Nirma

The Directors are pleased to present the 28th Annual Report together
 with Audited Statement of Accounts of the Company for the year ended on
 31st March 2008.
 
                                                         Rs.in crores
 Financial Results                                2007-08     2006-07
 
 Turnover                                         2650.78     2541.05
 
 Profit for the year before providing 
 for the depreciation & taxation                   382.34      385.90
 
 Less Provision for depreciation                   226.65      207.51
 
 Add Provision for expenses 
 of earlier years written back                      70.89         Nil
 
 Less Provision for taxation - Current Tax          26.00       20.00
 
 Fringe Benefit Tax                                  0.40        0.50
 
 Deferred tax                                      (29.55)      48.77
 
 Profit after depreciation & taxation              229.73      109.12
 
 Add Provision of Taxation 
 Provided / earlier years written back             (12.18)     110.67
 
 Less Loss of Demerged 
 Undertaking for the prior period                     Nil      111.38
 
 Add Balance in Profit & Loss 
 Account brought forward                            71.13      135.65
 
 Profit available for Appropriation                288.68      244.06
 
 Less : Transferred to General Reserve             100.00      100.00
 
 Interim Dividend on Equity Shares                    Nil       63.50
 
 Dividend on new Equity shares 
 allotted pursuant to the
 Composite Scheme of Compromise and Arrangement       Nil        0.29
 
 Dividend on Preference Shares                       0.17        0.17
 
 Proposed Dividend on Equity Shares                 63.66         -
 
 Tax on dividend                                    10.85        8.97
 
 Balance carried to Balance Sheet                  114.00       71.13
 
 DIVIDEND
 
 Your Directors are pleased to recommend the dividend :
 
 i) on Preference shares @ 6% i.e. Rs.6/- per share on 279285 Redeemable
 Non cumulative Nor convertible Preference shares of Rs.100/- each
 absorbing Rs.0.20 crores including tax
 
 ii) on equity shares @ 80% i.e. Rs.4/- per share of Rs.5/- each
 absorbing Rs.74.48 crores including tax, for the financial year
 2007-08.
 
 ACQUISITION OF SEARLES VALLEY MINERALS INC.  & SEARLES VALLEY MINERALS
 OPEARTIONS INC.
 
 Your Directors are pleased to inform that the Company has successfully
 completed the acquisition of Searles Valley Minerals Inc. (SVM) and
 Searles Valley Minerals Operations Inc. (SVMO) (Collectively SVM) the
 USA based Soda Ash producer. The Company had entered into definitive
 agreement for the acquisition on November 27, 2007. SVM is the only
 producer of Soda Ash, Sodium borates, Boric acid and Sodium sulfate
 utilizing the solution mining technology. It has total production
 capacity over 1.9 million tonnes per annum.
 
 For acquisition of SVM, the Company has incorporated Karnavati Holdings
 Inc. (KHI) a corporation in the State of Delaware U.S.A. on November
 20, 2007 as Special Purpose Vehicle. The total cost of acquisition
 including net current assets of USD 225 million has been funded by
 combination of External Commercial Borrowings, direct investments and
 Gorporate Guarantees.
 
 With this acquisition your Company is now amongst the top rated
 Companies in manufacturing of Soda Ash and has started establishing a
 strong presence in the international market.
 
 BUSINESS OPERATIONS OVERVIEW
 
 The year under review has been eventful for your Company. After
 acquisition of Sachana undertaking of Core Healthcare Limited last
 year, the acquisition of SVM in the U.S.A., enabled the Company to have
 strong and strategic base as Soda Ash producing unit. Your Company
 being one of Indias leading manufacturer of Detergents & Soaps has
 already established its position in this segment.
 
 Your Company has been growing from strength to strength and taken
 challenges on the global stage. The benefit of acquisition and the
 results of initiatives taken by the company will accrue in foreseeable
 future.
 
 The Turnover during the year on standalone basis has marginally
 increased from Rs.2541.05 crores to Rs.2650.78 crores showing increase
 by Rs.109.73 crores. On consolidated basis, the turnover is Rs.3003.03
 crores during the year.  The operating profit before interest,
 depreciation and tax is Rs.390.26 crores during the year compared to
 Rs.379.38 crores of the previous year. The net profit has gone up to
 Rs.229.73 crores during the year under review. Volatility in the prices
 of some of the raw materials remained critical to the business. For
 detailed analysis and performance refer to the Management Discussion
 and Analysis section of the Annual Report.
 
 SHARE CAPITAL
 
 The Authorised Share Capital of the Company has increased from Rs.100
 crores to Rs.150 crores vide resolution passed through the exercise of
 postal ballot conducted pursuant section 192A of the Companies Act,
 1956 on 19th March 2008.
 
 PROJECTS
 
 Your Directors are pleased to state that the Company has completed the
 Pure Water Project in all respect and the plant commissioning trials
 started from February 2008. With the above Pure Water Plant Capacity
 has been increased from 2240 m3/day to 4480 m3/day and in turn vaccum
 salt capacity from 800 TPD to 1600 TPD.  The utility expansion for
 meeting pure water and caustic soda plant project is also on the verge
 of completion.  The caustic soda plant of 240 TPD which is being put up
 at Kalatalav site, Dist. Bhavnagar, is expected to commission by
 February 2009. The civil construction job for this plant has been
 completed by 60% and mechnical equipment erection has started.
 
 Your Company has also initiated a Cement Project at Tal. Mahuva Dist.
 Bhavnagar in Gujarat. The rated capacity of the plant will be 1.91
 million tonnes per annum while the capacity of Captive Power will be 50
 MW. The Company has already acquired the land at the plant site. The
 Government of Gujarat has sanctioned the supply of sweet water from
 Narmada pipeline.
 
 The major equipments pertaining to Cement Project have been ordered for
 and for remaining long delivery equipments the technical and commercial
 negotiations are under process.
 
 CORPORATE GOVERNANCE
 
 Your Company continues to commit good Corporate Governance vis-a-vis
 corporate practices by complying with various Standards prescribed by
 the Securities and Exchange Board of India vide Clause 49 of the
 Listing Agreement with the Stock Exchanges. Apart from mandatory
 requirements from Listing Agreement, the Company is also complying some
 of the non mandatory requirements to maintain high degree of
 Governance.  A separate report on Corporate Governance alongwith a
 certificate from the Auditors and Management Discussion and Analysis
 are annexed as part of the Annual Report.
 
 DIRECTORS
 
 Shri Rajendra D. Shah, Shri Rakesh K. Patel, and Shri Kaushik N. Patel
 Directors of the Company retire by rotation at the ensuing Annual
 General Meeting and are eligible for re-appointment. Your Directors
 recommend their re-appointment. None of the directors are disqualified
 from being appointed as director as specified in terms of Sections
 274(1) (g) of the Companies Act, 1956.  The information on the
 particulars of Directors seeking re-appointments and appointment as
 required under Clause 49 of the Listing Agreement executed with the
 Stock Exchanges, have been given alongwith the notice of the ensuing
 Annual General Meeting.
 
 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 preparation of the annual accounts for the financial year ended
 31st March, 2008, the applicable accounting standards have been
 followed alongwith proper explanations relating to material departures;
 
 (ii) Directors 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 as at 31st March 2008 and of the profit of the Company for
 the year ended on that date;
 
 (iii) Directors have taken proper and sufficient care for the
 maintenance of adequate accounting records in accordance with the
 provisions of the Companies Act, 195G for safeguarding the assets of
 the Company and for preventing and detecting fraud and other
 irregularities; and
 
 (iv) Directors have prepared the annual accounts of the Company on a
 going concern basis.
 
 SUBSIDIARY COMPANIES
 
 During the year under review, the Company has incorporated Karnavati
 Holdings Inc. (KHI) in the state of Delaware, United States of America,
 on November 20, 2007 as Wholly Owned Subsidiary of the Company and
 signed the share purchase agreements with KHI.  KHI incorporated
 Searles Valley Minerals Operations Acquisition Corporation and Searles
 Valley Minerals Acquisition Corporation in the state of Delaware, USA,
 which merged with and into Searles Valley Minerals Operations Inc
 (SVMO) and Searles Valley Minerals Inc.  (SVM) on 27th December 2007.
 Consequently, SVMO and SVM, the surviving corporations have become
 step- down subsidiaries of the Company.
 
 In terms of the approval granted to the Company by Ministry of
 Corporate Affairs, Government of India vide its letter No.
 47/495/2008-CL-lll dated 5th August 2008, the Company has been exempted
 from complying with the provisions of sub section (1) of section 212 of
 the Companies Act, 1956, for the financial year under review.
 
 Further SVMO wholly owns four entities in U.S.A.  namely Searles
 Domestic Water Company LLC, Searles Valley Residences LLC, Trona
 Railway Company LLC and NATI LLC, while NATI LLC has a 50 percent
 membership in Trona Export Terminals LLC in U.S.A.
 
 CONSOLIDATED FINANCIAL STATEMENTS The Consolidated Financial Statements
 pursuant to clause 41 of the Listing Agreement entered into with stock
 exchanges and prepared in accordance with Accounting Standard 21
 (consolidated financial statements) of Institute of Chartered
 Accountants of India, for the financial year ended March 31, 2008 is
 attached with this report. Further, the key financial information of
 the subsidiaries / entities have been disclosed in a brief abstract
 forming part of this Annual Report.  In the absence of control of Trona
 Export Terminals LLC, its operations are not included and considered
 for consolidation. The Annual Accounts of the subsidiary companies and
 related detailed information will be made available to any member of
 the Company seeking such information at any point of time. The Annual
 Accounts of the subsidiary companies will also be kept for inspection
 by any member at the Registered Office of the Company and that of
 subsidiary companies concerned.
 
 PARTICULARS OF EMPLOYEES
 
 In terms of the provisions of section 217(2A) of the Companies Act,
 1956, read with the Companies (Particulars of Employees) Rules, 1975 as
 amended, the names and other particulars of the employees are required
 to be set out in the annexure to the directors report. However, as per
 the provisions of section 219(1) (b)(iv) of the said Act, the annual
 report excluding the aforesaid information is being sent to all the
 members of the Company and others entitled thereto. Members who are
 interested in obtaining such particulars may write to the Company
 Secretary at the Registered Office of the Company.
 
 FIXED DEPOSITS
 
 During the year under review the Company has not accepted Public
 Deposits.
 
 DEPOSITORY SYSTEM
 
 As the members are aware, your Companys shares are compulsorily
 tradable 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) Ltd
 (CDSL). Members are requested to avail of the facility of
 dematerialization of the Companys shares on either of the depositories
 as aforesaid.
 
 In terms of the provisions of the Investor Education and Protection
 Fund Rules, 2001, Rs.1.10 lacs has been transferred to Investor
 Education and Protection Fund during the year under review.
 
 CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
 EARNINGS AND OUTGO
 
 The particulars as required u/s. 217(1)(e) of the Companies Act, 1956
 read with Companies (Disclosure of Particulars in the Report of Board
 of Directors) Rules, 1988 relating to conservation of energy,
 technology absorption and foreign exchange earnings and outgo are given
 in the Annexure forming part of this Report.
 
 AUDITORS & AUDITORS REPORT
 
 The Auditors of the Company M/s. Hemanshu Shah & Co., Chartered
 Accountants, Ahmedabad, hold office until the conclusion of the ensuing
 Annual General Meeting and are recommended for reappointment.
 Certificate from Auditors has been received to the effect that their
 reappointment if made, would be within the limits prescribed under
 section 224(1 B) of the Companies Act, 1956. Notes forming part of
 Accounts, which are specifically referred to by the auditors in their
 report are self-explanatory and therefore, do not call for any further
 comments.
 
 INSURANCE
 
 Assets of the Company are insured as required to be.
 
 ACKNOWLEDGEMENT
 
 Your Directors wish to place on record their appreciation of the
 continued co-operation and support given by the various Government
 authorities, institutions, bankers, business constituents and
 shareholders. Your Directors also wish to place on record their
 appreciation of the devoted services of employees at all levels who
 have largely contributed to the efficient management of the Company.
 
                                     For and on behalf of the Board
 
 Place  : Ahmedabad                                 Dr. K. K. PATEL
 Date   : August 19, 2008                                  Chairman