Ambuja Cements was set up in 1986. In the last decade the company has grown tenfold.

The total
cement capacity of the company is 18.5 million tonnes.

Its plants are some of the most efficient in the world. With environment protection measures that are on par
with the finest in the developed world.

The company's most distinctive attribute, however, is its approach to the business. Ambuja follows a
unique homegrown philosophy of giving people the authority to set their own targets, and the freedom to
achieve their goals. This simple vision has created an environment where there are no limits to excellence,
no limits to efficiency. And has proved to be a powerful engine of growth for the company.

As a result, Ambuja is the most profitable cement company in India, and one of the lowest cost producer of
cement in the world.

1982

- The Company was incorporated on 17th June, and the Certificate of

Commencement of Business was obtained on 11th February, 1983. It
was
promoted by Modi Industrial House and Madhya Pradesh Audyogik Vikas
Nigam Ltd (MPAVN). The Company manufactures cement.

- The Company had under taken to set up a project to manufacture

Portland Cement in Madhya Pradesh. The main plant and machinery was
obtained from Polysius Ltd U K and their Indian associates Buckau
Wolf
India Ltd.

- The Company entered into a foreign collaboration agreement with

Blue
Circle Industries PC., U.K. (BCI) for technical consultancy
services.

1986

- 7 shares subscribed for by the signatories to the Memorandum of

Association. 334,99,993 shares then issued at par out of which
208,99,993 shares to promoters, directors, etc. (including 10,00,000
shares to NRIs on repatriation basis) and 15,00,000 shares to MPAVN
were reserved and allotted.

- Out of the remaining 111,00,000 shares, the following shares were

reserved for preferential allotment:

- (i) 25,00,000 shares to NRIs on repatriation basis (all were taken

up);

- (ii) 16,75,000 shares to employees of the company (including

Indian
working directors and employees of Modi Group Companies) and

- (iii) 2,22,000 shares to business associates of the company.

- Out of (ii) and (iii) above, only 1,93,450 shares were taken up.
The
balance 67,03,000 shares, along with 17,03,550 shares not taken up
by
employees and business associates, were offered for public
subscription
during January-February. 83,75,000 additional shares were allotted
to
retain oversubscription (4,86,950 shares to NRIs and 78,88,050
shares
to the public).

1987

- 25,00,000 shares issued at par as rights to Indian resident

shareholders in prop. 1:15. Only 22,74,291 shares taken up.

1988

- The balance 2,25,709 shares out of the rights issue of 1987-88

allotted privately.

1989

- The Company came under the provisions of the Sick Industrial

Companies (Sp. Provisions) Act, 1985 and a reference was made to the
Board for Industrial and Financial Reconstruction (BIFR).

1990

- Forfeiture on 56,600 shares annulled.

1991

- The Company's plan to expand the capacity from 11.5 lakh tonnes to
18
lakh tonnes.

- Subject to necessary approvals being obtained, the company

proposed
to issue 458,00,920 rights equity shares of Rs. 10 each at a premium
not exceeding of Rs. 2 per share in the proportion 1:1.

- In addition to the above rights issue, 5% of the rights issue at a

premium not exceeding Rs. 2 per share was to be offered to the
employees, etc., of the Company and promoter companies on an
equitable
basis.

- Issued 31,10,000 shares at par as rights in prop. 7:100 (all were

taken up) and 1,55,500 shares at par to employees (only 1,900 shares
taken up) in January.

1993

- 1,000 right shares kept in abeyance were issued.

1994
- Production declined to 10,31,219 tonnes due to excessive rains and
floods which inundated the factory and limestome mines. The company
suffered losses due to lower sales realisation and increase in
interest
liability.

1997

- The Scheme for rehabilitation was sanctioned by BIFR. Gujarat

Ambuja
Cements Ltd. was inducted as Co-promoter for revival of the company,
the Board has reconstituted and the new management assumed charge in
December.

- The name of the Company has been change from Modi Cements Ltd. to
Ambuja Cement Eastern Ltd.

- 45,801,930 No. of equity shares of Rs.10 each has been reduced by

75%
to 11,450,483 No. of equity shares of Rs. 10 each persuant to the
rehabilitation scheme santioned by BIFR on 5th November; 116,000,000
No. of equity shares of Rs. 10 each fully paid up and 50,00,000 No.
of
equity shares of Rs. 10 each Rs. 750 called and paid up allotted to
Gujarat Ambuja Cements Ltd. pursuants to rehabilitation scheme
sanctioned by BIFR on 5th November.

1998

- Modi Cements Ltd. is being merged with Gujarat Ambuja Cements

(GACL),
which holds a 93 per cent stake in the ailing company.

1999

- AMBUJA Cement Eastern Ltd. (ACEL), in its transition from the

erstwhile Modi Cement Ltd during its first full financial year, had
to
contend with more than establishing the `Ambuja Cement' brand in a
market that was familiar with the Ambuja name but not the product.

2000

- The Company hold 166057827 equity shares of Rs. 10/- each in the
company representing 93.58% of its share capital.

- Ambuja Cement Eastern Ltd. will make a preferential issue of

equity shares/any other security convertible into equity shares not
exceeding
1,70,00,000 No. of equity shares of Rs 10 each to holding company,
Ambuja Cement India Ltd.

2002

-Gujarat Ambuja loses its image as the lowest cost producer in the
market
due to acquisition.
 2003

-Members approve for the delisting of the equity shares of the

company from
Delhi and MP stock Exchanges.

-Ambuja Cement awards equipment order for BHEL

2004

-Ambuja Cement Eastern shares delisted from Bhubaneswar Stock Exchange

& Delhi Stock Exchange

-Ambuja Cements (Eastern) Ltd has succeeded in coming out of the

Board for Industrial and Financial Reconstruction (BIFR) fold.

-Ambuja Cement Eastern Ltd has informed that at the review meeting of
the BIFR held on March 3, 2004, the BIFR have passed an order,
discharging the company from purview of the Sick Industrial Companies
(Special Provisions) Act, 1985.

Ambuja Cements Limited was earlier known as Gujarat Ambuja Cements Limited
(GACL). The company was set up in 1986. In this short span Ambuja Cements has
achieved massive growth and presently, the total cement capacity of the company is 16
million tonnes. The company has three subsidiaries, viz, Ambuja Cement Rajasthan
Limited (ACRL), Ambuja Cement Eastern Limited (ACEL) and Ambuja Cement India
Limited (ACIL). Ambuja also has a strategic investment in ACC through its subsidiary
(ACIL).

Ambuja Cements is the most profitable cement company in India, and the lowest cost
producer of cement in the world. One of the major reasons that Ambuja Cements is the
lowest cost producer of cement in the world is its emphasis on efficiency. Power consists
over 40% of the production cost of cement. The company improved efficiency of its kilns
to get more output for less power. Thereafter Ambuja Cements set up a captive power
plant at a substantially lower cost than the national grid. The company sourced a cheaper
and higher quality coal from South Africa, and a better furnace oil from the Middle East.
As a result, today, the company is in a position to sell its excess power to the local state
government.

Ambuja cement is the first company to introduce the concept of bulk cement movement
by sea in India. This resulted in speedier transportation and brought many coastal markets
within easy reach. Ambuja Cements has a port terminal at Muldwarka, Gujarat. It is an all
weather port that handles ships with 40,000 DWT. The port has a fleet of seven ships
with a capacity of 20500 DWT to ferry bulk cement to the packaging units. The company
has bulk cement terminals at Surat, Panvel, and Galle. The Surat terminal has a storage
capacity of 15,000 tonnes and Panvel terminal has a storage capacity of 17,500 tonnes.
Both the terminals have bulk cement unloading facility. The port at Galle, 120 km from
Colombo, Sri Lanka, handles million tonnes of cement annually.

Major Achievements of Ambuja Cement

• Most profitable cement company in India.

• Lowest cost producer of cement in the world.

• Its environment protection measures are at par with the best in the world. The
pollution levels at all its cement plants are lower than the rigorous Swiss
standards of 100 mg/NM3.

• The only cement company to be awarded with the National Quality Award.

• First cement company to first to receive the ISO 9002 quality certification.

• Received ISO 14000 Certification for environmental systems.

• India's largest exporter of cement.

• Received Best Award for highest exports by CAPEXIL.

• First company to introduce the concept of bulk cement movement by sea in India.

company profile
Registered Office & Factory : Ambuja Nagar P O Taluka-Kodinar Junagadh
District Gujarat - 362715 Tel: 245161 Business Group: Ambuja Group Industry
Type: Cement - Major Key Officials:
Dr. Omkar Goswami Director
Mr. Paul Hugentobler Director
Mr. Nirmalya Kumar Director
Mr. Suresh Neotia Chairman / Chair Person
Mr. A L Kapur Managing Director
Mr. Shailesh Haribhakti Director
Mr. P B Kulkarni Whole Time Director
Mr. Naresh Chandra Ind.& Non Exe.Director
Mr. B L Taparia Whole Time Director
Mr. N S Sekhsaria Vice Chairman
Mr. M L Bhakta Director
Mr. N P Ghuwalewala Whole Time Director
Mr. Nasser Munjee Director
Mr. Rajendra P Chitale Director
Mr. Markus Akermann Director
Public Issue Date: Not Available BSE CODE: 500425 NSE CODE:
AMBUJACEMEQ Face Value: 2 Market Lot: 1 ISIN: INE079A01024 Current PE:
6.0074 Current Market Capital: 10627.6052 Promoters %: 46.4693 Promoters
Shares: 707436626 Institution Investment %: 37.5643 Institution Investment
Shares: 571870035 Auditor:
S R Batliboi & Associates

Banker:
Bank of America
Bank of Baroda
Central Bank of India
Citibank NA.
Hongkong & Shanghai Banking Corporation Ltd.
Punjab National Bank
Standard Chartered Bank
State Bank of India
ICICI Bank Ltd.
Canara Bank
HDFC Bank Ltd.
IDBI Bank Ltd.
Not Reported
American Express Bank
Canara Bank
Citibank NA.
Corporation Bank
Indian Overseas Bank
Punjab National Bank
Societe Generale Bank
State Bank of India
State Bank of Patiala
ICICI Bank Ltd.
HDFC Bank Ltd.
Indusind Bank Ltd.
Indian Overseas Bank
State Bank of India
State Bank of Indore
HDFC Bank Ltd.
State Bank of Patiala
Centurion Bank of Punjab
Standard Chartered Bank
ICICI Bank Ltd.
U C O Bank
Bank of India
United Bank Of India
Bank of Baroda
State Bank of India
Indian Overseas Bank
Allahabad Bank
Canara Bank
Mizuho Corporate Bank Ltd
State Bank of India
Union Bank of India
ICICI Bank Ltd.
HDFC Bank Ltd.
Bank of America
Bank of Baroda
Bank of India
Bank of Maharashtra
Central Bank of India
Citibank NA.
Corporation Bank
Deutsche Bank AG
Hongkong & Shanghai Banking Corporation Ltd.
Standard Chartered Bank
State Bank of India
Indian Overseas Bank
Indian Bank
Bank of Baroda
Bank of America
Bank of Baroda
Bank of India
Canara Bank
Central Bank of India
Standard Chartered Bank
State Bank of India
Union Bank of India
HDFC Bank Ltd.
Kotak Mahindra Bank
Hongkong & Shanghai Banking Corporation Ltd.
State Bank of India
IDBI Bank Ltd.
Punjab National Bank
Corporation Bank
IDBI Bank Ltd.
ABN Amro Bank N.V.
Bank of America
Bank of Nova Scotia
Canara Bank
Citibank NA.
Hongkong & Shanghai Banking Corporation Ltd.
Punjab National Bank

Registrar:
Satam Estate 3rd FloorCardinal Gracious RoadAbove
Bank Of BarodaChakala Andheri (E)Mumbai 400099
Sharepro Services Ltd.
Maharashtra 28215168 28329828 28215991 28347719
28348218

Company History: 1981

- The Company was Incorporated on 20th October as Ambuja Cements Pvt.Ltd.
It was jointly promoted by Gujarat Industrial InvestmentCorporation Ltd. (GIIC)
and N.S. Sekhsaria and his associates Vinod K.Neotia and Suresh Mulani for
setting up a cement project in the jointsector. The Company was converted into a
public limited company on19th March 1983 and its name was changed to Gujarat
Ambuja Cements Ltd. on 19th May 1983.
- The Company's object is to manufacture cement.
- The Company adopted the latest dry process precalcination
technologyincorporating five stage preheater for the main pyro processing
systemof the cement plant. For grinding the raw material the Companyundertook
to instal the latest air swept roller mills of polysiusdesign which were extremely
energy efficient.
- A computerised process control system with field instruments suppliedby
Larsen & Tourbo was also being installed to give consistently highquality cement
with maximum productivity.
- In addition electronic packing machines were being obtained fromHaver &
Boecker West Germany and reverse air baghouse equipment fromZurn
Industries USA.
- The company entered into an agreement with Krupp Polysius AG (KP)West
Germany for supply of plant equipment and service for theproject KP agreed to
supply raw material and coal grinding verticalroller mills homogenising and kiln
feed burning cooling and coalfiring equipment and pneumatic transport pumps.
- KP have a collaboration agreement with Buckau Wolf India Ltd. whoare
supplying the balance items of the main plant as per KP design.The scope of the
agreement with KP provides for complete engineering ofthe plant technical
documentation and information and supervision oferection and commissioning of
the project.
1983
- All shares subscribed for by signatories to the Memorandum ofAssociation
promoters etc.
1985
- A letter of intent was received to increase the installed capacityfrom 7 00 000
tonnes to 14 00 000 tonnes per annum.
- 146 44 500 No. of equity shares issued at par out of which thefollowing shares
were reserved for firm allotment: 38 24 448 shares toGIIC; 21 20 000 shares to
overseas companies of non-resident Indianpromoters on repatriation basis and
15 50 052 shares to N.S. Sekhsaria Vinod K. Neotia and their associates.
- Out of the balance 71 50 000 shares 28 60 000 shares to non-residentIndians
with repatriation rights and 8 75 500 shares to employees(including Indian
working directors)/workers and business associates ofthe Company were
reserved for preferential allotment. The remaining34 14 500 shares were offered
for public subscription during November.Out of the oversubscription 33 50 000
shares were retained andallotted to the public.
1986
- 20 00 000 No. of equity shares issued at par of which 2 00 000 sharesallotted to
private promoters and their associates and the balance of18 00 000 shares
offered and allotted to the equity shareholders asrights in prop. 1:1.
1988
- Production declined marginally to 8 02 301 tonnes due to heavy rainsin July-
August 1989 coupled with flash floods on 16th July.
1989
- The 12.6 MW diesel generating sets which were imported during 1988-89were
commissioned during the year.
1990
- Necessary approvals were received for setting up another cement plantwith 1
million tonne capacity per annum at village Suli Tehsil Arki District Solan of
Himachal Pradesh.
1991
- In order to meet long-term working capital requirements the Companyissued 10
00 000 - 17.5% secured redeemable non-convertible debentureson private
placement basis. These debentures would be redeemed inthree equal annual
instalments commencing at the end of the 6th yearfrom the date of issue of the
debentures at a prem. of 5% of the facevalue of the debentures.
- In order to part finance its expansion projects the Company proposedto issue
52 62 500 No. of equity shares of Rs.10 each at a prem. ofRs.190 per share. Out
of the total issue 50 00 000 shares were to beoffered to the existing equity
shareholders of the Company as rights inthe prop. of 1:4 and the balance of 2 62
500 shares were to be offeredto the employees directors and the business
associates of the company.
- In order to part finance its expansion projects the Company alsoproposed to
issue 52 62 500 - 17.5% secured redeemable non-convertibledebentures
aggregating to Rs.210.50 crores. Out of the total issue 50 00 000 debentures
were to be offered to the equity shareholders ofthe Company on rights basis in
the prop. of 1 debenture for every 4equity shares held and the balance of 2 62
500 debentures were to beoffered to the employees directors and business
associates of theCompany.
- Each non-convertible debenture would be attached with a detachablewarrant
and the holder of one such warrant would be entitled to applyfor and be allotted
one equity share of the Company at a price ofRs.300 per equity share (Rs.10
towards face value and Rs.290 as prem.).
- The warrant holders at the time of exercising their right/option tosubscribe for
their equity shares entitlement would have further optioneither to pay a price of
Rs.300 per share of the Company or tosurrender the equivalent number of
debentures as subscription forallotment of equity shares.
- GACL Finance Ltd. Concrete Investments Ltd. and Indo NipponSpecial
Cements Ltd. are the subsidiaries of the company.
1992
- The Company undertook bulk cement transportation by sea to themajor
markets of Mumbai Surat and other deficit zones on the WestCoast.
Transportation was to be carried out by three speciallydesigned ships. The units
bulk terminal at Kodinar and one at NewMumbai was completed and work on the
third terminal near Surat began.
1993
- 51 60 165 rights equity shares allotted at a prem. of Rs.190 pershare (49 66
815 shares prop. 1:4; 90 850 shares to employees and1 02 500 shares to
Associates); 1 10 281 shares of Rs.10 each allottedat a prem. of Rs.215 per
share on exercise of warrants by warrantholders.
1994
- The Company's muller location 1.5 million tonne cement project
withclinkeriation facility at site in H.P and grinding facility both atSuli & Ropar in
Punjab was commissioned. Land was acquired atSahranpur to serve as another
site for grinding cement.
- The Company also undertook to set up a new unit `Gajambuja Cement'with an
installed capacity of 9.4 lakh tonnes at the existingpremises. The kiln was fired
on 1st March 1993 and the unit producedits first batch of clinker on 4th March
1993.
- The Company undertook to set up the third 1 million tonne cementplant at
Ambujanagar. Orders for plant and machinery were placed andthe plant was
expected to be commissioned by December 1996. This willincrease the
company's total cement capacity to 4.5 million tonnes.
- 45 65 044 shares allotted on conversion of warrants. 12 21 994allotted on
conversion of aurobonds. 375 rights shares kept inabeyance allotted. 3 02 19
749 bonus shares issued in prop. 1:110 00 000 shares allotted to IFC
Washington. 4 404 rights shares keptin abeyance allotted.
1995
- The Company proposed to install one more cement mill at Himachalplant.
- 11 251 829 shares allotted on optional conversion of FCCBs. 7 724Rights
shares kept in abeyance allotted. 7 350 shares allotted onconversion of tradeable
warrants.
1996
- Two more ships `Ambuja Keerti' and `Ambuja Shakti' were added to theFleet.
The Company has submitted a proposal to revive Modi CementsLtd. to IDBI
during the year.
- Another 19724 No. of equity shares allotted on conversion ofwarrants.
1997
- 100 000 000-10% non-convertible redeemable pref. shares of Rs. 10each
allotted and 30 000 000-12.75% non-convertible redeemable pref.shares of Rs.
10 each redeemed.
- Gujarat Ambuja Cements Ltd's (GACL) Kodinar plant is set to
commencecommercial production with an enhanced capacity by mid-April.
- Gujarat Ambuja Cement Ltd. has offered to set up a multi-crore cementplant in
Jammu and Kashmir.
- Gujarat Ambuja Cement Ltd. (GACL) was set up in 1981 as a jointsector
company promoted by Narottam Sekhsaria and Gujarat IndustrialInvestment
Company (GIIC). Its cement plant which was commissioned in1985 was set up in
technical collaboration with Krupp Polysius Germany Bakau Wolf and Fuller
KCP.
- Gujarat Ambuja Cement Ltd. (GACL) is setting up two new units with acapacity
of 1.5 m.t. each through its subsidiaries.
- The company has signed a memorandum of understanding (MoU) with
thepromoters of Modi Cement to take control of the sick company and
hasprepared a revival proposal to be submitted to the Board for Industrialand
Financial Reconstruction (BIFR).
1998
- Gujarat Ambuja Cements to set up a $20 million clinker Grinding unitin Sri
Lanka.
1999
- Gujarat Ambuja is proposing to set up a greenfield cement plant witha six
million tonne capacity in phases in Andhra Pradesh.
- Gujarat Ambuja is setting up a 0.50 MT bulk terminal and a packagingfacility at
Tuticorin for Rs 16 crore to increase its presence in thesouth especially Tamil
Nadu.
- Maratha Cements Ltd a wholly-owned subsidiary of Gujarat AmbujaCements is
to be amalgamated with the latter.
- The company has proposed a bonus shares in the ratio of 1:1.
2000
- Cement giants Larsen & Tubro (L&T) and Gujarat Ambuja Cements
haveentered a unique agreement to reduce transportation costs indespatching
bulk cement in Gujarat.
- The Company has entered the fray for setting up a slag cement unitnear the
integrated steel complex of Jindal Vijayanagar Steel Ltd. inKarnataka.
- The Company has entered into a contract with a Soinhalese firm Mahaveli
Marine Cement to supply around 2.5 lakh tonnes of cementannually.
- Eastern Ambuja Cement a 92-per cent subsidiary of Gujarat AmbujaCement is
in talks with Orissa-based Shiva Cement for a possible jointventure.
- The Company has kickstarted its operations in Sri Lanka with thesetting up of a
cement terminal in the port of Galle in the south ofthe island country.
- Ambuja Cement Eastern a subsidiary of Gujarat Ambuja Cements ismaking a
preferential allotment of equity to its promoters to mop up Rs30 crore to part-
finance its Rs 130-crore expansion project.
- ICRA has downgraded the non-convertible debenture (NCD) programmes ofthe
company.
- Fitch India has assigned a rating of Ind AAA to the Rs 50 crore NCDprogramme
of the company.
2001
- The Company has completed the issue of FCCBs of about $100 millionissued
in the international markets.
- Gujarat Ambuja Cements Ltd. the fourth largest cement maker in thecountry
has closed its issue of secured non-convertible debenturesafter raising the
targeted Rs 200 crore.
- Gujarat Ambuja Cements Ltd is planning to issue fresh equity shareson a
prefrential basis to non-promoter groups.
- Gujarat Ambuja Cements Ltd (GACL) has received Rs 200 crore fromforeign
equity investor Warburg Pincus as part of its proposed Rs360-crore investment in
the form of equity shares and convertible ants.
- The company will buyback shares worth Rs 50 crore at a maximum shareprice
of Rs 170 per share through the open market route it said.Gujarat Ambuja
Cements has clocked a 112 per cent rise in net profit atRs 53.23 crore during the
first quarter of the financial year 2001-02.
2002
-Commercial production commences at Gujarat Ambuja Cements Maratha
Cement Works plant
-Board approves merger of Ambuja Cement Rajasthan with the company
-Mops up Rs 50 cr by issuing non Convertible Debentures (NCD)
-Allots 80 lacs warrants to Affinity Investments an Affiliate of Warburg Pincus
Equity Partners L.P
-Securities Appellate Tribunal (SAT) directs Sebi to examine Guj Ambuja deal for
ACC stake
2003
-SEBI finds no violation of Regulation 12 of the SEBI (Substantial Acquisition of
Shares and Takeovers) Regulation 1997 by Gujarat Ambuja Cements Ltd. with
regard to the ACC deal
-Raises $80 million through External Commercial Borrowings (ECB)
2004
-BIFR sanctions the rehabilitation scheme for merger of Ambuja Cement
Rajasthan with Gujarat Ambuja Cements Ltd.
-Gujarat Ambuja Cements Ltd has informed that Shri NP Ghuwalewala has been
appointed as the Wholetime Director of the Company at the Board meeting held
today on June 28 2004
2008
-Ambuja Cements Ltd has appointed Mr. Naresh Chandra as an additional
director.

auditor report

1. We have audited the attached Balance Sheet of Ambuja Cements

Limited (the Company) as at December 31, 2008 and also the Profit and
Loss Account and the Cash Flow Statement for the year ended on that
date annexed thereto. These financial statements are the responsibility
of the Companys management. Our responsibility is to express an
opinion on these financial statements based on our audit.

2. We conducted our audit in accordance with auditing standards

generally accepted in India. Those Standards require that we plan and
perform the audit to obtain reasonable assurance about whether the
financial statements are free of material misstatement. An audit
includes examining, on a test basis, evidence supporting the amounts
and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis
for our opinion.

3. As required by the Companies (Auditors Report) Order, 2003 (as

amended) issued by the Central Government of India in terms of
sub-section (4A) of Section 227 of the Companies Act, 1956, we enclose
in the Annexure a statement on the matters specified in paragraphs 4
and 5 of the said Order.

4. Further to our comments in the Annexure referred to above, we

report that:

i. We have obtained all the information and explanations, which to the

best of our knowledge and belief were necessary for the purposes of our
audit;

ii. In our opinion, proper books of account as required by law have

been kept by the Company so far as appears from our examination of
those books;

iii. The Balance Sheet, Profit and Loss Account and Cash Flow Statement
dealt with by this report are in agreement with the books of account;

iv. In our opinion, the Balance Sheet, Profit and Loss Account and Cash
Flow Statement dealt with by this report comply with the accounting
standards referred to in sub-section (3C) of Section 211 of the
Companies Act, 1956.

v. On the basis of the written representations received from the

directors, as on December 31, 2008, and taken on record by the Board of
Directors, we report that none of the directors is disqualified as on
December 31, 2008 from being appointed as a director in terms of clause
(g) of sub-section (1) of section 274 of the Companies Act, 1956.

vi. In our opinion and to the best of our information and according to
the explanations given to us, the said accounts give the information
required by the Companies Act, 1956, in the manner so required and give
a true and fair view in conformity with the accounting principles
generally accepted in India;

a) in the case of the Balance Sheet, of the state of affairs of the

Company as at December 31, 2008;

b) in the case of the Profit and Loss Account, of the profit for the
year ended on that date; and

c) in the case of Cash Flow Statement, of the cash flows for the year
ended on that date.

ANNEXURE

Referred to in paragraph 3 of our report of even date

(i) (a) The Company has maintained proper records showing full
particulars, including quantitative details and situation of fixed
assets.

(b) The Company has a programme for physical verification on a

rotational basis, which, in our opinion, is reasonable having regard to
the size of the Company and the nature of its business. Accordingly,
certain fixed assets have been physically verified by the management
during the year and no material discrepancies were identified on such
verification.

(c) During the year, there was no substantial disposal of fixed assets.

(ii) (a) The management has conducted physical verification of

inventory at reasonable intervals, other than materials lying with
third parties, which have been substantially confirmed by them.

(b) The procedures of physical verification of inventory followed by

the management are reasonable and adequate in relation to the size of
the Company and the nature of its business.

(c) The Company has maintained proper records of inventory and no

material discrepancies were noticed on physical verification as
compared to book records.

(iii) (a) The Company has not granted any loans, secured or unsecured
to companies, firms or other parties covered in the register maintained
under section 301 of the Companies Act, 1956. (b) The Company has not
taken any loans, secured or unsecured from companies, firms or other
parties covered in the register maintained under section 301 of the
Companies Act, 1956. (iv) In our opinion and according to the
information and explanations given to us, there is an adequate internal
control system commensurate with the size of the Company and the nature
of its business, for the purchase of inventory and fixed assets and for
the sale of goods and services. During the course of our audit, no
major weakness has been noticed in the internal control system in
respect of these areas. (v) (a) According to the information and
explanations provided by the management, we are of the opinion that the
particulars of contracts or arrangements referred to in section 301 of
the Act that need to be entered into the register maintained under
section 301 have been so entered. (b) In our opinion and according to
the information and explanations given to us, the transactions made in
pursuance of such contracts or arrangements exceeding value of Rupees
five lakhs have been entered into during the financial year at prices
which are reasonable having regard to the prevailing market prices at
the relevant time. (vi) The Company has not accepted any deposits from
the public to which the directives issued by the Reserve Bank of India
and the provisions of sections 58A, 58AA or any other relevant
provisions of the Act and the rules framed there under apply. (vii) In
our opinion, the Company has an internal audit system commensurate with
the size and nature of its business. (viii) We have broadly reviewed
the books of account maintained by the Company pursuant to the rules
made by the Central Government for the maintenance of cost records
under section 209(1 )(d) of the Companies Act, 1956, and are of the
opinion that prima facie, the prescribed accounts and records have been
made and maintained. We have however not made a detailed examination of
the records with a view to determine that they are accurate. (ix) (a)
The Company is regular in depositing with appropriate authorities
undisputed statutory dues including provident fund, investor education
and protection fund, employees state insurance, income-tax, sales-tax,
wealth-tax, service tax, customs duty, excise duty, cess and other
material statutory dues applicable to it.

(b) According to the information and explanations given to us, no

undisputed amounts payable in respect of provident fund, investor
education and protection fund, employees state insurance, income-tax,
wealth-tax, service tax, sales-. tax, customs duty, excise duty, cess
and other undisputed statutory dues were outstanding, at the year end,
for a period of more than six months from the date they became payable.

(c) According to the records of the Company, the disputed statutory

dues on account of provident fund, investor education and protection
fund, employees state insurance, income-tax, wealth-tax, service tax,
sales-tax, customs duty, excise; duty, cess dues outstanding on account
of any dispute, are as follows:

Name of the Nature of dues Amount**

statute (Rs. in crores)

Central Excise Demand of Excise Duty on 0.13

Act, 1944 Clearance of Cement & Others 0.68

0.11

Denial of MODVAT credit on 0.02

Inputs and Capital Goods 0.75

3.18
2.32
0.45
1.28

Denial of Service Tax Credit 0.56

3.06
0.90

Period to which Forum where dispute

the amount is pending
relates

1999-2008 CESTAT*
CESTAT
Commissioner (A)

1994-1997 Supreme Court*

1993-1996 High Court*

2002-2007 CESTAT*

2002-2007 CESTAT

1995-2008 Commissioner (A)*

1995-2008 Commissioner (A)

2005-2006 High Court

2005-2007 CESTAT
2005-2008 Commissioner (A)

Name of the Nature of dues Amount**

statute (Rs. in crores)

Central Sales Demand of Sales Tax / 3.30

Tax Act, 1956 Additional Tax / Purchase Tax 7.18
and Various State 0.89
Sales Tax Act 9.62

Custom Act, 1962 Demand of Custom Duty 0.93

0.06
0.44

State Land Demand of Land Tax 14.57

Tax Act 0.60
Environmental Cess 1.18

Chhattisgarh Energy Development Cess 4.26

Upkar
(Sanshodhan
Adhiniyam) 2004

Period to which Forum where dispute

the amount is pending
relates

1999-2006 Supreme Court

2000-2008 High Court

1991-2002 Tribunal

1991-2005 Commissioner (A)

2001-2007 CESTAT*

2000-2007 Commissioner (A)*

2000-2007 Commissioner (A)

2006-2009 High Court

2006-2008 Tax Board

2008 High Court

2006 onwards High Court

* In respect of these cases the Department is in appeal ** Net of

amount deposited (x) The Company has no accumulated losses at the end
of the financial year and it has not incurred cash losses in the
current and immediately preceding financial year.

(xi) Based on the information and explanations given by the management,

we are of the opinion that the Company has not defaulted in repayment
of dues to debenture holders. The Company has no outstanding dues in
respect of the financial institution or bank.

(xii) According to the information and explanations given to us and

based on the documents and records produced to us, the Company has not
granted loans and advances on the basis of security by way of pledge of
shares, 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 of clause
4(xiii) of the Companies (Auditors Report) Order, 2003 (as amended)
are not applicable to the Company.

(xiv) In our opinion and according to the information and explanations

given to us, the Company is not dealing in or trading in shares,
securities, debentures and other investments. The Company has invested
surplus funds in marketable securities and mutual funds. According to
the information and explanations given to us proper records have been
maintained of the transactions and contracts and timely entries have
been made therein. The marketable securities and mutual funds have been
held by the Company, in its own name.

(xv) According to the information and explanations given to us, the

Company has not given any guarantee for loans taken by others from bank
or financial institutions.

(xvi) The Company did not have any term loans outstanding during the
year. (xvii) According to the information and explanations given to us
and on an overall examination of the Balance Sheet of the Company, we
report that no funds raised on short-term basis have been used for
long-term investment.

(xviii) The Company has not made any preferential allotment of shares
to parties or companies covered in the register maintained under
section 301 of the Companies Act, 1956.

(xix) According to the information and explanations given to us, the

Company has created security on the debentures issued.

(xx) The Company has not raised any money through a public issue during
the year.

(xxi) Based upon the audit procedures performed for the purpose of
reporting the true and fair view of the financial statements and as per
the information and explanations given by the management, we report
that no fraud on or by the Company has been noticed or reported during
the course of our audit.

For S. R. BATLIBOI & ASSOCIATES

Chartered Accountants

per Sudhir Soni

 Partner
Membership No.: 41870
Mumbai
February 6, 2009