10/- each (4126990 underlying shares represented byGDS constitutes 1.35% of total paid up equity share capital).Unsecured Zero Coupon Convertible Bonds due 2011 (FCCBs), issued in May, 2006, for US$ 75000000 to investors outside India at an initialconversion price of Rs.305.57 per share. The Bonds are convertible by holders into fully paid up equity shares or Global Depositary Shares atany time on or after 21st June, 2006 but on or before 5th May, 2011. The Bonds can be called for redemption under certain circumstances, beforeMay, 2011 but not earlier than 11th May, 2008. Unless previously redeemed, converted or purchased and cancelled, the company will redeemeach bond at 147.70% of its principal amount on the maturity date i.e., 12th May, 2011.14,79,000 options were issued to eligible employees under India Cements Employees Stock Option Scheme, 2006. In terms of the Scheme,50% of the options allotted to an employee vested on 1st December 2007 and the balance 50% on 1st December 2008. Each option on suchvesting can be exercised by applying for an equity share of Rs.10/- each fully paid up for a sum of Rs.50/- (inclusive of premium of Rs.40/-) onor before 1st December 2008 and 1st December 2009 respectively.Out of 7,23,500 options vested on 01/12/2007,• 7,06,500, 12,000 & 500 options were exercised by the employees and equal number of shares were allotted to them on 27/12/2007,

09/04/2008 & 02/12/2008 respectively and• balance 4,500 options lapsed since the same were not exercised.Out of 7,07,000 options vested on 01/12/2008,• 4,87,000, 63,250, 32,750, 70,000, 15,250 & 31,750 options were exercised by the employees and equal number of shares were allotted to

them on 22/12/2008, 02/02/2009,13/04/2009, 07/07/2009, 06/08/2009 & 07/12/2009 respectively and• balance 7,000 options lapsed since the same were not exercised.The Compensation Committee granted 3,000 stock options to an eligible employee of the Company on 6th August 2009. These options are yetto vest.

(xiii) Plant Locations:

Sankarnagar, Tirunelveli District, Tamil Nadu Chilamakur, Cuddapah District, Andhra PradeshSankari, Salem District, Tamil Nadu Yerraguntla, Cuddapah District, Andhra PradeshDalavoi, Perambalur District, Tamil Nadu Vishnupuram, Nalgonda District, Andhra PradeshVallur Village, Tiruvallur District, Tamil Nadu Malkapur, Ranga Reddy District, Andhra Pradesh

Parli Vaijynath, Beed District, Maharashtra

(xiv) Address for Correspondence : The India Cements Limited,Regd. Office: “Dhun Building”,827, Anna Salai, Chennai 600 002.Corporate Office: “Coromandel Towers”,93, Santhome High Road, Karpagam Avenue,R.A. Puram, Chennai - 600 028Tel. No. : (091) (044) 285215 26/27/30Fax No. : (091) (044) 28517198/28520638

Investor Complaints under Clause 47(f) of the Listing AgreementContact Person : Sri G.Balakrishnan

President & Company SecretaryEmail-Id : investor@indiacements.co.in

38

: The Company does not have a non-executive Chairman.

: No tenure has been fixed for independent directors.

: This is ensured.

: Please refer to Serial No. A - 4 of this Report.

: As the Company's half yearly results are published in leading Englishnewspapers having circulation all over India and in Tamil newspapersand also in the Company's website, the same are not sent to theShareholders of the Company. There is no publication of second half-yearly results as the annual results are approved by the Board and thenpublished in the newspapers and also communicated to the shareholdersthrough the Annual Report.

: Nil

: At present, the Company does not have any such Training programme forDirectors.

: At present, the Company does not have any such mechanism for evaluatingthe performance of non-executive Board Members.

: The Company does not have a Whistle Blower Policy.

B. NON-MANDATORY REQUIREMENTS:1. The Board - A Non-executive Chairman may be

entitled to maintain a Chairman's office at theCompany's expense and also allowedreimbursement of expenses incurred in performanceof his duties.

Independent Directors may have a tenure notexceeding, in the aggregate, a period of nine years,on the Board of a company.

The company may ensure that the person who isbeing appointed as an independent director has therequisite qualifications and experience which wouldbe of use to the company and which, in the opinion ofthe company, would enable him to contributeeffectively to the company in his capacity as anindependent director.

2. Remuneration Committee.

3. Shareholders Rights- A half-yearly declaration offinancial performance including summary of thesignificant events in last six months, may be sent toeach household of Shareholders.

4. Audit qualifications - Company may move towards aregime of unqualified financial statements.

5. Training of Board Members - A Company may trainits Board Members in the business model of theCompany as well as the risk profile of the businessparameters of the Company, their responsibilities asdirectors and the best ways to discharge them.

6. Mechanism for evaluating non-executive BoardMembers - The performance evaluation of non-executive directors could be done by a Peer Groupcomprising the entire Board of Directors, excludingthe director being evaluated; and Peer Groupevaluation could be the mechanism to determinewhether to extend / continue the terms of appointmentof non-executive directors.

7. Whistle Blower Policy.

The Ministry of Corporate Affairs, Government of India, has issued in December 2009 "Corporate Governance Voluntary Guidelines2009". While the Board welcomes the issue of these guidelines intended for better governance of corporates, introduction of therecommended measures will be considered carefully at the appropriate time.

39

CEO AND CFO CERTIFICATION

To the Board of Directors of The India Cements Limited

In compliance with Clause 49(V) of the Listing Agreement with the Stock Exchanges, we hereby certify that:

(a) We have reviewed financial statements and the cash flow statements for the year ended 31st March 2010 and that to the best of ourknowledge and belief:

(i) these statements do not contain any materially untrue statement or omit any material fact or contain statements that might be misleading;

(ii) these statements together present a true and fair view of the Company's affairs and are in compliance with existing accounting standards,applicable laws and regulations; and

(b) There are, to the best of our knowledge and belief, no transactions entered into by the Company during the year 2009-2010, which arefraudulent, illegal or violative of the Company's code of conduct.

(c ) We accept responsibility for establishing and maintaining internal controls and that we have evaluated the effectiveness of the internal controlsystems of the Company and we have not observed any deficiencies in the design or operation of internal controls.

(d) We have indicated to the auditors and the Audit Committee that there are:

(i) no significant changes in the internal control during the year;

(ii) no significant changes in accounting policies during the year; and

(iii) no instances of significant fraud where the involvement of management or an employee having a significant role in the Company'sinternal control system have been observed.

Place : Chennai N.Srinivasan R.Srinivasan

Date : 30th April 2010 Vice Chaiman & Managing Director Joint President (Finance & Accounts)

40

ANNEXURE ‘D’ TO DIRECTORS’ REPORT FOR THE YEAR ENDED 31ST MARCH, 2010

AUDITORS’ CERTIFICATE ON CORPORATE GOVERNANCE

ToThe Members, The India Cements Limited.

We have examined the compliance of conditions of Corporate Governance by The India Cements Limited, for the year ended March 31, 2010, asstipulated in clause 49 of the Listing Agreement of the said Company with Stock Exchange(s).

The compliance of conditions of Corporate Governance is the responsibility of the Management. Our examination was limited to procedures andimplementation thereof, adopted by the Company for ensuring the compliance of the conditions of the Corporate Governance. It is neither an auditnor an expression of opinion on the financial statements of the Company.

In our opinion and to the best of our information and according to the explanations given to us and the representations made by the Directors andthe Management, we certify that the Company has complied with the conditions of Corporate Governance as stipulated in the above-mentionedListing Agreement.

As required by the Guidance Note issued by The Institute of Chartered Accountants of India, we have to state that as per the records maintainedby the Company, there were no investor grievances remaining unattended/pending for more than 30 days.

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

For P. S. SUBRAMANIA IYER & Co., For BRAHMAYYA & CO.,Firm Registration No. 004104S Firm Registration No. 000511SChartered Accountants Chartered AccountantsG. HARIHARAN N. SRI KRISHNAPartner PartnerMembership No.15071 Membership No. 26575

Place : ChennaiDate : 30th April 2010

ANNEXURE ‘E’ TO DIRECTORS’ REPORT FOR THE YEAR ENDED 31ST MARCH, 2010

CODE OF CONDUCT – DECLARATION UNDER CLAUSE 49(I)(D)

This is to certify that :

1. In pursuance of the provisions of Clause 49(I)(D) of the Listing Agreement with Stock exchanges, a Code of Conduct for the Board membersand the Senior Management Personnel of the Company has been approved by the Board in its meeting held on 9th November 2005.

2. The said Code of Conduct has been uploaded on the website of the Company and has also been circulated to the Board members and theSenior Management Personnel of the Company.

3. All Board members and Senior Management Personnel have affirmed compliance with the said Code of Conduct, for the period ended 31stMarch 2010.

for THE INDIA CEMENTS LIMITED

Place : Chennai N. SRINIVASAN

Date : 30th April 2010 VICE CHAIRMAN & MANAGING DIRECTOR

41

ANNEXURE ‘F’ TO DIRECTORS’ REPORT FOR THE YEAR ENDED 31ST MARCH, 2010DISCLOSURE IN THE DIRECTORS’ REPORT 2010 – INDIA CEMENTS ESOS 2006(a) Options granted : 14,79,000 options granted on 16.11.2006

3,000 options granted on 06.08.2009 (yet to be vested)

(b) The pricing formula : Rs.50 per equity share including a premium of Rs.40/-.

(c) Options vested : Options vested on Options vested on01/12/2007 01/12/2008

7,23,500 7,07,000

(d) Options exercised : 7,19,000 7,00,000

(e) The total number of shares arising as a result of exercise of option : 7,19,000 7,00,000

(f) Options lapsed : 4,500 7,000

(g) Variation of terms of options : Nil Nil

(h) Money realized by exercise of options : Rs.3.595 Crores Rs.3.50 Crores

(i) Total number of options in force : Nil Nil

(j) Employee-wise details of options granted to - :

(i) Senior Managerial Personnel :

Name & Designation : No. of options granted

Mr.T.S. Raghupathy, Executive president : 18,000

Mr. PL .Subramanian, Sr.President (Operations) : 18,000

(ii) Any other employee who receives a grant in any one year of optionamounting to 5% or more of option granted during that year : None

(iii) Identified employees who were granted option, during any oneyear, equal to or exceeding 1% of the issued capital (excludingoutstanding warrants and conversions) of the Company at the time of grant : None

(k) Diluted Earnings Per Share (EPS) pursuant to issue of shares on exercise EPS including ESOS 2006 EPS excluding ESOS 2006of option calculated in accordance with Accounting Standard 20 (Rs.) (Rs.)

Basic 12.49 12.55Diluted 11.04 11.10

(l) Where the company has calculated the employee compensation cost : Being a listed Company, the market price quoted onusing intrinsic value of the Stock Options, the difference between the National Stock Exchange of India Limited (NSE) wasemployee compensation cost so computed and the employee compen- adopted (i.e. @ Rs.86.95 per share).sation cost that shall have been recognized if it had used the fair value ofthe options, shall be disclosed. The impact of this difference on profitsand on EPS of the Company shall also be disclosed

(m) Weighted-average exercise prices and weighted-average fair : exercise price - Rs.50/- per share (option)values of options shall be disclosed separately for options fair value - Rs.86.95 per share (option)whose exercise price either equals or exceeds or is less thanthe market price of the Stock on the grant date

(n) A description of the method and significant assumptions used during theyear to estimate the fair values of options, including the followingweighted-average information(1) Risk-free interest rate : –(2) Expected life : –(3) Expected volatility : –(4) Expected dividends and : –(5) The price of the underlying share in market at the time of

option grant : Rs.86.95 per share

42

AUDITORS’ REPORT

Auditors’ Report To The Members of The India Cements Limited.1. We have audited the attached Balance Sheet of The India Cements Limited ('the company') as at March 31,2010 and also

the relative Profit and Loss Account and Cash Flow Statement for the year ended on that date annexed thereto, which wehave signed under reference to this report. These financial statements are the responsibility of the Company's management.Our responsibility is to express an opinion on these financial statements based on our audit.

2. We have conducted our audit in accordance with Auditing Standards generally accepted in India. Those standards requirethat we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free ofmaterial misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in thefinancial statements. An audit also includes assessing the accounting principles used and significant estimates made bymanagement, as well as evaluating the overall financial statement presentation. We believe that our audit provides areasonable basis for our opinion.

3. As required by the Companies (Auditor's Report) Order, 2003, as amended by the Companies (Auditor's Report) (Amendment)Order, 2004,issued by the Government of India in terms of Section 227 (4A) of the Companies Act, 1956 of India (the Act)and on the basis of such checks as we considered appropriate and according to the information and explanations given tous, we set out in the Annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order.

4. Further to our comments in the Annexure referred to in paragraph 3 above, we report that:(a) We have obtained all the information and explanations, which to the best of our knowledge and belief were necessary

for the purposes of our audit;(b) In our opinion, the Company has kept proper books of account as required by law so far, as appears from our examination

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

the books of account;(d) In our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement read together with the notes

thereon dealt with by this report have been prepared, in all material respects, in compliance with the Accounting Standardsreferred to in sub-section (3C) of Section 211 of the Act to the extent applicable;

(e) On the basis of explanations and information given to us and written representations received from directors as onMarch 31, 2010 and taken on record by the Board of Directors, we report that none of the directors is disqualified as onMarch 31, 2010 from being appointed as a director in terms of Clause (g) of Sub Section (1) of Section 274 of theCompanies Act, 1956 having regard to the provisions of the scheme approved by CDR cell;

(f) In our opinion and to the best of our information and according to the explanations given to us, the said financial statementstogether with the notes thereon attached thereto give in the prescribed manner the information required by the Act andalso give a true and fair view in conformity with the accounting principles generally accepted in India:(i) In the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2010;(ii) In the case of the Profit and Loss Account, of the Profit for the year ended on that date; and

(iii) In the case of the Cash Flow Statement, of the Cash Flows for the year ended on that date.

For P. S. SUBRAMANIA IYER & Co., For BRAHMAYYA & Co.,Firm Registration No: 004104S Firm Registration No. 000511SChartered Accountants Chartered AccountantsG.HARIHARAN N.SRI KRISHNAPartner PartnerMembership No. 15071 Membership No. 26575

Place : ChennaiDate : 30th April, 2010

P.S. SUBRAMANIA IYER & CO. BRAHMAYYA & CO.Chartered Accountants Chartered Accountants103, P.S. Sivaswamy Salai 48, Masilamani RoadMylapore Balaji Nagar, RoyapettahChennai - 600 004 Chennai - 600 014

43

ANNEXURE TO AUDITORS’ REPORT (REFERRED TO IN PARAGRAPH 3 OF OUR REPORT OF EVEN DATE TO THE MEMBERS OFTHE INDIA CEMENTS LIMITED)

(i) a) The Company has maintained proper records showing full particulars including quantitative details and situation of fixed assets.b) As explained to us, the Fixed Assets are physically verified by the management, according to a phased programme designed to

cover all the items over a period of two years, which in our opinion, is reasonable having regard to the size of the Company andthe nature of its assets. Pursuant to the programme, the management during the year has physically verified a portion of fixedassets and no material discrepancies between the book records and physical inventory have been noticed.

c) The fixed assets disposed off during the year, in our opinion, do not constitute substantial part of the fixed assets of the companyand such disposal has, in our opinion, not affected the going concern status of the Company.

(ii) a) According to information and explanations given to us the inventories of the Company at all its locations have been physicallyverified during the year by the management. In our opinion, the frequency of verification is reasonable.

b) In our opinion and according to the information and explanations given to us, the procedures for physical verification ofinventories followed by the management are reasonable and adequate in relation to the size of the company and the nature of itsbusiness.

c) In our opinion and according to the explanations given to us and on the basis of our examination of the inventory records, we areof the opinion that the Company is maintaining proper records of inventory. The discrepancies noticed on physical verificationof inventory as compared to book records, have been properly dealt with in the books of account.

( i i i ) a) According to the information and explanations given to us the company has not granted any loans, secured or unsecured tocompanies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. Accordingly,sub-clause (b), (c) and (d) of Paragraph 4 of the Order are not applicable.

b) According to the information and explanations given to us the company has not taken any loans, secured or unsecured fromcompanies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956. Accordingly,sub-clause (f) and (g) of Paragraph 4 of the Order are not applicable.

(iv) In our opinion and according to the information and explanations given to us, there are adequate Internal control procedurescommensurate with the size of the company and the nature of its business with regard to purchases of inventory, fixed assets andwith regard to the sale of goods and services. Further, on the basis of our examination of the books and records of the Company, andaccording to the information and explanations given to us, we have neither come across nor have been informed of any continuingfailure to correct major weaknesses in the aforesaid internal control procedures of the Company.

(v) To the best of our knowledge and belief and according to the information and explanations given to us, there were no transactionsduring the year pursuant to the contracts or arrangements referred to in Section 301 of the Act. Accordingly, sub clause (b) Paragraph4 of the Order is not applicable.

(vi) The Company has during the year accepted deposits from public. In our opinion, the company has complied with the provisions ofSections 58A, 58AA or any other relevant provisions of the Act and Companies (Acceptance of Deposit) Rules, 1975. To the best ofour knowledge and according to the information and explanations given to us, no order has been passed by Company Law Board orNational Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal, in this regard.

(vi i ) In our opinion, the Company has an internal audit system commensurate with the size and nature of its business.(vi i i) We have broadly reviewed the cost records and accounts relating to materials, labour and other items of cost maintained by the

Company pursuant to the Rules made by the Central Government for the maintenance of cost records under section 209 (1) (d) ofthe Companies Act, 1956 and we are of the opinion that prima facie the prescribed accounts and records have been made andmaintained. We have however not made a detailed examination of the said records with a view to determine whether they areaccurate or complete. To the best of our knowledge and according to information and explanations given to us the Central Governmenthas not prescribed maintenance of cost records under section 209(1) (d) of the Companies Act, 1956 for any other activity ofthe Company.

(ix) a) According to the records of the Company, the Company is generally regular in depositing the undisputed statutory dues includingProvident Fund, Employee State Insurance, Investor Education and Protection Fund, Income tax, Wealth tax, Customs duty,Excise duty, Cess, Sales tax and Service tax and any other statutory dues applicable to it with the appropriate authorities thoughthere has been few delays in depositing Sales tax and Service tax.

P.S. SUBRAMANIA IYER & CO. BRAHMAYYA & CO.Chartered Accountants Chartered Accountants103, P.S. Sivaswamy Salai 48, Masilamani RoadMylapore Balaji Nagar, RoyapettahChennai - 600 004 Chennai - 600 014

44

b) According to the information and explanations given to us, no undisputed amounts payable in respect of Income tax, Wealth tax,Service tax, Sales tax, Customs duty, Excise duty and Cess were in arrears as at the year end for a period of more than sixmonths from the date they became payable except for Service tax on transporters amounting to Rs.62.89 lakhs which has beensince paid.

c) According to the information and explanations given to us, details of dues of Sales tax, Income tax, Wealth tax, Service tax,Customs duty, Excise duty and Cess, which have not been deposited as on 31st March,2010 on account of any dispute is as perAnnexure.

(x) The Company does not have any accumulated losses at the end of the financial year and has not incurred cash losses duringfinancial year covered by our audit and the immediately preceding financial year.

(xi) According to the information and explanations given to us the debt portfolio of the Company was restructured through Corporate DebtRestructuring Scheme (CDR), based on the said scheme the Company has not defaulted in repayments of its dues to financial institution,bank or debenture holders.

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

(xiii) The company is not a chit fund or a nidhi mutual benefit fund /society. Therefore, the provisions of paragraph 4(xiii) of the Companies(Auditor's Report) Order, 2003 are not applicable to the company.

(xiv) In our opinion, and according to the information and explanation given to us, the company is not dealing in or trading in shares, securities,debentures and other investments. Accordingly, the provisions of paragraph 4 (xiv) of the Companies (Auditor's Report) Order, 2003 arenot applicable to the Company.

(xv) In our opinion, the terms and conditions on which the company has given guarantees for loans taken by others from banks or financialinstitutions are not prejudicial to the interest of the Company taking into consideration the overall realisable value of assets and currentbusiness plans.

(xvi) In our opinion and according to the information and explanations given to us and on an overall examination, the term loans have beenapplied for the purpose for which they were obtained.

(xvii) In our opinion and according to the information and explanations given to us and on an overall examination of the Balance Sheet of theCompany, we report that no funds raised on short-term basis have been used for long-term investment.

(xviii) According to the information and explanations given to us, the Company has not made any preferential allotment of shares to parties andcompanies covered in the register maintained under Section 301 of the Act.

(xix) According to the information and explanations given to us, the Company has created the securities or charges in respect of secureddebentures issued and outstanding at the year-end as per original terms of issue not withstanding modifications, reschedulement and otherchanges in the terms as agreed with CDR cell.

(xx) The company has not raised any money through public issue during the year.

(xxi) During the course of our examination of the books and records of the Company, carried out in accordance with the generally acceptedAuditing Practices in India, and according to the information and explanations given to us, we have not come across any fraud on or by thecompany, noticed or reported during the year, nor have we been informed of such case by the management.

For P. S. SUBRAMANIA IYER & Co., For BRAHMAYYA & Co.,Firm Registration No: 004104S Firm Registration No. 000511SChartered Accountants Chartered AccountantsG.HARIHARAN N.SRI KRISHNAPartner PartnerMembership No. 15071 Membership No. 26575

Place : ChennaiDate : 30th April, 2010

P.S. SUBRAMANIA IYER & CO. BRAHMAYYA & CO.Chartered Accountants Chartered Accountants103, P.S. Sivaswamy Salai 48, Masilamani RoadMylapore Balaji Nagar, RoyapettahChennai - 600 004 Chennai - 600 014

45

Annexure to the Auditors’ Report to the Members of The India Cements Limited for the year ended31st March 2010

P.S. SUBRAMANIA IYER & CO. BRAHMAYYA & CO.Chartered Accountants Chartered Accountants103, P.S. Sivaswamy Salai 48, Masilamani RoadMylapore Balaji Nagar, RoyapettahChennai - 600 004 Chennai - 600 014

Category Pending With Financial Year Amount Rs. Lakhs

Cenvat Addl. Commissioner 2007-08, 2008-09, 2009-10 104.01Appellate Tribunal 1995-96, 1996-97, 1997-98, 1998-99, 1999-00, 2001-02, 2005-06, 2006-07,

2007-08, 2008-09, 2009-10 1544.24Asst. Commissioner 1998-99, 2007-08, 2008-09, 2009-10 35.69Commissioner 2002-03, 2003-04, 2004-05, 2006-07, 2007-08, 2008-09, 2009-10 819.48Commissioner (Appeals) 2000-01, 2006-07, 2007-08, 2008-09, 2009-10 147.80High Court 1994-95, 1995-96, 1996-97, 1997-98, 1998-99, 2000-01, 2006-07, 2007-08 254.63Jt. Commissioner 2005-06 14.01Supreme Court 2008-09 709.74Dy. Commissioner 2008-09 1.29Commissioner 2009-10 635.62

CST Asst. Commissioner 1973-74 4.17High Court 1991-92, 1992-93, 1993-94 76.17

Income Tax Appellate Tribunal 1991-92, 2001-02 94.84Asst. Commissioner 2007-08 2021.00High Court 1982-83, 1983-84, 1984-85, 1985-86, 1986-87 363.83Supreme Court 1996-97 810.64

Sales Tax Appellate Tribunal 1985-86, 1986-87, 1987-88, 1996-97 21.83Asst. Commissioner 1970-71, 1971-72, 1975-76, 1976-77, 1977-78, 1978-79, 1990-91 120.50Dy. Commissioner (Appeals) 1997-98, 2000-01 16.70High Court 1969-70, 1970-71, 1988-89, 1989-90, 1990-91, 1991-92, 1992-93, 1993-94,

1994-95, 1995-96, 1996-97, 1997-98, 1998-99, 2002-03 1101.23Supreme Court 1998-2003 5873.00

Service Tax Addl. Commissioner 1997-98, 2005-06, 2006-07 74.00Appellate Tribunal 2003-04, 2004-05, 2005-06, 2007-08, 2008-09 1377.90Asst. Commissioner 2008-09 3.36Commissioner 2006-07, 2008-09, 2009-10 4380.05Commissioner (Appeals) 2000-01, 2006-07, 2007-08, 2008-09 74.18High Court 2005-06, 2006-07, 2007-08 66.71Jt. Commissioner 2007-08 40.81

VAT Dy Commissioner (Appeals) 2005-06, 2006-07, 2007-08 183.78High Court 2005-06, 2006-07, 2007-08 647.62Jt. Commissioner 2008-09 252.61Dy. Commissioner 2009-10 81.05

Total 21952.49

For P. S. SUBRAMANIA IYER & Co., For BRAHMAYYA & Co.,Firm Registration No: 004104S Firm Registration No. 000511SChartered Accountants Chartered AccountantsG.HARIHARAN N.SRI KRISHNAPartner PartnerMembership No. 15071 Membership No. 26575

Place : ChennaiDate : 30th April, 2010

46

BALANCE SHEETAS AT 31st MARCH 2010

2010 2009Schedule Rs.Lakhs Rs.Lakhs Rs.Lakhs Rs.Lakhs

SOURCES OF FUNDS :

1 Shareholders’ Funds :a. Capital 1 30717.45 28243.05b. Reserves and Surplus 2 382864.95 413582.40 334895.93 363138.98

2 Loan Funds :a. Secured Loans 3 86664.36 103624.99b. Unsecured Loans

i) From Banks and others 4 32308.04 1172.45ii) Foreign Currency Convertible Bonds 33682.50 38040.00

(Note No.21)iii) Interest free Sales tax deferral loans 60618.14 213273.04 55965.52 198802.96

3 Deferred Tax Liability (Note No. 27) 28990.54 27406.24

655845.98 589348.18APPLICATION OF FUNDS :1 Fixed Assets : 5

a. Gross Block 571020.37 531357.77b. Less : Depreciation 179158.70 150532.59c. Net Block 391861.67 380825.18d. Capital Work-in-Progress 70288.97 462150.64 90404.11 471229.29

2 Investments 6 31397.33 15897.333 Current Assets, Loans and Advances : 7

a. Inventories 44776.53 37049.84b. Real Estate-Projects in Progress 2042.47 2042.47c. Sundry Debtors 48525.88 35397.81d. Cash and Bank Balances 5381.34 8519.74e. Loans and Advances 186918.61 131342.97

287644.83 214352.83Less : Current Liabilities and Provisions 8 127410.35 160234.48 115331.62 99021.21

4. Deferred tax Asset (Note No. 27) 2063.53 1845.23

5 Miscellaneous expenditure to the extentnot written off or adjusted:Deferred Revenue Expenditure (Note No. 6) 0.00 1355.12

655845.98 589348.18As per our Report of 30th April, 2010

For P.S.SUBRAMANIA IYER &CO., For BRAHMAYYA & CO., N.SRINIVASAN B.S.ADITYAN ARUN DATTAChartered Accountants Chartered Accountants Vice Chairman & Managing Director R.K. DAS N.R. KRISHNANG.HARIHARAN N.SRI KRISHNA V. MANICKAM A. SANKARAKRISHNANPartner Partner RUPA GURUNATH N. SRINIVASAN K. SUBRAMANIANMembership No. 15071 Membership No. 26575 Wholetime Director Directors

Place : Chennai R. SRINIVASAN G.BALAKRISHNANDate : 30th April, 2010 Joint President (Finance & Accounts) President & Company Secretary

47

PROFIT AND LOSS ACCOUNTFOR THE YEAR ENDED 31st MARCH 2010

2010 2009Note No. Schedule Rs.Lakhs Rs.Lakhs Rs.Lakhs Rs.Lakhs

INCOME :Sales and Other Income 9 422169.20 395453.55Less: Excise Duty (41343.59) (47963.20)Total Income net of Excise Duty 380825.61 347490.35EXPENDITURE:Manufacturing and Other Operating Expenses 10 163979.68 141224.51Salaries,Wages and Amenities 11 24997.29 19831.62Administration and Other Charges 12 16375.67 12805.02Selling and Distribution Expenses 9 87364.33 68026.64Interest & Other Charges (net) 20 13 14263.97 11214.93Depreciation 29327.30 26317.28Less : Transfer from Revaluation Reserve (5716.44) (5686.44)Less : Transfer from Deferred Income (298.80) 23312.06 (298.80) 20332.04Directors’ Remuneration 14 2683.51 2316.01Donations 15 598.87 316.08(Increase)/Decrease in Stock 16 (1524.36) (1340.73)Total Expenditure 332051.02 274726.12Profit before tax and Extraordinary items 48774.59 72764.23Extraordinary items:Share / Bonds issue expenses 1327.96 0.00Less: Transfer from Share Premium (1327.96) 0.00

0.00 0.00Foreign currency translation difference on FCCBs 21 4357.50 (7942.50)Profit before tax for the year 53132.09 64821.73Prior year income (net) 0.00 8.67Profit before tax 53132.09 64830.40Provision for taxes:Fringe Benefits tax 0.00 478.20Current tax 16332.00 18145.00Less: Deferred Tax Liability 27 1366.00 2989.55Profit after tax 35434.09 43217.65Balance from previous year 82341.05 52732.02

117775.14 95949.67Less: Proposed Dividend @ 20% on Equity Capital (Previous year: 20%)

and dividend distribution tax thereon (7163.95) (6608.62)Less: Transfer to Contingency Reserve (5000.00) 0.00Less: Transfer to General Reserve (7000.00) (7000.00)Balance carried to Balance Sheet 98611.19 82341.05Earnings Per Share (Rs.) - Basic 28 12.49 15.32Earnings Per Share (Rs.) - Diluted 28 11.04 15.32Notes on Accounts 17As per our Report of 30th April, 2010

For P.S.SUBRAMANIA IYER &CO., For BRAHMAYYA & CO., N.SRINIVASAN B.S.ADITYAN ARUN DATTAChartered Accountants Chartered Accountants Vice Chairman & Managing Director R.K. DAS N.R. KRISHNANG.HARIHARAN N.SRI KRISHNA V. MANICKAM A. SANKARAKRISHNANPartner Partner RUPA GURUNATH N. SRINIVASAN K. SUBRAMANIANMembership No. 15071 Membership No. 26575 Wholetime Director Directors

Place : Chennai R. SRINIVASAN G.BALAKRISHNANDate : 30th April, 2010 Joint President (Finance & Accounts) President & Company Secretary

48

SCHEDULE 1

SHARE CAPITAL No. of 2010 No. of 2009Shares Rs.Lakhs Shares Rs.Lakhs

AUTHORISED :Equity Shares of Rs.10 each 460000000 46000.00 460000000 46000.00Redeemable Cumulative Preference Shares of Rs.100 each 7500000 7500.00 7500000 7500.00

53500.00 53500.00ISSUED :Equity Shares of Rs.10 each 307175723 30717.57 282431973 28243.20

30717.57 28243.20SUBSCRIBED :Equity Shares of Rs.10 each 307175657 30717.57 282431907 28243.20Less : Calls in arrears (other than Directors) 3492 0.12 3537 0.15

307172165 30717.45 282428370 28243.05

Notes :

1. 14,00,000 Equity Shares of Rs.10/- each (28,00,000 Equity Shares of Rs.5/- each before consolidation) were issued as fully paidup bonus shares in 1969 by capitalisingRs.140 lakhs out of General Reserve and 321,68,291 Equity Shares of Rs.10/- each were issued as fully paid up bonus shares in 1996 by capitalising Rs.32,16,82,910out of Share Premium.

2. During the year 1994-95, the company allotted 58,57,987 equity shares of Rs. 10/- each consequent to issue of equivalent number of Global Depository Receipts(GDR).

3. During the year 1995-96, the company allotted 15,00,000 equity shares of Rs. 10/- each to promoters group on exercise of their option to subscribe against the warrantsissued at Rs. 215/- per share in the ratio of one share per warrant.

4. During the year 1998-99, the company allotted 6,43,38,002 rights equity shares of Rs. 10/- each in the ratio of 1:1 at a premium of Rs. 15/- per share.

5. During the year 1999-2000, the company allotted 1,08,69,500 equity shares of Rs. 10/- each at a premium of Rs. 82/- per share to the Foreign Institutional Investors.

6. During the year 2005-06, the company allotted 5,12,27,592 underlying equity shares of Rs.10/- each represented by 2,56,13,796 Global Depository Shares (GDS) inthe ratio of 2:1.

7. During the year 2006-07, the company allotted 2,96,00,561 equity shares of Rs. 10/- each at a price of Rs. 47/- per share on conversion of equity warrants issued toADRC Limited, Mauritius.

8. During the year 2006-07, the company issued Zero Coupon Convertible Bonds aggregating to USD 75 million, with an option to convert at a price ofRs. 305.57 per equity share of Rs.10/- each fully paid up, with a fixed rate of conversion of Rs.44.77 per USD and approximately 109,88,481 shares would be issuableon May 12, 2011 on conversion.

9. During the year 2006-07, the company announced Employees Stock Option Scheme (ESOS) to its employees. Under this scheme, the managerial employees weregranted 14.79 lakhs options and each option is entitled to one equity share of Rs.10/- each fully paidup at a price of Rs.50/- per share including premium of Rs.40/- pershare. The options vested with employees in two equal instalments to be exercised on or before December 1, 2008 and December 1, 2009. Consequent to this,719,000 shares and 700,000 shares were allotted out of the 1st and 2nd instalments respectively.

10. During the year 2007-08, the company allotted 400,00,000 Equity shares of Rs.10/- each fully paid up, to the shareholders of erstwhile Visaka Cement Industry Limited(VCIL) pursuant to the Order dated 25th July, 2007 of the Honourable High Court of Judicature at Madras sanctioning the Scheme of Amalgamation of VCIL with TheIndia Cements Limited.

11. During the year 2007-08, the company allotted 207,89,000 Equity Shares of Rs.10/- each fully paid up, to Qualified Institutional Buyers at a price ofRs.285/- per share including premium of Rs. 275/- per share.

12. During the year 2009-10, 3000 options were granted under ESOS 2006. The options will vest in two equal instalments to be exercised on or before September 1, 2011and September 1, 2012.

13. During the year 2009-10, the company allotted 245,94,000 Equity shares of Rs. 10/- each fully paid, to Qualified Institutional Buyers at a price ofRs.120.20 per share including premium of Rs.110.20 per share and 149750 equity shares of Rs.10/- each fully paid, to the eligible employees at a price ofRs.50/- per share including premium of Rs.40/- per share under ESOS 2006.

14. No interest has been recognised as income from April 2002 on calls in arrears.

SCHEDULES ANNEXED TO AND FORMING PART OF THE BALANCE SHEET ANDTHE PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31st MARCH 2010

49

SCHEDULE 2

RESERVES AND SURPLUS2009 Additions Withdrawals 2010

Rs.Lakhs Rs.Lakhs Rs.Lakhs Rs.LakhsCapital Reserve 16.17 0.00 0.00 16.17Capital Redemption Reserve 2500.00 0.00 0.00 2500.00Debenture Redemption Reserve 1066.21 0.00 533.54 532.67Securities Premium *1 139571.07 27217.87 1327.96 165460.98Contingency Reserve *2 10865.87 5533.54 0.00 16399.41General Reserve 27343.10 7000.00 0.00 34343.10Deferred Income 4389.13 0.00 298.80 4090.33Revaluation Reserve *3 66592.81 0.00 5836.90 60755.91Stock Options Outstanding account *4 120.52 0.00 55.33 65.19Shipping Tonnage Tax Reserve *5 90.00 0.00 0.00 90.00Profit and Loss account 82341.05 16270.14 0.00 98611.19

334895.93 56021.55 8052.53 382864.95Notes:*1 Securities Premium :

(a) During the year 2009-10, the company allotted 245,94,000 Equity shares of Rs. 10/- each fully paid, to Qualified Institutional Buyers at a price ofRs. 120.20 per share including premium of Rs. 110.20 per share.

(b) During the year, the company allotted 149,750 fully paid up equity shares out of the options vested in the 2nd instalment, under ESOS 2006, to theemployees. Additions to Securities Premium include premium of Rs. 40/- per share of the said equity shares allotted to employees and fringe benefitthereon of Rs. 36.95 per share aggregating to Rs. 115.23 lakhs.

(c) Withdrawals of Rs. 1327.96 Lakhs represent Share issue expenses.(d) Share Premium is net of Calls in arrears of Rs. 0.17 lakhs (As on 31st March 2009: Rs. 0.22 lakhs).

*2 Contingency Reserve:For any possible erosion in the value of Investments / Advances / other contingencies.

*3 Revaluation Reserve:Amounts withdrawn include revaluation reserve on assets retired / sold.

*4 Stock Options Outstanding Account:Out of the 2nd instalment of 739,500 options vested with the employees as on December 01, 2008, the employees exercised their options for 700,000 shares(as at 31st March 2009; 550,250 shares). The Fringe benefit, of Rs. 36.95 per share, being the difference between the market value and the option exerciseprice of the unexercised options, is shown as Stock options outstanding account. The Fringe benefit of Rs.246.80 per share on the unexercised options of the1st instalment aggregating to 20,500 options is also included in this account.

*5 Shipping Tonnage Tax Reserve:During the financial year 2007-08, the company opted for “Tonnage Tax” Scheme on the income generated by the ships and as required by Section 115VTof Income Tax Act, “Tonnage Tax Reserve” has been created. In view of the company opting out of the scheme from the financial year 2008-09, no furtherReserve has been created.

SCHEDULE 3 2010 2009SECURED LOANS Rs.Lakhs Rs.LakhsA . DEBENTURES : (Note No. 20)

Secured privately placed Debentures, redeemable / repayable on or before 31st March, 2016restructured as per the Corporate Debt Restructuring (CDR) proposal agreed to by the lenders:(i) 2385 Debentures of Rs. 500,000/- each 442.61 476.18(ii) 7630 Debentures of Rs. 500,000/- each 1687.79 1815.36

TOTAL (i) and (ii) 2130.40 2291.54Interest Accrued and due 0.27 0.00TOTAL 2130.67 2291.54

50

B. TERM LOANS:(i) Dalavoi Cement Plant :

Industrial Development Bank of India Ltd. 6242.61 6076.50(ii) Yerraguntla Cement Plant :

Industrial Development Bank of India Ltd. 2740.54 1889.41(iii) Vishnupuram Cement Plant :

a. Industrial Development Bank of India Ltd. 328.72 352.27b. IFCI Limited 107.36 121.71

436.08 473.98Other Term Loans :

(iv) State Bank of India 2787.99 3012.67(v) Allahabad Bank 0.00 309.86(vi) Housing Urban Development Corporation Ltd. 0.00 22599.66(vii) IDBI Bank Ltd. 13056.25 16389.25(viii) Punjab National Bank 22965.31 4097.15(ix) Indian Bank 0.00 340.00(x) Housing Development Finance Corporation Ltd. 6666.67 10000.00(xi) Housing Development Finance Corporation Ltd. 0.00 37.12(xii) Housing Development Finance Corporation Ltd. 7500.00 0.00(xiii) HDFC Bank Ltd. 0.00 6000.00(xiv) Kotak Mahindra Bank 6000.00 0.00(xv) Foreign Currency loan from AXIS Bank Ltd. 8982.00 0.00

67958.22 62785.71(xvi) Tandur Cement Plant :

a. Industrial Development Bank of India Ltd. 474.82 1852.41b. IFCI Ltd. 0.00 690.90c. Life Insurance Corporation of India 49.21 173.72d. Rupee Tied loans 0.00 154.45e. Indian Bank 1081.18 2702.43

1605.21 5573.91

(xvii) Liability towards assets acquired on Financial lease 0.00 11.16

TOTAL B (i) to (xvii) 78982.66 76810.67Interest Accrued and due 22.99 0.00

TOTAL 79005.65 76810.67

C. Cash Credit facilities and other Working Capital Loans from Scheduled Banks

(i) Working Capital Term Loans from Banks 984.84 1225.83

(ii) Cash Credit facilities from Scheduled Banks 4543.20 23296.95

TOTAL (i) and (ii) 5528.04 24522.78

TOTAL (A to C) 86664.36 103624.99

SCHEDULE 3SECURED LOANS (Contd.) 2010 2009

Rs. Lakhs Rs. Lakhs

51

Security:

A. Debentures:1 Item (i) is secured by a registered first mortgage on the Company’s properties in the State of Gujarat and further secured by a

joint first equitable mortgage/ charge on the immovable and movable assets (excluding assets purchased under Asset CreditScheme and certain other assets specifically excluded from the purview of the security) present and future subject to priorcharge on the movable assets in favour of the Company’s bankers for working capital requirements.

2 Item (ii) is secured by a registered first mortgage on the company’s properties in the state of Gujarat and further secured by ajoint first equitable mortgage on the immovable properties of the company both present and future.

B. Term Loans:1 Items (i) and (ii) are secured by first equitable mortgage and charge on pari passu basis (with other Lenders/Debenture Trustees)

on the immovable and movable assets (with exclusion of assets purchased under Asset Credit Scheme and certain other assetsspecifically excluded from the purview of the security) both present and future subject to prior charge on the movable assets infavour of the Company’s bankers for working capital requirements.

2 Items (iii)(a) and (vii) are secured by a joint first equitable mortgage/charge on the immovable and movable assets (excludingassets purchased under Asset Credit Scheme and certain other assets specifically excluded from the purview of the security)present and future subject to prior charge on the movable assets in favour of the Company’s bankers for working capitalrequirements.

3 Item (iii)(b) is secured by an exclusive first charge by way of hypothecation of the equipment purchased together with tools &accessories at Vishnupuram cement plant and further secured by a joint first equitable mortgage/charge on the immovable andmovable assets (excluding assets purchased under Asset Credit Scheme and certain other assets specifically excluded fromthe purview of the security) present and future subject to prior charge on the movable assets in favour of the company’s bankersfor working capital requirements.

4 Item (iv) is secured by hypothecation of Fixed Assets of the company at Sankarnagar, Dalavoi and Yerraguntla cement plantsand further secured by a joint first equitable mortgage / charge on the immovable and movable assets (excluding assetspurchased under Asset Credit Scheme and certain other assets specifically excluded from the purview of the security) presentand future subject to prior charge on the movable assets in favour of the Company’s bankers for working capital requirements.

5 Item (viii) is secured by a first pari passu charge (with other lenders/debenture trustees) on the movable and immovable fixedassets of the Company both present and future save and except book debts and subject to prior charges created / to be createdin favour of the Company’s bankers on its current assets for securing the borrowings for working capital requirements.

6 Item (x) is secured by an equitable mortgage on the immovable property at Boat Club Road, Chennai and by a lien on the fixeddeposit held with the bank.

7 Item (xii) is secured by a first pari passu mortgage and charge on the movable and immovable properties and second pari passucharge on the current assets of the Company’s Cement manufacturing facilities.

8 Item (xiv) is secured by way of exclusive charge on the immovable properties being the land and building situated at 93,Santhome High Road, Chennai.

9 Item (xv) is secured by a pari passu charge on all the movable assets of the Company excluding the current assets and movableassets at chennai and Parli grinding units excluding current assets.

10 Item (xvi) is secured by first mortgage/charge on a pari passu basis on the immovable and movable assets of Tandur Cementplant, subject to prior charge on the movable assets in favour of banks for working capital requirements.

11 Satisfaction of charge is to be filed in the case of certain loans that have been paid during the year.12 The term loan from State Bank of India is additionally secured by a second charge on the current assets of the company.

C. Cash Credit facilities and Working capital loans from Scheduled Banks :The fund based and non-fund based working capital facilities are secured by a first charge on pari passu basis on all the currentassets and second charge on the movable fixed assets and immovable properties of the company. The working capital term loansare secured by a first charge on pari passu basis on the movable fixed assets and immovable properties of the company and asecond charge on the current assets.

D. Loans mentioned in B(i) carry an option for conversion into equity shares at par not exceeding 20% of the sanctioned loan/outstanding loan in the advent of certain events and subject to conditions.

SCHEDULE 3SECURED LOANS (Contd.)

52

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4302

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2010 2009No. of Shares/ Face Value (Rupees) Cost Cost

Debentures Per share Total Rupees Rupees1. TRADE INVESTMENTS - Long Term (Unquoted):

Fully paid Equity Shares:1. Coromandel Electric Company Limited 140000 10 1400000 1400000 1400000

Preference shares of Coromandel Electric Company Limited (CECL)2. 13.25% Cumulative Redeemable Participating Preference shares 508 10000 5080000 5093268 50932683. 18% Cumulative Redeemable Participating Preference shares 11600 10000 116000000 141817383 141817383

(5,000 shares have been given as security towards a loan obtained by CECL)4. 14% Cumulative Redeemable Preference shares 4000000 10 40000000 45508197 45508197

193818848 1938188482. NON-TRADE INVESTMENTS: (Long Term)

A. Fully paid Equity Shares of Companies (Quoted):5. Karur KCP Packagings Ltd. 996500 10 9965000 39860000 39860000

B. Shares of Companies - Long Term (Unquoted):i. Subsidiaries:

Fully paid Preference Shares:6. Industrial Chemicals & Monomers Limited 5000 100 500000 20000 20000

Fully paid Equity Shares:7. Industrial Chemicals & Monomers Limited 2196691 10 21966910 3558082 35580828. ICL Financial Services Limited 50000 10 500000 500000 5000009. ICL Securities Limited 50000 10 500000 500000 50000010. ICL International Limited 50000 10 500000 500000 50000011. PT. Coromandel Minerals Resources, Indonesia 2940 4284 12593982 12593982 12593982

(Paid up per share: Indonesian Rupiah 942700)Subsidiaries - Total 17672064 17672064

ii. Other than Subsidiaries:Fully paid Equity Shares:

12. Coromandel Sugars Limited 100 10 1000 1000 100013. Andhra Pradesh Gas Power Corporation Limited 5896000 10 58960000 483100750 48310075014. Raasi Cement Limited (net of provision: Rs. 74,41,684) 79530 10 795300 0 015. Jagati Publications Private Limited 1111110 10 11111100 400000000 350000000

(138,888 shares were purchased during the year)16. Carmel Asia Holdings Private Limited 190839 10 1908390 50000000 5000000017. Coromandel Travels Limited 200000 10 2000000 2000000 200000018. Bharathi Cement Corporation Limited (Formerly known as

Raghuram Cements Limited) (344826 Preference shares 1803973 10 18039730 953263150 453263150purchased during the year) (Preference shares were converted intoEquity shares during the year @ 1:1)Other than Subsidiaries - Total 1888364900 1338364900Total B (i) and (ii) 1906036964 1356036964

C. Government and Trustee Securities:1. National Savings Certificates 120200 120200 1202002. Indira Vikas Patra Certificates 2100 2100 2100

122300 122300D. Other Investments (Quoted):

1. Floating rate Fund of Unit Trust of India (Purchased during the year)(Net Asset Value as on 31.03.2010: Rs. 50,06,88,807) 499615 1000 499614947 500000000 0

2. Treasury Advantage Fund of Unit Trust of India (Purchased during thethe year) (Net Asset Value as on 31.03.2010: Rs. 50,07,02,939) 42092148 10 420921481 500000000 0

1000000000 0

E. Fully paid shares of Co-operative Societies - Long Term (Unquoted)1. The India Cements Employees Co-operative Stores Ltd, Sankarnagar 2500 50 125000 125000 1250002. The India Cements Employees Co-operative Stores Ltd, Sankari West 5000 10 50000 50000 500003. The India Cements Mines Employees Co-operative Stores Ltd, Sankari West 5300 10 53000 53000 53000

228000 228000Grand Total (1+2) 3140066112 1590066112Less: Provision for diminution in value of Investments 332762 332762

3139733350 1589733350Note: Aggregate of Quoted investments:

Cost 1039982300 39982300Market Value 1042971800 21447400

Aggregate of Unquoted Investments:Cost 2100083812 1550083812

SCHEDULE 6INVESTMENTS

54

SCHEDULE 7CURRENT ASSETS, LOANS AND ADVANCES

2010 2009Rs. Lakhs Rs. Lakhs

A. CURRENT ASSETS :

1. Inventories:Stores / Spares (including coal and packing material) 28959.68 22484.25Raw Materials 4905.16 5178.26Work-in-Process 560.84 849.35Semi-finished Goods 7855.52 5910.15Finished Goods 2495.33 2627.83

44776.53 37049.84

2. Real Estate - Projects in progress 2042.47 2042.47

3. Sundry DebtorsOutstanding for more than six months(Net of bad debts written off Rs. 43.56 lakhs.(Financial year 2008-09: Rs. 86.33 lakhs)) 3883.82 2438.15

Less: Provision for doubtful debts (763.60) (510.42)

Sub total 3120.22 1927.73

Others 45405.66 33470.08

Total - Sundry Debtors, considered good 48525.88 35397.81(Secured by Trade deposits aggregating to Rs. 29960.07 lakhs.(As at 31st March 2009: Rs. 23176.72 lakhs))

4. Cash, Stamps and Bank Balances:

Cash, Cheques and Stamps on hand 145.39 65.13

Cash at Scheduled Banks in Current Accounts 117.06 474.69

Fixed Deposits with Scheduled Banks 5118.89 7979.925381.34 8519.74

B. LOANS AND ADVANCES:

1. Secured:

Housing and other Loans to employees including interest accrued 565.54 572.56

2. Unsecured (Considered good):

Advance for Goods 4897.17 4765.05

Other Advances recoverable in cash or in kind or for value to be received 166333.91 98552.23(Note No. 5) (including advances to Subsidiaries Rs. 83372.12 lakhs;As at 31st March 2009: Rs. 33661 lakhs)

Prepaid Expenses 1533.55 539.26

Deposits with a Financial Institution 8235.42 22643.26

Other Deposits 5353.02 4270.61

186918.61 131342.97

T O T A L A & B 287644.83 214352.83

55

SCHEDULE 8CURRENT LIABILITIES AND PROVISIONS

2010 2009Rs. Lakhs Rs. Lakhs Rs. Lakhs Rs. Lakhs

CURRENT LIABILITIES :Creditors for Goods including Letters of credit 17160.09 18324.65Creditors for Expenses (including liability as per Accounting Standard 15) 28480.19 19669.20Creditors for Capital Expenditure (Note No. 22) 27316.60 36460.57Other Liabilities 8295.16 6189.91Trade Deposits from customers 29960.07 23176.72Interest accrued not due 1450.42 506.69Customers’ Credit Balances 3757.20 2466.54

PROVISIONS :Provision for income tax (net) 3826.67 1928.72Proposed dividend including tax 7163.95 6608.62

127410.35 115331.62Investor Education and Protection Fund:*(Appropriate amount shall be transferred to “Investor Education andProtection Fund”, if and when due)

(a) Unpaid Dividend 41.48 25.29(b) Unpaid Share Application Money 0.00 0.00(c) Unpaid Matured Deposits 41.11 37.81(d) Unpaid Matured Debentures 0.00 0.00(e) Interest accrued on (a) to (d) above 0.00 0.00

82.59 63.10* All the above items are included in Schedule 8 “Current Liabilities”

except unpaid matured Debentures and interest accrued which areincluded in Schedule 3 “Secured Loans” (Note No. 20)

SCHEDULE 9SALES AND OTHER INCOMESales including Excise Duty 403570.89 375838.53Freight Earnings - Shipping 5189.51 7092.45Value of Power Generated from Wind Farms 1309.88 981.32

410070.28 383912.30DIVIDEND AND INTEREST:

On Trade Investments 272.79 282.76On Other Investments 8.56 13.98Others (Tax deducted at source Rs. 102.99 lakhs 1687.50 4135.06Previous Year: Rs. 70.18 lakhs)

1968.85 4431.80Rent Recovery 23.16 19.77Profit on Sale of Assets 20.82 21.79Profit on Sale of Investments 0.00 0.60Foreign Exchange translation difference 1380.81 12.58Miscellaneous Income (Note No. 22) 8705.28 7054.71Total Other Income 12098.92 11541.25

422169.20 395453.55

56

SCHEDULE 10MANUFACTURING AND OTHER OPERATING EXPENSES

2010 2009Rs. Lakhs Rs. Lakhs Rs. Lakhs Rs. Lakhs

1. Raw Materials Consumed

Opening Stock 5178.26 4894.53

Add: Purchases 33129.32 24247.78

Own Quarrying (Net) (Note No.7.a) 16111.77 13029.81

49241.09 37277.59

54419.35 42172.12

Less : Closing Stock 4905.16 5178.26

Raw Materials Consumed 49514.19 36993.86

2. Stores Consumed (Note No.7.b) 4547.75 3644.09

3. Power and Fuel 99985.28 89160.21

4. Repairs & Maintenance:

Buildings 49.54 48.91

Machinery 4717.88 4998.88

Others 4794.69 5726.61

Total Repairs & Maintenance 9562.11 10774.40

5. Agency and Port Charges - Shipping 349.55 536.84

6. Excise Duty on stock adjustment 20.80 115.11

163979.68 141224.51

SCHEDULE 11

SALARIES, WAGES AND AMENITIES

Salaries, Wages and Bonus 17765.72 15144.68

Contribution to Provident Fund 730.63 582.67

Gratuity 600.49 572.52

Superannuation 1084.18 537.60

Employees’ Provident Fund Admn Charges 51.05 42.63

Employees’ State Insurance Scheme 12.55 16.46

Workmen and Staff Welfare Expenses* 3276.67 2426.80

Unavailed leave (Note No. 29) 1476.00 235.01

Perquisite value of Employees’ Stock Options 0.00 273.25

24997.29 19831.62

* Includes Expenses on Schools Rs.197.19 Lakhs (Previousyear Rs. 177.22 Lakhs) which is net of Grants Rs.324.76Lakhs (Previous year Rs.229.49 Lakhs).

57

SCHEDULE 12ADMINISTRATION AND OTHER CHARGES 2010 2009

Rs. Lakhs Rs. Lakhs Rs. Lakhs Rs. Lakhs

Insurance 609.69 569.72Rent 308.02 481.39Rates and Taxes 500.75 387.80Printing and Stationery 183.88 173.66Postage, Telephones and Telegrams 342.72 363.75Other Administration Expenses 12344.52 8996.00Legal Fees 145.40 111.36Directors’ Sitting Fees 19.90 16.50Auditors’ Expenses:

Audit Fees 80.00 60.00Cost Audit Fees 10.00 7.00Certifications/Others 16.72 25.73Tax Audit/Other Services 16.50 10.56Travel/out of pocket expenses 5.16 5.67

128.38 108.96Amortisation of Deferred Revenue Expenses 1374.02 1024.33Loss on Sale of Assets 121.65 66.90Provision for Doubtful Advances / Debtors 296.74 504.65

Provision for Doubtful Advances / Debtors - Opening balance 730.42 340.85Add: Additional provisions during the year 296.74 504.65

1027.16 845.50Less: Bad debts / advances written off during the year 43.56 115.08Provision for Doubtful Advances / Debtors - Closing balance 983.60 730.42

16375.67 12805.02SCHEDULE 13INTEREST AND OTHER CHARGES (NET)Interest on Debentures 323.74 374.16Interest on Fixed Loans 12741.62 8996.81Interest - Others 427.37 1092.21Bank Charges 771.24 751.75

14263.97 11214.93SCHEDULE 14DIRECTORS’ REMUNERATIONManaging Director: Salary 360.00 360.00

HRA 108.00 108.00Contribution to Provident Fund 43.20 43.20Contribution to Gratuity and Superannuation Funds 69.00 69.00Commission 1011.00 844.00Others 2.64 1593.84 3.41 1427.61

Wholetime Director: Salary 8.71 0.00(Part of the year) HRA 2.61 0.00

Contribution to Provident Fund 1.05 0.00Contribution to Gratuity and Superannuation Funds 1.72 0.00Commission 0.00 0.00Others 0.00 14.09 0.00 0.00

Executive Director: Salary 105.60 288.00(Part of the year) HRA 31.68 86.40

Contribution to Provident Fund 12.67 34.56Contribution to Gratuity and Superannuation Funds 18.40 55.20Commission 0.00 422.00Unavailed leave and Gratuity in excess of Rs. 3.50 lakhs 662.59 0.00Others 244.64 1075.58 2.24 888.40

2683.51 2316.01The appointment and remuneration of Rs. 14.09 lakhs to the wholetime director for the period from 5th March 2010 to 31st March 2010 require the approval ofthe shareholders and financial institution.

58

Profit before taxes 53132.09 64830.40Add: Managerial Remuneration 2683.51 2316.01Add: Loss on sale of assets 121.65 66.90Add: Provision for doubtful debts 296.74 504.65Less: Bad debts written off (43.56) (115.08)Less: Profit on sale of assets/investments (20.82) (22.39)

Net profit as per Section 309(5) of the Companies Act 56169.61 67580.49

Commission:Managing Director 1011.00 844.00Executive Director 0.00 422.00

Total 1011.00 1266.00

SCHEDULE 15

DONATIONS

The India Cements Educational Society 100.22 117.43Rajasthan Chief Minister’s Relief Fund 0.00 50.00Flood Relief victims of Andhra Pradesh & Karnataka 65.00 0.00Great Lakes Institute of Management 200.00 0.00Others 233.65 148.65

598.87 316.08

SCHEDULE 16(INCREASE) / DECREASE IN STOCK

Opening Stock of:Work-in-Process 849.35 669.43Semi-finished Goods 5910.15 4761.18Finished Goods 2627.83 2615.99Real Estate - Projects in Progress 2042.47 2042.47

11429.80 10089.07

Less:Closing Stock of:Work-in-Process 560.84 849.35Semi-finished Goods 7855.52 5910.15Finished Goods 2495.33 2627.83Real Estate - Projects in Progress 2042.47 2042.47

12954.16 11429.80

Total (Increase)/Decrease in Stock (1524.36) (1340.73)

SCHEDULE 14 (Contd.)Computation of Net Profit under Section 309(5) of the Companies Act, 1956

2010 2009Rs. Lakhs Rs. Lakhs Rs. Lakhs Rs. Lakhs

59

SCHEDULE 17(A) SIGNIFICANT ITEMS OF ACCOUNTING POLICY

1. The financial statements have been prepared in accordance with Indian Generally Accepted Accounting Principles (GAAP), generally underthe historical cost convention on accrual basis and exceptions to this basis, if any, are herein specifically mentioned. GAAP comprisesmandatory Accounting Standards issued by the Institute of Chartered Accountants of India (ICAI), the provisions of the Indian Companies Act,1956 and the Guidelines issued by ICAI and Securities and Exchange Board of India (SEBI).

2. Fixed Assets are valued and shown adopting the following basis:(a) Fixed assets and Capital work-in-progress of all the cement manufacturing facilities are shown at revalued amounts as at 31st March 2004.

All other Fixed assets acquired are shown at the cost of acquisition. All costs including financing costs and applicable overheads incurredon specific projects/acquisition of undertakings are also capitalised.

(b) Fixed assets acquired on hire purchase or on Financial Lease are shown at their principal cost, excluding the interest cost included in theseagreements which is charged to revenue over the tenure of the agreement.

(c) Expenditures and outlays of money on uncompleted projects of a capital nature are shown as capital works-in-progress until such timethese projects are completed and commissioned.

(d) (i) The company provides depreciation on written down value method for Motor Vehicles and for assets acquired prior to 1-4-1982 atHead Office and at Sankarnagar.

(ii) Software development costs and Computers are depreciated on Straight Line method as per Section 205(2)(b) of the Companies Act,1956.

(iii) Ships are depreciated on Straight Line method, over its estimated useful life.(iv) Long term Franchisee Rights are capitalised and amortised over the initial period of ten years.(v) For all other assets Straight Line method as per Section 205(2)(b) of the Companies Act, 1956 is adopted.(vi) The depreciation on incremental value arising from the revaluation of fixed assets is charged to the Revaluation Reserve Account.(vii) Fixed assets are tested for impairment and impairment loss, if any, is provided by a charge to the Profit and Loss Account.

3. (a) Where Foreign Currency loans have been availed to acquire fixed assets from outside India, the outstanding liability on these loans isstated at the exchange rate of the rupee as at the year end or at contracted rates with a corresponding adjustment to the carrying cost ofthe relevant assets. Depreciation is charged to accounts on the values so adjusted over the remaining life of the asset.

(b) Foreign Exchange transactions are accounted at the exchange rates prevailing at the time of transactions or at contracted rates. CurrentAssets and all Liabilities, (other than for acquiring fixed assets as mentioned in 3(a) above), in Foreign currencies are translated at valuesprevailing as at the year end. Gains/Losses if any, arising therefrom are recognised in the Profit and Loss Account.

4. (a) Sales include excise duty, revenue from trade related activities and sales tax deferred as reduced by consideration for assignment of SalesTax deferral liability and is net of rebates, discounts and incentives.

(b) Revenue from construction projects under Real Estate and Property Development Division is recognised on percentage of completionmethod.

(c) Revenue on time charter of ships is recognized on a proportionate basis.5. Valuation of inventories of raw materials, packing materials, stores, spares, fuels and work-in-process is at weighted average cost. Semi-

finished goods, finished goods and Real Estate Projects are valued at cost or net realisable value whichever is lower. The value of finishedgoods includes excise duty.

6. Research and Development expenses not resulting in any property/equipment are charged to revenue under nominal heads.7. Interest and other costs in connection with borrowing of funds to the extent related/attributed to the acquisition/construction of qualifying fixed

assets are capitalised upto the date when such assets are ready for its intended use.8. Claims / Incomes arising from price escalation and/or any other item of compensation and which are indeterminate are accounted on

finalization.9. Trade investments and investments in subsidiary companies are long term investments and are carried at cost. The other investments are

carried at lower of cost or realisable value. Provision for diminution value is made wherever necessary in accordance with the AccountingStandard.

10. Retirement benefits are provided by charge to revenue including provision for gratuity and superannuation fund determined on an actuarialbasis for which a trust has been created. The Actuarial gains / losses arising on retirement benefits are also recognised in the Profit and Lossaccount. Unavailed leave balances are accounted based on actuarial principles.

11. Fringe Benefits arising on options vested under Employees Stock Options Scheme (ESOS), 2006 are charged to Profit and Loss Account andcredited to Stock Options Reserve Account. On allotment of shares, corresponding amount is transferred from Stock Options Reserve Accountto Securities Premium Account.

12. Premium on redemption of Debentures / Bonds is accounted on redemption and set off against the Securities Premium Account.

60

2010 2009Rs. Lakhs Rs. Lakhs

1 Estimated amounts of Capital Expenditure Commitments 21669.22 8766.98

2 Monies for which the company is contingently Liable:a) Letter of Credit Opened By Bankers 9032.34 5703.95b) Counter Guarantees to Bankers 41969.20 10356.19

(including guarantees given on behalf of Subsidiaries and Associates)c) Sales Tax demand for various years under dispute 1389.87 795.94d) Contingent Liability pertaining to Raasi Cement Limited

(Residuary Company) for Sales Tax, Central Excise and Income Tax 2295.56 2247.49e) Sales Tax Deferred under a scheme of the Governments of Tamil Nadu and Andhra

Pradesh have been assigned to other companies. In view of the assignment theCompany is contingently liable. 3519.93 3519.93The Sales tax Department issued notices on the company claiming a sum ofRs. 5873 Lakhs stated to have been availed in excess by the company. The Companyhas deposited a sum of Rs.16 Crores included under Loans and Advances. The issuewas challenged by the company before the High Court and the High Court in December2006 allowed the writ petition in favour of the Company. The department has howevergone on appeal to the Supreme Court.

f) Contingent Liability on account of CENVAT cases and others 12905.04 4258.22

3 Claims against the Company not acknowledged as debts 11423.88 11950.154 Building includes purchase of flats on leasehold lands for which the documents of the title

are yet to be executed in favour of the company. 11.13 11.135 Loans and Advances :

a) Advances include advances to Subsidiaries, Associates and others representingstrategic investments in Cement, Sugar, Shipping and Financial Services whichrepresent strategic long term investments, which in the opinion of management, willrealise values stated in the long term. The Company, as a prudent measure hascreated a Contingency Reserve to the extent of Rs.108.66 Crores for any possibleerosion in the value of the said advances. 93590.20 83362.54

b) Advances include advances to Indo Zinc Limited, a step down subsidiary which is setting up acement plant in Rajasthan with an annual capacity of 1.5 million tonnes. The plant is expected tocommence commercial production during the second quarter of the financial year 2010-11. 49360.87 0.00

c) Advances include Disputed Cenvat / Sales Tax Claims pending in different stages ofappeal. Management is of the opinion that these are recoverable at values stated. 632.74 882.22

6 Deferred Revenue expenditure includes expenses incurred on voluntary retirementschemes, which will be written off over a period of 60 months commencing from the yearfollowing the year in which the expenditure was incurred or upto financial year ending31st March 2010, whichever is earlier. 0.00 1355.12

7 (a) Raw Materials consumed:Own Quarrying includes:(i) Salaries & Wages 1285.34 1204.39(ii) Stores Consumed 2679.87 2654.63(iii) Royalty 6595.54 4235.65

(b) Total Consumption of Stores and Spares during the year, including used in ownquarrying; Captive Power generation and Repairs & Maintenance 17818.45 18469.00

8 Repairs and maintenance includes Stores & Spares 5457.34 6020.60

SCHEDULE 17

(B) NOTES ON ACCOUNTS FOR THE YEAR ENDED 31ST MARCH, 2010

61

SCHEDULE 17NOTES ON ACCOUNTS (Contd.)

2010 2009Rs. Lakhs Rs. Lakhs

9 Selling and Distribution expenses include(i) Packing Charges 15490.51 14002.76(ii) Additional Sales Tax 39.82 14.42(iii) Freight outwards 59110.02 44591.75(iv) Advertisement 3016.17 1784.23

10 Detailed quantitative information of goods manufactured during the Report Period.(a) Installed capacity (Tonnes) 14050000 12950000(b) Production (Tonnes) 10493568 9111354(c ) Sales – Cement (Tonnes) 10501271 9117811

Clinker (Tonnes) 462827 1698Sales – Cement (Gross) (Rs. Lakhs) 392002.08 375795.64

Clinker (Rs. Lakhs) 11568.81 42.89403570.89 375838.53

(d) Opening Stock of cement produced (Tonnes) 106136 112593Value (Rs. Lakhs) 2627.83 2615.99

(e) Closing stock of cement produced (Tonnes) 98433 106136Value (Rs. Lakhs) 2475.50 2627.83

11 Value of imports on CIF basis(a) Raw Materials 2236.63 2800.45(b) Fuel 37524.11 20701.73(c) Spare Parts and Components 3304.35 1367.31(d) Capital goods 997.17 1759.82

12 Earnings in Foreign Exchange (on accrual basis):Export (FOB)Cement – Quantity (Tonnes) 4517 0

– Value (Rs. Lakhs) 127.72 0.00

13 Expenditure in Foreign Currency (on accrual basis):Legal & Consultancy Charges 75.93 98.51Travel Expenses and Others 274.24 246.46Indian Premier League - payments to foreign players/others 2305.58 1011.59

14 Remittances in Foreign Currency:Final Dividend on account of GDS

No. of shareholders 1 1Amount remitted (Rs. Lakhs) 56.88 141.16Year to which it pertains 2009 2008

Final Dividend on account of GDRNo. of shareholders 1 1Amount remitted (Rs. Lakhs) 4.15 2.06Year to which it pertains 2009 2008

62

2010 2009Rs. Lakhs Rs. Lakhs

15 Details of imported and indigenous materials consumed during the year:Raw materials:

Imported 3446.53 3708.21Indigenous 46067.66 33285.65Total 49514.19 36993.86

Percentage to Total ConsumptionRaw materials:

Imported 6.96% 10.02%Indigenous 93.04% 89.98%Total 100.00% 100.00%

Spare Parts and Components:Imported 739.91 1324.96Indigenous 1370.08 536.54Total 2109.99 1861.50

Percentage to Total ConsumptionSpare Parts and Components:

Imported 35.07% 71.18%Indigenous 64.93% 28.82%Total 100.00% 100.00%

16 Details of Raw Materials consumed:Quantity in Tonnes:-Limestone 12362748 9999523Gypsum 520646 508728Others 2400647 1981395

Value (Rs. Lakhs) :-Limestone 22125.78 18738.71Gypsum 6436.92 6289.07Others 13287.50 10258.43Freight on Inter Unit Transfer of Clinker 7663.99 1707.65

Total 49514.19 36993.86

17 The company had opted for the "Tonnage Tax Scheme" under the Income Tax Act, 1961 in the financial year 2007-08 andhas opted out of the said scheme with effect from the financial year 2008-09.

18 There are no dues to Small Scale Industries which is outstanding for more than 30 days at the Balance Sheet Date computedon unit wise basis. The above information regarding Small Scale undertaking has been determined to the extent such partieshave been identified on the basis of information available with the Company and has been relied upon by the auditors.

19 There are no dues to Micro, Small and Medium Enterprises which are outstanding as at the Balance Sheet date and therewere no delays as per the provisions of the Micro, Small and Medium Enterprises Development Act, 2006 in payment ofdues to such enterprises. The above information regarding Micro, Small and Medium Enterprises has been determined tothe extent such parties have been identified on the basis of information available with the Company and has been reliedupon by the auditors.

SCHEDULE 17NOTES ON ACCOUNTS (Contd.)

63

20 Note on Debt Restructuring:[a] The Corporate Debt Restructuring (CDR) Cell formed by the Reserve Bank of India approved a Debt Restructuring

proposal for all debts other than public deposits with effect from 01-01-2003.[b] The common documentation for creation of security between all the lenders and the company is yet to be executed.

Pending execution of common documentation between the lenders and the Company, the security clause under theloans have not been changed.

21 The company had issued USD 75 Million Zero Coupon Foreign Currency Convertible Bonds [FCCB] which matures onMay 12, 2011. The bonds will not bear any interest and are convertible by holders into shares, subject to certain conditions.The net proceeds were used by the company for the purpose of Capital Expenditure and other purposes, including therepayment of existing debt, as permitted under the applicable law or regulations.The conversion price will be Rs.305.57 Per Share with a fixed rate of exchange on conversion of Rs.44.77 Per USD andapproximately 10988481 Shares would be issuable on May 12, 2011, if the conversion option is exercised by the bondholders. If the bonds are not previously redeemed, converted or purchased and cancelled, the company will redeem eachbond at 147.70 Percent of its Principal Amount on the Maturity date. The amount of premium on such redemption will be tothe tune of Rs.16,062.98 Lakhs.The Company, subject to fulfillment of certain conditions and obtaining requisite approvals, has an option to redeem thebalance bonds in whole but not in part at any time on or after May 11, 2008 but not less than seven business days prior toMaturity date.

22 The Company has as part of the initiatives to promote corporate image and its brands participated in the IPL T/20 tournamentswith its team “The Chennai Super Kings”. The right to operate the franchise provides a platform to build corporate andbrand image especially in the context of the company becoming a Pan India Player.The consideration to operate the franchise, aggregating to USD 91 Million is payable over a period of 10 years in equalinstalments commencing from 2008.As per the agreement, BCCI-IPL will share its income from the sale of media rights and sponsorship income with all thefranchisees. In addition to the Central revenue as mentioned above the franchisee will also have local revenue like gatecollections, team sponsorships, uniform sponsors etc. The revenue from operating the franchise is grouped underMiscellaneous Income.The costs involved in operating the franchise like remuneration to the players, travelling and accommodation expenses,advertisements, promotions, etc. are accounted in accordance with the Generally Accepted Accounting Principles. Theexpenses are grouped under the natural heads of accounts.The company capitalized the entire franchisee fee payable to BCCI-IPL as a "Franchise Right" under intangible asset.Considering the revenue by operating the franchise and the potential cash flows arising therefrom the "Franchise Right" isbeing amortized over a period of 10 years. The amount payable to BCCI towards the same is grouped under SundryCreditors for Capital Expenditure under Current Liabilities.

23 Pending finalisation of ongoing negotiations with various Banks / Financial Institutions, the claims towards Interest / Penalinterest claims by Banks / Financial Institutions are under negotiation for waiver, amount not determinable.

24 Related Party Disclosures:A. Names of the related parties and the nature of the relationship:

(i) Subsidiary Companies:Industrial Chemicals and Monomers LimitedICL Financial Services LimitedICL Securities LimitedICL International LimitedPT. Coromandel Minerals ResourcesTrishul Concrete Products LimitedIndo Zinc Ltd.(became a subsidiary during the year 2009-10)

SCHEDULE 17NOTES ON ACCOUNTS (Contd.)

64

SCHEDULE 17NOTES ON ACCOUNTS (Contd.)

(ii) Associate Companies:Raasi Cement Ltd.Coromandel Sugars Ltd.India Cements Capital Ltd.Coromandel Travels Ltd.Coromandel Electric Company Ltd.Unique Receivable Management Private Ltd.

(iii) Key Management Personnel (KMP):Sri N.Srinivasan – Vice Chairman & Managing DirectorSri N.Ramachandran – Executive Director (upto 12.08.2009)Ms Rupa Gurunath – wholetime Director (w.e.f. 05.03.2010)

(iv) Relative of KMP, having transactions with the Company:Ms Rupa Gurunath – Director (became wholetime Director w.e.f. 05.03.2010)Mrs Chitra Srinivasan – Director (w.e.f. 05.03.2010)

B. Transactions with Subsidiary and Associate Companies:2010 2009

Rs. Lakhs Rs. LakhsSubsidiaries:-Sale of Goods 2654.98 3196.63Purchase of Shares Nil NilPurchase of Goods 40.38 190.71Purchase of Assets Nil NilRendering of Services Nil NilReceiving of Services 139.60 128.77Interest receivable on Advances 2252.72 NilGuarantees Outstanding at the year end Nil NilOutstanding balance included in current asset 83372.12 33945.58

Associates:-Sale of Goods 1.05 7.04Purchase of Shares Nil NilRendering of Services Nil NilReceiving of Services 6300.01 4790.45Interest receivable on Advances 211.88 290.29Dividend received from Associate co. 272.79 272.79Guarantees given by Associate co. on behalf of the company 32500.00 32500.00Guarantees Outstanding at the year end 6608.00 8008.00Outstanding balance included in current asset 6725.29 6488.70

C. Transactions relating to persons mentioned in A. (iii) above:Remuneration (schedule 14) 2683.51 2316.01Dividend paid during the year 6.49 5.77Total 2690.00 2321.78

D. Transactions relating to persons mentioned in A. (iv) above:Directors’ Sitting Fee 1.60 1.20Dividend paid during the year 1.57 0.73Total 3.17 1.93

65

2010 2009Rs. Lakhs Rs. Lakhs

25 Assets Purchased on Financial Lease:

Fixed Assets shown in Schedule 5 include the following assets purchased on Financial Lease:

Gross Block

Plant & Machinery 245.05 245.05

Total 245.05 245.05

Net Block

Plant & Machinery 132.27 132.27

Total 132.27 132.27

The total minimum lease amount payable in Less than 1 year 0.00 11.16

Present Value of total minimum lease amount payable within 1 year 0.00 10.94

The total Minimum lease amounts payable after 1 year but within 5 years 0.00 0.00

Present Value of minimum lease amount payable after 1 year but within 5 years 0.00 0.00

26 Details of Loans and Advances given to Subsidiaries, Associates and Others:

A. Loans and Advances to Subsidiaries:

(i) Rate of Interest

Industrial Chemicals and Monomers Limited Nil Nil

ICL Financial Services Limited Nil Nil

ICL Securities Limited Nil Nil

ICL International Limited Nil Nil

PT. Coromandel Minerals Resources Nil Nil

Trishul Concrete Products Limited Nil Nil

Indo Zinc Limited 8% Nil

(ii) Closing Balance for the Report Period:

Industrial Chemicals and Monomers LImited 1338.14 1323.69

ICL Financial Services Limited 16690.02 15742.12

ICL Securities Limited 13595.75 13905.98

ICL International Limited 2198.16 2519.22

PT. Coromandel Minerals Resources 189.18 169.98

Trishul Concrete Products Limited 0.00 0.00

Indo Zinc Limited 49360.87 0.00

Total 83372.12 33660.99

SCHEDULE 17NOTES ON ACCOUNTS (Contd.)

66

2010 2009Rs. Lakhs Rs. Lakhs

(iii) Maximum Balance for the Report Period:Industrial Chemicals and Monomers Limited 1338.14 1323.81ICL Financial Services Limited 16886.81 17255.57ICL Securities Limited 13906.23 14154.12ICL International Limited 2617.55 2519.22PT. Coromandel Minerals Resources 189.18 169.98Trishul Concrete Products Limited 341.15 284.59Indo Zinc Limited 49360.87 0.00

Total 84639.93 35707.29

B. Loans and Advances to Associates:

(i) Rate of Interest:Coromandel Sugars Ltd. 8% 9%India Cements Capital Ltd. 8% 9%Coromandel Electric Company Ltd. Nil NilCoromandel Travels Ltd. Nil NilUnique Receivable Management Private Ltd. Nil Nil

(ii) Closing Balance for the Report Period:Coromandel Sugars Ltd. 4416.70 4706.05India Cements Capital Ltd. 2107.81 1663.83Coromandel Electric Company Ltd. 47.10 7.61Coromandel Travels Ltd. 153.68 111.21Unique Receivable Management Private Ltd. 0.00 0.00

Total 6725.29 6488.70

(iii) Maximum Balance for the Report Period:Coromandel Sugars Ltd. 4416.70 4730.83India Cements Capital Ltd. 2107.81 1663.83Coromandel Electric Company Ltd. 68.71 53.59Coromandel Travels Ltd. 153.68 181.83Unique Receivable Management Private Ltd. 0.00 0.00

Total 6746.90 6630.08

Notes:-1. Loans and advances shown above to Subsidiaries, Associates and Others are repayable on demand.2. ICDs are not considered as they are repayable on demand and interest is charged at market rates.3. Loans to Employees as per Company’s policy are not considered.4. Pursuant to the scheme of amalgamation approved by the Honourable High Court of Judicature at Chennai, the company has

issued equity shares to the shareholders of Visaka Cement Industry Limited [Visaka]. As per the said order 199.54 lakh sharesof the company have been allotted in aggregate, to the subsidiaries in exchange for their shares of Visaka and the same areheld in a Trust on their behalf.

SCHEDULE 17NOTES ON ACCOUNTS (Contd.)

67

2010 2009Rs. Lakhs Rs. Lakhs

27 Deferred Taxation:

Liability on account of Depreciation (Net of Unabsorbed Depreciation) 28990.54 27406.24

Asset arising on account of other timing differences 2063.53 1845.23

Net Deferred tax liability 26927.01 25561.01

28 Computation of Earnings / (Loss) per Share (EPS)Earnings:

Earnings available to Equity Share Holders -Basic (A) 35434.09 43217.65

Income or (expenses) accounted in financial statementsattributable to potential equity shareholders

FCCB Forex Fluctuation gain credited to P&Lduring the period (4357.5 X 0.6601) (2876.39) 5242.84

Earnings-Diluted (B) 32557.70 48460.49

No. of Shares:

No. of Equity Shares 307175657 282431907

Weighted average No. of equity shares (C) 283776865 282041486

No. of Potential Equity Shares 11069481 11219231

Weighted average No. of Potential Equity Shares 11069481 11219231

Total weighted average No. of shares - Diluted (D) 294846346 293260717

EPS:

Basic (Rs.) (A/C) 12.49 15.32

Diluted (Rs.) (B/D) 11.04 15.32

SCHEDULE 17NOTES ON ACCOUNTS (Contd.)

68

SCHEDULE 17NOTES ON ACCOUNTS (Contd.)

29 Employee Benefits:

The details of parameters adopted for valuation of post-employment benefit plans and leave benefits, as per AccountingStandard 15 issued by ICAI, are as under:

(a) Contribution to Pension Funds:

The company offers pension plans for managerial Grade employees and Wholetime Directors. While some of the employees areeligible for Defined Benefit Plan of pension, others are eligible for defined Contribution Plan of Pension. The Defined Benefit Plans ofpension are managed by Life Insurance Corporation of India and the provision has been made on the basis of actuarial valuation.

The estimated aggregate value of Pension liability, discounted @8% p.a., under the Defined Benefit Plans and Defined ContributionPlans as at 31st March 2010, are Rs.4100.58 Lakhs and Rs.1032.91 Lakhs respectively, as per the details given below:

Defined Benefit Scheme:

2009-10 2008-09Rs. Lakhs Rs. Lakhs

Opening Balance as per actuarial valuation 3,772.71 3,180.55

Add: Interest income / differential interest due to changein discount rate during the year 99.87 156.22

Less: Settlements during the year 583.79 75.14

Sub total 3,288.79 3,261.63

Add: Provision created during the year 811.79 511.08

Closing Balance as per actuarial valuation 4,100.58 3,772.71Assumptions:Discount rate 8.00% 8.00%Salary escalation rate 2.00% 2.00%Average Age 48 yrs. 48 yrs.Average accrued service 14 yrs. 14 yrs.Annuity rates for pension computation Rates applicable for 15 years certain and

life thereafter, with return of corpus.

Defined Contribution Scheme:

2009-10 2008-09Rs. Lakhs Rs. Lakhs

Opening Balance as per actuarial valuation 760.52 734.42Less: Settlements during the year 0.00 97.62Sub total 760.52 636.80Add: Provision created during the year 272.39 123.72Closing Balance as per actuarial valuation 1032.91 760.52

(b) Leave of absence and encashment:The Company has different leave plans including paid leave of absence plans and encashment of leave plans foremployees at different grades and provision has been made in accordance with Acounting Standard 15. The totalamount of provision available for the unavailed leave balances as at 31st March 2010 is Rs.4583.22 Lakhs (as at 31stMarch 2009: Rs.3107.22 Lakhs).

69

(c) Gratuity:

The employees are eligible for Gratuity benefits as per the Payment of Gratuity Act, 1972. The Gratuity Scheme isgoverned by a Trust created for this purpose by the company. The amount of Contribution to be made is arrived atbased on an Actuarial valuation done at the Balance Sheet date, as given below and is accounted accordingly.

2009-10 2008-09Rs. Lakhs Rs. Lakhs

Opening Balance as per actuarial valuation 2279 1831Add: Interest income during the year 20 30Less: Settlements during the year 328 154Sub total 1971 1707Add: Provision created during the year 600 572Closing Balance as per actuarial valuation 2571 2279Assumptions:Discount rate 8.00% p.a. 8.00% p.a.Salary escalation rate 2.00% p.a. 2.00% p.a.Average age 52 years 52 years

Average accrued service 26 years 26 years

30 Note on Employees Stock Option Scheme, 2006:

During the year 2006-07, the company announced Employees Stock Option Scheme, 2006 (ESOS 2006) to its employees,which came into force on 1st December 2006. As per the scheme, the eligible employees are entitled to apply for and beallotted to one equity share of Rs.10/- each, fully paid-up, on payment of the Exercise price of Rs.50/- per Option, whichshall vest with the option holders in 2 equal instalments on 1st December 2007 and 1st December 2008. The vestedoptions shall be exercised by the option holders within 1 year from the date of vesting.

Under ESOS 2006, the maximum number of options to be granted in aggregate is not to exceed 15,00,000; of which thecompany issued 14,79,000 options, to be vested with the option holders in two equal annual instalments. Out of the optionsvested on 1st December 2007 and 1st December 2008, the option holders exercised their options for and were allotted fullypaid up equity shares aggregating to 7,19,000 (as at 31st March 2009:7,19,000 shares) and 7,00,000 (as at 31st March2009:5,50,250 shares) respectively as at the Balance sheet.

Accounting of ESOS

The fair market price per equity share of the company on the date of vesting, i.e 1st December 2007 & 1st December 2008was Rs.296.80 & Rs.86.95 respectively. On vesting, the excess of fair market price over the price paid by the employees,per scheme, is charged to Profit and Loss account by crediting Stock Options Outstanding Reserve Account and on allotmentof shares, the corresponding amount is transferred from Stock Options Outstanding Reserve Account to Securities Premium,as per the Guidance Note issued by The Institute of Chartered Accountants of India.

31 Permission for exemption from disclosure of foreign exchange earnings and expenditure with regard to shipping operationshas been received.

32 Previous year's figures have been regrouped wherever necessary.

SCHEDULE 17NOTES ON ACCOUNTS (Contd.)

70

(C) STATEMENT PURSUANT TO PART IV OF SCHEDULE VI OF THE COMPANIES ACT, 1956.BALANCE SHEET ABSTRACT AND COMPANY’S GENERAL BUSINESS PROFILE

I Registration details :

Registration No. State Code 1 8

Balance Sheet Date

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

Public Issue Rights Issue 8

Bonus Issue Private Placement 2 9 5 6 1 9 9

Employees’ Stock Options exercised 1 3 0 2 1III Position of mobilisation and deployment of funds (Amount in Rs. Thousands)

Total Liabilities Total Assets 6 5 5 8 4 5 9 8

Sources of Funds : Application of Funds :

Paid up Capital Net Fixed Assets 4 6 2 1 5 0 6 4

Reserves & Surplus Net Current Assets 1 6 0 2 3 4 4 8

Secured Loans Investments 3 1 3 9 7 3 3

Unsecured Loans Deferred Tax Assets 2 0 6 3 5 3

Deferred Tax liability Miscellaneous Expenses 0

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

Turnover Total Expenditure 3 5 6 9 3 8 1 9

Profit/Loss Before Tax Profit/Loss After Tax 3 5 4 3 4 0 9

Earnings Per Share (in Rs.) Dividend Rate % 2 0

V Generic names of the Principal Products/Services of the Company : (as per monetary terms)

Item Code No.(ITC Code) Product Description

0 0 9 3 1

N I L

N I L

3 1 0 3 1 0

6 5 5 8 4 5 9 8

3 0 7 1 7 4 5

3 8 2 8 6 4 9 5

8 6 6 6 4 3 6

1 2 6 6 0 8 6 8

2 8 9 9 0 5 4

4 1 0 0 7 0 2 8

5 3 1 3 2 0 9

1 2 . 4 9

2 5 2 3 2 9 . 0 1 C E M E N T

P R O P E R T Y D E V E L O P M E N T

P O W E R G E N E R A T I O N

F R O M W I N D F A R M S

As per our Report of 30th April, 2010Signatures to Schedules 1 to 17

For P.S.SUBRAMANIA IYER &CO., For BRAHMAYYA & CO., N.SRINIVASAN B.S.ADITYAN ARUN DATTAChartered Accountants Chartered Accountants Vice Chairman & Managing Director R.K. DAS N.R. KRISHNANG.HARIHARAN N.SRI KRISHNA V. MANICKAM A. SANKARAKRISHNANPartner Partner RUPA GURUNATH N. SRINIVASAN K. SUBRAMANIANMembership No. 15071 Membership No. 26575 Wholetime Director Directors

Place : Chennai R. SRINIVASAN G.BALAKRISHNANDate : 30th April, 2010 Joint President (Finance & Accounts) President & Company Secretary

S H I P P I N G

71

2010 2009

Rs.Lakhs Rs.Lakhs Rs.Lakhs Rs.Lakhs

A. Cash flow from operating activities :

Net profit before tax and extraordinary items 53132.09 64830.40

Adjusted for:

Depreciation 23312.06 20332.04

Provision for Doubtful Debts & Advances 296.74 504.65

Foreign Exchange -5738.31 7929.92

Profit/Loss on sale of Investments 0.00 -0.60

Profit/Loss on sale of Assets 100.83 45.11

Interest Expense 19316.94 14009.56

Interest Income -7511.71 -7681.44

Dividend Income -281.35 -296.74

Perquisite value of Employees’ stock options 0.00 273.25

Deferred revenue expenditure / income 1355.12 30850.32 1024.33 36140.08

Operating profit before Working Capital changes 83982.41 100970.48

Trade and other receivables -58772.79 -34503.07

Inventories -7726.69 -4028.79

Trade payables 17825.69 -48673.79 16476.59 -22055.27

Cash generated from operations 35308.62 78915.21

Direct Taxes -14434.05 -8301.88

Net cash from operating activities (A) 20874.57 70613.33

B. Cash flow from Investing activities :

Purchase of Fixed Assets -29625.14 -95426.26

Sale of Fixed Assets 11.23 43.19

Sale of Investments 0.00 213.72

Purchase of Investments -15500.00 -3182.21

Interest received 3068.31 4147.64

Dividend received 281.35 296.74

Refund by / advances to Subsidiaries, Associates and Others -4403.45 -274.91

Net cash from Investing activities (B) -46167.70 -94182.09

CASH FLOW STATEMENT FOR THE YEAR ENDED 31st MARCH, 2010

72

CASH FLOW STATEMENT FOR THE YEAR ENDED 31st MARCH, 2010 (Contd.)

N.SRINIVASAN B.S.ADITYANVice Chairman & Managing Director ARUN DATTA

R.K.DASN.R. KRISHNAN

RUPA GURUNATH V. MANICKAMWholetime Director A. SANKARAKRISHNAN

N. SRINIVASANPlace : Chennai R. SRINIVASAN G.BALAKRISHNAN K.SUBRAMANIANDate : 30thApril, 2010 Joint President (Finance & Accounts) President & Company Secretary Directors

C. Cash flow from financing activities :

Proceeds from issue of share capital 28308.98 281.46

Dividend paid -6608.62 -6588.61

Proceeds from long term borrowings 77118.24 26456.91

Repayment of borrowings -58334.05 -16649.39

Interest paid (net of remission) -18329.82 -13975.91

Net Cash from financing activities (C) 22154.73 -10475.54

Increase / (Decrease) in cash and cash equivalent (A+B+C) -3138.40 -34044.30

Cash and cash equivalent at the beginning of the year 8519.74 42564.04

Cash and cash equivalent at the close of the year 5381.34 8519.74

2010 2009

Rs.Lakhs Rs.Lakhs

AUDITORS’ CERTIFICATE

We have verified the above Cash Flow Statement of The India Cements Ltd., derived from the audited financial statementsfor the years ended 31st March, 2010 and 31st March, 2009 and found the same to be drawn in accordance therewith andalso with the requirements of Clause 32 of the listing agreements with Stock Exchanges.

For P.S.SUBRAMANIA IYER & CO., For BRAHMAYYA & CO.,Chartered Accountants Chartered Accountants

G.HARIHARAN N.SRI KRISHNAPartner PartnerMembership No.15071 Membership No.26575

Place : ChennaiDate : 30th April, 2010

73

STATEMENT ATTACHED TO THE BALANCE SHEET AS AT 31st MARCH, 2010 PURSUANT TO SECTION 212 OF THECOMPANIES ACT, 1956.

N.SRINIVASAN B.S.ADITYANVice Chairman & Managing Director ARUN DATTA

R.K.DASN.R. KRISHNAN

RUPA GURUNATH V. MANICKAMWholetime Director A. SANKARAKRISHNAN

N. SRINIVASANPlace : Chennai R. SRINIVASAN G.BALAKRISHNAN K.SUBRAMANIANDate : 30thApril, 2010 Joint President (Finance & Accounts) President & Company Secretary Directors

Name of the SubsidiariesIndustrial ICL ICL ICL Trishul Indo Zinc PT.Coromandel

Chemicals & Securities Financial International Concrete Ltd. MineralsMonomers Ltd. Ltd. Services Ltd. Ltd. Products Ltd. Resources

1. Financial year ending 31.03.2010 31.03.2010 31.03.2010 31.03.2010 31.03.2010 31.03.2010 31.12.20092. Extent of Holding Company’s interest at the end

of the financial year of the subsidiary 98.59% 100.00% 100.00% 100.00% 99.88% 60.89% 98.00%3. The net aggregate amount of the subsidiaries’

profit less losses or vice versa so far it concerns Rs. Lakhs Rs. Lakhs Rs. Lakhs Rs. Lakhs Rs. Lakhs Rs. Lakhs Rs. Lakhsthe members of the holding company’s accounts(a) for the financial year mentioned against 16.48 95.79 176.78 379.51 147.32 36.50 1.21

item 1 above (Loss) (Loss) (Loss) (Loss) Profit Profit Profit(b) of the previous financial years of the

subsidiaries since they became the holding 451.94 276.67 1796.09 1652.11 124.48 Nil Nilcompany’s subsidiaries (Loss) (Loss) (Loss) (Loss) Profit

4. (a) The net aggregate amount of the subsidiaries’profits less losses, for the financial year againstitem 1 above so far as these profits are dealtwith in the holding company’s accounts.

(b) The net aggregate amount of the subsidiaries’profits less losses, for the previous financialyears of the subsidiaries since it became theholding company’s subsidiaries, so far asthese profits are dealt with in the holdingcompany’s accounts.

5. Changes in the holding company’s interest in thesubsidiaries between the end of the financial yearof the subsidiary and the end of the holdingcompany’s financial year.

6. Material changes which have occurred between theend of the aforesaid financial year of thesubsidiaries and the end of holding company’sfinancial year in respect of :

(a) the subsidiaries’ fixed assets.

(b) its investments.

(c) the money borrowed by it for any purpose otherthan that of meeting current liabilities.

As the financial year of all the subsidiaries other than PT. Coromandel MineralsResources coincides with the financial year of the holding company i.e., The IndiaCements Ltd., Sec. 212(5) of the Companies Act, 1956 is not applicable.

Not dealt Not dealt Not dealt Not dealt Not dealt Not dealt Not dealtin the in the in the in the in the in the in the

holding holding holding holding holding holding holdingCompany’s Company’s Company’s Company’s Company’s Company’s Company’s

Accounts Accounts Accounts Accounts Accounts Accounts Accounts

Nil

Nil

Nil

Nil

74

INFORMATION IN AGGREGATE FOR EACH SUBSIDIARY AS AT 31st MARCH, 2010

SubsidiariesIndustrial Chemicals and Monomers Limited ICML

ICL Securities Limited ICLSL

ICL Financial Services Limited ICLFSL

ICL International Limited ICLIntl

Trishul Concrete Products Limited TCPL

PT. Coromandel Minerals Resources CMR

Indo Zinc Limited IZL

Rs. Lakhs

ICML ICLSL ICLFSL ICLIntl TCPL CMR IZL

Capital: Paidup 227.82 5.00 5.00 5.00 193.73 128.54 448.78

Advance towards equity 8.31 608.02 591.20 0.00 0.00 0.00 1.00

Reserves 4.52 0.00 0.00 0.00 701.97 6.32 574.71

Accumulated Losses 1291.78 372.46 1972.87 2029.52 0.00 0.00 0.00

Total Assets (including Investments) 68.23 13231.59 14724.16 201.58 2969.35 154.20 76900.52

Total Liabilities 1340.24 12991.03 16100.83 2226.10 2030.91 19.34 75876.03

Details of Investments (includinginvestments held thro’ Trusts) 0.02 12134.82 13949.94 0.00 0.00 0.00 0.00

Turnover 0.00 199.48 202.38 174.64 8433.90 0.00 159.70

Profit / (Loss) before Taxation (16.72) (95.79) (176.21) (379.51) 215.66 0.00 59.94

Provision for Taxation 0.00 0.00 0.57 0.00 68.13 0.00 0.00

Profit / (Loss) after Taxation (16.72) (95.79) (176.78) (379.51) 147.53 0.00 59.94

Proposed Dividend Nil Nil Nil Nil Nil Nil Nil

As per our Report of 30th April, 2010

For P.S.SUBRAMANIA IYER &CO., For BRAHMAYYA & CO., N.SRINIVASAN B.S.ADITYAN ARUN DATTAChartered Accountants Chartered Accountants Vice Chairman & Managing Director R.K. DAS N.R. KRISHNANG.HARIHARAN N.SRI KRISHNA V. MANICKAM A. SANKARAKRISHNANPartner Partner RUPA GURUNATH N. SRINIVASAN K. SUBRAMANIANMembership No. 15071 Membership No. 26575 Wholetime Director Directors

Place : Chennai R. SRINIVASAN G.BALAKRISHNANDate : 30th April, 2010 Joint President (Finance & Accounts) President & Company Secretary

75

AUDITORS’ REPORT ON THE CONSOLIDATED FINANCIAL STATEMENTS

1. We have audited the attached Consolidated Balance Sheet of The India Cements Limited and its subsidiaries (The India Cements LimitedGroup) as at 31st March 2010, the Consolidated Profit and Loss Account and the Consolidated Cash Flow Statement for the year then ended.These financial statements are the responsibility of The India Cements Limited's management and have been prepared by the managementon the basis of separate financial statements and other financial information regarding components. Our responsibility is to express anopinion on these financial statements based on our audit.

2. We conducted our audit in accordance with generally accepted auditing standards in India. These Standards require that we plan and performthe audit to obtain reasonable assurance whether the financial statements are prepared, in all material respects, in accordance with anidentified financial reporting framework and are free of material misstatements. An audit also includes, examining on a test basis, evidencesupporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used andsignificant estimates made by management, as well as evaluating the overall financial statements. We believe that our audit provides areasonable basis for our opinion.

3. (a) We did not audit the financial statements of a subsidiary, whose financial statements reflect total assets (net) of Rs.133.42 Lakhs as at31st March, 2010, total revenue of Rs.1.23 Lakhs and net cash in flows amounting to Rs.9.01 Lakhs for the year ended on that date.These financial statements and other financial information have been audited by other auditors whose reports have been furnished to usand our opinion is based solely on the report of other auditors.

(b) In case of certain subsidiaries of the company, having total assets (net) of Rs.68113.14 Lakhs as at 31st March, 2010, total revenue ofRs.8533.17 Lakhs and profit after tax (net) Rs.207.47 Lakhs for the year ended 31st March, 2010 and in the case of associate companieshaving a profit after tax of Rs.1344.81 Lakhs for the year ended 31st March, 2010 the figures used for the consolidation are based on themanagement accounts and are therefore unaudited.

4. We report that the Consolidated Financial Statements have been prepared by The India Cements Limited's management in accordance withthe requirements of Accounting Standard (AS) 21, Consolidated Financial Statements and Accounting Standard (AS) 23, Accounting forInvestments in Associates in Consolidated Financial Statements notified pursuant to the Companies (Accounting Standards) Rules, 2006.

5. Based on our audit as aforesaid and on consideration of the reports of other auditors on separate financial statements and on other financialinformation of the components read together with our observations in Para 3 and to the best of our information and according to the explanationsgiven to us, we are of the opinion that the attached Consolidated Financial Statements give a true and fair view in conformity with theaccounting principles generally accepted in India.a) in the case of Consolidated Balance Sheet, of the state of affairs of The India Cements Group as at March 31, 2010;b) in the case of the Consolidated Profit and Loss Account, of the consolidated results of operations of The India Cements Group for the

year then ended andc) in the case of the Consolidated Cash Flow Statement, of the Consolidated Cash Flow of The India Cements Group for the year then

ended.

For P. S. SUBRAMANIA IYER & Co., For BRAHMAYYA & Co.,Firm Registration No: 004104S Firm Registration No. 000511SChartered Accountants Chartered AccountantsG.HARIHARAN N.SRI KRISHNAPartner PartnerMembership No. 15071 Membership No. 26575

Place : ChennaiDate : 30th April, 2010

P.S. SUBRAMANIA IYER & CO. BRAHMAYYA & CO.Chartered Accountants Chartered Accountants103, P.S. Sivaswamy Salai 48, Masilamani RoadMylapore Balaji Nagar, RoyapettahChennai - 600 004 Chennai - 600 014

76

CONSOLIDATED BALANCE SHEET AS AT 31st MARCH 20102010 2009

Rs. Lakhs Rs. Lakhs Rs. Lakhs Rs. LakhsSchedule

SOURCES OF FUNDS :1. Shareholders’ Funds :

a) Capital 1 30717.45 28243.05b) Equity Share Entitlement Warrants 1.00 –c) Funds Pending allotment of Shares [ICML] 8.30 8.30d) Reserves and Surplus 2 373806.83 404533.58 325177.98 353429.33

2. Minority Interest 152.33 311.913. Loan Funds :

a) Secured Loans 3 102616.13 103699.74b) Unsecured Loans

i) From Banks and others 4 33145.60 1172.45ii) Foreign Currency Convertible Bonds

(Note No. 21) 33682.50 38040.00iii) Interest free Sales tax deferral loans 60618.14 230062.37 55965.51 198877.70

4. Deferred Tax Liability [Note No .27] 29033.29 27438.38663781.57 580057.32

APPLICATION OF FUNDS :1. Fixed Assets : 5

a) Gross Block 573997.03 533599.37b) Less : Depreciation 180114.27 151208.25c) Net Block 393882.76 382391.12d) Capital Work-in-Progress 142905.77 536788.53 90404.47 472795.59

2. Investments 6 51478.99 35559.55

3. Current Assets, Loans and Advances: 7a) Inventories 45020.47 37311.40b) Real Estate - Projects in Progress 2042.47 2042.47c) Sundry Debtors 50027.87 36941.29d) Cash and Bank Balances 7683.07 8797.48e) Loans and Advances 107885.07 100344.13

212658.95 185436.77

Less : Current Liabilities and Provisions 8 139208.43 73450.52 117155.82 68280.95

4. Deferred Tax Asset (Note No. 27) 2063.53 1845.23

5. Miscellaneous Expenditure to the extentnot written off or adjusted :Deferred Revenue Expenditure 0.00 1576.00

663781.57 580057.32As per our Report of 30th April, 2010

CONSOLIDATED ACCOUNTS

For P.S.SUBRAMANIA IYER &CO., For BRAHMAYYA & CO., N.SRINIVASAN B.S.ADITYAN ARUN DATTAChartered Accountants Chartered Accountants Vice Chairman & Managing Director R.K. DAS N.R. KRISHNANG.HARIHARAN N.SRI KRISHNA V. MANICKAM A. SANKARAKRISHNANPartner Partner RUPA GURUNATH N. SRINIVASAN K. SUBRAMANIANMembership No. 15071 Membership No. 26575 Wholetime Director Directors

Place : Chennai R. SRINIVASAN G.BALAKRISHNANDate : 30th April, 2010 Joint President (Finance & Accounts) President & Company Secretary

77

2010 2009Rs. Lakhs Rs. Lakhs Rs. Lakhs Rs. Lakhs

Note No. ScheduleINCOME :Sales and Other Income 9 428492.93 403143.56Less: Excise Duty (41343.59) (47963.20)

Total Income 387149.34 355180.36

EXPENDITURE:Manufacturing and other Operating Expenses 10 168996.83 147404.75Salaries, Wages and Amenities 11 25361.87 20329.20Administration and Other Charges 12 17544.62 13335.09Selling and Distribution Expenses 9 87718.65 68392.07Interest & Other Charges (Net) 20 13 14284.54 11227.96Depreciation 29460.27 26436.88Less: Transfer from Revaluation Reserve (5716.44) (5686.44)Less: Transfer from Deferred Income (298.80) 23445.03 (298.80) 20451.64Directors’ Remuneration 14 2688.23 2325.45Donations 15 598.87 316.08(Increase) / Decrease in Stock 16 (1510.58) (1331.86)Total Expenditure 339128.06 282450.38Profit before tax and extra ordinary Items 48021.28 72729.98Prior Period income / (Expense) 0.00 8.67Extra Ordinary Items:Foreign Currency Translation difference on FCCBs 21 4357.50 (7942.50)Share / Bonds Issue Expenses 1327.96 0.00Less : Transfer from Share Premium (1327.96) 0.00 0.00 0.00Profit / (Loss) Before Tax 52378.78 64796.15Provision for taxes:Fringe benefit Tax 0.00 (486.72)Provision for Current Tax (16393.70) (18262.48)Deferred Tax Liability 27 (1373.00) (17766.70) (2992.75) (21741.95)Profit / (Loss) After Tax 34612.08 43054.20Proportionate Profit/(Loss) of Associate CompaniesAdjustments in value of investements in associates in accordance with AS 23 570.32 (728.50)

35182.40 42325.70Proportionate Profit for Minority Interest 0.00 (83.41)Balance from Previous Year 72745.89 43947.20Opening Balance of Trishul Concrete Products Ltd. Net of minority Interest 234.16 190.02Prior year items adjustments 33.11 0.00Less : Proposed Dividend @ 20% on Equity capital (Previous year: 20%)

and dividend distribution tax thereon (7163.95) (6608.62)Less : Transfer to Contingency Reserve (5000.00) 0.00Less : Transfer to General Reserve (7030.00) (7025.00)

53819.21 30503.60

Balance Carried to Balance Sheet 89001.61 72745.89

Earning / (Loss) Per Share (Rs.) - Basic 12.40 15.01Earning / (Loss) Per Share (Rs.) - Diluted 10.96 15.01Notes on Accounts 17

As per our Report of 30th April, 2010

CONSOLIDATED PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31st MARCH 2010CONSOLIDATED ACCOUNTS

For P.S.SUBRAMANIA IYER &CO., For BRAHMAYYA & CO., N.SRINIVASAN B.S.ADITYAN ARUN DATTAChartered Accountants Chartered Accountants Vice Chairman & Managing Director R.K. DAS N.R. KRISHNANG.HARIHARAN N.SRI KRISHNA V. MANICKAM A. SANKARAKRISHNANPartner Partner RUPA GURUNATH N. SRINIVASAN K. SUBRAMANIANMembership No. 15071 Membership No. 26575 Wholetime Director Directors

Place : Chennai R. SRINIVASAN G.BALAKRISHNANDate : 30th April, 2010 Joint President (Finance & Accounts) President & Company Secretary

78

SCHEDULE 1SHARE CAPITAL

No.of 2010 No.of 2009Shares Rs.Lakhs Shares Rs.Lakhs

AUTHORISED :

Equity Shares ofRs.10/- each 460000000 46000.00 460000000 46000.00

Redeemable CumulativePreference Shares ofRs.100/- each 7500000 7500.00 7500000 7500.00

53500.00 53500.00ISSUED :

Equity Shares ofRs.10/- each 307175723 30717.57 282431973 28243.20

30717.57 28243.20SUBSCRIBED :

Equity Shares ofRs.10/- each 307175657 30717.57 282431907 28243.20

Less: Calls in arrears(Other than Directors) 3492 0.12 3537 0.15

307172165 30717.45 282428370 28243.05

Notes :

1. 14,00,000 equity shares of Rs.10/-each (28,00,000 equity shares ofRs.5/- each before consolidation) were issued as fully paid up bonusshares in 1969 by capitalising Rs.140 lakhs out of General Reserve and321,68,291 equity shares of Rs.10/- each were issued as fully paid upbonus shares in 1996 by capitalising Rs.32,16,82,910 out of SharePremium.

2. During the year 1994-95, the company allotted 58,57,987 equity sharesof Rs.10/- each consequent to issue of equivalent number of GlobalDepository Receipts (GDR).

3. During the year 1995-96, the Company allotted 15,00,000 equity sharesof Rs.10/- each to promoters group on exercise of their option to subscribeagainst the warrants issued at Rs. 215/- per share in the ratio of oneshare per warrant.

4. During the year 1998-99, the Company allotted 6,43,38,002 rights equityshares of Rs.10/- each in the ratio of 1:1 at a premium of Rs.15/- pershare.

5. During the year 1999-2000, the Company allotted 1,08,69,500 equityshares of Rs.10/- each at a premium of Rs. 82/- per share to the ForeignInstitutional Investors.

6. During the year 2005-06, the Company allotted 5,12,27,592 underlyingequity shares of Rs.10/- each represented by 2,56,13,796 GlobalDepository Shares (GDS) in the ratio of 2:1

7. During the year 2006-07, the company allotted 2,96,00,561 equity sharesof Rs.10/- each at a price of Rs.47/- per share on conversion of equitywarrants issued to ADRC Limited, Mauritius.

8. During the year 2006-07 the company issued Zero Coupon ConvertibleBonds aggregating to USD 75 million, with an option to convert at a priceof Rs.305.57 per equity share of Rs. 10/- each fully paid up, with a fixedrate of conversion of Rs.44.77 per USD and approximately 109,88,481shares would be issuable on May 12, 2011 on conversion.

9. During the year 2006-07, the company announced Employees’ StockOption Scheme (ESOS) to its employees. Under this scheme, themanagerial employees were granted 14.79 lakhs options and each optionis entitled to one equity share of Rs.10/- each fully paid up at a price ofRs.50/- per share including premium of Rs.40/- per share. The optionsvested with employees in two equal instalments to be exercised on orbefore December 1, 2008 and December 1, 2009. Consequent to this

CONSOLIDATED ACCOUNTS

SCHEDULES ANNEXED TO AND FORMING PART OF CONSOLIDATED BALANCE SHEET AND CONSOLIDATED PROFIT AND LOSSACCOUNT FOR THE YEAR ENDED 31ST MARCH, 2010

719,000 shares and 700,000 shares were allotted out of the 1st and 2ndinstalments respectively.

10. During the year 2007-08, the company allotted 400,00,000 Equity sharesof Rs.10/- each fully paid up, to the shareholders of erstwhile VisakaCement Industry Limited (VCIL) pursuant to the order dated 25th July,2007 of the Honourable High Court of Judicature at Madras sanctioningthe Scheme of Amalgamation of VCIL with The India Cements Limited.

11. During the year 2007-08, the company allotted 207,89,000 Equity sharesof Rs.10/- each fully paid up, to Qualified Institutional Buyers at a priceof Rs.285/- per share including premium of Rs.275/- per share.

12. During the year 2009-10, 3000 options were granted under ESOS 2006.The options will vest in two equal instalments to be exercised on or beforeSeptember 1, 2011 and September 1, 2012.

13. During the year 2009-10, the company allotted 245,94,000 Equity sharesof Rs. 10/- each fully paid, to Qualified Institutional Buyers at a price ofRs.120.20 per share including premium of Rs.110.20 per share and149750 equity shares of Rs.10/- each fully paid, to the eligible employeesat a price of Rs.50/- per share including premium of Rs.40/- per shareunder ESOS 2006.

14. No Interest has been recognised as income from April 2002 on calls inarrears.

SCHEDULE 2

RESERVES AND SURPLUS2009 Additions Withdrawals 2010

Rs. Lakhs Rs. Lakhs Rs. Lakhs Rs. Lakhs

Capital Reserve 16.17 0.00 0.00 16.17Capital RedemptionReserve 2500.00 0.00 0.00 2500.00Debenture RedemptionReserve 1066.21 0.00 533.54 532.67Securities Premium *1 139571.07 27683.44 1327.96 165926.55Contingency Reserve *2 10865.87 5533.54 0.00 16399.41General Reserve 27220.30 7040.09 0.00 34260.39Deferred Income 4389.13 0.00 298.80 4090.33Capital Investment Subsidy 0.00 15.00 0.00 15.00Amalgamation Reserve 0.00 153.60 0.00 153.60Revaluation Reserve *3 66592.82 0.00 5836.91 60755.91Stock OptionsOutstanding account *4 120.52 0.00 55.33 65.19Tonnage Tax Reserve *5 90.00 0.00 0.00 90.00Profit and Loss account 72745.89 16255.72 0.00 89001.61

325177.98 56681.39 8052.54 373806.83

Notes:

*1 Securities Premium(a) During the year 2009-10, the company allotted 2,45,94,000 Equity

shares of Rs.10/- each fully paid, to Qualified Institutional Buyers at aprice of Rs.120.20 per share including premium of Rs.110.20 per share.

(b) During the year, the company allotted 149750 fully paid up equityshares out of the options vested in 2nd instalment, under ESOS2006, to the employees. Additions to Securities Premium includepremium of Rs.40/- per share of the said equity shares allotted toemployees and fringe benefit thereon of Rs.36.95 per shareaggregating to Rs.115.23 lakhs.

(c) Withdrawals of Rs.1327.96 Lakhs represent Share issue expenses.

(d) Share Premium is net of Calls in arrears of Rs.0.17 lakhs (As on31st March 2009: Rs.0.22 lakhs).

79

*2 Contingency ReserveFor any possible erosion in the value of Investments / Advances / othercontingencies.

*3 Revaluation Reserve:Amounts withdrawn include revaluation reserve on assets retired / sold.

*4 Stock Options Outstanding Account:Out of the 2nd instalment of 739,500 options vested with the employees ason December 01, 2008, the employees exercised their options for 700000shares (as at 31st March 2009: 550250 shares). The Fringe benefit, ofRs.36.95 per share, being the difference between the market value andthe option exercise price of the unexercised options, is shown as Stockoptions outstanding account. The Fringe benefit of Rs. 246.80 per shareon the unexercised options of the 1st instalment aggregating to 20,500options is also included in this account.

*5 Shipping Tonnage Tax Reserve:During the financial year 2007-08, the company opted for “Tonnage Tax”Scheme on the income generated by the ships and as required by Section115VT of Income Tax Act, “Tonnage Tax Reserve” has been created. Inview of the company opting out of the scheme from the financial year2008-09, no further Reserve has been created. (Note No. 17)

SCHEDULE 3

SECURED LOANS2010 2009

Rs. Lakhs Rs. Lakhs(A) Debentures: (Note No. 20)

Secured privately placed Debentures,redeemable / repayable on or before31st March 2016, restructured as per theCorporate Debt Restructuring (CDR) proposalagreed to by the lenders:(i) 2385 Debentures of Rs. 500,000/- each 442.61 476.18(ii) 7630 Debentures of Rs. 500,000/- each 1687.79 1815.36

Total [A] (i) and (ii) 2130.40 2291.54

Interest Accrued 0.27 0.00

Total 2130.67 2291.54

(B) Term Loans:(i) Dalavoi Cement Plant:

Industrial Development Bank of India Ltd. 6242.61 6076.50(ii) Yerraguntla Cement Plant:

Industrial Development Bank of India Ltd. 2740.54 1889.41(iii) Vishnupuram Cement Plant:

a) Industrial Development Bank of India Ltd. 328.72 352.27b) IFCI Ltd 107.36 121.71

(iv) State Bank of India 2787.99 3012.67(v) Allahabad Bank 0.00 309.86(vi) Housing Urban Development

Corporation Ltd. 0.00 22599.66(vii) IDBI Bank Ltd 13056.25 16389.25(viii) Punjab National Bank 22965.31 4097.15(ix) Indian Bank 0.00 340.00(x) Housing Development Finance

Corporation Ltd. 6666.67 10000.00(xi) HDFC Ltd. 0.00 37.12(xii) HDFC Ltd. 7500.00 0.00(xiii) HDFC Bank Ltd. 0.00 6000.00(xiv) Kotak Mahindra Bank 6000.00 0.00

(xv) Foreign Currency Loan from Axis Bank Ltd. 8982.00 0.00

2010 2009Rs. Lakhs Rs. Lakhs

[xvi] Tandur Cement Plant:

a) Industrial DevelopmentBank of India Ltd. 474.82 1956.03

b) IFCI Ltd. 0.00 726.48c) Life Insurance Corporation of India 49.21 188.98d) Rupee Tied Loans 0.00 0.00e) Indian Bank 1081.18 2702.43

[xvii]Bank of Baroda 74.67 0.00

[xviii]Other Financial Institutions 15867.85 0.00

[xix] Liability towards assets acquired onFinancial Lease 9.25 11.16

Total [B] (i) to (xix) 94934.43 76810.68

Interest Accrued 22.99 0.00

Total 94957.42 76810.68

(C) Cash Credit Facilities and OtherWorking Capital Loans fromScheduled Banks

(i) Working Capital and otherTerm Loans from Banks 984.84 1269.80

(ii) Cash Credit Facilitiesfrom Scheduled Banks 4543.20 23327.72Total [C] (i) and (ii) 5528.04 24597.52

Total A to C 102616.13 103699.74

SECURITY :

A. Debentures:

1. Item (i) is secured by a registered first mortgage on the Company’s propertiesin the State of Gujarat and further secured by a joint first equitable mortgage/charge on the immovable and movable assets (excluding assets purchasedunder Asset Credit Scheme and certain other assets specifically excludedfrom the purview of the security) present and future subject to prior chargeon the movable assets in favour of the Company’s bankers for workingcapital requirements.

2. Item (ii) is secured by a registered first mortgage on the company’s propertiesin the state of Gujarat and further secured by a joint first equitable mortgageon the immovable properties of the company both present and future.

B. Term Loans:

1. Items (i) and (ii) are secured by first equitable mortgage and charge on paripassu basis (with other Lenders/Debenture Trustees) on the immovableand movable assets (with exclusion of assets purchased under Asset CreditScheme and certain other assets specifically excluded from the purview ofthe security) both present and future subject to prior charge on the movableassets in favour of the Company’s bankers for working capital requirements.

2. Items (iii)(a) and (vii) are secured by a joint first equitable mortgage/chargeon the immovable and movable assets (excluding assets purchased underAsset Credit Scheme and certain other assets specifically excluded fromthe purview of the security) present and future subject to prior charge onthe movable assets in favour of the Company’s bankers for working capitalrequirements.

3. Item (iii)(b) is secured by an exclusive first charge by way of hypothecationof the equipment purchased together with tools & accessories atVishnupuram cement plant and further secured by a joint first equitablemortgage/charge on the immovable and movable assets (excluding assetspurchased under Asset Credit Scheme and certain other assets specificallyexcluded from the purview of the security) present and future subject to

CONSOLIDATED ACCOUNTSSCHEDULE 2 (contd...)

80

prior charge on the movable assets in favour of the company’s bankers forworking capital requirements.

4. Item (iv) is secured by hypothecation of Fixed Assets of the company atSankarnagar, Dalavoi and Yerraguntla cement plants and further securedby a joint first equitable mortgage / charge on the immovable and movableassets (excluding assets purchased under Asset Credit Scheme and certainother assets specifically excluded from the purview of the security) presentand future subject to prior charge on the movable assets in favour of theCompany’s bankers for working capital requirements.

5. Item (viii) is secured by a first pari passu charge (with other lenders/debenturetrustees) on the movable and immovable fixed assets of the Companyboth present and future save and except book debts and subject to priorcharges created / to be created in favour of the Company’s bankers on itscurrent assets for securing the borrowings for working capital requirements.

6. Item (x) is secured by an equitable mortgage on the immovable property atBoat Club Road, Chennai and by a lien on the fixed deposit held with the bank.

7. Item (xii) is secured by a first pari passu mortgage and charge on the movableand immovable properties and second pari passu charge on the current assetsof the Company’s Cement manufacturing facilities.

8. Item (xiv) is secured by way of exclusive charge on the immovable propertiesbeing the land and building situated at 93, Santhome High Road, Chennai.

9. Item (xv) is secured by a pari passu charge on all the movable assets of theCompany excluding the current assets and movable assets at Chennaiand Parli grinding units excluding current assets.

10. Item (xvi) is secured by first mortgage/charge on a pari passu basis on theimmovable and movable assets of Tandur Cement plant, subject to priorcharge on the movable assets in favour of banks for working capitalrequirements.

11. Satisfaction of charge is to be filed in the case of certain loans that havebeen paid during the year.

12. The term loan from State Bank of India is additionally secured by a secondcharge on the current assets of the company.

13. Item (xix) Secured by way of hypothecation of movable assets pertaining tothe Cement project at Banswara.

C. Cash Credit facilities and Working capital loans from ScheduledBanks:The fund based and non-fund based working capital facilities are securedby a first charge on pari passu basis on all the current assets and secondcharge on the movable fixed assets and immovable properties of thecompany. The working capital term loans are secured by a first charge onpari passu basis on the movable fixed assets and immovable properties ofthe company and a second charge on the current assets.

D. Loans mentioned in B(i) carry an option for conversion into equity shares atpar not exceeding 20% of the sanctioned loan/outstanding loan in the adventof certain events and subject to conditions.

SCHEDULE 4

UNSECURED LOANS2010 2009

Rs. Lakhs Rs. LakhsFixed Deposits 1285.85 1172.23Short Term Loans 13837.56 0.00Loans from Scheduled Banks 2.06 0.22Commercial Papers placed with Banks 18000.00 0.00Sub total 33125.47 1172.45Interest Accrued 20.13 0.00

33145.60 1172.45

SCHEDULE 5

FIXED ASSETS *Rs. Lakhs

GROSS BLOCK DEPRECIATION BLOCK NET BLOCK

Particulars As at 31st Additions Deductions As at 31st For the As at 31st As at 31st As at 31stMar-09 Mar-10 Year Mar-10 Mar-10 Mar-09

Goodwill ** 376.71 410.71 102.54 684.88 0.00 0.00 684.88 1045.98

Land 39947.25 6109.27 20.45 46036.07 0.00 0.00 46036.07 39808.87

Buildings 43581.84 6612.03 81.38 50112.49 1385.93 12300.61 37811.88 32371.31

Plant and Machinery includingElectrical installations *** 372856.84 23677.80 200.27 396334.37 20083.54 144606.93 251727.44 247521.66

Wind Electric Generators 7825.81 0.00 0.00 7825.81 413.22 3800.00 4025.81 4439.03

Ships 23735.99 687.31 0.00 24423.30 3080.18 6539.07 17884.23 20277.10

Furniture, Office Equipmentsincluding Computers 5119.83 1278.73 283.53 6115.03 346.35 3105.48 3009.55 2324.68

Vehicles 2960.33 401.41 702.31 2659.43 348.56 1480.32 1179.11 1383.46

Franchise Rights 36400.00 0.00 0.00 36400.00 3640.00 7589.15 28810.85 32450.85

Computer Software & Licences 1117.65 2288.00 0.00 3405.65 162.49 692.71 2712.94 587.43

Total 533922.25 41465.26 1390.48 573997.03 29460.27 180114.27 393882.76 382210.37

* Note Nos. 22 and 25** Goodwill includes Goodwill net of Capital Reserve arising on account of Investment in Associates Rs.537.12 lakhs (Previous Year Rs.234.69 Lakhs )*** Includes Rs.536.52 Lakhs of equipments on “right to use” basis, which is depreciated over its useful life [As at March 2009 : Rs.536.52 Lakhs]

CONSOLIDATED ACCOUNTSSCHEDULE 3 (contd...)

81

SCHEDULE 6INVESTMENTS

No of Total 2010 No. of Total 2009Company Name Shares/ Face Value Cost Shares/ Face Value Cost

Debentures Rupees Rupees Debentures Rupees Rupees

1. TRADE INVESTMENTS – Long Term (Unquoted)

Coromandel Electric Company Limited 246000 2460000 2460000 246000 2460000 2460000

Preference Shares of Coromandel ElectricCompany Limited

13.25% Cumulative Redeemable ParticipatingPreference Shares 508 5080000 5093268 508 5080000 5093268

18% Cumulative Redeemable ParticipatingPreference Shares (5000 Shares have been given 11600 116000000 141817383 11600 116000000 141817383as security towards a loan obtained by CECL)

14% Cumulative Redeemable Preference Shares 4000000 40000000 45508197 4000000 40000000 45508197

194878848 194878848

2. NON-TRADE INVESTMENTS – Long Term

(A) Fully paid equity shares of Companies (Quoted)

Karur KCP Packagings Limited 996500 9965000 39860000 996500 9965000 39860000

The India Cements Limited (Held in trust on behalfof Subsidiaries) 19954024 199540240 1673084575 19954024 199540240 1673084575

India Cements Capital Limited 10400000 104000000 254498697 10400000 104000000 254498697

1967443272 1967443272

(B) Shares of Companies - Long Term (Unquoted):

Other than Subsidiaries:

Fully paid Equity Shares:

In Associates

Coromandel Sugars Limited 7000100 70001000 99480222 7000100 70001000 99480222

Raasi Cement Limited 239427 2394270 67308846 239427 2394270 74750530

Unique Receivable Management Private Limited 24600 246000 246000 24600 246000 246000

Coromandel Travels Limited 490000 4900000 4900000 490000 4900000 4900000

Other than Associates:

Andhra Pradesh Gas Power Corporation Limited. 5896000 58960000 483100750 5896000 58960000 483100750

Jagati Publications Private Limited (138888 Shares 1111110 11111100 400000000 972222 9722220 350000000purchased during the year)

Carmel Asia Holdings Limited 190839 1908390 50000000 190839 1908390 50000000

Senka Carbon Private Limited 6450 645000 3937934 6450 645000 3937934

Sun Paper Mill Limited (Listed but not Quoted) 325200 3252000 3252000 325200 3252000 3252000

Jubilee Cements Limited 100 1000 1000 100 1000 1000

ICL Shipping Limited 5000 50000 50000 5000 50000 50000

Pullivendula Polymers Pvt. Ltd. (Entire Quantity 460000 4600000 4600000 0 0 0purchased during the year)

Bharathi Cement Corporation Ltd. (Formerly knowns asRaghuram Cements Ltd.) (344826 Preference shares 1803973 18039730 953263150 1459147 14591470 453263150purchased during the year) (Preference shares wereconverted into Equity Shares during the year)

Other than Subsidiaries Total 2070139902 1522981586

(C) Government and Trustee Securities:

National Savings Certificates 120200 120200 120200 120200

Indira Vikas Patra Certificates 2100 2100 2100 2100122300 122300

CONSOLIDATED ACCOUNTS

82

SCHEDULE 6 (contd...)

No of Total 2010 No. of Total 2009Company Name Shares/ Face Value Cost Shares/ Face Value Cost

Debentures Rupees Rupees Debentures Rupees Rupees

(D) Other Investments (Quoted) :

Floating rate Fund of Unit Trust of India(Purchased during the year) (NAV as on 31.03.2010:Rs.500688807) 499615 499614947 500000000 0 0 0

Treasury Advantage Fund of Unit Trust of India(Purchased during the year) (NAV as on 31.03.2010:Rs.500702939) 42092148 420921481 500000000 0 0 0

1000000000 0

(E) Fully Paid Shares of Co-operative Societies -Long Term (Unquoted) :

The India Cements Employees Co-operative StoresLimited, Sankarnagar. 2500 125000 125000 2500 125000 125000

The India Cements Employees Co-operative StoresLimited, Sankari West. 5000 50000 50000 5000 50000 50000

The India Cements Mines Employees Co-operativeStores Limited, Sankari West. 5300 53000 53000 5300 53000 53000

The India Cements Mines Employees Co-operativeStores Limited, Sankarnagar 30 1500 1500 30 1500 1500

229500 229500

Grand Total (1) + (2) 5232813822 3685655506

Less: Provision for Diminution in Value 67641762 7774446

5165172060 3677881060

Adjustment as per Accounting Standard 23

1 - Increase / (Decrease) in Value Post Investment

Raasi Cement Limited (8069526) (8069526)

Coromandel Sugars Limited 66249990 (16198176)

India Cements Capital Limited (121772284) (134576783)

Coromandel Travels Limited (4900000) (4900000)

Coromandel Electric Company Limited 94677169 85277436

26185349 (78467049)

2 - Goodwill arising on Investment

Raasi Cement Limited (66681004) (66681004)

India Cements Capital Limited 23468579 23468579

Unique Receivable Management Private Limited (246000) (246000)

(43458425) (43458425)

Grand Total 5147898984 3555955586

Rs. Lakhs 51478.99 35559.55

Note:Aggregate of Quoted InvestmentsCost 2967565572 1967565572

Market Value 2728390062 21447400Aggregate of Unquoted InvestmentsCost 2265248250 1718089934

CONSOLIDATED ACCOUNTS

83

CONSOLIDATED ACCOUNTS

SCHEDULE 7CURRENT ASSETS, LOANS AND ADVANCES

2010 2009Rs. Lakhs Rs. Lakhs

A. CURRENT ASSETS :

1. Inventories :Stores/Spares (including coal andpacking materials) 29028.58 22504.51

Raw Materials 5009.12 5184.72Work-in-Process 560.84 849.35Semi-Finished Goods 7855.52 5910.15

Finished Goods 2566.41 2862.67

45020.47 37311.40

2. Real Estate - Projects in progress 2042.47 2042.47

3. Sundry DebtorsOutstanding for more than six 3935.39 4339.35months (Net of bad debts written offRs.43.56 lakhs (Financial year 2008-09 :Rs.86.33 lakhs))Less: Provision for doubtful debts (716.10) (891.58)Sub total 3219.29 3447.77

Total - Sundry Debtors, considered good 46808.58 33493.52(Secured by Trade deposits aggregatingto Rs.29960.07 lakhs (as at 31st March2009: Rs.23176.72 lakhs))

50027.87 36941.29

4. Cash, Stamps and Bank Balances :Cash, Cheques and Stamps on hand 304.87 65.46

Cash at Scheduled Banks in CurrentAccounts 292.79 664.24Fixed Deposits with Scheduled Banks 7085.41 808.91

Unutilised monies out of issue of shareCapital kept in Fixed Deposits withscheduled banks 0.00 7258.87

7683.07 8797.48

[A] 104773.88 85092.64

B. LOANS AND ADVANCES (Note No. 26)

1. Secured :

Housing and other Loans to employeesincluding interest accrued 565.54 572.56

2. Unsecured (Considered good) :

Advance for Goods 4897.17 5055.62

Other Advances recoverable in cash orin kind or for value to be received 87189.93 67099.27(Note No. 5)

Prepaid Expenses 1536.00 542.62

Unutilised monies out of issue of shareCapital kept in Deposits with FinancialInstitution 0.00 22643.26

Deposits with a Financial Institution 8235.42 0.00

Other Deposits 5406.92 4401.77

Advance payment of Tax (Net of provision) 54.09 29.03

[B] 107885.07 100344.13

Total A & B 212658.95 185436.77

SCHEDULE 8CURRENT LIABILITIES AND PROVISIONS

2010 2009Rs. Lakhs Rs. Lakhs

CURRENT LIABILITIES:Creditors for Goods including Letters of Credit 17654.35 19292.29Creditors for Expenses (including liabilityas per Accounting Standard 15) 37953.04 20146.67Creditors for Capital Expenditure (Note No. 22) 27673.17 36760.57Other Liabilities 9769.56 6255.10Trade Deposits 29960.07 23176.72Interest accrued on secured and unsecuredloans not due 1450.42 506.69Customers’ Credit Balances 3757.20 2466.54MAT payable 0.00 13.89

PROVISIONS:For Proposed Dividend including tax 7163.95 6608.62For Income Tax (Net of Advance) 3826.67 1928.72

139208.43 117155.82Investor Education and Protection Fund *(Appropriate amount shall be transferred to“Investor Education and Protection Fund”,if and when due)

(a) Unpaid Dividend 41.48 25.29(b) Unpaid Share Application Money 0.00 0.00(c) Unpaid Matured Deposits 41.11 37.81(d) Unpaid Matured Debentures 0.00 0.00(e) Interest accrued on (a) to (d) above 0.00 0.00

82.59 63.10

* All the above items are included in Schedule 8 “Current Liabilities”except unpaid matured Debentures and interest accrued which areincluded in Schedule 3 “Secured Loans” (Note No.20)

SCHEDULE 9SALES AND OTHER INCOME

2010 2009Rs. Lakhs Rs. Lakhs Rs. Lakhs Rs. Lakhs

Sales including Excise Duty 400923.31 373541.79Sales Ready Mix Concrete 8416.74 9211.47Freight Earnings 5189.51 7092.45Value of Power Generated fromWind Farms 1309.88 981.32Home Textiles 31.85 26.06Marine Equipments 0.00 6.08

(A) 415871.29 390859.17

DIVIDEND AND INTEREST:On Trade Investments 672.82 718.63On Other Investments 8.56 21.36Others 1698.28 4136.61[Tax Deducted at SourceRs. 102.99 Lakhs 2379.66 4876.60Previous Year Rs. 70.18 Lakhs]Rent Recovery 23.16 19.77Profit on Sale of Assets 102.36 21.87Profit on Sale of Investments 0.00 118.78Foriegn Exchange Translationdifference 1380.81 12.58Miscellaneous Income(Note No. 22) 8735.65 7063.52Overseas Service Charges 0.00 171.27

10241.98 7407.79Total Other Income (B) 12621.64 12284.39Total (A) & (B) 428492.93 403143.56

84

SCHEDULE 10

MANUFACTURING AND OTHER OPERATING EXPENSES

2010 2009Rs. Lakhs Rs. Lakhs Rs. Lakhs Rs. Lakhs

1. Raw Materials Consumed

Opening Stock 5310.65 5095.83

Add: Purchases 36618.27 28979.04Own Quarrying (Net) 16111.77 13029.81(Note No.7.a)

52730.04 42008.85

58040.69 47104.68

Less: Closing Stock 5009.12 5310.65

Total Raw MaterialsConsumed 53031.57 41794.03

2. Stores Consumed(Note No.7.b) 4547.75 3644.09

3. Power and Fuel 100132.00 89296.44

4. Repairs & Maintenance:

Building 53.64 49.43

Machinery 4774.73 5066.68

Others 4864.18 5802.94

Total Repairs &Maintenance 9692.55 10919.05

5. Agency and Port Charges 349.55 536.84- Shipping

6. Excise Duty on stockadjustment 20.80 115.11

7. Transit Mixer Expenses 1222.61 1099.19

168996.83 147404.75

SCHEDULE 11

SALARIES, WAGES AND AMENITIES

2010 2009Rs. Lakhs Rs. Lakhs

Salaries, Wages and Bonus 18115.63 15634.29

Contribution to Provident Fund 730.63 582.67

Gratuity 605.05 575.87

Superannuation 1084.18 537.60

Employees’ Provident Fund Admn Charges 51.05 42.63

Employees’ State Insurance Scheme 12.55 16.46

Workmen and Staff Welfare Expenses* 3286.78 2426.80

Unavailed leave balances 1476.00 239.63

Perquisite value of Employees’ Stock Options(Note No. 31) 0.00 273.25

Total 25361.87 20329.20

* Includes Expenses on Schools Rs.197.19 Lakhs(Previous Year Rs.177.22 Lakhs) which is net ofGrants Rs.324.76 Lakhs [Previous Year Rs.229.49 Lakhs]

SCHEDULE 12

ADMINISTRATION AND OTHER CHARGES

2010 2009Rs. Lakhs Rs. Lakhs Rs. Lakhs Rs. Lakhs

Insurance 614.64 575.65

Rent 385.33 616.64

Rates and Taxes 508.18 395.70

Printing and Stationery 190.47 184.17

Postage, Telephones and Telegrams 357.03 405.14

Other Administration Expenses 12415.67 9186.79

Legal Fees 173.92 111.36

Travelling Expenses 32.22 136.51

Directors’ Sitting Fees 20.14 16.98

Auditors’ Expenses:

Audit Fees 84.63 60.92

Cost Audit Fees 10.00 7.00

Certifications/Others 16.72 25.73

Tax Audit/Other Services 16.50 10.67

Travel/out of pocket expenses 5.67 5.95

133.52 110.27

Amortisation of Deferred RevenueExpenses (Note No. 6) 1594.90 1024.33

Loss on Sale of Assets 148.77 66.90

Provision for Dimunition in Investments 673.09 0.00

Provision for Doubtful Advances 296.74 504.65

Provision for Doubtful Advances /Debtors - Opening balance 730.42 340.85

Add: Additional Provisions duringthe year 357.74 504.65

1088.16 845.50

Less: Bad debts / Advanceswritten off during the year 104.56 115.08

Provision for Doubtful Advances /Debtors - Closing Balance 983.60 730.42

Total 17544.62 13335.09

SCHEDULE 13

INTEREST AND OTHER CHARGES (NET)

Interest on Debentures 323.74 374.16

Interest on Fixed Loans 12745.43 9003.81

Interest - Others 443.45 1094.38

Bank Charges 771.92 755.61

Total 14284.54 11227.96

CONSOLIDATED ACCOUNTS

85

CONSOLIDATED ACCOUNTSSCHEDULE 14

DIRECTORS’ REMUNERATION

2010 2009Rs. Lakhs Rs. Lakhs Rs. Lakhs Rs. Lakhs

Managing Director :Salary 360.00 360.00HRA 108.00 108.00Contribution to Provident Fund 43.20 43.20Contribution to Gratuity andSuperannuation Funds 69.00 69.00Commission 1011.00 844.00Others 2.64 1593.84 3.41 1427.61

Executive Director :Salary 105.60 288.00HRA 31.68 86.40Contribution to Provident Fund 12.67 34.56Contribution to Gratuity andSuperannuation Funds 18.40 55.20Commission 0.00 422.00Unavailed leave and Gratuityin Excess of Rs.3.50 lakhs 662.59 0.00Others 244.64 1075.58 2.24 888.40

Wholetime Director (includingICL International Ltd.) :

Salary 12.31 7.20HRA 2.61 0.00Contribution to Provident Fund 1.48 0.86Contribution to Gratuity andSuperannuation Funds 2.41 1.38Commission 0.00 0.00

18.81 9.44Total 2688.23 2325.45

SCHEDULE 15

DONATIONSThe India Cements Educational Society 100.22 117.43Rajasthan Chief Minister’s Relief Fund 0.00 50.00Flood Relief Victims ofAndhra Pradesh & Karnataka 65.00 0.00Great Lakes Institute of Management 200.00 0.00Others 233.65 148.65

598.87 316.08

SCHEDULE 16

(INCREASE) / DECREASE IN STOCKOpening Stock of:

Work-in-Process 849.35 669.43Semi-finished Goods 5910.15 4761.18Finished Goods 2712.69 2709.15Real Estate -Projects in Progress 2042.47 2042.47

11514.66 10182.23Less:

Closing Stock of:Work-in-Process 560.84 849.35Semi-finished Goods 7855.52 5910.15Finished Goods 2566.41 2712.12Real Estate -Projects in Progress 2042.47 2042.47

13025.24 11514.09

Total (Increase) / Decrease in Stock (1510.58) (1331.86)

SCHEDULE 17

(A) SIGNIFICANT ITEMS OF ACCOUNTING POLICY

1. The financial statements have been prepared in accordance with Indian GenerallyAccepted Accounting Principles (GAAP), generally under the historical costconvention on accrual basis and exceptions to this basis, if any, are herein specificallymentioned. GAAP comprises mandatory Accounting Standards issued by theInstitute of Chartered Accountants of India (ICAI), the provisions of the IndianCompanies Act, 1956 and the Guidelines issued by ICAI and Securities andExchange Board of India (SEBI).

2. Fixed Assets are valued and shown adopting the following basis:

(a) Fixed assets and Capital work-in-progress of all the cement manufacturingfacilities are shown at revalued amounts as at 31st March 2004. All otherFixed assets acquired are shown at the cost of acquisition. All costs includingfinancing costs and applicable overheads incurred on specific projects/acquisition of undertakings are also capitalised.

(b) Fixed assets acquired on hire purchase or on Financial Lease are shown attheir principal cost, excluding the interest cost included in these agreementswhich is charged to revenue over the tenure of the agreement.

(c) Expenditures and outlays of money on uncompleted projects of a capitalnature are shown as capital works-in-progress until such time these projectsare completed and commissioned.

(d) (i) The company provides depreciation on written down value methodfor Motor Vehicles and for assets acquired prior to 1-4-1982 atHead Office and at Sankarnagar.

(ii) Software development costs and Computers are depreciated onStraight Line method as per Section 205 (2) (b) of the Companies Act,1956.

(iii) Ships are depreciated on Straight Line method, over its estimateduseful life.

(iv) Long term Franchisee Rights are capitalised and amortised over theinitial period of ten years.

(v) For all other assets Straight Line method as per Section 205(2)(b) ofthe Companies Act, 1956 is adopted.

(vi) The depreciation on incremental value arising from the revaluation offixed assets is charged to the Revaluation Reserve account.

(vii) Fixed Assets are tested for impairment and impairment loss, if any, isprovided by a charge to the Profit & Loss account.

3. (a) Where Foreign Currency loans have been availed to acquire fixed assetsfrom outside India, the outstanding liability on these loans is stated at theexchange rate of the rupee as at the year end or at contracted rates with acorresponding adjustment to the carrying cost of the relevant assets.Depreciation is charged to accounts on the values so adjusted over theremaining life of the asset.

(b) Foreign Exchange transactions are accounted at the exchange ratesprevailing at the time of transactions or at contracted rates. Current Assetsand all Liabilities, (other than for acquiring fixed assets as mentioned in 3(a)above), in Foreign currencies are translated at values prevailing as at theyear end. Gains / Losses, if any, arising therefrom are recognised in theProfit and Loss Account.

4. (a) Sales include excise duty, revenue from trade related activities and salestax deferred as reduced by consideration for assignment of Sales Taxdeferral liability and is net of rebates, discounts and incentives.

(b) Revenue from construction projects under Real Estate and PropertyDevelopment Division is recognised on percentage of completion method.

(c) Revenue on time charter of ships is recognized on a proportionate basis.

86

4. Building includes purchase of flats on lease holdlands for which the documents of title are yet tobe executed in favour of the company. 11.13 11.13

5. Loans and Advances:(a) Advances include advances to Associates

representing strategic investments in Cement,Sugar, Shipping and Financial Services, whichrepresent strategic long term investments,which in the opinion of the management, willrealise values stated in the long term. Thecompany, as a prudent measure has createda Contingency Reserve to the extent ofRs.108.66 Crores for any possible erosion inthe value of the said advances. 59578.95 49701.54

(b) Advances include disputed CENVAT /Sales Tax Claims pending in differentstages of appeal. Management is of theopinion that these are recoverable atvalues stated. 632.74 882.22

6. Deferred Revenue expenditure includesexpenses incurred on voluntary retirementschemes, which will be written off over a periodof 60 months commencing from the year followingthe year in which the expenditure was incurred orupto financial year ending 31st March 2010,whichever is earlier. 0.00 1576.00

7. (a) Raw Materials consumed:Own Quarrying includes:(i) Salaries & Wages 1285.34 1204.39(ii) Stores Consumed 2679.87 2654.63(iii) Royalty 6595.54 4235.65

(b) Total Consumption of Stores and Sparesduring the year, including used in ownquarrying; Captive Power generation andRepairs & Maintenance. 17818.45 18469.00

8. Repairs and maintenance includes Stores& Spares 5437.34 6020.60

9. Selling and Distribution expenses include:(i) Packing Charges 15490.51 14002.76(ii) Additional Sales Tax 39.82 14.42(iii) Freight outwards 59110.02 44591.75(iv) Advertisement 3016.17 1784.23

10. Detailed quantitative information of goodsmanufactured during the Report Period:

1. CEMENT:(a) Installed capacity (Tonnes) 14050000 12950000(b) Production (Tonnes) 10493568 9111354(c ) Sales - Cement (Tonnes) 10501271 9117811

- Clinker (Tonnes) 462827 1698Sales - Cement (Gross) (Rs.Lakhs) 392002 375796

- Clinker (Rs.Lakhs) 11569 43403571 375839

(d) Opening Stock of cement produced (Tonnes) 106136 112593Value (Rs.Lakhs) 2627.83 2615.99

(e) Closing stock of Cement produced (Tonnes) 98433 106136Value (Rs.Lakhs) 2475.50 2627.83

2. CALCIUM CARBIDE :(a) Licensed Capacity (Tonnes) 10000 10000(b) Installed Capacity (Tonnes) 12500 12500(c ) Production – –(d) Opening Stock of Finished Goods (Tonnes) 36 36

Value (Rs. Lakhs) 7.88 7.88(e) Closing Stock of Finished Goods (Tonnes) 36 36

Value (Rs. Lakhs) 7.88 7.88

2010 2009Rs. Lakhs Rs. Lakhs

CONSOLIDATED ACCOUNTS

5. Valuation of inventories of raw materials, packing materials, stores, spares, fuelsand work-in-process is at weighted average cost. Semi-finished goods, finishedgoods and Real Estate Projects are valued at cost or net realisable value whicheveris lower. The value of finished goods includes excise duty.

6. Research and Development expenses not resulting in any property / equipment arecharged to revenue under nominal heads.

7. Interest and other costs in connection with borrowing of funds to the extent related/attributed to the acquisition/construction of qualifying fixed assets are capitalisedupto the date when such assets are ready for its intended use.

8. Claims/Incomes arising from price escalation and/or any other item ofcompensation and which are indeterminate are accounted on finalization.

9. Trade investments and investments in subsidiary companies are long terminvestments and are carried at cost. The other investments are carried at lower ofcost or realisable value. Provision for diminution value is made wherever necessaryin accordance with the Accounting Standard.

10. Retirement benefits are provided by charge to revenue including provision forgratuity and superannuation fund determined on an Actuarial basis for which atrust has been created. The Actuarial gains / losses arising on retirement benefitsare also recognised in the Profit and Loss Account. Unavailed leave balancesare accounted based on actuarial principles.

11. Fringe Benefits arising on options vested under Employees Stock Options Scheme(ESOS), 2006 are charged to Profit and Loss Account and credited to Stock OptionsReserve Account. On allotment of shares, corresponding amount is transferred fromStock Options Reserve Account to Securities Premium Account.

12. Premium on redemption of Debentures / Bonds is accounted on redemption andset off against the Securities Premium Account.

(B) NOTES ON ACCOUNTS FOR THE YEAR ENDED 31ST MARCH, 20102010 2009

Rs. Lakhs Rs. Lakhs1. Estimated amounts of Capital Expenditure

Commitments. 21669.22 8766.982. Monies for which the company is contingently Liable:

(a) Letter of Credit Opened By Bankers. 9032.34 5703.95(b) Counter Guarantees to Bankers 41969.20 10356.19

(including guarantees given on behalfof Subsidiaries and Associates).

(c) Sales Tax demand for various years underdispute. 1389.87 799.43

(d) Contingent Liability pertaining to RaasiCement Limited (Residuary Company) forSales Tax, Central Excise and Income Tax. 2295.56 2247.49

(e) Sales Tax deferred under a scheme of theGovernments of Tamil Nadu and AndhraPradesh have been assigned to othercompanies. In view of the assignment theCompany is contingently liable. 3519.93 3519.93

The Sales tax Department issued notices onthe company claiming a sum of Rs. 5873Lakhs stated to have been availed in excessby the company. The Company has depositeda sum of Rs.16 Crores included under Loansand Advances. The issue was challengedby the company before the High Court andthe High Court in December-2006 allowed thewrit petition in favour of the Company. Thedepartment has however gone on appeal tothe Supreme Court.

(f) Contingent Liability on account ofCENVAT Cases and Others. 12905.04 4437.53

3. Claims against the Company not acknowledgedas debts. 11423.88 11950.15

SCHEDULE 17(A) SIGNIFICANT ITEMS OF ACCOUNTING POLICY (Contd.)

87

CONSOLIDATED ACCOUNTSSCHEDULE 17NOTES ON ACCOUNTS (Contd.) 2010 2009

Rs. Lakhs Rs. Lakhs

3. READY MIX CONCRETE:(a) Installed Capacity (Cu.m.) 990000 810000(b) Production (Cu.m.) 276745.00 320512.40(c ) Purchase (Cu.m.) 34454.00 0.00(d ) Sale (Cu.m.) 311238.00 320512.40(e) Opening Stock of Finished Goods (Cu.m.) – –

Value (Rs. Lakhs) – –(f) Closing Stock of Finished Goods (Cu.m.) – –

Value (Rs. Lakhs) – –

4. TEXTILES :

(a) Opening Stock of Home Textiles Produced (Pieces) 25007 26759Value (Rs. Lakhs) 84.29 93.16

(b) Closing Stock of Home Textiles Produced (Pieces) 17674 25007Value (Rs. Lakhs) 71.08 84.29

(c) Opening Stock of Fabrics [Pieces] 4436 5229Value [Rs. Lakhs] 6.46 8.02

(d) Closing Stock of Fabrics [Pieces] 3567 4436Value [Rs. Lakhs] 5.23 6.46

(e) Sales Quantity Home Textiles (Pieces) 7345 3477Value (Rs. Lakhs) 4.93 4.64

(f) Sales Quantity Yarn (Kgs) – –Value (Rs. Lakhs) – –

(g) Sales Quantity Fabrics (Meters) 618 –Value (Rs. Lakhs) 1.68 –

(h) Marine Equipment (Sets) – –Value (Rs. Lakhs) – –

(i) Non Textiles (Nos.) 4300 2834Value (Rs. Lakhs) 25.24 20.96

11. Value of import on CIF basis:(a) Raw Materials 2236.63 2800.45(b) Fuel 37524.11 20701.73(c) Spare Parts and Components 3304.35 1367.31(d) Capital goods 997.17 1759.82(e) Textiles 12.61 6.02

12. Earnings in Foreign Exchange:Export (FOB)Cement – Quantity (Tonnes) 4517 –

– Value (Rs. Lakhs) 127.72 –Textiles – Value (Rs. Lakhs) – –Results Marine - Value (Rs. Lakhs) – 162.09

13. Expenditure in Foreign Currency:Legal & Consultancy Charges 75.93 98.51Travel Expenses and Others 281.62 253.53Indian Premier League - paymentsto foreign players 2305.58 1011.59

14. Remittances in Foreign Currency :Final Dividend on account of GDSNo. of shareholders 1 1Amount remitted (Rs. Lakhs) 56.88 141.16Year to which it pertains 2009 2008

Final Dividend on account of GDRNo. of shareholders 1 1Amount remitted (Rs. Lakhs) 4.15 2.06Year to which it pertains 2009 2008

2010 2009Rs. Lakhs Rs. Lakhs

15. Details of imported and indigenous materialsconsumed during the yearRaw materials:

Imported 3446.53 3708.21Indigenous 46067.66 33285.65Total 49514.19 36993.86

Percentage to Total ConsumptionRaw materials:

Imported 6.96% 10.02%Indigenous 93.04% 89.98%Total 100.00% 100.00%

Spare Parts and Components:Imported 739.91 1324.96Indigenous 1370.08 536.54Total 2109.99 1861.50

Percentage to Total Consumption Spare Parts and Components:

Imported 35.07% 71.18%Indigenous 64.93% 28.82%Total 100.00% 100.00%

16. Details of Raw Materials consumed:Quantity in Tonnes:-

Limestone 12362748 9999523Gypsum 520646 508728Others 2400647 1981395

Value:-Limestone 22125.78 18738.71Gypsum 6436.92 6289.07Others 13287.50 10258.43Freight on Inter Unit Transfer of Clinker 7663.99 1707.65

Total 49514.19 36993.86

17. The Company had opted for the "Tonnage TaxScheme" under the Income Tax Act, 1961 in thefinancial year 2007-08 and has opted out of the saidscheme with effect from 2008-09 financial year.

18. There are no dues to Small Scale Industries whichis outstanding for more than 30 days at the Balancesheet Date computed on unit wise basis. Theabove information regarding Small Scaleundertaking has been determined to the extentsuch parties have been identified on the basis ofinformation available with the Company and hasbeen relied upon by the auditors.

19. There are no dues to Micro, Small and MediumEnterprises which are outstanding as at theBalance Sheet date and there were no delaysas per the provisions of the Micro, Small andMedium Enterprises Development Act, 2006 inpayment of dues to such enterprises. The aboveinformation regarding Micro, Small and MediumEnterprises has been determined to the extentsuch parties have been identified on the basisof information available with the Company andhas been relied upon by the auditors.

20. Note on Debt Restructuring:

[a] The Corporate Debt Restructuring (CDR) Cellformed by the Reserve Bank of India approved

88

CONSOLIDATED ACCOUNTSSCHEDULE 17NOTES ON ACCOUNTS (Contd.)

a Debt Restructuring proposal for all debts otherthan public deposits with effect from 01-01-2003.

[b] The common documentation for creation ofsecurity between all the lenders and thecompany is yet to be executed. Pendingexecution of common documentation betweenthe lenders and the Company, the securityclause under the loans have not been changed.

21 The company had issued USD 75 Million ZeroCoupon Foreign Currency Convertible Bonds[FCCB] which matures on May-12-2011. Thebonds will not bear any interest and areconvertible by holders into shares, subject tocertain conditions. The net proceeds were usedby the company for the purpose of CapitalExpenditure and other purposes, including therepayment of existing debt, as permitted underthe applicable law or regulations.

The conversion price will be Rs.305.57 PerShare with a f ixed rate of exchange onconversion of Rs.44.77 Per USD andapproximately 10988481 Shares would beissuable on May-12-2011, if the conversionoption is exercised by the bond holders.If thebonds are not previously redeemed, convertedor purchased and cancelled, the company willredeem each bond at 147.70 Percent of itsPrincipal Amount on the Maturity date . Theamount of premium on such redemption will beto the tune of Rs.16,062.98 Lakhs.

The Company, subject to fulfillment of certainconditions and obtaining requisite approvals, hasan option to redeem the balance bonds in wholebut not in part at any time on or after May 11,2008 but not less than seven business days priorto Maturity date.

22 The Company has as part of the initiatives topromote corporate image and its brandsparticipated in the IPL T/20 tournaments with itsteam “The Chennai Super Kings”. The right tooperate the franchise provides a platform to buildcorporate and brand image especially in the contextof the company becoming a Pan India Player.

The consideration to operate the franchise,aggregating to USD 91 Million is payable over aperiod of 10 years in equal instalmentscommencing from 2008.

As per the agreement, BCCI-IPL will share itsincome from the sale of media rights andsponsorship income with all the franchisees. Inaddition to the Central revenue as mentionedabove the franchisee will also have local revenuelike gate collections, team sponsorships,uniformsponsors etc. The revenue from operating thefranchise is grouped under MiscellaneousIncome.

The costs involved in operating the franchise likeremuneration to the players, travelling andaccommodation expenses, advertisements,

2010 2009Rs. Lakhs Rs. Lakhs

2010 2009Rs. Lakhs Rs. Lakhs

promotions, etc. are accounted in accordance withthe Generally Accepted Accounting Principles. Theexpenses are grouped under the natural heads ofaccounts.

The company capitalized the entire franchisee feepayable to BCCI-IPL as a "Franchise Right" underintangible asset. Considering the revenue byoperating the franchise and the potential cash flowsarising therefrom the "Franchise Right" is beingamortized over a period of 10 years. The amountpayable to BCCI towards the same is groupedunder Sundry Creditors for Capital Expenditureunder Current Liabilities.

23 Pending finalisation of ongoing negotiations withvarious Banks / Financial Institutions, the claimstowards Interest / Penal interest claims by Banks /Financial Institutions are under negotiation forwaiver, amount not determinable.

24 Related Party Disclosures:

A. Names of the related parties and the nature of therelationship:

(i) Associate Companies:Raasi Cement Ltd.Coromandel Sugars Ltd.India Cements Capital Ltd.Coromandel Travels Ltd.Coromandel Electric Company Ltd.Unique Receivable Management Private Ltd.

(ii) Key Management personnel (KMP):Sri. N.Srinivasan – Vice Chairman & Managing DirectorSri. N.Ramachandran – Executive Director (Upto 12-08-2009)Ms. Rupa Gurunath – wholetime Director (w.e.f. 05-03-2010)

(iii) Relative of KMP having transactions with the Company:Ms. Rupa Gurunath – Director (became wholetime Director

w.e.f. 05-03-2010)Mrs. Chitra Srinivasan – Director (w.e.f. 05-03-2010)

B. Transactions with Associate Companies:Associates:-Sale of Goods 1.05 7.04Purchase of Shares – –Purchase of Goods – –Rendering of Services – –Receiving of Services 6300.01 4797.52Interest receivable on Advances 211.88 290.29Dividend received from Associate Co. 272.29 272.29Guarantees given by Associate Co.on behalf of the Company 32500.00 32500.00Guarantees Outstanding at the year end 6608.00 8008.00Outstanding balance included in current asset 6725.29 5431.81

C. Transactions relating to persons mentioned in

A. (ii) above:Remuneration 2683.51 2316.01Dividend paid during the year 6.49 5.77

Total 2690.00 2321.78

89

CONSOLIDATED ACCOUNTSSCHEDULE 17NOTES ON ACCOUNTS (Contd.)

D. Transactions relating to persons mentioned in

A. (iii) above:Directors’ Sitting Fee 1.60 1.20Dividend paid during the year 1.57 0.73

3.17 1.93

25 Assets Purchased on Financial Lease:Fixed Assets shown in Schedule 5 include the followingassets purchased on Financial Lease:Gross BlockPlant & Machinery 245.05 245.05Office Equipment 0.00 0.00Vehicles 0.00 0.00Total 245.05 245.05

Net BlockPlant & Machinery 132.27 132.27Office Equipment 0.00 0.00Vehicles 0.00 0.00

Total 132.27 132.27

The total minimum lease amount payablein Less than 1 year Nil 11.16Present Value of total minimum lease amountpayable within 1 year Nil 10.94

The total minimum lease amounts payableafter 1 year but within 5 years. Nil NilPresent Value of minimum lease amount payableafter 1 year but within 5 years. Nil Nil

26 Details of Loans and Advances given toAssociates and Others:A. Loans and Advances to Associates

(i) Rate of InterestCoromandel Sugars Ltd. 8% 9%India Cements Capital Ltd. 8% 9%Unique Receivable Management Pvt. Ltd. Nil NilCoromandel Electric Company Ltd. Nil NilCoromandel Travels Ltd. Nil Nil

(ii) Balance as at 31st March

Coromandel Sugars Ltd. 4416.70 4706.05India Cements Capital Ltd. 2107.81 1663.83Coromandel Electric Company Ltd. 47.10 7.61Coromandel Travels Ltd. 153.68 111.21Unique Receivable Management Pvt. Ltd. 0.00 0.00

Total 6725.29 6488.70

(iii) Maximum Balance for the Report Period

Coromandel Sugars Ltd. 4416.70 4730.83India Cements Capital Ltd. 2107.81 1663.83Coromandel Electric Company Ltd. 68.71 53.59Coromandel Travels Ltd. 153.68 181.83Unique Receivable Management Pvt. Ltd. 0.00 0.00

Total 6746.90 6630.08

Notes:-

1. Loans and advances shown above toAssociates and Others are without anyrepayment schedule.

2. ICDs are not considered as they are repayable

on demand and interest is charged at market

rates.

3. Loans to Employees as per Company’s policy

are not considered.

4. Pursuant to the Scheme of Amalgamationapproved by the Honourable High Court ofJudicature at Chennai, the company hasissued equity shares to the shareholders ofVisaka Cement Industry Limited (Visaka).As per the said order 199.54 lakh shares ofthe company have been allotted in aggregate,to the subsidiaries in exchange for their sharesof Visaka and the same are held in a Trust ontheir behalf.

27 Deferred Taxation:

Liability on account of Depreciation (Netof Unabsorbed Depreciation) 29033.29 27438.38

Asset arising on account ofother timing differences 2063.53 1845.23

Net Deferred tax liability 26969.76 25593.15

28 Computation of Earnings / (Loss) per Share

(EPS) Earnings:

Profit / [Loss] for the period 35182.40 42325.69

Less : Provision for Preference Share

Dividend 0.00 0.00

Earnings available to Equity Shareholders -

Basic (A) 35182.40 42325.69

Income or (expenses) accounted in

financial statements attributable to

FCCB Forex transaction loss debited

in P & L during the period (4357.5 x 0.6601) (2876.39) 5242.84

Earnings- Diluted (B) 32306.01 47568.53

No. of Shares

No. of Equity Shares 307175657 282431907

Weighted average No. of Equity Shares (C) 283776865 282041486

No. of Potential Equity Shares 11069481 11219231

Weighted average No. of Potential

Equity Shares 11069481 11219231

Total weighted average no. of shares -

Diluted (D) 294846346 293260717

EPS: Basic (Rs) (A/C) 12.40 15.01

Diluted (Rs) (B/D) 10.96 15.01

2010 2009Rs. Lakhs Rs. Lakhs

2010 2009Rs. Lakhs Rs. Lakhs

90

CONSOLIDATED ACCOUNTSSCHEDULE 17NOTES ON ACCOUNTS (Contd.)

2010 2009Rs. Lakhs Rs. Lakhs

29 Employee Benefits:

The details of parameters adopted forvaluation of post-employment benefit plansand leave benefits, as per AccountingStandard 15 issued by ICAI, are as under:

(a) Contribution to Pension Funds:

The company offers pension plans formanagerial Grade employees and wholetime Directors. While some of theemployees are eligible for Defined BenefitPlan of pension, others are eligible forDefined Contribution Plan of Pension. TheDefined Benefit Plans of pension aremanaged by Life Insurance Corporation ofIndia and the provision has been made onthe basis of actuarial valuation.

The estimated aggregate value of Pensionliability, discounted @8% p.a., under theDefined Benefit Plans and DefinedContribution Plans as at 31st March 2010,are Rs.4100.58 Lakhs and Rs.1032.91Lakhs respectively, as per the details givenbelow:

Defined Benefit Scheme:

Opening Balance as per actuarial valuation 3772.71 3180.55

Add: Interest income / differential interest dueto change in discount rate during the year 99.87 156.22

Less: Settlements during the year 583.79 75.14

Sub Total 3288.79 3261.63

Add: Provision created during the year 811.79 511.08

Closing balance as per actuarial valuation 4100.58 3772.71

Assumptions:

Discount rate 8.00% 8.00%

Salary escalation rate 2.00% 2.00%

Average Age 48yrs. 48yrs.

Average accrued service 14yrs. 14yrs.

Annuity rates for pension computation Rates applicable for 15 yearscertain and life thereafter,

with return of corpus.

Defined Contribution Scheme:

Opening Balance as per actuarial valuation 760.52 734.42

Less: Settlements during the year 0.00 97.62

Sub Total 760.52 636.80

Add: Provision created during the year 272.39 123.72

Closing balance as per actuarial valuation 1032.91 760.52

(b) Leave of absence and encashment:

The Company has different leave plans

including paid leave of absence plans and

encashment of leave plans for employees

at different grades and provision has been

made in accordance with Acounting

Standard 15. The total amount of provision

available for the unavailed leave balances

as at 31st March 2010 is Rs.4583.22 Lakhs

(as at 31st March 2009: Rs.3107.22 Lakhs).

(c) Gratuity:

The employees are eligible for Gratuity

benefits as per the Payment of Gratuity Act,

1972. The Gratuity Scheme is governed by

a Trust created for this purpose by the

company. The amount of Contribution to

be made is arrived at based on an Actuarial

valuation done at the Balance Sheet date,

as given below and is accounted

accordingly.

Opening Balance as per actuarial valuation 2279.00 1831.00

Add: Interest income during the year 20.00 30.00

Less: Settlements during the year 328.00 154.00

Sub Total 1971.00 1707.00

Add: Provisions created during the year 600.00 572.00

Closing balance as per actuarial valuation 2571.00 2279.00

Assumptions:

Discount rate 8.00% 8.00%

Salary escalation rate 2.00% 2.00%

Average Age 52yrs. 52yrs.

Average accrued service 26yrs. 26yrs.

30 Note on Employees Stock Option Scheme, 2006:

During the year 2006-07, the company announced

Employees Stock Option Scheme, 2006 (ESOS

2006) to its employees, which came into force on

1st December 2006. As per the scheme, the

eligible employees are entitled to apply for and be

allotted to one equity share of Rs.10/- each, fully

paid-up, on payment of the exercise price of

Rs. 50/- per Option, which shall vest with the option

holders in 2 equal instalments on 1st December

2007 and 1st December 2008. The vested options

shall be exercised by the option holders within

1 year from the date of vesting.

2010 2009Rs. Lakhs Rs. Lakhs

91

CONSOLIDATED ACCOUNTSSCHEDULE 17NOTES ON ACCOUNTS (Contd.)

Under ESOS 2006, the maximum number ofoptions to be granted in aggregate is not to exceed15,00,000; of which the company issued 14,79,000options, to be vested with the option holders intwo equal annual instalments. Out of the optionsvested on 1st December 2007 and 1st December2008, the option holders exercised their optionsfor and were allotted fully paid up equity sharesaggregating to 7,19,000 (as at 31st March2009:7,19,000 shares) and 7,00,000 (as at 31stMarch 2009:5,50,250 shares) respectively, as atthe Balance sheet.

Accounting of ESOS

The fair market price per equity share of thecompany on the date of vesting, i.e 1st December2007 & 1st December 2008 was Rs.296.80 &Rs.86.95 respectively. On vesting, the excess offair market price over the price paid by theemployees, per scheme, is charged to Profit andLoss account by crediting Stock OptionsOutstanding Reserve Account and on allotmentof shares, the corresponding amount is transferredfrom Stock Options Outstanding Reserve accountto Securities Premium, as per the Guidance Noteissued by The Institute of Chartered Accountants

of India.

31 Accounting for investments in Associates (the

description and proportion of ownership of which

are given below) has been done in line with

Accounting Standard 23, based on unaudited

accounts of Associates of the current year.

Consolidation method adopted

The Consolidated Financial Statements have been

prepared combining the accounts of The India

Cements Limited along with below mentioned

subsidiaries on a line by line basis as required by

AS-21. The minority interest is shown separately.

2010 2009Rs. Lakhs Rs. Lakhs

Name of the Subsidiary Company % of Ownership % of Ownership

ICL Securities Ltd. 100.00 100.00

ICL Financial Services Ltd. 100.00 100.00

ICL International Ltd. 100.00 100.00

Industrial Chemicals & Monomers Ltd. 98.59 98.59

Trishul Concrete Products Ltd. 99.88 59.88

PT. Coromandel Minerals Resources 98.00 98.00

Indo Zinc Ltd. 60.89 0.00

Name of the Associate Company % of % ofOwnership OwnershipDirectly or Directly or

Through ThroughSubsidiaries Subsidiaries

Raasi Cement Ltd. 28.95 28.95

Coromandel Sugars Ltd. 49.99 49.99

India Cements Capital Ltd. 47.91 47.91

Coromandel Electric Company Ltd. 49.20 49.20

Coromandel Travels Ltd. 49.00 49.00

Unique Receivable Management Pvt. Ltd. 49.20 49.20

32 The Primary Segment of the Company is Cementand Other Segments are below the requiredreportable levels as per the Accounting Standard 17

33 Consequent to suspension of operations ofIndustrial Chemicals and Monomers Limited, thecompany has been evaluating the options of eitheroperation of the company or its sale. In themeanwhile all the assets of the company arecarried at book value and not at reinstated value.The Management is of the view that these assetswill realise the values stated therein.

34 The accounting policies adopted by the holdingcompany have been applied from the financial year2001-2002. It is not practicable to apply thestandards for the earlier years.

35 Permission for exemption from disclosure offoreign exchange earnings and expenditure withregard to shipping operations has been received.

36 Previous year’s figures has been regroupedwherever necessary.

2010 2009Rs. Lakhs Rs. Lakhs

92

As per our Report of 30th April, 2010Signatures to Schedules 1 to 17

For P.S.SUBRAMANIA IYER &CO., For BRAHMAYYA & CO., N.SRINIVASAN B.S.ADITYAN ARUN DATTAChartered Accountants Chartered Accountants Vice Chairman & Managing Director R.K. DAS N.R. KRISHNANG.HARIHARAN N.SRI KRISHNA V. MANICKAM A. SANKARAKRISHNANPartner Partner RUPA GURUNATH N. SRINIVASAN K. SUBRAMANIANMembership No. 15071 Membership No. 26575 Wholetime Director Directors

Place : Chennai R. SRINIVASAN G.BALAKRISHNANDate : 30th April, 2010 Joint President (Finance & Accounts) President & Company Secretary

CONSOLIDATED ACCOUNTS(C) STATEMENT PURSUANT TO PART IV OF SCHEDULE VI OF THE COMPANIES ACT, 1956.

Consolidated Balance Sheet Abstract and Company’s General Business Profile

I Registration details :

Registration No. State Code 1 8

Balance Sheet Date

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

Public Issue Rights Issue 8

Bonus Issue Private Placement 2 9 5 6 1 9 9

Employees’ Stock Options exercised 1 3 0 2 1

III Position of mobilisation and deployment of funds (Amount in Rs. Thousands)

Total Liabilities Total Assets 6 6 3 7 8 1 5 7

Sources of Funds : Application of Funds :

Paid up Capital Net Fixed Assets 5 3 6 7 8 8 5 3

Reserves & Surplus Net Current Assets 7 3 4 5 0 5 2

Secured Loans Investments 5 1 4 7 8 9 9

Unsecured Loans Deffered Tax Asset 2 0 6 3 5 3

Deferred Tax liability Profit and Loss Account N I L

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

Turnover Total Expenditure 3 6 3 4 9 2 5 1

Profit/Loss Before Tax Profit/Loss After Tax 3 4 6 1 2 0 8

Earnings Per Share (in Rs.) Dividend Rate % 2 0 %

V Generic names of the Principal Products/Services of the Company : (as per monetary terms)Item Code No.(ITC Code) Product Description

P R O P E R T Y D E V E L O P M E N T

P O W E R G E N E R A T I O NF R O M W I N D F A R M S

T R A D I N GD E A L I N G I N S E C U R I T I E SF I N A N C I A L S E R V I C E SC A L C I U M C A R B I D E

0 0 9 3 1

N I L

N I L

3 1 0 3 1 0

6 6 3 7 8 1 5 7

3 0 7 1 7 4 5

3 7 3 9 6 8 4 6

1 0 2 6 1 6 1 3

1 2 7 4 4 6 2 4

2 9 0 3 3 2 9

4 1 5 8 7 1 2 9

5 2 3 7 8 7 8

1 2 . 4 0

2 5 2 3 2 9 . 0 1 C E M E N TR E A D Y M I X C O N C R E T E

S H I P P I N G

93

CONSOLIDATED ACCOUNTS

CASH FLOW STATEMENT FOR THE YEAR ENDED 31st MARCH, 2010

2010 2009Rs.Lakhs Rs.Lakhs Rs.Lakhs Rs.Lakhs

A. Cash flow from operating activities :

Net Profit before tax and extraordinary items 52949.10 63984.23

Adjusted for :

Depreciation 23445.03 20451.64

Provision for Doubtful Debts & Advances 296.74 504.65

Foreign Exchange -5738.31 7929.92

Profit / Loss on Sale of Investments 0.00 -118.78

Profit / Loss on Sale of Assets 46.41 45.03

Interest Expense 19336.83 14018.73

Interest Income -7522.49 -7682.99

Dividend Income -664.26 -739.99

Perquisite value of Employees’ stock options 0.00 273.25

Deferred Revenue Expenditure/Income 1576.00 30775.95 1024.33 35705.79

Operating Profit before Working Capital Changes 83725.05 99690.02

Trade and other receivables -10592.69 -36875.41

Inventories -7709.07 -4168.91

Trade payables 27756.90 9455.14 17879.28 -23165.04

Cash generated from operations 93180.19 76524.98

Direct Taxes -14531.09 -8366.17

Net Cash from operating activities (A) 78649.10 68158.81

B. Cash flow from investing activities :

Purchase of Fixed Assets -103053.96 -95550.43

Sale of Fixed Assets 669.35 1090.40

Sale of Investments 0.00 718.42

Purchase of Investments -15919.44 -3541.86

Interest received 3079.09 4149.29

Dividend received 664.26 739.99

Refund by / advances to Associates and others -4053.20 820.23

Net Cash from investing activities (B) -118613.90 -91573.96

94

CASH FLOW STATEMENT FOR THE YEAR ENDED 31st MARCH, 2010 (Contd.)

2010 2009Rs. Lakhs Rs. Lakhs

C. Cash flow from financing activities :Proceeds from issue of share capital 28309.98 281.46

Dividend paid -6608.62 -6588.61

Proceeds from long term borrowings 93823.62 26487.68

Repayment of borrowings -58324.88 -16607.52

Interest paid (net) -18349.71 -13985.08

Net Cash from financing activities (C) 38850.39 -10412.07

Increase / (Decrease) in cash and cash equivalent (A+B+C) -1114.41 -33827.22Cash and cash equivalent at the beginning of the year 8797.48 42624.70Cash and cash equivalent at the close of the year 7683.07 8797.48

CONSOLIDATED ACCOUNTS

Auditors’ Certificate

We have verified the above Cash Flow Statement of The India Cements Ltd. and its Subsidiaries derived from theaudited Annual Financial Statements for the years ended 31st March, 2010 and 31st March, 2009 and found thesame to be drawn in accordance therewith and also with the requirements of Clause 32 of the Listing Agreementswith Stock Exchanges.

For P.S.SUBRAMANIA IYER & CO., For BRAHMAYYA & CO.,Chartered Accountants Chartered Accountants

G.HARIHARAN N.SRI KRISHNAPlace : Chennai Partner PartnerDate : 30th April, 2010 Membership No.15071 Membership No.26575

N.SRINIVASAN B.S.ADITYANVice Chairman & Managing Director ARUN DATTA

R.K.DASN.R. KRISHNAN

RUPA GURUNATH V. MANICKAMWholetime Director A. SANKARAKRISHNAN

N. SRINIVASANPlace : Chennai R. SRINIVASAN G.BALAKRISHNAN K.SUBRAMANIANDate : 30thApril, 2010 Joint President (Finance & Accounts) President & Company Secretary Directors

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