nandan exim limited - chiripal group · nandan exim limited ... shri vedprakash chiripal chairman...

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13TH ANNUAL REPORT 2006 - 2007

NANDAN EXIM LIMITED

Company Information

BOARD OF DIRECTORSShri Vedprakash Chiripal ChairmanShri Brijmohan Chiripal Managing DirectorShri Gautam C. Gandhi DirectorShri A. C. Patel Additional Director

Shri Deepak J. Chiripal Chief Executive Officer

Shri Jigar H. Shah Company Secretary

BANKERSState Bank of IndiaState Bank of HyderabadCorporation BankState Bank of SaurashtraSyndicate BankState Bank of PatialaOriental Bank of CommerceState Bank of TravancoreState Bank of MysoreUnited Bank of IndiaIndian BankKarur Vysya BankTamilnadu Mercantile BankBank of Maharashtra

CORPORATE OFFICE“Chiripal House”, B/h Arjun Tower,132, Ft. Ring Road, Shivranjani Cross Roads,Satellite Road, Ahmedabad - 380015.Tel : 91-079-26734660-2-3Fax : 91-079-26768656

COMMITTEES OF BOARD :-

AUDIT COMMITTEEShri A. C. Patel ChairmanShri Vedprakash Chiripal MemberShri Gautam C. Gandhi Member

REMUNERATION COMMITTEEShri A. C. Patel ChairmanShri Vedprakash Chiripal Member

SHAREHOLDERS GRIEVANCE COMMITTEEShri Gautam C. Gandhi ChairmanShri Vedprakash Chiripal Member

RIGHT ISSUE COMMITTEEShri Vedprakash Chiripal ChairmanShri Brijmohan Chiripal MemberShri A. C. Patel Member

AUDITORSM/s J.T. Shah & Co.,Chartered Accountants,201/202, Lalita Complex,Nr. Mithakhali Cross Roads,Navrangpura, Ahmedabad - 380 009

REGISTRAR & TRANSFER AGENTDatamatics Financial Software & Services Ltd.Plot No. A/16 & 17, MIDC, Part B,Crosslane, Marol, Andheri (E),Mumbai - 400 093Tel. No.: 022 2821 3383-90Fax No.: 022 2832 0382

REGISTERED OFFICE & PLANTSurvey No. 198/1, 203/2,Saijpur-Gopalpur, Pirana Road,Piplej, Ahmedabad - 382405

CONTENTS Page No.

Notice 2-3

Directors' Report 4-6

Annexure to Directors' Report 6-8

Management Discussion 9-10and Analysis Report

Corporate Governance 11-19

Auditors' Report 20-22

Balance-Sheet 23

Profit & Loss Account 24

Cash Flow Statement 25

Schedules forming part of Accounts 26-30

Note to Accounts 31-37

Balance-Sheet Abstract 38

Proxy 39

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NANDAN EXIM LIMITED

NOTICENotice is hereby given that the 13th Annual General Meeting of the Members of the Company will be held on Friday, the28th day of September 2007 at Registered office at 3.30 p.m. at Survey No. 198/1 & 203/2, Saijpur- Gopalpur, PiranaRoad, Piplej, Ahmedabad - 382 405, to transact the following business:-

ORDINARY BUSINESS:

1. To receive, consider and adopt the Audited Balance Sheet as at 31st March, 2007 and Profit and Loss Account for theyear ended on that date together with the Reports of the Directors’ and Auditors’ thereon.

2. To confirm and approve the payment of Interim Dividend declared by the Board of Directors as a total dividend forthe year ended 31st March 2007.

3. To appoint a Director in place of Shri Gautam C. Gandhi, who retires by rotation and being eligible offers himself forreappointment.

4. To appoint auditors to hold office from the conclusion of this Annual General Meeting up to the conclusion of thenext Annual General Meeting and to authorise the Board to fix their remuneration.

SPECIAL BUSINESS:

5. Appointment of Shri Ambalal C. Patel as a Director :-

To consider and if thought fit, to pass with or without modifications, the following as ORDINARY RESOLUTION.:

“ RESOLVED THAT THAT Shri A. C. Patel, Director who was appointed by the Board of Directors on 21st February, 2007as an Additional Director, pursuant to the provisions of Section 260 of the Companies Act, 1956 and in respect ofwhom the Company has received a notice from a member pursuant to the provisions of Section 257 of the CompaniesAct, 1956 proposing the candidature of Shri A. C. Patel, Director for his appointment as Director, be and is herebyappointed as Director of the Company liable to retire by rotation.”

6. Increase in Borrowing Limits :-

To consider and if thought fit, to pass with or without modifications, the following as ORDINARY RESOLUTION.:

“ RESOLVED THAT pursuant to the provisions of Section 293 (1) (d) of the Companies Act, 1956 and other applicableprovisions, if any, of the Companies Act, 1956, the consent of the Company be and is hereby accorded to the Boardof Directors of the Company for borrowing from time to time any sum or sums of monies, which, together with themonies already borrowed by the Company ( apart from temporary loans obtained or to be obtained from the company’sbankers in the ordinary course of business ), may exceed the aggregate of the paid up capital of the Company and itsfree reserves, that is to say reserves not set apart for any specific purpose, provided that the total amount soborrowed by the Board of Directors shall not at any time exceed the limit of Rs.1000 crores (Rupees One ThousandCrores only).”

NOTES:

1. A MEMBER IS ENTITLED TO ATTEND AND VOTE IS ENTITLED TO APPOINT A PROXY TO ATTEND AND VOTE INSTEAD OFHIS/HER SELF AND PROXY NEED NOT BE A MEMBER.

IN ORDER THAT THE PROXIES TO BE EFFECTIVE, THE PROXY FORMS SHOULD BE DEPOSITED AT THE COMPANY’SREGISTERED OFFICE ON OR BEFORE 48 HOURS FROM THE DATE OF HOLDING OF THE MEETING.

2. The relative Explanatory Statement pursuant to section 173(2) of the Companies Act, 1956 in respect of the businessunder Item Nos. 5 & 6 set out above are annexed hereto.

3. Members are requested to notify changes in address, if any, immediately to the Company at its registered officequoting their Folio Numbers.

4. All documents referred to in the accompanying Notice and the Explanatory Statement are open for inspection at theRegistered Office of the Company during office hours on all working days except Sundays between 11.00 a.m and 1.00p.m, upto the date of the ensuing Annual General Meeting.

5. Members / Proxies should fill the Attendance Slip for attending the Meeting; Members who hold shares in dematerializedform are requested to bring their Client ID and DP ID Number for easy identification for attendance at the Meeting.

6. Members are informed that in case of joint holders attending the Meeting, only such joint holder who is higher inorder of the names will be entitled to vote.

7. The Register of Members and Share Transfer Books of the Company will remain closed from Monday 24th September,2007 to Tuesday 25th September, 2007 (both days inclusive).

By Order of the Board of Directors

Date : 26/07/2007 Jigar H. ShahPlace : Ahmedabad Company Secretary

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NANDAN EXIM LIMITED

EXPLANATORY STATEMENTThe Explanatory Statement, pursuant to section 173 (2) of the Companies Act, 1956 sets out all material facts relating tothe business mentioned at item nos. 5 & 6 of the accompanying notice.ITEM NO. 5The Board of Directors at their meeting held on 21st February 2007 appointed Shri A. C. Patel as an additional director ofthe Company. The office of the Additional Director ceased to be exit at the ensuing Annual General Meeting of theCompany.The Company has received a notice from a member under Section 257 of the Companies Act, 1956, about his intention topropose the candidature for the appointment of Shri A. C. Patel as the Director of the Company.Shri A. C. Patel is an Engineer (Metallurgy) and having wide experience in the field of project evaluation & development,project finance and having experience of liaison with Government and Semi Government Department. He is expert inproviding advice in the field of commercial and capital market and he is on the board of reputed organizations.The approval of the members is accordingly sought for the appointment of Shri A. C. Patel as the Director of the Companyliable to retire by rotation.As the matter concerns Shri A. C. Patel, may be considered as interested in the passing of the said resolution.Your Directors recommended his appointment and request to approve the above resolution.None of the Directors is in any way concerned or interested in the proposed resolution except Shri A. C. Patel.ITEM NO. 6Pursuant to Section 293 (1) (d) of the Companies Act, 1956 the Board of Directors of a Company cannot, except with theconsent of the company in general meeting, borrow monies, (apart from temporary loans obtained from the company’sbankers in the ordinary course of business) in excess of the aggregate of the paid-up capital and free reserves of thecompany, that is to say, reserves not set apart for any specific purpose. The Members, at the Extra Ordinary GeneralMeeting of the company held on 1st May 2004 had accorded their consent to the Board of Directors borrowing upto Rs.500 Crores. To meet the capital expenditure for expansion project and for future Projects/Planning, and also to provide forthe issue of any debt/ debt related instruments in the Indian and/or international market, it is necessary to enhance thepresent borrowing limit. The Members’ approval is therefore being sought pursuant to section 293(1) (d) of the Act toincrease the borrowing limit to Rs. 1000 crores.The Directors, recommend the resolution at Item No. 6 of the accompanying Notice for approval by the Members.None of the Directors is in any way concerned or interested in the proposed resolution..

By Order of the Board of Directors

Date : 26/07/2007 Jigar H. ShahPlace : Ahmedabad Company Secretary

Brief resume and other information in respect of Shri A. C. Patel (Additional Director) Non Executive Directorseeking re-appointment at the Annual General Meeting:

Shri A. C. Patel aged about 64 years. He is Bachelor of Engineering (Metallurgy). He has wide experience as well asknowledge of Technical, Project Finance matters. He also worked as a Nominee Director in various Companies. He is asindependent Director on the Board of the Company.

He is a member of the following committee of the Board of Directors of the Company:

1. Audit Committee

2. Remuneration Committee

3. Right Issue Committee

Brief resume and other information in respect of Shri Gautam C. Gandhi Non Executive Director seeking re-appointmentat the Annual General Meeting:

Shri Gautam C. Gandhi aged about 71 years. He is Practicing Advocate. He has wide experience as well as knowledge ofLegal, Finance matters. He also worked as a Nominee Director in various Companies. He is a partner of Legal firmC.C. Gandhi & Co. at Ahmedabad. He is an independent director on the board of our Company.

He is a member of the following committee of the Board of Directors of the Company:

1. Audit Committee

2. Share Holders' Grievance Committee

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NANDAN EXIM LIMITED

DIRECTORS' REPORT

To,The MembersNANDAN EXIM LIMITED.

Your Directors have pleasure in presenting the 13th Annual Report together with the Audited Statement of Accounts forthe year ended on 31st March 2007.

FINANCIAL HIGHLIGHTS:-

(Rs. In Lacs)

FINANCIAL RESULTS Current Year Previous Year2006-07 2005-06

Amount (Rs.) Amount (Rs.)

Sales 22195.05 12,873.13

Profit Before Depreciation 2861.02 2369.49

Less - Depreciation 805.99 496.61

Profit After Depreciation 2055.03 1,872.88

Less - Provision For Taxation 176.50 257.10

Less - Provision For Deferred Tax 586.45 376.75

Profit After Taxation 1292.08 1,239.03

Less: Prior Period Items 2.77 (2.01)

Less: Short/(Excess) provision of Income Tax (27.86) 26.89

PROFIT FOR THE YEAR 1317.17 1214.15

Appropriations / Adjustments

Balance of profit / (loss) brought forward 1578.56 722.81

Interim Dividend 113.87 104.25

Proposed Final Dividend — 104.25

Corporate Dividend Tax (including cess and surcharge) 15.97 29.90

General Reserves 115.00 120.00

Profit carried to Balance Sheet 2650.89 1578.56

PERFORMANCE:

During the year under review, the Company has achieved its target by showing excellent performance by touching all timehigh turnover of Rs 221.95 crores as compared to a previous year’s turnover of Rs.128.73 crores. This shows a rise of72.42% over the previous year. The Gross Profit for the year ended 31.03.2007 has reached to Rs. 28.61 crores showinga jump of 20.76 % over the previous year’s figures of Rs. 23.69 crores for the year 31.03.06. The Net profit during the yearunder review has increased to Rs. 12.92 crores as compared to Rs. 12.39 crores for the year ended 31.03.2006 whichshows the rise of 4.2 % over the previous year. The Company could achieve its target as per the projection by maximumutilization of available resources, effective planning & management. During the year, the Company was executing variousprojects framed by the Management and looking to the various projects on hand, and future goals framed by the Management,your Directors expect bright future in the coming years.

DIVIDEND:

During the year under review, the Board of Directors had declared the Interim Dividend of 7.5% on Equity Shares and paidto the Shareholders as per the record date. Further, your Directors hereby inform that the Company is implementing theExpansion Project and the Internal Cash Accruals has been taken as a part of sources of finance to the expansion project,which has been approved by the bankers and consequently the Company is required to plough back the profit for theexpansion project and other projects on hand. So, the Board of Directors has not recommended Final Dividend on EquityShares for the year under review and your Directors request the shareholders to approve the total dividend of 7.5% (beingthe Interim dividend ) on Equity Shares for the year ended 31.03.2007.

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NANDAN EXIM LIMITED

EXPANSION PROJECT:-

The Company is implementing an expansion project for the increase in the existing manufacturing capacity from 20 LacsMtr. P.A to 40 Lacs Mtr. P.A., installation of 15 MW Captive Power Project and Spinning Project at a Project cost of Rs.327crores, which is financed through a Term Loan of Rs.243 crores and balance by way of Promoters Contribution by way ofEquity and Right Issue. It is our great pleasure to inform you that the Company has already commissioned Third Line ofDenim by increasing existing capacity from 20 Lacs Mtr p.a. to 30 Lacs Mtr p.a. and one unit of Spinning Project hasalready been commissioned. The installation of 15 M W. Captive Power Project is under implementation and it is expectedto implement the project as per the revised schedule fixed by the Company. Further, the Company has filed Draft Letter ofOffer with SEBI and your Directors hope to get the SEBI Clearance very soon.

BONUS SHARES:-

Your Directors are pleased to inform you that the Company had declared the Bonus Shares to the shareholders in the ratioof 1:1 during the year under review by capitalizing the reserves. Your Directors convey the regards to the shareholders forthe continuous support and trust extended to the Company

RIGHT ISSUE OF EQUITY SHARES:-

It is a great pleasure of your Directors to inform that your Company is coming out with the Rights Issue to Equity Sharesat a price of Rs.3/- per share including a premium of Rs.2/- per share on right basis in the ratio of one Equity Share forevery two Equity Shares held by the shareholders as on record date to be decided by the Board for the total amount ofRs.45.54 crores. Your Directors are pleased to inform you that the Company has already filed the Draft Letter of Offer forthe proposed Rights Issue of the Equity Shares with SEBI and your Company expect to get final clearance from SEBI veryshortly.

PUBLIC DEPOSIT:-

Your Company has not accepted any deposits u/s 58A of the Companies Act, 1956 during the year under review.

COVERAGE OF ASSETS:-

Adequate Insurance Cover for the risk on the fixed assets of the Company including entire Plant & Machinery, Building,Stock etc. have been taken during the year under review and it is renewed regularly taking into the consideration ofvarious factors and it is sufficient to take care of any unforeseen situation.

PREFERENTIAL ISSUE OF EQUITY SHARES:-

The Company, during the year under review made a preferential issue of Equity Shares to the promoters, as per SEBI (DIP)Guidelines 2000 and their regulation thereto as a part of Means of Finance of the expansion project and the equity shareshas been listed on BSE and NSE.

CORPORATE GOVERNANCE:-

The Company believes that the corporate governance is the part of its responsibility to adhere the requirement of law andis added to application of Management Practice, Compliance with Law and also adherence to ethical standards anddischarge of social responsibilities.

Corporate Governance Report as well as Corporate Governance Compliance Certificate is provided as separate annexure ofthis report.

DIRECTORS:-

Shri Gautam C. Gandhi, Director who retires by rotation during the year under review, offers himself for reappointment.Your Directors recommend his reappointment.

PARTICULARS OF EMPLOYEES:-

There was no Employee drawing remuneration exceeding ceiling prescribed under section 217 (2A) of the Companies Act,1956. Therefore, no separate report has been annexed

DIRECTORS RESPONSIBILITY:-

In accordance with the provision of Section 217(2AA) of the Companies Act 1956 and based on the information providedby the Management, your Directors state that;

a) In the preparation of the annual accounts, the applicable accounting standards have been followed along withproper explanation relating to material departures;

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b) They have selected such accounting policies and applied them consistently and made judgments and estimates thatwere reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March,2007 and of the profit of the Company for the year ended on that date;

c) Proper and sufficient care has taken for the maintenance of adequate accounting records in accordance with theprovisions of the Companies Act, 1956, for safeguarding the assets of the Company and for preventing and detectingfraud and other irregularities;

d) The annual accounts of the Company have been prepared on a going concern basis.

AUDITORS:-

M/s. J.T. Shah & Co. Chartered Accountants, Ahmedabad will retire at the ensuing Annual General Meeting of the companyand being eligible offers themselves for reappointment. Your Directors recommend their reappointment for the currentyear.

ACKNOWLEDGMENT:-

Your Directors would like to acknowledge with gratitude, the support and co-operation extended by shareholders, suppliers,banks and financial institutions and look forward to their continued support, we appreciate the continued co-operationreceived from various regulatory authorities, Department of Company Affairs, Registrar of Companies, Reserve Bank ofIndia, Securities and Exchange Board of India, Stock Exchanges and Depositories. We also recognize and appreciate thesincere had work, loyalty and efforts of the employees and look forward to their continued support.

FOR AND ON BEHALF OF THE BOARD

Place : Ahmedabad VEDPRAKASH CHIRIPALDate : 26/07/2007 CHAIRMAN

ANNEXURE TO DIRECTORS’ REPORT

ANNEXURE-1

Particulars pursuant to Section 217 (1)(e) of the Companies Act, 1956 read with Companies (Disclosure of particulars inthe Report of Board of Directors) Rules, 1988 and forming part of the Report of the Directors.

A. CONSERVATION OF ENERGY:

[a] Energy conversion measures taken :-

1) Installation of new high capacity HT compressor in place of Four less capacity compressors to reduce overallspecific power consumption.

2) Installation of condensate collection system and booster pump to recover almost 95 % from 70 % Hotcondensate from the process of 90-95°C.

3) Optimization of Humidification plant by air balancing from inlet and outlet fans.

Water conservation Measures taken

Reduced wastages of water by providing orifices in pipelines for construction activities reduced the pumpoperation by 4-5 Hrs.

[b] Additional investments and proposals, if any, being implemented for reduction of consumption of energy:-

To install variable frequency drive in ID fan & FD fan to reduce power consumption.

[c] Impact of measures at (a) and (b) above for reduction of energy consumption and consequent impact onthe costly of production of goods:-

1) The Power consumption reduced to the tune of 4000-4500 kWh/Day.

2) Lignite consumption reduced to 2 - 2.2 MT/Day

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NANDAN EXIM LIMITED

[d] Total Energy Consumption and energy consumption per Unit of Production.

I. POWER & FUEL CONSUMPTION

Power and Fuel Consumption: 31.03.2007 31.03.2006

1. Electricity

a) Purchased

Unit (kwh) 18467816 14965000

Total Amount 68325730 57615250

Rate / Unit (Rs.) 3.70 3.85

b) Own Generation:

i. Through Diesel Generator

Unit (kwh) NIL NIL

Unit per Ltr of Diesel Oil NIL NIL

Cost / Unit (Rs.) NIL NIL

ii. Through Steam Turbine/Generator

Unit (kwh) NIL NIL

Units per Ltr of Fuel Oil / Gas NIL NIL

Cost / Unit (Rs.) NIL NIL

2. LIGNITE

Quantity (Tones) / Day 42.94 24

Total Cost (Rs.) 22077446 38856

Average Rate (Rs.) 1408.63 1619

3. COAL

Quantity (Tones) / Day 1.23 NIL

Total Cost (Rs.) 1425500 NIL

Average Rate (Rs.) 3173.42 NIL

4. Furnace Oil

(Used in the Generation of Steam)

Quantity (K. Liters) NIL NIL

Total Amount (Rs.Lakhs) NIL NIL

Average Rate (Rs.) NIL NIL

5. Others LSHS (Low Sulpher High Stock)

(Used in the Generation of Steam)

Quantity (Tones) NIL NIL

Total Cost (Rs.Lakhs) NIL NIL

Rate / Unit (Rs.) NIL NIL

II. CONSUMPTION PER METER OF PRODUCTION:

Electricity (KWH) Per Meter 0.93 0.91

Furnace Oil NIL NIL

Coal (Specified Quality) 0.02 NIL

LIGNITE (KG) Per Meter 0.79 0.45

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B. TECHNOLOGY

I. RESEARCH AND DEVELOPMENT (R & D)

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

During the year under review, the company mainly focused on development of new products to cater todifferent market segments and specific customers’ needs apart from establishing existing products. Inaddition, research and optimization of process parameters at all processes were carried out. The companyhas also put-up a spinning plant having capacity to produce about 25 MT yarn per day as an efforts towardbackward integration for getting in-house regular specialty yarn.

2. Benefits derived as a result of the Above R & D

(1) We had developed 646 products, in the year out of which 262 products were commercialized. This hasresulted in getting valued customers not only in domestic market but in export too.

(2) Optimization of process parameters had benefited in achieving higher productivity, better freshpercentage as well as reduction in wastes across processes.

(3) Able to produce and maintain continuity in product and also deliver the required matching sample tothe customer

(4) In-house production of yarn will lead to continuity/regularity in quality, timely delivery to customernot only of regular variety but fabric manufactured out of special yarn like slub yarn, multi count yarnetc.

3. Future Plan of Action

To develop system based inspection of various machines, their conditions and processes to enable preventiveactions to be taken. To develop problem solving skills and multi skill in workers and shop floor supervisors.To procure latest testing equipment like afis for cotton and in process testing of spinning to get better andconsistent quality.

II. TECHNOLOGY ABSOPRPTION, ADOPTION AND INNOVATION

Efforts made towards Technology, Absorption, Adoption and Innovation:-

Technology to process fine count yarns in Slasher Indigo dyeing was absorbed during this year. Wet finishingtechnology for denims was introduced. High speed Looms with invertors were procured which enables infinitespeed adjustments. The company has purchased Tax cad design software for development of various fabrics andgarment, reproduction and matching of customers’ required sample.

Benefits derived:

Fine counts yarns for shirting can be dyed on the slasher dyeing machines. Denim will have a much better look(flat) and have soft feel compared to foam finished denims. Looms with invertors will allow adaptation ofoptimum speeds for various special yarns such as slub yarns, elastomeric yarns without any loss of down time.

Future Plan of Action.

(1) To Implement system based management information system(SAP) for the entire company which will allowreal time information and optimum use of man ,machine and materials.

(2) Measurement and hatching of waste generation and gradually reduction in waste value loss.

(3) Training of employees for updation and up gradation of their skill and knowledge for improving the efficiencyand quality

FOREIGN EXCHANGES EARNINGS AND OUTGO:

a. The Company has taken various steps to increase exports of products during the year.

b. Foreign exchange earning and outgo during the year:

Particular 31.03.2007 31.03.2006(Rs. in Crs.) (Rs. in Crs.)

(a) Foreign Exchange Earnings: 40.60 18.53

(b) Foreign Exchange Outgo: 1.26 0.23

Total Foreign Exchange Used and earned: - As per notes on account.

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MANAGEMENT’S DISCUSSION AND ANALYSIS

1. Industry Structure and Developments:

Denim is one of the important parts of the Textile Industry, which has evidenced a rapid growth in the last few years.The Word Denim now-a-days widely known and in use among the people in India and of course Overseas Country. Ithas become more popular and is widely used in rural segment also. In Indian Economy, the demand of the Denim hadincreased tremendously due to rapid growth during the past years and over-all performance of all Denim Industriesremained at high level and consistent to match with the demand. However all the players and new entrance increasedtheir capacity much higher to avail the benefit of the growth of the economy resulting in excess supply of the Denimin the Market loading into stiff competition among the players and putting heavy pressure on the price of the Denim.The year 2006-07 was challenging year for the Company in such market scenario and your Company has even madesignificant progress by achieving high turnover due to its inherent strength and progressive future planning of thegroup in the market. The Company has long term goals to strengthen their presence in the Denim as well as in theover all Textile Structure as a group to achieve these goals. The Company has planned to become a fully IntegratedDenim Industry by undertaking backward and forward integration by manufacturing of Cotton Yarn to garmenting.Your Company has already started this expansion project and the production of In-house Cotton Yarn and Ready MadeGarments in Denim has already started, which are considered to be non-dependence for the steady supply of the rawmaterial for better quality of the finished products and value added area of garmenting which will increase the valueof the products resulting into better realization. The Company is in better position to grow as per the market andachieve the goals envisaged in such scenario. The Company is also developing its new areas of global market in theDenim Industry and is putting hundreds of varieties of the products to market and cope up with the latest demand ofboth, Domestic and International Market. Looking to the strength, demand and supply and the industry future, yourCompany foresee a reasonable growth in such scenario.

2. Opportunities:

Denim Industries is slowly picking up as compared to the recent past slow down in the market entering in to the fieldof garmenting and better quality of the products and variety of ranges in the Denim. The Company foresee goodmarket demand of the products which shall give a high value to the Company.

Further, with opening of new area of demands in Rural Area and mainly its wide use in all Sectors of the society andthe marketing Network established by the Company, the Company is definitely going to get good opportunities in thecoming year, which will strengthen the growth of the Company.

3. Challenges:

Every business carried out by any entrepreneurship are full of challenges and risk and the success of any businessalways depend upon the ability of the Company how it faces the challenges and survive in the highly competitivemarket. The Company has developed various systems and strategies to face the challenges of the competitors. TheChallenges are from the existing players and also from the newcomers. However, the Company has very little effect ofthe challenges due to high quality products, good marketing network and variety of products and its ranges andfrequent change in the designs and pattern commensurate with the changing demand. Further, the Company hasdeveloped new segment of the consumers along with entering into garmenting and by putting the latest sophisticatedmachineries and created the brand name which has facilitated the Company to show satisfactory performance in suchscenario.

4. Outlook:

The Company is having cautious outlook in its near term revenue and earning and it focused towards downstreambusiness of garmenting and branded products in retail segment. Further, it is also putting up hundreds of varieties inthe market by developing its own net work and carrying out research and development activities. Further, substantialinvestment have been made in resources and people to create an effective front end for fabric activities as well as tocreate varieties of products by differentiating with other products in the market. This will add to yield results in thecurrent as well as coming years, the Company is cautious about the recent past trend of the Denim Industries andhave taken reasonable steps to achieve the targeted goals.

5. Internal Control and their Adequacy:

Nandan Exim Limited has comprehensive systems and procedural guidelines concerning all operational areasencompassing tendering, building, execution, quality, safety, procurement, finance, accounts & audit, human resource

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etc., which are adequate and commensurate with the size and level of operation of the Company. The managementhas been making constant efforts to review and upgrade existing system and processes to gear up and meet with thechanging needs of the business

6. Financial Review:

The Company has achieved highest turnover of Rs. 221.95 crore for the Financial Year ended 31.03.2007 as comparedto previous year turnover of Rs. 128.73 crore reporting 72.42% raise then the previous year. The gross profit for theyear under review was Rs. 28.61 crore as against Rs. 23.69 crore for the previous year ended on 31.3.2006. The NetProfit for the year was Rs. 12.92 crore as compared to previous year profit of Rs. 12.39 crore.

7. HUMAN RESOURCES AND INDUSTRIAL RELATIONS:

One of the key features of any growing business is the recruitment and retention of human resources. The Companyaims to build a culture and environment that supports professional entrepreneurship and is built on the core philosophyof being customer centric by creating and sharing value with all our stakeholders. The Company has successfullymanaged the important challenge of acquisition of talent to keep pace with the rapid expansion and demands ofspecialized business. The Company has been successful in achieving this during the year under review.

The Industrial Relations Climate was cordial during the current fiscal. The Company provides required trainings to theEmployees / Workers to improve their expertise and provides suitable atmosphere and platform to increase theefficiency of the staff. Over-all relations were cordial and Industrial harmony were maintained during the year underreview.

8. Risk Management:-

The Company is having effective strategy and system to safeguard it against wide range of risks. The Managementconceives various elements and analysis the Risk involved and take effective steps to reduce the risk against thebusiness of the Company. Further, it also takes necessary steps to safeguard against irreparable loss to the Companyagainst the unforeseen risk and adequate by covers assets of the Company during the course of business. TheManagement system is reviewed periodically and suitable changes are made depending upon the risk prevailing in themarket.

9. Cautionary Statement:

Statements in this Management’s Discussion and Analysis detailing the Company’s objectives, projections, estimates,expectations or predictions may be “forward – looking statements” within the meaning of applicable securities lawsand regulations. Actual results could differ materially from those expressed or implied. Important factors that couldmake a difference to the Company’s operations include economic conditions affecting demand/supply and pricecondition in the domestic markets in which the Company operates, changes in the Government regulations, tax lawsand other statutes and other incidental factors.

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NANDAN EXIM LIMITED

REPORT ON CORPORATE GOVERNANCE

Corporate Governance is a corporate discipline extended to transparency, integrity and accountability towards, allstakeholders, Corporate Governance helps to achieve excellence to enhance stakeholders value by focusing on long-termvalue creation without compromising on integrity, social obligations and regulatory compliances.

1) COMPANY’S PHILOSOPHY ON CORPORATE GOVERNANCE

At Nandan Exim Ltd, our continued endeavour is to achieve good governance, by way of conscious efforts wherebyensuring the truth, transparency, accountability and responsibility in all our dealings with our employees, shareholders,consumers and the community at large.

The Board of Directors represents the interest of the Company’s stakeholders, for optimizing long-term value by wayof providing necessary guidance and strategic vision to the Company. The Board also ensures that the Company’smanagement and employees operate with the highest degree of ethical standards.

We, at Nandan Exim Ltd, believe that the constant efforts to improve operational performance, guided by our values,from the basis for good Corporate Governance. Corporate Governance is strongly driven by our value such as commitment,quality customer orientation and integrity.

2) BOARD OF DIRECTORS

Composition

Your Company’s Board consists of 4 (Four) directors of which 2 are Executive and Promoter Directors and 2 are Non-Executive and Independent Directors. The Chairman of the Board is Executive Promoter Director. The composition ofthe Board of Directors was in compliance of revised clause 49 of the listing agreement. The composition of the boardis as under:-

Name of Directors Status I.e. Executive, Numbers of Number of Membership inNon-Executive Board Meetings other Boards or other Committeesand Independent as a Member or Chairman

Held Attended Board Committee Other Whetherduring during Director attended

the year the Year Ship last AGM

Shri Vedprakash D. Chiripal Promoter, 18 16 2 4 2 YesExecutive (Chairman)

Shri Brijomhan D. Chiripal Promoter-Executive 18 16 2 1 2 Yes

Shri Gautam C. Gandhi Non - Executive 18 12 1 2 1 —& Independent

Shri A. C. Patel* Non-Executive 18 2 9 3 9 —(Additional Director) Director

Shri D. K. Jain* Non-Executive 18 10 — 2 — —Director

Shri S. T. Shah* Non-Executive 18 7 — 2 — YesDirector

(*) During the year Shri A. C. Patel has been appointed as an Additional Director of the Company w.e.f. 21stFebruary, 2007.

(*) Shri D K Jain has resigned w.e.f. 21st February, 2007 and Shri S T Shah has resigned on 2nd March, 2007

None of the Directors of Board is a member of more than 10 Committees and no Director is the Chairman of more than5 committees across all the companies in which he is a Director. The necessary disclosures regarding Committeepositions have been made by all the Directors.

BOARD MEETINGS

The Board normally meets once or twice in a quarter. Additional meetings are held as and when required during theyear under review. The Board of Directors of Nandan Exim Ltd met 18 times, on 26.04.2006, 25.05.2006, 03.06.2006,06.07.2006, 29.07.2006, 17.08.2006, 24.08.2006, 30.08.2006, 20.09.2006, 05.10.2006, 31.10.2006, 29.11.2006,03.01.2007, 30.01.2007, 16.02.2007, 21.02.2007, 02.03.2007 and 15.03.2007. The gap between any two meetingsdid not exceed 4 months.

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NANDAN EXIM LIMITED

BOARD MEETING, COMMITTEE MEETING AND PROCEDURES

A. In order to setup the systems and procedures for the matter requiring discussions/ decisions by the Board, theBoard of Directors has framed guidelines for the meeting of Board of Directors and Committee thereof. The saidGuidelines seek to systematize the decision making process at the meetings of Board/Committees, in mostefficient manner.

B. Scheduling and selection of Agenda Items for Board Meeting.

i) The Company holds minimum of four Board Meetings in each year, which are pre-scheduled after the end ofeach financial quarter. Apart from the four pre-scheduled Board Meetings, additional Board Meetings willbe convened by giving appropriate notice at any time to address the specific needs of the Company. TheBoard may also approve permitted urgent matters by passing resolutions by circulation.

ii) The meetings are usually held at the Company’s Registered Office / Corporate office at Ahmedabad.

iii) All divisions/departments in the Company are encouraged to plan their functions well in advance, particularlywith regard to matters requiring discussions/approval/decision in the Board/Committee Meetings. All suchmatters are communicated to the Company Secretary in advance so that the same could be included in theAgenda for the Board Meetings.

iv) The Board is given presentation covering Finance, Sales and Marketing, and the major business segmentsand operation of the Company, before taking on record the results of the Company for the precedingfinancial quarter at each of the pre-scheduled Board Meeting. The Board’s annual agenda includesrecommending dividend keeping in view the dividend policy, determining directors who shall retire byrotation and recommending appointment of Directors/Auditors, authentication of annual accounts andapproving Directors Report, long term strategic plan for the Company and the principal issues that theCompany expects to face in the future, Board Meetings also note and review functions of its Committees.

v) The Chairman of the Board and the Company Secretary in consultation with other concerned persons in thesenior management, finalise the agenda papers for the Board Meetings.

BOARD MATERIAL DISTRIBUTION WELL IN ADVANCE:

1) Agenda papers are circulated to the Directors, well in advance, as per Agenda format. All material information isincorporated in Agenda papers for meaningful and effective discussions at the meeting. In case, any papers /document to the agenda is not possible to attach the same are placed on the table at the meeting with thespecific reference in the agenda.

2) In case of urgency, additional item(s) in agenda are permitted with the permission of chair and in that case thesubject matter discussion may be discussed at the meeting without written material being circulated in advance.

3) The members of the Board have access to all information of the Company and are free to recommend inclusionof any matter in the agenda for discussion.

MINUTES OF PROCEEDINGS OF BOARD MEETING:

The Company Secretary records the minutes of the proceedings of each Board and Committee Meetings. Draft minutesare circulated to all the members of the Board for their comments.

3) COMMITTEES OF BOARD:

AUDIT COMMITTEE:

The Audit Committee comprises of 3 members represented by 2 Non Executive Independent Director and 1 ExecutivePromoter Director. The Committee was reconstituted due to resignation of Shri S T Shah and Shri D K Jain, IndependentDirectors during the year under review.

• Shri A C Patel, acts as Chairman of the Committee and Shri Vedprakash D. Chiripal and Shri Gautam Gandhi as amember of the Committee.

Broad Terms of Reference

The Broad terms of reference as laid down by the board include the following requirement contained in the Clause 49of the Listing Agreement and Section 292A of the Companies Act, 1956.

• Oversight of the Company’s financial reporting process and the disclosure of its financial information to ensurethat the financial statement is correct, sufficient and credible.

• Recommending to the Board, the appointment, re-appointment and, if required, the replacement or removal ofthe statutory auditor and the fixation of audit fees.

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NANDAN EXIM LIMITED

• Approval of payment to statutory auditors for any other services rendered by the statutory auditors.

• Reviewing with the management, the annual financial statements before submission to the board for approval,with particulars reference to:

• Matters required to be included in the Directors Responsibility Statement to be included in the Boards report interms of Clause (2AA) of section 218 of the Companies Act, 1956.

• Changes, if any, in accounting policies and practices and reasons for the same.

• Major accounting entries involving estimates based on the exercise of judgement by management.

• Significant adjustments made in the financial statements arising out of audit findings.

• Compliance with listing and other legal requirements relating to financial statements.

• Disclosure of any related party transactions.

• Reviewing, with the management, the quarterly financial statements before submission to the board for approval.

• Reviewing, with the management, performance of statutory and internal auditors, adequacy of the internalcontrol systems.

• Reviewing the adequacy of internal audit function, if any, including the structure of the internal audit department,staffing and seniority of the official heading the department, reporting structure coverage and frequency ofinternal audit.

• Discussion with internal auditors any significant finding and follow up thereon.

• Reviewing the findings of any internal investigations by the internal auditors into matters where three issuspected fraud or irregularity, or a failure of internal control systems of a material nature, and then reportingsuch matters to the Board;

• Discussing with statutory auditors before the audit commences, about the nature and scope of audit, as well ashaving post-audit discussion to ascertain any area of concern;

• To look into the reason for substantial defaults in the payment to the deposition, debenture holders, shareholders(in case of non payment of declared dividends) and creditors.

• The Audit Committee met Six times during the year under review, on 26.04.2006, 5.07.2006, 29.7.2006,31.10.2006, 30.01.2007 and 02.03.2007.

• The composition of Audit Committee and particulars are as under:

Name of Director Category / Status No. of Meetings Meetings attended

Shri A C Patel(*) - Chairman Non Executive Independent Director 6 1

Shri Vedprakash D. Chiripal Executive Promoter Director 6 4

Shri S. T. Shah(*) Non Executive -Director 6 4

Dr. D. K. Jain (*) Non Executive -Additional Director 6 4

Shri Gautam C. Gandhi Non Executive Independent Director 6 5

(*) Shri A C Patel was appointed as Chairman of the Audit Committee w.e.f. 02-03-2007.

(*) Dr. D K Jain had resigned as Member of the Audit Committee w.e.f. 21.02.2007 and Shri S T Shah hadresigned w.e.f. 2nd March, 2007.

REMUNERATION COMMITTEE

• The remuneration committee has been constituted to recommend/review the remuneration package of theManaging/ Whole time Directors based on performance and defined criteria.

• The remuneration policy is framed towards rewarding performance based on review of achievements from timeto time. The remuneration policy is also in inconsistency with the industrial scenario.

• The remuneration committee met once only on 29.11.2006 during the year under review to consider revisedremuneration package to Shri Brijmohan D. Chiripal, Managing Director of the Company.

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NANDAN EXIM LIMITED

• Composition of Remuneration Committee.

Sr. Name of the Director No. of meeting Nature of DirectorshipNo. held attended

1. Shri Vedprakash D. Chiripal 1 1 Executive, Promoter group

2. Dr. D.K. Jain 1 1 Non-Executive, Independent* Resign w.e.f 21/02/2007

3. Shri A.C. Patel -Chairman 1 — Non-Executive, Independent*Appointed w.e.f 21/02/2007

The remuneration committee met One time during the year under review viz., on 29.11.2006.

• Details of remuneration paid to directors for the year ended on March 31, 2007 are as follows:

Name of Director Sitting Fees Salaries & Perquisites Commission (Rs) Total (Rs)

Shri Brijmohan D. Chiripal — 18,00,000 — 18,00,000Shri Vedprakash D. Chiripal — — — —

Shri Gautam C. Gandhi 65,000/- — — 65,000/-

Shri Subodhchander T. Shah — — — —*Resigned w.e.f. 02.03.2007Dr. D. K. Jain — — — —*Resigned w.e.f. 21.2.2007Shri A. C. Patel — — — —**Appointed w.e.f. 21.2.2007

• Shri S. T. Shah and Shri D. K. Jain had voluntarily waived to receive the Sitting Fees.

DETAILS OF SHAREHOLDING OF DIRECTORS AS AT 31ST MARCH, 2007

Name of Director Allotment Of Bonus No. of shares %Shares as on held as on holding30/01/2007 31/03/2007

No. of Price perShares Share Rs.

Shri Brijmohan D. Chiripal 15,750,000 Rs. 1/- 31,500,000 10.37Shri Vedprakash D. Chiripal 15,750,000 Rs. 1/- 31,500,000 10.37Shri Gautam C. Gandhi NIL NIL NIL NILShri A C Patel** Appointed w.e.f. 21.2.2007 NIL Rs. 1/- 10,000 0.0032

SHAREHOLDERS’ / INVESTORS’ GRIEVANCE COMMITTEE.

1. The Company has constituted an investors relations committee comprising of 2 directors with chairman being anon-executive, non-promoter director.

2. The Committee looks into redressal of shareholders’ complaints like transfer of shares, non-receipt of balancesheet, non-receipt of dividend etc. The committee reviews the performance and recommends measures foroverall improvement in quality of investor services.

Composition of Shareholders/ Investors Relations Committee

Sr. No Name of the Director Designation in committee Nature of Directorship

1. Shri Gautam C. Gandhi, Chairman Non-Executive, Independent Director2. Shri Vedprakash Chiripal Member Executive, Promoter Director

During the year, the Company under review 4 Meeting were held on 26.04.2006, 29.07.2006, 30.10.2006, and30.01.2007. Shri S. T. Shah resigned w.e.f. 02/03/07.

During the year, the Company has received 10 complaints which were resolved in time and no complaints are pending.The status of complaints is periodically reported to the Committee.

The equity shares of the Company are compulsorily traded in electronic form on the stock exchanges and hence thehandling of physical transfer of shares is minimal. The Board has delegated powers for approving transfer and

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NANDAN EXIM LIMITED

transmission of shares and issue of duplicate shares to Shares Transfer Committee. The Share Transfer Committee met1 Time during the year. There were no pending transfer of equity shares as at 31st March, 2007.SHARE TRANSFER SYSTEMThe Company’s Registrar and Share Transfer Agents is M/s Datamatics Financial Services Limited., Mumbai. The shareslodged for physical transfer/transmission/transposition / rematerilisation are registered within the prescribed timeperiod if the documents are complete in all respects. The shares in dematerialised from are admitted for trading withNational Securities Depository Limited (NSDL) and Central Depository Services (India) Limited.RIGHTS ISSUE COMMITTEE.The Rights Issue Committee was constituted by Board of Directors in its meeting on January 30, 2007 consisting ofThree directors, One of them are Non-executive Independent Directors and Two Executive Promoter Director. TheCommittee would look into the matters relevant to the Rights Issue.

Composition of Rights Issue Committee

Sr. No. Name of the Director Designation in committee Nature of Directorship

1. Shri Vedprakash D. Chiripal Chairman Executive, Promoter Director

2. Shri Brijmohan D. Chiripal Member Executive, Promoter Director

3. Shri A.C. Patel Member Non-Executive, Independent Director(Appointed w.e.f. 21/02/07)

4. Shri S. T. Shah Resigned w.e.f. 02/03/07 Non-Executive, Independent Director

SUBSIDIARY COMPANY:-The Company has no Subsidiary Company.DISCLOSURESa. Basis of Related Party Transaction

For significant related party transactions refer to Point No. 16 of the Notes to the Account contained in financialstatements in this Annual Report.

b. Disclosure of accounting treatment in preparation of Financial StatementThe company has followed the guidelines of accounting standards laid down by the Institute of CharteredAccountant of India (ICAI) in preparation of its financial statements.

c. Details of non-compliance by the CompanyThe Company has complied with all the requirement of regulatory authorities. No penalty / structures wereimposed on the Company by Stock Exchange or SEBI or any statutory on any matter related to capital marketduring the last three years.

d. Remuneration of DirectorsThe disclosure on remuneration of Directors, pecuniary relationship or transactions with non-executive Directors,details of notice period, severance fees, no. of shares held by Directors etc. have been provided earlier under thehead “ Remuneration Committee” in this Corporate Governance Report.

e. ShareholdersThe information of Directors who are proposed to be appointed / re-appointed have been provided in Annexureto the Notice of Annual General Meeting to be held on 28th September 2007.

f. Management Discussion and AnalysisThe Management Discussion and Analysis Report have been separately given in this Annual Report as requiredunder Clause 49 of the Listing Agreement.

Information about last 3 Annual General Meetings:-

AGM / Date Venue Time No. of specialEGM resolutions passed

12th AGM September 28, 2006 Survey No. 198/1 , 203/2, Saijpur Gopalpur, 3.30 P. M. 3Pirana Road, Piplej, Ahmedabad - 382 405

11th AGM September 29, 2005 Survey No. 198/1 , 203/2, Saijpur Gopalpur, 4.00 P. M. 4 Pirana Road, Piplej, Ahmedabad - 382 405

10th AGM September 30, 2004 Survey No. 198/1 , 203/2, Saijpur Gopalpur, 11.00 A.M. 4Pirana Road, Piplej, Ahmedabad - 382 405

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NANDAN EXIM LIMITED

During year ended 31st March, 2007 there have been no resolutions passed by the company’s through postal ballot.

Extra Ordinary General Meeting(s) (EGMs) : During the year, Three Extra Ordinary General Meeting of the members ofthe Company were held on 18.09.2006, 14.10.2006 and 30.12.2006.

COMPLIANCE:

There has been no non-compliance of the provisions, requirements of Stock Exchanges, SEBI. No penalties/Strictureshave been imposed on the Company by the Stock Exchanges or SEBI or any other statutory authorities on any matterrelating to capital market.

POSTAL BALLOTThe Company has not passed any resolution through postal ballot during the years under reference, None of theresolutions proposed for the ensuing Annual General Meeting need to be passed through Postal Ballot.

CEO / CFO CERTIFICATIONAs per provision of Clause 49 of the Listing Agreement, the Managing Director have certified to the Board in compliancewith the Clause 49(V) regarding CEO / CFO certification.

CODE OF CONDUCTThe Board of Directors of the Company has laid down Code of Conduct for Directors and Senior Management. The Codeof Conduct is posted on the Company’s Website www.chiripalgroup.com. All Board members and Senior Managementpersonnel have affirmed compliance with the Code of Conduct for the year under review.

MEANS OF COMMUNICATION• Half Yearly report sent to each of shareholders : No.

• Quarterly Results

Which newspapers normally published in : The Economics Times

Financial Express.

Business Standard

Hindu Business Line

Any Web site, where displayed. : www.chiripalgroup.com

www.sebiedifar.nic.in

• Presentation made to Institutional Investors or to Analyst : No.

• Whether Management Discussion and Analysis Report : Yes.is a part of Annual Report or not

GENERAL INFORMATION FOR SHAREHOLDERS:-• ANNUAL GENERAL MEETING

DATE & TIME : 28/09/2007 at 3.30p.mVENUE : Survey No. 198/1, 203/2, Saijpur Gopalpur,

Pirana Road, Ahmedabad - 382 405

• Financial Calendar : (tentative & subject to change)(a) First Quarter Results : Last week of July’07

(b) Second Quarter Results : Last week of Oct.,07

(c) Third Quarter Results : Last week of Jan.’08

(d) Results for the year ending March 2008 : May/June 2008

• Date of Book Closure : Monday 24th September, 2007 to Tuesday 25th

September, 2007 (Both days Incl.)

• Dividend Payment Date : N.A.

• Listing on Stock Exchange : 1. The Bombay Stock Exchange Limited, (BSE)Mumbai

2. The National Stock Exchange of IndiaLimited (NSE), Mumbai

• Stock Code :

1. Bombay Stock Exchange Limited (BSE) : 532641

2. The National Stock Exchange of India (NSE) : NANDAN

• ISIN No. for NSDL and CDSL : INE 875G01022

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NANDAN EXIM LIMITED

MARKET PRICE DATA.

Monthly High and Low for the period April 2006 to March 2007.

BSE NSE

HIGH LOW HIGH LOW

April, 2006 16.20 12.00 15.85 12.00

May, 2006 16.50 13.80 16.85 14.40

June, 2006 15.50 10.65 15.50 11.20

July, 2006 13.50 10.90 13.35 11.00

August, 2006 12.65 11.29 12.65 10.60

September, 2006 16.06 11.41 16.05 12.00

October, 2006 19.25 14.88 18.55 14.95

November, 2006 16.55 9.70 16.75 9.80

December, 2006 11.65 6.12 11.80 6.20

January, 2007 9.30 4.25 9.45 4.50

February, 2007 5.39 3.60 5.15 3.60

March, 2007 3.79 2.80 3.80 2.80

Note 1. The Equity Shares of the Company has been listed at Bombay Stock Exchange Limited w.e.f. 13.6.2005 andNational Stock Exchange Limited w.e.f. 29.12.2005.

Distribution of Shareholding (As of 31st March, 2007)

No. of equity shares held No. of Folios/ Client id % No. Shares %

Upto 5000 26642 87.5978 37649617 12.3986

5001 - 10000 2075 6.8225 16092389 5.2995

10001 - 20000 930 3.0578 14082639 4.6376

20001 - 30000 273 0.8976 6981248 2.299

30001 - 40000 133 0.4373 4794003 1.5787

40001 - 50000 91 0.2992 4214716 1.388

50001 - 100000 145 0.4768 10425234 3.4332

100001 and above 125 0.411 209420530 68.9654

TOTAL 30414 100 303660376 100

No. of shareholders in physical mode 17 44133

No. of shareholders in electronic mode 30397 303616243

Shareholding Pattern (As of 31st March, 2007)

Sr No. Category No. of Shares % to Share Capital

A Promoters Holding

Individuals/HUF 138545000 45.62

Bodies Corporate 13097358 4.31

B Non Promoter holding

Financial Institution/Banks 1000 0.00

Bodies Corporates 56164308 18.49

Indian Public 94536583 31.11

Any Other ( Non Resident) 1316127 0.43

Total …. 303,660,376.000 100.00

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NANDAN EXIM LIMITED

DEMATERIALIZATON OF SHARES : As on 31st March, 2007, 99.98% Shares were heldin dematerialized form and balance 0.014 % shareswere held in physical form. The trading in theCompany’s Equity shares in compulsory indematerialized mode. In order to afford full liquidityand efficient transfer mechanism to the investorcommunity, the Company has tied up with NationalSecurities Depository Limited (NSDL) and the centralDepository Services (India) Limited (CDSL). Thusthe investors can exercise dematerialization andtransfer actions through a recognised DepositoryParticipant (DP) who is connected to NSDL or CDSL.Requests for Dematerialization of Physical sharesare processed and completed within an averageperiod of 15 days from the date of receipt ofdocuments provided that the same are in order.

Outstanding GDRs/ADRs/Warrants or any Convertible Not issuedInstruments, conversion dates and likely impact on equityPlant Locations : Survey No. 198/1, 203/2, Saijpur Gopalpur, Pirana

Road, Piplej, Ahmedabad - 382 405Registrar and Share Transfer Agent : Datamatics Financial Services Limited

A/ 16 & 17, Part B, Cross Lane, Marol,Andheri (East), Mumbai - 400 009.

Address for correspondence should be addressed to : [1] Jigar H. Shah, Company SecretaryNANDAN EXIM LIMITEDCorporate Office : Chiripal House,132ft Ring Road, Shivranjani Cross Road,Satellite, Ahmedabad 380 015Phone : 079- 26734660 Fax : 079-26768656Email :[email protected]

[2] Datamatics Financial Services LimitedUnit : Nandan Exim LimitedA/16 & 17, Part B, Cross Lane, Marol,Andheri (East), Mumbai - 400 093.Phone : 022- 28213383-92 Fax : 022-28320382Email : [email protected]

Shareholders holding shares in electronic mode should address all their correspondence to their respective DepositoryParticipant.

POLICY FOR PREVENTION OF INSIDER TRADINGIn compliance with SEBI regulation on Insider Trading the Company has framed comprehensive Code of Conduct forprevention of Insider Trading for its designated employees. The Policy laid down guidelines, which advise them onprocedures to be followed and disclosure to be made while dealing with Shares of the Company and cautioning themon consequences of violations.

MANAGING DIRECTOR / CEO'S DECLARATION ON CODE OF CONDUCTAs required under Clause 49 of the Listing Agreement CEO’s Declaration for Code of Conduct is given below:

To,The MembersNandan Exim LimitedAhmedabad

I, Brijmohan D. Chiripal, Managing Director of the Company declare that all Board Members and Senior Management of theCompany have affirmed compliance with the Code of Conduct.

For Nandan Exim Limited

Brijmohan D. ChiripalManaging Director

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NANDAN EXIM LIMITED

AUDITORS' CERTIFICATE ON REPORT OF CORPORATE GOVERNANCE

ToThe Members,Nandan Exim Limited,

We have examined the compliance of conditions of Corporate Governance by Nandan Exim Limited for the year endedMarch 31, 2007, as stipulated in Clause 49 of the listing agreement entered into the Stock Exchanges in India.

The compliance of conditions of Corporate Governance is the responsibility of the Management. Our examination waslimited to procedures and implementation thereof, adopted by the Company for ensuring the compliance of the conditionsof the Corporate Governance. It is neither an audit nor an expression of opinion on the financial statements of thecompany.

In our opinion and to the best of our information and according to the explanation given to us and the representationmade by the Directors and the Management, we certify that the Company has complied with the conditions of CorporateGovernance as stipulated in the above mentioned Listing Agreement.

As per the records of the Company and certificate issued by registrar, no investor grievances are pending for a periodexceeding one month against the Company.

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

For, J.T. Shah & Co.,Chartered Accountants

Place : Ahmedabad J. T. ShahDate : 26.07.2007 (Partner)

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NANDAN EXIM LIMITED

AUDITORS’ REPORT

To,The Members ofNANDAN EXIM LIMITEDAhmedabad

1. We have audited the attached Balance Sheet of NANDAN EXIM LIMITED as at 31st March, 2007 the Profit and Lossaccount and also the Cash Flow Statement for the year ended on that date annexed thereto (herein after referred toas financial statements). These financial statements are the responsibility of the Company’s Management. Ourresponsibility 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. These Standardsrequire that we plan and perform the audit to obtain reasonable assurance about whether the financial statementsare free of material misstatement. An audit also includes examining, on a test basis, evidence supporting the amountsand 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 statement presentation. Webelieve that our audit provides a reasonable basis for our opinion.

3. As required by the Companies (Auditors’ Report) Order, 2003 issued by the Company Law Board in terms of section227 (4 A) of the Companies Act, 1956, we enclose in the Annexure a statement on the matters specified in paragraphs4 and 5 of the said order.

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

(i) We have obtained all the information and explanations, which are to the best of our knowledge and belief, werenecessary for the purpose of our audit;

(ii) In our opinion, proper books of account as required by law have been kept by the Company so far as appearsfrom our examination of those books;

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

(iv) In our opinion, the Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this reportcomply with the accounting standards referred to in sub section (3C) of section 211 of the Companies Act, 1956;

(v) In our opinion and based on information and explanation given to us, none of the directors are disqualified ason 31st March, 2007 from being appointed as director of the company in terms of clause (g) of subsection (1)of section 274 of the Companies Act, 1956.

(vi) In our opinion and to the best of our information and according to the explanations given to us, the saidaccounts, read together with the notes thereon, give the information required by the Companies Act, 1956 inthe manner so required and give a true and fair view in conformity with the accounting principles generallyaccepted in India:

(i) In the case of the Balance Sheet, of the state of affairs of the Company as at 31st March, 2007;

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

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

FOR J. T. SHAH & COMPANYCHARTERED ACCOUNTANTS

(J. T. SHAH)Place : Ahmedabad PartnerDate : 30/06/2007 Memb. No. 3983

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NANDAN EXIM LIMITED

ANNEXURE TO THE AUDITORS REPORT

Referred to in paragraph 3 of our Report of even date to the Members of NANDAN EXIM LIMITED for the year ended 31stMarch, 2007

1. In respect of Fixed Assets:

a. The Company has maintained proper records showing full particulars including quantitative details and situationof Fixed Assets.

b. As per the information and explanations given to us, the management at reasonable intervals during the year inaccordance with a programme of physical verification, has physically verified the fixed assets and no materialdiscrepancies were noticed on such verification as compared to the available records.

c. In our opinion, the Company has not disposed off any major/substantial part of the fixed assets during the yearand the going concern status of the company is not affected.

2. In respect of its Inventories:

a. The inventory has been physically verified during the year by the management. In our opinion, the frequency ofverification is reasonable.

b. The procedures of physical verification of inventories followed by the management are reasonable and adequatein relation to the size of the Company and the nature of its business.

c. On the basis of our examination of the records of inventory, we are of opinion that the Company is maintainingproper records of inventory. The discrepancies noticed on verification between the physical stocks and booksrecords were not material.

3. In respect of loans, secured or unsecured, granted or taken by the company to/from companies, firms or other partiescovered in the register maintained under section 301 of the Companies Act, 1956.

a. During the year under audit, there was one party covered in the register maintained under section 301 of theCompanies Act, 1956 from whom the company has taken loan. The year end balance is amounting to Rs, 169.50Lacs and the maximum amount involved during the year was Rs. 169.50 Lacs.

b. In our opinion and according to the information and explanations given to us, in case of loans taken during theyear, the rates of interest, wherever applicable and other terms and conditions are not prima facie prejudicial tothe interest of the company.

c. The company has taken interest free loans hence the question of repayment of interest does not arise and incase of principal, the terms of repayment have not been stipulated.

d. As the terms of repayment of loans have not been stipulated, the question of overdue installments in respect ofthe same does not arise.

e. The company has granted unsecured loan of Rs. 302 Lacs to one party covered under section 301 of the CompaniesAct, 1956. The maximum amount involved is Rs. 275 Lacs and year end balance is Rs. 20 Lacs.

f. The rate of interest and terms on which the loans are granted are not prejudicial to the interest of the company.

g. As the terms of repayment of loans have not been stipulated, the question of overdue installments in respect ofthe same does not arise.

4. In our opinion and according to the information and explanations given to us, there are adequate internal controlprocedures commensurate with the size of the Company and the nature of its business with regard to purchases ofinventory, fixed assets and with regard to the sale of goods and services. During the course of our audit, no majorweakness has been noticed in the internal controls.

5. In respect of contracts or arrangements covered under Section 301 of the Companies Act, 1956:

a. Based on the audit procedures applied by us and according to the information and explanations provided by themanagement, we are of the opinion that the particulars of contracts or arrangements referred to in section 301of the Act, that need to be entered into the register maintained under section 301 have been so entered.

b. In our opinion and according to the information and explanations given to us, the transactions made in pursuanceof contracts or arrangements entered in the registers maintained under section 301 of the Act, in respect of any

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NANDAN EXIM LIMITED

party during the year have been made at prices which are reasonable having regard to prevailing market pricesat the relevant time.

6. The company has not accepted any deposits from public.

7. In our opinion, the Company has an internal audit system commensurate with the size and nature of its business.

8. We have broadly reviewed the books of account relating to materials, labour and other items of cost maintained bythe Company pursuant to the Rules made by the Central Government for the maintenance of cost records underSection 209 (1) (d) of the Companies Act, 1956 and we are of the opinion that prima facie the prescribed accountsand records have been made and maintained.

9. In respect of Statutory Dues:

a. According to the records of the company, by and large the company is regular in depositing with appropriateauthorities undisputed statutory dues including income tax, sales tax, wealth tax, custom duty, excise duty,service tax, cess and other statutory dues applicable to it except delay in few cases in deposit.

b. According to the information and explanations given to us, no undisputed amounts payable in respect of incometax, wealth tax, service tax, customs duty, sales tax and excise duty were outstanding as at 31st March, 2007 fora year of more than six months from the date they became payable.

c. There are no statutory dues as at balance sheet date that have not been deposited on account of dispute.

10. The company has no accumulated losses and has not incurred any cash losses during the financial year under reviewor in the immediately preceeding financial year.

11. Based on our audit procedure and according to the information and explanations given to us, we are of the opinionthat the Company has not defaulted in repayment of dues to Banks.

12. Based on our examination of documents and records and information and explanations given to us, the Company hasnot granted any loans and advances on the basis of security by way of pledge of shares, debentures and othersecurities.

13. The provisions of any special statute applicable to Chit Fund, Nidhi or Mutual benefit Fund/Societies are not applicableto the Company. Therefore, clause (xiii) of para 4 of the Companies (Auditor’s Report) Order, 2003 is not applicableto the company.

14. The Company is not dealing or trading in shares, securities, debentures or other investments and hence, the requirementsof clause (xiv) of para 4 are not applicable to the Company.

15. As per the information provided to us, the Company has not given any guarantee for loans taken by others from banksor financial institutions.

16. In our opinion, and according to the information and explanations given to us, on overall basis, the term loans havebeen applied for the purpose for which they were obtained.

17. On the basis of an overall examination of the Balance Sheet and Cash Flow Statement of the Company, in our opinionand according to the information and explanations given to us, no funds raised on a short term basis have been usedfor long-term purposes.

18. The Company has made preferential allotment of shares to parties and companies covered in the register maintainedunder Section 301 of the Companies Act, 1956 during the year, the same are not prejudicial to the interest of thecompany.

19. During the year, the company has not issued any debentures.

20. The company has not raised any money by public issue.

21. Based upon the audit procedures performed and information and explanations given by the management, we reportthat no fraud on or by the Company has been noticed or reported during the year.

FOR J. T. SHAH & COMPANYCHARTERED ACCOUNTANTS

(J. T. SHAH)Place : Ahmedabad PartnerDate : 30/06/2007 Memb. No. 3983

23


NANDAN EXIM LIMITED

BALANCE SHEET AS AT 31ST MARCH, 2007

Schedule As at As at31.03.2007 31.03.2006

(Rs.) (Rs.)

SOURCES OF FUNDSShareholders’ Funds

a. Share Capital 1 303660376 139000000b. Reserve and Surplus 2 358622400 234894549

662282776 373894549

Loan Fundsa. Secured Loans 3 1192502654 471532258b. Unsecured Loans 4 812876925 372484923

2005379579 844017181

Deferred Tax Liability (Net) 114423193 55778424

2782085548 1273690154

APPLICATION OF FUNDSFixed Assets 5

a. Gross Block 1699261211 727248692b. Less:- Depreciation 154039124 73439861c. Net Block 1545222087 653808831d. Capital Work in Progress 53179594 141038166

1598401681 794846997

Investments 6 62303240 62303240Current Assets, Loans and Advances

a. Inventories 7 330617910 239237435b. Sundry Debtors 8 708358792 205175469c. Cash and Bank Balance 9 139989966 86517299d. Loans and Advances 10 202150431 210675474

1381117099 741605677

Less : Current Liabilities and Provisionsa. Current Liabilities 11 215713947 284132385b. Provisions 12 44134876 41158075

259848823 325290460

Net Current Assets 1121268277 416315217

Miscellaneous Expenditure 13 112350 224700(To the extent not written off or adjusted)

2782085548 1273690154

Notes forming part of Financial Statements 22

As per our report of even date

For, J. T. SHAH & COMPANYCHARTERED ACCOUNTANTS

J.T. SHAHPartner

Place : AhmedabadDate : 30/06/2007

For and on behalf of the Board

Vedprakash Chiripal Chairman

Brijmohan Chiripal Managing Director

Jigar H. Shah Company Secretary


24


NANDAN EXIM LIMITED

PROFIT & LOSS ACCOUNT FOR THE YEAR ENDED AS ON 31ST MARCH, 2007

Schedule 2006-07 2005-06(Rs.) (Rs.)

INCOMESales and Operating Income 14 2219505497 1287313757Other Income 15 8776072 3255370

2228281570 1290569127

EXPENDITUREMaterials 16 1606008295 883043387Employment Cost 17 51753345 28710132Manufacturing and Operating Expenses 18 108260973 67444939Administrative and Selling Expenses 19 75087704 38241476Interest and Finance Charges 20 101069260 36179949

1942179576 1053619883

Profit before Depreciation and Tax 286101993 236949243Less : Depreciation 5 80599263 49661155Profit before Taxation 205502730 187288088Provision for Income Tax- Current Tax (Including Wealth Tax and FBT) 17650000 25710000- Deferred Tax 58644769 37675043

76294769 63385043Profit after Tax & Before Prior Period Items 129207961 123903045Add / (Less) : Prior Period Items 21 276817 (201263)Less : Short/(Excess) Provision of Income Tax and Deferred Tax (2786093) 2688969Profit for the year 131717237 121415339Add : Balance brought forward from previous year 157856292 72281625

Balance Available For Appropriations 289573530 193696964Appropriations

General Reserve 11500000 12000000Interim Dividend 11387265 10425000Proposed Dividend — 10425000Tax on Dividend 1597064 2990672

24484329 35840672

Balance Carried to Balance Sheet 265089201 157856292

289573530 193696964

Basic and Diluted Earning per Share 0.45 0.48

Notes forming part of Financial Statements 22



J.T. SHAHPartner







25


NANDAN EXIM LIMITED

CASH FLOW STATEMENT FOR THE YEAR ENDED 31ST MARCH, 2007Particulars 2006-07 2005-06

(Rs.) (Rs.)

A. Cash flow from Operating ActivitiesNet Profit After Tax 131,717,235 121,415,339Adjustment for :

Depreciation 80,599,263 49,661,155Interest and Finance Charges 101,069,260 36,179,949Profit on Sale of Shares 0 (95,420)Preliminary Expenses written off 112,350 112,350Provision for taxation 76,294,769 63,385,043Short / Excess Provision of Income Tax (2,786,093) 2,688,969Dividend Received 20,000 (20,000)

255,309,549 151,912,046Operating Profit Before Working Capital Changes 387,026,784 273,327,385Adjustment for :

Sundry Debtors (503,183,322) (62,622,938)Inventories (91,380,474) (152,614,172)Loans and Advances 136,485,767 (128,779,663)Current Liabilities 54,823,423 117,435,097

(403,254,606) (226,581,676)Cash Generation from Operations (16,227,822) 46,745,709Income Tax Paid (25,209,552) (2,773,183)

NET CASH FROM OPERATING ACTIVITIES (41,437,374) 43,972,527

B. Cash flow from Investing ActivitiesPurchase of Fixed Assets (Incl. WIP) (1,116,931,509) (520,309,277)Purchase of Investments Nil NilSale of Investments / Fixed Assets Nil 242,040Dividend received (20,000) (20,000)

NET CASH USED IN INVESTMENT ACTIVITIES (1,116,951,509) (520,087,237)

C. Cash flow from Financing ActivitiesProceeds from Issue of Shares 169,999,991 120,000,000Increase in Secured Loan Borrowing 752,488,207 199,992,566Repayment of Secured Loan Borrowing (31,439,082) (22,296,000)Increase in Unsecured Loan Borrowing 686,557,793 354,383,478Repayment of Unsecured Loan Borrowing (245,014,346) (63,497,000)Share Issue / Preliminary Expenses Incurred (344,673) (4,668,120)Interest paid (95,673,953) (34,651,505)Dividend and tax on dividend paid (24,712,387) (19,759,694)

NET CASH FROM FINANCING ACTIVITIES 1,211,861,550 529,503,725

Net Increase / (Decrease) in Cash and Cash Equivalents 53,472,667 53,389,014Opening Balance of Cash and Bank 86,517,299 33,088,285Closing Balance of Cash and Bank 139,989,966 86,517,299

Notes: The above Cash Flow Statement has been prepared under the Indirect Method set out in Accounting Standard 3issued by the Institute of Chartered Accountants of India.Cash and Cash equivalents at the end includes Rs. 106135500/- (Previous Year Rs. 78068598/-) in respect ofFixed Deposit pledged with the Banks which are not available for use by the company.



J.T. SHAHPartner







26


NANDAN EXIM LIMITED

SCHEDULES FORMING PART OF THE FINANCIAL STATEMENTSFOR THE YEAR ENDED 31 ST MARCH’ 07.

As at As at31.03.2007 31.03.2006

(Rs.) (Rs.)

SCHEDULE - 1 : SHARE CAPITAL

Authorised

500000000 (Previous year 15000000) Equity Shares of Rs.1/- each 500000000 150000000(Previous Year Rs.10/- each)

Issued, Subscribed and Paid-up

303660376 (Previous Year 139000000) Equity Shares of Rs.1/- each 303660376 139000000

(Out of above 51000000 Shares (Previous Year 5100000 shares) are issued asbonus by capitalisation of reserves) and 151830188 Shares (Previous Year Nilshares) are issued as bonus from Share Premium Account)

303660376 139000000

SCHEDULE - 2 : RESERVE AND SURPLUS

General Reserve

As per last Balance Sheet 14800000 2800000

Add: Transfer from Profit and Loss Account 11500000 12000000

26300000 14800000

Share Premium Account

As per last Balance Sheet 62238257 6906377

Add: Received during the year 157169803 60000000

Less: Share issue expenses (344673) (4668120)

Less: Bonus Shares Issued (151830188) —

67233199 62238257

Profit and Loss Account 265089201 157856292

358622400 234894549

SCHEDULE - 3 : SECURED LOANS

Term Loans from Banks 823388789 310069844

Working Capital Loans from Banks 369113865 161462414

1192502654 471532258

Note :

1) Term Loans are secured by first charge on the entire Fixed Assets of the company - both present and future, secondcharge on Book Debts, Stock and other Current Assets of the Company and also further guaranteed by personalguarantee of some of the Directors

2) Working Capital loans are secured by first charge on Book Debts, Stocks and other Current Assets and second chargeon all the Fixed Assets both present and future of the Company and also by further guaranteed by personal guaranteeof some of the directors

3) Amount repayable within one year Rs. 2431.50 Lacs (Previous Year Rs. 464.45 Lacs)

27


NANDAN EXIM LIMITED

SCHEDULE - 4 : UNSECURED LOANSFrom Banks 340888202 240000000

Buyers Credit Arrangement 455038723 115534923

From Corporate Bodies 16950000 16950000

812876925 372484923

1) Amount repayable within one year Rs.9501.43 Lacs (Previous Year Rs.Nil)

SCHEDULE - 5 : FIXED ASSETS(Amount in Rs.)

Sr. FIXED GROSS BLOCK DEPRECIATION NET BLOCKNo. ASSETS As at Addition Deduction As at As at Addition Deduction As at As at As at

01.04.06 during during 31.03.07 01.04.06 during during 31.03.07 31.03.07 31.03.06the year the year the year the year

1 Land and Land 11929985 — — 11929985 — — — — 11929985 11929985Development

2 Building 88790519 245746504 — 334537023 3852371 5045140 — 8897511 325639512 849381483 Plant and 611794032 719388940 — 1331182972 67241085 74004677 — 141245762 1189937210 544552947

Machinery4 Furniture and 6235584 2955260 — 9190844 1131396 639425 — 1770821 7420023 5104188

Fixtures5 Computers 3090466 1498080 — 4588546 797326 592169 — 1389495 3199051 22931406 Office Equipments 2923060 894343 — 3817403 280615 288221 — 568836 3248567 26424457 Vehicle 2485046 1529391 — 4014437 137068 29631 — 166699 3847738 2347978

Total (a) 727248692 972012518 — 1699261210 73,439,861 80599263 — 154039124 1545222086 653808831

Previous Year 273377781 453870911 Nil 727248692 23778706 49661155 Nil 73439861 653808831 249599075

Capital Work in Progress (b) 53179594 141038166

Total (a) + (b) 1598401680 794846997

As at As at31.03.2007 31.03.2006

(Rs.) (Rs.)

SCHEDULE - 6 : INVESTMENTS (AT COST)LONG TERM - NON TRADEInvestment in Shares (Quoted)

In companies under the same Management2064000 (Previous year 2064000) Equity Shares of Nova Petrochemicals Ltd. 61920000 61920000of Rs. 10/- each.

In other companies20000 (Previous year 20000) Equity Shares of UCO Bank Ltd. of Rs. 10/- each 293240 293240

Investment in Shares (Unquoted)In companies under the same Management9000 (Previous year 9000) Equity Shares of Shanti Processors Ltd.of Rs. 10/- each. 90000 90000

Total 62303240 62303240

Aggregate value of Quoted Investments 62213240 62213240

Market value of Quoted Investments 30,356,000 116115000

As at As at31.03.2007 31.03.2006

(Rs.) (Rs.)

28


NANDAN EXIM LIMITED

SCHEDULE - 7 : INVENTORIESFinished Goods 182776554 175994818Stock in Process 25614649 30605704Raw Materials 119065542 29708650Stores, Spares and Packing Materials 3161165 2928263

330617910 239237435

SCHEDULE - 8 : SUNDRY DEBTORS(Unsecured, Considered good unless otherwise stated)Outstanding for period exceeding 6 months 22527913 5177174Others 685830879 199998295

708358792 205175469

SCHEDULE - 9 : CASH AND BANK BALANCESCash on Hand 3833695 1845064Balance with Scheduled Banks

In current accounts 30017008 2484325In Fixed Deposit/Margin Money 106135500 78068598

136152509 80552923Balance with Non Scheduled Banks 3762 4119312

139989966 86517299

SCHEDULE - 10 : LOANS AND ADVANCES(Unsecured, Considered good unless otherwise stated)Deposits 8294709 2754740Balance with Excise Authorities repayable on demand — 196Advance Recoverable in cash or in kind 163769267 203043635Advance Income Tax and T.D.S. 30086455 4876903

202150431 210675474

SCHEDULE - 11 : CURRENT LIABILITIESSundry Creditors

- SSI Units (Please refer Note no 12 of Schedule 22) 8625457 3025094- Others 187166770 263104320

Advance received from Customers 2256486 3027241Other Liabilities 17665234 14975730

215713947 284132385

SCHEDULE - 12 : PROVISIONSProvision for Taxation 44134876 29270969Proposed Dividend — 10425000Tax On Proposed Dividend — 1462106

44134876 41158075

SCHEDULE - 13 : MISCELLANEOUS EXPENDITURE(To the extent not written off or adjusted)Preliminary Expenses 224700 337050Less:Written off during the year 112350 112350

112350 224700

As at As at31.03.2007 31.03.2006

(Rs.) (Rs.)

29


NANDAN EXIM LIMITED

SCHEDULE - 14 : SALES AND OPERATING INCOMEGross Turnover 2177887509 1237417633

Less: Excise Duty (3686607) (2262912)

Net Turnover 2174200902 1235154721

Job Work 19539423 39578520

Export Incentive 29333415 13598941

Net Foreign Exchange Rate Difference (3568242) (1018425)

2219505497 1287313757

SCHEDULE - 15 : OTHER INCOMEDividend 20000 20000

Interest Received (TDS Rs.446871/- Previous Year Rs.102508/-) 6491184 1979785

Profit on Sale of Investment — 95420

Miscellaneous Income 1857660 837285

Balances Written Off 407228 322880

8776072 3255370

SCHEDULE - 16 : MATERIALSRaw Material Consumed 860114579 523704261

Finished Goods Purchase 747684397 489370314

Variation in finished goods and stock in progress

Opening Stock

Stock in Progress 30605704 2983039

Finished Goods 175994818 73586295

206600522 76569334

Closing Stock

Stock in Progress 25614649 30605704

Finished Goods 182776554 175994818

208391203 206600522

(1790681) (130031188)

1606008295 883043387

SCHEDULE - 17 : EMPLOYMENT COSTSalary, Wages and Bonus 51020192 28441845

Gratuity 733153 268287

51753345 28710132

SCHEDULE - 18 : MANUFACTURING AND OPERATING EXPENSESLabour /Jobwork and Process Charges 4158931 3665222

Carriage Inward 2203083 313899

Stores and Spares 1862919 2068690

Power and Fuel 93323848 56798976

Packing Material 4134999 3302903

Inspection Charges 2577193 1295249

108260973 67444939

2006-07 2005-06(Rs.) (Rs.)

30


NANDAN EXIM LIMITED

SCHEDULE - 19 : ADMINISTRATIVE AND SELLING EXPENSES

ADMINISTRATIVE EXPENSES

Rent, Rates and Taxes 1853115 1913540

Insurance Charges 2456804 2866445

Repairs and Maintenance

- Plant and Machinery 377204 512338

- Others 567394 261931

944598 774269

Travelling, Conveyance and Vehicle Expenses 9871243 7069355

Professional Fees and Legal Charges 9290378 3072121

Remuneration to Auditors

- for Audit fee 185000 84180

- for Tax Audit fee 15000 16836

- for Others 78435 81600

Communication Expenses 3739101 1948871

Miscellaneous Expenses 7265811 4159625

Preliminary Expenses written off 112350 112350

35,811,835 22099192

SELLING EXPENSES

Commission & Discount 12817838 6530306

Other Selling Expenses 12088274 4867656

Freight, Clearing and Forwarding 14369757 4744323

39275869 16142285

75087704 38241477

SCHEDULE - 20 : INTEREST AND FINANCE CHARGES

Interest and Other Charges paid to Bank 100797785 35769880

Interest paid to Others 271475 410069

101069260 36179949

SCHEDULE - 21 : PRIOR PERIOD ITEMS

Finance Charges Reversed — (2081030)

Clearing & Forwarding Charges — 205,321.00

Reversal of Sales — 1,207,897.00

Miscellaneous Expenses/(Income) 276817 466,549.00

276817 (201263)

2006-07 2005-06(Rs.) (Rs.)

31


NANDAN EXIM LIMITED

SCHEDULE 22: NOTES FORMING PART OF FINANCIAL STATEMENTS FOR THE YEAR ENDED 31ST March, 2007

1. SIGNIFICANT ACCOUNTING POLICIES

i) Basis of Preparation of financial Statements

The financial statements are prepared on accrual basis in accordance with the generally accepted accountingprinciples as adopted consistently by the company and according to the provisions of the Companies Act, 1956.

ii) Fixed Assets

Fixed Assets are stated at cost of acquisition less accumulated depreciation. All costs including financial coststill commencement of commercial production and net charges arising from exchange rate variation relating toliability incurred for the purpose of acquiring fixed assets are capitalized. Cenvat credit and EPCG claims oncapital goods are accounted for by reducing the cost of capital goods.

iii) Depreciation

Depreciation on fixed assets (excluding intangible assets) of the company is provided on straight-line method atthe rates and in the manner specified in Schedule XIV to the Companies Act, 1956, except depreciation onincremental cost arising on account of translation of foreign currency liabilities incurred for the purpose ofacquiring fixed assets, which is amortized over the residual life of the assets.

iv) Investments

Long Term Investments are stated at cost. Provision is only made to recognize a decline other than temporary,in the value of investments.

v) Inventories

(a) Inventories are valued at the Lower of cost or net realizable value. Net realizable value is the estimatedselling price in the ordinary course of business less the estimated cost of completion and estimated costnecessary to make sale. Cost in respect of Raw Materials and Trading Goods is computed on FIFO basis incase of Fabric Division. In respect of Spinning Division the Cotton bales are valued on specific costing. Costin respect of process and finished goods are computed on weighted average basis method. Finished goodsand process stock includes cost of conversion and other costs incurred in acquiring the inventory andbringing them to their present location and condition.

(b) Waste is valued at estimated net realizable value.

vi) Excise Duty / Cenvat

(a) Excise duty is accounted for on the basis of payments made in respect of goods cleared and provision ismade for goods lying in bonded Warehouse.

(b) Cenvat credit on excise duty paid goods is accounted for by reducing the purchase cost of related goods.

vii) Revenue Recognition

(a) Revenue from sale of goods is recognised when significant risks and rewards in respect of ownership of theproducts are transferred to the customers net of rate difference and discount given.

(b) Dividend on Investment is recognised when the right to receive the payment is established.

(c) Exports entitlement under the Duty Entitlement Pass Book (DEPB) scheme are recognised in the Profit andLoss Account when the right to receive credit as per the terms of scheme is established in respect of theexports made and where there is no significant uncertainty regarding the ultimate collection of the relevantexport proceeds.

(d) Subsidy under Textiles Upgradation Fund Scheme (TUFS) is recognized when there is reasonable certaintyregarding the realization of the same.

viii)Borrowing costs

Borrowing costs, which are attributable to acquisition or construction of qualifying assets, are capitalized aspart of cost of such assets till such assets are ready for its intended use. A qualifying asset is one, whichnecessarily takes substantial period of time to get ready for intended use. All other borrowing costs are chargedto revenue.

ix) Retirement benefits

Liability of gratuity to employees is determined and accounted for on the basis of actuarial valuation carried outannually.

32


NANDAN EXIM LIMITED

x) Foreign Currency Transactions / Exchange Fluctuation(a) Monetary Transactions related to foreign currency are accounted for at the equivalent rupee converted at

the rates prevailing at the time of respective transactions and outstanding in respect thereof are translatedat year end rates.

(b) Non-monetary foreign currency items are carried at cost.

xi) Amortization of ExpensesPreliminary expenses are amortized over a period of five years. The balance of share issue expenses account atthe year end has been adjusted against the share premium account.

xii) Provisions and ContingenciesA provision is recognized when there is a present obligation as a result of past event and it is probable that anoutflow of resources will be required to settle the obligation, in respect of which a reliable estimate can bemade.

A disclosure for a contingent liability is made when there is a possible or present obligation that may, butprobably will not require an outflow of resources.

2. Contingent liabilities not provided for:a) Estimated amount of Contracts remaining to be executed on capital account amounting to Rs. 18935.60 Lacs

(Previous Year Rs. 1086.23 Lacs) for which the company has opened letter of credit of Rs.48.25 lacs (Previousyear Rs. 135.34 Lacs). Advance paid against such contracts is Rs. 113.54 Lacs. (Previous year Rs.308.24 Lacs)

b) A Letter has been received by the Company from Service Tax Department seeking clarification for service tax onselling commission (amount for which has not been quantified), the reply for which has been made and furthercommunication awaited and in respect of show cause notice issued by Commissioner, Central Excise for ExciseDuty amounting to Rs.195.08 Lacs (Previous Year Rs. Nil) reply against which has been made and the matter ispending for further hearing.

3. The company has imported certain capital equipments at concessional rate of custom duty under “Export Promotionof Capital Goods Scheme”. The company has pending export obligation to the extent of Rs.9605.16 Lacs (Previousyear Rs. 2893.79 Lacs) to be fulfilled during the specified period. The liability towards custom duty payable thereonin respect of unfulfilled export obligation as on 31st March 2007 is Rs.1211.91Lacs. (Previous Year Rs. 367.19 Lacs)

4. In the opinion of the Board of Directors, Current Assets, Loans and Advances have a value on realization at leastequal to the amount at which they are stated in Balance sheet. Adequate provisions have been made for all knownliabilities except stated otherwise.

5. Balances of Debtors, Creditors, Loans and Advances etc. are subject to confirmation and reconciliation.

6. Diminution in the value of investments has not been provided, as in the opinion of the Board of Directors, the sameis considered to be of temporary in nature.

7. Borrowing costs attributable to the acquisition or construction of Qualifying Assets amounting to Rs. 25,425,899/-(Previous Year Rs. 11,615,517/-) is capitalized by the company net of TUFS interest subsidy Rs. Nil/- (Previous Year709,061/-).

8. Foreign exchange fluctuation Gain of Rs. 5,034,115/- in respect of fixed assets, pertaining to the year up to the dateon which the assets are ready for its intended use (Previous Year gain Rs. 14,371,146/-) have been reduced from thecost of Fixed Assets. Foreign exchange loss of Rs.2,776,975/- (Previous Year Rs.10,18,425/-) in respect of Exportsincluded in Sales and Operating Income. Foreign exchange loss amounting to Rs.7,91,269/- (Previous YearRs.148,225/- ) in respect of various items is debited to respective items.

9. Maximum amount of debit balance at any time during the year in current account with Naroda Nagrik Sahakari bankLtd a non scheduled bank is Rs. 4,119,312/- (Previous Year Rs. 1,02,61,822/-).

10. Interest and Finance Charges are net of interest subsidy received/receivable under TUFS scheme amounting toRs.14,252,064 /- (Previous year Rs. 93,09,646/-).

11. Professional Fees and Legal Charges includes Rs. 11,917,792/- (Previous year Rs. 12,50,642/-) relating to borrowingcost.

12. Share issue expenses (Preferential Allotment) amounting to Rs. 344,673/- are adjusted against the balance of sharepremium account. (Previous Year Rs. 4,668,120/-)

13. To the extent of available information, at the year-end the list of SSI Units to whom the amount outstanding due formore than 30 days is as follows:

Allwin Industries, Anukool furniture System Ltd, Daga Finmark India Ltd., Excel Product System, ITW India Limited,Jai Specialty Starch, Jupiter Engineering co, Mazda Limited, New Aarkay Industries, Nova Flexipack Pvt Ltd. PatelAirtemp (India) Ltd, Swati Switchgear (I) Pvt Ltd, Techno Industries, The Forum Engineers The Gujarat Hume Pipe &Cement Transformers & Rectifiers (I), Tushar Enterprise & Galvanizer

33


NANDAN EXIM LIMITED

14. Capital work in Progress includes expenditure during construction period as under:

(Rs. In Lacs)

Particulars 31.03.07 31.03.06

Pre Operative Expenses 309.84 23.33Finance Charge 162.85 38.58Professional Fees 6.16 0.62

15. The company has paid remuneration to its directors during the year as follows:

Sr. No. Name 31.03.07 31.03.06

1 Shri Brijmohan Chiripal 1,800,000 Nil

16. Related Party Disclosures:

A) Key Management Personnel:

Sr. No. Name Designation

1 Shri Vedprakash Chiripal Chairman2 Shri Brijmohan Chiripal Managing Director3 Shri Deepak Chiripal CEO

B) List of Other Related Parties with whom transactions have taken place during the year:

No. Name No. Name

1 Nova Petrochemicals Limited 20 Chiripal Enterprise Ltd.

2 Bhushan Processors Pvt. Ltd. 21 Bhavna Textiles Pvt. Ltd.

3 Sparrow Exports Pvt. Ltd. 22 Quality Exim Pvt. Ltd.

4 Prakash Calendars Pvt. Ltd. 23 Dindayal Processers Pvt. Ltd.

5 Chiripal Textiles Mills Pvt Ltd. 24 Deepak Enterprise

6 Shanti Exports Pvt. Ltd. 25 Chiripal Charitable Trust

7 Deepak Impex Pvt. Ltd. 26 Vraj Integrated Textile Park Ltd.

8 Chiripal Industries Ltd. 27 Hexa International Ltd

9 Ved Prakash D Chiripal 28 Birjmohan D chiripal

10 Jyotiprasad D Chiripal 29 Nishi J Agarwal

11 Urmiladevi J Agarwal 30 Deepak J Agarwal

12 Birjmohan D HUF 31 Jayprakash D Agarwal

13 Manjuladevi J Agarwal 32 Ved Prakash Devkinandan HUF

14 Nidhi J.Agarwal 33 Vansh J.Agarwal

15 Jaiprakash D HUF 34 Jyotiprasad D HUF

16 Vedprakash Brijmohan (HUF) 35 Vedprakash Jayprakash (HUF)

17 Vedprakash Jyotiprasad(HUF) 36 S.Jayprasad (HUF)

18 S.Ved Prakash(HUF) 37 V.Jayprakash(HUF)

19 Kavita V Agarwal 38 Saloo J Agarwal

34


NANDAN EXIM LIMITED

C) Details of Transactions with Key Management Personnel and Related Parties of the Key Management Personnelare as follows:

(Rs. In Lacs)

Sr. Nature of Transaction Key Management Other Related TotalNo. Personnel Parties

2006-07 2005-06 2006-07 2005-06 2006-07 2005-06

1 Unsecured Loans - TakenTaken during the period Nil Nil Nil 1087.00 NIL 1087.00

Repaid during the period Nil Nil Nil 1621.97 NIL 1621.97

Balance as at Balance Sheet Date Nil Nil 169.50 169.50 169.50 169.50

2 Unsecured Loans - GivenGiven during the period Nil Nil 302.00 Nil 302.00 Nil

Repaid during the period Nil Nil 282.00 Nil 282.00 Nil

Balance as at Balance Sheet Date Nil Nil 20.00 Nil 20.00 Nil

3 Advances Recoverable inCash or KindGiven during the period Nil Nil 3135.03 2485.57 3135.03 2485.57

Settled during the period Nil Nil 3415.82 2571.90 3415.82 2571.90

Balance as at Balance Sheet Date Nil Nil Nil 280.79 Nil 280.79

4 ExpenditurePurchase of Goods Nil Nil 5604.80 2621.26 5604.80 2621.26

Rent Nil Nil 4.80 17.34 4.80 17.34

Electricity Charges paid Nil Nil Nil 2.50 Nil 2.50for Common Premise

Donation Nil Nil 11.00 6.00 11.00 6.00

Job Work Charges Nil Nil 178.28 3.29 178.28 3.29

5 Income ReceivedSales Nil Nil 1254.94 1102.05 1254.94 1102.05

Sale of DEPB Nil Nil 101.39 78.03 101.39 78.03

Job work Nil Nil Nil 61.60 Nil 61.60

6 Amount Expended on Nil Nil Nil 0.17 Nil 0.17behalf of others

7 Amount Paid on Our Behalf Nil Nil 49.34 12.79 49.34 12.79

8 Amount paid on Behalf of Others Nil Nil 116.56 7.74 116.56 7.74

9 Amount received by others Nil Nil Nil 14.69 Nil 14.69

10 Issue of Share Capital Nil Nil 1452.00 Nil 1452.00 Nil

11 Advance for Capital Goods Nil Nil Nil 5.00 Nil 5.00

12 Remuneration paid 37.80 Nil Nil Nil 37.80 Nil

13 Dividend Paid 25.99 51.98 43.32 70.55 69.31 122.53

17. The Company is considered to be engaged in Textile Industry with all activity revolving around this business andaccordingly has only one reportable business segment. The company has identified geographical segment as itssecondary business segment, the details are as follows:Secondary Segment Information for the year ended 31st March, 2007

(Rs. in Lacs)

India Rest of World Total

31.03.07 31.03.06 31.03.07 31.03.06 31.03.07 31.03.06

1 Segment Revenues 18108.69 10855.61 4086.36 2017.53 22195.05 12873.14

2 Segment Assets 29075.38 14601.86 1342.84 1385.70 30418.22 15987.56

3 Capital Expenditure during the year 9720.13 4538.71 — — 9720.13 4538.71

35


NANDAN EXIM LIMITED

18. Application of funds raised through public issue

Particulars 31.03.07 31.03.06

Opening Balance Nil Nil

Funds raised during the year Nil 1200.00

Funds utilized

For on going capital expenditure (Including the repayment of Nil 1137.38temporary loans taken for the said purpose)

Public Issue Expenses (Including expenses incurred during previous year) Nil 62.62

Balance available Nil Nil

19. Earning per Share

Particular Unit 31.03.07 31.03.06

Numerator used for calculating Basic and Diluted Rs. 131717237 121415339Earning per Share (Profit after Tax)

Weighted average No. of shares used as denominator for No. of Shares 290443525 126671233calculating Basic and Diluted

Nominal Value of Share Rs. 1 1

Basic and Diluted Earning per Share Rs. 0.45 0.48**

** Earning per share is adjusted as a result of Issue of Bonus shares issued during the year by the company.

20. Information relating to Deferred Tax(Rs. In Lacs)

Particulars 31.03.07 31.03.06

Deferred Tax Assets arising out of timing difference relating to:

- Disallowance under Income Tax Act, 1961 8.58 7.04

- Amount allowable under provisions of the Nil NilIncome Tax Act, 1961 in subsequent years

Total Deferred Tax Assets 8.58 7.04

Deferred Tax Liability arising out of timing difference relating to:

- Difference of Depreciation as per Tax provisions and Company Law 1152.82 564.82

Total Deferred Tax Liability 1152.82 564.82

Net Deferred Tax Liability 1144.23 557.78

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

22. Additional information pursuant to the provisions of paragraph 3 and 4 of part-II and part-IV of Schedule VI of theCompanies Act, 1956 for the year ended on 31st March, 2007.

(a) Licensed & Installed capacity

Particulars Unit of Licensed Installed capacityMeasurement capacity In mtr. (Annualized)

31.03.2007 31.03.2006

Denim and Grey Fabrics Mtr. N.A. 35600000 30400000

Spinning Kg. N.A. 7200000 Nil

Garment Pcs. N.A. 540000 Nil

36


NANDAN EXIM LIMITED

(b) Opening Stock & Closing Stock of Finished Goods:

Particulars Opening Stock Closing StockUnit Quantity Value Rs. Quantity Value Rs.

31.03.07 31.03.06 31.03.07 31.03.06 31.03.07 31.03.06 31.03.07 31.03.06

Grey Mtrs. 339999 122150 14074389 5950465 721818 339999 33583705 14074389

Denim Mtrs. 1112873 Nil 73449618 Nil 1448507 1112873 87951055 73449618

Fabrics Mtr. 3156782 1726803 81442021 67635830 2644213 3156782 61213524 81442021

Garment Nos Nil Nil Nil Nil 260 Nil 28270 Nil

Others - — — 7028790 Nil — — — 7028790

Total — — 175994818 73586295 — — 182776554 175994818

(c) Production meant for Sale:

Particulars Units Actual production31.03.2007 31.03.2006

Grey Mtrs. 4671729** 7461782

Denim Mtrs. 15054642**@ 6470760

Garment Nos 260 Nil

** Production of Grey and Denim includes 738615 mtrs. (Previous year 2134556 mtrs.) and NIL mtrs. (PreviousYear 133712) of goods produced for others on job work basis

@ Production includes 10701 Mtrs (Previous Year Nil) of goods issued in producing the Garments.

Note: Production of Yarn in Spinning units is done only for captive consumption.

(d) Purchase of Finished Goods:

Particulars Unit Quantity Amount Rs.

31.03.07 31.03.06 31.03.07 31.03.06

Fabrics Mtr. 19482403 8271337 503487012 203435999

Knitted Fabrics Kg. 1015312 2321372 118973010 216147955

Grey Mtr 35016 Nil 2013238 Nil

Others — — 123211137 69786360

Total — — 747684397 489370314

(e) Turnover

Particulars Unit Quantity Amount Rs.31.03.07 31.03.06 31.03.07 31.03.06

Grey Mtrs. 3586311 5109377 229523208 266033523

Denim Mtrs. 14708307 5224175 1029752824 479276465

Fabrics Mtrs. 19994972 6841358 654944379 189172653

Knitted Fabrics Kgs. 1015312 2321372 143973008 236534624

Others Kgs. — — 119694090 66400368

Total — — 2177887509 1237417633

37


NANDAN EXIM LIMITED

(f) Raw material consumed

Particulars Unit Quantity Value (Rs.)31.03.07 31.03.06 31.03.07 31.03.06

Cotton Yarn Kgs. 9351303 6215107 706371820 475428502

Other raw materials — — 153742759 48275759

Total — — 860114579 523704261

(g) Value of Imported & Indigenous Raw Materials, Stores, Components & Spares parts consumed

Raw Materials Components & Spare Parts% Value (Rs.) % Value (Rs.)

31.03.07 31.03.06 31.03.07 31.03.06 31.03.07 31.03.06 31.03.07 31.03.06

i. Imported 1.14 1.68 9845267 15686046 Nil Nil NIL Nil

ii. Indigenous 98.86 98.32 850269312 508018215 100 100 1862919 2068690

Total 100 100 860114579 523704261 100 100 1862919 2068690

(h) C.I.F. Value of Imports:

Particulars Amount Rs.31.03.2007 31.03.2006

Raw Materials 15986191 13961471

Trading Goods 26600268 63764795

Capital Goods 509894343 176463599

(i) Expenditure In Foreign Currency


i. Travelling Expenses 1748259 579500

ii. Foreign Bank Charges 4265741 831740

iii. Commission paid 6642992 859110

(j) Earning In Foreign Currencies


FOB Value of Export Goods 406053485 185262679

Note: Previous year’s figures have been shown in brackets.



J.T. SHAHPartner


Signature to Schedules “1” to “22”





38


NANDAN EXIM LIMITED

BALANCE SHEET ABSTRACT AND COMPANY’S GENERAL BUSINESS PROFILE

I. Registration Details

State Code 04 Registration No. 22719

Balance Sheet Date 31st March, 2007 CIN L51909GJ1994PLC022719

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

Public Issue NIL Right Issue NIL

Bonus Issue 15,18,30,188 Private Placement (Including Premium) NIL

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

Total Liabilities Rs.2,78,20,85,548/- Total Assets Rs.2,78,20,85,548/-

SOURCES OF FUNDS

Paid up Capital Rs.30,36,60,376/- Reserves & Surplus Rs.35,86,22,400/-

Secured Loans Rs.1,19,25,02,654/- Unsecured Loans Rs.81,28,76,925/-

Deferred Tax Liability Rs.11,44,23,193/-

APPLICATION OF FUNDS

Net Fixed Assets Rs.1,59,84,01,681/- Investments Rs. 6,23,03,240/-

Net Current Assets Rs.1,12,12,68,277/- Miscellaneous Expenditures Rs.1,12,350/-

Accumulated Losses Rs. NIL

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

Turnover Rs.2,22,82,81,570/- Total Expenditure Rs.1,94,21,79,576/-

Profit(+) / Loss(-) before Tax Rs. 20,55,02,730/- Profit(+)/Loss(-) after Tax Rs. 13,17,17,237/-

Earning per Share (in Rs.) Rs.0.45

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

Item Code No. 2352.00

Product Description Denim Fabrics


Product Description Cotton Yarn


Product Description Ready Garments


Product Description Power Generation





39


NANDAN EXIM LIMITED

NANDAN EXIM LIMITEDRegd Office:Survey No.198/1, 203/2, Saijpur-Gopalpur, Pirana Road, Piplej, Ahmedabad - 382 405

ATTENDANCE SLIP

PLEASE COMPLETE THE ATTENDANCE SLIP AND HAND IT OVER AT THE ENTRANCE OF THE MEETING HALL.

Joint shareholders may obtain additional Slip at the venue of the meeting.

DP Id* : Master Folio No. :

ClientId* :

Name and Address of the Shareholder :

No. of Shares (s) held :

I/We hereby record my/our presence at the 13th ANNUAL GENERAL MEETING of the Company to be held on Friday, 28thSeptember, 2007 at 3.30 P.M. at Survey No. 198/1, 203/2, Saijpur-Gopalpur, Pirana Road, Piplej, Ahmedabad - 382 405

Signature of the shareholder or proxy

Applicable for investors holding shares in electronic form.

NANDAN EXIM LIMITEDRegd Office:Survey No.198/1, 203/2, Saijpur-Gopalpur, Pirana Road, Piplej, Ahmedabad - 382 405

PROXY FORM

I/We, of

being a member/members of Nandan Exim Limited hereby appoint

of

or falling him/her of as my/our

proxy to vote for me/us and on my/our behalf at the 13th ANNUAL GENERAL MEETING of the Company to be held on

Friday, 28th September, 2007 at 3.30 P.M. or at any adjournment thereof.

Signed this day of 2007

• Applicable for investors holding shares in electronic form.

NOTE :

(1) The proxy in or to be effective should be duly stamped, completed and signed and must be deposited at theRegistered Office of the company not less than 48 hours before the time for holding the aforesaid meeting. TheProxy need not be a member of the Company.

(2) Members holding shares under more than one folio may use photocopy of this Proxy Form for other folios. TheCompany shall provide additional forms on request.

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