The Directors have pleasure in presenting the Annual Report alongwith
 Audited Statement of Act counts for the year ended 31st December, 1998.
 
 FINANCIAL RESULTS                                        (Rs. in lakhs)
                                               Year       Fifteen months
                                              Ended         Period Ended
                                           31.12.98             31.12.97
 
 Profit Before Interest & Depreciation      (62.81)              (41.49)
 
 Interest                                    318.44               402.75
 
 Depredation                                 160.31               219.77
 
 Profit / (Loss) Before Taxation           (541.56)             (664.01)
 
 Expenses Related to previous year             2.71                 --
 
 Profit / (Loss) After Taxation            (544.27)             (664.01)
 
 Balance brought forward
 from previous year                       (1152.30)             (488.29)
 
 Balance Carried to Balance Sheet         (1698.57)            (1152.30)
 
 CURRENT OPERATION AND FUTURE OUTLOOK
 
 During the period under review most of the loss sustained by the
 company are on account of interest and depredation which couldn't be
 recovered due to adverse market condition.  Further, working result of
 the company was fueled due to persistent labour unrest in the factory
 which has resulted in bottom line adversely.  However management has
 resolved the problem and are hopeful about commencement of regular
 production in November 99.
 
 PROJECT IMPLEMENTATION
 
 The Granite Phase II is near completion and is likely to be commenced
 in November 99.
 
 DIRECTORS
 
 Mr. N. K. P. Varma and Mr. A. Pathak retire by rotation at this meeting
 and are eligible for re-appointment.
 
 AUDITORS
 
 The Auditors, M/s. P. K. Himmatsinghka & Co., Chartered Accountant,
 retire at the conclusion of the ensuing Annual General Meeting and
 being eligible have expressed their willingness to be reappointed.
 
 CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
 EARNINGS AND OUTGO
 
 The Statement pursuant to Section 217(1) (e) of the Companies Act,
 1956, read with the Companies (Disclosure of Particulars in the Report
 of the Board of Directors) Rules, 1988 is given in the Annexure forming
 part of this report.
 
 PERSONNEL
 
 No employee of the Company is covered Under Section 217(2A) of the
 Companies Act, 1956 read with Companies (Particulars of Employees)
 Rules, 1975.
 
 A. CONSERVATION OF ENERGY :
 
 a) Energy Conservation measures taken :
 
 The Company Continues to make every effort to Conserve energy by
 constant monitoring of production process.
 
 b) Additional Investments & proposals, if any being implemented for
 reduction of consumption of Energy
 
 Nil
      
 c) Impact of the measures of (a) & (b) above for reduction of energy
 consumption & consequent impact on the cost of production of goods
 
 Not Applicable
 
 B. TECHNOLOGY ABSORPTION :
 
 I. Research & Development (R & D)
 
 1. Specific areas in which R & D carried Out by the Company.
 
 Nil
 
 2. Benefits derived as a result of the above R & D.
 
 Not Applicable
      
 3. Future plan of action
 
 Plan is under consideration and detailed plan will be taken up after
 commencement of Commercial Production of Phase II of 100% EDU Granite
 Project.
 
 4. Expenditure on R&D :
 
 Nil
 
 II. Technology Absorption, Adaption & Innovation.
 
 1. Efforts, in brief, made towards Technology Absorption, Adaptation.
 
 Technology absorption will be taken place on a continuous basis after
 the commencement of commercial production of Phase II of 100% EOU
 Granite Project.
 
 2. Benefits derived as a result of the above efforts.
 
 Not Applicable
           
 C. FOREIGN EXCHANGE EARNINGS AND OUTGO
 
 Nil