The Directors have pleasure in presenting the 48th Annual Report and
 Accounts for the year ended 31st March, 2012.
 
 FINANCIAL RESULTS
 
 The highlights of the financial results are as follows:
 
                                               Year ended    Year ended
                                               March 2012    March 2011
                                            (Rs. in Lacs) (Rs. in Lacs)
 
 Profit before taxation                             2,562         1.940 
 
 Less: Provision for taxation:
 
      Current tax                                     905           634
 
      Deferred tax                                   (98)            93
 
 Profit after tax                                   1,755         1.213
 
 Balance in Profit & Loss Account brought 
 forward from Previous Year                         3,173         2,404
 
 Profit balance available for appropriation         4,928         3.617
 
 Appropriations:
 
 Dividend including Proposed Dividend                 273           278
 
 Tax on dividend                                       43            44
 
 Transfer to General Reserve                          132           122
 
 Balance in Profit & Loss Account Carried
 Forward to Balance Sheet                           4,480         3.173
 
 OPERATIONS
 
 During the financial year ended 31st March, 2012, the net profit after
 tax of the company was Rs.1,755 lacs, an increase of 44.7 % over the
 previous year''s net profit after tax of Rs. 1,213 lacs. The turnover
 was higher at Rs. 673 crores as compared to Rs. 591 crores of the
 previous year, showing a increase of 14 %.
 
 DIVIDEND
 
 The Directors are pleased to recommend a dividend of Rs. 2.00 [20 %]
 per equity share for the financial year ended 3151 March, 2012.
 
 FUTURE OUTLOOK
 
 The continuing crisis in the Eurozone has not dampened the investments
 in water & environment management. The Indian Government continues to
 announce measures to improve the environmental health of the country
 and your company expects to benefit from it.
 
 However, the business confidence has been impacted by concerns on the
 economic front. This has resulted in a slight reduction in the pace of
 investments by the private sector in new projects. As mentioned earlier
 
 we expect the slack to be taken up by the increased public sector
 investments.
 
 Your Company will continue its endeavour to expand operations globally
 with focus on emerging economies. Joint ventures with the local players
 in such countries are under active consideration. We will also be
 looking at increasing our presence in the rural sector. This will be
 achieved through increased penetration and introduction of more
 products suited to the rural requirements.
 
 We continue to raise the bar of quality for our various products and
 production facilities with globally accepted quality certifications. In
 continuation of this endeavour our resin facility now has ISO 9000, ISO
 14000, Halal and WQA Gold Seal certifications. The new FDA compliant
 facility will also start operations shortly
 
 Price volatility in the cost of inputs continues to impact the margins.
 However, the timely measures taken by your Company has minimised the
 adverse impact to a large extent. It is expected that the volatile
 situation in the raw material costs will not change radically in the
 future.  We will continue to take proactive measures to effectively
 minimise the impact of price volatility.
 
 Your company''s emphasis on innovative technology, research &
 development and comprehensive product mix for environment management
 should ensure ability to counter uncertain business environment and
 report continuing improvement in performance.
 
 FINANCIAL RESOURCES Share Capital
 
 Under Employees Stock Option Scheme - ESOS - 2008, the Employees'' Stock
 Option Compensation Committee (ESOCC) allotted 1,31,950 equity shares
 [82,900 equity shares under ESOS - 2008], 4,000 equity shares under
 ESOS 2005 [9,500 equity shares under ESOS - 2005] to the directors and
 employees of the Company. The paid-up equity capital of the Company
 increased from Rs. 13,42,59,110/- to Rs. 13,56,18,610/- after
 allotment.
 
 Fixed Deposits
 
 As on 31st March, 2012, 123 fixed deposits amounting to Rs. 24,50,000/-
 remained unclaimed. 20 Deposits amounting to Rs. 4,84,000/- have been
 renewed / claimed since then. 
 
 EMPLOYEES'' STOCK OPTION SCHEMES
 
 The details of Employees'' Stock Option Schemes ESOS - 2001, ESOS
 - 2003, ESOS - 2005 and ESOS - 2008 as required to be given under SEBI
 (Employees Stock Option Scheme and Employees Stock Purchase Scheme)
 Guidelines, 1999, as amended, are given in the Report on Corporate
 Governance.
 
 RESTRUCTURING OF BUSINESS
 
 Pursuant to Board and Shareholders'' approval for the proposal to sell
 the Project Division (covering domestic turnkey projects) on a going
 concern basis to Ion Exchange Projects and Engineering Limited, a
 wholly owned subsidiary company, the Company is in the process of
 completing all the necessary formalities for the above mentioned
 proposal.
 
 SUBSIDIARY COMPANIES
 
 Aqua Investments (India) Ltd. and Watercare Investments (India) Ltd.
 
 During the year ended 31st March, 2012, the Subsidiary companies M/s.
 Aqua Investments (India) Limited posted profit of Rs. 8.29 lacs
 compared to Rs. 6.54 lacs of the previous year and M/s. Watercare
 Investments (India) Ltd. posted profit of Rs. 6.55 lacs compared to Rs.
 5.27 lacs of the previous year.
 
 Ion Exchange Enviro Farms Limited (IEEFL)
 
 The Company improved its performance by focusing on select Farms and
 Product groups. The operating income rose from Rs.78,48 lacs (2010-11)
 to Rs.108.26 lacs. However due to erratic climatic conditions & other
 local environmental factors the optimum operational performance could
 not be reached.
 
 Due to product improvement through R&D the sale of Farm Inputs (e.g.
 ENVIRO REACH) has increased from Rs.52 lacs to Rs.75 lacs in the
 current year. The Company expects to enter into new geographies and
 also new market segments like chilli & other vegetables which will
 increase the turnover substantially.
 
 Ion Exchange Infrastructure Limited
 
 The Company achieved turnover of Rs. 4,498.34 lacs as compared to Rs.
 3,846.93 lacs for the previous year. The profit after tax was at Rs.
 10.71 lacs compared to Rs.14.09 lacs for the previous year.
 
 The Company has been established with a view to undertake projects for
 intake water, water treatment, distribution and waste management on
 lumpsum turnkey basis. The Company will also provide comprehensive
 technical and process assistance services such as consultancy, design,
 detailed engineering and turnkey contracting.
 
 Ion Exchange Asia Pacific Pte Ltd., Singapore and Ion Exchange Asia
 Pacific (Thailand) Ltd., Thailand
 
 The Company achieved a consolidated turnover of Rs. 843.72 lacs for the
 year under review as compared to 1,410.95 Lacs for the previous year.
 The performance of the Company was adversely affected due to uncertain
 economic conditions in South East Asia & resultant deferment of capital
 expenditure by customer.
 
 IEI Environmental Management [MJ SDN. BHD, Malaysia
 
 The Company achieved a turnover of Rs. 42.44 lacs for the year under
 review.
 
 The Company''s main activity is trading in water filtration equipments,
 water chemicals, resins and taking up projects of installing water
 filtration plants of any nature. The Company has been established with
 a view of facilitating operations in Malaysia and is a strategic
 investment which would be crucial for increasing the overall Exports to
 the country.
 
 Ion Exchange Environment Management (BD) Limited, Bangladesh The
 Company achieved a turnover of Rs. 550.29 lacs for the year under
 review.
 
 The Company is set up with a view to strengthen and widen the
 Company''s presence in the Bangladesh market.
 
 After the successful commissioning of assembly shop in Bangladesh, the
 local business has shown good growth in turnover and this enabled the
 Company to maintain profit. The Company''s major focus has been waste
 water treatment plants and chemicals in Bangladesh market.  The Company
 plans to enter into infrastructure projects in Bangladesh
 
 Ion Exchange WTS (Bangladesh) Limited, Bangladesh
 
 At present there are no activities in this company. Various options are
 being explored for streamlining and consolidating the activities of
 this company along with other wholly owned subsidiery company in
 Bangladesh viz: Ion Exchange Environment Management (BD) Limited.  
 
 Ion Exchange & Co. LLC, Oman
 
 The Company achieved a turnover of Rs. 39.74 crores for the year under
 review.
 
 The Company is set up to address the needs of Middle East market
 especially Oman.
 
 The Company is approved by PDO (OMAN). The Company has performed well
 during the year under review and has declared interim dividend of 60%.
 The Company has secured two big orders from local petroleum company and
 European EPC contractor in Oman. One of these jobs, is a 7 years O&M
 contract for five sea water plants. In order to handle the O&M
 contract, the company is expanding employee strength which will also be
 beneficial for further business generation.  
 
 Ion Exchange LLC, USA
 
 The Company achieved a turnover of Rs. 17.09 crores for the year under
 review.
 
 
 This subsidiary is established to address the needs of US market. The
 Company''s operations will substantially benefit and address the
 parent company''s needs in the US.
 
 In spite of slow economic recovery in USA the Company was able to
 increase the resin sales business in USA. The Company expects that the
 growth will continue in the current financial year.
 
 Ion Exchange Projects and Engineering Limited
 
 The Company was incorporated on 9th April, 2012. Pursuant to Board and
 Shareholders'' approval for the proposal to sell the Project Division
 (covering domestic turnkey projects) on a going concern basis to Ion
 Exchange Projects and Engineering Limited, the Company is in the
 process of completing all the necessary formalities to implement the
 proposal.
 
 Global Composites and Structural''s Limited
 
 The Company achieved a turnover of Rs. 23 crores for the year under
 review.
 
 The Company is in the business of providing integrated engineering
 services across the life cycle of a project and has expertise in
 manufacture of RO Pressure Tubes and FRP Tanks and electrical load
 distribution for water treatment Industries.
 
 A statement as required under Section 212 of the Companies Act, 1956,
 is attached to the Annual Report.
 
 In accordance with the general circular issued by the Ministry of
 Corporate Affairs, Government of India, the Balance Sheet. Profit and
 Loss Account and other documents of the subsidiary companies are not
 being attached with the Balance Sheet of the Company. The Company will
 make available the Annual Accounts of the subsidiary companies and the
 related detailed information to any member of the Company who may be
 interested in obtaining the same. The annual accounts of the subsidiary
 companies will also be kept open for inspection at the Registered
 Office of the Company and that of the respective subsidiary companies.
 The Consolidated Financial Statements presented by the Company include
 the financial results of its subsidiary companies.
 
 CONSOLIDATED FINANCIAL STATEMENTS
 
 As required by Accounting Standard 21 ''Consolidated Financial
 Statements'' issued by the Institute of Chartered Accountants of India,
 the audited Consolidated Financial Statements of the Group are
 enclosed.
 
 DIRECTORS
 
 Mr. Akhil Marfatia, Mr. Shishir Tamotia and Mr. M. P. Patni retire by
 rotation and being eligible offer themselves for re-appointment.
 
 DIRECTORS'' RESPONSIBILITY STATEMENT
 
 Pursuant to the requirement under Section 217(2AA) of the Companies
 Act, 1956 with respect to Directors'' Responsibility Statement, it is
 hereby confirmed that:
 
 (i) in the preparation of the annual accounts for the year ended 31st
 March, 2012, the applicable accounting standards have been followed
 along with proper explanation given relating to material departures;
 
 (ii) appropriate accounting policies have been selected and applied
 consistently and judgments and estimates were made that were 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 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 Companies
 Act, 1956. for safeguarding the assets of the Company and for
 preventing and detecting fraud and other irregularities have been taken
 to the best of their knowledge;
 
 (iv) the annual accounts have been prepared for the financial year
 ended 31st Marcti, 2012 on a going concern basis.
 
 CORPORATE GOVERNANCE
 
 A report on Corporate Governance as required under Clause 49 of the
 listing agreement forms part of this annual report.
 
 MANAGEMENT DISCUSSION AND ANALYSIS REPORT
 
 Report on Management discussion and analysis as required under Clause
 49(V) of the listing agreement forms part of this annual report.
 
 CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
 EARNINGS & OUTGO
 
 Information in accordance with 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 and forming part of this Report for
 the year ended 31st March, 2012 is given in Annexure I.
 
 PARTICULARS OF EMPLOYEES
 
 The details required to be given under Section 217(2A) of the Companies
 Act, 1956, read with the Companies (Particulars of Employees) Rules,
 1975, as amended are given in Annexure forming part of this report. In
 terms of section 219 (1) (b) (iv) of the Act, the Report and Accounts
 are being sent to the shareholders excluding the aforesaid Annexure.
 Any shareholder interested in obtaining a copy of the same may write to
 the Company Secretary.
 
 QUALITY INITIATIVES
 
 In line with Management''s commitment to Safety, Occupational Health
 System is successfully implemented at company''s chemical division by
 integrating the same with the existing Quality Management System in
 accordance with ISO 9001: 2008 and Environmental Management System in
 accordance with ISO 14001:2004.
 
 Company''s Resin Division applied for FICCI Quality Award 2011 with the
 objective of benchmarking our quality initiatives and performance with
 other leading organisations. Evaluation criteria for the award focus on
 Commitment to Quality Systems at work place and its adoption for
 effectiveness. The Quality processes of the company were appreciated by
 FICCI, when they awarded ''Certificate of Appreciation'' after critical
 evaluation of the ''Application Report'' and subsequent site visit to
 the manufacturing facility.
 
 Balanced Scorecard, the tool used for implementation of formulated
 strategies is now internalized effectively.
 
 All other initiatives such as Quality improvement projects to solve
 chronic problems, monitoring of Quality Objectives, System Audits of
 Marketing, Execution, Projects and O&M sites continue.
 
 AUDITORS
 
 The Statutory Auditors. M/s. S. R. Batliboi & Co. hold office until the
 conciusion of this meeting and are eligible for re-appointment. The
 Company has received letter from M/s. S. R. Batliboi & Co.. to the
 effect that their re-appointment, if made, would be within the limits
 specified under section 224(1 B) of the Companies Act, 1956.
 
 ACKNOWLEDGEMENTS
 
 Your Board conveys its deep appreciation of the co-operation extended
 by customers, suppliers, banks, financial institutions, contribution
 made by employees for the company''s growth, shareholders and fixed
 deposit holders.
 
                                   On behalf of the Board of Directors
 
                                                         Rajesh Sharma
 
                                                              Chairman
 
 Mumbai
 
 Date : 25th May. 2012