The Directors present the 37th Annual Report along with the Audited
 Accounts and-Auditors Report for the financial year ended 31st March,
 2011.
 
 FINANCIAL RESULTS
 
 The highlights of the financial results for the Financial year ended
 31st March 2011 are given below.
 
                                                     (Rs. in Million)
 
                                       Current             Previous
                                       Financial          Financial 
                                       Year                    Year
                                      (2010-2011)        (2008-2010)
                                      (12 months)        (18 months)
 
 
 Sales & Other Receipts 
 (Net of Excise)                          3556.36            6525.22
 
 Profit before Interest and
 Depreciation                                3.68            1006.59
 
 Interest                                   25.54              22.58
 
 Profit before
 Depreciation                              (21.86)            984.01
 
 Depreciation                               55.08              73.36
 
 Impairment - Reversal 
 (Net of Provision)                        (17.12)                 -
 
 Profit before
 Taxation                                  (59.82)            910.65
 
 Income Tax / Fringe Benefit Tax 
 / Wealth tax                                0.60               2.44
 
 Deferred Tax
 Adjustment                                (30.12)            335.32
 
 Profit/(Loss) after
 tax                                       (30.30)            572.89
 
 Carried forward Loss of 
 earlier years                             417.31             990.20
 
 Balance of Loss carried to 
 Balance Sheet                             447.61             417.31
 
 DIVIDEND
 
 In view of the carried forward losses, the Directors express their
 inability to recommend any dividend for the year.
 
 INDUSTRY OVERVIEW
 
 The all India cement consumption during the year under review was
 around 208 million tonnes, a modest growth of 4.8 percent compared to
 around 198 million tonnes during the previous year. The total installed
 capacity at the end of the year was around 285 million tonnes, an
 increase of about 10 percent from the previous year. The current
 members of CMA exported 2.53 million tonnes of cement and clinker
 during the year as compared to 3.23 million tonnes during the earlier
 year.
 
 During the 12 months ended 31.3.2011, the cement consumption in Gujarat
 was 16 million tonnes as compared to 14.3 million tonnes in the
 previous year; a growth of 12 percent.
 
 In Gujarat, during the last two years, the installed cement capacity
 increased by 2.4 million tonnes, whereas the installed capacity in the
 neighbouring states of Rajasthan and Maharashtra went up by 8.64
 million tonnes. The total installed capacity is around 22.4 million
 tonnes at the end of the period under review.
 
 Performance Review
 
 Production and Despatches
 
 The production of clinker and cement for the twelve months ended
 31.3.2011 was 1.16 million tonnes and 1.21 million tonnes as against
 2.01 million tonnes and 2.03 million tonnes respectively in the earlier
 period of 18 months ended 31st March 2010.  The total sale of cement
 and clinker was 1.24 million tonnes as compared to 2.18 million tonnes
 in the earlier period of 18 months ended 31st March 2010. Thus the
 plant has run at a capacity utilisation of over 100 percent for the
 year under review.
 
 Exports and Marketing
 
 The Companys export of cement and clinker for the twelve months ended
 31.3.2011 was limited to 0.06 million tonnes as compared to 0.43
 million tonnes in the earlier period of 18 months ended 31st March
 2010. Lower consumption in international markets and higher local
 production resulted in reduced exports to the Middle East. The
 situation is likely to continue in the short term. The reduction in the
 volumes exported resulted in increased availability of cement in
 Gujarat, resulting in lower prices.
 
 Rehabilitation Scheme
 
 Members are aware that Honble AAIFR had sanctioned rehabilitation
 scheme in 2002 envisaging installation of DG sets and construction of
 jetty at Vadodara Jhala as also repayments to Banks, Financial
 Institutions and Government of Gujarat.  While the Company has
 installed DG sets at the factory and paid the dues of the Banks,
 Financial Institutions and Government of Gujarat, the construction of
 jetty is pending. The Company had therefore submitted a proposal for a
 modification in the sanctioned scheme to facilitate construction of
 jetty, reorganisation of existing share capital by de-rating of
 existing equity and allotment of shares at par on preferential basis.
 
 The Honble AAIFR directed the BIFR to sanction the Modified Draft
 Rehabilitation Scheme recommended by the Operating Agency, however,
 Honble BIFR discharged the company from its purview on the ground that
 the companys net worth has turned positive and the scheme has been
 substantially implemented.
 
 Aggrieved by the said order, the Company has since filed an appeal
 before the Honble AAIFR stating that the construction of jetty, which
 is a critical element for the sustained viability of the company,
 remains pending. The appeal has been admitted.
 
 Public Deposits
 
 The company has not invited and / or accepted any deposits, during the
 year.
 
 Cash Flow Statement
 
 Cash flow statement pursuant to Clause 32 of the listing agreement is
 attached and forms part of the report.
 
 Directors
 
 Mr. Venkatesh Mysore was appointed as an Additional Director of the
 Company with effect from 29th October 2010.  Pursuant to Section 260 of
 the Companies Act, 1956 he holds the office of the Director upto this
 Annual General Meeting and eligible for re-appointment.
 
 Mr. S. M. Khanjiwala, Mr. P. K. Behl, Mr. Hemnabh Khatau and Dr. Kala
 S. Pant shall retire by rotation at the ensuing Annual General Meeting
 and being eligible offer themselves for reappointment.
 
 Listing of Equity Shares
 
 The Companys equity shares are listed on the Bombay Stock Exchange
 Limited (BSE) and National Stock Exchange of India Limited (NSE). The
 company has paid listing fees as prescribed.
 
 Auditors
 
 M/s. Manubhai & Co, Chartered Accountants, Ahmedabad, the Statutory
 Auditors of the Company, holds office upto the conclusion of the
 ensuing Annual General Meeting in accordance with the provisions of the
 Companies Act, 1956. The Company has received letter pursuant to
 Section 224(1 B) of the Companies Act, 1956 confirming their
 eligibility to act as auditors if appointed at the annual general
 meeting.
 
 Cost Auditors
 
 In pursuance to Order No. 52/58/CAB-98 dated 30th October, 1998 issued
 under Section 233-B of the Companies Act, 1956, M/s. M. Goyal & Co.,
 Cost Auditors, have been appointed by the Board as Cost Auditor of the
 Company for the financial year 2011-12. Certificate of eligibility
 under Section 224 (1B) has been received.
 
 Particulars of Employees
 
 In terms of the provisions of Section 217 (2A) of the Companies Act,
 1956 and the Companies (Particulars of Employees) Rules, 1975 names and
 other particulars of the employees are required to be set out in the
 annexure to this report.  However, as per the provisions of Section
 219(1)(b)(iv) of the Companies Act, 1956 the Report and Annual Accounts
 of the Company sent to the shareholders do not contain the said
 annexure. Any shareholders desirous of obtaining a copy of the said
 annexure may write to the Company Secretary at the Registered Office of
 the Company.
 
 Industrial Relations
 
 The Company continued to maintain harmonious relations with its
 workers.
 
 Corporate Governance
 
 A separate report on the compliance with Clause 49 of the Listing
 Agreement with the Stock Exchanges on Corporate Governance and the
 Auditors Certificate on its compliance forms part of this Report.
 
 Management Discussion and Analysis
 
 The Management Discussion and Analysis Report is provided in a separate
 section and forms part of this Report.
 
 Directors Responsibility Statement
 
 Your Directors confirm:
 
 - These statements have been prepared in conformity with generally
 accepted accounting principles and appropriate accounting standards,
 judgements and estimates are reasonable and prudent.
 
 - The accounting policies selected and applied consistently give a true
 and fair view of the financial statements.
 
 - The company has implemented internal controls to provide reasonable
 assurances of the reliability of its financial records, proper
 safeguarding and use of its assets and detection of frauds and
 irregularities. Such controls are based on established policies and
 procedures and are implemented by trained, skilled and qualified
 personnel with an appropriate segregation of duties. The companys
 internal auditors conduct regular internal audits, which complement the
 internal controls.
 
 - The Directors have prepared the annual accounts on a going concern
 basis.
 
 Energy conservation, Technology Absorption and Foreign Exchange
 Earnings and Outgo.
 
 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 the relevant particulars are enclosed herewith
 in Annexure 1, forming part of the Report.
 
 Acknowledgement
 
 The Directors wish to thank the Honble Board for Industrial &
 Financial Reconstruction (BIFR), The Honble Appellate Authority for
 Industrial & Financial Reconstruction (AAIFR), Central Government,
 Government of Gujarat, Financial Institutions, Bankers, Shareholders,
 Employees, Stockists, Dealers and all other stakeholders associated
 with its operations for the co-operation and encouragement extended to
 the company.
 
 On behalf of the Board of Directors
 
 Jay M. Mehta        M. S. Gilotra
 
 Executive          Vice Chairman 
 Managing Director
 
 Place : Mumbai Dated : May 3, 2011