The Directors have pleasure in presenting 20th Annual Report together
 with the Audited Annual Accounts for the year ended 31st March, 2011.
 
 FINANCIAL PERFORMANCE
 
 The financial results of the Company for the financial year 2010-2011
 as compared with the previous year are as follows -
 
                                                     (Amount in Rupees)
 
                                         2010 - 2011       2009 - 2010
 
 Sales and other Income               10,937,387,964     8,172,140,511
 
 Profit before tax                       718,858,863       702,633,800
 
 Provision for tax 
 (including Deferred Tax)                235,564,613       211,954,791
 
 Profit after tax                        483,294,250       490,679,009
 
 Balance of Profit brought forward 
 from previous year                      540,908,853       298,584,683
 
 Profit available for appropriation    1,024,203,103       789,263,692
 
 APPROPRIATIONS
 
 Your Directors propose to appropriate the Profit as under : 
 
 Excess provision for previous years written back
 
 a) Dividend                            (64,481,359)      (32,246,635)
 
 b) Tax on Dividend                     (11,488,953)       (5,480,315)
 
 Proposed Dividend                       201,787,930       201,787,930 
 
 Tax on Dividend                          32,735,047        34,293,859 
 
 Transfer to General Reserve              50,000,000        50,000,000 
 
 Balance carried to Balance Sheet        815,650,438       540,908,853
 
 
 DIVIDEND
 
 Your Directors have recommended a dividend of 20 percent (Re. 1 per
 Equity share).
 
 
 G.  Internal Control Systems and their adequacy
 
 The Company has a proper and adequate system of controls in order to
 ensure that all assets are safeguarded against loss from unauthorised
 use or disposal. All transactions are properly checked, verified,
 recorded and reported correctly.
 
 Regular Internal Audit checks are carried out to ensure that the
 responsibilities are executed effectively and that proper and adequate
 systems are in place.
 
 H.  Safety, Health and Environment
 
 Your Company is giving utmost importance to safety, health and
 environment related issues. The employees are continuously educated and
 trained to improve their awareness and skills.
 
 All safety statutory requirements like licenses, mock drills under
 emergency conditions and testing of lifting tackles and pressure
 vessels, etc. are being complied with. As a proactive approach,
 periodical safety audit is conducted to identify and eliminate possible
 potential causes of accidents.
 
 Medical check up for the employees is being conducted at the
 pre-employment stage and thereafter at regular intervals during the
 continuance of the employment period. Based on the medical reports of
 the employees, necessary measures are taken to improve the health
 condition of the employees. Your Company has appointed a full time
 Doctor and qualified nurses for the Occupational Health Centre, which
 caters to the medical needs of the employees.
 
 Your Company is certified for Quality Management Systems under ISO TS
 16949:2009, Environmental Management System under ISO 14001:2004 and
 also certified for Occupational Health & Safety Assessment Series
 (OHSAS 18001:2007) by Indian Register Quality Systems (IRQS). Quality
 Management Systems, Environmental Management System and Occupational
 Health & Safety Assessment Series have been integrated and came into
 effect from 14th January, 2011.
 
 Requirements of environmental acts and regulations are complied with.
 Monitoring and analysis of waste water, stack emissions and ambient air
 quality are undertaken periodically to verify whether the level of
 environmental parameters are well within the specified limits.
 
 Effluent treatment of waste products and suppression of fugitive
 emissions through sprinklers is also carried out effectively.
 Plantation of about 30,000 trees was undertaken during the year
 2010-11, to improve the greenery all around the plant. To reduce dust
 emission during operation of Raw Material Handling Section, water
 sprinkling arrangement has been made.
 
 Sewage Treatment Plant (STP) with 250 KLD (kilo liters per day)
 capacity is operated to treat domestic wastewater with extended
 biological aeration system. Sludge generated from STP is being used as
 manure for garden and treated wastewater used for gardening within the
 plant premises.
 
 Moreover, under ISO: 14001 and OHSAS: 18001, Management System, the
 following programs have been taken up and completed during 2010-2011 —
 
 1.  Magnetic separator provided at the shake out section of the
 Foundry, to bring down dust level.
 
 2.  To reduce stress to eye, 180 Cathode Ray Tube monitors were
 replaced with TFT monitors.
 
 3.  To eliminate electrocution in wet areas, portable torches are
 provided instead of 230 Volt hand lamps.
 
 4.  To eliminate fatigue at Core Shop Foundry Unit during trolley
 handling, polyurethane flooring has been provided.
 
 5.  Installation of Power Plant- 3 of capacity of 4.5 MW has helped in
 fully utilizing Blast Furnace gas for Power Generation, instead of
 flaring. Also this would result in bringing down contribution to GHG
 (Green House Gas) emissions into the atmosphere.
 
 6.  Environment concern has been reduced by achieving reduction of
 ungranulated slag generation from 20 percent to 4 percent through
 modification of launder inclination.
 
 I.  Social Responsibility
 
 As a part of its corporate responsibility to the society, your Company
 has taken following measures :
 
 (i) Under World Bank Scheme “Jala Nirmala Yojana” contribution given
 for drinking water facility to nearby village – Kampasagar.  
 
 (ii) Contributed to educational institutions at Koppal, Hitnal and
 Mundargi.
 
 (iii) Provided writing desks for school at Bevinahalli.
 
 (iv) Organised energy conservation training programmes for school
 children.
 
 (v) Scholarship awards to meritorious students of employees children
 studying in professional and diploma courses.  
 
 (vi) Conducted spoken English training programmes for college
 students at Bevinahalli village.
 
 (vii) Visit by specialist doctors to Bevinahalli village once a week.
 
 (viii) Conducted blood donation programmes and check up camp for
 critical illness at Bevinahalli village.  
 
 (ix) Construction of toilets to improve health and hygiene of
 people in neighbouring villages.
 
 J.  Human Resources
 
 Your Company considers human resource to be an important valuable asset
 for the organisation and therefore, constantly strives to attract and
 recruit best talent for the current and future needs.
 
 The Company has taken following initiatives –
 
 (i) Necessary steps to upgrade the skills of present employees by
 conducting various in-house training programs and courses.
 
 (ii) Working on Gallop survey feedback and implementing suggestions at
 all levels.
 
 (iii) Review of HR policy based on Company plans and people feedback.
 
 (iv) Monitoring effectiveness of training module / programme.
 
 (v) Offering career growth at all levels.
 
 (vi) Conducting programs on safety and mock drills.
 
 As on 31st March, 2011 the total number of salaried employees stood at
 1,207.  The Employer - Employee Relations have been generally cordial
 throughout the year.
 
 WARRANTS CONVERSION IN TERMS OF THE LETTER OF OFFER DATED 2ND JANUARY,
 2007
 
 The warrant exercise period has commenced on 13th March, 2008. In terms
 of the Letter of Offer dated 2nd January, 2007, each detachable warrant
 can be converted into one equity share of Rs. 5 each fully paid at a
 warrant exercise price Rs. 35 per warrant during the warrant exercise
 period.
 
 The warrantholders at their meeting held on 14th August, 2009 have
 extended the validity of warrant exercise period by a period of three
 years from 13th March, 2010 till 13th March, 2013.
 
 During the financial year 2010 - 2011, the Company received
 applications from warrantholders for conversion of 2,225 warrants into
 equity shares for an amount aggregating to Rs. 77,875 (inclusive of
 securities premium). 2,225 warrants amounting to Rs. 77,875 have been
 converted into 2,225 equity shares of Rs. 5 each (Equity share capital
 Rs. 11,125 and securities premium Rs. 66,750).
 
 DIRECTORS
 
 Mr. Atul C. Kirloskar, Mr. S. N. Inamdar and Mr. C. V. Tikekar retire
 by rotation and being eligible, offer themselves for re-appointment.
 
 DIRECTORS RESPONSIBILITY STATEMENT
 
 Pursuant to the requirements under Section 217(2AA) of the Companies
 Act, 1956, with respect to Directors Responsibility Statement, it is
 hereby confirmed :
 
 i.  That in the preparation of the Accounts for the financial year
 ended 31st March, 2011 the applicable accounting standards have been
 followed;
 
 ii.  That the Directors have selected such accounting policies and
 applied them consistently and made judgments and estimates that were
 reasonable and prudent so as to give a true and fair view of the state
 of affairs of the Company as at 31st March, 2011 and of the profit of
 the Company for the year ended 31st March, 2011; 
 
 iii.  That the Directors 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;
 
 iv That the Directors have prepared the accounts for the year ended
 31st March, 2011 on a going concern basis.
 
 CASH FLOW STATEMENT
 
 A Cash Flow Statement for the year ended 31st March, 2011 is attached
 with the Annual Audited Accounts of the Company.
 
 AUDITORS
 
 M/s P.G. Bhagwat, Chartered Accountants, retire as the Auditors at the
 conclusion of the ensuing Annual General Meeting, and being eligible,
 offer themselves for re-appointment. The Company has received a
 certificate from the retiring auditors to the effect that the
 appointment, if made, will be in accordance with the limit specified in
 Section 224(1B) of the Companies Act, 1956.
 
 The Board has recommended their re-appointment.
 
 ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
 EARNINGS AND OUTGO
 
 Details of Energy Conservation, Technology Absorption, Research and
 Development 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 the Board of Directors)
 Rules, 1988 are given in the Annexure - A and forms part of this
 Report.
 
 PARTICULARS OF EMPLOYEES
 
 Information regarding employees in accordance with Section 217(2A) of
 the Companies Act, 1956 read with the Companies (Particulars of
 Employees) Rules, 1975 is given in Annexure - B and forms part of this
 report.
 
 CORPORATE GOVERNANCE
 
 The Company conforms to the norms of Corporate Governance as envisaged
 in the Companies Act, 1956 and the Listing Agreement with the Bombay
 Stock Exchange Limited. Pursuant to Clause 49 of the Listing Agreement,
 a Report on the Corporate Governance and the Auditors Certificate on
 Corporate Governance are annexed to this report.
 
 APPRECIATION
 
 Your Directors wish to place on record their appreciation towards the
 contribution of all the employees of the Company and their gratitude to
 the Companys valued customers, bankers, financial institutions,
 vendors and members for their continued support and confidence in the
 Company.
 
                          For and on behalf of the Board of Directors
 
                                                    ATUL C. KIRLOSKAR 
                                                             Chairman
 
 Pune : 26th April, 2011