To the Members of Rashtriya Chemicals and Fertilizers Ltd,
 
 The Directors of your Company have pleasure in presenting this 34th
 Annual Report on the working of your Company together with the Audited
 Accounts for the year ended 31st March, 2012.
 
 1.0.0 FINANCIAL PERFORMANCE:
 Summary of financial performance:
                                                        Rs. Crore
 
 Particulars                         2011-2012        2010-2011
 
 Sales including Subsidy               6499.22          5574.10
 
 Other Income                           129.42           103.15
 
 Total Income                          6628.64          5677.25
 
 Cost of Sales                         6099.01          5200.25
 
 Operational Profit                     529.63           477.00
 
 Depreciation                           142.44           112.66
 
 Interest (Net)                          12.74             9.65
 
 Profit/ (Loss) before tax              374.45           354.69
 
 Provision for Tax (including
 deferred Tax liability/ Asset)         125.22           109.57
 
 Net Profit / (loss)                    249.23           245.12
 
 Appropriations:
 
 Dividend                                77.24            60.69
 
 Tax and Educational cess on             12.53             9.84 
 
 Dividend  
 Balance Transferred to General         159.46           174.59
 
 Reserve
 
 1.1.0 Highlights for the year 2011-2012:
 
 Your Company achieved a turnover of Rs. 6499.22 crore compared to Rs.
 5574.10 crore in the previous year.  The turnover was higher by Rs.
 925.12 crore during the year compared to previous year. The total
 income from operations was Rs. 6628.64 crore as against Rs. 5677.25 crore
 during the previous year. Your Company achieved a gross profit of Rs.
 529.63 crore as against Rs. 477 crore in the previous year. The net
 Profit before Tax at Rs. 3 74.45 crore as against Rs.354.69 crore
 registered an increase of 5.57%.  The Net Profit after Tax during the
 year was higher at Rs.  249.23 crore as against Rs. 245.12 crore in the
 previous year registering an increase of 1.68% over previous year.
 Performance for the year 2011-12 was better as compared to previous
 year which was due to higher realizations, as well as increased volume
 of manufactured Complex fertilizers and Industrial products like
 Ammonia. This increase is despite having a net foreign exchange
 variance loss ofRs. 14.84 crore, higher operating and repairs &
 maintenance expenditure.
 
 Your Company received ''MOU Excellent'' rating for 2010-2011 and is
 likely to get the same for 2011 -12 from Ministry of Heavy Industries
 and Public Enterprises.
 
 1.2.0 Dividend:
 
 Although your Company has lined up a number of capex programmes which
 will entail substantial expenditure, considering the consistent profits
 being made by the Company, your Directors propose to pay higher
 dividend at Rs. 1.40 per each equity share of Rs.10/-, as against Rs. 1.10
 paid in the previous year. The total out go works out to X 89.77''crore
 (Rs. 70.53 crore in the previous year) including dividend distribution
 tax and education cess.
 
 1.3.0 Appropriation to General Reserves:
 
 Your Company earned a net Profit after Tax of Rs. 249.23 crore (Rs. 245.12
 crore in the previous year). The dividend pay out along with Tax/cess
 is Rs. 89.77 crore (Rs. 70.53 crore in the previous year). The balance
 amount of Rs. 159.46 crore (Rs. 174.59 crore in the previous year) is
 transferred to General Reserves.
 
 3.0.0 ENVIRONMENT MANAGEMENT AND POLLUTION CONTROL:
 
 Your Company is dedicated to improve environmental performance through
 continual improvement and is going beyond satisfying all stipulated
 requirements laid down by the statutory authorities for environment
 management and pollution control.
 
 With an aim to sustaining the operations in an environment
 friendly manner, your Company established, ISO 14001 compliant,
 Environment Management System (EMS) at its two manufacturing units. The
 Systems are constantly upgraded and the three separate systems, namely
 Quality Management System (ISO 9001:2000), Environment Management
 System (ISO 14001:2004) & Occupational Health and Safety Assessment
 Series (OHSAS 18001:2007), are all brought under Integrated Management
 System. Regular internal audits and Management Reviews are being
 carried out to ensure compliance and continually improve the system.
 
 Measures taken to conserve water have yielded not only savings but also
 have further improved the environmental management. The state of art
 Effluent Treatment plants and the Sewage Treatment plants at Trombay
 have ensured that the environment in and around the Unit is fully
 protected.  Your Company''s Sewage treatment plant is highly acclaimed
 by all.. Your Company is contemplating to install another plant.
 Various schemes are implanted to reduce wastages of the scarce natural
 resources. The waste streams from the plants are recycled/ reused for
 useful purpose.  Sludge generated in Effluent Treatment Plant, Sulphur
 Sludge Generated in Sulphuric Acid plant, waste streams of effluents
 from complex fertilizer plants are recycled back in the processes. The
 integrated Effluent Treatment Plant ensures that whatever effluent is
 discharged from the factory meets the statutory requirements laid down
 by the Pollution Control Board.
 
 In Trombay Unit of your Company, New granulation technology is adopted
 in Ammonium Nitro phosphate plant to reduce dust emission. Capacity of
 Sewage treatment plant is increased with installation of 5th RO. Your
 Company has adopted the most effective system of environmental
 management at its Trombay complex by process up- gradation, adoption of
 cleaner technologies in new plants, suitable treatment of effluent &
 continuous monitoring of emission & ambient air quality & by adoption
 of reduce, recycle & reuse methodology. A scheme is under
 implementation, to recover Ammonia from the condensate and further
 improve quality of emission.
 
 To check the effectiveness of the environmental management system and
 ensure compliance with emission regulations, monitoring network has
 been incorporated.  Apart from Stack monitors, which continuously
 monitor the emissions, four fixed ambient air quality monitoring
 stations are in place to monitor ammonia, NOx, S02, Particulate matter
 (PM10 & PM25) & metrological parameters.
 
 During the process of converting raw materials into finished products,
 certain residual chemicals are formed, which are either recycled or 
 converted into harmless chemicals as far as possible, before discharging 
 them into the atmosphere, giving due importance to cleaner environment.
 
 Your Company has taken up the exercise of Greenhouse Gas (GHG)
 Accounting, which is the process of estimating the Company''s total GHG
 emissions in terms of equivalent tonnes of Carbon dioxide. This is
 popularly known as Carbon Foot printing. Carbon Foot printing is
 typically regarded as a primary step for undertaking structured
 approach to managing company''s carbon risks. Total GHG emission in
 Trombay unit has reduced by 7.1 % during the year under report, over
 the emission during previous year.  The reduction was mainly due to
 reduction in specific consumption of energy in urea and reduction in
 N2G emission from nitric acid plant. Total GHG emission at Thai unit
 reduced by 1.3% during the year over that during previous year, mainly
 due to the steps taken to reduce energy consumption of urea. The
 specific energy reduced from 6.366 to 6.359 Gcal/MT of urea.
 
 For increasing awareness regarding environment, public awareness
 campaign programmes are arranged by Trombay unit.
 
 4.0.0 PRINCIPLES OF GLOBAL COMPACT.
 
 Your Company is a member of United Nations Global Compact and fully
 supports the Ten Principles in the areas of human rights, lab our and
 environment which are derived from the earlier declarations by United
 Nations, ILO and other international organizations. Your Company has
 posted a detailed write-up on its website www.rcfltd.com in this
 respect.
 
 5.0.0 CSR Activities:
 
 5.1.0 in line with the CSR philosophy adopted, your Company undertook
 several activities, aimed for the benefit of needy and for general good
 of the society, during the financial year 2011 -12. Your Company
 carried out many activities under CSR policy, and spent/committed about
 Rs. 12.48 crore, which are briefly stated as under:
 
 5.1.1 Education:
 
 5.1.1.1 Schools:
 
 Your Company attaches utmost importance to Education of children and to
 this end, supports schools, both at its Thai and Trombay units, to
 cater to students from Nursery to 10th Standard. The schools admit
 children from communities nearer to its two operating units.
 Instructions are imparted in Marathi, Hindi and English medium. Your
 Company has provided school buildings in the Company''s residential
 colonies at Thai and Trombay and undertakes its upkeep, maintenance and
 bears the deficit expenditure incurred by the schools. The schools are
 entrusted to reputed Educational Institutions. Your Company also
 supports the cause of education in the marketing areas.  During the
 year your Company spent an amount of Rs.3.14 crore under this activity.
 
 5.1.1.2 Scholarship to meritorious students:
 
 Your Company encourages students from SC/ ST/ OBC communities by
 offering them scholarship for pursuing higher studies. During the year,
 your Company spent Rs. 30 lakh.
 
 5.1.1.3 Supply of Mid-Day Meal:
 
 Your Company, through ''ISCKON Food Relief Foundation'' provided
 nutritious mid-day meals to about 5000 children, studying in seven
 unaided schools imparting education to the poor children, in Trombay
 area at a cost of Rs. 80 lakh and proposes to cater to more students in
 financial year 2012-13.
 
 5.1.1.4 Farmers'' Education:
 
 Your Company imparts farming education to increase productivity through
 intensive and integrated extension activities in the field of
 Agriculture, recommending balanced use of fertilizers and
 simultaneously to extend the services as promoter, activator and
 organizer of various socio- economic and educational activities to
 improve the quality of life of various rural masses particularly small,
 marginal and SC/ST families.
 
 5.1.2 Supply of drinking water to the villages:
 
 Your Company has been providing drinking water since more than 20 years
 to seven villages around Thai unit through pipelines laid down from the
 water reservoir in the unit and spent Rs. 64 lakh on this account during
 the year.
 
 5.1.3 Village Adoption:
 
 Your Company provides support to needy people by providing tools,
 tackles and training to enable them learn self-sustaining vocations and
 improve their economic capabilities. An Expenditure of Rs. 10 lakh is
 spent on the training imparted for improving their skills during the
 financial year. Your Company sponsored games and sports such as Kabaddi, 
 KhoKho etc.
 
 5.1.4 Chembur Green Project:
 
 Your Company continued to support the Chembur Green project, launched
 to establish greenery in the eastern suburb of Mumbai. Your Company''s
 efforts since more than 30 years has brought back the green forestry
 amidst concrete jungle in the area. The development of traffic islands,
 kitchen gardens, exhibitions, Rose shows and
 
 other activities in schools and colleges have increased the environment
 consciousness among the citizens. Your Company continues distribution
 of free saplings and rendering advice to various co-op. societies and
 also to individuals.
 
 5.1.5. Service to Farmers:
 
 5.1.5.1 Advice on Soil nutrients:
 
 The services of your Company in respect of rendering Soil diagnostics,
 as a means of advising farmers about use of proper dosage of
 fertilizers in order to optimize soil productivity, are well
 recognized. During the year, more than 70,000 soil samples were
 analyzed and recommendations given through the five static and six
 mobile soil testing laboratories. Your Company is taking steps to
 supplement the sendee by adding six additional static and six mobile
 testing laboratories to its existing infrastructure as a service to the
 nation.
 
 5.1.6 Farm practices:
 
 Your Company continues to have grass root contact with farmers to
 disseminate knowledge of proper farm practices to enhance their farm
 income. In this regard, your Company undertook crop specific
 development programs depending on the State/area. Your Company has
 established several Farmers Service Centres for providing services such
 as soil sample collection, arranging farmers meeting, film shows, and
 exhibitions and for providing general guidance in the fields of
 farming. Several farmers'' / dealers'' training programmes were conducted
 during the year at the Company''s two Farmers Training Institutes.
 
 5.1.7 Other activities:
 
 Your Company has constructed a mini sports stadium along with
 accessories and facilities in Jaleshwar, Balasore district to encourage
 sports and culture of the area.
 
 6.0.0 Sustainable Development
 
 Your Company has taken up several Sustainable development activities
 including the following:
 
 [i] Improvement of Road infrastructure- construction and repairs.
 
 [ii] Building of Check Dams.
 
 [iii] Prevention of soil erosion and watershed management.
 
 The Rapid wall project, which has been implemented, is an example of
 Company''s faith in sustainable development wherein a waste product
 generated from Phosphoric Acid Plant is converted into useful building
 material by adopting a novel technology.
 
 Your Company is also considering several major activities connected
 with Green House Gas, sustainable electricity distribution based on
 solar energy etc. Your Company has signed an agreement of Financial Aid
 for rehabilitation of the existing Bio-gas plant in Shatabdi hospital
 which is being coordinated through Rotary Club Chembur. Your Company is
 targeting to take up many more sustainable development activities in
 the near future.
 
 In order to give more thrust to sustainable development, a Committee of
 the Board has been formed to approve Sustainable Development plans and
 to oversee Sustainable Development performance.
 
 Your Company is planning to put up a new Sewage Treatment Plant of
 similar capacity as that existing at Trombay unit as a part of
 sustainable development plan to enable Mumbai city to have additional
 potable water for its citizens as your Company would the recycling the
 sewage water supplied by BMC and would be using that water for its use.
 
 7.0.0 Vigilance
 
 Vigilance Department is headed by a full time Chief Vigilance Officer
 (CVO) deputed, from the All India Service, by Government of India. The
 position of CVO is at par with the functional directors. CVO is
 assisted by a team of senior officers drawn from various functional
 departments. Vigilance Department is engaged in Vigilance activities at
 Corporate Office, Trombay Unit, Thai Unit and also at the Marketing
 Offices situated through out the country. The thrust of vigilance in
 your Company is to bring out greater transparency, integrity and
 efficiency in the functioning of various departments. Vigilance
 Department emphasises on Preventive and Participative Vigilance.
 Careful watch is kept on various activities through regular and
 surprise inspections. System improvements and corrective action are
 taken wherever necessary. All officials of the organization are
 considered to be part of vigilance set up and their alertness and
 support are taken in the management of vigilance. One of the prime
 functions of vigilance is to spread awareness with reference to
 vigilance issues and solicit information/complaints regarding any
 malpractice/corruption.
 
 During the year, the department had actively contributed in adoption of
 Fraud Prevention Policy, Integrity Pact, and revision of manuals
 relating to marketing, procurement and works contracts. As a result of
 vigorous follow up, good progress has been achieved by your company in
 E- conveyance by implementing E-tendering, E-reverse auction, E-Payments
 and E-Receipts.
 
 8.0.0.HUMAN RESOURCES:
 
 8.1.0 Training and Development:
 
 One of the strengths of your Company is its skilled and professional
 man-power. This could be achieved by adopting good HR policies and
 undertaking training and development of all employees. Training
 imparted includes enhancing General Management skills of the employees
 in various functions viz. Marketing, Finance, Commercial and Health
 Services disciplines.
 
 Quality Management Systems, Environment Management Systems,
 Occupational Health and Safety Systems and 5 S Systems are given
 focused attention. The work culture of your Company has been enhanced
 by introducing the Six Sigma and Lean Quality Circles. System of
 Mentorship for newly recruited Management Trainees has been instituted.
 
 Training and Development programmes were conducted, in-house for the
 employees of your Company at various levels. Besides this,
 comprehensive Safety Management Programmes were carried out for
 officers in Technical disciplines.
 
 Your Company has been awarded, by World HRD Congress, with Global HR
 Excellence Award, for Excellence in Training”. Your Company has
 also been accorded the award for Best HR Strategic Plan” and
 Outstanding Contribution of HR to Organization Development” in the
 Indian Human Capital Summit 2011.
 
 8.2.0 Industrial Relations:
 
 Your Company maintained cordial Industrial Relations with all its
 employees. All the issues are settled through regular discussions,
 meetings and dialogues with the employees. Your Company has 4104
 employees comprising of 1517 officers and 2587 workmen as on 31st
 March, 2012 compared to 4238 employees (1541 officers and 2697 workmen)
 as on the corresponding date of the previous year.
 
 8.3.0.  Welfare and Sports
 
 Your Company undertakes several welfare schemes like education,
 medical, transport, housing etc., according to the needs of the
 employees. In regard to sports, your company is a prominent patron and
 sponsored various sports events. Your company''s Football, Cricket,
 Hockey, Kabbaddi and other teams continue to show excellent performance
 at District, State and National levels and have brought laurels to your
 company by winning several prizes.
 
 8.4.0.  Welfare / Employment opportunity to weaker section: The
 guidelines in respect of reservation in recruitment and
 
 promotion of SC/ST, OBC, Ex-servicemen and Persons with Disabilities
 are followed by your Company. Your Company has 572 Scheduled Caste
 (SC), 259 Scheduled Tribe (ST) and 341 OBC employees on its rolls.
 
 During the year, your Company recruited 40 persons, including 2 persons
 with physical disability, on regular employment. Due representation to
 SC/ST/OBC was given in recruitments.
 
 Your Company is committed to the welfare of the backward classes in
 general and SC/ST employees in particular. Regular meetings are held
 with SC/ST Employees Welfare Association to address grievances, if any,
 and providing guidance for development.
 
 Medical Camp is organized every year at Chaitya Bhoomi, Dadar on 6th
 December, on the occasion of ''Mahaparinirvan Day''. Financial assistance
 for making arrangement for medical camp and for medicines along with
 the vehicles and Doctors are made available by your Company.
 
 Your Company''s Thai Unit provides various amenities like water, road
 for the nearby villages e.g. Thai, Navgaon, Boris, Gunjis etc. where
 the majority of the population belongs to the SC/ST categories. The
 facility continued during the year. Scholarships were given to
 meritorious students of SC/ST community in the nearby villages of Thai.
 
 Large number of SC/ST farmers have been trained in the programmes
 conducted at the Company''s Farmers'' Training Centres at Nagpur and
 Thai.
 
 9.0.0 PARTICULARS OF EMPLOYEES:
 
 A statement providing the information as required under section 217 (2
 A) of the Companies Act, 1956 is attached to this report as Annexure
 II.
 
 10.0.0 OFFICIAL LANGUAGE POLICY:
 
 Your Company has fully endeavored to implement the provisions of
 Official Language Act 1963 and the policy of the Government. Publicity
 material and literature for employees and farmers is made available in
 Hindi and other regional languages.
 
 Your Company was awarded the First prize by Mumbai Town Official
 Language implementation Committee for excellence in implementation of
 Official Language Policy.  Your Company''s House Magazine, Darpan”
 was also awarded first Prize in House Magazine competition organized by
 Mumbai Town Official Language implementation Committee for the year
 2011-12
 
 11.0.0 INTERNAL CONTROL SYSTEM:
 
 Your Company has a well defined Internal Control System
 
 i.e. adequate and commensurate with the size and nature of its business
 comprising of an in-house Audit Department, which conducts internal
 audit of various operational and financial matters on on-going basis.
 Internal Audit group consists of adequate number of financial and
 technical personnel. The recommendations and observations of the
 Internal Audit Department are reviewed regularly by the Audit Committee
 constituted by the Board of Directors.  The performance of the
 committee is regularly monitored by the Board of Directors.
 
 Your Company has an effective budgetary control mechanism in place to
 take care the detailed capex and operational budget. Appropriate
 monitoring mechanism to compare the actual performance with the budget
 ensures that necessary review is periodically undertaken.
 
 12.0.0 COSTAUDIT
 
 As per the Government''s directive, your Company''s Cost Records in
 respect of manufacture of Fertilizers and Sulphuric Acid for the year
 ended 31st March, 2012 are being audited by M/s Rohit Vora & Co. and
 M/s C.R.Musib & Associates, firms of Cost Auditors. The Cost Auditors
 are likely to complete the audit by 31” July, 2012.  The Cost Audit
 Reports for 2010-11 were filed with the Ministry of Company Affairs on
 29111 September,2011 for Trombay Urea and on 27th September,2011 in
 respect of Sulphuric acid and Thai Urea as against the due date of 30th
 September,2011.
 
 13.0.0 DIRECTORS'' RESPONSIBILITY STATEMENT:
 
 In terms of section 217 (2AA) of the Companies Act, 1956, your
 Directors state that:
 
 i] in preparing the annual accounts, the applicable accounting
 standards have been followed,
 
 ii] the accounting policies adopted have been consistently applied and
 wherever necessary, made judgments and estimates that are reasonable
 and prudent so as to give a true and fair view of the state of affairs
 of your Company at the end of the financial year and of the profit or
 loss of the Company for the year,
 
 iii] proper and sufficient care has been taken for maintaining adequate
 accounting records in accordance with the provisions of the Companies
 Act, 1956 for safe guarding the assets of your Company and for
 preventing and detecting fraud and other irregularities; and
 
 iv] the annual accounts have been prepared on a going concern basis.
 
 14.0.0 CORPORATE GOVERNANCE:
 
 As per Clause 49 of the listing Agreement with the Stock Exchanges, a
 separate section on Corporate Governance along with a certificate of
 Compliance is annexed and forms part of this report.
 
 15.0.0 CAUTIONARY STATEMENT:
 
 Statements in the Management Discussion and Analysis describing the
 Company''s objectives, projections, estimates and expectations may be
 ''forward looking statements'' and actual results may or may not be in
 accordance therewith. Your Company''s performance is dependent on
 several external factors such as effective monsoon, significant changes
 in economic environment, Government Policies, fluctuations in prices of
 raw material and finished products and also their availability etc.
 which could adversely affect the operations of your Company.
 
 16.0.0 DIRECTORS:
 
 Shri Manoj Priya demitted his Office as Director (Technical) on
 30.09.2011 on attaining the age of superannuation. The contribution of
 Shri Manoj Priya to your Company has been immense. His guidance,
 suggestions and advice has greatly benefited the Company. Your
 Directors place on record their appreciation of the contribution of
 Shri Manoj Priya to your Company. President of India appointed Shri
 C.M.T.Britto as Director (Technical), who assumed the office on
 11.04.2012. Notice under section 257 of the Companies Act has been
 received proposing the candidature of Shri C.M.T.Britto as Director of
 your Company.
 
 As per Section 256 of the Companies Act, Dr V.  Rajagopalan and Shri
 Gautam Sen, Directors retire by rotation at the ensuing Annual General
 Meeting and being eligible, offer themselves for reappointment.
 
 17.0.0 AUDITORS:
 
 The Comptroller and Auditor General of India (CAG) has appointed, M/s.
 JCR & Company and M/s Nissim & Co, as Joint Statutory Auditors of your
 Company for the Financial Year 2011-12. The Auditors would be retiring
 at the conclusion of the Thirty fourth Annual General Meeting.
 
 The Statutory Auditors for the Financial Year 2012-13 will be appointed
 by the CAG. However, their remuneration is to be fixed at the AGM by
 the members.
 
 18.0.0 ACKNOWLEDGMENT:
 
 Your Directors wish to gratefully acknowledge the valuable guidance and
 continued support extended by Government of India and in particular,
 the Department of Fertilizers and the Office of Fertilizer Industry Co-
 ordination Committee (FICC), Railways, DPE, members of MOU Task force,
 and other Central Government departments and Agencies. ''
 
 The Board also wishes to acknowledge with sincere gratitude, the help
 and unstinted support from the State Governments, MSEB, MIDC, various
 media, Municipal authorities, Maharashtra Pollution Control Board,
 Bankers to your Company, Financial Institutions, Dealers and Customers.
 
 The Board also wishes to place on record the positive suggestions and
 guidance provided by the Statutory
 
 Auditors, Cost Auditors and the Office of the Principal Director of
 Commercial Audit.
 
 Last but not the least, your Directors take pleasure in placing on
 record their deep appreciation of the excellent contribution made by
 the employees of your Company at all levels, without which your Company
 would not have achieved such good performance.  ''
 
                                      By order of the Board of Directors
 
                                                               R.G.Rajan
 
                                          Chairman and Managing Director.
 
 Place: Mumbai
 
 Date : 30th May 2012