To, The Members of Refnol Resins and Chemicals Limited Mumbai.
 
 The Directors present their 31st Annual Report together with the
 Audited Statement of Accounts of Company for the year ended 31st March
 2012.
 
 1) FINANCIAL RESULTS:
 
 The financial results of the Company for the year under review are as
 under: -
 
                                                          (Rs. in lacs)
 
 Particulars                                  2011-12           2010-11
 
 Profit/(Loss) before Financial 
 Costs and Depreciation                        (62.24)           126.20
 
 Less:- Interest & Financial Charges           145.60            106.61
 
 Less:- Depreciation                            15.41             15.26
 
 Profit/(Loss) Before Tax                     (223.25)             4.33
 
 Tax Expenses                                    0.00              2.75
 
 Short Provision of Tax in 
 respect of earlier years                       (0.43)                -
 
 Net Profit/(Loss) After Tax                  (223.68)             1.58
 
 Profit available for Appropriation           (223.68)             1.58
 
 2) OPERATIONS:
 
 Despite continuous efforts to maintain and increase turnover and
 profitability, there was a sharp decline in sale by 21.70% from Rs.
 2410.31 lacs to Rs. 1887.34 lacs. Exports decreased by 13.31% from Rs
 752.17 lacs to Rs 652.07. The decline in turnover was largely due to
 reduction in the composite and coating resin businesses of the company
 both in domestic and export markets and sharply reduced profitability
 in these business due to rapid increase in raw material prices during
 the year, fuelled by increase in petroleum product prices. It was not
 possible in the short-run to increase business in the textile and
 garment chemicals area to compensate.
 
 There was also a steep increase in interest and financial charges which
 went up by 36.57% as compared to the previous year.
 
 Due to the combination of above factors the operations have resulted in
 a loss of Rs. 223.68 lacs for the last financial year.
 
 3) MARKETING AND EXPORTS:
 
 The textile and garment industry both in India and worldwide are in the
 grip of a sharp down turn in demand. To counter this, strenuous efforts
 have been made by the company to widen its customer base and strengthen
 its presence in new markets at home and abroad.
 
 The company will continue its efforts to increase the sales in both
 export and domestic market in this year and is making every effort to
 increase business in the high value added products in the various
 business areas.
 
 The company strives its best to market its products in India and abroad
 and enjoys the loyalty of a large group of customers for its various
 products. While maintaining the polyester resin business, extra efforts
 are being put in to increase the sales of textile chemicals, laundry
 and garment processing chemicals with a view to restore and increase
 profitability.
 
 The operations of the company have in fact improved significantly over
 the few months since the end of the last financial year and we expect
 the positive trend to continue.
 
 4) DIVIDEND:
 
 In view of the accumulated losses, your Directors have not recommended
 any dividend for the year under review.
 
 5) DEPOSITS:
 
 Your Company has not accepted any public deposit within the meaning of
 the provisions of Section 58A of the Companies Act, 1956.
 
 6) DIRECTORS:
 
 The Board of Directors of your company has various executive and
 non-executive directors including independent directors who have wide
 and varied experience in different disciplines of corporate
 functioning. Mr. Mahendra Khatau, Director of the company, retires by
 rotation at the forthcoming Annual General Meeting and being eligible,
 offers himself for re- appointment.
 
 7) INSURANCE:
 
 All the insurable assets of the company including Plant & machinery,
 Buildings and Inventories are adequately insured.
 
 8) SUBSIDIARY COMPANY:
 
 Pursuant to the requirements of Section 212 of the Companies Act, 1956
 the Annual Accounts of the Company''s subsidiary viz., Refnol Overseas
 Limited for the period ended 31st March 2012 is annexed together with
 the statement showing the extent of the Company''s interest therein.
 
 9) MANAGEMENT DISCUSSIONS AND ANALYSIS REPORT:
 
 Your company manufactures textile sizing chemicals and auxiliaries,
 garment wash and laundry chemicals and polyester resins at Plot No. 23,
 G.I.D.C., Naroda, Ahmedabad, Gujarat. The company caters to both the
 domestic and international markets. The product range finds application
 in textile industry, garment processing industry and composites
 industry. The company has a marketing and distribution network for
 these chemicals with full technical service break-up. Rapid growth is
 expected in both the textile chemical and garment chemicals business
 and steps are being taken to strengthen and deeper the distribution and
 sales network of the Company.
 
 10) CORPORATE GOVERNANCE:
 
 Your company has taken adequate measures to ensure that the provision
 of corporate Governance as prescribed under clause 49 of the listing
 agreement with stock exchanges are complied with. A detailed report as
 per Appendix ''I'' on corporate governance, along with auditors''
 certificate on its Compliance by the Company, forms part of this
 report.
 
 11) DIRECTORS'' RESPONSIBILITY STATEMENT:
 
 It is hereby confirmed:
 
 1.  That in the preparation of the Accounts for the financial year
 ended 31st March 2012; the applicable accounting standards have been
 followed along with proper explanation relating to material departures.
 
 2.  That the Directors have selected such accounting policies and
 applied them consistently and made judgments and estimates that were
 reasonable and prudent so as to give true and fair view of the state of
 affairs of the Company at the end of the financial year and of the
 Profit or loss of the Company for the year under review.
 
 3.  That the Directors have taken proper and sufficient care 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.
 
 4.  That the Directors have prepared the annual accounts on a going
 concern basis.
 
 12) EMPLOYEES:
 
 Relations between the employees and the management continued to be
 cordial during the period under review. The Directors hereby place on
 record their appreciation for the efficient services rendered by the
 company''s employees at all levels.
 
 The Company has not paid any remuneration attracting the provisions of
 Companies (Particulars of Employees) Rules, 1975 read with Section
 217(2A) of the Companies Act, 1956. Hence, no information is required
 to be appended to this report in this regard.
 
 13) CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE
 EARNINGS AND OUTGO:
 
 Statement giving Particulars with respect to conservation of energy,
 technology absorption, foreign exchange earnings and out-go, in terms
 of Section 217 (1) (e) of the Companies Act, 1956 read with Companies
 (Disclosure of Particulars) Rules, 1988 is given in Appendix ''II''
 forming part of this Report.
 
 14) LISTING:
 
 Your company''s shares are listed with The Stock Exchange, Mumbai,
 Phiroze Jeejeebhoy Towers, Dalal Street, Fort, Mumbai. (Stock Code: -
 530815). The Company has already paid Annual Listing fees of The Stock
 Exchange, Mumbai for the ensuing financial year.
 
 15) AUDITORS AND AUDITORS'' REPORT:
 
 The present Auditors of the Company M/s. G. P Kapadia & Co., Chartered
 Accountants, retires at the ensuing Annual General Meeting and being
 eligible, offers themselves for reappointment.
 
 The Auditors Report and the notes to the Accounts being
 self-explanatory, no further explanation is required.
 
 16) COMPLIANCE REPORT:
 
 In accordance with Section 383A of the Companies Act, 1956, the Company
 has obtained a Certificate from Company Secretary in the whole time
 practice confirming that the Company has complied with the provisions
 of the Companies Act, 1956 as mentioned in the Certificate, and a copy
 of such certificate is annexed to this report.
 
 17) ACKNOWLEDGEMENT:
 
 Your Directors record their appreciation of the Co-operation and
 assistance extended by Financial Institutions, Banks and Government
 Authorities as well as valued customers from time to time. They also
 record their appreciation of the devoted services rendered by the
 Executives, Staff Members and Workers of the Company.
 
                                         For and on behalf of the Board,
 
 Date : 29th May, 2012                          Mahendra K. Khatau
 
 Place : Mumbai                                      Chairman