The Directors have pleasure in presenting the Twenty Sixth Annual
 Report on the Business of the Company and the Audited Statements of
 Accounts for the year ended 31st March, 2012 and Auditors report
 thereon.
 
 OPERATIONS:
 
 The Company has achieved a turnover of Rs 480.00 Crores during the
 current year 2011-12, as against Rs 328.15 Crores during the previous
 year. The exports during the year has also increased from Rs 315.63
 Crores during the previous year to Rs 416.22 Crores during the year
 2011-12 registering a growth of 31%. The order book position as on 31st
 March, 2012 is Rs 268 Crores out of which export orders account for Rs
 200 Crores.
 
 During the year 2011-12 the Company has successfully implemented the
 Expansion Project of New Heat Treatment and End Finishing Facility and
 the Commissioning will be completed by May, 2012, thereby increasing
 the manufacturing capacity by 150,000 MT and the overall capacity will
 be 250,000 MT.
 
 FINANCIAL RESULTS:
 
                                        2011-2012          2010-2011
 S.No                                  (Rs. In Lakhs)     (Rs. In Lakhs)
 
 1    Gross Income                       47999.67           32815.32
 
 2    Profit Before Interest and
      Depreciation                        7838.55            6303.97
 
 3    Finance Charges                     1148.50             880.89
 
 4    Gross Profit                        6690.05            5423.08
 
 5    Provision for Depreciation          1038.62             846.22
 
 6    Net Profit before tax               5651.43            4576.86
 
 7    Provisions For Tax                  1823.93            1529.47
 
 8    Net Profit after tax                3827.50            3047.39
 
 9    Balance of Profit brought 
      forward                              285.76             267.86
 
 10   Balance available for 
      appropriation                       4113.26            3315.25
 
 11   Proposed Dividend on 
      Equity Shares                        885.79             885.79
 
 12   Tax on proposed Dividend1             43.70             143.70
 
 13   Transfer to General Reserves        2700.00            2000.00
 
 14   Surplus carried to Balance Sheet     383.77             285.76
 
 Dividend:
 
 The Board of Directors of the Company are pleased to recommend dividend
 of Rs 2/- for each Equity Share of Rs10/- each on the Equity Share
 Capital of the Company for the Financial Year ended 31st March, 2012
 subject to approval of the Shareholders in the Annual General Meeting.
 
 PROSPECTS:
 
 With the growing demand of the Company''s products due to increase in
 the Oil and Gas Exploration Activities, the Company has targeted a
 turnover of Rs 600 Crores during the year 2012-13.
 
 MANAGEMENT DISCUSSION AND ANALYSIS REPORT:
 
 As required by Clause 49 of the Listing Agreements with Stock
 Exchanges, the Management discussion and Analysis Report is enclosed as
 a part of this report (Annexure-1).
 
 LISTING WITH STOCK EXCHANGES:
 
 The Company confirms that it has paid the Annual Listing Fees for the
 year 2012-2013 to NSE and BSE, where the Company''s Shares are listed.
 
 DEMATERIALISATION OF SHARES:
 
 90.19 % of the company''s paid up Equity Share Capital is in
 dematerialized form as on March 31st, 2012 and balance 9.81 % is in
 physical form.
 
 The Company''s Registrars are M/s XL Softech Systems Ltd., 3 Sagar
 Society, Road No.2, Banjara Hills, Hyderabad - 500 034.
 
 DIRECTORS:
 
 Dr. T S Sethurathnam retires on rotation and being eligible offer
 himself for re - appointment.
 
 Mr. K V Ravindra Reddy retires on rotation and being eligible offer
 himself for re - appointment.
 
 Mr. A P Vitthal Additional Director, appointed by the Board ceases to
 be a director at this Annual General Meeting.  A notice was received
 from a shareholder for his appointment as director along with a deposit
 of Rs 500/- as required U/s 257 of the Companies Act, 1956.
 
 The Directors recommend appointment / reappointment as proposed in the
 notice for the Annual General Meeting.
 
 THE DIRECTOR''S RESPONSIBILITY STATEMENT (UNDER SECTION 217 (2AA) OF
 COMPANIES ACT, 1956)
 
 To the best of their knowledge and belief and according to the
 information and explanations obtained by them, your Directors make the
 following Statement in terms of Section 217 (2AA) of the Companies Act,
 1956.
 
 1.  That 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 relating to material departures, if any.
 
 2.  That such accounting policies as mentioned in Notes on Accounts
 have been selected and applied consistently and judgments and estimates
 that are reasonable and prudent made so as to give a true and fair view
 of the State of affairs of the Company at the Financial year 31st
 March, 2012 and of the profit of the Company for that year.
 
 3.  That proper and sufficient care has been taken for 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.
 
 4.  That the Annual Accounts for the year ended 31st March, 2012 have
 been prepared on a going concern basis.
 
 AUDITORS:
 
 The Auditors of the Company, M/s C K S Associates, Chartered
 Accountants, Hyderabad retire at the ensuing Annual General Meeting and
 are eligible for reappointment.
 
 Auditors'' observations are suitably explained in notes to the Accounts
 and are self-explanatory.
 
 CORPORATE GOVERNANCE:
 
 Your Company is committed to maintain standards of good corporate
 governance and has taken adequate steps to adhere to all the
 stipulations laid down in Clause 49 of the Listing Agreement. Report on
 Corporate Governance along with the Certificate of the Auditors M/s C K
 S Associates confirming compliance of conditions of Corporate
 Governance form part of the Annual Report. (Annexure-II)
 
 CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE
 OUTGO:
 
 Information required under Section 217 (1) (e) of the Companies Act,
 1956 read with Companies (Disclosure of particulars in Directors''
 Report) Rules 1988 is given in the Annexure forming part of this report
 (Annexure-III).
 
 PERSONNEL:
 
 The Company had 7 persons, who were in receipt of remuneration of not
 less than Rs 24,00,000 during the year ended 31st March, 2012 or not
 less than Rs 2,00,000 per month during any part of the said year.
 
 However, as per the provision of Section 219 (1) (b) (IV) of the
 Companies Act, 1956, the Director''s Report and Accounts are being sent
 to all the Shareholders excluding the statement of particulars of
 employees. Any shareholder interested in obtaining a copy of the
 statement may write to the Company Secretary of the Company.
 
 During the year under review, relationship with the employees is
 cordial.
 
 ACKNOWLEDGEMENT:
 
 Directors take this opportunity to express their thanks to various
 departments of the Central and State Government, ONGC, Oil India
 Limited, Multinational Companies operating in India and Abroad for Oil
 and Gas Exploration Activities, Financial Institutions, Bankers,
 Material Suppliers, Customers and Shareholders for their continued
 support and guidance.
 
 The Directors wish to place on record their appreciation for the
 dedicated efforts put in by the employees of the Company at all levels.
 
 Read. Office :              For and on behalf of the Board of Directors
 
 Karnineni, 3rd Floor
 
 King Koti
 
 Hyderabad - 500 001 (A.P)                    K. SURYANARAYANA
 
 April 26th 2012                                  Chairman