The directors are pleased to present the 26th Annual Report together
 with Audited Statement of Accounts of your Company for the year ended
 31st March 2012.
 
 FINANCIAL RESULTS
 
                                                          (Rs. in lacs)
 
                                           For the 
                                           year ended     For the 
                                                          year ended
                                           31.03.2012     31.03.2011
 
 Sales and Other Income                      74785.38       71900.94
 
 Profit before Financial Expenses, 
 Depreciation and Tax                         4106.41       22408.30
 
 Less: Interest & Other Financial Expenses    3549.48        1276.40
 
 Profit / (Loss) before Depreciation, Extra 
 Ordinary Items and Tax                        556.93       21131.90
 
 Depreciation                                 2653.54        1792.58
 
 Profit / (Loss) before Tax                  (2096.61)      19339.32
 
 Current Tax                                        -        5339.81
 
 MAT Credit Entitlement                             -              -
 
 Deferred Tax                                 (704.70)       1052.74
 
 Profit / (Loss) after Tax                   (1391.91)      12946.77
 
 Balance brought forward from previous year  13765.80        5042.44
 
 Appropriation : General Reserve                    _        1294.68
 
 : Dividend & Tax on Dividend                       _        2928.73
 
 Balance Carried to Balance Sheet            12373.89       13765.80
 
 Basic Earnings Per Share (Rupees)              (2.21)         20.59
 
 DIVIDEND
 
 In the absence of profits, your directors do not recommend any
 dividend.
 
 OPERATIONS REVIEW
 
 Gross Revenue from operations during the year under review is Rs.
 747,85.38 lacs as compared to Rs. 719,00.94 lacs in the previous year,
 an increase of 4.01%. The increase is primarily on account of larger
 sales volume of Polyester Film (Current Year - 50,207 MT, Previous Year
 - 31,210 MT). Though the volume of sales of Polyester Film increased by
 60.9%, the sales of Polyester Film in value terms increased by only
 5.9%. The increase in value terms was not proportionate to increase in
 volume terms on account of drastic reduction in per unit realization,
 due to adverse demand supply situation.  Adverse demand supply
 situation was caused mainly due to commissioning of new capacities both
 in India & Overseas and on account of ban on use of plastic films in
 packing of Pan Masala & Gutkha. Consumption of Polyester Film in Pan
 Masala & Gutkha accounted for 30% - 35% of the domestic demand, though
 the demand of Polyester Film for other applications continued to grow
 at about 15%. Drastic reduction in unit realization and margins
 resulted in Net Loss after Tax of Rs.  13,91.91 lacs during the current
 year as compared to Profit of Rs. 129,46.76 lacs in the previous year.
 
 Due to cheaper imports coming in from China, the sale of Engineering
 Plastics in CFL segment was lower by 40.6% as compared to previous
 year. Consequently, Net Sales of Engineering Plastics decreased by 8.6%
 from Rs. 7698.35 lacs to Rs. 7035.39 lacs, Due to adverse demand supply
 situation, the sale of Polyester Chips was also lower than the previous
 year by 26.2%.
 
 Company responded well to the adverse impact on domestic demand for
 Polyester Film caused due to ban and increased its focus on exports.
 During the year, Exports of Polyester Film increased by 78.7% in
 quantitative terms and by 27.4% in value terms. Exports accounted for
 40.2% of the Net Sales Turnover of the company during the year.
 
 The production of Polyester Film was higher at 51744 MT as compared to
 32116 MT during the year 2010-11 on account of commissioning of new
 Polyester Film plant in January 2011 and successful operation of
 enhanced capacity resulted in capacity utilization of approx. 91% in
 Polyester Film.
 
 On account of borrowings including foreign currency borrowings for the
 expansion projects and higher utilization of working capital
 facilities, interest and other financial expenses increased from Rs.
 1276.40 lacs to Rs. 3549.48 lacs. During the year 2011-12, Finance cost
 includes loss of Rs. 906.01 Lacs representing exchange losses arising
 on restatement of foreign currency borrowings to the extent they are
 regarded as an adjustment to finance cost, in accordance with paragraph
 4(e) of Accounting Standard 16 - ''Borrowing Cost''. Interest and
 financial expenses during the year under review were 5.07% of Net Sales
 though overall leveraging was still at prudent levels of 1.32.
 
 Executive Board of the Clean Development Mechanism (CDM) under United
 Nations Framework Convention on Climate Change in its meeting dated
 15th April 2011 has approved registration of Biomass based Thermal
 energy generation project of the company. Company would now be entitled
 to earn Certified Emissions Reductions (CERs) with effect from November
 2010.
 
 Details on operations, a view on the outlook for the current year and
 mitigation strategies adopted by the Management are provided in the
 ''Management Discussion & Analysis Report'' which forms an integral part
 of this Annual Report.
 
 DEBOTTLENECKING PROJECTS
 
 During the year under review, Company successfully commissioned
 Recycling Extruder, Off - Line Coater and Thermic Fluid Heating system.
 The initiatives would enable the Company to improve operating
 efficiency, inventory management and production of Value Added
 products.
 
 SUBSIDIARY COMPANIES
 
 Pursuant to Circular no. 2/2011 dated 8th February, 2011 of Ministry of
 Corporate Affairs (MCA), the Company has not attached Annual Accounts
 and other statutory reports of Ester International (USA) Limited
 (Subsidiary of Ester Industries Limited) for financial year 2011-12
 subject to compliance of conditions stated in the Circular.
 
 Further the Annual Accounts of the Subsidiary Company and the related
 detailed information shall be made available to the members of the
 Company or its subsidiary on their request.  Such Annual Accounts shall
 also be kept for inspection by any member at the Corporate Office and
 Registered Office of the Company and its subsidiary.
 
 FIXED DEPOSIT
 
 The Company has not accepted any deposit during the year.
 
 DIRECTORS
 
 The terms and conditions of appointment of Mr. Pradeep Kumar Rustagi,
 Executive Director & CFO and Mr. Ashok Kumar Agarwal, Executive
 Director - Operations & Projects were modified in the Board Meeting
 held on 14th February, 2012 with approval of shareholders in the
 Extra-Ordinary General Meeting held on 7th April, 2012.
 
 Mr. V. B. Haribhakti, Mr. Dinesh Chandra Kothari and Mr.  Arvind Kumar
 Singhania, directors of the Company, retire by rotation and being
 eligible, offer themselves for reappointment at the ensuing Annual
 General Meeting.
 
 CORPORATE GOVERNANCE
 
 The Company has complied with the mandatory provisions of Corporate
 Governance as prescribed in the Listing Agreement with the Stock
 Exchanges. A separate report on Corporate Governance is included as a
 part of the Annual Report along with the practicing Company Secretary''s
 Certificate on its compliance.
 
 DIRECTORS'' RESPONSIBILITY STATEMENT
 
 Pursuant to the requirement under Section 217(2AA) of the Companies
 Act, 1956 with respect to the Directors'' Responsibility Statement, the
 Directors confirm on the basis of information placed before them by the
 Management and Auditors:-
 
 1.  That in the preparation of the annual accounts for the Financial
 Year ended 31st March 2012 the applicable Accounting Standards has been
 followed;
 
 2.  That the Company has selected appropriate accounting policies and
 applied them consistently and made judgment and estimates that were
 reasonable and prudent so as to give a true and fair state of the
 affairs of the Company at the end of the financial year and of the
 Profit and Loss of the Company for the year under review;
 
 3.  That the Company has 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; and
 
 4.  That the accounts of the Company for the financial year ended 31st
 March 2012 has been prepared on a going concern basis.
 
 The Company''s Internal Auditors have conducted periodic audit to
 evaluate the adequacy of internal controls and to provide reasonable
 assurance that the Company''s established policies and procedures have
 been followed. The Audit Committee constituted by the Board reviews the
 internal controls and financial reporting issues with Internal Auditors
 on regular basis.
 
 CODE OF CONDUCT
 
 The Code of Conduct, as adopted by the Board of Directors, is
 applicable to all Directors and senior management of the Company. They
 have affirmed compliance with the Code of Conduct. A declaration to
 this effect duly signed by Executive Director-Operations & Projects is
 enclosed as a part of the Corporate Governance Report. A copy of the
 Code of Conduct is available on the Company''s website viz.
 www.esterindustries.  com
 
 Code is based on fundamental principles, viz. good corporate governance
 and corporate citizenship. The Code covers Company''s commitment to
 sustainable development, concern for occupational health, safety and
 environment, a gender friendly workplace, transparency and auditability
 and legal compliance.
 
 CONSOLIDATED FINANCIAL STATEMENT
 
 In accordance with the Accounting Standard AS-21 on Consolidated
 Financial Statements, your directors provide the audited Consolidated
 Financial Statements in the Annual Report.
 
 AUDITORS'' REPORT
 
 Auditors'' Report read together with Annexures referred to in Paragraph
 3 of the Auditors'' Report do not contain any qualification of
 significant nature and do not call for any explanation/clarification.
 
 AUDITORS
 
 M/s. S.R. Batliboi & Company, Chartered Accountants retire at the
 forthcoming Annual General Meeting and are eligible for reappointment.
 M/s S. R. Batliboi & Company has confirmed that their appointment, if
 made, shall be within the limits of Section 224(1B) of the Companies
 Act, 1956.
 
 COST AUDITOR
 
 During the year under review, Ministry of Corporate Affairs (MCA) had
 issued orders and notification under which the Company is required to
 appoint Cost Auditor in terms of section 233B of the Companies Act,
 1956 to get the cost Records audited for financial year 2012-13 and
 onwards.
 
 Your Directors have appointed M/s Sanjay Gupta & Associates, Cost
 Accountants, to conduct the audit of Cost Records of the Company for
 the financial year 2012-13 in respect of all Businesses of the Company
 
 LISTING OF SECURITIES
 
 Your Company''s securities are currently listed with Bombay Stock
 Exchange Limited (BSE) and National Stock Exchange of India Limited
 (NSE). The Company has paid the listing fees to BSE and NSE for the
 financial year 2012-13.
 
 CONSERVATION OF ENERGY,TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
 EARNING AND OUTGO
 
 The prescribed details as required under Section 217(1)(e) of the
 Companies Act, 1956 read with the Companies (Disclosure of Particulars
 in the Report of Board of Directors) Rules, 1988 are set out in the
 Annexure ''A'' forming part of this report.  Your Company was a net
 foreign exchange earner during the year under review.
 
 PARTICULARS OF THE EMPLOYEES
 
 The particulars of the employees drawing the salary as prescribed under
 Section 217(2A) of the Companies Act, 1956 read with Companies
 (Particulars of Employees) Rules, 1975 form part of this report.
 
 As per the provisions of Section 219(1)(b)(iv) of the Companies Act,
 1956, the reports and accounts are being sent to all shareholders of
 the Company excluding the statement of particulars of the employees.
 Any shareholder interested in obtaining a copy may write to the Company
 Secretary of the Company.
 
 ACKNOWLEDGEMENT
 
 Your Directors acknowledge the cooperation and assistance received from
 various departments of Central & State Government and banks.
 
 Your Directors wish to place on record their appreciation of the
 sincere services rendered by the workmen, staff and executives of the
 Company at all levels ensuring successful management of the Company.
 Your Directors also thank the shareholders for their continued support.
 
                                                 On behalf of the Board
 
 Date : 1st August, 2012                         Arvind Kumar Singhania
 
 Place : New Delhi                                             Chairman