The Directors have pleasure in presenting the 26th Annual Report and
 Audited Statement of Accounts for the year ended 31st March 2008.
 
 FINANCIAL HIGHLIGHTS:
 
                                                           (Rs. in lacs)
 
                                                   2007-2008   2006-2007
 
 Sales and other Income                               137.63    204.12
 Add Extraordinary Exceptional Item                   696.23      0.00
 Profit/(loss): before provision of
 Depreciation & Tax                                   646.91  (1064.20)
 Less/(add): Provision for Depreciation               (20.04)   (22.56)
 Profit/(loss) before tax                             626.87  (1086.76)
 Less/(add): Tax adjustment                             1.25      0.74
 Less/(add): Provision for Doubtful
 Debts/advances                                         0.00    (11.95)
 Profit/(loss) after tax                              625.62  (1097.97)
 
 OPERATIONS:
 
 The year under review resulted in the net profit of Rs.  625.62 lacs,
 after taking the relief from OTS amounting to Rs. 696.23 lacs as
 compared to net loss of Rs. 1097.97 lacs during the previous year. As
 was in earlier years, the manufacturing operations at Jalgaon unit were
 remained suspended and the weaving units were in operation mainly on
 job work basis due to shortage of working capital.
 
 DIVIDEND
 
 In view of losses, the Board is not recommending any dividend for the
 year ended 31st March 2008.
 
 DIRECTORS
 
 In accordance with the provisions of the Companies Act, 1956 and the
 Articles of Association of the Company Shri Pradeep Poddar retires by
 rotation and being eligible offer himself for re-appointment.
 
 INSURANCE
 
 Due to continuous financial difficulties, no assets of the company have
 been insured against the fire and other risks.
 
 LISTING
 
 The equity shares of the company are listed on Mumbai, Delhi, Kolkatta,
 Chennai and Ahemdabad Stock Exchanges. The annual listing fees have
 been paid till (a) 1997-98 for Kolkatta, Chennai and Ahemdabad Stock
 Exchanges (b) 1998-99 for Dehli Stock Exchange and (c) 2000-2001 for
 Mumbai Stock Exchange.
 
 FIXED DEPOSITS
 
 The company has accepted a deposit from a firm in which relatives of
 the directors are partner to settle the OTS amount of secured creditors
 however technically it is in contravention of provisions of section 58A
 of the Companies Act 1956.
 
 DIRECTORS RESPONSIBILITY STATEMENT
 
 Pursuant to Section 217 (2AA) of the Companies Act, 1956 with respect
 to Directors responsibility statement, it is hereby confirmed:
 
 i) That the preparation of accounts for the financial year ended 31st
 March 2008, the applicable accounting standards have been followed
 along with proper explanation relating to material departures.
 
 ii) The Directors have selected such accounting policies and applied
 them consistently and made judgements and estimates that were
 reasonable and prudent so as to give true and fair view of the state of
 affairs of the company at the end of the financial year and the profit
 or loss of the company for the year under review.
 
 iii) That the Directors have taken proper and sufficient care for the
 maintenance of adequate accounting records in accordance with the
 provisions of the Companies Act, 1956 for safeguarding the assets of
 the company and for preventing and detecting fraud and other
 irregularities.
 
 iv) That the Directors have prepared the accounts for the financial
 year ended 31st March 2008 on a going concern basis.
 
 PROVISION OF SICA, 1985:
 
 As reported in last year, in the hearing before BIFR on 6th October
 2004, direction were given to forward copies of orders / proceedings to
 the concerned High Court for further necessary action for winding up
 the company.  The Honourable High Court, Mumbai issued notification to
 official liquidator for appointing him as provisional liquidator and
 the hearing before the liquidator is in process. The company, in view
 of OTS with secured creditors, is in the process of filing an appeal
 before the honourable High Court, Mumbai to give permission for sale of
 its fixed assets to clear the dues payable under OTS.
 
 ACCUMULATED LIABILITIES
 
 In respect of liabilities provided in the audited accounts further to
 add that pursuance to the heavy losses, the company suspended its yam
 manufacturing Works / functioning in its units / factories long back
 and in lieu of no improvement in the textile market but reactant slack
 down, it has closed down yarn manufacturing units / factories long back
 and approached to BIFR in the year 2000-2001 and subsequently BIFR
 declared the company sick industrial undertaking.
 
 Therefore it is pertinent to say that the liabilities of the company
 towards all financial institution / banks, of its principles amounts,
 interest and compound interest along with rate inconceivable /
 untenable and can not be taken as the admitted liabilities but under
 scanner / scrutinisation / arbitrated / prima-facie and subject for the
 verdict of an appropriate Court of Law as per provision i.e. the
 liabilities stand as disputed / integrated.
 
 CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
 EARNINGS AND OUTGO:
 
 Information pursuant to section 217(i) (e) of the Companies Act, 1956,
 read with the Companies (Disclosure of particulars in the Report of
 Board of Directors) Rules 1988 is given here below: -
 
 A. CONSERVATION OF ENERGY
 
 As in the past, the company continues its efforts to improve methods of
 energy conservation and utilisation.
 
 B.  TECHNOLOGY ABSORPTION:
 
 The Company is doing research and development for improvement in shades
 of yarns and fabrics as routine activities.
 
 C. FOREIGN EXCHANGE EARNING AND OUTGO:
 
 There is no foreign exchange earning during the year and foreign
 exchange outgo is Rs. Nil (Rs.  Nil).
 
 PARTICULARS OF EMPLOYEES :
 
 Particulars of employees under section 217(2A) of the Companies Act,
 1956 read with the Companies (Particulars of Employees) Rule 1975 are
 not attached with this report as no employee comes under the purview of
 these provisions.
 
 AUDITORS:
 
 M/s. R. S. Agrawal & Associates, Chartered Accountants, the Auditors of
 the Company are retiring at the forthcoming Annual General Meeting. The
 members are requested to appoint the auditors.
 
 AUDITORS REPORT:
 
 The Auditors report is self-explanatory and hence do not require any
 clarification.
 
 APPRECIATION:
 
 The Board of Directors place on record their appreciation for the
 support and co-operation received from the Government, Bankers, IDBI,
 SICOM, Dealers, Suppliers, Employees and you the shareholders.
 
                                          For and on behalf of the Board
                                          For ADHUNIK SYNTHETICS LIMITED
 
                                                       Radheshyam Poddar
                                                                Chairman
 Mumbai, 11th August 2008