Dear Members,
 
 The Directors present their Forty Seventh Annual Report together with
 the Audited Accounts for the year ended 31st March 2011.
 
 1.  FINANCIAL RESULTS
 
                                       Rs./Lacs       Rs./Lacs
                                     Year ended     Year ended
                                     31st March     31st March
                                           2011           2010
 
 Net Sales and other Operating/
 Investment Income                        12481           9539
 
 Profit before Interest,
 Depreciation and Exceptional  
 item                                      2980           1471
 
 Interest                                  (131)          (193)
 
 Depreciation (Net)                        (444)          (382)
 
 Profit before Exceptional items 
 and tax                                   2405            896
 
 Profit on sale of Fixed Assets             261          56703
 
 Expenses on Buy-back of Shares             (13)             -
 
 Employees separation/othercost             (20)          (309)
 
 Profit before tax                         2633          57290
 
 Provision for Taxes                        628           9769
 
 Profit after taxation                     2005          47521
 
 Profit available for appropriation        2123          47562
 
 
 Appropriations
 
 Proposed Dividend                           98            550
 
 Corporate Dividend Tax                      16             93
 
 Transferto General Reserve                1500          46800
 
 Surplus carried to Balance Sheet           509            119
 
 2.  DIVIDEND
 
 The Directors are pleased to recommend a dividend of Rs. 2 per share
 being 20% of the paid-up equity capital of the company for the year
 ended 31s1 March 2011. Corporate Dividend Tax of Rs. 16 Lacs will be
 payable on the total dividend amount of Rs. 98 Lacs.
 
 3.  PERFORMANCE
 
 During the year 2010-11, the Company posted improved results with
 higher sales and increased investment income.
 
 The turnover of the Company increased by 6% to Rs. 95.72 Crores from
 Rs. 89.90 Crores in the previous year, despite the discontinuation of
 business from the Jalna Unit in the later part of the year. Investment
 and other Operating income of the Company also increased substantially
 to Rs. 29.09 Crores from Rs.  5.49 Crores.
 
 The gross profit of the Company increased to Rs. 29.80 Crores from Rs.
 14.71 Crores. There was one time profit of Rs. 2.61 Crores on the sale
 of Jalna fixed assets. After considering this and other extra-ordinary
 cost of Rs. 0.33 Crores, profit before tax was Rs. 26.33 Crores. Net
 profit after providing tax of Rs.  6.28 Crores, was Rs. 20.05 Crores.
 
 Although, the Company''s manufacturing turnover increased, the operating
 margin remained under pressure, primarily on account of major cost
 escalation in raw material and other inputs, which could not be passed 
 on to customers due to annual rate contracts with a few of the Government
  / Institutional customers and competitive market conditions.  Higher than 
 normal expenses, necessited on account of the company''s focus on 
 Asbestos-free business, was an additional factor adversely impacting 
 profitability.
 
 Prudent and judicious investments made by the Company during the year
 have yielded better results on account of optimizing the investments in
 various asset classes.
 
 As reported, in earlier years, the working of the Company''s Jalna Unit
 has continued to under-perform and remained below expectations. Having
 exhausted all efforts to revive, the Unit was ultimately sold in March,
 2011, after taking requisite approvals.
 
 With the sale of the Jalna facility, the Company will now focus on its
 Automotive & Industrial Friction Material business.  Simultaneously,
 the surplus funds in the Company continue to be judiciously deployed to
 maximise its returns in an efficient mannner.
 
 The Company participated at the Automechanika Fair at Frankfurt,
 Germany in September, 2010, thus improving its exposure to new products
 and global markets.
 
 Judicious and Prudent investments made by the Company during the year
 have yielded better results on account of optimizing the investments in
 various asset classes.
 
 
 4.  SHARE CAPITAL
 
 Pursuant to the Board approval dated 24th January, 2011 and various
 other approvals, the Company successfully bought back 5,77,000 Nos. of
 its Equity Shares. Accordingly, the Share Capital of the Company
 reduced from Rs. 550 Lacs to Rs. 492 Lacs, divided into 49,23,000
 Equity Shares of Rs. 10 each.
 
 5.  PUBLIC DEPOSITS
 
 There were no deposits at the beginning of the year and the Company did
 not accept any deposits from the public during the year.
 
 6.  PARTICULARS OF EMPLOYEES
 
 The particulars required pursuant to Section 217(2A) of the Companies
 Act, 1956 read with the Companies (Particulars of Employees) Rules,
 1975 as amended, are given in Annexure II to this report.
 
 However, in terms of the provisions of Section 219(1)(b)(iv) of the
 Companies Act, 1956, the Directors'' Report (excluding Annexure II) is
 being sent to all the shareholders of the Company. Any shareholder
 interested in obtaining a copy of the said annexure may write to the
 Company Secretary at the registered office of the Company.
 
 7.  CONSERVATION OF ENERGY & TECHNOLOGY ABSORPTION
 
 Particulars required under Section 217 (1)(e) of the Companies Act,
 1956 relating to conservation of energy and technology absorption are
 given in an Annexure to this Report
 
 8.  FOREIGN EXCHANGE EARNINGS AND OUTGO
 
 Foreign Exchange earnings from exports amounted to Rs. 954 Lacs, of FOB
 value whilst the outgo for raw materials, components and spares
 amounted to Rs. 1178 Lacs.
 
 9.  DIRECTORS
 
 The Board of Directors appointed Mr. Varunn Mody as an Executive
 Director for a period of five years w.e.f. 17th January, 2011,
 re-appointed Mr. P. K. Choudhary, as Managing Director for a period of
 two years w.e.f. 18th March 2011,Mr. Vinay Sarin as Executive Director-
 Marketing for a period of 1 year w.e.f. 9th August 2010 and Mr. V. D.
 Ingle as Executive Director - Manufacturing, for a period of one year
 w.e.f. 1st April, 2011, subject to approval of the members of the
 company.
 
 Lt. Gen. (Retd.) K.S. Brar & Mr. A.B. Vaidya, Directors, retire by
 rotation and, being eligible, offer themselves for re- • appointment.
 
 Mr. V.B. Haribhakti, retire by rotation, but not offers himself for
 re-appointment.
 
 Mr. V. D. Ingle, Mr. Vinay Sarin and Mr. D. L. Lyon Resigned from the
 Directorship of the Company w.e.f. 25* May 2011.
 
 The Board places its gratitude towards them for valuable services
 extended by them during the tenure as a Director of the company.
 
 10.  AUDITORS
 
 M/s Lodha & Co., the Auditors of your Company who hold office until the
 conclusion of the forthcoming Annual General Meeting, being eligible,
 offer themselves for re-appointment.
 
 11.  CORPORATE GOVERNANCE
 
 As required by the Listing Agreement, the Corporate Governance Report,
 including Management Discussion and Analysis Report and the Certificate
 of Compliance from the Auditors, is attached and forms part of this
 Report.
 
 12.  DIRECTORS''RESPONSIBILITY STATEMENT
 
 On the basis of information placed before them, the Directors
 state that
 
 (i) in the preparation of the annual accounts, the applicable
 accounting standards have been followed along with proper explanation
 relating to material departures;
 
 (ii) appropriate accounting policies have been selected and applied
 consistently and they have made judgments 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) proper and sufficient care for the maintenance of adequate
 accounting records in accordance with the provisions of the Act for
 safeguarding the assets of the Company and for preventing and detecting
 fraud and other irregularities.
 
 (iv) the annual accounts have been prepared on a going concern basis.
 
 12. ACKNOWLEDGEMENT
 
 The Directors gratefully acknowledges the support and co- operation
 given by all dealers, distributors, employees, shareholders and bankers
 and look forward to their continued support.
 
                                   By order of the Board of Directors
 
                                                           Raghu Mody 
                                                             Chairman
 Place: Mumbai 
 Date: 25th May 2011