The Directors are pleased to present the 25th Annual Report and the
 Audited Statements of Accounts for the year ended 31st March, 2011.
 
 Financial Results
 
 In the year under review, your Company has recorded a total income of Rs.
 5820 million (previous year Rs. 6447 million). While the total income
 decreased by 10% Profit before Tax decreased by 54% to Rs.599 million
 (previous year Rs. 1231 million). The performance was impacted by adverse
 global market conditions.
 
                                                       (Rs. in million)
 
                                            2010-11          2009-10
 
 Turnover                                      5529             6023
 
 Other Income                                   291              424
 
 Total Income                                  5820             6447
 
 Total Expenses                                5220             5216
 
 PBT                                            599             1231
 
 PAT                                            535             1139
 
 (+) Balance in Profit & Loss account         3252             2538
 
 Profit Available for Appropriations          3787             3677
 Appropriations
 
 -    Dividend
 
 Interim                                        -                266
 
 Final (Proposed)                               233               -
   Dividend Tax                                  38               45
 
 -    Transfer to General Reserve                54              114
 Balance in Profit and Loss Account           3462             3252
 
 Dividend
 
 Your Board of Directors decided to recommend a dividend of Rs. 1.26 per
 equity share (63%) of face value of Rs. 2/- each for the Financial Year
 ended 31st March, 2011.
 
 Credit Rating
 
 a) CRISIL has reaffi rmed P1+ rating to Companys short-term banking
 facilities which signifi es that the degree of safety regarding timely
 payment of instruments is very strong.
 
 b) CRISIL has also reaffi rmed its rating of the Companys long-term
 bank facilities to AA/Stable.  The AA rating signifi es high safety
 with regard to timely payment of long-term fi nancial obligations.
 
 Subsidiaries
 
 Pacecon Engineering Projects Ltd. (PEPL), BioCnergy Europa B. V.,
 Netherlands, Praj Jaragua Bioenergia S.A., Brazil, Praj Americas Inc.,
 Texas, Houston and Praj Far East Co. Ltd., Thailand are subsidiaries of
 your Company and are operating in their respective areas.
 
 Your Company has received approval from the Ministry of Corporate
 Affairs, Government of India under Section 212 (8) of the Companies
 Act, 1956 exempting it from attaching various documents in respect of
 subsidiary companies, as set out under Section 212 (1) of the Companies
 Act, 1956, to the Annual Accounts of your Company, for the Financial
 Year ended 31st March, 2011. As per the terms of the letter, a
 statement containing brief fi nancial details of the Companys
 subsidiaries for the year
 
 ended 31st March, 2011 is included in the annual report. The annual
 accounts of these subsidiaries and the related detailed information
 will be made available to any member of the Company and its
 subsidiaries at any point of time upon request. The same will also be
 made available for inspection by any member of the Company / its
 subsidiaries at the registered offi ce of the Company.
 
 Strategic Partnership / Joint Ventures
 
 Your Company has entered into a strategic partnership with Qteros Inc.,
 USA to accelerate commercialization efforts for industrial-scale
 cellulosic ethanol production. (Please refer to Annexure 1 for more
 details.)
 
 Corporate Governance
 
 Pursuant to Clause 49 of the Listing Agreement with the Stock
 Exchanges, Management Discussion and Analysis Report (Annexure 1),
 Sustainability Report (Annexure 2) and Report on Corporate Governance
 and Compliance Certifi cate on Corporate Governance (Annexure 3) are
 annexed to this report.
 
 Directors
 
 Ms. Parimal Chaudhari and Mr. Sivaramakrishnan Iyer, Directors, retire
 from the Board by rotation and being eligible, offer themselves for
 re-appointment at the ensuing Annual General Meeting.
 
 Mr. Prakash Kulkarni, who was appointed on 11th October, 2010 in the
 casual vacancy caused by the resignation of Mr. Anil Joshi, holds offi
 ce upto the date of the forthcoming Annual General Meeting.  The
 Company has received Notice in writing along with requisite deposit
 from a member under Section 257 of the Companies Act, 1956 proposing
 candidature of Mr. Prakash Kulkarni for the offi ce of Director liable
 to retire by rotation.
 
 During the year, Mr. Shashank Inamdar stepped down as CEO & Managing
 Director of the Company effective 15th November, 2010 and subsequently
 resigned from the offi ce of additional director with effect from 3rd
 February 2011. The Board placed on record its appreciation for the
 valuable contribution made by Mr. Inamdar during his tenure with the
 Company.
 
 Mr. Gajanan Nabar was appointed as an Additional Director of the
 Company with effect from 15th November, 2010. He was also appointed as
 CEO & Managing Director of the Company. A detailed profi le of Mr.
 Nabar is forming part of Corporate Governance Report. In terms of
 Section 260 of the Companies Act, 1956 he shall hold offi ce upto the
 date of the ensuing Annual General Meeting.  The Company has received
 Notice in writing along with requisite deposit from a member under
 Section 257 of the Companies Act, 1956 proposing candidature of Mr.
 Gajanan Nabar for the offi ce of Director not liable to retire by
 rotation.
 
 Mr. Pramod Chaudhari, Promoter Director, continues to lead as Executive
 Chairman of the Company.
 
 Auditors
 
 a) Internal Auditors
 
 The Internal Auditors, M/s. Khare Deshmukh & Co., Chartered
 Accountants, Pune have conducted the internal audits periodically and
 submitted their reports to Audit Committee. Their reports have been
 reviewed by the Statutory Auditors and the Audit Committee.
 
 b) Statutory Auditors
 
 The Statutory Auditors, M/s. B. K. Khare & Co., Chartered Accountants,
 Mumbai, (Registration Number 105102W) hold offi ce until the conclusion
 of the ensuing Annual General Meeting. The Company has received a
 letter from them to the effect that their reappointment, if made, would
 be within the prescribed limits under Section 224 (1B) of the Companies
 Act, 1956.
 
 Directors Responsibility Statement
 
 In accordance with the requirements of Section 217(2AA) of the
 Companies Act, 1956, the Board of Directors states that:
 
 - In the preparation of the annual accounts, the applicable accounting
 standards have been followed and there are no material departures from
 the same;
 
 - The accounting policies selected have been applied consistently and
 judgements and estimates made are 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 fi nancial year 2010-11 and of the Profit of the Company for
 that period;
 
 - Proper and suffi cient care has been taken 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;
 
 - The annual accounts have been prepared on a going concern basis.
 Employee Stock Option Plan
 
 - During the year, your Company allotted 40,231 equity shares on
 exercise of options under the Employee Stock Option Plan 2005 Grant I,
 II & III. Consequent to the above, the Issued, Subscribed and Paid-up
 Equity Share Capital of your Company increased from 184,738,492 equity
 shares (Rs. 369.477 million) to 184,778,723 equity shares (Rs. 369.557
 million) as of 31st March, 2011.
 
 - During the year, the Company has issued Grant IV - Plan A & Plan B of
 Options under the Employee Stock Option Plan 2005 aggregating 1,950,000
 options to senior executives including new CEO & MD of the Company at
 the rate of Rs. 72.70 per option.
 
 - The information to be disclosed as per SEBI (Employee Stock Option
 Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 is annexed
 to this Report (Annexure 4).
 
 Additional Statutory Information
 
 Particulars of Employees:
 
 The statement of particulars required pursuant to section 217(2A) of
 the Companies Act, 1956 read with the Companies (Particulars of
 Employees) Amendment Rules, 2011, forms a part of this Report.
 However, as permitted by the Companies Act, 1956, the Report and
 Accounts are being sent to Members and other entitled persons excluding
 the above statement. Those interested in obtaining a copy of the said
 statement may write to the Company Secretary at the Registered Offi ce.
 The statement is also available for inspection at the Registered Offi
 ce, during working hours upto the date of the Annual General meeting.
 
 Group for SEBI Takeover Regulations:
 
 For the purpose of Regulation 3 (1) (e) of the SEBI (Substantial
 Acquisition of Shares and Takeovers) Regulations, 1997, persons
 constituting Group as defi ned in the Monopolies and Restrictive
 Trade Practices Act, 1969 are - Mr. Pramod Chaudhari, Mrs. Parimal
 Chaudhari, Moriyaset Trust, Mr. Parth Chaudhari, P-Cube Enterprises
 Private Limited, Turtle Communication and Fusiontech Ventures Private
 Limited.
 
 Energy Conservation, Technology Absorption, Adaptation, Innovation
 
 Your Company offers innovative solutions to customers through continual
 research and development.  During the year, your Company,
 
 - developed a pre-processing system for sand removal from cassava chips
 for which the Company has fi led a patent.
 
 - worked on value-added products which can be derived out of brewery
 spent yeast;
 
 - developed a technology package for Hyloronic Acid, a high value
 ingredient used in skin care formulations and in osteo - arthritic and
 opthalmic treatments. Patent fi ling is in process.
 
 - introduced an effl uent treatment special process for evaporation of
 biomethanated spentwash.  The same is being tried out at a commercial
 scale operation.
 
 - developed Technology for production of Value added Fermentation
 Nutrition Products from waste streams of Brewery Plants.
 
 Other than this, your Company has introduced many new schemes and
 processes for lowering energy and water consumption and generation of
 wastewater. The initiatives taken by your Company to enhance its
 commitment to Sustainable Practices are given separately in a
 Sustainability Report, enclosed separately.
 
 Acknowledgements
 
 Your Directors wish to place on record their appreciation towards all
 associates including Customers, Collaborators, Government Agencies,
 Financial Institutions, Bankers, Suppliers, Shareholders, Employees and
 others who have reposed their confi dence in the Company.
 
                            For and on behalf of the Board of Directors
 
 Place: Pune                                           Pramod Chaudhari
 
 Date: 24th May, 2011                                Executive Chairman