Dear Shareholders
 
 The Directors are pleased to present the 50th Annual Report and the
 Audited Annual Accounts of the Company for the financial year ended
 31st March, 2011.
 
 The financial performance of the Company for the year ended March 31,
 2011 is summarized below.
 
                                                        (Rs. in Lacs)
 
                                           Year ended      Year ended
 
                                           31/03/2011      31/03/2010
 
 Gross Sales                                 73803.91        52071.24
 
 Operating Profit(Loss)                       7235.40        (3456.57)
 
 Less: Interest                               2088.35         2323.10
 
 Less: Depreciation                           2517.74         2652.28
 
 Profit/(Loss) before tax                     2629.31        (8431.95)
 
 Less: Provision for taxation
 
 Less: Prior Period adjustments                  57.72         (124.16)
 
 Profit/(Loss) after tax & Prior period       2571.59        (8307.79)
 
 adjustments/ Provisions,
 
 However, in view of accumulated losses as at the end of the Financial
 Year 2010-11 are carried forward, your Directors do not recommend any
 dividend on equity shares for the year ended 31 st March, 2011.
 
 RESULTS OF OPERATIONS
 
 During the year under review the Company was able to generate the Net
 profit of Rs. 25.72 crores during the year, while the Net Loss during
 the previous year was Rs. 83.08 crores.
 
 As regards the unit wise performance, the Net Profit of Kochi Unit was
 Rs. 130.08 crores which was much higher as compared to the previous
 year''s profit of Rs.14.74 crores. The Rasayani Unit recorded a Net Loss
 of Rs. 104.37 crores as compared with the previous year''s loss of Rs.
 97.82 crores.
 
 OPERATIONS :
 
 During the year under Report, your Company''s Kochi unit, achieved a
 sales turnover of 84082 MTs valuing Rs.58120.81 lacs as against 72172
 MTs valuing Rs. 38032.63 lacs of the previous year.
 
 With the production of 234684 MTs (main products) during the year
 2010-11 as against the production of 221249 MTs (main products) in
 2009-10, your Company could achieve an overall capacity utilization of
 58% during the year. Your Company has recorded the sale of 129021.09
 MTs during the year (last year 125512.48 MTs) valuing Rs.64142.59 lacs
 (last year Rs.45940.24 lares).
 
 The high labour cost and high incidence of cost on closed plants at
 Rasayani unit are the major concerns. Your Company has continued its
 cost cutting measures to counter these problems and in order to be
 competitive and improve performance and profitability.
 
 PRODUCTION :
 
 Kochi Unit:
 
 During the year, your Company''s Kochi Unit could achieve 166886 MTs of
 production (main products) which was higher than previous year
 production (main products) of 137730 MTs. The capacity utilization for
 the year 2010-11 was 109%.
 
 Rasayani Unit:
 
 During the year, Rasayani unit of your Company could achieve only 67798
 MTs (main products) of production as against 83520 MTs production (main
 products) of the previous year. The capacity utilization for the year
 2010-11 was 27%.
 
 MARKETING :
 
 HOC continued to enjoy support from all its valuable customers during
 the year 2010-11 due to excellent quality of its products manufactured
 at Kochi and Rasayani. It has achieved sales turnover of Rs.667.36
 Crores (net of excise duty) as against Rs. 478.63 crores (net of excise
 duty) of the previous year. The sales volume during year 2010-11 was
 1,45,173.65 MTs against 1,43,747.48 MTs for the year 2009-10,
 registering an increase in sales realization for the year amounting to
 Rs. 188.73 crores as compared to previous years sales of Rs. 478.63
 crores.
 
 STATUS OF OPERATIONS AND FUTURE PLANS
 
 HOCL has signed the Gas transmission Agreement with M/s GAIL.  With the
 availability of Natural Gas from GAIL, the Company has changed over the
 feed stock of Hydrogen from Naphtha to Natural Gas to reduce the cost
 of production. Further for boiler operation, natural gas is used in
 place of furnace oil to reduce steam cost.
 
 ENERGY CONSERVATION/TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS
 AND OUTGO
 
 Information in accordance with the provisions required to be disclosed
 under Section 217(1)(e) of the Companies Act, 1956 read with the
 Companies (Disclosures of particulars in the Report of Board of
 Directors) Rules, 1988, regarding conservation of energy, Technology
 Absorption and Foreign Exchange Earning and outgo, are given at
 Annexure II to this Report.
 
 RESEARCH & DEVELOPMENT
 
 R&D continues to do good job in Research. Over the years, it has
 adopted to changing times and has been contributing with the current
 needs of the Company by maximum utilization of its existing resources.
 It has endeavored to generate revenues by way of Royalty through its
 catalyst development and various developments in processes. To generate
 revenues through licensing of intellectual property, it has displayed
 different process technologies developed by the R&D Dept. It is
 actively involved in research program with Sud-Chemie India Private
 Limited for re-use of spent catalyst by repelletization of FD catalyst/
 Aniline catalyst.
 
 R&D Dept. is developing vapour face process of Kerosene fuel and also
 accelerated method for in process monitoring of aromatic in Kerosene
 for ISRO.
 
 HUMAN RESOURCE DEVELOPMENT AND INDUSTRIAL RELATIONS:
 
 Company has recognised the importance of human resource and as a plan
 of upgrading skills and knowledge of the employees, emphasis is
 continued to be given for training by organising inhouse training
 programmes and deputing employees to attend training programmes. During
 the year 2010-11, in all 43 training programmes were conducted, 734
 mandays were trained through inhouse training programme, 510.5 mandays
 were trained by sponsorship (outside) training and 509.5 mandays were
 trained through on job training.
 
 Thus, total mandays trained were 1754. Further, ISO & computer
 awareness programmes were conducted for employees. First Aid awareness
 programmes from outside faculty were also arranged for our employees.
 
 As part of the implementation of ERP in HOCL, Kochi much emphasis was
 given in imparting training to the employees at Kochi Unit.  In Kochi
 Unit regular Refresher courses were arranged in Safety & ISO
 implementations. First Aid Recertification course was also arranged
 during this year.
 
 CORPORATE SOCIAL RESPONSIBILITY
 
 Company right from its inception is conscious about its social
 responsibilities. To fulfil this, Company is providing basic civic
 amenities to the neighbouring villages, rendering assistance to the
 neighbourhood in different forms the details are given hereunder:
 
 Company has provided land to Gulsunda Grampanchayat for construction of
 cremation shed at Turade village.
 
 Company is giving scholarship to SC/ST students studying in X and XII
 std. The Company also extends need based assistance to deserving SC/ST
 students in the nearby villages for their graduation and post
 graduation.
 
 Company is also extending vocational training facilities to the wards
 of employees, provides the facilities to carry out project work for
 students of nearby Engineering Colleges, Management Institutions for
 enhancing their practical knowledge.
 
 Company has been active in doing peripheral development works for the
 betterment of villages around the factory area.
 
 HOCL, Kochi Unit has extended support to the initiative taken by the
 City Police, Kochi towards a fool proof Security to the Citizens and
 safeguarding the critical installations of Kochi.
 
 Kochi Unit has provided 03 Sodium Vapour Lamps to the newly constructed
 Bus Stand-cum-shopping complex of Chottanikkara Grama Panchayat.
 
 Kochi Unit has sponsored the READ, Rotary Emplowerment against Aids and
 Drugs, a project of Rotary International for Higher Secondary School
 Students. The project was implemented at Govt.
 
 Boys'' Higher Secondary School, Tripunithura.
 
 Kochi Unit extended financial support to the family Welfare Programme
 for the empowerment of Women of Vadavucode Grama Panchayat to supply
 School Kits for the visually impaired children and Diabetic Awareness
 Programme of Govt. Ayurveda College, Tripunithura.
 
 PARTICULARS OF EMPLOYEES - INFORMATION REQUIRED
 
 UNDER SECTION 217(2A) OFTHE COMPANIES ACT, 1956
 
 No employee of the Company has drawn the remuneration during the year
 2010-11 or any part thereof, in excess of the limits specified under
 the Companies (Particulars of Employees) Rules 1975.
 
 Accordingly particulars of employees'' remuneration prescribed u/sec 217
 (2A) of the Companies Act, 1956 are not furnished.
 
 VIGILANCE
 
 The Vigilance Department headed by Chief Vigilance Officer, has two
 main functional Offices, one at Rasayani (Raigad) in Maharashtra and
 another at Ambalamugal (Kochi) in Kerala. Keeping in view of the
 Principles of Corporate Governance, the main focus of the Vigilance
 department has been to help the sincere, dedicated and honest personnel
 working in the Organisation to discharge their function effectively and
 efficiently so that the target of optimum turnover and profitability
 are achieved in a transparent manner.
 
 The Vigilance department takes prompt action in respect of complaints
 received. There is a comprehensive complaint handling policy and
 prescribed punitive action is duly suggested, after conducting fair and
 impartial investigation/enquiry, where ever required. The Annual
 Property Returns of the Officers are periodically scrutinized and
 inspection of various transactions/activities are undertaken to detect
 deviation, if any, and advise corrective measures. Various Vigilance
 Awareness Programmes, as per guidelines issued by the CVC, are observed
 and awareness sessions are conducted for the personnel regarding
 vigilance related matters as well as in respect of CDA Rules, RTI Act,
 PIDPI (Whistle Blowers Act) etc. The vigilance department has been
 instrumental in revising the existing manuals and policies i.e. the
 Purchase Policy, the Works Policy, the Marketing Manual etc. so that
 the laid down procedures, policies, rules, regulations etc. of the
 Company and that of the Central Vigilance Commission are duly followed.
 
 The vigilance department maintains close interaction with CVC, CBI and
 other government agencies. The personnel working in the vigilance
 department have undergone training in organization like CBI academy at
 Ghaziabad, Institute of Secretariat Training & Management at New Delhi
 etc. The vigilance wing has been sincerely and consistently helping all
 personnel of the Organisation in improving their efficiency and
 effectiveness and, in turn, achieving the set goals of the
 Organisation.
 
 HEALTH, ENVIRONMENT, FIRE & SAFETY Health :
 
 - Physical Check-up, the Special Certificate of Fitness in Form No. 23
 and ascertaining Health Status in Form No. 7 of all employees have been
 carried out by the Certifying Surgeon for the year 2010-2011.
 
 - The Industrial Health Centre is provided at both the Units and is
 well maintained to provide services and facilities to employees.  This
 Industrial Health Centre is maintained in good order with services and
 facilities as per scale laid down.
 
 - No complaints are noticed among the employees working in the various
 plants.
 
 Environment, Fire & Safety:
 
 The Company pays special attention to ensure safety of the factory and
 workers employed therein.
 
 The Company accords the same priority attention to safety aspects as it
 does to production and productivity, be it in a personal safety,
 process safety, environmental safety or product stewardship and
 allocated adequate resources of men, machine, money, time and energy to
 maintain the standards. Thus performance during the year is very good.
 Your Company''s both Units could maintain the quality of treated
 effluent, stack emission and ambient air quality well within the limits
 stipulated by statutory authorities through out the year.
 
 The Company continued to maintain good safety record without any major
 accident of Fire. Consistent safety training, safety audit, safety
 inspection and Hazop studies were performed to keep the safety standard
 high at both Kochi and Rasayani units.
 
 In order to augment our fire fighting capacity at Kochi unit, mutual
 aid scheme for emergency help between HOCL, BPCL - KR & FACT (CD) is in
 existence.
 
 HOCL Rasayani Unit is a signatory to Responsible Care movement.
 
 We are committed to the concept of self realization and improvement in
 all aspects of safety.
 
 Emergency Response Centre (ERC), a voluntary commitment undertaken by
 Rasayani Unit to tackle emergencies arising out of road transportation
 of hazardous chemicals is functioning quite well and this effort is
 acknowledged by general public as well as government authorities.
 
 The Company has made it mandatory to have fire and safety training for
 all employees.
 
 HOC Kochi unit received safety awards from National Safety Council
 (Kerala Chapter) and Dept. of Factories & Boilers, Govt, of Kerala for
 outstanding performance in industrial safety during the year 2010.
 
 Security System :
 
 Kochi Unit of HOCL has been classified as ''MAJOR ACCIDENT HAZARD
 INSTALLATION'' by the Govt, of Kerala. The security requirements are met
 from the agencies sponsored by the Director General (re-settlement),
 Ministry of Defense, Govt, of India. Security Guards are posted in the
 identified areas inside the Factory premises and also in Township round
 the clock.
 
 In view of the increased threat perception in Kochi, the Unit has been
 advised to take suitable measures for upgrading the security by the
 concerned authorities. Action is being taken to upgrade the present
 security system.
 
 IMPLEMENTATION OF OFFICIAL LANGUAGE POLICY
 
 In compliance of section 3 (3) of the Official Language Act, 1963 and
 Official Language Rules 1976 framed thereunder, Company has implemented
 various measures effectively given in the annual programme for 2010-11.
 All documents coming under Section 3(3) like Part I Orders, Part II
 Orders, Circulars, Administrative and other Reports, Press-Release etc.
 were issued bilingually. All Hindi Letters were answered in Hindi only.
 Our Company participated in all the programmes organized by Mumbai Town
 Official Language Implementation Committee. Hindi Fortnight was
 organized at both Rasayani and Kochi Units and in the Corporate Office
 in Mumbai from 14th September, 2010 to 28th September, 2010. During
 this period various competitions were organized. Employees actively
 participated in this competitions. Annual Report of the Company was
 translated in Hindi and was printed bilingually. Efforts are being made
 to fulfil the target set in the Annual Programme issued by Department
 of Official Language, Ministry of Hon. Affairs. Website of the Company
 is prepared in Hindi also.
 
 At Kochi Unit to comply with the official language Policy of the
 Government, Workshops on Official language are regularly conducted for
 the employees who possess working knowledge in Hindi so as to encourage
 them to use Hindi in their day to day office work. Total 10 workshops
 were conducted during the Year 2010 in which more than 100 employees
 were trained.
 
 At Kochi Unit the Official Language Implementation Committee has been
 constituted for review of the Hindi Implementation at the Unit and the
 said committee meets regularly.
 
 ISO CERTIFICATION :
 
 HOCL, Rasayani Unit, has been awarded ISO-9001:2008 certificate on
 11.01.2011. This certificate has been awarded by M/s Bureau Veritas
 Certification (India) Pvt. Ltd. and is valid till 9.02.2014.  MS of
 Kochi Unit ISO-9001-2008 is recertified and is valid upto June, 2014.
 ISO-14001-2004 is valid up to November 2011.
 
 INSURANCE
 
 All properties and insurable interest of the Company including
 building, plant and machinery and goods are adequately insured. As
 required under Public liability Insurance Act, 1991 the Company has
 taken necessary insurance cover.
 
 DEPOSITORY SYSTEM
 
 As the members are aware your Company''s shares are tradable
 compulsorily in electronic form and your Company has established
 connectivity with both the depositories i.e. National Securities
 Depository Limited (NSDL) and Central Depository Services (India)
 Limited (CDSL). In view of the enormous advantages offered by the
 Depository system, Members are requested to avail the facility of
 dematerialisation of the Company''s shares on either of the depositories
 as aforesaid.
 
 MANAGEMENT DISCUSSION AND ANALYSIS REPORT
 
 In accordance with the listing agreement, the Management Discussion and
 Analysis Report is annexed hereto in Annexure V and forms part of the
 Directors'' Report.
 
 CORPORATE GOVERNANCE
 
 The Company has complied with the various requirements of Corporate
 Governance. The details in this regard form part of this report in
 Annexure VI.
 
 RESPONSIBILITY STATEMENT
 
 The Directors confirm:
 
 a) that in the preparation of the annual accounts, the applicable
 accounting standards have been followed and that no material departures
 have been made from the same;
 
 b) that we have selected such accounting policies and applied them
 consistently and 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;
 
 c) that we have 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;
 
 d) that we have prepared the annual accounts on a going concern basis.
 
 HINDUSTAN FLUOROCARBONS LIMITED : (Subsidiary)
 
 During the year, the sales turnover was Rs. 3352.42 lacs as against Rs.
 1927.06 lacs in the previous year. During the year under report
 production of PTFE was 124.58 MTs as against 85.88 MTs in the Previous
 year. Company has achieved 100% capacity utilization of CFM-22 plant
 and produced 1265 MT as against 940.5 MTs in the previous year. This
 wilt significantly improve the revenue from CDM.
 
 During the year, 405.49 MT of CFM-22 was sold in the market and balance
 quantity was used as feed stock to manufacture various products
 including Fluoro Speciality Chemicals.
 
 STATUS OF CLEAN DEVELOPMENT MECHANISM (CDM) PROJECT AT HFL:
 
 The Company has received first lot of 210142 CERs from UNFCCC.
 Verification of second lot is in progress and issuance is expected in
 FY 2011-2012.
 
 The Statement Pursuant to Sec. 212 of the Companies Act, 1956 is given
 in Annexure I.
 
 AUDITORS
 
 In terms of provisions of Section 619(2) of the Companies Act,1956, the
 Comptroller & Auditor General of India, under its letter No. CA
 V/COY/CENTRAL GOVT.HOCL(2)/1172 dated 31/8/2010 has appointed M/s NBS &
 Co. Chartered Accountants, Mumbai as Auditors of the Company to audit
 the accounts of the Rasayani Unit and to audit the consolidated
 accounts of the Company. Vide CAG under its letter No. CA V/COY/CENTRAL
 GOVT.HOCL(2)/8 dated 12/7/2010 has appointed M/s Sasi Vijayan & Rajan,
 Cochin as Branch Auditors to audit the accounts of Cochin Unit for the
 year ended 31 st March, 2011.
 
 The replies of the Management/the Board of Directors on the Auditors
 Qualification in the Auditors'' Report to the members are furnished in
 Annexure IV
 
 The report of the Comptroller & Auditor General of India under section
 619(4) of the Companies Act, 1956, on the Accounts of the Company for
 2010-11 is annexed in this Annual Report.
 
 Pursuant to directions from the Ministry of Corporate Affairs for
 appointment of Cost Auditors, Board of Directors of the Company
 appointed M/s V.J.Talati & Co. as the Cost Auditors of Rasayani Unit
 for 2010-2011 for Sulphuric Acid, Aniline, Formaldehyde, Caustic Soda,
 Nitro Benzene and M/s Panikar & Company as cost Auditors of Kochi Unit
 for the year 2010-11 for Phenol, Acetone & Polypropylene products.
 
 DIRECTORS
 
 During the year 2010-11, the tenure of Dr. B.D. Kulkarni, & Dr.
 Sukumar Devotta, Non-Official Independent Directors expired on 27th
 May, 2010.
 
 Consequent to the superannuation of Shri A.S. Didolkar, CMD, HOCL on
 31-8-2010, as per Govt. Order No. 51/14/2009-CH-lll dated 30th August,
 2010, and other subsequent Orders, Shri R.N.
 
 Madangeri, D(Tech) has assumed the additional charge of the office of
 Chairman & Managing Director, Hindustan Organic Chemicals Ltd. (HOCL)
 in addition to his duties and responsibilities as Director (Tech) up to
 31st May, 2011. Further in pursuance of Article 76(1) of the Articles
 of Association of HOCL vide Govt. Order No.
 
 51/14/2009-CH-lll dated 9th June, 2011, President has appointed Shri
 R.N. Madangeri, Director (Technical), HOCL as Chairman-cum- Managing
 Director,(CMD), HOCL for a period of 5 years from the date of
 assumption of charge on 9th June, 2011 or till date of his
 superannuation or till further order which ever is the earliest.
 
 The Tenure of other 2 Independent Directors viz. Mr. Madan Verma and
 Dr. N.J. Gaikwad (NOID) was expired on 7-1-2011.
 
 Later, during the Current Year 2011-12, Shri J.N. Suryawanshi,
 CGM(Marketing) HOCL, has been appointed as Director (Marketing) w.e.f.
 30/04/2011 vide GOI Order No. 51/05/2009-Ch-lll dated 30th April, 2011.
 
 In terms of Article 76(4) of the Articles of the Association of the
 Company, Government Directors, Shri S.C. Gupta, Joint Secretary and Dr.
 V. Rajagopalan, Additional Secretary and Financial Advisor, will retire
 at this 50th AGM in 2011. Company is awaiting for their re- appointment
 or for further orders on new appointment by the Govt.  of India
 
 ACKNOWLEDGMENT
 
 Your Directors gratefully acknowledge the valuable guidance, support
 and directions given by the Government of India. Your Directors also
 gratefully acknowledge the support and co-operation extended by the
 State Governments, by the valued and esteemed customers, shareholders,
 suppliers, bankers, Statutory / Internal / Cost and Tax Auditors,
 Bondholders, and Investors.
 
 Your Directors place on record their appreciation for the whole hearted
 efforts and contribution from all the employees and also acknowledge
 the support and co-operation of all the Workers'' Unions and Employees''
 Unions and their members for the smooth functioning of the Company''s
 operations.
 
                         For and on behalf of the Board of Directors of
 
                                    Hindustan Organic Chemicals Limited
 
 
 
 Place: Mumbai                                          R. N. Madangeri
 
 Date: 18th July, 2011                     Chairman & Managing Director