Praj Industries

1. Segment reporting
 
 The Companys activities involve predominantly one business segment
 i.e. Process and Project Engineering, which are considered to be within
 a single business segment since these are subject to similar risks and
 returns. Accordingly, Process and Project Engineering comprise the
 primary basis of segmental information as set out in these financial
 statements, which therefore reflect the information required by AS 17 -
 Segment Reporting, with respect to primary segments.
 
 The Company has identified India and Rest of the World as geographical
 segments for secondary segmental reporting.  Geographical sales are
 segregated based on the location of the customer who is invoiced or in
 relation to which the sale is otherwise recognised. Assets other than
 receivables used in the Companys business or liabilities contracted
 have not been identified to any of the reportable segments, as these
 are used interchangeably between segments. All assets other than
 receivables are located in India. Similarly, capital expenditure is
 incurred towards fixed assets located in India.
 
 2. Quantitative information of foreign exchange instruments
 outstanding as at the Balance Sheet date
 
 The foreign currency forward contracts outstanding as at the Balance
 Sheet date aggregate USD 22.250 & GBP 2.250 (2008 : USD 13.000, GBP
 Nil).
 
 3. Employee benefits
 
 The disclosures in accordance with the requirements of Accounting
 Standard 15 (Revised 2005) Employee Benefits are provided below:
 
 (a) Defined contribution plans
 
 The Company has recognised Rs. 21.566 towards post employment defined
 contribution plans comprising of provident and superannuation fund in
 the Profit and Loss Account.
 
 4. Employee stock options :
 
 The Compensation Committee of the Company established the Employee
 Stock Option Plan on 23 July 2005. Employees covered by the Plan are
 granted an option to purchase shares of the Company subject to the
 requirements of vesting. Total of 4,055,626 stock options were approved
 in the Annual General Meeting of the Company held on 23 July 2005, of
 which the employees have been granted 1,743,000 stock options on 12
 October 2005 (Grant I) and 1,176,900 stock options on 28 D ecember
 2006 (Grant II).
 
 The stock options vest in a graded manner equally over three years with
 each vesting taking effect on the expiry of 12 months from the date of
 grant. These can be exercised within a period of three years from the
 date of vesting. The stock options granted are exercisable at 100% of
 the fair market value of the underlying equity shares of the Company as
 on the date of grant.
 
 5. Prior year comparatives :
 
 Previous years figures have been regrouped/reclassified to conform to
 the current years presentation. The previous years financial
 statements were audited by a firm other than B. K. Khare & Co.,
 Chartered Accountants.