A.  Accounting Convention
 
 The financial statements are prepared under historical cost convention
 on accrual basis in accordance with the mandatory accounting standards
 read with notes and relevant presentational requirements of the
 Companies Act, 1956.
 
 B.  Investments
 
 Long term investments are stated at cost less provision, if any, for
 diminution in value of such investments other than temporary. Current
 investments are stated at lower of cost and fair value.
 
 C.  Fixed Assets
 
 a) Fixed assets are shown at cost less accumulated depreciation.
 
 b) Depreciation on fixed assets is provided on Straight Line Method
 (SLM) at rates specified in Schedule XIV to the Companies Act, 1956.
 
 c) No depreciation is provided on fixed assets held for disposal and
 shown under current assets at estimated realizable value.
 
 D.  Inventories
 
 Inventories are valued at cost or net realizable value whichever is
 lower. The cost is determined on FIFO basis.
 
 E.  Interest
 
 Interest on securities (other than fixed deposits with banks)
 pledged/deposited with the Government Departments is accounted for on
 cash basis.
 
 F.  Recognition of Income & Expenditure
 
 a) Brokerage, Service Tax, Education Cess and Securities Transaction
 Tax to the extent not available as rebate under Income Tax Act, 1961 on
 purchase/sale of shares and other securities are charged directly to
 Profit & Loss Account.
 
 b) Provision for loss in respect of Open Equity Derivative Instruments
 as at the Balance Sheet date is made Index-wise/Scrip-wise. As a matter
 of prudence, any anticipated profit is ignored.
 
 G.  Provision
 
 A provision is recognized when the company has a present obligation as
 a result of past events and it is probable that an outflow of resources
 will be required to settle such obligation, in respect of which a
 reliable estimate can be made.
 
 H.  Contingent Liabilities
 
 Contingent liabilities not provided for in the accounts are separately
 disclosed in the Notes to Accounts.
 
 I.  Employee Benefits
 
 i Long Term Employee Benefits
 
 a) Defined Contribution Plans
 
 The company''s contribution to defined contribution plans is charged
 to Profit & Loss Account as incurred.
 
 b) Defined Benefit Plans
 
 Defined Benefit Plan is provided on the basis of valuation as at the
 balance sheet date carried out by independent actuary. The actuarial
 valuation method used by independent actuary for measuring the
 liability is the Projected Unit Credit Method.
 
 c) Other Long Term Employee Benefits
 
 Other long term benefit is provided on the basis of valuation as at the
 date carried out by independent actuary. The actuarial valuation method
 used by independent actuary for measuring the liability is the
 Projected Unit Credit Method.
 
 ii Actuarial gains and losses comprise experience adjustments and the
 effects of the changes in actuarial assumptions are recognized
 immediately in the Profit & Loss Account as income or expense.
 
 iii Employee benefits which fall due wholly within twelve months after
 the end of the period in which the employees render the related service
 are recognized at the amount expected to be paid for it.
 
 J. Foreign Exchange Transactions
 
 Transactions in foreign currencies are recorded at the exchange rate
 prevailing on the date of the transaction. Liability / receivables on
 account of foreign currency are converted at the exchange rates
 prevailing as at the end of the year and gains / losses thereon are
 taken to the Profit & Loss Account.
 
 K. Earnings per share
 
 The earnings considered in ascertaining the Company''s EPS comprises
 the net profit after tax. The number of shares used in computing Basic
 EPS is the weighted average number of shares outstanding during the
 year. The number of shares used in computing Diluted EPS comprises of
 weighted average shares considered for deriving Basic EPS, and also the
 weighted average number of equity shares which could have been issued
 on the conversion of all dilutive potential equity shares.
 
 L. Use of estimates
 
 The preparation of financial statements requires estimates and
 assumptions to be made that affect the reported amount of assets and
 liabilities on the date of the financial statements and the reported
 amount of revenues and expenses during the reporting period. Difference
 between the actual results and estimates are recognized in the period
 in which the results are known / materialized.