The Directors have pleasure in presenting their annual report on the
 business and operations of your Company together with the audited
 accounts of the Company for the year ended 31st March, 2011.
 
                                                      (Rs. in Crores)
 
                                31st March, 2011         31st March, 2010
 
 FINANCIAL RESULTS
 
 Gross Turnover                         2415.38                2387.07
 
 Income for the year                    2264.20                2295.24
 
 Gross Profit before interest            555.12                 843.42
 
 Interest Charge                          52.63                  26.97
 
 Profit before Depreciation 
 & Tax                                   502.49                 816.45
 
 Provision for
 
 i) Depreciation            64.84                   55.64
 
 ii) Taxation              117.78        182.62    203.63       259.27
 
 Profit after Tax                        319.87                 557.18
 
 Additions :
 
 Balance Brought Forward 
 from last year            190.90                  100.92
 
 Surplus available for 
 Appropriation                           510.77                 658.10
 
 Appropriation:
 
 i) Debenture Redemption 
 Reserve                    16.50                   13.25
 
 ii) Interim Dividend       19.25                   19.25
 
 iii) Corporate Dividend 
 Tax on Interim Dividend     3.20                    3.27
 
 iv) Proposed Final 
     Dividend               26.95                   26.95
 
 v) Corporate Dividend Tax 
 on proposed Final Dividend  4.37                    4.48
 
 vi) General Reserve       250.00        320.27    400.00       467.20
 
 Balance transferred to 
 Balance Sheet                           190.50                 190.90
 
 DIVIDEND
 
 The Company has paid an interim dividend of Rs. 2.50 per share (i.e. 25%)
 on ordinary shares during the year. Your Directors are pleased to
 recommend a final dividend of Rs. 3.50 per share (i.e.35%) on ordinary
 shares for the year ended 31st March, 2011. Thus the aggregate dividend
 for the year ended 31st March, 2011 works out to Rs. 6.00 per share (60%)
 aggregating to Rs. 53.77 crores including Corporate Dividend Tax of Rs.
 7.57 crores as compared to Rs. 53.95 crores (including Corporate Dividend
 Tax of Rs. 7.75 crores) in the previous year.
 
 HIGHLIGHTS OF PERFORMANCE/EVENTS
 
 During the year, the Company achieved its highest cement production of
 
 5.93 million tonnes including blended cement at 5.12 million tonnes.
 The Waste Heat Recovery System (WHRS) projects of 15 MW (two systems of
 7.5 MW each) at Satna and 7.5 MW at Chanderia were commissioned during
 the year. Jute Division registered its highest turnover and export of Rs.
 205.52 crores and Rs. 70.43 crores respectively. The debotrlenecking
 project undertaken at the clinker manufacturing units at Satna has been
 completed during the year. A Memorandum of Understanding with Assam
 Mineral Development Corporation (AMDC), a Government of Assam
 undertaking, has been signed to set up one-million ton greenfield
 cement plant at Umrangsu in the North Cachar Hills district, Assam
 through a Joint Venture Company.
 
 CONTRIBUTION TO NATIONAL EXCHEQUER
 
 During the year under review, a sum of Rs. 761.55 crores (Rs. 785.54 crores
 in 2009-10) was paid to the various government authorities on account
 of taxes, duties and other levies.
 
 CORPORATE GOVERNANCE
 
 The Company has complied with the Corporate Governance Code as
 stipulated under the Listing Agreement with the Stock Exchanges. A
 separate section on Corporate Governance, along with certificate from
 the auditors confirming the compliance, is annexed and forms part of
 the Annual Report.
 
 AWARDS & RECOGNITION
 
 Shri B.R. Nahar, Executive Director & Chief Executive Officer of the
 Company, has been identified by the prestigious Businessworld
 magazine as Indias Most Valuable CEO amongst the countrys mid-sized
 cement companies. The Research Team of the magazine has decided the
 ranking based on factors such as sales, profit and stock price
 performances as well as the market capitalization of the Company.
 
 Two teams from our Satna Unit namely Pratigya and Ash participated
 in the Regional Convention - Quality Circle held at Kanpur and both the
 teams won Gold Awards. After wining the Gold Award in the Regional
 Convention, team Pratigya participated in the National Convention of
 the Quality Circle Forum held at Vishakapatnam in which total 874 teams
 had participated and won the Par Excellence Award. This team has been
 recommended for participation in International Convention.
 
 CORPORATE SOCIAL RESPONSIBILITY
 
 The Company as a part of the M.R Birla Group is actively associated
 with various social and philanthropic activities undertaken by the
 Group. The Company has been playing a pro-active role in the
 socio-economic growth and has contributed to all spheres ranging from
 health, education, rural infrastructure development, environment
 conservation etc.
 
 In keeping with the M.R Birla Groups vision to serve the society, the
 Board of Directors of the Company has decided to allocate a minimum of
 10% of the distributed profit towards Corporate Social Responsibility
 (CSR) activities. The CSR activities will be undertaken by the Company
 on its own or through various charitable institutions, including those
 managed by the M.R Birla Group, which currently runs various healthcare
 and educational institutions of repute. These include M. P. Birla
 Hospital and Priyamvada Birla Cancer Research Institute at Satna,
 Bombay Hospital, Mumbai and Indore, Belle Vue Clinic and Priyamvada
 Birla Aravind Eye Hospital, Kolkata, and South Point School, M. R Birla
 Planetarium and
 
 M. R Birla Foundation Higher Secondary School, also in Kolkata, to name
 a few.
 
 With a view to provide a road map for its CSR initiatives, the Company
 has formulated the CSR Policy. The purpose of CSR Policy is to devise
 an appropriate strategy and focus its CSR initiatives and lay down the
 broad principles on the basis of which the Company will fulfill its CSR
 objectives.
 
 Amongst the new projects being undertaken by M. R Birla Group in this
 regard are Mumbai Hospital at Jaipur and M.R Birla Hospital at
 Chittorgarh.  The Company is actively associated financially and
 otherwise in the implementation of the philanthropic projects.
 
 That apart, some of the other initiatives of the Company undertaken in
 the field of conservation of environment, health-care, education and
 social welfare are as follows:
 
 A) Conservation of Environment
 
 Consistent efforts in promoting clean environment and making the
 environment eco-friendly have continued throughout the year.
 Accordingly, various initiatives have been taken for Clean Development
 Mechanism (CDM) and pollution prevention. The environmental dimension
 forms an integral part of the business decisions.
 
 At Satna, for further improving the environmental performance, various
 steps have been taken during the year such as installation of Bag House
 with Kiln, upgradation of cooler ESP for efficiency improvement by
 providing one more field, installation of new Bag House in Ball Coal
 Mill and Vertical Coal Mill for emission control. All the emitting
 electrodes in the Kiln ESP were replaced to arrest its snapping and to
 ensure 100% field availability.
 
 At Chanderia, water tankers, pumps and rain guns have been provided for
 pressurized spray in order to control dust pollution around mining area
 and roads. Measures have been taken for conservation of Limestone
 reserves. It is proposed to install beneficiation plant in the
 Financial Year 2011-12 for optimizing the extraction of limestone. It
 is taking various measures for harvesting and conservation of water.
 
 On implementation of the Waste Heat Recovery System at Satna and
 Chanderia plants the Company uses the waste hot gases coming out of the
 pre-heater and clinker cooler to generate substantial power thereby
 reducing Green House Gases (GHG) emissions into the atmosphere.
 Further, to protect the environment, the Company has consumed 1.15
 million tonnes of Fly ash during the year 2010-11 at various cement
 plants of the Company. This has resulted in reduction of clinker usage,
 which in turn reduced GHG emissions at our plants, without compromising
 on the quality and strength of cement
 
 Extensive plantations and gardening have been undertaken at Satna.
 Raebareli and Chanderia Units both in and around mining, plant and
 residential area.
 
 B) Health Initiatives
 
 Medical camps were organized for free medical treatment and free eye
 check-up for the benefit of villagers of surrounding areas in Satna
 unit. The medical officer and para-medical staffs also visited various
 villages every week for free medical check up, treatment and providing
 medicines. The Company sponsored/supported various programmes in the
 field of Pulse Polio vaccination and other related programmes organised
 by local authorities and other agencies. At Chanderia, Family Planning
 Camp at Rawatbhata and medical camps were organized at nearby places.
 At Durgapur, 10 nos. eye screening camps were organised through MP.
 Birla Eye Clinic and 1530 eye surgeries were undertaken during the year
 free of charge.
 
 C) Education Initiatives
 
 Our Plant at Satna supported a number of schools in the nearby areas by
 undertaking various initiatives such as carrying out the required
 construction work in the schools, providing bus facility for attending
 the school in city area to the children living in the surrounding
 villages of Satna, providing free stationery and sports materials, and
 organizing sports and other social activities in the villages
 surrounding our mining areas and nearby schools. Vocational Training
 was provided to a number of students pursuing Management and
 Engineering courses at our plants as well as at Corporate Office.
 
 D) Social Welfare
 
 Drinking water is being provided by the Satna Unit in nearby villages.
 The Unit also contributed to development and maintenance of
 infrastructure for water supply in the nearby villages. The Unit
 organised sports and various other social activities and functions.
 Contributions were made towards development of historical & religious
 place. At Chanderia Unit, regular maintenance and development of
 various gardens at Chittor was undertaken. The Unit made contributions
 to various social programmes such as Governments Total Sanitation
 Campaign for Nirmal Gram Scheme for 238 families and Neera Smriti
 Sansthans Meera Mahotsav. Supply of water as a draught relief measures
 in five Panchayat Samities covering 32 villages by deployment of 92
 tankers per day was undertaken at Chanderia.
 
 SUBSIDIARY COMPANIES
 
 The Company has nine subsidiaries out of which the three subsidiaries
 namely, Thiruvaiyaru Industries Limited, Birla North East Cement
 Limited and New-Age Cement Limited are under the process of voluntary
 winding up. Therefore, the aforesaid three subsidiaries have not been
 considered in preparing the consolidated balance sheet.
 
 The statement pursuant to Section 212 of the Companies Act, 1956
 containing details of subsidiaries of the Company, relating to six
 subsidiaries.  forms part of the Annual Report.
 
 In view of the general exemption from the applicability of Section
 212(8) of the Companies Act, 1956 granted by the Ministry of Corporate
 Affairs vide its General Circular No.2/2011 dated 8th February, 2011,
 the Audited Statement of Accounts, the Reports of the Board of
 Directors and Auditors of the Subsidiary Companies are not annexed.
 Shareholders who wish to have a copy of the full report and accounts of
 the subsidiaries will be provided the same on receipt of a written
 request from them. These documents will also be available for
 inspection by any shareholder at the Registered Office of the Company
 on any working day during business hours. The consolidated Financial
 Statements presented by the Company include financial results of its
 subsidiary companies.
 
 DIRECTORS RESPONSIBILITY STATEMENT
 
 As required by Section 217(2AA) of the Companies Act, 1956, your
 Directors state that -
 
 (a) in the preparation of the annual accounts for the year ended 31st
 March, 2011, the applicable accounting standards have been followed
 with proper explanation relating to material departures, if any;
 
 (b) the accounting policies adopted in the preparation of the annual
 accounts have been applied consistently (read with notes as appearing
 in Schedule 23 on Accounting Policies and Notes on Accounts) and
 reasonable and prudent judgments and estimates have been made so as to
 give a true and fair view of the state of affairs of the Company at the
 end of the Financial Year 2010-11 and of the profit for the year ended
 31st March, 2011;
 
 (c) proper and sufficient care has been taken 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;
 
 (d) the annual accounts for the year ended 31st March, 2011, have been
 prepared on a going concern basis.
 
 ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
 EARNINGS AND OUTGO
 
 As required under Section 217(l)(e) of the Companies Act, 1956, details
 relating to Conservation of Energy, Technology Absorption and Foreign
 Exchange Earnings and Outgo are given in the Annexure, which is annexed
 hereto and forms part of the Directors Report.
 
 PARTICULARS OF EMPLOYEES
 
 As required under Section 217(2A) of the Companies Act, 1956, and the
 Rules made thereunder, particulars of the employees concerned are given
 in the Annexure, which is attached hereto and forms part of the
 Directors Report.
 
 DIRECTORS
 
 Shri Anand Bordia and Shri Pracheta Majumdar retire from the Board by
 rotation and being eligible, offer themselves for re-appointment.
 
 Shri N.K. Kejriwal, who is also retiring by rotation has not offered
 himself for re-appointment on account of ill health and accordingly
 shall cease to be a Director upon conclusion of the ensuing Annual
 General Meeting.  Shri Kejriwal has served as a Director on the Board
 of the Company for more than 44 years and the Board places on record
 its deep appreciation for the services rendered by him during his
 tenure.
 
 AUDITORS & AUDITORS REPORT
 
 The members are requested to appoint the auditors and to fix their
 remuneration.
 
 The notes on accounts referred to in the Auditors Report are
 self-explanatory and, therefore, do not call for any further comments.
 
 Shri Somnath Mukherjee, Cost Accountant, had been appointed as Cost
 Auditor relating to Cement and Jute Goods manufactured by the Company
 for the year under review in terms of the Central Governments
 approval.
 
 APPRECIATION
 
 We wish to place on record our appreciation for the continued
 assistance and co-operation extended to the Company by the Government
 of India, State Governments, Financial Institutions and Banks, Dealers
 and Customers.  Shareholders and to all others who are continuing their
 assistance to the Company.
 
 HARSH V.LODHA                 Chairman
 
 PRACHETA MAJUMDAR   
 VIKRAMSWARUP
 
 DEEPAK NAYYAR
 
 M. K. SHARMA                  
 
 B.RNAHAR                      Executive Director &
                               Chief Executive Officer
 Kolkata,
 
 Dated, the 28th day of April, 2011