Directors Report of Decolight Ceramics Ltd.

Mar 31, 2015

Dear Members,

The Directors are pleased to present their report on the working of the company along with the Audited Accounts for the year ended 31st March, 2015:

1. FINANCIAL RESULTS :

The details of the financial performance of the company are appearing in the Balance sheet, Profit & Loss Account along with other financial statement.

Highlights are as under (Rs. In Lacs)

Particulars 2014-15 2013-14

Total Income from operations 237.31 1019.85

Profit before considering Exceptional items, Prior Period Items, Interest, Depreciation and Taxation -929.96 -1756.97

Less: Interest & Financial Charges 564.56 498.37

Less: Depreciation 514.37 431,86

Profit / (Loss) before considering Exceptional Items, prior period Item and Tax -2008.89 -2687.20

Less: Exceptional Items 830.28 789.81

Profit / (Loss) after exceptional items and before prior period Item and tax -2839.17 -3477,01

Less: Prior period items 5.00 -

Profit / (Loss) Before Tax -2844.17 -3477.01

Provision for taxation -

Profit / (Loss) after Tax -2844.17 -3477.01

Add: Balance of Profit brought forward from previous year -3222.67 254.34

Profit available for appropriation -6066.84 -3222.67

Appropriation to: - -

Proposed Dividend on Equity Shares - -

Balance Carried over to the Balance Sheet -6066.84 -3222.67

2. TRANSFER TO RESERVES :

In view of the state of affairs of the company as highlighted herein, no amount is proposed to be transferred to reserves.

3. DIVIDEND

Your directors do not recommend any dividend for the year 2014-15 due to the performance of the company not meeting management expectations.

4. BUSINESS PERFORMANCE :

The business performance of the company was seriously affected owing to financial difficulties. The manufacturing facilities and the plant were not operational due to grave financial difficulties. Fixed expenses, interest charges and other expenses remained thus unabsorbed leading to incurring losses as given above.

5. PRESENT STATE OF AFFAIRS OF THE COMPANY :

The Company has been served with notice under SARFAESI Act for recovery of dues and presently the properties of the company including collaterals are under symbolic possession of the Bank. There was no plant and manufacturing facilities operations presently. The management's efforts are on to find solution to the problems of the company including willing potential investors.

6. CORPORATE HIGHLIGHTS :

Capacity Expansion :

The current capacity of the company's manufacturing facilities for the production of'vitrified tiles stand at 12000 sq. mtrs per day. There was no capacity expansion during the year under review.

7. SHARE CAPITAL & SUSPENSION OF TRADING IN SECURITIES :

A) Issue of equity shares with differential rights.

The Company has not issued any equity shares with differential rights during the year under review.

B) Issue of sweat equity shares

The Company has not issued any Sweat Equity Shares during the year under review.

C) Issue of employee stock options

The Company has not provided any Stock Option Scheme to the employees.

D) Provision of money by Company for purchase of its own shares by employees or by trustees for the benefit of employees

The Company has not bought back or provided for buyback of any of its securities during the year under review.

E) Issue of Bonus Shares

No Bonus Shares were issued during the year under review.

Presently the company's total issued, subscribed and paid up capital stands at Rs, 48,33,54,440/- The company's shares have been listed in the Bombay Stock Exchange Ltd. and The National Stock Exchange Ltd. Trading of securities of the Company remains suspended from the first week of May, 2015 in NSE for reasons of non/late compliance and non-payment of listing fees, fines, etc. as the company continued to be in financial difficulties. In BSE also call auction is suspended due to penal reasons. Listing fee arrears for 2013-14 and listing fee for 2014-15 is yet to pay.

8. PUBIC DEPOSITS :

The Company has neither accepted nor renewed any deposits from public within the meaning of Section 73 of the Companies Act, 2013 read with Companies (Acceptance of Deposits) Rules, 2014 during the year.

9. DETAILS OF SUBSIDIARY, JOINT VENTURE OR ASSOCIATES :

The names of each of the companies which have become or ceased to be its subsidiaries, joint ventures or associate companies during the year along with the details of their performance and financial position, to be mentioned separately: NIL

10. PARTICULARS OF LOAN, GUARANTEES OR INVESTMENTS UNDER SECTION 186 : NIL

There are no Loans, Guarantees and Investments covered under the provisions of Section 186 of the Companies Act, 2013.

11. LISTING :

The equity shares of the Company are listed with Bombay Stock Exchange (BSE), and National Stock Exchange (NSE).

12. AWARDS AND RECOGNITIONS :

During the year under review the company is not in receipt of any award or recognition.

13. HEALTH, SAFETY, AND ENVIRONMENT :

The Company is taking continuous steps and also developing environment friendly processes for effective resource management with specific focus to energy, water and basic raw materials. Monitoring and periodic review of the HSE Management System is done on a continuous basis with emphasis and focus given to safety at workplace. For better environment management operations, the Company has implemented a Management System complying with the requirements of ISO 14001:2004 for manufacturing of Vitrified Tiles.

14. QUALITY :

The company's products undergo different quality parameter checking and the Company continues to focus on delivering products and services that consistently meet customer's expectations.

15. EXTRACT OF ANNUAL RETURN :

Pursuant to the provisions of Section 134 (3) (a) of the Companies Act, 2013, an extract of the Annual Return in Form MGT-9 is given as Annexure 'F' forming part of this Report.

16. INSURANCE :

All the assets of the Company are adequately insured and the policies are valid and subsisting.

17. PARTICULARS OF THE EMPLOYEES :

Pursuant to Rule 5 of The Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company states that none of the employees of the Company who was in receipt of remuneration in excess of Rs. 60 Lacs, if employed throughout the year or Rs. 5 Lacs per month, if employed for part of the financial year or received remuneration in excess of that drawn by the MD/WTD/Manager & holding 2% or more of equity share capital of the Company (himself along with spouse & dependent children). Hence, the disclosure as required by above Rule are not given as none of the employees qualify for such disclosure.

18. EMPLOYEES STOCK OPTION SCHEME :

Pursuant to Rule 12(9) of The Companies (Share Capital and Debentures) Rules, 2014, the Company has no Employees Stock Option Scheme in force hence disclosures are not, for the time being, applicable to the Company.

19. DISCLOSURE UNDER THE SEXUAL HARASSMENT OF WOMEN AT WORKPLACE (PREVENTION, PROHIBITION AND REDRESSAL) ACT, 2013 :

Presently the company's properties including collaterals are under its commercial banker's symbolic possession and so the plants and allied manufacturing facilities are not operational. The Company has in place an Anti Sexual Harassment Policy in line with the requirements of The Sexual Harassment of Women at the Workplace (Prevention, Prohibition & Redressal) Act, 2013. Internal Complaints Committee will be set up to redress complaints received regarding sexual harassment when the company will be fully operational. All employees (permanent, contractual, temporary, trainees) are covered under this policy. During 2014-15 the company has not employed any women employee.

20. VIGIL MECHANISM :

The company established vigil mechanism for directors and employees to report genuine concerns. The vigil mechanism, Inter alia, provides for adequate safeguards against victimization of persons who use such mechanism and also makes provision for direct access to the Chairperson of the Audit Committee in appropriate or exceptional cases.

21. CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNING AND OUTGO: :

A) CONSERVATION OF ENERGY :

a) Energy Conservation steps taken :

Your Company continued to be committed to energy conservation in its manufacturing operations.

i) Some significant Energy conservation steps implemented in the recent past are:

1. The company took every necessary step towards reducing the consumption of energy.

2. The Company continued to reduce the firing cost of Tiles driers by effective recovery of waste heat for using in Roller Kilns and for this the company on a regular basis identified leakage points and necessary prevention / rectification is done / being done.

3. The Company made regular maintenance to plant and machinery in addition to design modifications in the machinery and allied equipments to aid in conservation of energy and improvement in operational efficiency.

4. The instructions of the energy auditor have been, disseminated throughout the manufacturing set ups with the objective of creating awareness towards effective conservation of energy and reduction of costs.

5. Majority of the instructions have been implemented leading to substantial savings in specific energy consumptions.

6. The Company also uses the energy saving techniques by using the waste steam converting into vapors and then reusing the same in cooling and filtering the Coal gas.

7. To reduce the company's Spray Dryer fuel cost further, the company imported new Coal Stove in the past.

8. The company also imported digital testing machines towards upgrading its laboratory last year.

ii) The steps taken by the company for utilizing alternate sources of energy ;

Presently the company's properties including collaterals are under its commercial banker's symbolic possession and so the plants and allied manufacturing facilities are not operational. Therefore, no steps were taken by the company for utilizing alternate sources of energy.

Hi) The capital investment on energy conservation equipment :

There were no capital investments on energy conservation equipment during financial year 2014-15 owing to the company's properties including collaterals under symbolic possession with its commercial banker. Also, the plants and allied manufacturing facilities were not operational during 2014-15.

B) TECHNOLOGY ABSORPTION :

Efforts made in technology absorption :

During year 2014-15 the Company continued to pursue its research and development efforts in the areas of product concept development, raw material usage giving priority to local contents and product features and product quality improvement, reduction in the Kiln cycling of Vitrified Tiles, etc. However, the plant remained mostly closed during 2014-15 owing to financial difficulties and presently the plant is closed consequent upon symbolic possession of the company's properties by the company's commercial banker. As a result, the company could not pursue its intended programs technology absorption front.

The benefits derived are reflected in the products of the company in the form of improved product features, quality, product life, and better hygienic contents in addition to the increased business opportunities for the company's product that may accrue in the periods ahead.

The company has not imported any Technology during the last three years reckoned from the beginning of the financial year.

The expenditure incurred on R & D :

The company's property is under symbolic possession of the company's commercial banker and the plant is closed presently and there is substantial uncertainty with respect to future plan of action. The company is presently in grave financial difficulties. No amount therefore has been spent on R &D during the financial year 2014-15.

Foreign exchange Earnings and Outgo :

There are no Foreign Exchanges earned in terms of actual inflows during the financial year 2014-15. Also there are no Foreign Exchange outgoes during the financial year 2014-15 in terms of actual outflows.

22. RISK MANAGEMENT POLICY : .

During the year 2014-15, the Board of Directors developed and implemented risk management policy for the company including identification of elements of risk which in the opinion of the board might threaten the existence of the company. The Company's Audit Committee terms of reference include evaluation of risk management systems and they are satisfied themselves that systems of risk management are robust and defensible.

The company periodically reviews its risk assessment and minimization procedures so as to ensure that executive management controls risk through means of a properly defined framework. Executive management of the company periodically places before the Audit Committee risk identification report and risk mitigation measures. Subject to the company's properties and collaterals now under the symbolic possession of the company's commercial bankers, the properties of the company are adequately insured from risk and where risk transfer is not practicable, such risks are retained and effectively controlled as per the Risk Management Policy of the Company.

23. CORPORATE SOCIAL RESPONSIBILITY :

Pursuant to the requirements of Section 135 (1) of the Companies Act, 2013, the Company states that the company is, for the year 2014-15, not meeting the criteria mentioned in the said section. Therefore the Company has not constituted any Corporate Responsibility Committee during the financial year 2014-15 and the composition of such committee not disclosed. Subject to the present state of affairs of the company, the company will constitute a Corporate Social Responsibility (CSR) Committee, as soon as the company's financial condition is improved, which shall formulate and recommend to the Board, a CSR Policy indicating the activities to be undertaken by the company as well as the amount of expenditure to be incurred on the activities as mentioned in the policy.

24. INDUSTRIAL / HUMAN RELATIONS :

The Industrial relations during the year under review continue to remain cordial between the workers and management. The Management appreciates the employees of all cadres for their dedicated service to the Company, and expects continued support for higher level of productivity in achieving the targets set for the future. The Company continued its efforts in the HR policies and processes to further its performance.

25. MANAGEMENT DISCUSSION AND ANALYSIS REPORT :

Management Discussion and Analysis Report as required under the Listing Agreement with the Stock Exchanges is attached as Annexure 'A'.

26. DIRECTORS :

In accordance with the provisions of the Companies Act, 1956 and the Articles of Association of the Company-

i) Mr. Kantibhai M Pethapara, Director of the Company, retires by rotation and, being eligible, offers himself for re-appointment.

ii) Mr. Girishbhai M Pethapara, Whole-time Director is being reappointed for a further term of three years effective from 1st October, 2015.

iii) Mr Kantibhai M Pethapara, Managing Director, is being reappointed for a further term of three years effective from 1st October, 2015.

iv) Mr. Jayantibhai M Pethapara, Director and Mr Ashvin H Bopaliya, Independent Director, resigned during the year 2014-15 w.e.f. 15.12.2014.

Appropriate resolution for the appointment of the aforesaid Director is being moved at the ensuing Annual General Meeting for your approval.

27. NUMBER OF MEETINGS OF THE BOARD OF DIRECTORS :

Pursuant to the requirements of Section 134 of the Companies Act, 2013, The Board of Directors met 07 (Seven) times during the year. The details of the Board Meetings and the attendance of the Directors are provided in the Corporate Governance Report attached hereto which forms part of this Report.

28. BOARD EVALUATION / INDEPENDENT DIRECTORS MEETING :

During the year under review, the Independent Directors met on February 14, 2015, inter alia, to discuss:

1. Evaluation of the performance of Non Independent Directors and the Board of Directors as a Whole;

2. Evaluation of the performance of the Chairman of the Company, taking into account the views of the Executive and Non Executive Directors.

3. Evaluation of the quality, content and timelines of flow of information between the management and the Board that is necessary for the Board to effectively and reasonably perform its duties.

All the independent Directors were present at the meeting.

Manner of evaluation: Presently the company is in financial distress. Two of the directors already resigned. Auditors have expressed high uncertainty as to the status of going concern. Subject to these state of affairs, a framework for evaluation has been prepared and based on the framework, questionnaire has been made including different specific topics of evaluation and setting out different parameters / criteria against which the different topics as to the Board and its committees, Chairman and non-independent directors, have been evaluated, both individually and collectively, based on inputs received from directors and internal sources.

Performance of the Independent Directors was evaluated by the Peer group basis as per the evaluation criteria determined by the Nomination Committee, which inter alia, includes the following:

* Clear accountability

* More independent view

* More time to devote to task

* Other leadership skills and experiences

* Contribution to the development of (i) Strategy and (ii) risk management.

* Follow up on matters on which the independent directors expressed concern

* Relationship with other board members, the company secretary and senior management

* How actively and successfully do they refresh their knowledge and skill

* Skill gaps

29. APPOINTMENT / RE-APPOINTMENT OF INDEPENDENT DIRECTOR :

Pursuant to Section 149 (10) of the Companies Act, 2013, the Company discloses that -

Shri Vasant A Kaila (DIN: 02680103), was appointed in the annual general meeting held on 29th September, 2014, as an Independent Director of the Company to hold office for 3 (three) consecutive years for a term up to the conclusion of 18th Annual General Meeting of the Company in the calendar year 2017.

Shri Vijay M Vidja (DIN: 02680111), was appointed in .the Annual General Meeting held on 29th September, 2014,as an Independent Director of the Company to hold office for 3 (three) consecutive years for a term up to the conclusion of 18th Annual General Meeting of the Company in the calendar year 2017.

There are no re-appointments of independent director at the ensuing annual general meeting.

30. CHANGE IN THE COMPOSITION OF THE BOARD :

Pursuant to Section 168(1) of the Companies Act, 2013 read with Rule 8(5)(iii) of The Companies (Accounts) Rules, 2014,the details of directors or key managerial personnel who were appointed or have resigned during the year:

During the year 2014-15, Mr. Jayantibhai M Pethapara, and Mr. Ashwin H Bopaliya, Directors, have resigned from the office of Directors effective from 15th December, 2014. The Board appreciated the services rendered by them to the Company.

Reason for resignation by Mr. J M Pethapara, Director: Owing to financial difficulties the company is not in operation presently. Besides, the Company's commercial Banker had taken over symbolic possession of the company. These unfortunate developments badly affected his physical health and mental condition and therefore he was unable to continue in the Board or contribute anything to the Board. Under those backgrounds he tendered his resignation from the Board as Whole Time Director."

Reason for resignation by Mr. A H Bopaliya, Director: Owing to financial difficulties the company is not in operation presently. Besides, the Company's commercial Banker had taken over symbolic possession of the company and the plant is closed. In view of these developments, he was not willing to be in the Board and therefore he tendered his resignation from the Board and its committees on his own interest and accord.

Shri Suresh S Dave, Company Secretary, resigned from the Company effective from 15th December, 2014.

Reason for resignation by Mr. Suresh S Dave, Company Secretary: Due to pre-occupation.

Declaration of fulfillment of independence *

Pursuant to Section 149 (7) of the Companies Act, 2013, the Company has received statement with respect to declaration of fulfillment of the criteria of independence by independent directors.

Details of equity share with differential rights

Pursuant to Rule 4(4) of The Companies (Share Capital and Debentures) Rules, 2014, the Company states that during the year 2014-15, the Company has not issued any equity shares with differential rights.

Details of Sweat equity shares

Pursuant to Rule 8(13) of The Companies (Share Capital and Debentures) Rules, 2014, the Company states that during the year 2014-15, the Company has not issued any sweat equity shares.

Composition of Audit Committee

Pursuant to the requirement of Section 177 (8) of the Companies Act, 2013, following is the composition of the Audit Committee for year 2014-15:

Mr. Vasant Avachar Kaila, -- Chairman

Mr. Mr Vijay Maganlal Vidja -- Member

Mr. Ashvin H Bopaliya - Member (resigned w.e.f.15.12.2015)

Mr. Kantibhai M Pethapara -- Member

The recommendations of the audit committee, have been accepted by the Board.

31. CORPORATE GOVERNANCE :

The disclosures as required under the Corporate Governance have been furnished as part of this report. Subject to the ongoing financial difficulties, the Company has taken the requisite steps to comply with the recommendations concerning Corporate Governance. A report on Corporate Governance together with a certificate of compliance from the Practicing Company Secretary, forms part of this report.

32. DIRECTORS' RESPONSIBILITY STATEMENT :

Pursuant to the requirements under section 134 (3) (c) and (5) of the Companies Act, 2013, the Board of Directors of the Company hereby state that -

(a) In the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

(b) The Directors had 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 loss of the company for that period;

(c) The Directors had taken proper and sufficient care for the maintenance Of adequate accounting records in accordance with the provisions of this Act for safeguarding the assets of the company and for preventing and detecting fraud and other irregularities;

(d) The Directors had prepared the annual accounts on a going concern basis; and (the auditors of the company have qualified that there is high uncertainty as to the going concern status of the company).

(e) The Directors had laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and were operating effectively.

33. STATUTORY AUDITORS :

Pursuant to provisions of Section 224 of the Companies Act, 1956, M/s SVK & Associates, Chartered Accountants, Ahmedabad , were the statutory auditors of the Company who hold office up to the conclusion of the this Annual General Meeting and they completed two terms of consecutive five years.

As per Section 139 (2) of the Companies Act, 2013, M/s G.P. Kapadia & Co., Chartered Accountants, Morbi, are being appointed as the new statutory auditors for a term of maximum five years from the conclusion of this AGM till the conclusion of the consecutive fifth annual general meeting, subject to ratification by Members at every annual general meeting. The Company has received a letter from M/s G.P. Kapadia & Co., Chartered Accountants, Morbi, to the effect that their re-appointment, if made, would be in accordance with the conditions prescribed under section139 (2) of the Companies Act, 2013 and they are not disqualified for such reappointment within the meaning of Section141 of the said Act.

The observation of the auditors referred to in the Auditors' Report have been suitably explained in the Notes on Accounts. *

34. AUDITORS' QUALIFICATION :

Auditors have qualified the financial statements about unutilized funds 6f equity preferential issue privately placed lying in ICD of Rs 27.57 Crores is pending for renewal / receipt from respective parties. In this context, the management, proceeding legally, filed civil suit in Morbi Court for recovery of the above amount.

Auditors have also qualified the financial statements with respect to the Going Concern Aspect due to various reasons. In this context the management is putting their best efforts to find potential investors who can take the company on track and thus afford going concern status to the company.

35. EXPLANATION OR COMMENTS ON QUALIFICATIONS, RESERVATIONS OR ADVERSE REMARKS OR DISCLAIMERS MADE BY THE AUDITORS :

The auditors in their report have qualified over going concern status of the company on the following grounds-

1. The short term borrowings of the company have been classified as NPA by the bank consequent to default in repayment of debt by the company.

2. Pending various statutory liabilities

3. Operational efficiency of the plant badly affected due to old technology based plant & machinery and also sale of certain machineries

4. Reduction in volume of sales operation resulting into cash losses owing to the financial operational and machinery related issues.

5. Various Contingent Liabilities not provided for.

6. Others like i) Power connection of the factory unit disconnected by the State Electricity Board ii) Bank has filed complain / legal suits on the company for sales of machineries / stock hypothecated to bank without its consent and also for recovery of its entire dues along with the interest iii) Differences in physical

verification of plant & machineries taken by bank and management of the company iv) Receivables/ advances and Payables/liabilities of th§ company are subject to confirmation of the concerned parties v) ongoing various litigations by government as well as non-government parties.

In this context, the management is putting their best efforts to find out solution to the problems of the company including willing potential investors who can take the company on track.

36. SECRETARIAL AUDIT :

Pursuant to the provisions of Section 204 of the Companies Act, 2013 read with the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company appointed M/s. Kavita Khatri & Associates, Company Secretaries in Practice to undertake the Secretarial Audit of the Company for the Financial Year 2014 15. The Secretarial Audit Report is given as Annexure 'D' forming part of this Report.

The Secretarial Auditors have given adverse comments in their reports with respect to the appointment of Women Director, Chief Financial Officer and Company Secretary. In this context the management reports that the company was served with notice under SARFAESI Act for recovery of dues and presently the properties of the company including collaterals are under symbolic possession of the bank. There was no plant and manufacturing facilities operations during the year under review or presently. In such a situation, the company is continuously confronting financial difficulties in appointing key managerial persons and to keep them remunerated. Besides, given the state of affairs of the company, no candidate for women director was willing to join the Board. However, the management's efforts are on to appoint key managerial persons.

37. ACKNOWLEDGEMENT :

Your Directors place on record their sense of appreciation for the co-operation received from all.

For and on behalf of Board of Directors

Sd/-

Place : Morbi Kantilal Maganlal Pethapara Date : 30th June, 2015 Managing Director DIN : 00055108

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Mar 31, 2014

The Members of Decolight Ceramics Limited

The Directors are pleased to present their report on the working of the company along with the Audited Accounts for the year ended 31st March, 2014:

Financial Performance:

The details of the financial performance of the company are appearing in the Balance sheet, Profit & Loss Account along with other financial statement.

Highlights are as under:- (Rs. In lacs) Particulars 2013-14 2012-13

Total Income from operations 1019.85 1711.30

Profit before considering Exceptional items, Prior Period Items, Interest, Depreciation and Taxation -1756.97 -534.46

Less: Interest & Financial Charges 498.37 549.28

Less: Depreciation 431.86 444.91

Profit / (Loss) before considering Exceptional Items, prior period Item and Tax -2687.20 -1528.65

Less: Exceptional Items 789.81 -

Profit / (Loss) after exceptional items and before prior period Item and tax -3477.01 -1528.65

Less: Prior period items - 36.33

Profit / (Loss) Before Tax -3477.01 -1564.98

Provision for taxation - 120.69

Profit / (Loss) after Tax -3477.01 -1444.29

Add: Balance of Profit brought forward from previous year 254.34 1698.64

Profit available for appropriation -3222.67 254.34

Appropriation to: - -

Proposed Dividend on Equity Shares - -

Balance Carried over to the Balance Sheet -3222.67 254.34



Dividend

Your directors do not recommend any dividend for the year 2013-14 due to the performance of the company not meeting management expectation.

Business Performance:

The business performance of the company was seriously affected owing to the volume of operations remained very low level due to financial difficulties. The production was restricted to only one kiln during the year under review. Production facilities remained closed mostly due to working capital difficulties. Plant efficiency has been consistently decreasing due to old machineries and technologies. Fixed expenses, interest charges and other expenses remained thus unabsorbed leading to incurring losses as given above.

The company has been served with notice under SARFAESI Act for recovery of dues and presently the properties of the company including collaterals are under symbolic possession of the bank. The management''s efforts are on to find solution to the problems of the company including willing potential investors.

Corporate highlights:

Capacity Expansion:

The current capacity of the company''s manufacturing facilities for the production of vitrified tiles stand at 12000 sq. mtrs per day. There was no capacity expansion during the year under review.

Share Capital

Presently the company''s total issued, subscribed and paid up capital stands at Rs. 48,33,54,440. The company''s shares have been listed in the Bombay Stock Exchange Ltd. and The National Stock Exchange Ltd.

Fixed deposits

Your Company has not invited/accepted any Fixed Deposits within the meaning of Section 58A of the Companies Act, 1956 and the Rules made there under.

Listing

The equity shares of the Company are listed with Bombay Stock Exchange (BSE), and National Stock Exchange (NSE). There are no arrears on account of payment of listing fees to the Stock Exchanges for year 2013-14. Listing fees and depositories charges for 2014-15 are yet to be paid due to financial difficulties.

Awards and Recognitions

During the year under review the company is not in receipt of any award or recognition.

Health, Safety, and Environment:

The Company is taking continuous steps and also developing environment friendly processes for effective resource management with specific focus to energy, water and basic raw materials. Monitoring and periodic review of the HSE Management System is done on a continuous basis with emphasis and focus given to safety at workplace. For better environment management operations, the Company has implemented a Management System complying with the requirements of ISO 14001:2004 for manufacturing of Vitrified Tiles.

Quality

The company''s products undergo different quality parameter checking and the company continues to focus on delivering products and services that consistently meet customers'' expectations.

Management Discussion and Analysis Report

Management Discussion and Analysis Report as required under the Listing Agreement with the Stock Exchanges is attached as Annexure ''A''.

Directors

i) Mr Kantibhai M Pethapara, Director of the Company, retires by rotation and, being eligible, offers himself for re-appointment.

ii) Mr Vasannt A Kaila, Mr Vijay M Vidja and Mr Ashwin H Bopaliya, Independent Directors, are being appointed under the Companies Act, 2013, Appropriate resolution for the appointment of the aforesaid Directors are being moved at the ensuing Annual General Meeting for your approval.

Corporate Governance

The disclosures as required under the Corporate Governance have been furnished as part of this report. The Company has taken the requisite steps to comply with the recommendations concerning Corporate Governance. A report on Corporate Governance together with a certificate of compliance from the Practicing Company Secretary, forms part of this report.

Directors'' Responsibility Statement

Pursuant to the requirements under section 217(2AA) of the Companies Act, 1956, the Board of Directors of the Company hereby state and confirm that

(a) In the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanations relating to material departure;

(b) The Directors have selected such accounting policies and have applied them consistently and have 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 loss of the Company for the year under review;

(c) The directors have taken proper and sufficient care for the 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.

The auditors in their report have emphasized doubts over going concern status of the company on the following grounds –

1. The short term borrowings of the company have been classified as NPA by the bank consequent to default in repayment of debt by the company.

2. Pending various statutory liabilities

3. Operational efficiency of the plant badly affected due to old technology based plant & machinery

4. Reduction in volume of sales operation resulting into cash losses owing to the financial operational and machinery related issues.

In this context, the management is putting their best efforts to find out solution to the problems of the company including willing potential investors who can take the company on track.

Auditors:

Pursuant to provisions of Section 224 of the Companies Act, 1956, M/s SVK & Associates, Chartered Accountants, Ahmedabad , were the statutory auditors of the Company who hold office up to the conclusion of the forthcoming Annual General Meeting.

As per Section 139 (2) of the Companies Act, 2013 they are eligible for re-appointment for a term of maximum one year from the conclusion of this AGM (15th AGM) to the conclusion of next (16th AGM) AGM. (since they have completed the term of nine years). The Company has received a letter from M/s SVK & Associates, Chartered Accountants, Ahmedabad, to the effect that their re- appointment, if made, would be in accordance with the conditions prescribed under section139 (2) of the Companies Act, 2013 and they are not disqualified for such reappointment within the meaning of Section141 of the said Act.

The observation of the auditors referred to in the Auditors'' Report have been suitably explained in the Notes on Accounts.

Auditors'' Qualification

Auditors have qualified the financial statements about unutilized funds of equity preferential issue privately placed lying in ICD of Rs. 27.57 Cr is pending for renewal / receipt from respective parties. In this context, the management, proceeding legally, has filed civil suit in Morbi Court for recovery of the above amount.

Insurance

All the assets of the Company are adequately insured and the policies are valid and subsisting.

Particulars Of The Employees:

Particulars of employees in accordance with provisions of Section 217 (2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975, as amended, are not given as none of the employees qualify for such disclosure.

Conservation of Energy, Technology Absorption and Foreign Exchange Earning and Outgo

A) Conservation of Energy

a) Energy Conservation measures taken:

Your Company continued to be committed to energy conservation in its manufacturing operations.

b) Some significant Energy conservation measures implemented in the recent past are:

1. The company took every necessary step towards reducing the consumption of energy.

2. The Company continued to reduce the firing cost of Tiles driers by effective recovery of waste heat for using in Roller Kilns and for this the company on a regular basis identified leakage points and necessary prevention / rectification is done / being done.

3. The Company made regular maintenance to plant and machinery in addition to design modifications in the machinery and allied equipments to aid in conservation of energy and improvement in operational efficiency.

4. The instructions of the energy auditor have been disseminated throughout the manufacturing set ups with the objective of creating awareness towards effective conservation of energy and reduction of costs.

5. Majority of the instructions have been implemented leading to substantial savings in specific energy consumptions.

6. The Company also uses the energy saving techniques by using the waste steam converting into vapors and then reusing the same in cooling and filtering the Coal gas.

7. To reduce the company''s Spray Dryer fuel cost further, the company imported new Coal Stove in the past.

8. The company also imported digital testing machines towards upgrading its laboratory last year.

c) Impact of the measures

Total power and fuel cost during the year was Rs. 883.46 Lakhs while the same was Rs. 1262.24 lakh in the last year against production of 5400 MT and 15325 MT of Vitrified Tiles respectively for year 2013-14 and 2012-13.

B) Technology absorption:

Efforts made in technology absorption:

a) Research & Development (R & D)

During year 2013-14 the Company continued to pursue its research and development efforts in the areas of product concept development, raw material usage giving priority to local contents and product features and product quality improvement, reduction in the Kiln cycling of Vitrified Tiles, etc. However, the plant remained mostly closed during 2013-14 owing to financial difficulties and presently the plant is closed consequent upon symbolic possession of the company''s properties by the company''s commercial banker. As a result, the company could not pursue its intended programs on R & D front.

Future Plan of action

The company''s property is under symbolic possession of the company''s commercial banker and the plant is closed presently and there is substantial uncertainty with respect to future plan of action.. In view of this reason, the Expenditure on R & D has not been planned.

b) Technology absorption, adaptation and innovation

Subject to above matters, the company is using Chinese and Spanish technologies in its manufacturing facilities since year 2004.

The benefits derived are reflected in the products of the company in the form of improved product features, quality, product life, and better hygienic contents in addition to the increased business opportunities for the company''s product that may accrue in the periods ahead.

The company has not imported any Technology during the last five years reckoned from the beginning of the financial year.

Industrial / Human Relations:

The Industrial relations during the year under review continue to remain cordial between the workers and management. The Management appreciates the employees of all cadres for their dedicated service to the Company, and expects continued support for higher level of productivity in achieving the targets set for the future. The Company continued its efforts in the HR policies and processes to further its performance.

Acknowledgement:

Your Directors place on record their sense of appreciation for the co-operation received from all.

For and on behalf of Board of Directors

Girishbhai M. Pethapara Chairman Place: Morbi (DIN : 00380910) Date: 25th August, 2014

---

Mar 31, 2013

To, The Members of Decolight Ceramics Limited

The Directors are pleased to present their report on the working of the company along with the Audited Accounts for the year ended 31st March, 2013:

Financial Performance:

The details of the financial performance of the company are appearing in the Balance sheet, Profit & Loss Account along with other financial statement.

Highlights are as under:-

(Rs. In lacs) Particulars 2012-13 2011-12

Total Income from operations 1711.30 6073.81

Profit before considering Exceptional items, Prior Period Items, Interest, Depreciation and Taxation -534.46 -182.83

Less: Interest & Financial Charges 549.28 589.08

Less: Depreciation 444.91 536.26

Profit / (Loss) before considering Exceptional Items, Prior Period Items and Tax 1528.65 -1308.17

Less: Exceptional Items -- -211.69

Profit / (Loss) after exceptional items and before prior period items and tax -1528.65 -1519.86

Less: Prior period items 36.33 --

Profit / (Loss) Before Tax -1564.98 -1519.86

Provision for taxation -120.69 -454.31

Profit / (Loss) after Tax -1444.29 -1065.55

Add: Balance of Profit brought forward from previous year 1698.64 2058.25

Profit available for appropriation 254.34 992.70

Add : Partly Paid Equity

Convertible Warrants Forfeited -- 705.93

Appropriation to: -- --

Proposed Dividend on Equity Shares -- --

Balance Carried over to the Balance Sheet 254.34 1698.64

Dividend

Your directors do not recommend any dividend for the year 2012-13 due to the performance of the company not meeting management expectation.

Business Performance:

As can be seen from the financial performance highlighted above, the company could achieve income from operations of only Rs. 17 Cr as against Rs. 60.74 Cr of year 2011-12. Because of the reduced volume of sales operations owing partly to persistent recessionary conditions and partly to restricting the production in one kiln only, operational and financial expenses remained unabsorbed leading to posting a loss after Tax of Rs. 14.44 Cr for the year 2012-13 as against the reported loss after Tax of Rs. 10.65 Cr for year 2011-12. Besides, ever since the catastrophic incident occurred to the company in year 2010- 11, the company''s business operations affected badly. This has resulted, in addition to deferring production in one of the kilns, increased cash flow problems coupled with production disruptions. Inadequate compensation from the insurance company and lack of working capital stemming from our ongoing financial difficulty to service our bankers highly impacted and further aggravated the company operations.

During the year 2012-13, production remained exclusively in one kiln only and therefore the capacity utilization was very lower. While the management already installed a new coal gas plant and the same is in operation presently, installation of another coal gas plant is also proposed. With the installation of the new coal gas plant, management expects increased fuel efficiency, higher capacity utilization and saving in cost, especially at a situation in which the power and fuel expenses of the company is mounting day by day due to the damage suffered machinery over consuming productive resources. The management has however taken technical solutions to overcome the issues and the same are being implemented.

It is anticipated that going steam the other kiln soon, the production activities of which has been deferred for the last two years, would contribute to increased utilization of productive capacity and increased sales turnover so as to make a turn around to absorb the losses accumulated all through the years and thus take the company on growth path.

Besides, the company has not carried out business of Aluminum Composite Panel due to non-viability of the operations owing to credit risk coupled with sales and marketing issues, henceforth it has sold substantial part of fixed assets of Aluminum Composite Panel manufacturing division.

Corporate highlights:

Capacity Expansion:

The current capacity of the company''s manufacturing facilities for the production of vitrified tiles stand at 12000 sq. mtrs per day. There was no capacity expansion during the year under review.

Share Capital

Presently the company''s total issued, subscribed and paid up capital stands at Rs. 48,33,54,440. The company''s shares have been listed in the Bombay Stock Exchange Ltd. and The National Stock Exchange Ltd.

Fixed deposits

Your Company has not invited/accepted any Fixed Deposits within the meaning of Section 58A of the Companies Act, 1956 and the Rules made there under.

Listing

The equity shares of the Company are listed with Bombay Stock Exchange (BSE), and National Stock Exchange (NSE). There are no arrears on account of payment of listing fees to the Stock Exchanges

Awards and Recognitions

During the year under review the company is not in receipt of any award or recognition.

Health, Safety, and Environment:

The Company is taking continuous steps and also developing environment friendly processes for effective resource management with specific focus to energy, water and basic raw materials. Monitoring and periodic review of the HSE Management System is done on a continuous basis with emphasis and focus given to safety at workplace. For better environment management operations, the Company has implemented a Management System complying with the requirements of ISO 14001:2004 for manufacturing of Vitrified Tiles.

Quality

The company''s products undergo different quality parameter checking and the company continues to focus on delivering products and services that consistently meet customers'' expectations. Quality consciousness through continual development and improvement of its all processes, procedures and systems has been inculcated throughout the plant of vitrified tiles unit. The Company has implemented a Management System complying with the requirements of ISO 9001: 2008 for manufacturing, supply and export of vitrified tiles. Strict quality control is maintained through raw materials, in line and finished products inspection.

Management Discussion and Analysis Report

Management Discussion and Analysis Report as required under the Listing Agreement with the Stock Exchanges is attached as Annexure ''A''.

Directors

In accordance with the provisions of the Companies Act, 1956 and the Articles of Association of the Company -

i) Mr Vijay Maganlal Vidja , Director of the Company, retires by rotation and, being eligible, offers himself for re-appointment.

ii) Mr Ashvin H Bopaliya, Director of the Company, retires by rotation and, being eligible, offers himself for re-appointment.

Appropriate resolutions for the appointment of the aforesaid Directors are being moved at the ensuing Annual General Meeting for your approval.

Corporate Governance

The disclosures as required under the Corporate Governance have been furnished as part of this report. The Company has taken the requisite steps to comply with the recommendations concerning Corporate Governance. A report on Corporate Governance together with a certificate of compliance from the Practicing Company Secretary, forms part of this report.

Directors'' Responsibility Statement

Pursuant to the requirements under section 217(2AA) of the Companies Act, 1956, the Board of Directors of the Company hereby state and confirm that

(a) In the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanations relating to material departure;

(b) The Directors have selected such accounting policies and have applied them consistently and have 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 loss of the Company for the year under review;

(c) The directors have taken proper and sufficient care for the 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.

Auditors:

SVK & Associates, Chartered Accountants, Ahmedabad, Firm No. 118564W, the Auditors of the Company, retire at the ensuing Annual General Meeting and '' being eligible, offer themselves for reappointment. The Company has received a copy of valid Peer Review Certificate issued by ICAI Board and letters from auditors to the effect that their reappointment, if made, would be within the prescribed limits under Section 224(1B) of the Companies Act, 1956 and that they are not disqualified for such reappointment within the meaning of Section 226 of the said Act. The observation of the auditors referred to in the Auditors'' Report have been suitably explained in the Notes on Accounts.

Auditors'' Qualification

Auditors have qualified the financial statements about unutilized funds of equity preferential issue privately placed lying in ICD of Rs. 28.32 Cr is pending for renewal / receipt from respective parties. In this context the management is following up the matter with the respective parties for renewal / receipt.

Cost Accounting Records

Your Company, being a listed Company, is required to maintain cost accounting records as per (Cost Accounting Records Rules 2011 prescribed by Central Government under section 209(1)(d) of the Companies Act, 1956. Accordingly, the company will be obtaining necessary Cost Compliance Certificate from Practicing Cost Accountants in conformity with legal requirements within the stipulated time.

Insurance

All the assets of the Company are adequately insured and the policies are valid and subsisting.

Particulars Of The Employees:

Particulars of employees in accordance with provisions of Section 217 (2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975, as amended, are not given as none of the employees qualify for such disclosure.

Conservation of Energy, Technology Absorption and Foreign Exchange Earning and Outgo

A) Conservation of Energy

a) Energy Conservation measures taken:

Your Company continues to be committed to energy conservation in its manufacturing operations.

b) Some significant Energy conservation measures implemented in the recent past are:

1. The company is taking every necessary step towards reducing the consumption of energy.

2. The Company continues to reduce the firing cost of Tiles driers by effective recovery of waste heat for using in Roller Kilns and for this the company on a regular basis identified leakage points and necessary prevention / rectification is done / being done .

3. The Company made regular maintenance to plant and machinery in addition to design modifications in the machinery and allied equipments to aid in conservation of energy and improvement in operational efficiency.

4. The instructions of the energy auditor have been disseminated throughout the manufacturing set ups with the objective of creating awareness towards effective conservation of energy and reduction of costs.

5. Majority of the instructions have been implemented leading to substantial savings in specific energy consumptions.

6. The Company also uses the energy saving techniques by using the waste steam converting into vapors and then reusing the same in cooling and filtering the Coal gas.

7. To reduce the company''s Spray Dryer fuel cost further, the company imported new Coal Stove in the past.

8. The company also imported digital testing machines towards upgrading its laboratory.

c) Impact of the measures

Total power and fuel cost during the year was Rs. 1262.24 lakhs while the same was Rs. 2911.48. lakh in the last year against production of 15325 MT and 51770 MT of Vitrified Tiles respectively for year 2012-13 and 2011-12.

B) Technology absorption:

Efforts made in technology absorption:

a) Research & Development (R & D)

1. The Company continues to pursue its research and development efforts in the areas of product concept development, raw material usage giving priority to local contents and product features and product quality improvement, reduction in the Kiln cycling of Vitrified Tiles, etc. and is adequately equipped with its own R&D Department with qualified manpower.

Benefits derived as a result of the above R & D

1 During the year under review, the company continued to use local clay and for this the Company has been receiving cooperation from Central Glass & Ceramic research Institute (CGCRI), Naroda, Ahmedabad, for the development of local Indian clay.

Consequently, local contents of the product increased and dependence on Ukraine Clay completely stopped.

2. The company replaced the old technology polishing line with the latest technology and longer length polishing line. This step continued to contribute improvement in quality, reduction in energy consumption, saving in working hours, and reduced use of abrasives leading to cost savings in production.

3. Reduction in the company''s Spray Dryer fuel cost because of importation and installation of new Coal Stove.

4. Regular overhauling and upgrading of the machinery resulted in improvement in the functioning of the machineries.

5. Routine and Preventive Maintenance carried out to its Auxilassing Calibrating Machine reflected improved quality and product life in the products of the company in addition to reduction in the consumption of abrasives and electricity.

6. The company uses CNG in its manufacturing facilities which promote environmental cleanliness, leads to more efficiency and less polluting.

7. The company already switched over to alternate "Petkoke" which is more efficient and less polluting.

8. The above measures continue to contribute conservation of resources and reduction in pollution and costs, productivity enhancement, improved product quality and eco-friendly products.

Future Plan of action

1. Introduction of two product variations in its product portfolio of vitrified tiles.

2. Introduction of Nano Technology backed machinery for manufacturing of high Nano quality Vitrified Tiles.

3. Drive to position the company''s products in untapped and potential markets.

Expenditure on R & D tentatively planned

a) Capital Expenditure Rs. 0.50 Cr

b) Recurring Rs. 0.50 Cr

c) Total Rs. 1.00 Cr

b) Technology absorption, adaptation and innovation

The company is using Chinese and Spanish technologies in its manufacturing facilities since year 2004.

The benefits derived are reflected in the products of the company in the form of improved product features, quality, product life, and better hygienic contents in addition to the increased business opportunities for the company''s product that may accrue in the periods ahead.

The company has not imported any Technology during the last five years reckoned from the beginning of the financial year.

C) Foreign Exchange Earning & Outgo

2012-13 2011-12

1. Total foreign Rs. 2,040,494 Rs. 343,915 exchange earned

2. Total foreign NIL NIL exchange used in lakhs

Industrial / Human Relations:

The Industrial relations during the year under review continue to remain cordial between the workers and management. The Management appreciates the employees of all cadres for their dedicated service to the Company, and expects continued support for higher level of productivity in achieving the targets set for the future. The Company continued its efforts in the HR policies and processes to further its performance.

Acknowledgement:

Your Directors place on record their sense of appreciation for the co-operation received from the Banks, Financial Institutions, Employees, Customers and Suppliers of the Company at all levels during the year under review.

For and on behalf of Board of Directors



Sd/-

Place : Morbi Girishbhai M. Pethapara

Date : 25th May, 2013 Chairman

---

Mar 31, 2012

The Directors are pleased to present their report on the working of the company along with the Audited Accounts for the year ended 31st March, 2012:

Financial Performance:

The details of the financial performance of the company are appearing in the Balance sheet, Profit & Loss Account along with other financial statement.

Highlights are as under:-

(Rs. In lacs)

Particulars 2011-12 2010-11

Total Income from operations 6073.81 14814.87

Profit before considering Exceptional items, Interest, Depreciation and Taxation -232.96 1229.33

Less: Interest & Financial Charges 589.08 606.03

Less: Depreciation 536.27 576.77

Profit / (Loss) before considering Exceptional Items and Tax -1308.17 101.27

Less: Exceptional Items 211.69 0.00

Profit / (Loss) after exceptional items and before taxation -1519.86 101.27

Provision for taxation 454.31 -22.85

Profit/(Loss) after Tax -1065.55 78.42

Less: Prior period items 0 0.00

Add: Balance of

Profit brought forward from previous year 2058.25 1979.83

Profit available for appropriation 992.70 2058.25

Appropriation to: -- --

Proposed Dividend on Equity Shares -- --

Balance Carried over to the Balance Sheet 992.70 2058.25

Dividend

Your directors do not recommend any dividend for the year 2011-12 due to unsatisfactory business performance.

Business Performance:

For the year ended 31st March, 2012, the total income from operations remained at Rs 6073.81 lakhs as against Rs 14814.87 lakhs for year 2010-11. On green power generation front, during the year under review the revenues were Rs 228.58 lakhs as against Rs 336.66 lakhs for the year ended 31st March, 2011. Overall for the year under review, the company reported a loss after tax of Rs 1065.55 lakhs as against the reported profit after tax of Rs 78.42 lakhs for the year ended 31st March, 2011.

During the year under review plant and machineries capacities remained under performed because of deep-rooted damages in them due to the natural calamity destruction during 2010-11. There were several production disruptions during 2011-12 and resultantly plant and machineries could perform only to the extent of 60% of productive capacity. Besides, because of the slowdown in construction sector all over India due to tight liquidity situation in the last quarter of year 2011-12, the management, after assessment of the market demand supply situation, deferred production in one of the kilns. Also the Ceramic Industry in general was not performing well because of the uncertain economic condition and bleak market conditions for ceramic products during the year under review stemming from concerns of growing business confidence in the backdrop of volatile global conditions.

Tiles production and sales revenue have thus been impacted; the company could not recover the expenses including the financial cost resulting in posting of loss after tax of Rs 1065.55 lakhs for the year under review. The impact of high increases in major inputs, such as materials, power and fuel, transportation charges, etc. and non-recovery of fixed costs and financial costs for the above reasons affected margin and profitability.

There was no production from the ACP project during the year under review. Also because of the disturbed cash flow position, the company had to exit fully from its wind power businesses. Consequently, the company commercial banker's and financial institution's exposure has been reduced to some extent.

Nevertheless, to make a turn-around in the immediate future, the management is introducing two different variations in its product portfolio. For this the management has made a market survey locally and several potential customers have evinced interests in the products. The management is confident that with the introduction of the two new products such as Terracota Vitrified Tiles and Parking Tiles, both the kilns will be operational and sales realization per scm for the company and total cost of ownership of tiles as far as customers are concerned will be better than other type of traditional tiles found in the market.

To optimize cost and giving added thrust to quality towards exceeding customers' expectations, the management has framed and will be implementing different business development measures which will go to reduce overall cost. and at the same time could aid in providing value added manufactured products to customers.

Also the management has already switched over to alternate fuel " Petcoke" which is more efficient and highly cost effective.

On marketing front, data gathered by Morbi tiles association and based on their study in the demand supply scenarios shows positive trends and tempo of activities in the construction and real estate sectors in the periods ahead. Therefore management anticipates building material sector which includes vitrified tiles to fare well in the periods ahead and so the industry in which the company is engaged to be encouraging.

With all those steps, it is anticipated that the company will be able to enhance productivity, capability and introduce innovative products and thus make sufficient revenue and profit margins in the periods ahead barring unprecedented economic and market conditions.

Corporate highlights:

Capacity Expansion:

The current capacity of the company's manufacturing facilities for the production of vitrified tiles stand at 12000 sq. mtrs per day.

There was no capacity expansion during the year under review.

Share Capital

Presently the company's total issued, subscribed and paid up capital stands at Rs 48,33,54,440. The company's shares have been listed in the Bombay Stock Exchange Ltd. and The National Stock Exchange Ltd.

Fixed deposits

Your Company has not invited/accepted any Fixed Deposits within the meaning of Section 58A of the Companies Act, 1956 and the Rules made there under.

Listing

The equity shares of the Company are listed with Bombay Stock Exchange (BSE), and National Stock Exchange (NSE) . There are no arrears on account of payment of listing fees to the Stock Exchanges

Awards and Recognitions

During the year under review the company is not in receipt of any award or recognition.

Health, Safety, and Environment:

The Company is taking continuous steps and also developing environment friendly processes for effective resource management with specific focus to energy, water and basic raw materials. Monitoring and periodic review of the HSE Management System is done on a continuous basis with emphasis and focus given to safety at workplace. For better environment management operations, the Company has implemented a Management System complying with the requirements of ISO 14001:2004 for manufacturing of Vitrified Tiles.

Quality

The company's products undergo different quality parameter checking and the company continues to focus on delivering products and services that consistently meet customers' expectations. Quality consciousness through continual development and improvement of its all processes, procedures and systems has been inculcated throughout the plant of vitrified tiles unit. The Company has implemented a Management System complying with the requirements of ISO 9001: 2008 for manufacturing, supply and export of vitrified tiles. Strict quality control is maintained through raw materials, in line and finished products inspection.

Management Discussion and Analysis Report

Management Discussion and Analysis Report as required under the Listing Agreement with the Stock Exchanges is attached as Annexure 'A'.

Directors

In accordance with the provisions of the Companies Act, 1956 and the Articles of Association of the Company -

i) Mr Kantibhai M Pethapara, Director of the Company, retires by rotation and, being eligible, offers himself for re-appointment.

ii) Mr Jayantibhai M Pethapara, Director of the Company, retires by rotation and, being eligible, offers himself for re-appointment.

Appropriate resolutions for the appointment of the aforesaid Directors are being moved at the ensuing Annual General Meeting for your approval.

The current term of Shri Girishbhai M Pethapara as Chairman and Managing Director, Shri Kantibhai M Pethapara as Joint Managing Director and Shri Jayantibhai M Pethapara as Whole-Time Director will be expiring on 30th September, 2012 and the Board of Directors have sought their reappointment in the respective positions for a period of three years effective from 1st October, 2012, as per the details appearing in the notice convening the AGM dated 30th May, 2012.

Corporate Governance

The disclosures as required under the Corporate Governance have been furnished as part of this report. The Company has taken the requisite steps to comply with the recommendations concerning Corporate Governance. A report on Corporate Governance together with a certificate of compliance from the Practising Company Secretary, forms part of this report.

Directors' Responsibility Statement

Pursuant to the requirements under section 217(2AA) of the Companies Act, 1956, the Board of Directors of the Company hereby state and confirm that

(a) In the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanations relating to material departure;

(b) The Directors have selected such accounting policies and have applied them consistently and have 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 loss of the Company for the year under review;

(c) The directors have taken proper and sufficient care for the 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.

Auditors:

SVK & Associates, Chartered Accountants, Ahmedabad, Firm No. 118564W, the Auditors of the Company, retire at the ensuing Annual General Meeting and ' being eligible, offer themselves for reappointment. The Company has received a copy of valid Peer Review Certificate issued by ICAI Board and letters from auditors to the effect that their reappointment, if made, would be within the prescribed limits under Section 224(1 B) of the Companies Act, 1956 and that they are not disqualified for such reappointment within the meaning of Section 226 of the said Act. The observation of the auditors referred to in the Auditors' Report have been suitably explained in the Notes on Accounts.

Insurance

All the assets of the Company are adequately insured and the policies are valid and subsisting.

Particulars Of The Employees:

Particulars of employees in accordance with provisions of Section 217 (2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975, as amended, are not given as none of the employees qualify for such disclosure.

Conservation of Energy, Technology Absorption and Foreign Exchange Earning and Outgo

A) Conservation of Energy

a) Energy Conservation measures taken:

Your Company continues to be committed to energy conservation in its manufacturing operations.

Cost Accounting Records

Your Company is required to maintain cost accounting records as per ( Cost Accounting Records Rules 2011 prescribed by Central Government under section 209(1 )(d) of the Companies Act, 1956. Accordingly, the company will be obtaining necessary Cost Compliance Certificate from Practicing Cost Accountants in conformity with legal requirements within the stipulated time.

Auditors' Qualification

Auditors have qualified the financial statements about unutilized funds of equity preferential issue privately placed lying in ICD of Rs. 28.47 Cr is pending for renewal / receipt from respective parties. In this context the management is following up the matter with the respective parties for renewal / receipt.

b) Some significant Energy conservation measures implemented in the recent past are:

1. The company is taking every necessary step towards reducing the consumption of energy.

2. Units generated in the company's windmills during year 2011-12 have been wheeled or banked through State grids.

3. The Company continues to reduce the firing cost of Tiles driers by effective recovery of waste heat for using in Roller Kilns and for this the company on a regular basis identified leakage points and necessary prevention / rectification is done / being done.

4. The Company made regular maintenance to plant and machinery in addition to design modifications and renovation in the machinery and allied equipments to aid in conservation of energy and improvement in operational efficiency.

5. The instructions of the energy auditor have been disseminated throughout the manufacturing set ups with the objective of creating awareness towards effective conservation of energy and reduction of costs.

6. Majority of the instructions have been implemented leading to substantial savings in specific energy consumptions.

7. The Company also uses the energy saving techniques by using the waste steam converting into vapors and then reusing the same in cooling and filtering the Coal gas.

8. To reduce the company's Spray Dryer fuel cost further, the company imported new Coal Stove in the past.

9. The company also imported digital testing machines towards upgrading its laboratory.

c) Impact of the measures

Total power and fuel cost during the year was Rs. 2911.48 lakhs lacs while the same was Rs. 2633. 22 lakh in the last year. During the year under review the company could generate wind power of Rs. 228.58 lakhs as against Rs. 336.66 in previous year.

B) Technology absorption:

Efforts made in technology absorption:

a) Research & Development (R & D)

1. The Company continues to pursue its research and development efforts in the areas of product concept development, raw material usage giving priority to local contents and product features and product quality improvement, reduction in the Kiln cycling of Vitrified Tiles, etc. and is adequately equipped with its own R&D Department with qualified manpower.

Benefits derived as a result of the above R&D

1 During the year under review, the company continued to use local clay and for this the Company has been receiving cooperation from Central Glass & Ceramic research Institute (CGCRI), Naroda, Ahmedabad, for the development of local Indian clay. Consequently, local contents of the product increased and dependence on Ukraine Clay completely stopped.

2. The company replaced the old technology polishing line with the latest technology and longer length polishing line. This step continued to contribute improvement in quality, reduction in energy consumption, saving in working hours, and reduced use of abrasives leading to cost savings in production.

3. Reduction in the company's Spray Dryer fuel cost because of importation and installation of new Coal Stove last year.

4. Regular overhauling and upgrading of the machinery resulted in improvement in the functioning of the machineries.

5. Routine and Preventive Maintenance carried out to its Auxilassing Calibrating Machine reflected improved quality and product life in the products of the company in addition to reduction in the consumption of abrasives and electricity.

6. The company uses CNG in its manufacturing facilities which promote environmental cleanliness, leads to more efficiency and less polluting.

7. The company already switched over to alternate "Petkoke" which is more efficient and less polluting.

8. The above measures continue to contribute conservation of resources and reduction in pollution and costs, productivity enhancement, improved product quality and eco-friendly products.

Future Plan of action

1. Introduction of two product variations in its product portfolio of vitrified tiles.

2. Introduction of Nano Technology backed machinery for manufacturing of high Nano quality Vitrified Tiles.

3. Drive to position the company's products in untapped and potential markets.

Expenditure on R & D tentatively planned

a) Capital Expenditure Rs. 0.50 Cr

b) Recurring Rs. 0.50 Cr

c) Total Rs. 1.00 Cr

b) Technology absorption, adaptation and innovation

The company is using Chinese and Spanish technologies in its manufacturing facilities since year 2004.

The benefits derived are reflected in the products of the company in the form of improved product features, quality, product life, and better hygienic contents in addition to the increased business opportunities for the company's product that may accrue in the periods ahead.

The company has not imported any Technology during the last five years reckoned from the beginning of the financial year.

Industrial / Human Relations:

The Industrial relations during the year under review continue to remain cordial between the workers and management. The Management appreciates the employees of all cadres for their dedicated service to the Company, and expects continued support for higher level of productivity in achieving the targets set for the future. The Company continued its efforts in the HR policies and processes to further its performance.

Acknowledgement:

Your Directors place on record their sense of appreciation for the co-operation received from the Banks, Financial Institutions, Employees, Customers and Suppliers of the Company at all levels during the year under review.

For and on behalf of Board of Directors

Sd/-

Place : Morbi Girishbhai M. Pethapara

Date : 30th May, 2012 Chairman

---

Mar 31, 2011

The Members of Decolight Ceramics Limited

The Directors are pleased to present their report on the working of the company along with the Audited Accounts for the year ended 31st March, 2011:

Financial Performance

The details of the financial performance of the company are appearing in the Balance sheet, Profit & Loss Account along with other financial statement.

Highlights are as under:- (Rs. In lacs)

Particulars 2010-11 2009-10

Total Income from operations 14478.53 8749.25

Profit before considering 1252.03 1053.85 Exceptional items, Interest, Depreciation and Taxation

Less: Interest & Financial Charges 606.03 772.75

Less: Depreciation 544.73 521.85

Profit / (Loss) before considering Exceptional Items and Tax 101.27 (240.75)

Less: Exceptional Items - 38.44

Profit / (Loss) after exceptional items and before taxation 101.27 (279.19)

Provision for taxation 22.85 (143.55)

Profit / (Loss) after Tax 78.42 (135.64)

Less: Prior period items – 0.17

Add: Balance of Profit brought forward from previous year 1979.83 2115.64

Profit available for appropriation 2058.25 1979.83

Appropriation to: – –

Proposed Dividend on Equity Shares – –

Balance Carried over to the Balance Sheet 2058.25 1979.83

Dividend

Your directors do not recommend any dividend for the year 2010-11 due to unsatisfactory business performance.

Business Performance

For the year ended 31st March, 2011, the revenue from Tiles, Building Materials and Allied Activities remained at Rs.14043.32 lakhs as against Rs. 8199.56 lakhs for year 2009-10. On green power generation front, during the year under review the revenues were Rs. 336.66 lakhs as against Rs. 549.69 lakhs for the year ended 31st March, 2010. Overall for the year under review, the company reported a profit before tax of Rs. 101.27 lakhs as against the reported loss of Rs. 240.75 lakhs for the year ended 31st March, 2010.

Though the company could manage volume growth in its Tiles, Building Materials & Allied Activities segments, the margins were affected because of the higher inputs cost and interest costs. Besides, the company also had to bear the brunt of natural calamity destruction on 17th of November, 2010 resulting in temporary shutdown of the plant and manufacturing facilities. Consequently, the company could regain its factory operations only from 1st January, 2011 onwards after the disaster. The revenues from wind power generation also impacted because of deteriorating performance of the 2.10 MW WTG. on which the company was compensated for shortfall in output generation during year 2009- 10. Ultimately, the management had to dispose off the 2.10 MW WTG during year end 2010-11. Further, due to shifting of the aluminium composite panel manufacturing facilities to other place and the time delay involved in the reinstallation process, during the year under review there was no aluminimum composite panel production. However, efforts are on to restart the production at the earliest.

During the year under review, the Company's vitrified tiles production capacity stood at 12000 sq. mtrs. per day. There was no capacity addition during the year.

Corporate highlights

Capacity Expansion

The current capacity of the company's manufacturing facilities for the production of vitrified tiles stand at 12000 sq. mtrs per day. There was no capacity expansion during the year under review. The present capacity of production is running on maximum efficiency.

The management has the plan to enhance the production capacity to 24,000 smpd.

Green Power

On Windmill Power Generation front, the gross generation of green power of comes to 60.00 lakh units for the year under review as against 81.31 lakhs units during year 2009-10. Units generated thereat have been wheeled or banked through State grids.

Allotment of shares on preferential basis

With the completion of the allotment of shares on preferential basis to non-promoters during October, 2010, presently the company's total issued, subscribed and paid up capital stands at Rs. 48,33,54,440. The company's shares have been listed in the Bombay Stock Exchange Ltd. and The National Stock Exchange Ltd.

Preferential Issue of convertible equity warrants

Pursuant to the Special Resolution passed by the Members in the 10th AGM and the in principle approval under clause 24(a) of the listing agreement received by the company from BSE and NSE, dated 18.11.2009 and 27.11.2009 respectively, the company allotted 28,237,500 equity convertible warrants on 8th December, 2009 at allotment money of Rs. 2.75 including a premium of Rs. 0.25 per warrant. Since the allottees have not exercised their right of conversion into equity shares within eighteen months from the date of allotment, as per SEBI ICDR Regulations, 2009 the warrants so issued stand lapsed. Accordingly, the company has communicated to both the stock exchanges.

Fixed Deposits

Your Company has not invited/accepted any Fixed Deposits within the meaning of Section 58A of the Companies Act, 1956 and the Rules made there under.

Listing

The equity shares of the Company are listed with Bombay Stock Exchange (BSE), and National Stock Exchange (NSE) . There are no arrears on account of payment of listing fees to the Stock Exchanges

Awards and Recognitions

During the year under review the company has received a Certificate from Universal Media Group, Creating Powerful Business Platforms, in appreciation of the company's valuable contribution to the tiles and ceramic industry and the company's presence at the index-ifj industry meet for the tile and ceramic industry, dated 14th March, 2011.

Health, Safety, and Environment

The Company is taking continuous steps and also developing environment friendly processes for effective resource management with specific focus to energy, water and basic raw materials. Monitoring and periodic review of the HSE Management System is done on a continuous basis with emphasis and focus given to safety at workplace. The Company has implemented a Management System complying with the requirements of ISO 14001:2004 for manufacturing of Vitrified Tiles.

Quality

The company's products undergo different quality parameter checking and the company continues to focus on delivering products and services that consistently meet customers' expectations. Quality consciousness through continual development and improvement of its all processes, procedures and systems has been inculcated throughout the plant of vitrified tiles unit. The Company has implemented a Management System complying with the requirements of ISO 9001: 2008 for manufacturing, supply and export of vitrified tiles. Strict quality control is maintained through raw materials, in line and finished products inspection.

Management Discussion and Analysis Report

Management Discussion and Analysis Report as required under the Listing Agreement with the Stock Exchanges is attached as Annexure 'A'.

Directors

In accordance with the provisions of the Companies Act, 1956 and the Articles of Association of the Company -

i) Mr Vasant A Kaila, Director of the Company, retires by rotation and, being eligible, offers himself for re-appointment.

ii) Mr Ashvin H Bopaliya, Director of the Company, retires by rotation and, being eligible, offers himself for re-appointment.

Appropriate resolutions for the appointment of the aforesaid Directors are being moved at the ensuing Annual General Meeting for your approval.

Corporate Governance

The disclosures as required under the Corporate Governance have been furnished as part of this report. The Company has taken the requisite steps to comply with the recommendations concerning Corporate Governance. A report on Corporate Governance together with a certificate of compliance from the Practising Company Secretary, forms part of this report.

Directors' Responsibility Statement

Pursuant to the requirements under section 217(2AA) of the Companies Act, 1956, the Board of Directors of the Company hereby state and confirm that

(a) In the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanations relating to material departure;

(b) The Directors have selected such accounting policies and have applied them consistently and have 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 of the Company for the year under review;

(c) The directors have taken proper and sufficient care for the 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.

Auditors

SVK & Associates, Chartered Accountants, Ahmedabad, Firm No. 118564W, the Auditors of the Company, retire at the ensuing Annual General Meeting and `being eligible, offer themselves for reappointment. The Company has received a copy of valid Peer Review Certificate issued by ICAI Board and letters from auditors to the effect that their reappointment, if made, would be within the prescribed limits under Section 224(1B) of the Companies Act, 1956 and that they are not disqualified for such reappointment within the meaning of Section 226 of the said Act. The observation of the auditors referred to in the Auditors' Report have been suitably explained in the Notes on Accounts.

Insurance

All the assets of the Company are adequately insured and the policies are valid and subsisting.

Particulars Of The Employees

Particulars of employees in accordance with provisions of Section 217 (2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975, as amended, are not given as none of the employees qualify for such disclosure.

Conservation of Energy, Technology Absorption and Foreign Exchange Earning and Outgo

A) Conservation of Energy

a) Energy Conservation measures taken:

Your Company continues to be committed to energy conservation in its manufacturing operations.

Cost Accounting Records

Your Company is required to maintain cost accounting records in respect of wind power generation business and the Company has complied with the above requirement for the year ended 31st March 2011.

b) Some significant Energy conservation measures implemented in the recent past are:

1. The company is taking every necessary steps towards reducing the consumption of energy.

2. The captive power units of the company have been functioning properly. Units generated thereat have been wheeled or banked through State grids which augur well towards reduction in energy cost.

3. The Company continues to reduce the firing cost of Tiles driers by effective recovery of waste heat for using in Roller Kilns and for this the company on a regular basis identified leakage points and necessary prevention / rectification is done / being done .

4. The Company made regular maintenance to plant and machinery in addition to design modifications in the machinery and allied equipments to aid in conservation of energy and improvement in operational efficiency.

5. The instructions of the energy auditor have been disseminated throughout the manufacturing set ups with the objective of creating awareness towards effective conservation of energy and reduction of costs.

6. The Company also uses the energy saving techniques by using the waste steam converting into vapors and then reusing the same in cooling and filtering the Coal gas.

7. To reduce the company's Spray Dryer fuel cost further, the company imported new Coal Stove.

c) Impact of the measures

Total fuel cost during the year was Rs. 2633.23 lacs while the same was Rs. 2764.85 lacs in the last year. During the year under review the company could generate 60 lakh units as against 81.31 lakhs units of wind power in previous year. The total revenue implication is Rs. 336.66 lakhs as against Rs. 549.69 lakhs of previous year.

Following are the details of power cost per ton of production:

Year Production Total Power Power cost (Tons) Cost incurred per ton /Rs. / Rs. (Net of (Net of wind wind power) power)

Vitrified Tiles Unit / MT

2005-06 33466 128,247,057 3832.16

2006-07 40583 161,802,924 3986.96 2007-08 53928 212,304,984 3936.75

2008-09 47159 221,340,254 4693.00

2009-10 61981 220,078,014 3550.73

2010-11 56684 229,656,472 4051.52

Aluminium Composite Panels Unit / Sq Mtr

2008-09 31890 Sq/Mtr 12,63,249 39.61/Sq Mtr

2009-10 40703 Sq/Mtr 14,38,241 35.34/Sq Mtr

2010-11 Nil - -

B) Technology absorption

Efforts made in technology absorption:

a) Research & Development (R & D)

1. The Company continues to pursue its research and development efforts in the areas of product concept development, raw material usage giving priority to local contents and product features and product quality improvement, reduction in the Kiln cycling time of Vitrified Tiles, etc. and is adequately equipped with its own R&D Department with qualified manpower.

Benefits derived as a result of the above R & D

1. During the year under review, the

company continued to use local clay and for this the Company has been receiving cooperation from Central Glass & Ceramic research Institute (CGCRI), Naroda, Ahmedabad, for the development of local Indian clay. Consequently, local contents of the product increased and dependence on Ukraine Clay completely stopped.

2. The company replaced the old technology polishing line with the latest technology and longer length polishing line. This step continued to contribute improvement in quality, reduction in energy consumption, saving in working hours, and reduced use of abrasives leading to cost savings in production.

3. Reduction in the company's Spray Dryer fuel cost because of importation and installation of new Coal Stove

4. Regular overhauling and upgrading of the machinery resulted in improvement in the functioning of the machineries.

5. Routine and Preventive Maintenance carried out to its Auxilassing Calibrating Machine reflected improved quality and product life in the products of the company in addition to reduction in the consumption of abrasives and electricity.

6. The company uses CNG in its manufacturing facilities which promote environmental cleanliness, leads to more efficiency and less polluting.

7. The above measures continue to contribute conservation of resources and reduction in pollution and costs, productivity enhancement, improved product quality and eco-friendly products.

Future Plan of action

1. Introduction of Nano Technology backed machinery for manufacturing of high Nano quality Vitrified Tiles.

2. Drive to position the company's products in untapped and potential markets.

Expenditure on R & D tentatively planned

a) Capital Expenditure Rs. 2.50 Cr

b) Recurring Rs. 0.50 Cr

c) Total Rs. 3.00 Cr

b) Technology absorption, adaptation and innovation

The company is using Chinese and Spanish technologies in its manufacturing facilities since year 2004.

The benefits derived are reflected in the products of the company in the form of improved product features, quality, product life, and better hygienic contents in addition to the increased business opportunities for the company's product that may accrue in the periods ahead.

The company has not imported any Technology during the last five years reckoned from the beginning of the financial year.

C) Foreign Exchange 2010-11 2009-10 Earning & Outgo

1. Total foreign exchange earned Rs. 10,80,986 4,09,446

2. Total foreign exchange used Rs. in lakhs 298.39 501.76

Industrial / Human Relations:

The Industrial relations during the year under review continue to remain cordial between the workers and management. The Management appreciates the employees of all cadres for their dedicated service to the Company, and expects continued support for higher level of productivity, cost optimisation and better delivery systems with greater concerns on health, safety and environment. The Company continued its efforts in the HR policies and processes to further its performance.

Acknowledgement:

Your Directors place on record their sense of appreciation for the co-operation received from the Banks, Financial Institutions, Employees, Customers and Suppliers of the Company at all levels during the year under review.

For and on behalf of Board of Directors Sd/- Girishbhai M. Pethapara Chairman

Place : Morbi Date : 26th August, 2011

---

Mar 31, 2010

The Directors are pleased to present their report on the working of the company along with the Audited Accounts for the year ended 31st March, 2010:

Financial Performance

The details of the financial performance of the company are appearing in the Balance sheet, Profit & Loss Account along with other financial statement.

Highlights are as under:-

(Rs. In lacs)

Particulars 2009-10 2008-09

Total Income from operations 8749.25 7272.15

Profit before considering

Exceptional items, Interest,

Depreciation and Taxation 1053.85 1439.73

Less: Interest & Financial

Charges 772.75 649.44

Less: Depreciation 521.85 482.70

Profit / (Loss) before

considering Exceptional

Items and Tax (240.75) 307.59

Less: Exceptional Items 38.44 96.48

Profit/(Loss) after exceptional

items and before taxation (279.19) 211.11

Provision for taxation (143.55) (71.13)

Profit / (Loss) after Tax (135.64) 282.25

Less: Prior period items 0.17 17.74

Add: Balance of Profit

brought forward from

previous year 2115.64 1851.13

Profit available for

appropriation 1979.83 2115.64

Appropriation to: - -

Proposed Dividend on

Equity Shares - -

Balance Carried over to the

Balance Sheet 1979.83 12115.64

Dividend

Your directors do not recommend any dividend for the year 2009-10 due to unsatisfactory financial performance.

Business Performance

After the severe slowdown witnessed in 2008-09 on account of recession the world over, the year 2009-10 turned out to be year of recovery. Spurred by the economic revival in the domestic market, for the year ended 31st March, 2010, the company could post an increase of 20% in sales turnover and the net sales / income from operations stood at Rs 8749 lakhs as against Rs 7272 lakhs in the year 2008-09. On green power generation front, during the year under review the company could generate 81.31 lakh units as against the previous year figure of 78.02 lakhs units of wind power. The total revenue implication is Rs 549.69 lakhs as against Rs 404.79 lakhs of previous year.

However, to come out of the recession situation as prevailed in year 2008-09, the company opened up about 32 representative sales depots in different part of the country involving substantial expenditure in the initial year of set up with the hope of augmenting sales and increasing operating and net profit margins. Some of the depots however turned out to be non-viable which had partly contributed the company incurring losses. The management has now decided to close down the non-viable depots. Besides, to compete with the competition in the wake of increase in capacities, the company had to reduce the prices of the products which impacted realization and margin. With continuous focus on improving all round efficiencies and lowering costs, Board of Directors anticipates profitability and growth during year 2010-11.

During the year under review, the Companys vitrified tiles production capacity stood at 12000 sq. mtrs. per day. There was no capacity addition during the year.

Following is the Companys year wise Turnover for the last five years.

Corporate highlights

Capacity Expansion:

The current capacity of the companys manufacturing facilities for the production of vitrified tiles stand at 12000 sq. mtrs per day. There was no capacity expansion during the year under review. The present capacity of production is running on maximum efficiency.

Looking to the robust growth in construction activities nowadays, the management has the plan to enhance the production capacity to 16,000 smpd.

Green Power

On Windmill Power Generation front, your directors are pleased to inform that the company has already installed and commissioned two WTG of 1.25MW each and another one WTG OF 2.10 MW at Village: Kadoli, Tal.: Abdasa, Dist: Kutch, Gujarat, whereby taking the total Wind Mill Power Generation capacity to 4.60 MW. The gross generation of green power comes to 81.31 lakh units for the year under review as against 78.02 units during year 2008-09. Units generated thereat have been wheeled or banked through State grids.

Environmental Priorities

As part of environmental programme, the Company was contemplating development of three Clean Development Mechanism Projects involving a) 4.6 MW Wind Power Project; b) Fuel switch from fossil fuel based producer gas to Natural Gas; and c) Fuel switch over from fossil fuel to biomass. It was earlier expected that the projects become fully functional before 31st March 2009. In this context, the Company has received Host Country Approval from the Ministry of Environment & Forests, New Delhi, for all these projects in August - October 2008. While the Projects are under Third Party evaluation at present, it is anticipated that it would take some more time to complete the entire procedural formalities before being eligible to get registration from United Nations Framework Convention on Climate Change.

Aluminium Composite Panel

Aluminum Composite Panels (ACP) is one of the constructions related innovative products being used to decorate outer front of the commercial complexes. Air ports and other commercial buildings. The Company has started Commercial Production of its Aluminium Composite Panel (ACP) Unit in the last week of May 2008. The present capacity of the unit is 25,000 Sq. Ft. per day. With the signs of revival of the economy already in place, I am confident that avenues for growth and development in this new area of business for the company will be available in the coming periods.

Share capital

With the completion of the Initial Public Offering of equity shares in June 2007, presently the companys total issued, subscribed and paid up capital stands at Rs 18,33,54,440. The companys shares have been listed in the Bombay Stock Exchange Ltd. and The National Stock Exchange Ltd. Your Directors confirm that all due Annual Listing Fees and Annual Custodial Fees have been paid.

During the year under review the company increased its authorized share capital base from Rs 25 Crores divided in to equity shares of Rs 10 each to Rs 100 Crores divided in to equity shares of Rs 10 each.

Allotment of equity convertible warrants

During the year under review, pursuant to the in principle approval under clause 24(a) of the listing agreement received by the company from BSE and NSE, dated 18.11.2009 and 27.11.2009 respectively, the company allotted 28,237,500 equity convertible warrants on 8th December, 2009 to non-promoters at allotment money of Rs 2.75 including a premium of Re 0.25 per warrant in conformity with SEBI (ICDR) Regulations, 2009 for preferential issue. The tenure of conversion of the warrants is eighteen months from the date of allotment of warrants.

Fixed deposits

Your Company has not invited/accepted any Fixed Deposits within the meaning of Section 58A of the Companies Act, 1956 and the Rules made there under.

Awards And Recognitions

Apart from receiving the certificate / shield from the Supdt. of Central Excise, Morbi Range, Morbi, dated 12.05.2009 for acquiring the 2nd position / 4th position among all the vitrified tiles units / all the tiles units, for Central Excise duty payment for the year 2008-09; the Company has not received any award or recognition during the year under review.

Health, Safety, and Environment :

The Company is taking continuous steps and also developing environment friendly processes for

effective resource management with specific focus to energy, water and basic raw materials. Monitoring and periodic review of the HSE Management System is done on a continuous basis. The Company is committed to strengthen pollution prevention and strives to provide a safe and healthy environment. The Company has implemented a Management System complying with the requirements of ISO 14001:2004 for manufacturing of Vitrified Tiles.

Quality

The companys products undergo different quality parameter checking and the company continues to focus on delivering products and services that consistently meet customers expectations. Quality consciousness through continual development and improvement of its all processes, procedures and systems has been inculcated throughout the plant of vitrified tiles unit. The Company has implemented a Management System complying with the requirements of ISO 9001: 2008 for manufacturing, supply and export of vitrified tiles.

Management Discussion and Analysis Report

Management Discussion and Analysis Report as required under the Listing Agreement with the Stock Exchanges is attached as Annexure A.

Directors

Your Directors wish to place on record that Dr KN Maiti, Mr Gaurang Thoriya, and Mr Rajendra Dhamasana, Directors of the Company, have resigned from directorship during May 2009, October 2009 and January, 2010 respectively. Your Directors wish to record their deep appreciation for the services rendered by them as Directors of the company.

Your Board appointed Mr Vijaybhai Maganlal Vidja and Mr Vasant Avacharbhai Kaila as Additional Directors with effect from 19th June, 2009 and they have been appointed as regular Directors (Independent) in the Annual General Meeting held on 7th of September, 2009.

Also the Board appointed Mr Ashvin H Bopaliya as Additional Director, on 1st January, 2010 and he holds the office up to the date of the forthcoming Annual General Meeting. Notice pursuant to Section 260 of the Companies Act, 1956 has been received by the company from a Member proposing his candidature as Director. Considering that the Company will benefit from his continuance as Director, his appointment is being recommended.

In accordance with the provisions of the Companies Act, 1956 and the Articles of Association of the Company, Shri Kantibhai M Pethapara, Director, and Shri Vijaybhai Maganlal Vidja, Director, retire by rotation at the forthcoming Annual General Meeting and are eligible for reappointment.

Appropriate resolutions for the appointment of the aforesaid Directors are being moved at the ensuing Annual General Meeting for your approval.

Corporate Governance

The disclosures as required under the Corporate Governance have been furnished as part of this report. The Company has taken the requisite steps to comply with the recommendations concerning Corporate Governance. A report on Corporate Governance together with a certificate of compliance from the Practising Company Secretary, forms part of this report.

Directors Responsibility Statement

Pursuant to the requirements under section 217(2AA) of the Companies Act, 1956, the Board of Directors of the Company hereby state and confirm that (a) In the preparation of the annual accounts,

the applicable accounting standards have been followed along with proper explanations relating to material departure;

(b) The Directors have selected such accounting policies and have applied them consistently and have 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 loss of the Company for the year under review;

(c) The directors have taken proper and sufficient care for the 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.

Auditors:

SVK & Associates, Chartered Accountants, Ahmedabad, Firm No. 118564W, the Auditors of the Company, retire at the ensuing Annual General Meeting and being eligible, offer themselves for reappointment. The Company has received a copy of valid Peer Review Certificate issued by ICAI Board and letters from auditors to the effect that their reappointment, if made, would be within the prescribed limits under Section 224(1 B) of the Companies Act, 1956 and that they are not disqualified for such reappointment within the meaning of Section 226 of the said Act. The observation of the auditors referred to in the Auditors Report have been suitably explained in the Notes on Accounts.

Insurance

All the assets of the Company are adequately insured and the policies are valid and subsisting.

Particulars Of The Employees:

Particulars of employees in accordance with provisions of Section 217 (2A) of the Companies Act, 1956, read with Companies (Particulars of Employees) Rules, 1975, as amended, are not given as none of the employees qualify for such disclosure.

Acknowledgement:

Your Directors place on record their sense of appreciation for the co-operation received from the Banks, Financial Institutions, Employees, Customers and Suppliers of the Company at all levels during the year under review.

For and on behalf of Board of Directors

Sd/-

Place : Morbi Girishbhai M. Pethapara

Date : 30th August, 2010 Chairman