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1

India Limited

NEYCER INDIA LIMITED

BOARD OF DIRECTORS

Mr. Krishna Prasad TripuraneniMr. Y. Mohan PrasadMr. B.S. Shailendra

AUDIT COMMITTEE

Mr. Krishna Prasad TripuraneniMr. Y. Mohan PrasadMr. B.S. Shailendra

INVESTORS’ GRIEVANCE COMMITTEE

Mr. Krishna Prasad Tripuraneni, ChairmanMr. Y. Mohan Prasad

AUDITORS

M/s. Suri & Co.Chartered Accountants,Chennai

LEGAL ADVISORS

Mr. T. Raghavan, ChennaiMr. R. Murari, ChennaiMr. R. Sankar Raman

BANKERS

Bank of IndiaIndian Overseas Bank

REGISTERED OFFICE

No. 33/24A, Ranjith RoadKotturpuramChennai - 600 085

WORKS

SANITARYWARE DIVISIONNeycer India LimitedVadalur - 607 303Cuddalore District, Tamilnadu

CONTENTS

Page No.

1. Notice to members 3

2. Director’s Report 5

3. Management Discussionsand Analysis 8

4. Corporate Governance 15

5. Auditors’ Report 16

6. Balance Sheet 20

7. Profit and Loss Account 21

8. Schedules 22

9. Notes on Accounts 29

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India Limited

BOARD OF DIRECTORS - BRIEF PROFILE

S.No.

NAME OF THE DIRECTOR PROFILE

1. Mr. Krishna Prasad Tripuraneni(55 Years)Director

2. Mr. Y. Mohan Prasad(60 Years)Director

3. Mr. B.S. Shailendra(57 Years)Director

Mr. Krishna Prasad Tripuraneni is thePromoter of Spartek. He has a Bachelorsdegree in Engineering from AndhraUniversity and MS in Electrical Engineeringfrom the Illinois Institute of TechnologyU.S.A.

Mr. Mohan Prasad has experience inConstuction Sector of India

Mr. B.S. Shailendar is a Science Graduatewith about 28 years experience in journalismand HR Administration functions withvarious Institutions

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India Limited

NOTICE TO THE SHAREHOLDERS

NOTICE is hereby given that the 50TH Annual General Meeting of the members of NeycerIndia Limited will be held on Thursday the 29th September 2011, at 10.00 AM at theRegistered Office of the Company to transact the following business:

ORDINARY BUSINESS

1. To consider and adopt the Audited Balance Sheet as at 31.03.2011 and the Profit and Loss Account for the year ended 31.03.2011 and the report of the Directors andAuditors thereon.

2. To appoint a Director in place of Shri Y. Mohan Prasad, who retires by rotation andbeing eligible, offers himself for re-appointment.

3. To appoint Auditors and fix their remuneration.

Place : Chennai By order of the BoardDate : 31-08-2011 for NEYCER INDIA LIMITED

DIRECTOR

B.S. Shailendra,

NOTES

A member entitled to attend and vote at the meeting is entitled to appoint a proxy toattend and vote instead of himself and that the proxy need not be a member.

1. Proxy, in order to be effective, should be lodged duly completed before 48 hours of themeeting.

2. Members are requested to intimate change of address, if any, to the company quotingtheir Ledger Folio Numbers.

3. Information pursuant to Clause 49 of the Listing Agreement for reappointment ofDirectors:

Particulars Item No.2

Name of the Director Mr. Y. Mohan Prasad

Date of appointment 14.02.2006

Qualification Matriculation

Experience in specific functional area Management Experience inLogistics and Construction sectors

Directorships held in other Stiles India limitedPublic Companies Spartek Ceramics India Limited

Committee Chairmanship/Membership held in other Companies Nil

Number of shares held in theCompany as on 31st March 2011 Nil

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India Limited

Your Directors have great pleasure inpresenting you the 50th Annual report of theCompany together with Audited Accountsfor the year ended 31.03.2011.

FINANCIAL RESULTS:

DIRECTORS REPORT

Net Sales 2057.68 1786.85

Other income 54.22 940.50

Profit before Interestand Depreciation 307.72 1148.37

Interest & financecosts 85.80 82.84

Cash Profit 221.92 1065.53

Depreciation 130.09 50.53

Profit for the year 91.83 1015.00

Members may be pleased to note that thecompany continued it’s profitable trend for3 Years in a row. The Directors are hopefulthat with the modernisation and capacityexpansion in Production and betterRealisation the Profitability will improvefurther.

Dividend:

In view of the accumulated losses, theDirectors express their inability to declaredividend.

Operational Results:

During the year under review, the Companyhas made a Net Sales turnover of Rs. 2057Lacs (Previous year Rs.1786 Lacs) andearned a net profit of Rs. 91.83 Lacs(Previous year Rs. 1015 lacs) Theproduction was 5638 MTs during the year(Previous year 4352 MTs).

The Company has already initiated steps forimplementation of the BIFR Schemeapproved by BIFR and major part of the

PARTICULARS(Rs. In Lakhs)

YEARENDED

31.03.2011

YEARENDED

31.03.2010

modernisation cum expansion program wascompleted and commenced CommercialProduction from the increased capacity on25th July 2010. By this the Installedcapacity of the company increased to 12500Metric Tonnes per annum. However, due todelays in obtaining additional workingcapital from banks and the enhancednatural gas supply from the suppliers, muchof the expanded capacity could not beoperational almost till the end of thefinancial year. Thus the benefits ofexpansion are not realised in the financialyear and excess fuel& operational costs wereincurred in the year due to these delays. Thecompany is strengthening its distributionnetwork by various means for effectivemarketing of additional Quantitative shiftin production.

Implementation of rehabilitationScheme sanctioned by BIFR

The Board for Industrial and FinancialReconstruction[ BIFR] has approved therehabilitation scheme of your company on06th October 2008 and the company hascompleted implementation of major activitiesapproved by BIFR.

In order to give effect to the variousrestructuring programmes as approved byBIFR, the Company has passed resolutionsfor reduction of capital and its re-consolidation thereof, issue of further equityshares to promoters on Preferential basis,issue of Optionally Convertible CumulativePreference Shares (OCCPS) and Warrants.These resolutions were passed throughPostal Ballot and the results of the PostalBallot were declared on 22nd July 2009.

Since the major facilities for increasing thecapacity has been installed , thecapitalization of the new Assets wascompleted during 2010-11. The companycommenced Commercial production fromits new facilities during the year 2010-11.

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India Limited

CORPORATE GOVERNANCEThe Management Discussion and AnalysisReport, a Report on Corporate governancetogether with the Auditors’ Certificate on thecompliance of conditions of CorporateGovernance are as placed as Annexure A andB respectively and forms part of thisDirectors’ Report.

DIRECTORS

Sri Y. Mohan Prasad, retires by rotation atthe ensuing Annual General Meeting, andbeing eligible, offer himself for re-appointment. The resolution for his re-election is being proposed at the ensuingAGM as an ordinary business.

DIRECTORS RESPONSIBILITYSTATEMENT

The Board of Directors report:

I. That in the preparation of AnnualAccounts the applicable accountingstandards had been followed along withproper explanation relating to materialdepartures;

II. That the Directors had selected suchaccounting policies and applied themconsistently and made judgments andestimates that are reasonable andprudent so as to give a true and fairview of the state of affairs of thecompany at the end of the financialyear and of the profit or loss of thecompany for that period;

III. That the directors had taken properand sufficient care for the maintenanceof adequate accounting records inaccordance with the provisions of theCompanies Act for safeguarding theassets of the company and preventingand detecting fraud and otherirregularities;

IV. That the directors had prepared theannual accounts on a going concernbasis.

AUDITORS REPORTWith regard to the observation of theauditors relating to non-provision of intereston the Term Loan and Loan from BodyCorporate, the Board wish to state that thesubject matter forms part of the Schemeapproved by the BIFR and hence notprovided.

With regard to observation of Auditors intheir report Annexure Clause “IX”, thestatutory dues mentioned are payable overa period of 2 years as per the BIFR directives.

Messrs. Suri & Co., Chartered Accountants,Chennai, the Company’s auditors retire atthe ensuing Annual General Meeting andbeing eligible offer themselves for re-appointment.

DEPOSITS

Your company has not accepted any fixeddeposits from the public during the yearunder review. As on date there is no depositwhich has matured and pending forpayment.

CONSERVATION OF ENERGY

The Company is taking necessary steps forenergy conservation. The new kiln whichis just commissioned is expected to savefuel consumption by at least 40%. Thepower was economically and optimallyutilised during the year. As the power costsare mounting from the Electricity Board,your company is exploring the possibility ofinstalling captive generation.

RESEARCH AND DEVELOPMENT

Your company has been continuouslypursuing the policy of cost reduction,improved productivity and developing newproducts in line with modern trends so asto differentiate “Neycer” brand from othercompetitors brands. The focus in thecurrent year will be on improved body andreduced costs along with new productsdevelopment

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FOREIGN EXCHANGE EARNINGS ANDOUTGO

The earnings on account of foreign exchangeduring the year under review was Rs nillakhs and the outgo on account of ForeignExchange was Rs.4.43 lakhs for TravelExpenditure

PERSONNEL & HUMAN RELATIONS

Your company was having very cordialrelations with the Trade unions and thesupport from the workers was extremelygood during the year. Your company is nowdeveloping senior management team tohandle the growth challenges in the years

ahead. There are no employees who are inreceipt of salary exceeding the limitsprescribed under Section 217 (2A) of theCompanies Act, 1956..

ACKNOWLEDGEMENT

The Board of Directors place on record theirappreciation for the co-operation they havereceived during the year from the FinancialInstitutions, Banks, Investors, Board forIndustrial and Financial Reconstruction,Suppliers, Customers, State Governmentsand Central Government and Employees ofthe company.

For and on behalf of the Board

Sd/- Sd/-Krishna Prasad Tripuraneni Y. Mohan Prasad

Director Director.

Place : ChennaiDate : 31-08-2011

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ANNEXURE A

Management Discussion and AnalysisReport:The financial year ending 31st March 2011,continues to be a difficult year of operations.Improvement in the market during the yearfor our products has resulted in theprofitability.

Industry Scenario and DevelopmentsIndia is a large, highly populated Countryof more than one billion people, with aneconomy, which is steadily growing. As perthe research reports, in India, more than60% of the population does not have accessto sanitation systems. There is also ashortage of 50 million dwelling units. Lowper capita consumption of sanitary ware(less than 2%), the perpetual shortage ofdwelling units outlines tremendous potentialfor sanitary ware products.

Housing and institutional sectors are themajor growth drivers. At present, housingdemand is rapidly rising and with increasingpurchasing power people have started takinginterest in premium sanitaryware products.Sanitaryware demand comes from newprojects as well as from replacement market.

Change in life style, high disposable income,concern for high quality toilets in middleincome group segment and above isresulting high growth of high end sanitaryproducts and this trend is likely to continuefor the next Decade. To capitalize on theemerging opportunities in sanitary wareindustry, all existing major players are goingfor capacity expansion and new entrants(including global brands) are setting upindustry in India despite strong entry barrierfor any new brand in the country.

Marketing and DistributionYour company is currently focusing towardsexpanding the distribution network and isin the process of expanding the sales teamand market coverage. Focus will be given

for ascertainment of market feedback on acontinuous basis so as to cater to the needsof the customers. Major thrust will be onintroducing new products and re-enter mostof the markets which were not serviced inthe earlier years due to capacity constraints.

Future outlook“Neycer” is one of the oldest & reputedsanitaryware brands, known for its colours,designs styles and superior products withinnovative features. Because of these factorsNEYCER is able to withstand stiffcompetition from other brands without anysignificant investment in advertisement andpromotion in the past decade.

NEYCER has planned for modernization,capacity expansion of its existing manu-facturing facilities at Vadalur by installingnew modern imported kiln. Your companyhas increased its utilisation capacity from5000 Mts to 12500 Mts effective from July2010. With additional manpower trainingand additional working capital availabilityfrom the 2nd half of the current year, weexpect to improve the capacity utilisationand stabilisation of new capacity within thenext 18 months. New products developed byyour company have met with good responsefrom the trade and the main challenge will beto quickly improve the yields and outputwith increasing experience of the workforcefor these products.

Your company needs to take up the 2nd

phase of modernisation of the plant for thebalance portion, which will result in furtherfuel savings, improved productivity andreduced costs. The new investmentproposals will be discussed with the bankersand appropriate funding structures will bedecided. The company hopes to initiate thisphase of modernisation within this financialyear.

Thus, despite many external adversitiesbeyond the control of the company in the

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past 10 years, your company successfullywithstood these and the restructuringprocess has been commenced by August2009 onwards, over a period of two yearsthe Directors of the company are confidentof wiping the existing losses in the Books.

Your Directors optimistically look forwardto the growth years ahead from nowonwards.

Financial PerformanceThe improved financial performance of thecompany for the year ended 31st March 2011is substantially due to various measuresadopted in the manufacturing facilitieswhich has resulted a cash profit of Rs.221.92

Lacs. Despite the constraints of workingcapital, the company expects improvedperformance in the current year

Human ResourcesThis has been dealt in the Directors’ Reportto the Shareholders.

Cautionary StatementStatements in this Management Discussionand Analysis Report giving company’sobjective, projections, estimates andexpectations may constitute “forwardlooking statements” within the meaning ofapplicable laws and regulations. Actualresults might differ materially from thoseeither expressed or implied.

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Report on Corporate Governance: 1. Company’s philosophy on Corporate

Governance

We at Neycer India Limited believe thatCorporate Governance is a systematicprocess by which Company’s goals aredirected and controlled to enhance theirgenerating capacity. Neycer also believesthat it must maintain good standard ofcorporate conduct towards its employees,consumers and society.

At Neycer we believe that a Companyneeds to leverage resources to translateopportunities into reality; to infuse peoplewith a vision, which sparks dynamismand entrepreneurship, creates a systemof succession which combines stabilitywith flexibility and continuity withchange.

Above all else, corporate governancemust balance individual interest withcorporate goals and operate withinaccepted norms of propriety, equity, fairplay and a sense of justice. Achievingthis balance depends upon howaccountable and transparent companies

are. Accountability improves decisionmaking. Transparency helps to explainthe rationale behind decisions, andthereby builds stakeholder confidence.

2. BOARD OF DIRECTORS

a) Composition:

As on 31.03.2011, the Board of Directors ofthe Company consisted of three Directors.

i) Independent : Mr.Y.Mohan PrasadDirectors : Mr.B.S.Shailendra

ii) Non-independentDirectors : Nil

iii) Promoter : Mr. Krishna PrasadDirectors Tripuraneni

Independent Directors apart from attendingBoard and Committee Meetings did not haveany other material financial relationship ortransactions with the Company, which, inthe opinion of the Board, may influencedecision making of the Directors.

Mr. Krishna Prasad Tirupuraneni has beenappointed as Wholetime Director w.e.f 1st

April, 2010.

ANNEXURE B

b) Board Meetings: During the financial year 2010-11 7 (Seven) Board Meetings were held on29.04.2010, 31.07.2010, 27.08.2010, 30.10.2010, 13.11.2010, 08.12.2010, and12.02.2011.

Number of Directorships in otherPublic companies and Committee

Members / Chairmanships *

AttendanceParticulars

BoardMeetings

Last AGM(Yes/No)

CategoryName of theDirector Other

Directorships

CommitteeMemberships(other than

Neycer)

CommitteeMemberships(other than

Neycer)

Mr.Krishana Prasad PromoterTripuraneni Director 7 Yes Nil Nil Nil

Mr Y Mohan Prasad IndependentDirector 7 Yes 2 Nil Nil

Mr B S Shailendra IndependentDirector 7 Yes 2 Nil Nil

* excludes private limited companies, foreign companies and companies under section25 of the Companies Act, 1956.

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India Limited

3) AUDIT COMMITTEE a) Constitution

The Audit Committee of the Company is in existence for long time even muchearlier to the regulations relating to Corporate Governance came into existence. Atpresent, the Committee consist of three members viz., Mr. Krishna PrasadTripuraneni, Mr Y Mohan Prasad and Mr B S Shailender.

b) The Terms of Reference of Audit Committee are in accordance with paragraphC&D of Clause 49(1) of the Listing Agreements and Section 292A of the CompaniesAct, 1956 and inter-alia include the following:

i. Review of Company’s financial reporting process

ii. Reviewing the Company’s financial and risk management policies

iii. Review of quarterly, half-yearly and annual financial statements beforesubmission to the Board.

iv. Review with Internal Auditors on significant observations

v. Recommending appointment of Internal Auditor and fixation of fees

vi. Review of adequacy of internal audit function and internal audit plan for the year

vii. Review of adequacy of internal control system

c) The Committee has met five times during the year ended 31st March 2011.

Name of the Director Category of No.of Committee No.of Committeemembership Meetings held Meetings Attended

Mr Krishna Prasad PromoterTripuraneni Director 5 5

Mr Y Mohana Prasad IndependentDirector 5 5

Mr B S Shailendra IndependentDirector 5 5

4) REMUNERATION OF DIRECTORS The Company has not formed a Remuneration Committee of the Board of Directors.None of the Directors draw any remuneration. The Sitting Fees of Rs.250/- per meetingfor attending the Board and Committee Meetings which is within the permitted limitsunder the Companies Act, 1956 has also been waived by the directors. The actualtravel and incidental expenses incurred for attending meetings are only reimbursed. Thedetails of sitting fees paid are as follows.

Name of the Director Rs.

Mr Krishna Prasad Tripuraneni Nil

Mr Y Mohana Prasad Nil

Mr B S Shailendra Nil

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5) SHAREHOLDERS / INVESTORS GRIEVANCE COMMITTEE Terms of reference: Shareholders / Investors’ Grievance Committee was constitutedto specifically focus on investor service levels.

Mr.Krishna Prasad Tripuraneni is the Chairman of the Shareholders / Investors’Grievance Committee. During the Financial Year 2010-2011, 8 complaints werereceived from shareholders and were replied / redressed to the satisfaction of theinvestors.

There are no pending transfers as on 31.03.2011 except one transmission whereincertain documents are yet to be submitted by the shareholder.

Mr. Sankar Balaji is the Compliance Officer of the Company.6) GENERAL BODY MEETINGS

The details of date, venue and time of the last three years’ General Body Meetingsare given below:

Year Location Date & Time

47th AGM- 2008 At Registered Office33/24-A Ranjith Road December 29, 2008Kotturpuram, Chennai - 85 11.00A.M.

48th AGM -2009 At Registered Office33/24-A Ranjith Road September 30, 2009Kotturpuram Chennai - 85 11.00A.M.

49th AGM -2010 At Registered Office33/24-A Ranjith Road September 30, 2009Kotturpuram Chennai - 85 11.00A.M.

The Company obtained approval from the Shareholders through Postal Ballot forreduction of capital and its re-consolidation thereof, issue of further equity shares topromoters on Preferential basis, issue of Optionally Convertible Cumulative PreferenceShares (OCCPS), Warrants and the results were declared on 22nd July 2009. Theprocess of giving effect to the Postal Ballot Resolutions is still under progress.

7. DISCLOSURESNo materially significant related party transactions which may have potential conflictwith the interest of the company at large have taken place during the year.

Transactions with the related party are disclosed under Note No.16 on Accounts.

No penalty or strictures have been imposed on the Company by the Stock Exchange or SEBI or any statutory authority on any matter related to capital markets, duringthe last three years.

8. MEANS OF COMMUNICATIONThe quarterly results are being published in One English and in one Vernacular (Tamil)Newspaper

a) Quarterly results are forwarded to Stock Exchanges after the same is approved bythe Board

b) The financial result of the company has also been published in the company’swebsite. (www.neycer.in)

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c) No presentations made to the institutional investors or to analysts.d) Separate Management Discussion and Analysis Report annexed to the Directors

Report.

9. GENERAL SHAREHOLDER INFORMATION50th Anuual General Meeting

Date : 29th September 2011

Time : 10.00 a.m

Venue : No.33/24-A, Ranjit Road, Kotturpuram,Chennai-600 085

Financial Calendar :

Results for the quarter ending Within 45 days from the end of the quarterJune 30, 2011

Results for the quarter ending Within 45 days from the end of the quarterSeptember 30, 2011

Results for the quarter ending Within 45 days from the end of the quarterDecember 30, 2011

Results for the quarter ending Audited Results within 60 days from theMarch 31, 2012 end of the quarter

Annual General Meeting September 2012

Book Closure 27th September 2011 to 29th September 2011.

Dividend: No Dividend

The Company’s Equity Shares are listed on Bombay and Madras Stock Exchanges.Trading on the scripts has been temporarily suspended.

10. MARKET PRICE MOVEMENT

Shares are not traded and hence market quote is not available.

11. DISTRIBUTION OF SHAREHOLDING

S. No of % of No. of % ofNO Category Holders Holders Shares Shares

1. Upto 500 1580 89.82 245453 4.02

2. 501-1000 107 6.08 91497 1.50

3. 1001-2000 40 2.27 60680 0.99

4. 2001-3000 13 0.74 31950 0.52

5. 3001-4000 3 0.17 11240 0.18

6. 4001-5000 2 0.11 9450 0.15

7. 5001-10000 5 0.28 40350 0.66

8. 10001 and Above 9 0.53 5618960 91.98

Total 1759 100.00 6109580 100.00

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12. SHAREHOLDING PATTERN AS ON 31.03.2011

S.No. Category No of Holders No. of Shares % of Shares

1. Promoters & Directors 3 4864575 79.63

2. Bodies Corporates 16 14725 0.24

3. Banks, Mutual Funds &Insurance Companies 5 705475 11.55

4. Resident Indians 1735 524805 8.58

TOTAL 1759 6109580 100.00

13. DEMATERIALISATION OF SHARESThe Shares of the Company are not yet dematerialized. Action has been initiated todemat the shares

14. OUTSTANDING GDRs/ADRs/WARRANTS

Nil

15. PLANT LOCATION

Sanitaryware Plant : Vadalur – 607 303, Cuddalore District, Tamil Nau

16. ADDRESS FOR CORRSPONDENCE

Registered Office : Neycer India Limited33/24-A, Ranjit Road,Kotturpuram.Chennai-600085

Phone : 044-24471642/ 24471842,Fax : 044-24471641

For and on behalf of the Board

Sd/- Sd/-Krishna Prasad Tripuraneni Y. Mohan Prasad

Director Director.

Place: ChennaiDate : 31-08-2011

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17. CERTIFICATE ON COMPLIANCE WITH THE CONDITIONS OF CORPORATEGOVERNANCE UNDER CLAUSE 49 OF THE LISTING AGREEMENT(S)

To

The Members of Neycer India Limited

We have examined the compliance of conditions of Corporate Governance by Neycer India

Limited, for the year ended 31st March, 2011 as stipulated in Clause 49 of the Listing

Agreement of the said company with the Stock Exchange(s).

The Compliance of conditions of Corporate Governance is the responsibility of the

Management. Our examination was limited to procedures and implementation thereof,

adopted by the company for ensuing the compliance of the conditions of the Corporate

Governance. It is neither an audit nor an expression of opinion of the financial statements

of the Company.

In our opinion and to the best of our information and according to the explanations given

to us, we certify that the Company has complied with the conditions of Corporate

Governance as stipulated in the above mentioned Listing Agreement.

As required by the guidance note on certification of Corporate Governance issued by the

Institute of Chartered Accountants of India, we state that, there were no investor grievances

remaining pending for more than 30 days as per the records maintained by the Company

as at 31st March, 2011.

We further state that such compliance is neither an assurance as to the future viability of

the Company nor the efficiency or effectiveness with which the management has conducted

the affairs of the Company.

For SURI & CO.,Chartered AccountantsRegn No.:004283S

Sd/-Place: Chennai. R. MAHESHDate: 31-08-2011 Partner

Chartered AccountantsMembership No: 024775

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REPORT OF THE AUDITORS TO THE MEMBERS OFNEYCER INDIA LIMITED

We have audited the attached Balance Sheetof Neycer India Limited as at 31st March2011, the Profit & Loss Account for the yearended on that date, annexed thereto and theCash Flow Statement for the year ended thatdate. These Financial Statements are theresponsibility of the Company’s Manage-ment. Our responsibility is to express anopinion on these financial statements basedon our audit.

We conducted our audit in accordance withthe auditing standards generally acceptedin India. Those standards require that weplan and perform the audit to obtainreasonable assurance about whether thefinancial statements are free of materialmisstatement. An audit includes examining,on a test basis, evidence supporting theamounts and disclosures in the financialstatements. An audit also includes assessingthe accounting principles used andsignificant estimates made by themanagement, as well as evaluating theoverall financial statement presentation. Webelieve that our audit provides a reasonablebasis for our opinion.

As required by the Companies (Auditors’Report) order, 2003, as amended byCompanies (Auditors’ Report) (Amendment)order, 2004 issued by the CentralGovernment in terms of subsection (4A) ofsection 227 of the Companies Act 1956, weenclose in the annexure a statement on thematters specified in paragraph 4 and 5 ofthe said Order.

Further to the comments referred to above,we report that:

(i) We have obtained all the informationand explanations, which to the best ofour knowledge and belief were necessaryfor the purposes of our audit.

(ii) In our opinion, proper books of accountas required by law have been kept bythe company so far as appears from ourexamination of those books.

(iii) The company’s Balance Sheet and Profit& Loss Account dealt with by this report

are in agreement with the books ofaccount.

(iv) In our opinion, the Balance Sheet andProfit and Loss Account dealt with bythis report comply with the AccountingStandards referred to in Section 211(3C)of the Companies Act, 1956.

(v) On the basis of written representationsreceived from the Directors, as on 31st

March, 2011 and taken on record byBoard of Directors, we report that noneof the Directors is disqualified as on 31st

March, 2011 from being appointed asdirector in terms of clause (g) of sub-section (1) of section 274 of theCompanies Act, 1956.

(vi) In our opinion and to the best of ourinformation and according to theexplanations given to us, subject to nonprovision of interest on the TermLoan and Loan from Body Corporate,the quantum of which are notdeterminable the said accounts, readtogether with the notes thereon, give theinformation required by the CompaniesAct, 1956, in the manner so requiredand give a true and fair view inconformity with the accountingprinciples generally accepted in India:

a) In the case of the Balance sheet, ofthe state of affairs of the companyas at 31st March, 2011;

b) In the case of the Profit and LossAccount, of the Profit for the yearended on that date; and

c) In the case of the Cash FlowStatement, of the cash flows for theyear ended on that date.

Place: Chennai For Suri & CoDate: 31-08-2011 Firm Regn. No. 004283S

Sd/-R. MaheshPartnerChartered AccountantsMembership. No 024775

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I) a) The Company has maintainedproper records showing fullparticulars, including quantitativedetails and situation of Fixed Assets.

b) Physical verification of major itemsof these assets has been conductedby the management during thefinancial year and as explained tous, no material discrepancies werenoticed on such verification.

c) The Company has not disposed offsubstantial part of fixed assets.

II) a) Physical verification of Inventory hasbeen conducted by the managementat reasonable intervals. In ouropinion, the frequency of verificationis reasonable.

b) The procedures of physicalverification of inventories followed bythe management are reasonable andadequate in relation to the size ofthe company and the nature of itsbusiness.

c) The company is maintaining properrecords of inventory. No materialdiscrepancies were noticed onphysical verification as compared tothe book records.

III) a) The Company has not granted anyloans, secured or unsecured tocompanies, firms or other parties,covered in the Register maintainedunder Section 301 of the CompaniesAct, 1956.

b) The Company has not taken anyloans, secured or unsecured fromcompanies, firms or other parties,covered in the Register maintained

under Section 301 of the CompaniesAct, 1956.

IV) The Company has adequate internalcontrol system comensurate with thesize of the company and the nature ofits business, for the purchase ofinventory and fixed assets and for thesale of goods and services.

V) a) The transactions that need to beentered in the register maintainedunder section 301 of the Act havebeen so entered.

b) According to the information andexplanations furnished to us thesetransactions have been made atprices which are reasonable havingregard to the prevailing marketprices at the relevant time.

VI) The Company has not accepted anydeposits from the public within themeaning of Section 58A, 58AA or anyother relevant provisions of the Actand the Rules framed there under.

VII) The Company has an internal auditsystem commensurate with the sizeand the nature of its business.

VIII) The Central Government has notprescribed the maintenance of costrecords under section 209 (1) (d) ofthe Companies Act, 1956.

IX) a) The Company is depositingundisputed statutory dues includingProvident Fund, Employees’ StateInsurance, Investors’ Education andProtection Fund, Income Tax, SalesTax, Wealth Tax, Service Tax, ExciseDuty, Customs Duty, Cess and other

ANNEXURE TO AUDITORS’ REPORT

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statutory dues with the appropriateauthorities belatedly and there areoutstanding statutory dues as at thelast day of the financial yearconcerned for a period of more thansix months from the date theybecame payable. The extent of the

Sales Tax Act Sales Tax 1,04,10,808 Nil Assessing authorities andAppellate Authorities

Name of theStatute

Nature ofDues

Amount Disputed(Rs.)

Amount paid(Rs.)

Forum wheredispute is pending

outstanding are as under:

Nature of the dues Amount Due (Rs.)

Sales Tax 1,70,80,877

Excise Duty 53,07,103

Provident Fund 4,21,958

b) There are disputed dues of tax which have not been deposited and the amountinvolved and the forum where disputes are pending are as under:

X) The Company has accumulatedlosses exceeding fifty per cent of itsnet worth and has not incurred cashloss in the current financial year andin the immediately precedingfinancial year.

XI) In our opinion and according to theinformation and explanations givento us, the company has defaulted inrepayment of dues to banks, theextent and quantum of which is notdeterminable at present.

XII) The Company has not granted loansand advances on the basis of securityby way of pledge of shares,debentures and other securities.

XIII) The Company is not engaged in thebusiness of nidhi / mutual benefitfund/society and hence the questionregarding application of specialstatute does not arise.

XIV) The Company is not dealing ortrading in shares, securities,debentures and other investments.

XV) The Company has not given anyguarantee for loans taken by others

from banks or financial institutions.

XVI) The Company has applied the termloan for the purpose for which thesame was obtained.

XVII) According to the information andexplanations given to us and on anoverall examination of the BalanceSheet of the company, we report thatthe company has not used fundsraised on short-term basis for longterm investment.

XVIII) The Company has not made anypreferential allotment of shares toparties and companies covered in theRegister maintained under section301 of the Act during this year.

XIX) The Company has not issued anydebentures.

XX) The Company has not raised anymoney by public issues during theyear.

XXI) According to the information andexplanations given to us, no fraud onor by the company has been noticedor reported during the year.

Place: Chennai For Suri & CoDate: 31-08-2011 Firm Regn No: 004283S

Sd/-R. MaheshPartnerChartered AccountantsMembership No 024775

18

India Limited

NEYCER INDIA LIMITEDBALANCE SHEET AS AT 31ST MARCH 2011

Schedule 31-Mar-11 31-Mar-10Rs. Rs.

I. SOURCES OF FUNDS1. Shareholders’ Funds

(a) Capital 1 6 12 45 800 6 12 45 800

(b) Share Application Money Pending Allotment 6 00 00 000 6 00 00 000

(c) Reserves and Surplus 2 26 06 868 26 06 868

12 38 52 668 12 38 52 6682. Loan Funds

Secured Loans 3 25 25 40 937 23 66 56 871

Total 37 63 93 605 36 05 09 539II. APPLICATION OF FUNDS:

1. Fixed Assets 4

(a) Gross Block 30 12 58 074 12 66 84 676

(b) Less: Depreciation 9 35 61 593 8 05 52 768

(c) Net Block 20 76 96 481 4 61 31 908(d) Capital Work-in-Progress 51 32 517 12 20 98 663

2. Investments 5 1 50 000 1 50 0003. Current Assets, Loans and Advances

(a) Inventories 6 6 84 35 559 4 97 36 151(b) Sundry Debtors 7 3 78 36 239 3 25 32 403(c) Cash & Bank Balances 8 1 23 74 376 4 14 63 312(d) Loans & Advances 9 2 15 58 258 2 07 74 524

14 02 04 432 14 45 06 390 Less: Current Liabilities and Provisions

(a) Liabilities 10 11 13 47 732 10 16 57 155(b) Provisions 11 3 50 72 660 2 95 34 249

14 64 20 392 13 11 91 404Net Current Assets ( 62 15 960) 1 33 14 986

4. Profit and Loss Account 19 49 92 017 20 41 75 432Less: Balance in General Reserve ( 2 53 61 450) (2 53 61 450)(As per Contra) 16 96 30 567 17 88 13 982

TOTAL 37 63 93 605 36 05 09 539Notes on Accounts 20

Schedules 1 to 11, 20 (Notes) and cash flow statement form part of this Balance Sheet

Vide our report of even date attachedFor Suri & Co.,

Chartered AccountantsFirm Reg. No. 004283S

Krishna Prasad Tripuraneni Y.Mohan Prasad Sd/-Director Director R. Mahesh

Place : Chennai PartnerDate : 31-08-2011 Membership No.024775

19

India Limited

NEYCER INDIA LIMITEDPROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31ST MARCH 2011

Schedule 31-Mar-11 31-Mar-10Rs. Rs.

INCOMESales 22 44 62 783 19 23 80 654Less: Excise Duty (1 86 94 384) (1 36 96 119)

20 57 68 399 17 86 84 535Profit on sale of Tiles Division — 9 09 02 536Other income 12 54 21 749 31 46 515Increase/(-)Decrease in stocks 13 1 55 50 302 ( 63 34 131) Total 22 67 40 449 26 63 99 455EXPENDITURERaw materials consumed 2 88 80 025 2 05 34 742Stores and spares consumed 60 92 618 44 29 383Purchases of traded goods 1 61 27 239 1 63 13 383Power and fuel 4 72 48 288 3 20 47 486Employee cost 14 6 60 09 220 4 98 99 313Repairs and maintenance 15 66 63 561 65 27 062Selling expenses 45 58 084 58 51 897Other expenses 16 2 00 89 172 1 43 80 639Tiles Division Expenditure 17 — 9 48 126Interest and finance charges 18 85 80 003 82 83 628Depreciation 1 30 08 825 50 52 758 Total 21 75 57 034 16 42 68 417Profit before prior period and extraordinary items 91 83 415 10 21 31 038

Prior Period Expenditure — 6 30 996

Profit Before Tax 91 83 415 10 15 00 042

Provision for Current Tax — —

Profit After Tax 91 83 415 10 15 00 042

Loss brought forward from previous year (20 41 75 432) (54 83 54 614)

(19 49 92 017) (44 68 54 572)

Less: Adjusted against balance in reconstruction account 19 — 24 26 79 140

Balance carried to Balance Sheet (19 49 92 017) (20 41 75 432)

Basic and Diluted Earnings per share (Face value Rs.10/-) 1.50 16.61Notes on Accounts 20

Schedules 12 to 20 (Notes) and cash flow statement form part of this Profit and Loss AccountVide our report of even date attached

For Suri & Co.,Chartered AccountantsFirm Reg. No. 004283S

Krishna Prasad Tripuraneni Y.Mohan Prasad Sd/-Director Director R. Mahesh

Place : Chennai PartnerDate : 31-08-2011 Membership No.024775

20

India Limited

Schedules to Balance Sheet 31-Mar-2011 31-Mar-2010Rs. Rs.

SCHEDULE -1 :SHARE CAPITALAuthorised:

3,00,000 Cumulative RedeemablePreference Shares of Rs. 10/- each 30 00 000 30 00 000

2,97,00,000 Equity Shares of Rs. 10/- each 29 70 00 000 29 70 00 000

30 00 00 000 30 00 00 000

Issued:

15,000 9.5% Cumulative RedeemablePreference Shares of Rs. 10/- each 1 50 000 1 50 000

61,66,315 Equity Shares of Rs. 10/- each 6 16 63 150 6 16 63 150

6 18 13 150 6 18 13 150

Subscribed, Called and Paid-up:

15,000 9.5% Cumulative Redeemable PreferenceShares of Rs. 10/- each fully paid up 1 50 000 1 50 000

61,09,580 9.5% Equity Shares of Rs. 10/- each 6 10 95 800 6 10 95 800fully paid up of the above

6 12 45 800 6 12 45 800

i) 17,700 have been allotted as fully paid-up by for consideration other than cash

ii) 4,20,000 have been allotted as fully paid-up Bonus shares by capitalisation of reserves.

iii) 47,64,800 are held by Spartek Ceramics India Limited, the Holding Company.

SCHEDULE -2 :RESERVES AND SURPLUS1. Capital Reserve:

As per last Balance Sheet 32 468 32 468

2. Central Subsidy:As per last Balance Sheet 25 00 000 25 00 000

3. Share Premium Account:As per last Balance Sheet 74 400 74 400

4. General Reserve:As per last Balance Sheet 2 53 61 450 2 53 61 450Less: Debit balance in Profit and ( 2 53 61 450) ( 2 53 61 450) Loss Account (As per Contra)

26 06 868 26 06 868

21

India Limited

Schedules to Balance Sheet (Contd.) 31-Mar-2011 31-Mar-2010

Rs. Rs.

SCHEDULE - 3SECURED LOANS:

From Bank:

Cash Credit 6 66 82 760 5 39 41 315

Term Loans 10 86 98 026 10 70 87 978

Vehicle loan (Hypothecation of car) 24 50 963

Less: Unmatured Finance Charges 2 90 812 21 60 151 6 27 578

From Others:

(a) Body Corporate 6 00 00 000 6 00 00 000

(b) Interest Free Excise Loan 1 50 00 000 1 50 00 000

25 25 40 937 23 66 56 871

Due within one year Rs.193.87 lakhs (Previous year Rs.153.52 lakhs)

NOTES:

a) Cash credit is secured by hypothecation of stores & spares, raw materials , stock -in-process, finished goods and book debts and first charge on the fixed assets of thecompany.

b) Term loans from Bank and Body Corporate are secured by a second charge on thefixed assets and movables of the company, present and future, subject to prior chargecreated in favour of company’s bankers, of stock of raw materials, finished goods,stores etc and shall rank pari passu among themselves.

31-Mar-2011 31-Mar-2010

Rs. Rs.SCHEDULE - 5INVESTMENTS

Long Term Investments

Not Trade Unquoted

1500 fully paid up shares of Rs.100 each in

Neycer Employees Consumers Credit

Co-operative Society Limited 1 50 000 1 50 000

1 50 000 1 50 000

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23

India Limited

Schedules to Balance Sheet (Contd.) 31-Mar-2011 31-Mar-2010Rs. Rs.

SCHEDULE - 6INVENTORIES

Stores, Spares and Moulds 99 79 466 70 63 936

Loose Tools 1 07 336 1 49 951

Raw Materials 23 60 915 20 84 724

Stock in Trade-Finished Goods 4 73 73 204 3 35 44 624

Process Stock 54 52 021 32 08 318

Merchandise fitting 31 62 617 36 84 598

6 84 35 559 4 97 36 151

SCHEDULE - 7SUNDRY DEBTORS

Secured - considered good

a) Exceeding six months 26 51 069 23 95 046

b) Other debts 14 75 514 11 72 275

Unsecured

a) Exceeding six months-Considered good 1 22 27 815 41 10 963

b) Considered doubtful 3 79 73 099 3 79 73 099

Less: Provision for Doubtful Debts (3 79 73 099) (3 79 73 099)

c) Other debts-Considered good 2 14 81 841 2 48 54 119

3 78 36 239 3 25 32 403

SCHEDULE - 8CASH AND BANK BALANCES

Cash on hand 42 687 1 48 198

Balances with Scheduled banks:

- in Current Accounts 37 01 432 23 47 004

- in Deposit Accounts 84 15 374 3 87 91 796

(Include L.C. and Margin on Guaranteedeposits of Rs. 13 12 610)

- in Margin Money Accounts 2 14 884 1 76 314

1 23 74 376 4 14 63 312

24

India Limited


Rs. Rs.SCHEDULE - 9LOANS AND ADVANCES(Advances recoverable in cash or in kind or for value to be received)Tax Payments pending adjustments 7 05 071 5 57 675Deposits 14 74 805 14 81 689Other Advances:

Unsecured - considered good 1 93 78 382 1 87 35 160Unsecured - considered doubtful 14 51 537 14 51 537Less: Provision ( 14 51 537) ( 14 51 537)

2 15 58 258 2 07 74 524SCHEDULE - 10CURRENT LIABILITIESSundry Creditors:

Due to Micro Enterprises and Small Enterprises — —Due to Creditors other than Micro Enterprises andSmall Enterprises 11 13 47 732 10 16 57 155Investor Education and Protection Fund — —

11 13 47 732 10 16 57 155SCHEDULE - 11PROVISIONSa) Provision for Fringe Benefit Tax 19 85 145 19 85 145b) Provision for gratuity 3 03 55 154 2 52 02 627c) Provision for leave salary 27 32 361 23 46 477

3 50 72 660 2 95 34 249SCHEDULE - 12OTHER INCOMEInterest received (TDS Rs. 1,47,396/-) 16 02 904 15 42 016Miscellaneous Income 9 14 600 12 29 143Creditors Written Back 29 04 245 3 75 356

54 21 749 31 46 515SCHEDULE - 13INCREASE/(DECREASE ) IN STOCKOpening Stock

-Process Stock 32 08 318 35 08 681 -Finished Stock including Merchandise fitting 3 72 29 222 4 32 62 990

Total 4 04 37 540 4 67 71 671Closing Stock:

-Process Stock 54 52 021 32 08 318 -Finished Stock including Merchandise fitting 5 05 35 821 3 72 29 222

Total 5 59 87 842 4 04 37 540

Increase/(-)Decrease in stocks 1 55 50 302 ( 63 34 131)

25

India Limited


Rs. Rs.SCHEDULE - 14EMPLOYEE COST

Salaries, wages and bonus 4 71 88 684 4 02 64 249

Contributions to provident and other funds 55 64 667 46 47 254

Welfare expenses 46 72 631 28 66 468

Provision for Gratuity 81 97 353 18 71 138

Provision for Leave salary 3 85 884 2 50 204

6 60 09 220 4 98 99 313

SCHEDULE - 15REPAIRS AND MAINTENANCE

-Buildings 6 71 278 10 65 430

-Machinery 33 09 420 31 04 138

-Others 26 82 863 23 57 494

66 63 561 65 27 062

SCHEDULE - 16OTHER EXPENSES

Insurance 2 91 930 1 52 466

Rent 10 71 073 10 37 500

Advertisement 1 08 246 2 30 005

Rates & Taxes 12 48 203 10 33 114

Printing and Stationary 5 58 428 2 31 933

Postage, Telegrams and Telephones 12 37 567 14 12 897

Travelling and Conveyance 89 59 760 73 71 397

Auditors Remuneration

-for audit 93 755 77 210

-for expenses 20 405 34 745

- for certification 8 824 9 375

Law Charges 14 500 26 000

Professional Charges 20 75 535 20 11 000

Increase / (-) Decrease in Excise Duty on Closing Stock 15 34 493 (27 09 197)

Miscellaneous Expenses 31 66 453 34 62 194

2 00 89 172 1 43 80 639

26

India Limited


Rs. Rs.SCHEDULE - 17

TILES DIVISION EXPENDITURE:

Security Charges — 3 36 796

Rates and Taxes — 5 97 770

Other Expenses — 13 559

— 9 48 126

SCHEDULE - 18

INTEREST AND FINANCE CHARGES

On Fixed loans 37 98 873 61 92 601

On other loans 41 44 417 12 04 384

Finance charges 6 36 713 8 86 643

85 80 003 82 83 628

SCHEDULE - 19

RECONSTRUCTION ACCOUNT

(Pursuant to the Rehabilitation Schemesanctioned by BIFR vide Order dated 06-10-2008)

Waiver by Holding company — 16 63 00 000

Waiver by Investors — 5 82 57 637

Write back of sundry creditors - Sanitaryware Division — 64 67 200

Write back of sundry creditors - Tiles Division — 1 16 54 303

— 24 26 79 140

27

India Limited

SCHEDULE-20

NOTES ON ACCOUNTS

A. SIGNIFICANT ACCOUNTING POLICIES:1) BASIS OF ACCOUNTING:

The accompanying financial statements have been prepared on the assumptionthat the company is a going concern and in accordance with the historical costconvention, generally accepted accounting principles and the AccountingStandards under the Companies Accounting Standards Rules, 2006

2) FIXED ASSETS AND CAPITAL WORK IN PROGRESS:

Fixed Assets are stated at historical cost less accumulated depreciation. Cost ofthe fixed asset is inclusive of freight, installation, duties and other incidentalexpenses but excludes taxes and duties that are recoverable subsequently fromthe taxing authorities.

Capital work in progress comprise of cost of fixed assets that are not ready fortheir intended use as at the balance sheet date.

3) DEPRECIATION:

Buildings, Plant and Machinery and electrical installations are depreciated onstraight line method and Other assets on Written down Value basis at the ratesprescribed in Schedule XIV to the Companies Act, 1956.

4) INVESTMENTS:

Long term investments are stated at cost. Provision for diminution in the value oflong term investments is made if such decline is other than temporary in theopinion of the management.

5) INVENTORIES:

Inventories are valued at lower of cost and net realizable value. Cost is determinedbased on monthly weighted average. Cost includes taxes, duties and other incidentalexpenses but excludes taxes and duties that are recoverable subsequently fromthe taxing authorities.

6) FOREIGN CURRENCY TRANSACTIONS:

The foreign currency transactions are accounted for at the exchange rates prevailingon the date of transactions. The fluctuation variation in respect of foreign currencytransactions remaining unsettled as at the end of the year are translated at therates prevailing on the last day of the year. Foreign exchange differences arerecognized in the profit and loss statement to the period in which they arise.

7) INCOME AND EXPENDITURE RECOGNITION:

Income is recognized and expenditure is accounted for on their accrual. Revenuefrom sale is recognized on transfer of significant risk and reward. Sales are inclusiveof excise duty and net of sales returns and trade discounts.

28

India Limited

8) INTANGIBLE ASSET:

Intangible assets are recognized only if there is any Future Economic Benefit.Research expenses are charged to revenue.

9) EMPLOYEE COST:

Short term employee benefits, in respect of leave salary, leave travel allowanceand reimbursement of medical expenses, the liability has been fully provided onundiscounted basis, in accordance with the schemes in force.

The contribution to provident fund ( Defined Contribution Plan ) as per theprovisions of the Employees, Provident Fund and Miscellaneous Provisions Act,1952 is recognized and charged to revenue.

The company’s liability towards retirement benefits, in the form of gratuity, andother retirement benefits(Defined Benefit Plans) is worked out on actuarial basisat the end of the year and is provided.

10) BORROWING COST:

Borrowing costs that are attributable to the qualifying assets are capitalized tillthe date of commissioning, as part of the cost of such assets. All other borrowingcosts are charged to revenue.

11) TAXES ON INCOME

i) Taxes on income are accrued in the same period as the revenue and expensesto which they relate and are reckoned as Current tax and Deferred tax.

ii) Current Taxes are measured at the amount expected to be paid to the taxationauthorities, using the applicable tax rates and tax laws.

iii) Deferred tax on account of Tax effect on the accumulated timing differencesthat arises between the Accounting income and Taxable income is measuredusing the tax rates and tax laws that have been enacted or substantively enactedby the Balance Sheet date.

iv) Deferred Tax Asset is recognized on reasonable certainty that sufficient futuretaxable income will be available.

12) IMPAIRMENT OF ASSETS:

As at each Balance Sheet date, the carrying amount of assets is tested forimpairment so as to determine the extent of recognition of provision for ofimpairment loss, if any, required or the reversal, if any, required of impairmentloss recognised in previous periods.

Where the carrying amount of an asset exceeds its recoverable amount, such excessis recognised as impairment loss and charged to revenue.

Schedule 20Notes on Accounts (Contd.)

29

India Limited


31st Mar. 2011 31st Mar. 2010Rs. Rs.

B. OTHERS:A) Claims against the Company not

acknowledged as debts 1 04 10 808 1 04 10 808B) Disputed award granted in arbitration

proceedings for which steps are beingtaken to set aside the award 11 69 62 910 11 69 62 910

Contingent liability in respect of:

a. Outstanding letter of credit 57 19 840 38 56 123

b. As a subscriber to a company limited byguarantee not having share capital 500 500

c. Arrears of dividend on cumulativepreference shares 92 030 92 030

d. Guarantee given by banks for export obligations 71 63 647 71 63 647

1. The company has been declared sick industrial company within the meaning of SickIndustrial Companies (Special Provisions) Act, 1985 .

2. The Company’s Promoters’ friends /associates have invested an amount of Rs. 6Crores. Out of this equity shares and OCCPS allotment will be considered inaccordance with the approved BIFR Scheme.

3. According to the provisions of Sections 80A of The Companies Act, 1956, the 9.5%Cumulative Redeemable Preference Shares of the Company, ought to have beenredeemed before 15th June 1993. Since the Company is a sick industrial Companywithin the meaning of the Sick Industrial Companies (Special Provisions ) Act , 1985,the company, based on legal opinion, had filed a petition, before BIFR, seeking leavefor redemption of the Preference Shares and the same is pending.

4. The company has not recognized interest dues on loans from banks and from bodycorporate up to 31-03-2011. The arrears of interest to an extent of Rs. 5.61 Crores,subject to reconciliation has been converted by the bank during the period into FundedInterest Term Loan. The repayment of FITL in EMI terms is to commence from January2012 and the same will be recognised as and when the funded interest is serviced.

5. Excise duty liability on Finished Goods held in stock amounting to Rs.44,50,147/-has been provided for. However this will have no bearing on the working results of theCompany since the value of closing stock has been adjusted by like amount.

6. Managerial Remuneration:

No Remuneration has been provided during the year.

7. No provision for taxation is considered necessary as the taxable income for the yearended 31st March 2011 is negative.

8. In the opinion of the management, current assets, loans & advances have value inrealization to the extent they are stated in the accounts.

30

India Limited


9 EMPLOYEE BENEFITS:

i) DEFINED BENEFIT SCHEMES:(I) GRATUITY (II) EARNED LEAVE

31.03.11 31.03.10 31.03.11 31.03.10(a) Assumptions (Weighted Average )

Discount Rate 8.00% 8.00% 8.00% 8.00%

Salary escalation Rate 5.00% 5.00% 5.00% 5.00%

Attrition rate 3.00% 3.00% 3.00% 3.00%

(b) Table showing changes in present value of obligations (Amounts in Rs.)

Present value of obligationsas at beginning of year 2 52 02 627 2 46 82 540 23 46 477 21 86 274

Interest Cost 18 92 837 19 74 603 1 87 718 1 74 902

Current Service Cost 17 65 597 11 28 869 2 54 131 2 50 025

Past service cost(Non vested Benefits) — — — —

Past service cost (Vested Benefits) — — — —

Benefits Paid 31 44 822 — — —

Actuarial (Gain) / Loss on obligation 48 18 914 ( 25 83 385) ( 55 965)( 2 64 724)

Present value of obligations as atend of year 3 03 55 154 2 52 02 627 27 32 361 23 46 477

(c) Table showing changes in the fair value of plan assets (Amounts in Rs.)

Fair value of plan assets atbeginning of year — — — —Expected return on plan assets — — — —Contributions — — — —Benefits paid — — — —Actuarial loss on plan assets — — — —Fair value of plan assets at the end of period — — — —

(d) Actual return on plan assetsExpected return on plan assets — — — —Actuarial Gain (Loss) on plan assets — — — —Actual return on plan assets — — — —

(e) Actuarial Gain / Loss recognizedActuarial gain/ (Loss) for theperiod- Obligation ( 48 18 914) 25 83 385 55 965 2 64 724

Actuarial gain/ (Loss) for theperiod - Plan assets — — — —

Total gain/ (Loss) for the year 48 18 914 ( 25 83 385) ( 55 965)( 2 64 724)

Actuarial gain/ (Loss) recognizedin the period. 48 18 914 ( 25 83 385) ( 55 965)( 2 64 724)

Unrecognized Actuarial (gain) /loss at the end of the year — — — —

31

India Limited

(i) GRATUITY (ii) EARNED LEAVE31.03.11 31.03.10 31.03.11 31.03.10

(f) The amounts to be recognized in the balance sheet

Present value of obligation 3 03 55 154 2 52 02 627 27 32 361 23 46 477

Fair value of plan assets — — — —

Difference 3 03 55 154 2 52 02 627 27 32 361 23 46 477

Unrecognized transitional liability — — — —

Unrecognized past service cost -non vested benefits — — — —

Liability recognized in thebalance sheet 3 03 55 154 2 52 02 627 27 32 361 23 46 477

(g) Amounts Recognized in statement of Profit & Loss (Amounts in Rs.)

Current Service cost 17 85 597 11 28 829 2 54 131 2 50 025

Interest Cost 18 92 837 19 74 603 1 87 718 1 74 902

Expected return on plan assets — — — —

Net Actuarial (gain) /loss recognized in the year 46 18 914 ( 25 83 386) ( 55 965)( 2 64 724)

Transitional liability recognizedduring the year — — — —

Past service cost(Non vested Benefits) — — — —

Past service cost(Vested Benefits) — — — —

Expenses Recognized instatement of Profit & Loss 82 97 348 5 20 086 3 85 884 1 60 203

(h) Statement showing movement in amounts of obligations and value of plan assets(i) GRATUITY (Amounts in Rs.)

2010-11 2009-10 2008-09 2007-08

Defined benefit obligations 3 03 55 154 2 52 02 627 2 46 82 540 2 18 29 000

Plan assets — — — —

Surplus / (deficit) (3 03 55 154) (2 52 02 627) (2 46 82 540) 2 18 29 000)

Experience adjustments onbenefit obligations ( 46 18 914) 25 83 386 ( 26 31 799) ( 15 11 480)

Experience adjustments onplan assets — — — —

(ii) EARNED LEAVE (Amounts in Rs.)

2010-11 2009-10 2008-09 2007-08

Defined benefit obligations 27 32 361 23 46 477 21 86 274 25 33 000

Plan assets — — — —

Surplus / (deficit) ( 27 32 361) ( 23 46 477) ( 21 86 274) ( 25 33 000)

Experience adjustments onbenefit obligations 55 965 2 64 724 8 84 593 ( 29 569)

Experience adjustments onplan assets — — — —

ii) DEFINED CONTRIBUTION PLANS:The company makes contribution towards employees provident fund, family pension fund,and employees state insurance scheme. Under the rules of these schemes the company isrequired to contribute a specified percentage of payroll cost. The company during the yearrecognized Rs. 50,51,717/- as expenses towards contribution to these plans.


32

India Limited

10. Information required by paragraphs 3, 4(C) and 4(D) of part II of Schedule VI to theCompanies Act, 1956.

a. Capacity & Production 31st Mar. 2011 31st Mar. 2010Tons Tons

(i) Licensed Capacity

Vitreous China Sanitary ware 10000 10000

Ceramic Floor Tiles 25000 25000

(ii) Installed Capacity

(As Certified by the Management)


Ceramic Floor Tiles — —

(iii) Actual Production


b. Turnover 2010-11 2009-2010Qty in Value in Qty in Value in

Mts. Rs. Mts. Rs.

i. Vitreous China Sanitary ware 5194 18 39 79 946 4772 16 03 51 299

ii. Ceramic Floor Tiles — — — —

iii. Traded items 2 17 88 453 1 83 33 236

20 57 68 399 17 86 84 535

c. Opening Stock & Closing Stock of GoodsOpening Stock

i. Vitreous China Sanitary ware 1363 3 35 44 624 1783 4 21 90 544


iii. Traded items — 36 84 598 — 10 72 446

3 72 29 222 4 32 62 990Closing Stocki. Vitreous China Sanitary ware 1807 4 73 73 204 1363 3 35 44 624


iii. Traded items — 31 62 617 — 36 84 598

5 05 35 821 3 72 29 222

d. Purchase of Traded Goods

(Various items) 1 61 27 239 1 63 13 383

33

India Limited

2010-2011 2009-2010

Qty in Value in Qty in Value in

Mts. Rs. Mts. Rs.

e. Raw Materials Consumed:

Clay 6466 1 27 79 492 5076 98 95 668

Quartz & Feldspar 2909 62 86 983 1617 24 37 749

Zirconium Opacifier 84 60 72 451 61 41 28 437

Glazes, Fritz and Stains 5 32 59 752 4 22 84 110

Chemicals & Others 238 4 81 347 128 17 88 778

9702 2 88 80 025 6886 2 05 34 742

f. Value of Imports on CIF basis

Raw Materials — —

Components & Spare Parts — —

Traded items — 6 72 213

g. Expenditure incurred in foreign currency:

Travelling Expenses 4 42 988 —

h. Consumptions of imported, indigenous Raw Materials, Stores & Spares

Raw Materials: % Rs. % Rs.

Imported 0.09 26,779 0.24 48,823

Indigenous 99.91 2 88 53 246 99.76 2 04 85 919

100 2 88 80 025 100 2 05 34 742

Stores & Spares:

Imported — — — —

Indigenous 100 60 92 618 100 44 29 383

100 60 92 618 100 44 29 383

11. Contracts remaining to be executedon Capital Account and not provided for 7 00 000 —

12. Selling expenses include:

a) Packing & Forwarding 45 88 663 28 55 101

b) Discounts & Rebates 2 69 421 1 88 954


34

India Limited

Schedule 20 31st Mar. 2011 31st Mar. 2010Notes on Accounts (Contd.) Rs. Rs.

13. Segment wise Revenue, results andCapital employed:

The company operates only one segment viz. Sanitary Ware

14. In the absence of information from the Company’s Creditors with regard to submissionof memorandum with the Specified Authority, as required under the Micro, Small andMedium Enterprise Development Act, 2006 the Company is unable to furnish theinformation under the said Act and The Companies Act 1956.

15. Previous year figures have been regrouped and reclassified wherever necessary toconform to current year classification.

16. Related Party Disclosure:

I) Associates:

a) Holding Company : Spartek Ceramics India Limited

b) Fellow Subsidiary : Stiles India Limited

II) Key Management personnel : Mr. Krishnaprasad Tripuraneni

S. No Particulars Associates Key ManagementPersonnel

Rs. Rs.

1. Purchases — —

2. Interest paid — —

3. Other services rendered — —

4. Sales — —

5. Remuneration — —

6. Sitting Fees paid to Directors — —

Vide our report of even date attachedfor Suri & Co

Firm Reg. No. 004283S

Sd/- R. Mahesh

Sd/- Sd/- PartnerKrishna Prasad Tripuraneni Y. Mohan Prasad Chartered Accountants

Director Director M.No:024775

Place: ChennaiDate: 31-08-2011

35

India Limited

NEYCER INDIA LIMITEDCASH FLOW STATEMENT FOR THE YEAR ENDED 31st MARCH 2011

A. CASH FLOW FROM OPERATING ACTIVITIES:

Net Profit / (Loss) Before tax 91 83 415 10 15 00 042

Add: Depreciation 1 30 08 825 50 52 758

Interest and finance charges 85 80 003 82 83 628

Less: Interest received ( 16 02 904) ( 19 17 372)

Profit on sale of Tiles Division — (9 09 02 536)

Creditors write back — ( 3 75 356)

2 91 69 339 2 16 41 164

Adjustment for changes in working capital

(Increase)/ Decrease in inventories ( 1 86 99 408) 43 24 224

(Increase)/ Decrease in sundry debtors ( 53 03 836) (1 24 26 087)

(Increase) /Decrease in loans and advances ( 7 83 734) ( 26 93 642)

Increase/ (Decrease) in current liabilities 96 90 577 (4 05 08 404)

Increase/ (Decrease) in other Provisions 55 38 411 90 435

(A) 1 96 11 349 (2 95 72 310)

B. CASH FLOW FROM INVESTING ACTIVITIES:

Acquisition of fixed assets ( 5 24 74 735) ( 27 36 607)

Sale of fixed assets — 10 71 00 000

Capital Work in Progress ( 51 32 516) (1 73 60 198)

(B) ( 5 76 07 251) 8 70 03 195

C. CASH FLOW FROM FINANCING ACTIVITIES:

Availment /(Repayment) of Secured loans 1 58 84 065 ( 2 29 30 205)

Availment /(Repayment) of Unsecured loans — ( 65 48 945)

Interest received 16 02 904 19 17 372

Interest and Finance Charges paid ( 85 80 003) ( 82 83 629)

(C) 89 06 996 (3 58 45 407)

NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS (A+B+C) ( 290 88 936) 2 15 85 478

Cash and cash equivalents as at 31.03.2010 (Opening Balance) 4 14 63 312 1 98 77 834

Cash and cash equivalents as at 31.03.2011 (Closing Balance) 1 23 74 376 4 14 63 312

Vide our Report of even date attachedfor Suri & Co.,

Sd/- Sd/- Firm Reg. No.004283SKrishna Prasad Tripuraneni Y.Mohan Prasad Sd/-

Director Director R. MaheshPartner

Place : Chennai Chartered AccountantsDate : 31/08/2011 Membership No.024775

31 March 2011Rs.

31 March 2010Rs.

NEYCER INDIA LIMITEDBALANCE SHEET ABSTRACT AND COMPANY BUSINESS PROFILE

(AS PER SCHEDULE VI, PART (IV) OF THE COMPANIES ACT, 1956)

I. REGISTRATION DETAILS

Registration No. 4 1 4 5 State Code 1 8

Balance Sheet Date 3 1 0 3 2 0 1 1

Date Month Year

II. CAPITAL RAISED DURING THE YEAR (AMOUNT in Rs. THOUSANDS)

Public Issue N I L Rights Issue N I L

Bonus Issue N I L Private Placement N I L

III. POSITION OF MOBILISATION AND DEVELOPMENT OF FUNDS (AMOUNT in Rs. THOUSANDS)

Total Liabilities 3 7 6 3 9 4 Total Assets 3 7 6 3 9 4

Sources of Funds

Paid-up Capital 6 1 2 4 6 Reserves & Surplus 2 6 0 7

Secured Loans 2 5 2 5 4 1 Share Application Money 6 0 0 0 0

Application of Funds

Net Fixed Assets 2 1 2 8 2 9 Investments 1 5 0

Net Current Assets - 6 2 1 6 Accoumulated Losses 1 6 9 6 3 1

Misc. Expenditure N I L Deferred Tax N I L

IV. PERFORMANCE OF COMPANY (AMOUNT in Rs. THOUSANDS)

Turnover 2 2 6 7 4 0 Total Expenditure 2 1 7 5 5 7

Profit/Loss(-) Before Tax 9 1 8 3 Profit/Loss(-) After Tax 9 1 8 3

Earnings per share 1.50 Dividend Rate % N I L

V. GENERIC NAME OF PRINCIPAL PRODUCT/SERVICES OF THE COMPANY (AS PER MONETARY TERMS)

Item Code No. (ITC Code) 6 9 1 0 1 0 0 0

Product Description V I T R E O U S C H I N A

S A N I T A R Y W A R E

Item Code No. (ITC Code) 6 9 0 8 9 0 0 2

Product Description C E R A M I C T I L E S

Sd/- Sd/-Place : Chennai Krishna Prasad Tripuraneni Y.Mohan PrasadDate : 31/08/2011 Director Director

36

NEYCER INDIA LIMITEDRegd. Office : New No. 33, Old No. 24-A, Ranjith Road

Kotturpuram, Chennai - 600 085

50th Annual General MeetingADMISSION SLIP

Folio No.................................(To be filled by Shareholder)

I declare that I am a Registered Shareholder of the Company and hold............number of EquityShares.

............................................................. ...............................................Name of the Member in BLOCK LETTERS MEMBER’S SIGNATURE

NOTES :1) A member/proxy attending the Meeting must complete this Admission slip and hand it over at

the entrance.

2) Member intending to appoint a proxy, should complete the Proxy Form below and deposit it atthe Registered Office of the Company at New No. 33, Old No. 24-A, Ranjit Road, KotturpuramChennai - 600 085, not later than 48 hours before commencement of the Meeting.

............................................................. ...............................................Name of the Proxy in BLOCK LETTERS Proxy’s Signature

NEYCER INDIA LIMITEDRegd. Office : New No. 33, Old No. 24-A, Ranjith Road

Kotturpuram, Chennai - 600 085

50th Annual General MeetingFORM OF PROXY

Folio No. : No. of Shares held

I/We..........................................being a Member / Members of Neycer India Limited hereby appoint

Mr. / Mrs.........................................of..................................or failing him/her Mr./Mrs.......................

of .......................................in the district of..................................as my / our proxy to vote for me /

us on my / our behalf at the 50th Annual General Meeting of the Company to be held at 10.00 A.M.

on 29th September 2011.

Dated this .......................day of .............................2010

Signature of the Shareholder....................... ............

Note : Proxy to be valid must be deposited at the Registered Office of the Company not laterthan 48 hours before the commencement of the Meeting.

AffoxRe. 1

RevenueStamp

Book-Post

To

If undelivered, please return to:

NEYCER INDIA LIMITED33/24-A, RANJITH ROAD, KOTTURPURAMCHENNAI - 600 085.

india limited neycer india limited · sanitaryware division neycer india limited vadalur - 607 303...

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