Century Textiles and Industries

The take pleasure in presenting the 111th Annual Report of the Company
 along with the audited statements of Accounts for the year ended 31st
 March, 2008. The summarised financial results are given below. The
 overall profitability of the Company has increased in comparison to the
 previous year after charging all expenses, interest, payments made
 under the Voluntary Retirement Scheme (VRS) and provision for
 ex-gratia/compensation, as required under the relevant Accounting
 Standard.
 
 1.  SUMMARISED FINANCIAL RESULTS:                    (Rs. in crore)
                                            2007-08              2006-07
 
 Profit after interest, VRS payments,        566.31              497.23
 gratuity, ex-gratia / 
 compensation etc.
 Less:
 
 Depreciation                        168.58            135.19
 
 Arrears of Depreciation              26.85              8.99
 
 Prior Period Adjustments (Net)        0.81              0.51
 
 Provision for taxation 
 (including Fringe Benefit Tax)       98.24             97.79
 
 Deferred Tax Debit/(Credit)          (7.60)    286.88 (18.06)   224.42
 
 Net Profit                                     279.43           272.81
 
 Add:
 
 Balance brought forward                        110.11            77.08
 
 Available Profit dealt 
 with as under                                  389.54           349.89
 
 Transfers & Appropriations:
 
 Interim Dividend paid                             -              34.89
 
 Proposed Equity Dividend                        41.87
 
 Corporate Dividend Tax                           7.12             4.89
 
 General Reserve                                200.00           200.00
 
 Balance carried forward                        140.55           110.11
 
                                                389.54           349.89
 
 The performance of each business segment of the Company is
 comprehensively covered in the Management Discussion and Analysis
 Report based on the reports of the Wholetime Director of the Company
 and President of each of the units of the Company and forms part of
 this Directors Report.
 
 2.  DIVIDEND:
 
 The Board of Directors has recommended dividend @ 45% (forty five
 percent) on the paid up equity share capital of the Company, for the
 year ended 31.03.2008 as against 37.50% (Thirty seven and a half
 percent) paid in the previous year by way of interim dividend on equity
 shares of Rs.10/- each which was treated as final dividend for the year
 2006-07. The dividend will be paid when declared by the shareholders in
 accordance with the law. The dividend will be free of tax in the hands
 of the shareholders. However, the Company will have to pay dividend
 distribution tax @ 15% plus applicable surcharge and education cess,
 aggregating to about 17% on the dividend amount.
 
 3.  EXPORTS:
 
 The total exports of the Company amounted to Rs.292 crore (Previous
 year Rs.315 crore) which represents about 8 percent of the net sales.
 
 4.  EXPANSION & MODERNISATION: 
 
 a) Textiles
 
 The project work for setting up a new Textile Mill as a separate
 Division of the Company named as Birla Century, at GIDC Industrial
 Estate, Jhagadia, Dist. Bharuch in the State of Gujarat, is at an
 advanced stage and is expected to be commissioned by about June, 2008
 as scheduled. The mill is slated to house about three hundred looms and
 one lac spindles for a manufacturing capacity of about twenty five
 million metres of fabrics per annum. The plant will also be equipped
 with a gas based captive power plant of 30 MW.
 
 b) Cement
 
 Modification and upgradation work at all Cement units is complete and
 the cement manufacturing capacity has increased to 7.80 million tonnes
 per annum, with effect from 1st March, 2008. Subsequent to our report
 in the previous year, our proposal for cement capacity expansion is
 modified to expand the cement manufacturing capacity from 7.80 million
 tonnes per annum to 11.80 million tonnes per annum. This is expected to
 be achieved by setting up a new clinker line of the capacity of 2.50
 million tonnes and an equivalent cement grinding facility, adjacent to
 the existing plant of Manikgarh Cement at Gadchandur, Maharashtra,
 along with a captive Thermal Power Plant of 40 MWand as planned
 earlier, the 1.50 million tonnes per annum cement grinding unit at
 Sagardighi in Dist. Murshidabad, West Bengal. The revised total outlay
 for the aforesaid expansion is estimated to be about Rs.1800crore.
 
 Environment clearance from Ministry of Environment and Forests, New
 Delhi, has been received for expansion of Cement Manufacturing Capacity
 at Gadchandur, Maharashtra. The clearance for Forest Land admeasuring
 7.06 hectare for pipe/belt conveyor system is yet to be received from
 Ministry of Environment and Forests, New Delhi.
 
 We intend to place orders for major equipments for expansion at
 Gadchandur, Maharashtra after getting clearance for forest land.
 
 As regards setting up a grinding unit at Sagardighi, District
 Murshidabad, West Bengal, we have taken possession of 159 acres of
 requisite land. The Environment Clearance for the Grinding Unit is
 expected shortly from the Pollution Control Board, West Bengal.
 
 We plan to place orders for major equipments for the Grinding Unit at
 Sagardighi, West Bengal after getting the environment clearance as
 mentioned above.
 
 The expansion is expected to be operational within 3 years from the
 placement of orders for the Plant and Machinery.
 
 c) Pulp and Paper
 
 Prime GradeTissue Paper Plant
 
 Orders for major machineries have been placed. Civil construction of
 buildings for plant and godowns is in progress.  The project is running
 on schedule and is expected to be operational by about November, 2008.
 Total cost of the project is expected to be around Rs.175 crore.
 
 Multi-layer Packaging Board Plant
 
 To diversify further and to cater to the growing Packaging Paper Board
 demand, it has been decided to set up a 500 tonnes per day Multi-layer
 Packaging Board Plant and a 40 MW Power generation plant with an
 estimated investment of about Rs.775 crore. The Board Plant is proposed
 to be installed adjacent to the existing Pulp and Paper Plant at
 Lalkua, Dist. Nainital, Uttarakhand and is expected to be operational
 by December, 2009. Quotations for the main Plant and Machinery have
 been received and are under process.
 
 Fibre Line (Pulp Plant)
 
 It has been decided to install a state-of-the-art, eco-friendly Fibre
 Line to produce best quality wood pulp, with a capacity of 450 tonnes
 per day and a Chemical Recovery boiler of 1,200 tonnes per day to meet
 the requirements of pulp for the Paper Board Plant. The Fibre Line will
 also help in the enhancement of paper production in the existing plants
 at Lalkua, Dist. Nainital, Uttarakhand. The estimated investment for
 this expansion is Rs. 495 crore and the plant is expected to be
 operational by December, 2009. We have already received quotations for
 the main plant and machinery and these proposals are currently being
 reviewed.
 
 d) General
 
 Modernisation and technological upgradation programmes, as necessary,
 are ongoing in all the units of the Company to maintain competitiveness
 and achieve better quality. Stringent cost control measures continue to
 be implemented in all possible areas.
 
 5.  LAND DEVELOPMENT AT WORLI.MUMBAI
 
 in view of the closure of Century Mill after necessary permission from
 the State Government was obtained, we have decided to develop the
 available mill land at Worli, Mumbai for commercial purposes. To obtain
 the optimum benefit, we intend to use the land for the purpose of
 Hospitality services, Information Technology, Information Technology
 Enabled Services and other commercial purposes, subject to various
 permissions and approvals, which will be obtained in due course. The
 construction work can commence only after all permissions and approvals
 are in place.
 
 A separate report on Corporate Governance is enclosed as a part of this
 Annual Report. A certificate from the Auditors of the Company regarding
 compliance with Corporate Governance norms stipulated in Clause 49 of
 the Listing Agreement is annexed to the report on Corporate Governance.
 
 Various Divisions of the Company have received numerous awards for
 environmental excellence, efficiency in energy, safety provisions etc.
 Some of such important awards are mentioned hereunder:
 
 - Gold Trophy for best export performance for the year 2006-07 in the
 category of Tyre Yarn/Cord / fabrics received from The Synthetic &
 Rayon Textiles Export Promotion Council (SRTEPC).
 
 - National Award instituted by National Council for Cement and Building
 Materials for Best Environmental Excellence in limestone mines for
 the years 2005-06 and 2006-07.
 
 - First prize for Overall Performance (Mechanised Mines), Top Soil
 Management and Noise Vibration Control and Aesthetic Beauty for its
 limestone mines during the Mines Environment and Mineral Conservation
 Week 2007-08 held under the guidance of Indian Bureau of Mines, Nagpur
 Region.
 
 - First prize for Standard of Working and Publicity & Propaganda
 during the Annual Safety Week celebrations for the year 2007, held
 under the guidance of Directorate General of Mines Safety, Bilaspur
 Region.
 
 c) Maihr cemet
 
 - First prize in Fire Safety Provision and Organisation for its
 limestone mines, during the 25th Metalliferous Mines Safety Week, 2007
 of Jabalpur Region.
 
 - Sonbhadra Award in Publicity Propaganda and First prize for
 Overall Performance, Water Quality Management and Waste Dump
 Management for its Limestone mines during Mines Environment and
 Mineral Conservation Week in the year 2007-08, held under guidance of
 Indian Bureau of Mines, Jabalpur Region.
 
 - National Safety Award for outstanding performance in Industrial
 Safety during the performance year 2005 in achieving Based on accident
 free year.
 
 - Three students (scouts) from our School have been selected for
 Presidents Award and 10 students (4 Scouts & 6 Guides) have been
 selected for Governors Award during the academic session 2007-08.
 
 d) Manikgarh Cement
 
 - First prize in the Noise Vibration & Aesthetic Beauty, Reclamation
 and Rehabilitation and Overall Performance for its Limestone Mines,
 during the Mines Environment and Mineral Conservation Week 2007-08,
 Nagpur region (Madhya Pradesh and Maharashtra), held at BALCO, Korba
 (Chhattisgarh State) in December, 2007.
 
 - Prize for excellence in Process category at the National Convention
 held at Kolkata for case study in Optimisation of kiln coal firing to
 Manikgarh Quality Circle Group.
 
 - Prize for excellence in Electrical category for case study in Excess
 power consumption in auxiliaries group of Cement Mills, Instrument
 category for case study in Power Saving in CT screw group in Raw mill
 areas, Ropeway category for case study in To eliminate jamming of
 main belt conveyor discharge chute, Packing Plant category for case
 study in Frequent bag jamming in conveying system in Packer machines,
 Mines category for their case study in Easy arrangement of battery
 lifting and shifting to and from dumpers at the Chapter level
 convention at Nagpur to Manikgarh Cement Quality Circle Group.
 
 e) Pulp and Paper
 
 - Excellent Energy Efficient Unit, with a National Award for
 Excellence in Energy Management 2007, by Confederation of Indian
 Industry, held at Hyderabad during 12-13th September, 2007.
 
 - Excellent Award in the 21st National Convention on Quality Circles
 organised by Quality Circle Forum of India, Kolkata Chapter, at
 Kolkata, during the 27th and 30th December 2007, for case study
 presentation by Units Quality Circle SURYA.
 
 - Certificate of Appreciation for Excellent Performance in the 18th
 Convention on Quality Circles organised by Quality Circle Forum of
 India, Kanpur Chapter, at Kanpur during 6th and 7th October, 2007.
 
 8.  ENVIRONMENT AND POLLUTION CONTROL:
 
 All the units of the Company have taken adequate measures to ensure
 pollution free operations. The Companys units continue to make
 vigorous efforts for attaining high environmental standards not merely
 to comply with statutory regulations but as a means of ensuring optimum
 utilisation of resources. It is our intrinsic belief that sustainable
 progress will only accrue to organisations with social responsibility
 and care for the environment. We shall continue to strive for work
 practice that seeks to improve on existing standards.
 
 Top priority continues to be given to preservation of environment by
 all the units of the Company. To combat pollution and strengthen the
 area ecology, considerable emphasis is given to plantation of fragrant
 and shady trees. All manufacturing facilities possess the required
 environmental clearance from the respective Pollution Control Boards
 and comply with the relevant legislation.
 
 9.  DIRECTORS:
 
 Under Article 130 of the Articles of Association of the Company Shri
 E.B. Desai and Shri Amal Ganguli retire by rotation and being eligible,
 offer themselves for re-election.
 
 10.  AUDITORS:
 
 The retiring Auditors, M/s. Dalai & Shah, Chartered Accountants, are
 eligible for re-appointment and have expressed their willingness to
 accept re-appointment. In terms of Section 224A of the Companies Act,
 1956, their re-appointment needs to be approved by the members and
 their remuneration has to be fixed.
 
 11.  AUDITORSREPORT:
 
 The Auditors Report to the Shareholders does not contain any
 reservation, qualification or adverse remark.
 
 12.  COST AUDITORS:
 
 Pursuant to the directives of the Central Government under the
 provisions of Section 233B of the Companies Act, 1956, qualified Cost
 Auditors have been appointed to conduct cost audits relating to several
 products manufactured by the Company.
 
 13.  DIRECTORS RESPONSIBILITY STATEMENT:
 
 On the basis of compliance certificates received from the concerned
 executives of the respective divisions of the Company and subject to
 disclosures in the annual accounts, as also on the basis of the
 discussion with the Statutory Auditors of the Company from time to
 time, we state:
 
 i) that in the preparation of the annual accounts, the applicable
 accounting standards have been followed and proper explanations
 provided relating to material departures, if any;
 
 ii) that the Directors have selected appropriate accounting policies
 and applied them consistently and made judgements and estimates that
 are reasonable and prudent so as to give a true and fair view of the
 state of affairs of the Company at the end of the financial year and of
 the profit or loss of the Company for that period;
 
 iii) that the Directors have taken proper and sufficient care to ensure
 the maintenance of adequate accounting records in accordance with the
 provisions of the Companies Act for safeguarding the assets of the
 Company and for preventing and detecting fraud and other
 irregularities, if any;
 
 iv) that the Directors have prepared the annual accounts on a going
 concern basis.
 
 14.  CONSERVATION OF ENERGY.TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
 EARNINGS AND OUTGO:
 
 a) Energy Conservation Awards for Rayon Division
 
 Century Rayon has bagged State Level Award for excellence in Energy
 Conservation & Management 2006.
 
 b) Cement Divisions
 
 Century Cement has received National Award in the Indian Cement
 Industry in the year 2005-06 for best improvement in energy performance
 in the manufacture of blended cement and for second best improvement in
 electrical energy performance.
 
 In the tenth F LSmidth Energy Awards 2007 for energy conservation,
 Maihar Cement Unit No. 2 has bagged the first prize for the lowest
 electrical energy consumption Kwh per tonne of cement production
 amongst modern cement plants using VRM technology, situated in the
 state of Madhya Pradesh and Chhattisgarh.
 
 In the tenth F L Smidth Energy Awards 2007 in the state of Madhya
 Pradesh and Chhattisgarh for energy conservation, Century Cement was
 honoured with the first prize for Minimum Plant Heat Rate (Kcal/Kwh)
 with respect to Captive Thermal Generation for the year 2006-2007.
 
 c) General
 
 A statement giving details of conservation of energy, technology
 absorption, foreign exchange earnings and outgo, in accordance with the
 Companies (Disclosure of Particulars in the Report of Board of
 Directors) Rules, 1988 is annexed and marked Annexure A and forms
 part of this Report.
 
 15.  PARTICULARS OF EMPLOYEES:
 
 Details of remuneration paid to employees, as required by Section
 217(2A) of the Companies Act, 1956, are set out in a separate statement
 attached hereto and marked Annexure B and forms part of this Report.
 
 16.  CASH FLOW ANALYSIS:
 
 In conformity with the provisions of clause 32 of the Listing Agreement
 the Cash Flow Statement for the year ended 31.03.2008 is annexed
 hereto.
 
 17.  APPRECIATION
 
 The Company places on record its deep appreciation of the devoted
 services of the loyal workers, executives and other staff of the
 Company, who have contributed in no small measure to the performance
 and the Companys inherent strength. It also extends grateful thanks to
 Central and various State Governments, the investors, the banking
 circles, financial institutions and district level authorities for
 their continued support extended to the Company from time to time.
 Shareholders appreciation of the managements efforts expressed at the
 general meetings of the Company and otherwise, is a great fillip to
 strive for better performance year after year.
 
 Registered Office:
 
 Century Bhavan
 
 Dr. Annie Besant Road
 Worli, Mumbai-400030.
                                  On behalf of the Board,
                                      B.K. Birla
 
 Dated: 5th May, 2008                 Chairman