The directors have pleasure in submitting their 38th Annual Report
 together with the Audited Accounts for the year ended March 31, 2012
 (the year).
 
 Performance highlights                     2011-12        2010-11
                                               (Rupees lakhs)
 
 Turnover:
 
 Direct exports                                579           134
 
 Merchandise exports                          3048          3690
 
 Domestic Sales                              14893         16731
 
 Total Yarn Sales                            18520         20555
 
 Conversion charges earned                      32            22
 
 Wind Energy Converter Power                   127           136
 sold to third party
 
 Total turnover                              18679         20713
 
 Profit/(loss) : 
 
 Profit/(loss) before, interest 
 and depreciation)                             759          4474
 
 Cash profit/(loss) (ie. profit/(loss)
 before depreciation)                       (1044)          3035
 
 Profit/(loss) before tax                   (2164)          1921
 
 Profit/(loss) after tax                    (1444)          1256
 
 Dividend
 
 Due to the loss incurred by the Company, your directors have not
 recommended any dividend for the year ended 31.3.2012.
 
 INDUSTRY ASSOCIATIONS
 
 During the year, Sri S. Dinakaran, Joint Managing Director of your
 Company was elected to be the Chairman of the Southern India Mills''
 Association (SIMA). He is also a member of the Committee of
 Administration of The Cotton Textiles Export Promotion Council(
 TEXPROCIL), Mumbai and the Confederation of Indian Textile Industry
 (CITI), Delhi. By virtue of the offices he holds, Mr. Dinakaran has
 been representing to the Industries and Finance Ministries to get
 relief to the ailing Textile Industry.
 
 
 COST AUDIT REPORT
 
 As per the directions of the Cost Audit Branch of the Ministry of
 Corporate Affairs, M/s.S.MAHADEVAN & CO., Cost Accountants, Coimbatore,
 were appointed Cost Auditors for audit of Cost Accounts of the Company
 and their report for the year ended 31st March 2011 was submitted on
 14.9.2011 to the Ministry of Corporate Affairs (VIDE SRN B 20301420
 dated 14.9.2011). Due date for submission of that Cost Audit Report was
 27.9.2011.
 
 M/s. S. Mahadevan & Co. were again reappointed for Audit of Cost
 Accounts of the Company for the year ended 31.3.2012. Their report for
 the year ended 31.3.2012 will be filed before the due date, i.e.
 27.9.2012.
 
 Directors
 
 Sri RS. Ananthanarayanan and Sri D. Sudharsan, Directors, retire by
 rotation and are eligible for reappointment.
 
 Your Company''s Code of Conduct applicable to the board has been adopted
 by the board and all the directors of the company have confirmed
 compliance with the Code of Conduct.
 
 Auditors
 
 The auditors, M/s. M.S. Krishnaswami & Rajan, Chartered Accountants,
 retire at the ensuing annual general meeting and have confirmed their
 eligibility and willingness to accept office, if appointed.
 
 Annexure .
 
 Annexure to this report details Statement on directors'' responsibility,
 conservation of energy, technology absorption, Research and Development
 and foreign exchange earnings and outgo.  None of the employees of the
 Company has drawn remuneration exceeding Rs.5 lakhs per month or Rs.60
 lakhs per annum during the year. As such the information required
 pursuant to Sec. 217(2A) of the Companies Act, 1956 is not applicable
 to the Company.
 
 (i) Directors'' Responsibility Statement as per section 217(2AA) of
 the Companies Act, 1956 Responsibility in relation to financial
 statements
 
 The financial statements have been prepared in conformity, in all
 material respects, with the applicable Accounting Standards in a
 consistent manner and supported by reasonable and prudent judgments and
 estimates. The Directors believe that the financial statements reflect
 true and fair view of the financial position as on 31.3.2012 and of the
 results of operations for the year ended 31.3.2012.
 
 The financial statements have been audited by M/s M.S. Krishnaswami &
 Rajan, Chartered Accountants in accordance with generally accepted
 auditing standards, which include an assessment of the system of
 internal controls and tests of transactions to the extent considered
 necessary by them to support their opinion.  .
 
 Going Concern
 
 in the opinion of the Directors, Company will be in a position to carry
 on its existing spinning of yarn business and accordingly it is
 considered appropriate to prepare the financial statements on the basis
 of going concern.
 
 Maintenance of accounting records and Internal controls Company has
 taken proper and sufficient care for maintenance of adequate accounting
 records as required by various Statutes.
 
 Directors have overall responsibility for the Company''s internal
 control system, which is designed to provide a reasonable assurance for
 safeguarding of assets, reliability of financial records and for
 preventing and detecting fraud and other irregularities.
 
 The internal audit function, encompasses the examination and evaluation
 of the adequacy and effectiveness of the system of internal control and
 quality of performance in carrying out assigned responsibilities.
 Internal Audit Department interacts with all levels of management and
 the Statutory Auditors, and reports significant issues to the Audit
 Committee of the Board.
 
 Audit Committee supervises the financial reporting process through
 review of accounting and reporting practices, financial and accounting
 controls and financial statements. Audit Committee also periodically
 interacts with internal and statutory auditors to ensure quality and
 veracity of Company''s accounts.
 
 Internal Auditors, Audit Committee and Statutory Auditors have full and
 free access to all the information and records as considered necessary
 to carry out their responsibilities. All the issues raised by them have
 been suitably acted upon and followed up.
 
 Acknowledgements
 
 Your directors thank the Company''s Customers, Vendors and Investors for
 their continued support during the year. Your directors place on record
 their appreciation for the contribution made by the employees at all
 levels. Your Company''s consistent growth has been made possible by the
 hard work, solidarity, cooperation and support of the management team.
 
 Your directors thank State Bank of India, Karnataka Bank Limited, IDBI
 Bank Limited, Axis Bank Limited, Canara Bank, Indian Overseas Bank and
 Central Bank of India, Government of Tamil Nadu and other government
 agencies for their support, and look forward to their continued support
 in future.
 
 
                                       For and on behalf of the Board 
 
 Salem                                           S. Devarajan
 
 May 30,2012                           Chairman and Managing Director