Directors Report of Bafna Spinning Mill & Exports Ltd.

Mar 31, 2011

To The Members BAFNA SPINNING MILLS & EXPORTS LIMITED

The Directors have pleasure in presenting the Annual Report of the Company together with the Audited Accounts for the financial year ended on 31st March 2011.

1. Financial Results (Rs. in Lacs)

Particulars 2010-11 2009-10

Sales - 618.25

Other income 6.4 -

Depreciation 1.18 3.38

Other Expenditure 3.6 33.33

Profit/Loss before Tax 2.8 24.53

Profit/Loss after Tax 1.06 14.64

During the current year your company has achieved a reasonable: level of growth We are hoping that the phenomenal growth shall be achieved during the next coming years.

2. Directors

Mr. Vinod Jain, Director of the company retires at the ensuring Annual General meeting and eligible for re-appointment.

3. Personnel

Your directors' wish to place oil record their appreciation for the contribution to growth of the business made by employees al all levels, Information as required pursuant to section 2 17(2A) of the companies Act, 1956 has not been given, as it is not applicable.

4. Auditors

M/s K R Shah & Associates, Chartered Accountants, Ahmadabad, was appointed as Auditor of the Company during the year to fill the casual vacancy caused by the resignation of V Nagarajan Chartered Accountants, Coimbatore.

5. Deposits

During the year, Company has not accepted inter corporate Deposits, which falls under Section 58A of Companies Act, 1956.

6. Energy. Technology And Foreign Exchange

The additional information required to be disclosed in terms of notification No.1029 dated 31SL December, 1998 issued by the Department of Company Affairs, Ministry of Finance is not applicable.

7. Directors' Responsibility Statement

Pursuant to Section 217(2A) of Companies Act, 1956, the Directors confirm that:

i. In the preparation of Annual Accounts, appropriate accounting standard have been followed.

ii. Appropriate accounting policies have been selected and applied consistently and judgments and estimates made that are reasonable and prudent so as to give true and fair view of state of affairs of the company at the end of financial year ended 31st March, 2011.

iii. Proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of Companies Act, 1956 for safe guarding the assets of the company and for preventing and detecting fraud and other n regularities.

iv. The Annual Accounts have been prepared on going concern basis.

8. Auditor's Qualification

Auditors have qualified their report to the members of the Company. In this connection directors of the Company have discussed the same at arm's length on the recommendation of audit committee and have imitated to take necessary action so as lo show fail' view of state of affairs of the company in the coming financial year.

9. Report on Corporate Governance

Compliance Report on Corporate Governance is a part of Annual Report is annexed herewith.

10. Acknowledgements

Your Directors wish to please on record their appreciation of the whole hearted co-operation extended to company from various departments of the central and state governments, company' bankers and financial institutions and employees of the company and look forward for the same cordial relationship in coming years.

PLACE: COIMBATORE FOR AND ON BEHALF OF THE BOARD

DATE : 29/08/2011 Sd/-

CHAIRMAN

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Mar 31, 2010

The Directors have pleasure in presenting the nineteenth Annual Report of the Company and the Audited Statement of Accounts for the year ended 31st March 2010.

1. FINANCIAL HIGHLIGHTS:

Your Company during this financial year has started trading activities in Textiles.

2. DIVIDEND

As the commercial production is yet to be started, your Directors regret that no dividend is declared.

3. DIRECTORS:

Mr Vinod Jain retires by rotation at the ensuing Annual General Meeting and being eligible offers himself for re-appointment. Your Directors recommend her re-appointment.

4. AUDITORS REPORT:

The observations made in the Auditors Report are self-explanatory and therefore do not call for further comments under Section 217 of the Companies Act, 1956.

5. AUDITORS:

Your Directors recommend the re-appointment of M/s. V. Nagarajan, B.Com., RCA, Chartered Accountant, 208, T V Samy Road, R S Puram, Gowtham Arcade, 3rd Floor, Coimbatore - 641002 .

6. PERSONNEL:

There were no employees during the year drawing remuneration which falls within the preview of the provisions of Section 217 (2A) of the Companies Act, 1956. Therefore the statement for the same is not attached.

7. FUTURE PROJECTS:

A. The process of locating and establishing an overseas office at Strasbourg (near Paris) France is on.

B. The land for the Residential Row Houses Project "Sankeshwar Darshan", about 7 kms from the Jain religious centre Sankeshwar in Gujarat has been identified and the negotiations are on. The envisaged project cost is Rs.200 crores.

8. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, & INNOVATION AND FOREIGN EXCHANGE EARNINGS & OUTGOINGS:

The details pertaining to Conservation of Energy, Technology Absorption, & Innovation and Foreign Exchange are not furnished as the Company is yet to commence Commercial Production.

9. FIXED DEPOSITS:

The Company has not invited / accepted / renewed / any fixed deposits as per the provisions of Section 58A of the Companies Act, 1956 from the Public during the financial year.

10. CORPORATE GOVERNANCE:

As per the Clause 49 of the Standard Listing Agreement, the provisions relating to the Corporate Governance has become applicable to the Company from the year 2003-2004. The Company has constituted various committees during the current year. The Company has obtained a certificate from the Auditors of the Company regarding compliance of conditions of Corporate Governance. The same is annexed to this Report.

11. DIRECTORS RESPONSIBILITY STATEMENT

In Compliance of Section 217 (2AA), as incorporated by the Companies (Amendment) Act, 2000 in the Companies Act, 1956 your Directors confirm that:

a) The Company has followed the applicable standards in the preparation of the Annual Accounts and there had been no material departure.

b) Directors had selected the accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and loss of the Company for the aforesaid period.

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

d) The Directors have prepared the Annual Accounts on a going concern basis.

12. ACKNOWLEDGEMENT:

The Board of Directors express their deep gratitude for the co-operation and support extended to your Company by its shareholders, and various officials of SEBI, The Stock Exchange, Mumbai, the Department of Company Affairs, Registrar of Companies. Your Directors also place on record the commitment and involvement of the employees at all levels and looks forward to their continued co-operation.

For and on behalf of the Board

BAFNA SPINNING MILLS & EXPORTS LIMITED

Sd/-

S R Bafna

Chairman Coimbatore: August 30,2010