a.  Basis of Accounting
 
 The Financial statements of the company have been prepared under the
 historical cost convention on an accrual basis, in accordance with
 applicable Accounting Standards and relevant provisions of Companies
 Act, 1956.
 
 b.  Use of Estimates
 
 The presentation of financial statements requires estimates and
 assumptions to be made that affect the reported amount of assets and
 liabilities on the date of the financial statements and the reported
 amount of revenues and expenses during the reporting period. Difference
 between the actual results and estimates are recognized in the period
 in which the results are known.
 
 c.  Fixed Assets
 
 Fixed Assets (including Capital Work in Progress) are recorded at the
 cost of acquisition or construction, net of tax credit wherever
 eligible. Cost includes all expenses related to acquisition or
 construction, including attributable borrowing cost on qualifying
 assets.
 
 d.  Expenditure during Construction Period
 
 In case of new projects and in case of substantial modernization /
 expansion at existing units of the company, all pre-operative
 expenditure specifically for the project, incurred up to the date of
 completion, is capitalized and added pro-rata to the cost of fixed
 assets.
 
 e.  Depreciation
 
 i Depreciation on Fixed Assets is provided on Straight Line Method at
 the rates and in the manner specified in Schedule XIV to the Companies
 Act, 1956.
 
 ii Depreciation on addition to the Fixed Asset or on sale/discardment
 is calculated pro rata from the date of such addition or up to the date
 of such sale/discardment, as the case may be;
 
 iii Cost of Leasehold land is not amortised and is shown at cost.
 
 iv The charge over and above the depreciation calculated on the
 original cost of the revalued assets is transferred from Revaluation
 Reserve to Depreciation Account (Profit & Loss Account)
 
 f.  Intangible Assets
 
 Intangible Assets are stated at cost of acquisition less amortization.
 Goodwill is amortised at ten percent on Straight Line Method.
 
 g.  Investments
 
 i Investment are classified as investments in Subsidiaries (valued at
 cost), Associates (valued at cost) within the meaning of Accounting
 Standard 13 Accounting for Investments
 
 ii Investments are recorded as Long Term Investments unless they are
 expected to be sold within one year.
 
 iii Investments are stated at cost in accordance with Accounting
 Standard 13 on Accounting for Investments Provision for diminution is
 made to recognize a decline, other than temporary, in the value of such
 investments.  & Accounting Standard 23 on Investment in Associates
 
 h.  Inventories
 
 i Inventories of Raw Material, Work in Progress, Finished Goods
 (including Goods for Trade) are valued ''at cost or net realizable
 value'' whichever is lower. Scrap is valued at net realizable value as
 per the assessment of the Management.  .
 
 ii Major Consumables (Stores & Spares) like LDO, lead, dies etc are
 valued at cost and other minor Consumables (Stores & Spares) are
 written off in the year of purchase.
 
 iii Cost comprises all cost of purchase, appropriate direct production
 overheads and other costs incurred in bringing the inventories to their
 present location and condition. For the purpose of valuation of closing
 stock, FIFO method is being used as prescribed by Accounting Standard
 2.
 
 i.  Revenue Recognition
 
 i Sale of goods is recognized on transfer of significant risks and
 rewards of ownership which is generally on the dispatch of goods. Gross
 sales are inclusive of excise duty, service tax, value added tax, but
 are net of sales returns.
 
 iii Income from Services is recognized when on completion of services
 or part completion of the assignment as per Contract.
 
 iii Revenue / Income and Cost / Expenses are generally accounted on
 accrual as they are earned or accrued or incurred, except in case of
 significant uncertainties.
 
 iv Dividend income is recognized when the right to receive the same is
 established.
 
 j.  Borrowing Costs
 
 Borrowing costs attributable to the acquisition or construction of
 qualifying assets, as defined in Accounting Standard 16 on Borrowing
 Costs are capitalized as part of such assets up to the date when. the
 asset is ready for its intended use. Other borrowing costs are expensed
 as incurred.
 
 k.  Employees Benefit
 
 Post Employment / Retirement Benefits - The liability for Gratuity
 benefits, on the basis of amounts contributed to LIC''s Group Gratuity
 Policy and the difference between the amounts paid on retirement and
 recovered from LIC, is charged to Profit & Loss Account. Employer''s
 Contribution to Provident Fund is debited to Profit & Loss Account.
 
 I.  Foreign Currency Transactions
 
 i.  Foreign currency transactions are recorded at the rates of exchange
 prevailing on the date of the transactions.
 
 ii. Monetary Foreign Currency assets and liabilities (monetary items)
 are reported at the exchange rate prevailing on the balance sheet date.
 
 iii. Exchange difference relating to long term monetary items, arising
 during the year, in so far as they relate to the acquisition of
 depreciable capital assets are added to / deducted from the cost of the
 asset and depreciated over the balance life of the asset.
 
 iv.  All other exchange difference are dealt with in profit and loss
 account.
 
 m.  Provision for current tax and deferred tax
 
 i Provision for income tax is made on the basis of estimated taxable
 income. Advance Tax and Tax Deducted at Source (TDS) are shown in the
 balance sheet under head Loans and advances during the year and in
 subsequent years the Advance Tax & TDS are adjusted against Provision
 for Tax. The net effect has shown under Provision for Tax.
 
 ii The deferred tax assets and deferred tax liabilities is calculated
 by applying tax rate and tax laws that have been enacted or
 substantively enacted by the balance sheet date.
 
 n.  Earnings Per Share
 
 The Company reports basic and diluted Earnings per share (EPS) in
 accordance with Accounting Standard 20 on Earnings per Share Basic
 EPS is computed by dividing the net profit or loss for the year
 attributable to equity shareholders by the weighted average number of
 equity shares outstanding during the year. Diluted EPS is computed by
 dividing the net profit or loss for the year attributable to equity
 shareholders by the weighted average number of equity shares
 outstanding during the year as adjusted for the effects of all dilutive
 potential equity shares , except where the results are anti-dilutive.
 
 o.  Cash Flow Statement
 
 The cash flow statement is prepared by the indirect method set out in
 Accounting Standard 3 on Cash Flow Statement and presents the cash
 flows by operating, investing and financing activities of the company.
 
 Cash and Cash equivalents presented in the Cash Flow Statement consist
 of cash on hand and cash at bank.
 
 p.  Issue Expenses
 
 The expenses incurred for Initial Public Offer IPO is not written off
 and same has been shown as IPO expenses under the head Miscellaneous
 Expenses. The IPO Expenses will be written of after the completion of
 the project, as per Accounting Standard 26 Intangible Assets