corporate profile · ms. garima vishnoi shares listed with stock exchange at the delhi stock...

CORPORATE PROFILE

BOARD OF DIRECTORSMr. Sanjiv Agarwal Executive Chairman & Whole Time DirectorMr. Rakesh Kumar Agarwal Managing DirectorMrs. Rajni Maheshwari Whole Time DirectorMr. Ram Shanker Agarwal Independent DirectorMr. Ram Prakash Gupta Independent DirectorMr. Keshav Behari Lall Independent Director

CHIEF EXECUTIVE OFFICERMr. Neeruj Nigam

CHIEF FINANCE OFFICERMr. Rajiv Kapoor

STATUTORY AUDITORSShashi Dinesh & Co.Chartered Accountants16/95, Canara Bank BuildingThe Mall, Kanpur-208001

COMPANY SECRETARYMs. Garima Vishnoi

SHARES LISTED WITH STOCK EXCHANGE ATThe Delhi Stock Exchange Ltd.DSE House3/1, Asaf Ali RoadNew Delhi-110003

The Bombay Stock Exchange Ltd.PJ Towers, Dalal Street, Mumbai-400001

BANKERSCanara BankF-19, Connaught Circus, New Delhi-110001

Oriental Bank of CommerceA-2/40, Safdarjung Enclave, New Delhi-110029

IDBI Bank Ltd.Videocon Tower, Jhandewalan Extn. New Delhi-110055

REGISTERED OFFICE101, DDA Market, Hargovind Enclave,Vikas Marg Extn., Delhi-110092

REGISTRAR & SHARE TRANSFER AGENTBeetal Financial & Compurter Services Pvt. Ltd.Beetal House 3rd Floor, 99Madangir, Behind Local Shopping CentreNear Dada Harsukhdas MandirNew Delhi-110062

Contents ............................................................ Page

Chairman Speech ...................................................... 1

Notice ......................................................................... 2

Directors’ Report ........................................................ 7

Corporate Governance ............................................. 12

Management Discussion and Analysis Report ......... 21

Auditors’ Report ........................................................ 25

Balance Sheet .......................................................... 28

Profit & Loss Account ............................................... 29

Schedules to Accounts ............................................. 30

Notes to the Accounts .............................................. 35

Cash Flow Statement ............................................... 41

Balance Sheet Abstract ............................................ 42

1

Tirupati Inks LimitedChairman Speech

Ladies and Gentlemen,

I have great pleasure in welcoming you to the 27th Annual General Meeting of your Company and sharing with youthe highlights of another year of great achievement.

During the financial year 2010-11, your company entered the capital market with the Further Public Offer, (FPO) ofRs.51.50 Crores, equity shares, through 100% Book Building Process. At the outset, I would like to take the opportunityto thank all the investors for their overwhelming response which was evident from the fact that the issue wasoversubscribed by 8.84 times, thereby making it a grand success. We feel great in experiencing the trust and confidencereposed by our esteemed shareholders with an increased sense of responsibility, and assure them that we shallshoulder the same with utmost care and sense of accountability.

The Printing Industry Growth is linked to the GDP growth of the country. The demand for the printing ink has becomethe vital aspect in sustaining the market growth. Printing Ink market domestically continued to grow at about 12%, amarket of about Rs. 17 billion saw augmenting its turnover on the back of stable growth and the overall Indianeconomic stability in its user industries such as FMCG, media, flexible packaging and publishing. Printing Ink industryhas witnessed an encouraging growth in domestic market during the year under review. The growth of the printingink sector including that of rotogravure and flexographic inks has been very fast.

The demand for the printing ink has become the vital aspect in sustaining the market growth. A diversified customerbase ensures a wide distribution for the Company’s products. Apart from direct sale of products to the customers,the company has also appointed distributors and consignee agents at different locations for product distribution. Wehave appointed new distributors in Lagos, Dubai and Srilanka for the international markets and in Uttaranchal forIndian markets.

I would like to offer my sincere thanks to our employees for their outstanding commitment and hard work for thesustained growth of the Company. I also place my sincere gratitude for the support of my colleagues, our customers,business associates, shareholders, Members of the Board, Central Government, State Governments, FinancialInstitutions and Banks. ‘Persistence, belief, action and teamwork will be our tools to achieve our goals. I know wehave all, but all that is needed is their further implementation in the face of economic challenges and the victory, amsure, will be ours.’

With Warm RegardsFor Tirupati Inks Ltd

Sanjiv AgrawalExecutive Chairman

Tirupati Inks Limited

2

NOTICE

Notice is hereby given that the Twenty Seventh Annual General Meeting of Tirupati Inks Limited will be held onTuesday, 27th September, 2011 at 11:00 A.M. at Lok Kala Manch, 20, Lodhi Institutional Area, Lodhi Road, New Delhito transact the following business:

Ordinary Business1. To receive, consider and adopt the Audited Balance Sheet of the Company as at 31st March 2011 and Profit and

Loss Account for the financial year ended on that date together with the Reports of the Auditors and Directorsthereon.

2. To appoint a Director in place of Mr Ram Shanker Agarwal, who retires by rotation and being eligible offershimself for re-appointment.

3. To appoint a Director in place of Mr Ram Prakash Gupta, who retires by rotation and being eligible offers himselffor re-appointment.

4. To appoint the Statutory Auditors of the Company to hold office from the conclusion of this Annual GeneralMeeting until the conclusion of the next Annual General Meeting and fix their remuneration. The retiring auditorsM/s Shashi Dinesh & Co., Chartered Accountants, Kanpur, being eligible offer themselves for re-appointment.

Special Business:5. To consider and, if thought fit, to pass, with or without modification(s), the following resolution as an Ordinary

Resolution:“Resolved That Mr Keshav Behari Lall, who was appointed as an Additional Director to hold office till the dateof the Annual General Meeting be and is hereby appointed as Director of the Company, whose office shall beliable to determination through retirement by rotation.”

6. To consider and, if thought fit, to pass, with or without modification(s), the following resolution as OrdinaryResolution:“Resolved That pursuant to the provisions of Sections 198, 269, 309, 310, 311 read with Schedule XIII of theCompanies Act, 1956 and other applicable provisions, if any (including any statutory modifications or re-enactments thereof, for the time being in force) & provisions of the Articles of Association of the Company andother applicable provisions, if any, the consent of the members be and is hereby accorded for appointment of MrSanjiv Agarwal, as a Whole Time Director designated as Executive Chairman of the Company with effectfrom 1st September, 2011 on the terms and conditions as mentioned below and with the liberty to the Board ofDirectors to alter and vary the terms and conditions including the remuneration so as not to exceed the limitsspecified in the Schedule XIII of the Companies Act,1956.Designation : Executive ChairmanTenure : from 1st September, 2011 till 31st August, 2016Remuneration : Monthly remuneration of Rs 1,00,000 (Rupees One Lacs only) whether paid as

Salary, allowance(s), perquisites or a combination thereof.

Resolved further that the following perquisites will not be included in the aforesaid remuneration:a. Contribution to provident fund, superannuation fund or annuity fund to the extent these either singly or

put together are not taxable under the Income-tax Act, 1961;b. Gratuity payable at a rate not exceeding half a month’s salary for each completed year of service; andc. Encashment of leave at the end of tenure.

Resolved further that payment/ re-imbursement of telephone and/ or mobile phone(s) bills, conveyance, fuelexpenses or other out of pocket expenses incurred in course of the official duties will not be included in theaforesaid remuneration.Resolved further that in the event of loss, absence or inadequacy of profits, the aforesaid remuneration shallbe the minimum remuneration.Resolved further that the Board of Directors and the Remuneration Committee of the Company be and arehereby severally authorised to fix such remuneration and to work out various components of the remunerationpackage as it may deem fit and proper within the overall limits of the remuneration as approved above.Resolved further that the Board of Directors of the Company (including any committee/sub-committee of theBoard) be and is hereby authorised to take all necessary steps to give effect to the aforesaid resolution.”

3

Tirupati Inks Limited7. To consider and, if thought fit, to pass, with or without modification(s), the following resolution as an Ordinary

Resolution:“Resolved That pursuant to the provisions of Sections 198, 269, 309, 310, 311 read with Schedule XIII of theCompanies Act, 1956 and other applicable provisions, if any (including any statutory modifications or re-enactments thereof, for the time being in force) & provisions of the Articles of Association of the Company andother applicable provisions, if any, the consent of the members be and is hereby accorded for appointment ofMrs Rajni Maheshwari as Whole Time Director of the Company with effect from 1st September, 2011 on theterms and conditions as mentioned below and with the liberty to the Board of Directors to alter and vary theterms and conditions including the remuneration so as not to exceed the limits specified in the Schedule XIII ofthe Companies Act,1956.Designation : Whole Time DirectorTenure : from 1st September, 2011 till 31st August, 2016Remuneration : Monthly remuneration of Rs. 50,000 (Rupees Fifty Thousand only) whether paid as

Salary, allowance(s), perquisites or a combination thereof.Resolved further that the following perquisites will not be included in the aforesaid remuneration:

a. Contribution to provident fund, superannuation fund or annuity fund to the extent these either singly orput together are not taxable under the Income-Tax Act, 1961;

b. Gratuity payable at a rate not exceeding half a month’s salary for each completed year of service; andc. Encashment of leave at the end of tenure.

Resolved further that payment/ re-imbursement of telephone and/ or mobile phone(s) bills, conveyance, fuelexpenses or other out of pocket expenses incurred in course of the official duties will not be included in theaforesaid remuneration.Resolved further that in the event of loss, absence or inadequacy of profits, the aforesaid remuneration shallbe the minimum remuneration.Resolved further that the Board of Directors and the Remuneration Committee of the Company be and arehereby severally authorised to fix such remuneration and to work out various components of the remunerationpackage as it may deem fit and proper within the overall limits of the remuneration as approved above.Resolved further that the Board of Directors of the Company (including any committee/sub-committee of theBoard) be and is hereby authorised to take all necessary steps to give effect to the aforesaid resolution.”

8. To consider and, if thought fit, to pass, with or without modification(s), the following resolution as an OrdinaryResolution:“Resolved That pursuant to the provisions of Sections 198, 269, 309, 310, 311 read with Schedule XIII of theCompanies Act, 1956 and other applicable provisions, if any (including any statutory modifications or re-enactments thereof, for the time being in force) & provisions of the Articles of Association of the Company andother applicable provisions, if any, the consent of the members be and is hereby accorded for appointment of MrRakesh Kumar Agarwal as Managing Director of the Company with effect from 1st September, 2011 on theterms and conditions as mentioned below and with the liberty to the Board of Directors to alter and vary theterms and conditions including the remuneration so as not to exceed the limits specified in the Schedule XIII ofthe Companies Act,1956.Designation : Managing DirectorTenure : from 1st September, 2011 till 31st August, 2016Remuneration : Monthly remuneration of Rs 52,000 (Rupees Fifty Two thousand only) whether paid

as Salary, allowance(s), perquisites or a combination thereof.Resolved further that the following perquisites will not be included in the aforesaid remuneration:

a. Contribution to provident fund, superannuation fund or annuity fund to the extent these either singly orput together are not taxable under the Income-tax Act, 1961;

b. Gratuity payable at a rate not exceeding half a month’s salary for each completed year of service; andc. Encashment of leave at the end of tenure.

Resolved further that payment/ re-imbursement of telephone and/ or mobile phone(s) bills, conveyance, fuelexpenses or other out of pocket expenses incurred in course of the official duties will not be included in theaforesaid remuneration.


4

Resolved further that in the event of loss, absence or inadequacy of profits, the aforesaid remuneration shallbe the minimum remuneration.Resolved further that the Board of Directors and the Remuneration Committee of the Company be and arehereby severally authorised to fix such remuneration and to work out various components of the remunerationpackage as it may deem fit and proper within the overall limits of the remuneration as approved above.Resolved further that the Board of Directors of the Company (including any committee/sub-committee of theBoard) be and is hereby authorised to take all necessary steps to give effect to the aforesaid resolution.”

9. To consider and, if thought fit, to pass with or without modification, the following resolution as a Special Resolution:“Resolved that pursuant to the provisions of section 61 of the Companies Act 1956, the Securities & ExchangeBoard of India (Issue of Capital & Disclosure Requirements) Regulations, 2009 and other applicable provisions,if any, consent of the Members of the Company be and is hereby given to the Board of Directors of the Company(hereinafter referred to as “the Board” which expression shall be deemed to include any Committee constituted/to be constituted by the Board to exercise its powers, including the powers conferred by this Resolution) toamend, vary or alter the Objects of the Issue and/or deployment of funds as mentioned in the Offer Documentdated September 20, 2010 issued by the Company at the time of its Further Public Offer (FPO) by, inter alia,altering the utilization of the issue proceeds, as the Board may consider necessary or expedient in the bestinterest of the Company, as described in the Explanatory Statement annexed to this Notice.Resolved further that the Board of Directors of the Company be and is hereby authorized to do all such acts,deeds, matters and things as may be considered necessary, expedient or incidental for the purpose of givingeffect to this resolution and to settle any question that may arise in this regard and incidental thereto, withoutbeing required to seek any further consent or approval of the shareholders.”

For and on behalf of the BoardFor Tirupati Inks Ltd

Date : 23rd August, 2011 Sanjiv AgrawalPlace : Delhi Executive Chairman

NOTES:

A. APPOINTMENT OF PROXY: A MEMBER ENTITLED TO ATTEND AND VOTE AT THE MEETING IS ENTITLEDTO APPOINT A PROXY TO ATTEND AND VOTE INSTEAD OF HIMSELF/HERSELF AND THE PROXY NEEDNOT BE A MEMBER OF THE COMPANY. THE PROXY FORM IN ORDER TO BE EFFECTIVE MUST BEDEPOSITED WITH THE COMPANY NOT LESS THAN 48 HOURS BEFORE THE TIME FIXED FORCOMMENCEMENT OF THE MEETING.

B. Corporate Members: Corporate Members intending to send their authorised representatives are requested tosend a duly certified copy of the Board Resolution authorizing the representatives to attend and vote at theAnnual General Meeting.

C. Members/Proxies attending the meeting are requested to bring their copy of Annual Report to the Meeting.

D. The register of members and share transfer books of the Company will remain closed from Monday, 26th

September, 2011 to Tuesday, 27th September, 2011 [both days inclusive]

E. Queries at the AGM: Queries proposed to be raised at the Annual General Meeting may be sent to the Companyat its registered office at least seven days prior to the date of AGM to enable the management to compile therelevant information to reply the same in the meeting.

F. Members are requested to notify any change in their address immediately to the Company at its RegisteredOffice.

G. Members are requested to quote their folio Nos. / DPID Nos. in all future correspondence(s) with the Company.

H. Inspection of Documents: Documents referred to in the Notice etc., are open for inspection at the registeredoffice of the Company at all working days except Saturdays between 11 A.M. and 2 P.M. up to the date of AnnualGeneral Meeting.

I. Explanatory Statement: Explanatory Statement as required under section 173(2) of the Companies Act, 1956,in respect of Special Business under item no. 5 to 9 is enclosed herewith.

5

Tirupati Inks LimitedExplanatory Statement pursuant to section 173(2) of the Companies Act, 1956Item No. 5:Mr Keshav Behari Lall was co-opted on the Board of the Company as Additional Director to hold office until the dateof ensuing annual general meeting.

The Company has received notice in writing along with the requisite deposit under Section 257 of the CompaniesAct, 1956 proposing the candidature of Mr Keshav Behari Lall for the office of Director of the Company in the ensuingAnnual General Meeting.

The Board recommends the proposed resolution at item no 5 for adoption of members in the larger interest of theCompany.

None of the Directors of the company except Mr Keshav Behari Lall himself is interested and concerned in theproposed resolution.

Item No. 6:The term of Mr Sanjiv Agarwal as the Whole-time Director of the Company has expired on 31st August, 2011. MrSanjiv Agarwal had rendered various valuable services to the Company during his tenure as Whole-time Director.The board of directors has appointed Mr Sanjiv Agarwal as Whole Time Director designated as Executive Chairmanof the Company w.e.f. 1st September, 2011 with increased remuneration as approved by the Remuneration Committeeof the Board. In terms of Section 198, 269, 309, 310 and 311 read with Schedule XIII of the Companies Act, 1956 theappointment of Whole Time Director requires member’s approval. Accordingly, the resolution is placed before themembers for their consideration and approval. The Remuneration Committee has already approved the remuneration.The Board recommends the proposed resolution for adoption in the larger interest of the Company.

The aforesaid explanatory statement for item no. 6 should also be deemed to be notice of the abstract for terms ofappointment and payment of remuneration to Mr Sanjiv Agarwal as Whole Time Director under section 302 of theCompanies Act 1956.

None of the directors of the Company except Mr Sanjiv Agarwal himself is concerned or interested in the proposedresolution.

Item No. 7:The term of Mrs Rajni Maheshwari as the Whole-time Director of the Company has expired on 31st August, 2011.Mrs Rajni Maheshwari had rendered various valuable services to the Company during her tenure as Whole-timeDirector. The board of directors has appointed Mrs Rajni Maheshwari as Whole Time Director of the Company w.e.f.1st September, 2011 with increased remuneration as approved by the Remuneration Committee of the Board. Interms of Section 198, 269, 309, 310 and 311 read with Schedule XIII of the Companies Act, 1956 the appointmentof Whole Time Director requires member’s approval. Accordingly, the resolution is placed before the members fortheir consideration and approval. The Remuneration Committee has already approved the remuneration. The Boardrecommends the proposed resolution for adoption in the larger interest of the Company.

The aforesaid explanatory statement for item no. 7 should also be deemed to be notice of the abstract for terms ofappointment and payment of remuneration to Mrs Rajni Maheshwari as Whole Time Director under section 302 ofthe Companies Act 1956.

None of the directors of the Company except Mrs Rajni Maheshwari herself is concerned or interested in the proposedresolution.

Item No. 8:The term of Mr Rakesh Kumar Agarwal as the Managing Director of the Company has expired on 31st August, 2011.Mr Rakesh Kumar Agarwal had rendered various valuable services to the Company during his tenure as ManagingDirector. The board of directors has appointed Mr Rakesh Kumar Agarwal as Managing Director of the Companyw.e.f. 1st September, 2011 with increased remuneration as approved by the Remuneration Committee of the Board.In terms of Section 198, 269, 309, 310 and 311 read with Schedule XIII of the Companies Act, 1956 the appointmentof Managing Director requires member’s approval. Accordingly, the resolution is placed before the members for theirconsideration and approval. The Remuneration Committee has already approved the remuneration. The Boardrecommends the proposed resolution for adoption in the larger interest of the Company.


6

The aforesaid explanatory statement for item no. 8 should also be deemed to be notice of the abstract for terms ofappointment and payment of remuneration to Mr Rakesh Kumar Agarwal as Managing Director under section 302 ofthe Companies Act 1956.

None of the directors of the Company except Mr Rakesh Kumar Agarwal himself is concerned or interested in theproposed resolution.

Item No. 9:The Company has raised money through FPO in terms of the Offer Document dated 20th September, 2010. TheObjects of the Issue were as under:1. Setting up facility for manufacturing of Speciality Inks and Ink Concentrates;2. Capital Expenditure on Lab Equipments for Existing Facilities;3. Proposed Acquisitions;4. Augmenting Working Capital Resources;5. General Corporate Purposes; and6. Meeting the Expenses of the Issue

Under the aforesaid objects of the Issue, inter alia, a sum of Rs. 500 lacs was earmarked for acquisitions andanother Rs. 500 lac was earmarked for General Corporate Purposes. While the Company was in the process ofimplementation of the new manufacturing facilities at Greater Noida, it suffered a major setback on account of fire atits Kanpur factory, which completely destroyed the manufacturing facilities at Kanpur. The Board of Directors is of theopinion that instead of rebuilding the Factory at Kanpur, it makes better business sense to take care of the lostcapacities in the new capacities being built at Greater Noida. Under the changed circumstances, the Board ofDirectors now feels that it is desirable to spend more on the Capacity Expansion to include more machines to createlarger capacities.

During recent period, the Board of Directors has also identified good business opportunities in Middle East andNorth Africa with acceptance of its products in these markets. Your Directors feel that in due course of time, theCompany will need to have a local manufacturing facility in the aforesaid region to effectively service Middle Eastand North Africa as also exploit trading opportunities available there. The overseas business set-up may be structuredas Branch Office or Wholly Owned Subsidiary or Joint Venture as is deemed fit by the Board.

The Company also requires more working capital for its growing business. To ensure better utilisation of resources,part of the Issue Proceeds is being utilised for working capital pending disbursement of need based working capitalby the Bankers.

In view of the above, the Board of Directors is of the opinion that it is in the larger interest of the Company that themoney earmarked for acquisitions and for general corporate purposes in the aforesaid Offer Document be utilisedfor additional capital expenditure required in Greater Noida Factory, establishing manufacturing setup in overseasand/or working capital requirements of Indian or Overseas business.

In terms of section 61 of the Companies Act, 1956, approval from Members of the Company is required to modifyutilization of FPO proceeds. The Board of Directors recommends the Resolution for approval.

None of the Directors of the Company is, any way, deemed to be concerned or interested in the aforesaid resolution.

For and on behalf of the BoardFor Tirupati Inks Ltd


7

Tirupati Inks LimitedDIRECTORS’ REPORT

Dear Members,Your Directors have pleasure in presenting this 27th Annual Report of your Company together with the AuditedAnnual Accounts for the financial year ended 31st March 2011.

Financial Highlights (Rs. in lacs)Particulars Year Ended Year Ended

31.03.2011 31.03.2010Total Income 10486.75 7523.09Total Expenditure 10152.01 7226.86Profit / (Loss) Before Tax 334.74 296.23Less: Provision for Income Tax 75.83 65.58

Adjustments Relating to Previous Year 8.36 1.76Interest on Tax 0.65 3.00Provision of Deferred Tax 0.00 10.47

Add: Excess Provision for Income Tax W/Back for AY 10-11 0.12 0.00Provision for Deferred Tax Written Back 3.21 0.00Profit / (Loss) After Tax 253.23 215.42Paid-up Share Capital 1515.24 317.56Reserve & Surplus 4435.48 405.57

Year in RetrospectYour company has registered all around progress during the year under review. The company is committed to makeitself in international standards of quality, operational performance, efficiency and customer care. The highlights ofour performance for the year 2010-11 are:

a The Gross Turnover of the company for financial year 2010-11 increased to Rs.9825.13 Lacs as against Rs.7176.22 Lacs in the corresponding previous financial year, registering a growth of 37%.

b Net Profit has increased from Rs.215.42 Lacs in the financial year 2009-10 to Rs.253.23 Lacs in the financialyear 2010-11 registering an increase of 17.55% due to better sales realization.

Your Directors are putting in their best efforts to improve the performance of the Company. The operational performanceof the Company has been comprehensively covered in the Management Discussion and Analysis Report.

During the financial year 2010-11, your company entered the capital market with the Further Public Offer, (FPO) ofRs.51.50 Crores, by issue of 11976744 equity shares of Rs. 10/- each, through 100% Book Building Process wherein9300000 shares were allotted to shareholders and 2676744 shares were allotted to the promoters of the company.These shares were allotted at a premium of Rs. 33/- each. Subsequent to the FPO your company’s shares standlisted on Bombay Stock Exchange Limited, in addition to Delhi Stock Exchange Limited. Your directors take thisopportunity to thank all the investors for their overwhelming response which was evident from the fact that the issuewas oversubscribed by 8.84 times, thereby making it a grand success. We feel great in experiencing the trust andconfidence reposed by our esteemed shareholders with an increased sense of responsibility, and assure them thatwe shall shoulder the same with utmost care and sense of accountability.

MATERIAL CHANGES ETC.Save as mentioned elsewhere in this Report, no material changes and commitments affecting the financial positionof the Company have occurred between the end of the financial year of the Company-31st March, 2011 and the dateof this Report.

DIVIDENDThe Board of Directors of your Company have decided to retain and plough back the profits into the business of theCompany. Thus no dividend is being recommended for this year to cope with the unfortunate fire event at Kanpur.


8

PUBLIC DEPOSITSDuring the year under report, your Company did not accept any deposits from the public in terms of the provisionsof section 58A of the Companies Act, 1956.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND OUTGOa. Conservation of Energy & Technology Absorption: Information as required under Section 217(1)(e) of

the Companies Act, 1956, read with the Companies (Disclosure of Particulars in the Report of Board ofDirectors) Rules, 1988, regarding conservation of energy, technology absorption and foreign exchangeearnings and outgo, is given in Annexure A, forming part of this report.

b. Export Activities: The product of the company which is printing ink was exported to the overseas market.The Company exports the printing inks to various countries viz., Nigeria, Turkey, Malaysia, Mauritius, Jordan,Italy, etc. Our export revenue from Inks during the year ending March 31, 2011 was Rs 285.34 lacs (FOBvalue)

c. Foreign Exchange Earnings and Outgo: The Company had earned foreign exchange by way of export ofproducts as per the annexure given along with this report during the year under review.

PARTICULARS OF EMPLOYEESDuring the financial year under review, none of the Company’s employees was in receipt of remuneration as prescribedunder section 217(2A) of the Companies Act, 1956, read with the Companies (Particulars of Employees) Rules,1975, and hence no particulars are required to be disclosed in this Report.

FIRE INCIDENT AT THE KANPUR UNIT OF THE COMPANYThe company witnessed an unfortunate fire incident at the factory premises of Kanpur unit, in the early hours of 21st

March, 2011.There was a devastating fire breakout that engulfed the entire factory premises including the Plant andMachinery, Stock of Raw Material and Finished Products and caused severe damage to the Land and Building. Thecompany has taken up the matter with United India Insurance Company. However, all the properties stocks,machineries and building were fully insured. The loss is nearly covered by Insurance and the net loss after the claimis not going to be significant. The Insurance Company has appointed the Surveyors and the Insurance Claim is in thefinal stage of being settled.

FUTURE PROSPECTS AND OUTLOOK OF THE COMPANYThe Global printing ink market of USD 14.5 billion is split evenly between North America, Europe and Asia-Pacific.While the North American and European sales have flattened out, the Asia-Pacific region continues to grow at a fastpace of about 8%, and should soon become the largest region in terms of ink consumption, driven by economicgrowth in China, India and other key countries.

Printing Ink market domestically continued to grow at about 12%, a market of about Rs. 17 billion saw augmenting itsturnover on the back of stable growth and the overall Indian economic stability in its user industries such as FMCG,media, flexible packaging and publishing. Printing Ink industry has witnessed an encouraging growth in domesticmarket during the year under review. The growth of the printing ink sector including that of rotogravure and flexographicinks has been very fast.

The demand for the printing ink has become the vital aspect in sustaining the market growth. A diversified customerbase ensures a wide distribution for the Company’s products. Apart from direct sale of products to the customers,the company has also appointed distributors and consignee agents at different locations for product distribution. Wehave appointed new distributors in Lagos, Dubai and Srilanka for the international markets and in Uttaranchal forIndian markets.

DIRECTORSAfter the last Annual General Meeting, Shri Chander Prakash Agarwal has resigned from the Board w.e.f. 6th October,2010 and Shri Keshav Behari Lall was appointed as additional director w.e.f 6th October, 2010. In terms of theprovisions of the Companies Act, 1956, he shall hold office until the date of the ensuing Annual General Meeting. Hisappointment as ordinary director of the Company is placed before the members for consideration. The Boardrecommends the resolution for adoption by the members.

9

Tirupati Inks LimitedIn accordance with the provisions of the Companies Act, 1956 and the Company’s Articles of Association, Shri RamShanker Agarwal and Shri Ram Prakash Gupta is liable to retire by rotation and being eligible offer themselves forre-appointment. Directors recommend their re-appointment.

The brief resumes of the Directors who are to be re-appointed, the nature of their expertise in specific functionalareas, names of companies in which they have held directorships, committee memberships/chairmanships, theirshareholding, etc. are furnished in the Corporate Governance Report.

AUDITORSM/s Shashi Dinesh & Co., Chartered Accountants, Statutory Auditors of the Company hold office until the conclusionof the ensuing Annual General Meeting and being eligible offer themselves for re-appointment. A certificate undersection 224(1) of the Companies Act, 1956 regarding their eligibility for the proposed re-appointment has beenobtained from them. Your Directors recommend their re-appointment.

AUDITORS’ REPORTThe Auditors have made the following observations in their report:

“Subject to limitation of our scope of substantial verification of accounting records due to damage in fire as mentionedin para 1 & 2 of notes to accounts we believe that our audit provides a reasonable basis for our opinion.

DIRECTOR’S COMMENTThe notes to accounts are fully explanatory of the observations made by the Auditors with regard to the fire incidentwhich was beyond the control of your directors. We have carefully compiled the accounts after retrieval of data fromvarious external sources which were corroborated. The Audit Committee has closely co-ordinated the exercise andgone through the records in detail. The Board of Directors are satisfied with the amount of due diligence taken in re-compilation of the accounts records. Further, no major discrepancy has been found during on-going reconciliationof records with various parties.

DIRECTORS’ RESPONSIBILITY STATEMENTIn terms of the provisions of section 217(2AA) of the Companies Act, 1956, and to the best of their knowledge andbelief and according to the information and explanations obtained by them and save as mentioned elsewhere in thisReport, the attached Annual Accounts and the Auditors’ Report thereon, your Directors confirm that:

a. in preparation of the annual accounts, the applicable accounting standards have been followed and therehas been no material departure;

b. they have selected such accounting policies and applied them consistently and made judgments and estimatesthat are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company asat 31st March 2011 and of the profit of the Company for the period ended on that date;

c. they have taken proper and sufficient care for the maintenance of adequate accounting records in accordancewith the provisions of the Act for safeguarding the assets of the Company and for preventing and detectingfraud and other irregularities; and

d. they have prepared the Annual Accounts on a going concern basis.

STOCK EXCHANGE LISTINGThe shares of the Company are listed on Delhi Stock Exchange and post Further Public Offer (FPO) they standlisted at Bombay Stock Exchange as well. The listing fee for the financial year 2011-12 has already been paid to theBombay Stock Exchange and Delhi Stock Exchange.

DEPOSITORY SYSTEMYour Company’s equity shares are available for dematerialization through National Securities Depository Limitedand Central Depository Services (India) Limited.97.05% of the equity shares of your Company were held in dematform as on March 31, 2011.


10

CORPORATE GOVERNANCEYour Company believes that the great organizations are built on the foundation of good governance practices. Corporategovernance is all about effective management of relationship among constituents of the system, i.e. shareholders,management, employees, customers, vendors, regulatory bodies and the community at large.

As stipulated under Clause-49 of the listing agreement, the Management Discussion and Analysis Report and theCorporate Governance Report has been incorporated as separate section forming part of the Annual Report.

The compliance report on Corporate Governance and a certificate from M/s R & D Company Secretaries regardingcompliance of the conditions of Corporate Governance, as stipulated under Clause 49 of the Listing Agreement withthe Stock Exchanges, is attached herewith and forms part of this Annual Report.

Certificate from Managing Director and Chief Financial Officer, inter alia, confirming the correctness of the financialstatements, compliance with Company’s Code of Conduct, adequacy of the Internal Control measures and reportingof matters to the Audit Committee in terms of Clause 49 of the Listing Agreement with the Stock Exchanges, is alsoenclosed as a part of the Annual Report.

ACKNOWLEDGEMENTYour Directors are grateful and pleased to place on record their appreciation for the excellent support, trust, guidanceand cooperation extended & reposed by the all its stakeholders, employees, customers, Financial Institutions andBanks, various Government Departments, statutory & regulatory bodies and local authorities in the Company andlook forward to their continued patronage. The Board also expresses its appreciation of the understanding andsupport extended by the shareholders and employees of the Company

For and on behalf of the BoardFor Tirupati Inks Limited


11

Tirupati Inks LimitedAnnexure A

Annexure to the Directors’ ReportINFORMATION AS PER SECTION 217(1) (e) READ WITH COMPANIES (DISCLOSURE OF PARTICULARS IN THE REPORT OF BOARDOF DIRECTORS) RULES, 1988 AND FORMING PART OF THE DIRECTORS’ REPORT FOR THE YEAR ENDED 31st MARCH, 2011:

PARTICULARS AS PER FORM A: 2010-2011 2009-2010

A. POWER AND FUEL CONSUMPTION1. ELECTRICITY

(a) PURCHASED:Units (in lacs) 1.84 1.43Total amount (in lacs) 8.51 6.62Rate/Units (in Rs.) 4.62 4.62

(b) OWN GENERATION:(i) Through Diesel Generator

Ltrs (in lacs) 0.067 0.100Total amount (in lacs) 2.80 3.80Rate/Ltrs (in Rs.) 42.00 38.00

(ii) Through Steam Turbine/ Generator NIL NIL2. LIGHT DIESEL OIL / FURNACE OIL

Quantity (Kilo Ltrs.) NIL NILTotal Cost (in lacs) NIL NILAverage/Ltrs (in Rs.) NIL NIL

3. GASa. LPG GAS

Quantity (K.G.) NIL NILTotal Cost (in lacs) NIL NILAverage/ K.G. (in Rs.) NIL NIL

b. NATURAL GASQuantity (SCM) NIL NILTotal Cost (in lacs) NIL NILAverage/ SCM (in Rs.) NIL NIL

PARTICULARS AS PER FORM B: 2010-2011 2009-2010A. RESEARCH AND DEVELOPMENT (R & D)

(a) Specified Areas in which R & D carried out by the Company: NIL NIL(b) Benefits derived as a result of the above R & D : NIL NIL(c) Future plan of action NIL NIL(d) Expenditure on R & D

(i) Capital NIL(ii) Recurring NIL NIL(iii) Total NIL NIL(iv) Total R & D Expenditure as a percentage of total turnover NIL NIL

B. TECHNOLOGY ABSORPTION, ADOPTION AND INNOVATION(a) Efforts in brief, made towards Technology Absorption, Adaption and innovation: NIL NIL(b) Benefits derived as a result of the above efforts e.g., product improvement,

cost reduction, product development, import substitution etc., NIL NIL(c) In case of imported technology, (imported during

the last five years reckoned from the beginning ofthe financial year) following information may be furnished :i) Technology importe NIL NILii) Year of import NIL NILiii) Has technology been fully absorbed NIL NILiv) If not fully absorbed, areas where this has

not taken place, reason thereof and future plan of action NIL NILC. FOREIGN EXCHANGE EARNINGS AND OUT GO:

(a) Activities relating to exports, initiative taken toincrease exports, development of new export marketsfor products and services and export plans NIL NIL

(b) Total foreign exchange used Rs. 1290.65 Lacs Rs. 21.45 Lacs(c) Total foreign exchange earned Rs. 285.34 Lacs Rs. 422.46 Lacs


12

REPORT ON CORPORATE GOVERNANCE

Pursuant to Clause 49 of the Listing Agreement a Report on Corporate Governance is given below:

1. COMPANY’S PHILOSOPHY ON CORPORATE GOVERNANCEOur Company’s philosophy on Corporate Governance envisages attainment of highest levels of accountability,transparency, responsibility and fairness in all aspects of its operations. Our business culture and practices arefounded upon a common set of values that govern our relationships with customers, employees, shareholders,suppliers and the communities in which we operate. The Company believes that all its actions must serve theunderlying goal of enhancing overall shareholder value on a sustained basis.The Company is conscious of its responsibility as a good corporate citizen. The Company values transparency,professionalism and accountability.

2. BOARD OF DIRECTORSThe Company maintains an optimum combination of Executive, Non Executive and Independent Directors. TheBoard consists of total Six (6) directors on 31st March, 2011, out of which three (3) are independent. Mr SanjivAgarwal is the Executive Chairman cum Whole Time Director of the Company, Mr Rakesh Kumar Agarwal is theManaging Director and Mrs Rajni Maheshwari is the Whole Time Director of the Company. The Constitution ofthe Board as on 31st March 2011 is as follows:

Name of the Director & Category No. of positionsDesignation held in other Public Companies1

Board CommitteeMembership Chairmanship

Mr Sanjiv Agarwal Promoter & Executive Nil Nil NilChairman & Whole Time Director

Mr Rakesh Kumar Agarwal Promoter & Executive Nil Nil NilManaging Director

Mrs. Rajni Maheshwari Promoter & Executive Nil Nil NilWhole Time Director

Mr Ram Shanker Agarwal Non Executive Independent Nil Nil NilDirector

Ms Divya Agarwal2 Non Executive Independent Nil Nil NilDirector

Mr Chandra Prakash Agarwal3 Non Executive Independent Nil Nil NilDirector

Mr Ram Prakash Gupta Non Executive Independent Nil Nil NilDirector

Mr Keshav Behari Lall4 Non Executive Independent Nil Nil NilDirector

1 Only included Indian Companies2 Resigned from directorship w.e.f. 24th August, 2010.3 Resigned from directorship w.e.f. 6th October, 2010.4Mr Keshav Behari Lall has been appointed as additional director w.e.f. 6th October, 2010.

Directors’ Attendance RecordDuring the Financial Year 2010-11, (32) thirty two meetings of the Board of Directors were held on 05.04.2010,04.05.2010, 05.05.2010, 13.05.2010, 14.05.2010, 25.05.2010, 29.05.2010, 31.05.2010, 10.06.2010, 03.07.2010,05.07.2010, 14.07.2010, 21.07.2010, 24.07.2010, 12.08.2010, 20.08.2010, 24.08.2010, 26.08.2010, 04.09.2010,10.09.2010, 20.09.2010, 27.09.2010, 06.10.2010, 12.11.2010, 23.11.2010, 01.12.2010, 22.12.2010, 25.01.2011,12.02.2011, 22.02.2011, 03.03.2011 and 23.03.2011. The Board was duly supplied with the agenda of themeetings incorporating all material information for facilitating meaningful and focused discussions at the meeting.

13

Tirupati Inks LimitedThe intervening period between the Board Meetings was well within the maximum time gap of four months asprescribed in clause 49 of the Listing Agreement. Details of attendance of Directors in the Board meetingduring the financial year 2010-11 are as under:

Name of the Director No. of Board Attendance at Whether attendedMeeting the Board Meeting Last AGM

Mr Sanjiv Agarwal 32 32 Yes

Ms Rajni Maheshwari 32 32 Yes

Mr Rakesh Kumar Agarwal 32 32 Yes

Mr Ram Shanker Agarwal 32 NIL Yes

Ms Divya Agarwal1 32 1 No

Mr Chandra Prakash Agarwal2 23 1 No

Mr Ram Prakash Gupta 32 NIL No

Mr Keshav Behari Lall3 9 NIL No1Resigned from directorship w.e.f. 24th August, 20102 Resigned from directorship w.e.f. 6th October, 2010.3Mr Keshav Behari Lall has been appointed as an Additional Director w.e.f. 6th October, 2010.

Disclosure Regarding Appointment & Re-appointment of Directors in the ensuing AGMMr Ram Shanker Agarwal and Mr Ram Prakash Gupta Directors, who shall be retiring in this AGM, being eligiblehave offered themselves for re-appointment. Mr Keshav Behari Lall was appointed as an Additional Director ofthe company and is proposed to be appointed as Ordinary Director of the Company in the AGM. Brief particularsof these directors are as follows:

Particulars Mr Ram Shanker Agarwal Mr Ram Prakash Gupta Mr Keshav Behari LallDIN 02238676 03201059 03201225Father’s Name Mr. Kashi Nath Agarwal Mr. Ram Karan Gupta Mr. Anand Behari LallDate of Birth 02/02/1947 05/07/1958 03/08/1937Address 397, Shivpuri, West 309 E, Sujat Ganj Kanpur H-52, Deevan Kunj, Shyam

Chapera Pulia, Near Bright Nagar, Uttar Pradesh Nagar, KanpurAngel School Kanpur

Designation Director Director DirectorEducation B.Com, FCA Master of Science Bachelor of Science

[Agriculture]Experience 40 years of experience 14 years of managing 39 years of experience in the

in Accounts, Finance banking affairs. field of chemical engineering& Taxation

Companies in NIL NIL NILwhich holdsDirectorshipCompanies in NIL NIL NILwhich holdsmembership ofcommitteesShareholding in NIL NIL NILthe Company(No. & %)Relationship NIL NIL NILwith otherDirector


14

Particulars Mr Sanjiv Agarwal Mrs Rajni Maheshwari Mr Rakesh Kumar AgarwalDIN 00140174 01371043 00191491Father’s Name Mr S.N.Agarwal Mr Girdhar Das Bhattar Late Shri D.N AgarwalDate of Birth 01.03.1964 07.01.1970 16.12.1960Address B-71, Shyam Nagar 7/103-ASwaroop Nagar, 74 EWS Ganga Vihar, Jajmau

Kanpur-208 013, UP Kanpur 208 002, UP Kanpur 208 010, UPDesignation Whole Time Director Whole Time Director Managing DirectorEducation B.Com, FCA B.A. UndergraduateExperience Over 10 years in the 5 years experience in Over 10 years in the Printing

Ink Industry Administrative and various Ink IndustryFinancial Functions

Companies in Ramdeo Polyster Pvt Ltd Ramdeo Polyster Pvt Ltd NILwhich holdsDirectorshipCompanies in NIL NIL NILwhich holdsmembership ofcommitteesShareholding 2657117 933775 277790in the Company 17.53% 6.16% 1.83%(No. & %)Relationship No relation with any No relation with any No relation with anywith other Director Director DirectorDirector

3. AUDIT COMMITTEE(a) Terms of Reference

The Audit Committee has been constituted as per Section 292A of the Companies Act, 1956 and the provisionsof the Clause 49 of the Listing Agreement. The Audit Committee was last re-constituted on 24th August,2010. The Audit Committee shall have the authority to investigate into any matter that may be prescribedand the matters listed below and for this purpose the Audit Committee shall have full access to informationcontained in the records of the Company and external professional advice, if necessary:

a. To review financial reporting process, all financial statements.

b. To recommend appointment/ re-appointment/ replacement/ removal/ Audit fees/ any other fees of StatutoryAuditor.

c. Reviewing along with management, the listing compliances, related party disclosures, qualifications indraft audit report, matters required to be included in Directors Responsibility Statement, quarterly financialstatements before its submission to the Board, changes in accounting policies, major accounting entriesbased on estimate of management.

d. To look into all matters relating to internal control system, internal audit system and the reasons forsubstantial defaults in the payment to the depositors.

e. To review functioning of “Whistle Blower Mechanism”, if any.

f. To review Management Discussion and Analysis of financial condition and results of operation, statementof significant Related Party Transactions as submitted by management, internal audit report, term ofchief internal auditor (including his remuneration).

(b) CompositionThe committee comprises of one Executive and two non executive independent directors i.e. Mr Ram ShankerAgarwal– as Chairman; Mr Sanjiv Agarwal and Mr Ram Prakash Gupta as the Members of the Committee.

15

Tirupati Inks Limited(c) Attendance

The Committee met five (5) times during the Financial Year 2010-2011 on the following dates: 29.05.2010,12.08.2010, 12.11.2010, 12.02.2011 and 23.03.2011. Details of attendance of Directors in the Audit Committeemeeting are as under:

Name of the Director Designation Category Attendance at the AuditCommittee Meeting

Mr Ram Shanker Agarwal Chairman Non Executive 5Independent Director

Mr Sanjiv Agarwal Member Promoter & 5Executive Director

Ms Divya Agarwal1 Member Non Executive 2Independent Director

Mr Ram Prakash Gupta2 Member Non Executive 3Independent Director

1. Resign w.e.f 24th August, 20102Appointed as Director w.e.f. 24th August, 2010

4 REMUNERATION COMMITTEE(a) Composition & Terms of Reference

The Remuneration Committee shall have the power to determine the Company’s policy on specificremuneration packages including pension rights and other compensation for executive directors and for thispurpose, the Remuneration Committee shall have full access to information contained in the records of theCompany and external professional advice, if necessary.The Committee was last re-constituted on 6th October,2010. The committee comprises of three non executiveindependent directors i.e. Mr Ram Shanker Agarwal– as Chairman; Mr Keshav Behari Lall and Mr RamPrakash Gupta as the Members of the Committee.

(b) Remuneration Policy of the CompanyThe remuneration policy of the Company is directed towards rewarding performance. The Managing Directorand the Whole Time Director of the Company are entitled for payment of Remuneration as decided by theBoard and approved by the members as per the provisions of the Companies Act, 1956. Directors are alsoentitled for the sitting fee for attending Board/ Committee Meeting except the Managing Director and WholeTime Director.

(c) Details of the Directors’ Remuneration for the financial year ended 31st March, 2011Name of Director Sitting Salaries & Commision, Total No. of Shares

Fees Perqusities Bonus Amount held & %(In Rs.) Exgratia (In Rs.)

Mr Sanjiv Agarwal Nil 6,00,000 Nil 6,00,000 2657117 (17.53%)Mr Rakesh Kumar Agarwal Nil 3,12,000 Nil 3,12,000 277790 (1.83%)Mrs Rajni Maheshwari Nil 3,00,000 Nil 3,00,000 933775 (6.16%)Ms Divya Agarwal1 4000 Nil Nil 4000 NilMr Ram Prakash Gupta2 4000 Nil Nil 4000 NilMr Chander Prakash Agarwal3 Nil Nil Nil Nil NilMr Ram Shanker Agarwal 8000 Nil Nil 8000 NilMr Keshav Behari Lall4 Nil Nil Nil Nil Nil

1Resigned on 24.08.2010 2Appointed as Director w.e.f. 24th August, 2010 3Resigned on 06.10.2010Appointed as Director w.e.f. 06.10.2010The directors have waived the sitting fees for the Audit committee meeting held on 23.03.2011 for the purpose of discussion on FireIncident at the Kanpur Unit of the company.


16

5. INVESTORS’ GRIEVANCE COMMITTEE(a) Composition & Terms of Reference: The Company has constituted an “Investors’ Grievance Committee” to

look into redressal of Shareholder’s / investors’ complaints, to approve share transfer, share transmission,splitting, consolidation, Rematerialization requisitions etc. and to oversee all matters connected with theShareholders.The Committee was last re-constituted on 24th August, 2010. The committee comprises of one executiveand two non executive independent directors i.e. Mr Ram Shanker Agarwal– as Chairman; Mr Sanjiv Agarwaland Mr Ram Prakash Gupta as the Members of the Committee.

Name of the Director Category DesignationMr Ram Shanker Agarwal Non-executive Independent ChairmanMr Sanjiv Agarwal Promoter Executive Director MemberMr Ram Prakash Gupta Non Executive Independent Director MemberMs Divya Agarwal1 Non Executive Independent Director Member

1Resigned on 24.08.2010

The committee met Four (4) times during the year on 29.05.2010, 12.08.2010, 12.11.2010 and 12.02.2011.

(b) Ms. Garima Vishnoi is the Compliance Officer of the Company for the purpose of Clause 47 of the ListingAgreements to look after the compliances under the Listing Agreement and other SEBI Rules & Regulationsetc.

(c) During the year, the Company received 18 complaints from its shareholders. All of them were resolved to thesatisfaction of the shareholders and investors. However, a complaint was received in the last week of March,2011 which was pending till 31.03.2011. But the same, was subsequently resolved during the first week ofApril, 2011.

6. GENERAL BODY MEETINGSA). Annual General Meetings: Particulars of past three Annual General Meetings of the Company:

Year Date Venue Time No. of SpecialResolution(s)

passed2008 30.09.2008 1st Floor, Quami Ekta Trust Building, 31, 5:00 P.M. Nil

Bhai Veer Singh Marg, Near Gol Market,New Delhi -110 001

2009 29.09.2009 Lok Kala Manch, Gaytri Hall, 20, 10.30 A.M. TwoLodhi Institutional Area, Lodi Road,

New Delhi2010 25.09.2010 B-4, Unesco Apartments, 11:00 A.M. Nil

Plot No. 55, IP Extension Patparganj,Delhi-110092

Special Resolution passed during the last three Annual General Meeting.

Year Date Business passed2008 30.09.2008 Nil2009 29.09.2009 • Further issue of shares u/s 81(1A)

• Alteration of Articles of Association2010 25.09.2010 Nil

7. DISCLOSURES(a) Related Party Transactions

There are no materially significant related party transactions with its Promoters, the Directors or theManagement, their Subsidiaries or Relatives etc., which may have potential conflict with the interest of thecompany at large. The other related party transactions are given in point no. 13 of Notes on Accountsannexed to and forming the part of Balance Sheet and Profit and Loss Account of the Company.

17

Tirupati Inks Limited(b) Non compliance by the Company, Penalties, Structures

There cwhere were no instances of non-compliance by the Company, penalties, structures imposed on theCompany by the Stock Exchange or SEBI or any statutory authority on any matter related to capital marketsduring the last three years.

(c) Non mandatory requirementsThe Company proposes to adopt the non-mandatory requirements including adoption of Whistle BlowerPolicy given in Annexure-3 of Clause 49 of the listing agreement in due course of time.

8. CODE OF CONDUCTThe Board has formulated a code of conduct for the Board members and senior management of the Company.The same has also been posted on the website of the Company. All Board members and senior managementpersonnel have affirmed their compliance with the code.Declaration on compliance with code of conduct by the Chairman & Managing Director:The Board has formulated a code of conduct for the Board members and senior management of the Company,which has been posted on the website of the Company – www.tirupatiinks.com.It is hereby affirmed that all the Directors and senior management personnel have complied with the code ofconduct framed by the Company and a confirmation to that effect has been obtained from the directors andsenior management.

Sanjiv Agarwal Rakesh Kumar AgarwalExecutive Chairman Managing Director

9. MEANS OF COMMUNICATION(a) At present quarterly/ half-yearly reports are not being sent to shareholder, individually.

(b) The Quarterly / Half-Yearly / Annual Accounts results are published in the English and Hindi Newspapers.

— which newspaper normally published in Financial Express Mumbai Edition(English)

Financial Express Delhi Edition(English) & Jansatta (Hindi)

— Any website where displayed Yes — www.tirupatiinks.com

(c) The Management Discussion and Analysis forms a part of the Annual Report.

10. GENERAL SHAREHOLDERS INFORMATIONi) Annual General Meeting

Day & Date Time Venue

Tuesday, September 27th, 2011 11.00 A.M. Lok Kala Manch, 20, LodhiInstitutional Area, Lodhi Road, New Delhi

ii) Financial CalendarEvents Tentative time frameFinancial Reporting for the first quarter ended 12th August, 2011 (actual)30th June, 2011

Financial Reporting for the second quarter ending On or before 14th November 201130th September, 2011

Financial Reporting for the third quarter ending On or before 14th February 201231st December, 2011

Financial Reporting for the fourth quarter ending On or before 15th May 201231st March, 2012

iii) Dates of Book Closure : Monday, 26th September, 2011to Tuesday, 27th September, 2011

iv) Dividend Payment Date Not applicable


18

v) Listing on Stock Exchanges: The Shares of the Company are listed on the Delhi Stock ExchangeLimited and Bombay Stock Exchange Limited.

vi) Stock Code/ Symbol: 19053 at the Delhi Stock Exchange 533258 Bombay Stock Exchange Limited.

vii) Market Price Data : The Company was earlier listed only in Delhi Stock Exchange (DSE) where notrading took place till 30th September, 2010. So, stock market data pertaining to monthly high and lowprice of the Equity shares of the company during the first half of the financial year are not available.However, after the Further Public Offer, the shares were listed and traded at Bombay Stock Exchange(BSE) w.e.f.1st October, 2010. Hence, the High/ low of market price of the Company’s equity sharestraded on BSE during the second half of the financial year were as follows:

Year High Low VolumeOct-2010 61.45 17.50 4,05,31,88,089

Nov-2010 22.85 13.05 11,07,58,187

Dec-2010 16.85 10.90 3,26,68,856

Jan-2011 17.48 12.05 3,96,42,124

Feb-2011 13.10 9.80 1,04,04,438

March-2011 11.77 8.50 1,23,02,487

Source : www.bseindsia.com

viii)Registrar and Share Transfer Agent & Share Transfer, SystemIn compliance with the Listing Guidelines, the Share Transfer System of the Company is regularly audited.M/s Beetal Financial & Computer Services (P) Ltd, its Registrar and Share Transfer Agent carries out theprocess of share transfer in physical as well as in demat form.

Particulars Beetal Financial & Computer Services (P) LtdContact Person Mr Puneet MittalAddress Beetal House, 3rd Floor, 99, Madangir, Behind Local Shopping Centre,

Near Dada Harsukhdas Mandir,New Delhi- 110 062Telephone No. 011-29961281, 282 , 283Fax No. 011-29961284E-mail [email protected]

ix) Distribution of Shareholding as on 31st March 2011:

Shareholding of Nominal Shareholders Share AmountValue of

Rs. Rs. Number % to Total In Rs. % to Total(1) (2) (3) (4) (5)

Up to 5,000 8098 74.46 1,61,38,060 10.65055,001 10,000 1304 11.99 1,10,81,100 7.3131

10,001 20,000 700 6.44 1,12,53,150 7.426720,001 30,000 226 2.08 59,25,890 3.910930,001 40,000 130 1.20 47,24,270 3.117840,001 50,000 125 1.15 60,40,060 3.986250,001 1,00,000 153 1.41 1,15,19,390 7.60241,00,001 and Above 140 1.26 8,48,41,780 55.9924Total 10876 100 15,15,23,700 100

19

Tirupati Inks Limitedx) Dematerialization of shares and liquidity: As on 31st March 2011 about 97.05% of the Company’s equity

paid- up capital had been dematerialized. Trading in equity shares of the Company at the Stock Exchange ispermitted compulsorily in demat mode.

xi) There are no outstanding GDRs/ ADRs/ Warrants or any Convertible other Instruments as on the date.

xii) Plant Locations: At the beginning of the financial year 2010-11, the company had its printing ink plant attwo units, each at Kanpur and Jammu. However, a major fire erupted at the factory premises of the Kanpurunit of the company, during the closing days of March, 2011, which caused severe damage to the Land andBuilding including Stock and Plant and Machinery at the manufacturing unit at Kanpur.

The company is setting up a new manufacturing facility at Greater Noida for the purpose of manufacturing ofspecialty inks.

UnitsKanpur UnitA-1/33 & A-1/29, Dada Nagar Industrial Area, Kanpur - 208 022 (U.P.)(Closed due to fire mishap)Jammu UnitLane No.4, Phase-II, Plot No.267, SIDCO Industrial Complex,Bari Brahmana, Jammu – 181133 (J & K)Greater Noida UnitPlot no. D-109 to D-112, Industrial Area, Surajpur - Site 5,EPIP, Kasna, Greater Noida. (Under Implementation)

xiii)Address for Correspondence: The shareholders may send their communication grievances/ queries to theRegistrar and Share Transfer Agents at their Address mentioned above or to the Company at:

Investor Relation CentreTirupati Inks Ltd

101, DDA Market, Hargobind EnclaveVikas Marg Extn.

New Delhi – 110 092Telefax: +91-11-22376767

e-mail:[email protected]


20

CEO/CFO CertificationWe, Rakesh Kumar Agarwal, Managing Director and Rajiv Kapoor, Chief Financial Officer (CFO), responsible for thefinance function certifies that:(a) We have reviewed financial statements and the cash flow statement for the year ended 31st March 2011 and that

to the best of our knowledge and belief:(i) these statements do not contain any materially untrue statement or omit any material fact or contain statements

that might be misleading;(ii) these statements together present a true and fair view of the company’s affairs and are in compliance with

existing accounting standards, applicable laws and regulations.(b) To the best of our knowledge and belief, no transactions entered into by the company during the year which are

fraudulent, illegal or violative of the company’s code of conduct.(c) We accept responsibility for establishing and maintaining internal controls for financial reporting and that they

have evaluated the effectiveness of internal control systems of the company pertaining to financial reporting andthey have disclosed to the auditors and the Audit Committee, deficiencies in the design or operation of suchinternal controls, if any, of which they are aware and the steps they have taken or propose to take to rectify thesedeficiencies.

(d) We have indicated to the auditors and the Audit committee(i) significant changes in internal control over financial reporting during the year;(ii) significant changes in accounting policies during the year and that the same have been disclosed in the

notes to the financial statements; and(iii) instances of significant fraud of which they have become aware and the involvement therein, if any, of the

management or an employee having a significant role in the company’s internal control system over financialreporting.

Date : 23rd August, 2011 Rajiv Kapoor Rakesh Kumar AgarwalPlace : Delhi Chief Financial Officer Managing Director

Certificate of Compliance with the conditions ofCorporate Governance under Clause 49 of the Listing Agreement

ToThe MembersTirupati Inks LimitedNew Delhi

We have examined the compliance of conditions of Corporate Governance by Tirupati Inks Limited (hereinafterreferred as “the Company”) for the year ended March 31, 2011, as stipulated in clause 49 of the listing agreement ofthe said Company with the stock exchanges.

The compliance of conditions of Corporate Governance is the responsibility of the Management. Our examinationwas limited to procedures and implementation thereof, adopted by the Company for ensuring the compliance of theconditions of Corporate Governance. It is neither an audit nor an expression of opinion on the financial statementsof the Company.

In our opinion and to the best of our information and explanations given to us, we certify that the Company hascomplied with the conditions of Corporate Governance as stipulated in the above-mentioned listing agreement.

We state that no investor’s grievance is pending for a period exceeding one month against the Company, as per therecords maintained by the Shareholders/ Investors’ Grievance Committee.

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

For R&DCompany Secretaries

Date : 23rd August, 2011 Debabrata Deb NathPlace : Delhi ACS: 23935; CP: 8612

21

Tirupati Inks LimitedMANAGEMENT DISCUSSION AND ANALAYSIS REPORT

Cautionary StatementStatements in the Management Discussion and Analysis describing the Company’s objectives, expectations orpredictions may be forward looking within the meaning of applicable securities, laws and regulations. Actual resultsmay differ materially from those expressed in the statement. Important factors that could influence the Company’soperations include overall global economic conditions, domestic manufacturing and service sector growth, foreignexchange stability, stable credit environment, Government policies, economic development, political factors andsuch other factors beyond the control of the Company.Forward-Looking StatementsForward-looking statements are based on certain assumptions and expectations of future events. The Companycannot guarantee that these assumptions and expectations are accurate or will be realized. The Company’s actualresults, performance or achievements could thus differ materially from those projected in any such forward-lookingstatements. The Company assumes no responsibility to publicly amend, modify or revise any forward lookingstatements, on the basis of any subsequent developments, information or events.Overview, Industry Structure & DevelopmentsOur Company is mainly engaged in the business of manufacturing of printing ink and trading in polyester films andother packaging materials. We emphasize on providing complete packaging solutions to our consumers and societyat large. The fortunes of the printing ink industry are linked to the economy, particularly the publishing and packagingsectors. This will directly benefit our company. The focus of the government on higher literacy level would furtheraccelerate the demand of the publishing sector.

Packaging Raw Materials - Inks & AdhesivesThe printing ink industry is committed to contribute its share to the food packaging supply chain aimed at enhancingconsumer safety. It is a responsible industry with sustainable products The printing ink industry is fully aware of itsresponsibilities and recognizes the need for reducing the impact on the environment. The industry discharges itsresponsibilities in many ways. For example, it has a proven track record of using considerable amount of renewableraw materials. The industry has established an exclusion list for raw materials. Energy resources are used efficientlyin the manufacturing of inks.Printing ink is coloring material in the form of a fluid or paste which is used for printing on a substrate and then dried.Depending on the process and end use, inks are classified into letterbrss, lithographic, flexographic, rotogravure andothers. Although most of the raw materials used in ink manufacture are available in India, but certain specialty itemsare imported. The growth of the printing ink sector has been very rapid. The market leaders in printing ink manufactureare USA, Europe and Japan. The demand for printing inks is expected to show an annual growth of more than 2-3%in Western Europe, North America and Japan. The world market trend points towards eco-friendly inks. Majorityof the countries are concentrating on water based and UV-cured inks. The growth rate for Lamination Adhesive interms of volume is approximately 15% per annum.The Global printing ink market of USD 14.5 billion is split evenly between North America, Europe and Asia-Pacific.While the North American and European sales have flattened out, the Asia-Pacific region continues to grow at a fastpace of about 8%, and should soon become the largest region in terms of ink consumption, driven by economicgrowth in China, India and other key countries.Printing Ink market domestically continued to grow at about 12%, a market of about Rs. 17 billion saw augmenting itsturnover on the back of stable growth and the overall Indian economic stability in its user industries such as FMCG,media, flexible packaging and publishing. Printing Ink industry has witnessed an encouraging growth in domesticmarket during the year under review, but having pressure on the margins in view of the increase in input costs andrising other costs. The growth of the printing ink sector including that of rotogravure and flexographic inks has beenvery fast. Many new and innovative products are being introduced on a regular basis to meet the specific requirementsof customers and other factors such as environmental concerns.For increased qualitative and quantitative production, absorption of imported technology and its up gradation isessential. Manufacturers follow standard tests and procedures for proper quality inks. The use of eco-friendly inksreduces and controls pollution to a great extent. Research efforts in India, on this aspect, have just been initiated.Printing inks are formulated from three basic components: a colorant, a vehicle system to carry the colorant, andadditives such as waxes and driers. Colorants may be dyes, but are typically pigment-based. They may be in powderform (dry toner), in a concentrated paste dispersion known as a flush, or in a liquid dispersion. Additives can includewaxes, driers and other materials that add specific characteristics to an ink or the dried ink film.Adhesives have a variety of applications in the packaging industry for a broad range of materials. The growth rate forLamination Adhesive in terms of volume is approximately 15% per annum. Different applications require different


22

adhesive systems. Globally, solvent less adhesives are the fastest growing adhesive technology in film laminating.The application process involves metering a curable adhesive onto a multiple application roll configuration thatapplies the adhesive to primary substrate, which is then mated to a secondary substrate via a heated nip.With increase in demand of flexible packaging material, due to shift in customer preference and opening up oforganized retail, the demand for flexographic inks is increasing. Further, the Company has indigenously producedthe new generation cost effective polyether base solvent less adhesive system for flexipack, new ink system for PVCprofile and special coating for producing matt effect in laminates. These products are now well established in themarket against competitions.

Flexible PackagingThe fiscal year 2009-10 was a challenging year for the Indian economy. India witnessed a significant revival ineconomic activity following the moderation in fiscal 2009. The economic recovery was evident across a wide rangeof sectors with the momentum gaining strength in the second half of fiscal 2010. The growth in Gross DomesticProduct (GDP) during the first half of fiscal 2010 was 7.0% compared to 6.0% during the second half of fiscal 2009.However, during the third quarter of fiscal 2010, GDP growth moderated to 6.0% mainly due to decline in agriculturaloutput following below normal monsoons and moderation in services sector growth to 6.6%. Reflecting the overallimprovement in the economy, the Central Statistical Organization (CSO) has placed advance estimates of GDPgrowth for fiscal 2010 at 7.2%.Flexible packaging industry is the fastest growing segment of the packaging industry worldwide and growing about5.5% to 6% annually. Asia is growing faster than North America and Western Europe and will emerge as the world’slargest regional flexible packaging market by 2013. The area will account for more than one-third of total demand.Over the last five years, all regions except Western Europe experienced growth ranging from around 4% per annumin North America to 9% in South-East Asia and Oceania as well as in Eastern Europe. China and India were themost dynamic markets, growing in value terms by around 12% and 17% respectively.At a compound annual growth rate of 17 percent, the flexible packaging market is one of the most dynamic andfastest growing in the Country. As the advantage of flexible packaging of lesser storage space, easy handling, costeffectiveness with better aesthetic factors becomes increasingly appreciable, traditional rigid packaging will take abackseat. Flexible packaging scores better over traditional packaging for such reasons.Flexible packaging also offers the advantage of packing smaller quantities compared to traditional packaging andhence, middle class consumers, who comprise of a major section of the Indian society, have the choice of purchasingjust the required products.The flexible packaging market has excellent growth potential in the food and processed food, personal care, FMCGand retail sector. The demand for smaller packaging and increasing consumerism due to higher purchasing powerhas been a boon for the flexible packaging market. Packaging consumer products safely, conveniently, attractivelyand in eco-friendly packaging improves brand value which in turn increases market share. In the aggregate, packagingas sectorial activity boosts consumption and economic growth. ‘With the introduction of innovative and new products, Indian Flexible Packaging Industry will lead to faster growth ata rate of around 25% annually. With the advent of newer plastic films and new technologies, the industry will belooking at better quality of the products and thereby, increased sales volumes. In fact, the market is expected tomultiply its output three times in the next few years owing to the greater demand from the food and processed foodand retail segments.With the expanding middle class and rising income levels, the patterns of consumption are bound to changesubstantially and the demand for quality and convenience-based products will increase. Concurrently, the increasedinteraction with the developed world will considerably influence the aesthetic and quality norms of the Indian consumerand lead to better consumption standards. This is expected to stimulate greater consumption of branded productsand thus increase the use of flexible packaging. Flexible packaging contains multi-layered laminated sheets of singleor a combination of substrates such as plastic, paper and aluminium. Flexible packaging finds preferred use becauseof its ability to provide strength, moisture resistance, aroma retention, gloss, grease resistance, heat retention,printability and low odour. Flexible packaging has gained vast acceptability because of the protection it offers to theproduct against environmental threats like moisture, heat, and chemical reaction. Convenience in handling the productand the cost benefits are added advantages.Our ApproachFor our processes, we will:

• Set improvement targets for energy and water consumption, greenhouse gas emissions, and solid wasteemissions.

• Measure and report these parameters, regularly, by site and by product.• Establish actions to improve, then re-check and re-measure.

23

Tirupati Inks LimitedFor our products, we have:

• A structured and robust approach to product development that includes risk management and eco-efficiencyimprovements as key criteria.

• Proactive approach in working with suppliers, customers, and industry trade groups to promote best practices.

Business ReviewFlexible Packaging BusinessThe main products of this business are laminates made with various combinations of Polyester, BOPP, poly, metalized& hologram films and others and supplied in roll form and in various pouches, manufacture of rotogravure cylindersfor various types of rotogravure printing, Anilox/Coating, Rollers for flexo printing and Shims for holographic embossingand holograms and printing ink and adhesives and packaging & processing machines. This business involvescustomization according to the needs of customer. The company provides complete solutions to the packagingneeds of customersThe Company has successfully developed several new packaging solutions for various applications suitable forFood Industry, the Bakery and Confectionery Industry, Beverage Industry and the Personal Care Products Industry.The Company’s strategy for product innovation together with cost leadership and enhancing quality with betterservice has led to significant growth in salesThe value added flexible packaging business of the Company has been progressively gaining larger share in thetotal revenue of the Company and growing at a faster pace both in the domestic and international market.

OpportunitiesThe packaging industry is very dynamic and has undergone significant change because the environment in which itoperates is changing e.g. laws & regulations, introduction of new products, the globalization of technologies and ageneral increase in competitiveness have accelerated in the last 10 years, but there are greater concerns with healthand reliability issues such as greater commercial pressure for freshness in foods. In the drug sector, there is alsopressure to inform the consumer greater details about the drug, its effects and side effects. Above all, the worldperceives the packaging industry an environmental unfriendly and thus there is opposition to it in general. But all theproducts made by the Company are eco-friendly, thus do not have any effect.

Future OutlookThe printing industry growth is linked to the GDP growth of the country. The demand for the printing ink has becomethe vital aspect in sustaining the market growth. The industry depends heavily on the prices of raw materials, crudeoil. Moreover, the price volatility of these commodities has prompted the companies to opt for counter measures. Thedemand for printing ink is expected to grow further, especially from publishing segment and packaging segment. Theindustry will be on a zooming track of growth within a short span of time.Flexible packaging has been one of the fastest growing sectors of the packaging market over the last decade havingdeveloped from simple wraps and bags to more complex products with sophisticated functionality. The flexiblepackaging has promising future both in India & globally due to increased consumerism, Asia taking a leading positionin the world.

Corporate Social ResponsibilityThe Company is a socially responsible corporate citizen committed to deliver a positive impact across social, economicand environmental parameters. The Company acknowledges its responsibility on the manner that its activities influenceits consumers, employees and stake holders, as well as the environment. The Company seeks to achieve its corporateand social objectives by focusing on the following strategic areas-• Environmental Responsibility• Employee Engagement• Community Initiatives

Risk ManagementOver the years, the Company has achieved an appropriate balance between risk and returns by setting up anefficient risk mitigation system to meet various forms of financial and other risks. The primary risks that the companyis exposed to credit risk, market risk and operational risk. Evaluation of risk and its management becomes moreimportant in the global scenario, especially when your Company is trying to penetrate the global markets.Low demand, economic slowdown, political instability, higher inflation, natural calamities may affect the business.Business therefore cannot be risk free. What is therefore important is to correctly access the risk area wise and totake steps to mitigate the risk before it becomes a potential threat. General risk areas are statutory compliances,economy, financial, government regulations and policies, market related, operational, products and technology,intellectual property etc.


24

Human Resource Development/Industrial RelationsThe Company’s Human Resources philosophy is to establish and build a strong performance and competencydriven culture with greater sense of accountability and responsibility. The Company has taken pragmatic steps forstrengthening organizational competency through involvement and development of employees as well as installingeffective systems for improving the productivity, quality and accountability at functional levels.Our people are our key asset. We have been able to create a work environment that encourages pro-activeness andresponsibility. The Company has cordial relations with employees and staff. There were no industrial relations problemsduring the year and the Company does not anticipate any material problems on this count in the current year. Themanagement is also committed to help the employees and workers to sharpen their skills and to improve theirknowledge base for which continuous efforts are made on training and development.With the changing and turbulent business scenario, our basic focus is to upgrade the skill and knowledge level of theexisting human assets to the required level by providing appropriate leadership at all levels, motivating them to facethe hard facts of business, inculcating the attitude for speed of action and taking responsibilities. The Companyrecognizes the importance and contribution of its human resources for its growth and development and is committedto the development of its people.

Internal Control Systems and AdequacyThe Company has established internal control systems for ensuring optimum use of resources and safeguarding theassets. The Internal Control Systems and procedure are adequate and commensurate with the size of the Company.These business control procedures ensure efficient use and protection of the resources and compliance with thepolicies, procedures and status. The management has put in place internal system for constant review and monitoringof recovery efforts.The Company has already formed an Audit Committee and has met five times in the year. Audit Committee ensuresproper compliance with the provisions of the Listing Agreement with Stock Exchanges, Companies Act, reviews theadequacy and effectiveness of the internal control environment and monitors implementation of. Internal auditrecommendations. Besides the above, Audit Committee is actively engaged in overseeing financial disclosures andin reviewing your Company’s risk management policies.The role and responsibility of all managerial positions are established, monitored and controlled regularly. All thetransactions are authorized, timely recorded and reported truly and fairly. However, as part of an ongoing process,we have further strengthened it by making a few more processes and workflows IT system based to ensure tightercontrol, monitoring and increased accountability in various areas of operation. In order to ensure adherence to thelaid- down systems, apart from internal reporting and monitoring, we have also put in place formal Internal AuditSystem commensurate with the size and nature of business. We will continue our focus on improving the systemsand procedures further to improve efficiency, transparency and accuracy.

Environment, Occupational Health & SafetyYour Company is committed to conducting its operations with due regard to the environment and providing a safeand healthy workplace for employees. The collective endeavour of your Company’s employees at all levels is directedtowards sustaining and continuously improving standards of environment, occupational health and safety in a bid toattain and exceed international benchmarks.

Segment PerformancePresently the Company’s primary business segment is Printing Inks & Polyester Films. Details of Business Segmentsto the extent available are as follows:

Particulars Year Ended 31st March, 2011Printing Inks Polyester Films Total

Segment Revenue 3819.10 5981.42 9800.52Segment Results 482.68 309.10 791.78Less: Unallocated Expenses - - 151.71Add: Interest & Other Income - - 24.61Less: Financial Expenses - - 329.94Profit Before Tax - - 334.74Less: Provision for Tax - - 81.51Profit After Tax - - 253.23

25

Tirupati Inks LimitedAUDITOR’S REPORT

To,The MembersM/s Tirupati Inks Limited.101, DDA Market, Hargobind Enclave,Vikas Marg Extn.,Delhi - 110092

We have audited the attached Balance Sheet of Tirupati Inks Limited (“the Company”) as at March 31, 2011, therelated Profit & Loss Account and Cash Flow Statement for the year ended on that date annexed thereto, which wehave signed under reference to this report. These financial statements are the responsibility of the Management ofthe Company. Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with the auditing standards generally accepted in India. Those Standardsrequire that we plan and perform the audit to obtain reasonable assurance about whether the financial statementsare free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amountsand disclosures in the financial statements. An audit also includes assessing the accounting principles used andsignificant estimates made by the Management, as well as evaluating the overall financial statement presentation.Subject to limitation of our scope of substantial verification of accounting records due to damage in fire as mentionedin para 1 & 2 of notes to accounts we believe that our audit provides a reasonable basis for our opinion.

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

Further to our comments in the Annexure referred to in Paragraph 3 above, we report that :

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

(b) In our opinion, proper books of account as required by law have been kept by the Company so far as appearsfrom our examination of those books subject to Note No. 1 & 2 of the Notes to accounts;

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

(d) In our opinion, the Balance Sheet, Profit and Loss Account and the Cash Flow Statement dealt with by thisreport comply with the accounting standards referred to in sub-section (3C) of Section 211 of the Act;

(e) On the basis of the written representations received from the Directors as on March 31, 2011, and taken onrecord by the Board of Directors of the Company, none of the Directors is disqualified as on March 31, 2011 frombeing appointed as a Director in terms of clause (g) of sub-section (1) of Section 274 of the Act;

(f) In our opinion and to the best of our information and according to the explanation given to us, the Balance Sheet,Profit and Loss Account and the Cash Flow Statement, together with the Notes thereon and annexed thereto,give in the prescribed manner the information required by the Act and give a true and fair view in conformity withthe accounting principles generally accepted in India :i. in the case of the Balance Sheet, of the state of affairs of the Company as at March 31, 2011;ii. in the case of the Profit and Loss Account, of the profit for the year ended on that date; andiii. in the case of the Cash Flow Statement, of the cash flows for the year ended on that date.

For SHASHI DINESH & CO.Chartered Accountants

Sudhir Kapoor(Partner)

Place : Delhi Membership No. 073456Dated : 15.07.2011 Firm’s Regn No. 004975 C


26

ANNEXURE TO THE AUDITORS REPORT

i (a) The Fixed Assets register of the company was destroyed in the fire at Kanpur factory/Corporate office,hence the same could not be verified by us. The management is in the process of compilation of the same.

(b) As informed to us these fixed assets have been physically verified by the management during the period butthe discrepancies noticed, if any, from the book records and physical inventory of Fixed assets Registercould not be verified by us in view of the said register destroyed in fire. However management has representedthat there were no material discrepancies noticed.

(c) During the year , Fixed Assets belonging to the Kanpur Unit of the company were destroyed in the fire. Sincethe company has another operational unit at Jammu, the going concern concept of the company is notaffected.

ii (a) The inventory has been physically verified during the year by the management. In our opinion, the frequencyof verification is reasonable.

(b) The procedures of physical verification of inventories followed by the management are reasonable andadequate in relation to the size of the company and the nature of its business.

(c) The company is maintaining proper records of inventory. However, in view of the fire at Kanpur Unit whichdestroyed records of Inventory of the Kanpur Unit , comparison of stock records with physical quantitiescould not be done at the year ending. Physical verification was conducted by the management at JammuUnit and another locations and no material discrepancies were noticed.

iii (a) The company has not granted any loans secured or unsecured to the companies, firms or other partiescovered under section 301 of the Act. Accordingly clauses iii(b) to iii (d) of the paragraph 4 of the order arenot applicable to company for the current year.

(b) The company has obtained an unsecured, interest free loan from one of the director of the company. Theamount valued is Rs.40.65 lacs. The terms and conditions are not prima facie prejudicial to the interest ofthe company. In respect of the aforesaid loan no repayment schedule has been fixed by the company andhence there in no overdue amount at the end of the financial year.

iv In our opinion and according to the information and explanations given to us, there are adequate internal controlprocedures commensurate with size of the company and the nature of its business with regard to purchase ofinventory, fixed assets and with regard to the sale of goods and services. During the course of our audit, we havenot observed any continuing failure to correct major weaknesses in internal controls.

v. (a) According to the information and explanations given to us, we are of the opinion that the transaction thatneed to be entered into the register maintained under section 301 of the Companies Act, 1956 have been soentered.

(b) In our opinion and according to the information and explanations given to us, the transaction made in pursuanceof contracts or arrangements entered in the register maintained under section 301 of the Companies Act,1956 in respect of any party, during the year have been made at prices which are reasonable having regardto prevailing market prices at the relevant time.

vi. As per the information and explanations given to us and as per our examination of books of accounts, thecompany has not taken any deposit, hence there is no contravention of the provisions of Section 58A, 58AA orany other relevant provisions of the Companies Act, 1956

vii. In our opinion, the company has an internal audit system commensurate with the size and nature of its business.In view of the increased size and nature of the transactions, it is advisable to strength it more, in the ensuingyear.

viii. The Central Government has not prescribed the maintenance of cost records for the financial year 2010 - 2011in respect of the Company under section 209 ( 1 ) ( d ) of the Companies Act, 1956, as confirmed by themanagement.

ix (a) The company is generally regular in depositing with appropriate authorities undisputed statutory dues includingprovident fund, employees state insurance, income tax, service tax, custom duty, excise duty, cess andother material statutory dues applicable to it.

(b) According to the information and explanations given to us, no undisputed amounts payable in respect ofincome tax, wealth tax, sales tax, service tax, custom duty, excise duty and cess were in arrears, as at 31st

March 2011 for a period of more than six months from the date they became payable.

27

Tirupati Inks Limitedx. The company has no accumulated losses, hence this clause is not applicable .

xi. In our opinion and according to the information and explanations given to us, the company has not defaulted inrepayment of dues to financial institution, bank or debenture holders.

xii. The company has not granted any loans and advances on the basis of security by way of pledge of share,debentures and other securities.

xiii. In our opinion, the company is not a chit fund or a nidhi/mutual benefit fund/society. Therefore, the provisions ofclause 4(xiii) of the companies (Auditors Report) order, 2003 are not applicable to the company.

xiv. In our opinion, the company is not dealing in or trading in shares, securities debentures and otherinvestments.Accordingly,the provisions of clause 4(xiv) of the Companies (Auditor’s Report) order, 2003 arenot applicable to the company.

xv. As per the explanation and as per the records of the company, no guarantee has been given by the companyfor loans taken by the others from banks or financial institutions.

xvi. As per the explanation and as per the records of the company, no term loan has been obtained during the yearexcept vehicle loan.

xvii. According to the information and explanations given to us, and on an overall examination of the balance sheetof the company, we report that no funds raised on short-term basis have been used for long- term investment.No long-term fund have been used to finance short- term assets except permanent working capital.

xviii. During the year the company has allotted 2676744 equity shares @ Rs. 43.00 per equity share ( includingsecurities premium of Rs. 33.00 per equity share ) for Rs. 11.51 Crores on preferential basis (pursuant to theallotment of equity shares under the promoter’s quota on FPO raised in September, 2010 as per SEBI (ICDR)Regulations, 2009) to the parties covered in the register maintained under section 301 of the CompaniesAct,1956.

xix Since the company has not issued debentures this clause is not applicable.

xx. The management has disclosed the end use of money raised through Public Issue of Equity Shares during theyear and we have verified the same on the basis of records produced before us.

xxi. According to the information and explanations given to us, no fraud on or by the company has been noticed orreported during the course of our audit.

For SHASHI DINESH & CO.Chartered Accountants

Sudhir Kapoor(Partner)

Place : Delhi Membership No.073456Dated : 15.07.2011 Firm’s Regn No. 004975 C


28

BALANCE SHEET AS AT 31ST MARCH, 2011(Rs. in Lacs)

As At As AtPARTICULARS Schedule

31.03.2011 31.03.2010

SOURCES OF FUNDSShareholders’ Fund(a) Equity Share Capital 1 1515.24 317.56(b) Reserve & Surplus 2 4435.48 405.57Deferred Tax Liabilities 27.78 30.99Loan Funds(a) Secured Loans 3 1992.18 1595.88(b) Unsecured Loans 4 113.82 415.35

--------------------------------------------------------------------- ---------------------------------------------------------------------TOTAL 8084.50 2765.35

============================================== ==============================================APPLICATION OF FUNDS

FIxed AssetsGross Block 5 478.71 410.20Less : Depreciation Reserve 34.89 77.94

--------------------------------------------------------------------- ---------------------------------------------------------------------Net Block 443.82 332.26Capital Work-in-Progress 1414.36 5.73

--------------------------------------------------------------------- ---------------------------------------------------------------------Net Fixed Assets 1858.18 337.99

============================================== ==============================================Current Assets, Loans & Advances(a) Inventories 6 1936.57 1414.67(b) Sundry Debtors 7 4041.17 1684.74(c) Cash & Bank Balances 8 495.46 144.64(d) Loans & Advances 9 910.30 44.58

--------------------------------------------------------------------- ---------------------------------------------------------------------7383.50 3288.63

============================================== ==============================================Less : Current Liabilities & Provisions(a) Liabilities 10 1054.46 811.75(b) Provisions 11 102.72 88.10

--------------------------------------------------------------------- ---------------------------------------------------------------------1157.18 899.85

--------------------------------------------------------------------- ---------------------------------------------------------------------Net Current Assets 6226.32 2388.78

============================================== ==============================================Miscellaneous Expenditure(To the extent not written off or adjusted )Public Issue Expenses 0.00 38.58

--------------------------------------------------------------------- ---------------------------------------------------------------------TOTAL 8084.50 2765.35

============================================== ==============================================STATEMENT OF SIGNIFICANTACCOUNTING POLICIES 19

NOTES FORMING PART OF ACCOUNTS 20

AUDITOR’S REPORTThis is the Balance Sheet referred to in our separate report of even date annexed.

For SHASHI DINESH & CO. For & on behalf of the board of Tirupati Inks Ltd.Chartered Accountants

Sudhir KapoorPartner Rakesh Kumar Agarwal Rajni Maheshwari Garima VishnoiMembership No. 073456 Managing Director Whole Time Director Company SecretaryFirm’s Regn No. 004975 C

Place : KanpurDate : 15.07.2011

29

Tirupati Inks LimitedMANUFACTURING, TRADING & PROFIT & LOSS ACCOUNT FOR THE YEAR ENDING 31.03.2011

(Rs. in Lacs)

Year Ended Year EndedPARTICULARS Schedule

31.03.2011 31.03.2010

INCOMESales 12 9800.52 7166.81Other Income 13 24.61 9.41Increase/(Decrease) in Stock 14 661.62 346.87

--------------------------------------------------------------------- ---------------------------------------------------------------------TOTAL 10486.75 7523.09

============================================== ==============================================

EXPENDITUREPurchases/Consumption 9480.34 6565.58Manufacturing 15 175.62 174.52Administrative 16 94.31 78.15Selling & Distribution 17 51.34 47.69Financial 18 329.94 340.11Depreciation 20.46 20.81

--------------------------------------------------------------------- ---------------------------------------------------------------------TOTAL 10152.01 7226.86

============================================== ==============================================Profit/(Loss) for the Year 334.74 296.23Less: Provision for Income Tax 75.83 65.58Less: Adjustments Relating to Previous Year 8.36 1.76Less: Interest on Tax 0.65 3.00Add : Excess Provision of I.Tax w/back for AY 10-11 0.12 0.00Less: Provision for Deferred Tax 0.00 10.47Add : Provision for Deferred Tax w/back 3.21 0.00Profit (Loss) After Tax 253.23 215.42Add: Proposed Dividend w/back 0.00 27.76Add: Proposed Dividend Tax w/back 0.00 4.71Net Profit(Loss) After Appropiation 253.23 247.89Add: Balance Brought Forward From Previous Year 341.57 93.68

--------------------------------------------------------------------- ---------------------------------------------------------------------Balance Carried Forward To Balance Sheet 594.80 341.57

============================================== ==============================================Basic Earning Per Share (Rs.) 2.73 7.25Refer Note No. 14 of Notes to Accounts

STATEMENT OF SIGNIFICANTACCOUNTING POLICIES 19

NOTES FORMING PART OF ACCOUNTS 20

AUDITOR’S REPORTThis is the Profit and Loss Account referred to in our separate report of even date annexed.





30

SCHEDULES FORMING PART OF THE BALANCE SHEET(Rs. in Lacs)

As At As AtPARTICULARS

31.03.2011 31.03.2010

SCHEDULE-1 : SHARE CAPITAL

AUTHORISED16000000 (Previous Year 16000000 ) Equity Shares of Rs. 10/- each 1600.00 1600.00

--------------------------------------------------------------------- ---------------------------------------------------------------------

ISSUED, SUBSCRIBED & PAID UP CAPITAL15152370 Equity Shares of Rs. 10.00 each fully paid-up 1515.24 317.56(Previous Year 3175626 Equity Shares of 10/- each) of the above11976744 Equity Shares of Rs. 10.00 each were issued at apremium of Rs. 33.00 per share by way of FPO in Sept. 2010

--------------------------------------------------------------------- ---------------------------------------------------------------------TOTAL 1515.24 317.56

============================================== ==============================================

SCHEDULE-2 : RESERVE & SURPLUSProfit & Loss A/c. 594.80 341.57

Securities Premium at the beginning of the year 64.00

Add:Receipt on Issue of 11976744 Eq. Shares from FPO 3952.33

Less: Share Issue Expenses w/off (Previous Year Nil) 175.65 3840.68 64.00--------------------------------------------------------------------- ---------------------------------------------------------------------

TOTAL 4435.48 405.57============================================== ==============================================

SCHEDULE-3 : SECURED LOANSCash Credits 1947.85 1515.83

Term Loans 37.43 65.74

Other Loans 6.90 14.31--------------------------------------------------------------------- ---------------------------------------------------------------------

TOTAL 1992.18 1595.88============================================== ==============================================

SCHEDULE-4 : UNSECURED LOANS(i) From Directors 40.65 15.65

(ii) Others 73.17 399.70--------------------------------------------------------------------- ---------------------------------------------------------------------

TOTAL 113.82 415.35============================================== ==============================================

31

Tirupati Inks LimitedSC

HEDU

LE -

5FI

XED

ASSE

TS A

NNEX

URE

AS P

ER C

OM

PANI

ES A

CT, 1

956

(Rs.

in L

acs)

GROS

S BL

OCK

DEPR

ECIA

TION

NET

BLOC

K

S.PA

RTIC

ULAR

SAS

ON

AS O

NAS

ON

FOR

THE

DEDU

CTIO

NUP

TOAS

ON

AS O

NNo

.01

.04.

2010

ADDI

TION

DEDU

CTIO

N31

.03.

2011

01.0

4.20

10YE

AR31

.03.

2011

31.0

3.20

1131

.03.

2010

1LA

ND23

.36

237.

880.

0026

1.24

0.00

0.00

0.00

0.00

261.

2423

.36

2FA

CTO

RY B

UILD

ING

73.5

85.

8322

.25

57.1

67.

882.

444.

695.

6351

.53

65.7

0

3PL

ANT

& M

ACHI

NERY

219.

150.

0013

4.37

84.7

847

.59

10.2

247

.15

10.6

674

.12

171.

56

4GE

NERA

TOR

11.3

20.

009.

531.

792.

780.

522.

780.

521.

278.

54

5AI

R CO

NDIT

IONE

R3.

240.

003.

240.

000.

840.

150.

990.

000.

002.

40

6M

OBI

LE P

HONE

1.74

0.00

0.00

1.74

0.53

0.08

0.00

0.61

1.13

1.21

7VE

HICL

E45

.07

0.50

0.00

45.5

711

.18

4.29

0.00

15.4

730

.10

33.8

9

8CO

MPU

TER

9.19

2.60

11.1

50.

644.

481.

615.

790.

300.

344.

71

9O

FFIC

E EQ

UIPM

ENT

2.00

0.08

1.62

0.46

0.32

0.09

0.35

0.06

0.40

1.68

10FU

RNIT

URE

& FI

XTUR

E1.

580.

221.

210.

590.

260.

100.

280.

080.

511.

32

11W

EIG

HT S

CALE

1.50

0.00

1.29

0.21

0.16

0.07

0.20

0.03

0.18

1.34

12FI

RE E

XTIN

GUI

SHER

2.04

0.06

1.35

0.75

0.19

0.10

0.20

0.09

0.66

1.85

13EL

ECTR

ICAL

INST

ALLA

TIO

N4.

420.

340.

843.

920.

290.

220.

180.

333.

594.

13

14LA

B EQ

UIPM

ENT

10.6

011

.64

3.63

18.6

11.

330.

510.

841.

0017

.61

9.27

15CY

CLE

0.02

0.00

0.02

0.00

0.02

0.00

0.02

0.00

0.00

0.00

16RE

FRIG

ERAT

OR

0.14

0.00

0.14

0.00

0.03

0.01

0.04

0.00

0.00

0.11

17IN

VERT

ORS

& B

ATTE

RY0.

280.

000.

000.

280.

020.

010.

000.

030.

250.

26

18FA

N EX

HAUS

T &

COO

LER

0.10

0.00

0.00

0.10

0.00

0.00

0.00

0.00

0.10

0.10

19TR

ANSF

ORM

ER0.

870.

000.

000.

870.

040.

040.

000.

080.

790.

83

TOTA

L41

0.20

259.

1519

0.64

478.

7177

.94

20.4

663

.51

34.8

944

3.82

332.

2620

C.W

.I.P.

(Inc

ludi

ng A

dvan

ce5.

7314

14.4

65.

8314

14.3

60.

000.

000.

000.

0014

14.3

65.

73ag

ains

t Cap

ital G

oods

)

PREV

IOUS

YEA

R38

0.43

48.4

712

.97

415.

9360

.56

20.8

13.

4377

.94

337.

9931

9.87

©

on a

ccou

nt o

f ass

ets

lost

/dam

aged

in fi

re a

ccid

ent a

t Kan

pur U

nit (

refe

r not

e no

. 1 o

f Not

es to

Acc

ount

s)


32

SCHEDULES FORMING PART OF THE BALANCE SHEET (Contd...)(Rs. in Lacs)

As At As AtPARTICULARS31.03.2011 31.03.2010

SCHEDULE-6 : INVENTORIESMaterials in Stock 1159.89 888.96Less : Loss in fire ( refer note no. 1 of Notes to Accounts) 290.50 0.00

--------------------------------------------------------------------- ---------------------------------------------------------------------869.39 888.96

============================================== ==============================================Work-in-Process 16.94 51.24Less : Loss in fire ( refer note no. 1 of Notes to Accounts) 16.94 0.00

--------------------------------------------------------------------- ---------------------------------------------------------------------0.00 51.24

============================================== ==============================================Finished Goods 1170.39 474.47Less : Loss in fire ( refer note no. 1 of Notes to Accounts) 103.21 0.00

--------------------------------------------------------------------- ---------------------------------------------------------------------1067.18 474.47

--------------------------------------------------------------------- ---------------------------------------------------------------------TOTAL 1936.57 1414.67

============================================== ==============================================

SCHEDULE-7 : SUNDRY DEBTORSDebts outstanding for less than six months-Considered Good 3905.29 1656.56

Others 135.88 28.18--------------------------------------------------------------------- ---------------------------------------------------------------------

TOTAL 4041.17 1684.74============================================== ==============================================

SCHEDULE-8 : CASH & BANK BALANCESCash in Hand 16.97 16.28

Balance with Scheduled Banks 0.54 0.28

FDR with Banks 452.57 112.20

Interest Accrued on FDR 25.38 15.88--------------------------------------------------------------------- ---------------------------------------------------------------------

TOTAL 495.46 144.64============================================== ==============================================

SCHEDULE-9 : LOANS & ADVANCES(Unsecured considered good unless otherwise stated)

Advance recoverable in cash or in kind for value to be received

Advance to Suppliers 216.49 17.14

Security Deposit 56.22 2.97

Advance to Staff 1.07 0.00

Insurance Claim pending adjudication 556.42 0.00

(Refer Note No.1 of Notes to Accounts)

Advance to Others 80.10 24.47--------------------------------------------------------------------- ---------------------------------------------------------------------

TOTAL 910.30 44.58============================================== ==============================================

33

Tirupati Inks LimitedSCHEDULES FORMING PART OF THE BALANCE SHEET (Contd...)

(Rs. in Lacs)


SCHEDULE-10 : LIABILITIES(I) Sundry Creditors

(a) MSME 454.11 118.92(b) Others 552.55 628.71

(II) Other Liabilities 47.80 64.12--------------------------------------------------------------------- ---------------------------------------------------------------------

TOTAL 1054.46 811.75============================================== ==============================================

SCHEDULE-11 : PROVISIONSFor Income Tax 75.83 68.58For Expenses 26.89 19.52

--------------------------------------------------------------------- ---------------------------------------------------------------------TOTAL 102.72 88.10

============================================== ==============================================

SCHEDULE-12 : SALESDomestic Sales 9431.55 6665.78Export Sales 284.10 434.01Add : Excise Duty 84.87 67.02

--------------------------------------------------------------------- ---------------------------------------------------------------------TOTAL 9800.52 7166.81

============================================== ==============================================

SCHEDULE-13 : OTHER INCOMEInterest on FDR 24.61 9.41

--------------------------------------------------------------------- ---------------------------------------------------------------------TOTAL 24.61 9.41

============================================== ==============================================

SCHEDULE-14 : INCREASE / (DECREASE) IN STOCKClosing Stock 1187.33 525.71Less : Opening Stock 525.71 178.84

--------------------------------------------------------------------- ---------------------------------------------------------------------TOTAL 661.62 346.87

============================================== ==============================================The closing stock of current year includes stock of Rs. 120.15 lacs lost in fire.

SCHEDULE-15 : MANUFACTURING EXPENSESWages & Salary 72.53 61.58Cylinder Design Purchases 0.05 1.80Freight & Cartage (Inwards) 15.57 12.85Toll Tax Inwards 0.18 0.43Power & Fuel 8.51 6.62Consumable Stores 2.25 5.60D.G.Running Expenses 0.09 1.54Loading & Unloading Expenses 0.18 0.21Laboratory Expenses 0.01 0.10Godown Rent 5.79 5.21Excise Duty Paid 70.46 78.58

--------------------------------------------------------------------- ---------------------------------------------------------------------TOTAL 175.62 174.52

============================================== ==============================================


34

SCHEDULES FORMING PART OF THE BALANCE SHEET (Contd...)(Rs. in Lacs)


SCHEDULE-16 : ADMINISTRATIVE EXPENSESRepair & Maintenance 4.60 2.14News Paper & Periodicals 0.03 0.02Telephone Expenses 7.25 5.91Insurance 4.85 4.57Office Expenses 3.78 1.02Legal & Professional Charges 9.69 7.27Vehicles Running & Maintenance 5.52 5.38Postage & Telegram 2.09 1.88Printing & Stationery 3.38 3.14Director Remuneration 12.12 14.52Director’s Sitting Fees 0.16 0.50ECGC Premium 0.73 0.86Generator Expenses 2.71 2.26Staff Welfare 2.65 2.48Retirement Benefits 2.25 5.50Audit Fee 0.80 0.80Computer Expenses 2.75 1.71Bonus 0.96 1.05Travelling/Conveyance Expenses 21.22 4.05Loss on Sale of Car 0.00 1.37Loss on Transit 0.00 0.13Listing Fees 0.74 0.08Fees & Subscription 1.89 8.22Rates & Taxes 0.84 0.13Employers Contribution on PF & ESIC 1.69 1.67Service Tax Expenses 0.15 0.04Sales Tax Expenses 0.29 0.92Security Expenses 1.17 0.53

--------------------------------------------------------------------- ---------------------------------------------------------------------TOTAL 94.31 78.15

============================================== ==============================================

SCHEDULE-17 : SELLING & DISTRIBUTION EXPENSESForeign Travelling Expenses 4.14 7.67Advertisement Expenses 6.56 1.78Freight & Cartage (Outward) 12.98 9.88Toll Tax Outwards 0.00 0.18Clearing & Forwarding Exp. on Export 19.10 20.32Commission on Sales 0.00 1.50Sample Expenses 2.54 4.98Rebate & Discount 6.02 1.38

--------------------------------------------------------------------- ---------------------------------------------------------------------TOTAL 51.34 47.69

============================================== ==============================================

SCHEDLUE-18 : FINANCIAL EXPENSESBank Interest/Charges 284.03 225.30Interest on Unsecured Loans 30.81 19.59Interest on Term Loan 6.63 10.04Interest on Vehicle Loan 1.74 3.32Interest on L.C. 5.88 81.84Interest (Others) 0.85 0.02

--------------------------------------------------------------------- ---------------------------------------------------------------------TOTAL 329.94 340.11

============================================== ==============================================

35

Tirupati Inks LimitedSIGNIFICANT ACCOUNTING POLICIES AND NOTES TO ACCOUNTS FORMING PART OF THE BALANCESHEET AS AT 31ST MARCH, 2011 AND PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31ST MARCH,2011.

SCHEDLUE-19 :

(A) SIGNIFICANT ACCOUNTING POLICIES1. Basis of Accounting

The financial statements have been prepared under the historical cost convention in accordance with generallyaccepted accounting principles in India, the accounting standards issued by the Institute of CharteredAccountants of India and the provisions of The Companies Act, 1956, as adopted consistently by the company.The Company follows the Mercantile System of accounting and recognizes items of income and expenditureon accrual basis.

2. Use of EstimatesThe preparation of financial statements in conformity with generally accepted accounting principles requiresmanagement to make estimates and assumptions that affect the reported amounts of assets and liabilitiesand disclosure of contingent assets and liabilities at the date of the financial statements and the reportedamount of revenues and expenses for the years presented. Actual results could differ from those estimates.

3. Recognition of Income and ExpenditureSales are recognized when goods are supplied and are recorded net of rebates and Sales Tax / VAT andinclusive of Excise Duty.Expenses are accounted for on accrual basis and provision is made for all known losses and expenses.Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Companyand the revenue can be reliably measured.

4. Fixed Assets and DepreciationThe Fixed Assets are stated at cost (Net of CENVAT and VAT where applicable) less accumulated depreciation.Depreciation is provided on additions and deletions on pro-rata basis on Straight Line Method at the ratesprovided in Schedule XIV of The Companies Act, 1956.

5. Impairment of AssetsWhenever events indicate that assets may be impaired, the assets are subject to a test of recoverabilitybased on estimates of future cash flows arising from continuing use of such assets and from its ultimatedisposal.A provision for impairment loss is recognized where it is probable that the carrying value of an asset exceedsthe amount to be recovered through use or sale of the asset.

6. InventoriesInventories are valued at lower of cost and net realizable value.a) Raw Materials : Average cost methodb) Finished Goods & Work in Progress : Includes conversion and other cost incurred in

bringing the inventories to their present locationand condition.

7. Retirement Benefitsa. The company contributes to the employees provident fund maintained under the Employees Provident

Fund Scheme of the Central Government and the same is charged to Profit & Loss A/c.b. Provision for Retirement Benefits is provided on the basis of actuarial valuation carried out at the year

end.8. Insurance Claims

Insurance claims are accounted for at the time of lodging the claim with the Insurance company. In case claimamount is greater than the book value of the assets / damaged, the accounting of claim is restricted to therespective book values of the assets lost/damaged.


36

9. TaxationTax expense comprises of Current and Deferred Tax. Current Income Tax is measured at the amount expectedto be paid to the tax authorities in accordance with the Indian Income Tax Act, 1961.Deferred Tax is measured based on the tax rates and the tax laws enacted or substantively enacted at theBalance Sheet date.Deferred Tax is recognized, subject to the considerations of prudence, on timing differences, being the differencebetween taxable income that originate in one period and are capable of reversal in one or more subsequentperiods.

10. Contingent LiabilitiesProvision in respect of present obligation arising out of past events are made in Accounts when reliableestimates can be made of the amount of the obligation. Contingent Liabilities, if material, are disclosed by wayof Notes to Accounts ..

11. Miscellaneous ExpenditureCosts incurred in connection with raising capital are adjusted against the Securities Premium Account.

12. Borrowing costs attributable to acquisition or construction of qualifying assets are capitalized as part of thecost of such assets up to the date when such asset is ready for its intended use. Other borrowing costs arecharged to the Profit & Loss A/c.

SCHEDLUE-20 :

(B) NOTES TO ACCOUNTS1. In March,2011, a major fire erupted in the Kanpur Unit of the Company and caused damaged to the building,

plant & machinery and stocks. The loss was fully covered under the Insurance Policy. The Company hasalready lodged insurance claim of Rs. 675.00 lacs based on market value of assets lost/damaged in fire.However, as a prudent accounting policy, the company has accounted for only Rs. 556.42 lacs (Rs. 127.13lacs for Fixed Assets & Rs. 429.29 towards stocks, including taxes) in its books of accounts as InsuranceClaim pending adjudication, being the book value of assets lost/destroyed in fire. Any excess/less value,being contingent in nature, will be adjusted at the time of final disposal of the Insurance Claim

2. In the fire accident at the Kanpur factory / corporate office, extensive damage was caused to the computers,stocks and accounting and other records. The annual accounts have been compiled after retrieval of data andrelated information from various sources, viz., copies of returns submitted with various governmentdepartments, copies of records available with Tax Consultants etc., and confirmations received from some ofthe Debtors and Creditors and other Parties. The Balances of certain current assets, Current liabilities &Loans & Advances are subject to reconciliation & confirmation from the respective parties.

3. Provision for taxation for the financial year 2010-11 represents Income Tax computed as per the normal rateof Income Tax prescribed under the Income Tax Act, 1961.

4. Cash Credit Limit, PC / FDB Limit and Bill Discounting Limit from Canara Bank of Rs.909.07 lacs, Rs.69.50lacs & Rs.167.89 lacs respectively are secured by hypothecation of Stocks & Book Debts on 1st chargeparipassu basis with Oriental Bank of Commerce (Consortium Member).Term Loan from Canara Bank of Rs.18.54 lacs is secured by hypothecation of Factory Land & Building, Plant& Machinery and Other Moveable Fixed Assets of the company on 1st charge paripassu basis with OrientalBank of Commerce (Consortium Member).Cash Credit Limit from Oriental Bank of Commerce of Rs.801.39 lacs is secured by hypothecation of Stocks,Book Debts & Other Current Assets of the company on 1st charge paripassu basis with Canara Bank.Term Loan from Oriental Bank of Commerce of Rs.18.89 lacs is secured by hypothecation of Fixed Assets ofthe company on 1st charge paripassu basis with Canara Bank.

5. Based on the information available with the company in respect of MSME (as defined in the Micro Small &Medium Enterprises Development Act, 2006) there are no delays in payment of dues to such enterprisesduring the period.The above information regarding Micro Small & Medium Enterprises has been determined to the extent suchparties have been identified on the basis of information available with the company. This has been relied uponby the auditor.

37

Tirupati Inks Limited6. Remuneration paid / payable to Managing Director and Whole Time Directors.

Year ended Year endedParticulars 31st March, 2011 31st March, 2010Director's Remuneration Rs. 12.12 lacs Rs.14.52 lacs

7. Remuneration paid / payable to AuditorsYear ended Year ended

Particulars 31st March, 2011 31st March, 2010Statutory Audit Fees Rs 0.80 lacs Rs 0.80 lacs

8. In the opinion of the board, the Current Assets, Loans & Advances are approximately of the value stated, ifrealized, in the ordinary course of business.

9. Unsecured loan from Directors includes Interest free loan of Rs. 40.65 lacs (previous year Rs.15.65 lacs)10. Deferred Taxation

Particulars As at As at31.03.11 31.03.10

Computation of Deferred Tax Assets/ LiabilitiesDeferred Tax Liabilities on account of Depreciation Difference 27.78 30.99Less : Deferred Tax Assets on Account of Disallowances 0.00 0.00

under Income Tax Act, 1961 27.78 30.99Net Deferred Tax Liabilities

11. The company has changed its registered office from B-4, UNESCO Apartments, Plot No.-55, I-P Extn.Patparganj, Delhi-110092 to 101, DDA Market, Hargobind Enclave, Vikas Marg Extn.,Delhi-110092 w.e.f01.12.2010

12. Capital Raised during the year: (Rs. In lacs)Public Issue 5150.00Bonus Issue NILRight Issue NILPrivate Placement NIL

13. Related Party Disclosures for the Year Ended 31-03-2011

List of Related Parties

1 Key Management Personnel Mr. Sanjiv AgarwalMr. Rakesh Kumar AgarwalSmt. Rajni Maheshwari

2 Relative of Key Management Personnel NIL

3 Enterprises that directly/indirectly through one or NILmore intermediaries control or controlled by, or undercommon control with, the company.

4 Associate Company NIL

5 Members or their relatives having significant influence NILover the Company by having an interest in the votingpower of the company

6 Enterprises in which substantial interest in the Ramdeo Polysters Pvt. Ltd.voting power is owned directly/indirectly by keymanagement personnel or their relatives includingdirectors and senior management of the company.


38

Details of Transaction with the Related Parties (Rs in lacs)

Particulars Key Relative of Enterprises Associate Members or EnterprisesManagement Key where Company their relatives in which

Personnel Management Control having substantialPersonnel Exit significant interest

influence

Rent Paid 0.00 0.00 0.00 0.00 0.00 1.20

Remuneration 12.12 0 0 0 0 0

14. Earning per share

Particulars 31.03.2011 31.03.2010Profit after Tax Rs. 253.23 Lacs Rs. 215.42 LacsWeighted Av. No. of Equity Shares 9278843 2971418Basic EPS Rs. 2.73 Rs. 7.25

15. The company has provided Excise Duty of Rs. 1,82,440.00 (previous year Rs. 2,23,267.00) on the finishedgoods lying in the premises as on the Balance Sheet date and included in the inventory value.

16. The company has come with a Further Public Offer (FPO) of 11976744 Equity Shares of Rs. 10/- for cash ata price of Rs.43/- (including securities premium of Rs.33/-) aggregating to Rs. 5150 Lacs in the month ofSeptember, 2010 through 100% Book Building Process. The share of the company stands listed on BombayStock Exchange Limited & Delhi Stock Exchange Association.

The funds raised through the Issue are intended to be utilized for setting up new facility for manufacturing ofSpecialty Inks like Digital Inks, UV Inks, Offset Printing Inks and Ink Concentrates to augment and supportexisting product range of the Company which include Rotogravure Inks and Flexographic Inks used in Printingof Flexible Packaging Material. In addition to this, the Issue Proceeds are also proposed to be used forCompany’s Inorganic Growth plans by way of acquisitions and strategic investments.

17. The company has written off its Share Issue Expenses amounting to Rs. 175.65 lacs by adjusting it againstSecurities Premium Account.

18. All the figures have been rounded off to the nearest lacs rupees.

19. Additional Information where applicable pursuant to the provisions of Schedules VI of The Company Act1956, is a under:-

A. Licensed Capacity:The Company is not required to obtain License under the Industrial Development & Regulation Act, asinformed by the management ; therefore the said details are not applicable.

B. Installed Capacity (Printing Inks) 2520.00 M.T p.a.Note: Installed capacity is on the basis of three shifts working as certified by the management and beinga technical matter, relied upon by the auditor without verification. The above capacity does not includecapacity of 3000 M.T. p.a. on the basis of 3 shifts working of Kanpur unit which has been closed onaccount of fire.

C. Statement of Finished Goods (Rs. In Lacs)S.No. Particulars Opening Purchase/ Sales Stock Closing

Management Stock as Production lost in Stock as onPersonnel on 01.04.2010 fire 31.03.2011

1 Printing Inks/ Ink ReducerKgs. 81310.000 2505352.610 2463556.159 71667.000 51439.451Amount 109.14 3819.10 103.21 90.43

2 Poly FilmsKgs. 284405.690 3994874.647 3746305.887 0 532974.450Amount 365.33 5981.42 976.75

39

Tirupati Inks LimitedD. Raw Materials Consumed / Purchases (Rs. in Lacs)

Particulars Year Ended 31st March, 2011Unit Qty Amt

Chemicals KG 681454.226 354.09Pigments & Dyes KG 48541.265 129.44Resin KG 93215.658 169.82Packing Materials NO 20760 27.00Printing Inks KG 1681339.610 2833.70Polyester Films KG 3994874.647 5966.29Total 9480.34

E. Value of Imported & Indigenous Raw Material Consumed/ Purchases and Percentage with TotalConsumption (Rs. in Lacs)

Particulars Year Ended 31st March, 2011% Rs.

Imported 0 0Indigenous 100 9480.34TOTAL 100 9480.34

F. Expenditure in Foreign Currency (on payment basis) (Rs. in Lacs)

Particulars Year Ended 31st March, 2011Purchase of Lab Equipments 4.17Advance against purchase of Raw Materials 35.39Advance against purchase of Capital Goods 1246.95Foreign Travelling 4.14

G. Earnings in Foreign Currency (Rs. in Lacs)Particulars Year Ended 31st March, 2011

F.O.B Value on Sales 285.34

H. Amount remitted during the year in foreign currency on dividends and number of non – residentshareholders.................NIL

20. SEGMENT REPORTING:-Based on the guidelines of Accounting Standards on Segment Reporting (AS-17) issued by The Institute ofChartered Accountants of India, the Company’s primary business segment is Printing Inks & Polyester Films.Details of Business Segment to the extent available, are as follows:-

Primary Reportable Segments (Rs. in lacs)

Particulars Year Ended 31st March, 2011

Printing Inks Polyester TotalFilms

Business SegmentSegment Revenue 3819.10 5981.42 9800.52Segment Results 482.68 309.10 791.78Less: Unallocated Expenses - - 151.71Add: Interest & Other Income - - 24.61


40

Particulars Year Ended 31st March, 2011

Printing Inks Polyester TotalFilms

Less: Financial Expenses - - 329.94Profit Before Tax - - 334.74Less: Provision for Tax - - 81.51Profit After Tax - - 253.23Other Information:Segment Assets 4413.2 4160.59 8573.74Unallocated Assets - - 667.94Total Assets - - 9241.68Segment Liabilities 508.58 531.38 1039.96Unallocated Liabilities - - 2251.00Total Liabilities - - 3290.96Capital Expenditures 1658.65 - 1658.65Unallocated Capital Expenditures - - 9.13Total Capital Expenditures - - 1667.78Depreciation 12.76 - 12.76Unallocated Depreciation - - 7.70Total Depreciation - - 20.46

21. The details of deployment of funds of Rs. 5150.00 Lacs up to 31st March 2011, raised from Further PublicOffer (FPO) of the company during September, 2010 is as follows:- (Rs. In Lacs)

S. No. PARTICULARS As per ActualProspectus

1 Setting up of facility for manufacturing of 2425 1652.24

Specialty Inks & Ink Concentrates

2 Capital Expenditure on Lab Equipments for existing facilities 25 11.52

3 Proposed Acquisitions 500 0

4 Augmenting Working Capital Resources 1400 © 2959.09

5 General Corporate Purposes 500 0

6 Meeting the expenses of the Issue 300 175.65

Balance Unutilized1 Security Deposit with BSE (Refundable) 0 51.50

2 FDR with HDFC Bank, Adarsh Nagar, New Delhi 0 300

TOTAL 5150 5150

© pending utilization for designated purposes, funds used for working capital for optimum returns.

22. Previous year figures have been regrouped, rearranged & recast where considered necessary.

23. Schedules ‘1’ to ‘20’ form an integral part of the accounts for the year ended 31st March, 2011.

41

Tirupati Inks LimitedCASH FLOW STATEMENT FOR THE YEAR ENDING 31ST MARCH, 2011

As At 31.03.2011 As At 31.03.2010PARTICULARS

Amount (Rs. in Lacs) Amount (Rs. in Lacs)

(A) CASH FLOW FROM OPERATING ACTIVITIESNet Profit Before Tax 334.74 296.23Add: Depreciation 20.46 20.81Interest Expenses 329.94 340.11Loss on Sale of Fixed Assets 0.00 1.37Less: Interest Income ( - ) 24.61 ( - ) 9.41

------------------------------------------------------- -------------------------------------------------------Operating Profit Before Working Capital Changes 660.53 649.11Adjusted forInventories ( - ) 521.90 ( - ) 220.96Sundry Debtors ( - ) 2356.43 ( - ) 965.14Loans & Advances ( - ) 865.72 46.02Current Liabilities 242.71 370.82Provision for Expenses 7.37 6.08

------------------------------------------------------- -------------------------------------------------------Cash Generated from Operations ( - ) 2833.44 ( - ) 114.07Tax Paid ( - ) 77.47 ( - ) 12.56

------------------------------------------------------- -------------------------------------------------------NET CASH FLOW FROM OPERATING ACTIVITIES ( - ) 2910.91 ( - ) 126.63

===================================== =====================================

(B) CASH FLOW FROM INVESTING ACTIVITIESPurchase of Fixed Assets ( - ) 259.15 ( - ) 46.36C.W.I.P. (Including Advance against Capital Goods) ( - ) 1408.63 0.00Sale of Fixed Assets 0.00 2.51Fixed Assets lost in Fire ( Refer Note No. 1 of Notes to accounts) 127.13 0.00Subsidy Received Against Fixed Assets 0.00 3.55Interest Income 24.61 9.41

------------------------------------------------------- -------------------------------------------------------NET CASH FLOW FROM INVESTING ACTIVITIES ( - ) 1516.04 ( - ) 30.89

===================================== =====================================

(C) CASH FLOW FROM FINANCING ACTIVITIESShare Capital 1197.68 36.00Secured Loans 396.30 385.09Unsecured Loans ( - ) 301.53 153.68Securities Premium 3952.33 0.00Public Issue Expenses ( - ) 137.07 ( - ) 38.58Interest Expenses ( - ) 329.94 ( - ) 340.11

------------------------------------------------------- -------------------------------------------------------NET CASH FLOW FROM FINANCING ACTIVITIES 4777.77 196.08

===================================== =====================================Net Cash Increase in Cash & Cash Equivalents 350.82 38.56Cash & Cash Equivalents at the Beginning of the Year 144.64 106.08Cash & Cash Equivalents at the End of the Year 495.46 144.64

Notes:1 The above Cash Flow Statement has been prepared under the Indirect Method setout in AS - 3 issued by The Institute of Chartered Accountants of India.2. Previous year figures have been re-grouped and re-arranged wherever considered necessary.

This is the Cash Flow Statement referred to in our report of even date





42

BALANCE SHEET ABSTRACT AND COMPANY’S GENERAL BUSINESS PROFILE

I. REGISTRATION DETAILS :

Registration No. State Code

Balance Sheet date

II. CAPITAL RAISED DURING THE YEAR (AMOUNT IN RS. THOUSANDS)

Public Issue Right Issue

Bonus Issue Private Placement

III. POSITION OF MOBILISATION AND DEPLOYMENT OF FUNDS (AMOUNT IN RS. THOUSAND)

Total Liabilities Total Assets

Sources of Funds

Paid up Capital Reserve and Surplus

Secured Loans Unsecured Loans

Share Application Money Deferred Tax Liability

Application of Funds

Net Fixed Assets Net Current Assets

IV. PERFORMANCE OF COMPANY (AMOUNT IN RS. THOUSANDS)

Turnover Total Expenditure

Profit/Loss Before Tax Profit/Loss After Tax

Earning per share in Rs. Dividend rate %

V. GENERIC NAMES OF THREE PRINCIPAL PRODUCTS/SERVICES OF COMPANY ( AS PER MONETARY TERMS)Product Description Item Code (ITS Code)a) Printing Inks

b) Polyester Film

L67120DL1984PLC017904

3 1 0 3 2 0 1 1

5 5

9 2 4 1 . 6 8

9 8 2 5 . 1 3 9 4 9 0 . 3 9

N I L

+

2 . 7 3

+

–

6 2 2 6 . 3 2

3 2 1 5 1 1 9 0 / 3 2 1 5 1 9 9 0

3 9 2 0 6 2 2 0

2 7 . 7 8

1 1 3 . 8 2

3 3 4 . 7 4 2 5 3 . 2 3

N I L

N I L

9 2 4 1 . 6 8

5 1 5 0 . 0 0 N I L

N I L

1 9 9 2 . 1 8

1 5 1 5 . 2 4 4 4 3 5 . 4 8

1 8 5 8 . 1 8

Folio No. ........................................

(To be filled in by the Shareholder)

TIRUPATI INKS LIMITEDTIRUPATI INKS LIMITEDTIRUPATI INKS LIMITEDTIRUPATI INKS LIMITEDTIRUPATI INKS LIMITEDPROXY FORM

I/We .............................................................................................................................................................................................................................................

of.......................................................................................................................................................................................................................................................................

being a member(s) of TIRUPATI INKS LIMITED, hereby appoint.......................................................................................................................................

...............................................................................................................................................................................................................................................................

of ..................................................................................................................................................................................................................................... or

failing him/her of ........................................................................................................................................................................................................................

as my/our proxy to attend and vote for me/us on my/our behalf at the 27th Annual General Meeting of the Company to be held on, 27th of September, 2011

and at any adjournment thereof. As witness my hand/our hands this day.................................of 2011.

DP-Id : ...................................................................................

Client-Id : ...................................................................................

Signed by the Said : ...............................................................................

NOTE : The proxy must be deposited at the Registered Office of the Company at 101, DDA Market, Hargovind Enclave, Vikas Marg Extn, Delhi - 110092 notless than 48 hours before the time of holding the Meeting.

TIRUPATI INKS LIMITEDTIRUPATI INKS LIMITEDTIRUPATI INKS LIMITEDTIRUPATI INKS LIMITEDTIRUPATI INKS LIMITEDATTENDANCE SLIP

27TH ANNUAL GENERAL MEETING

Time : 11.00 A.M., 27th day of September, 2011

Place : Lok Kala Manch, 20, Lodhi Institution Area, Lodhi Road, New Delhi

FULL NAME OF THE FIRST SHAREHOLDER.............................................................................................................................................................................

Joint Shareholders, if any.............................................................................................................................................................................................................

Father’s/Husband’s Name ............................................................................................................................................................................................................

Address in full...............................................................................................................................................................................................................................

FULL NAME(S) OF THE PERSON ATTENDING THE MEETING AS A PROXY/SHAREHOLDER(S)

.....................................................................................................................................................................................................................................................................

I/We hereby record my/our presence at the 27th Annual General Meeting held on Saturday, 27th day of September, 2011 at 11.00 A.M. Lok Kala Manch, 20,Lodhi Institution Area, Lodhi Road, New Delhi

Folio No. / DP-Id : ......................................................................................

Client-Id : ......................................................................................

No. of Shares : ...................................................................................... Signature(s).......................................................

Members may please note that the Auditorium Authorities do not permit carrying of bags/articles/snack packets etc. inside the meeting hall. The Companywill not make any arrangements for safe keeping of articles etc. outside the Hall. Members may make their own arrangements which shall be solely at theirrisk and cost and the Company will in no way be responsible for any loss/theft of articles etc.

AffixRe 1/-

RevenueStamp