Directors Report of BCL Forgings Ltd.

Mar 31, 2011

The Directors have pleasure in presenting Annual Report and the Audited Accounts for the period ended 31.03.2011.

(Rs. In Lacs)

Financial Results

Year Year ended ended 31.03.2011 31.03.2010

Sales & other Income 3353 4493.81

Profit before Depreciation, interest & Tax (853) (172.78)

Depreciation 126 145.70

Interest 596 596.94

Deferred Tax Liability Nil (69.66)

Profit for the year (853) (845.76)

Profit/(Loss) brought forward from previous year (1177) 194.44

Profit/ (Loss) after Tax transferred to Balance Sheet (2030) (651.32)

OPERATIONS;

During the year ending 31.03.2011, the Company could achieve a turn over of Rs. 3353.12 lacs as. compared to the turn over of Rs. 4345.74 lakhs during the year 2009 -10. This was mainly on account of continuation of recessionary trends & lack of working capital.

Even though the Company has good orders in hand, the same cannot. be fulfilled due to lack of working capital, which is on account of the losses suffered by Company during previous years due to recessionary conditions. However, Management is discussing with bankers for the same and is quite hopeful about the results.

Also Management has taken steps to reduce over heads by reducing employee strength and increasing the efficiency.

However, with the improvement in the demand pattern for Company's products especially from the Indian clients, simultaneously with the various cost control measures under taken, the Company incurred losses of Rs.. 853 lakhs. However, these losses were mainly due to financial expenses and depreciation of Rs. 719 lakhs.

Future Prospects

Management is also trying to increase the share of non-automobile sectors such as Windmill Energy, Earth Moving, Equipment, Mining, Hydraulics, Agriculture and export related customers and also has developed various items for the same and consequently we got results as below.

i) Turnover for the quarter ended 31.03.2011 was Rs. 828.69 lakhs.

ii) Turnover for the quarter ended 30.06.2011 is Rs.1000.48 lakhs

iii) Turnover for the quarter ended¦30.09.2011 is Rs. 977.62 lakhs

Fixed Deposit

The Company has hot accepted any Fixed Deposits for the year ended 31st March, 2011.

Particulars under Section 2l7(l)(e) of the Companies Act 1956:

The information as required under section 217(l)(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the report of the Board of Directors) Rules, 1988 pertaining to energy conservation, technology absorption and foreign exchange earnings and outgo is given in the Annexure forming part of this report.

Directors

Mr. Sanjay Gaikwad and Mr. Rajiv Raje, Directors of the Company would retire by rotation at the ensuing Annual General Meeting of the Company anxl are eligible for the re-appointment.

During the year Mr. N. E. Narwade and Mr. Amish Patel were appointed as additional directors of the company by the Board of Directors on August 13, 2011. By virtue of Section 260 of the Companies Act, 1956, he holds office upto the date of the ensuing Annual General Meeting and is eligible for appointment.

Mr. N. E. Narwade has been appointed by the Board as Whole Time Director of the Company for a period of three years with, effect from August 13, 2011. Necessary resolution has been proposed in notice of the ensuing Annual General Meeting for his appointment and payment of remuneration.

Mr. Chanclrashekhar Dhongde resigned as Managing Director of the Company with effect from July 1, 2011. lie continues to be a director of the Company.

Listing

The shares of the Company are listed on Bombay Stock Exchange Ltd., Delhi Stock Exchange Ltd. The Company has paid the necessary listing fees for the year 2011- 12 to the Bombay Stock Exchange Ltd.

The Company's application for delisting is pending with the Delhi Stock Exchange Ltd.

CORPORATE GOVERNANCE

Report on Management Discussion & Analysis and Corporate Governance and' a certificate-from the Auditors of the Company regarding compliance of conditions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges are attached hereto and form part of this Report.

Particulars of Employees:

The Company does not have any employee whose particulars are required to be given pursuant to the provisions of Section 217 (2.A) ol the Companies Act, 1956 read with the Companies (particulars of Employees) Rules, 1975.

Directors' Responsibility Statement

Pursuant to section 217(2 A A) of the Companies Act 1956 your Directors confirm the following

a) that in the preparation of the annual accounts, die applicable accounting standards have been followed and that no material departures have been made from the same;

b) that, the directors have selected such 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, or loss of the Company for that period;

c) that the directors have-taken proper and sufficient care for the-maintenance of adequate accounting record 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) that the directors have prepared the annual accounts on a going concern basis;

Auditors

The reference made by the Auditors in their report and notes to Accounts are self- explanatory and require ho further explanation.

M/s. M.A. Parikh & Co. Chartered Accountants, Auditors of the Company, retire at the ensuing Annual General Meeting and are eligible for re-appointment

Industrial Relations,

The overall Industrial Relations in the Company have been cordial. Your Company has received full cooperation and support of its personnel. Your Directors thank them and expect the same support from them in the years to come.

Acknowledgements;

The Board wishes to thank their customers, suppliers, Shareholders and the Bankers of the Company for their support and co-operation.

For and on behalf of the Board

November 24,2011 Director Director

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Mar 31, 2010

The Directors have pleasure in presenting Annual Report and the Audited Accounts for the year ended 31.03.2010.

Financial Results (Rs. In Lacs)

Year ended Year ended 31.03.2010 31.03.2009

Sales & other Income 4345.74 4493.81

Profit before Depreciation, Interest & Tax 120.92 (172.78)

Depreciation 113.08 145.70

Interest 533.51 596.94

Deferred Tax Liability 0.50 (69.66)

Profit for the year (526.17) (845.76)

Profit/(Loss) brought forward from previous year (651.32) 194.44

Profit/(Loss) after Tax transferred to Balance Sheet (1177.49) (651.32)

OPERATIONS :

During the year ending 31.03.2010, the Company could achieve a turn over of Rs. 4345.74 lacs as compared to the turn over of Rs. 4493.81 lacs during the year 2008-09. This was mainly on account of continuation of recessionary trends resulting out of global melt down especially during the first half of the year.

The Companys dependence on heavy commercial vehicle sector as well as export to USA & UK was to the extent of almost 75%. Both these sectors having been hit very badly on account of severe recession reflected in poor demand for Companys products. This poor demand especially against the huge capacity to the extent of 21600 tons per annum which was created after the expansion programme resulted in huge under utilisation of plant ca- pacity and disproportionate increase in the cost of various heads especially that of interest and employees remuneration which as a percentage of sales increased phenomenally.

However, with the improvement in the demand pattern for Companys products especially from the Indian clients, simultaneously with the various cost control measures undertaken, the Company incurred losses of Rs. 526.17 lakhs. However, these losses were mainly on account of financial expenses of Rs. 533.51 lakhs and depreciation of Rs. 113.08 lakhs.

Future Prospects

The present demand pattern from the various Indian clients has improved to a very great extent even though the demand from over seas clients continues to be sluggish. It is ex- pected that from December, 2010 onwards there will be increase in the demand pattern from the over seas clients and the same from Indian clients also will be substantially high. Over all it is felt that during the 2nd half of the financial year, there will be substantially higher demand for Companys products.

Fixed Deposit

The Company has not accepted any Fixed Deposits for the year ended 31 * March, 2010.

Particulars under Section 217(1)(e) of the Companies Act. 1956:

The information as required under section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the report of the Board of Directors) Rules, 1988 per- taining to energy conservation, technology absorption and foreign exchange earnings and outgo is given in the Annexure forming part of this report.

Directors

Mr. Surendra B. Chandorkar, Director of the Company would retire by rotation at the ensuing Annual General Meeting of the Company and is eligible for the re-appointment.

Listing

The shares of the Company are listed on Bombay Stock Exchange Ltd., Delhi Stock Exchange Ltd. The Company has paid the necessary listing fees for the year 2010-11 to the Bombay Stock Exchange Ltd.

The Companys application for delisting is pending with the Delhi Stock Exchange Ltd.

CORPORATE GOVERNANCE

Report on Management Discussion & Analysis and Corporate Governance and a certificate from the Auditors of the Company regarding compliance of conditions of Corporate Governance as stipulated under Clause 49 of the Listing Agreement with the Stock Exchanges are attached hereto and form part of this Report.

Particulars of Employees:

The Company does not have any employee whose particulars are required to be given pursuant to the provisions of Section 217 (2A) of the Companies Act, 1956 read with the Companies (particulars of Employees) Rules, 1975.

Directors Responsibility Statement

Pursuant to section 217(2AA) of the Companies Act, 1956 your Directors confirm the following

a) that in the preparation of the annual accounts, the applicable accounting standards have been followed and that no material departures have been made from the same;

b) that the directors have selected such accounting policies and applied them consistently and made judgements and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit or loss of the Company for that period;

c) that the directors have taken proper and sufficient care for the maintenance of adequate accounting record 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) that the directors have prepared the annual accounts on a going concern basis;

Auditors

The reference made by the Auditors in their report and notes to Accounts are self-explana- tory and require no further explanation.

M/s. M.A. Parikh & Co. Chartered Accountants, Auditors of the Company, retire at the ensu- ing Annual General Meeting and are eligible for re-appointment.

Industrial Relations

The overall Industrial Relations in the Company have been cordial. Your Company has re- ceived full cooperation and support of its personnel. Your Directors thank them and expect the same support from them in the years to come.

Acknowledgements:

The Board wishes to thank their customers, suppliers, Shareholders and the Bankers of the Company for their support and co-operation.

For and on behalf of the Board 27th August, 2010 Managing Director Director