The Directors are pleased to present the Thirty Seventh Annual Report
 alongwith the audited accounts of the Company for the year ended 31 st
 March 2006.
 
                                                        (Rs. in lacs) 
 FINANCIAL RESULTS:                           2005-2006      2004-2005
 
 Sales and other Income                       3346.70         3652.53
 Operating Profit before Interest & 
 Depreciation                                  488.78          456.66
 Cost of Finance                                31.76           46.75
 Depreciation                                   67.76           70.17
 Profit before tax                             389.26          339.74
 Add: Previous year adjustments                  1.12            5.09
 
 Less/(Add) Provision for:
 
 Income Tax                                    139.15           132.86
 Fringe Benefit Tax                              7.71              - 
 Wealth Tax                                      2.22             2.18
 Deferred tax (income)/expenditure             (11.52)           (3.16)
 Profit after tax                              252.82           212.95
 Add: Balance of Profit brought forward        648.89           634.89
 
 Less: Appropriations:
 
 Transfer to Capital Redemption Reserve         11.20            60.41
 Transfer to General Reserve                    24.00             -  
 Premium paid on Buy back of Equity Shares      29.11           102.69
 Proposed Dividend                              29.76            31.44
 Tax on Proposed Dividend                        4.17             4.41
 Balance carried to Balance Sheet              803.47           648.89
 
 DIVIDEND:
 
 The Directors are pleased to recommend a dividend of 15 % (Rs. 15/- per
 equity share of Rs. 100/- each) on the paid up equity share capital of
 the Company.
 
 REVIEW OF OPERATIONS AND FUTURE PROSPECTS:
 
 During the year under review, your Company has achieved a turnover of
 Rs. 3265.34 Lacs as compared to Rs. 3582.58 Lacs in the previous year.
 The profit after tax has increased to Rs. 252.82 Lacs from Rs. 212.95
 Lacs in the previous year. The profit is increased mainly on account of
 better per unit realization from sales, reduction in overhead
 expenditure, interest costs and reduction in rate of VAT.
 
 The market order conditions are encouraging and your Directors expect
 to achieve improved turnover in the current year. Your Directors are
 hopeful that in spite of highly competitive market conditions, your
 Company will be able to secure a sizeable share of business in the
 market for both reinforced and unreinforced products.
 
 The members are aware of the alteration made to the Objects Clause of
 Memorandum of Association of the Company in order to enable it to carry
 on the business of shipping. Your Directors are pleased to inform you
 that the construction of commercial complex at Pune is in advanced
 stage and your Directors are hopeful to complete the same before the
 end of current Financial Year.
 
 BUYBACK OF SHARES:
 
 During the year under review, the Company has effected buyback of
 11,196 Equity Shares of Rs. 100/- each at a price of Rs.360/- per share
 after complying with the applicable provisions of the Companies Act,
 1956, and the rules framed there under. The total outflow on account of
 this buyback was Rs.40.31 Lacs. Consequent to buyback, the paid up
 share capital of the Company is reduced from Rs.209.59 Lacs to Rs.
 198.40 Lacs.
 
 SCHEME OF ARRANGEMENT WITHTHE SHAREHOLDERS:
 
 The Company has proposed a Scheme of Arrangement under Sections 391 to
 394 read with Sections 100 to 103 of the Companies Act, 1956, for
 purchase and cancellation of upto 1368 Equity Shares (representing
 0.69% of the paid up Equity Share Capital of the Company) which are
 held by shareholders other than Promoter shareholders, holding upto 50
 equity shares each in the capital of the Company (eligible
 shareholders). The said scheme is subject to the approval of the
 eligible and other shareholders of the Company and further subject to
 the approval of the High Court of Judicature at Bombay.
 
 DIRECTORS:
 
 Mr. B. G. Deshmukh, IAS (Retd.) and Mr. V. R. Manohar retire by
 rotation at the ensuing Annual General Meeting and being eligible have
 offered themselves for re-appointment.
 
 AUDITORS:
 
 M/s Bhide & Shah, Chartered Accountants, retire at the ensuing Annual
 General Meeting and are eligible for re-appointment. The Members are
 requested to appoint auditors for the current year and to fix their
 remuneration.
 
 PATICULARS OF EMPLOYEES:
 
 The information required under Section 217(2A) of the Companies Act,
 1956, read with the Companies (Particulars of Employees) Rules, 1975,
 is given in Annexure B which forms part of this Report.
 
 DIRECTORS RESPONSIBILITY STATEMENT:
 
 Pursuant to Section 217 (2AA) of the Companies Act, 1956, the Board of
 Directors confirm that:
 
 a) In the preparation of the annual accounts, the applicable accounting
 standards have been followed and there was no material departure from
 the accounting standards.
 
 b) Accounting policies have been selected and applied consistently and
 judgments and estimates made are reasonable and prudent so as to give a
 true and fair view of the state of affairs of the company as on 31st
 March 2006 and of the profit of the Company for the year ended on that
 date.
 
 c) Proper and sufficient 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, and
 
 d) The annual accounts have been prepared on a going concern basis.
 
 EMPLOYEE RELATIONS:
 
 The relations with the employees continue to be cordial and harmonious
 and your Directors place on record their sincere appreciation of
 efforts made by all the employees towards the growth of the
 organisation.
 
 ACKNOWLEDGMENT:
 
 Your Directors place on record their grateful thanks to various
 Government Departments, Semi-Government Agencies, various customers
 from Private and Public Sector and our Agents and Dealers for extending
 their support to your Company.
 
 Your Directors also thank Central Bank of India, UTI Bank Ltd., and
 other Financial Institutions and also various clients for their
 continued support and interest in the Company.
 
                       FOR AND ON BEHALF OF THE BAORD OF DIRECTORS
 Place : Pune                            B.G. DESHMUKH
 Date : 5th September, 2006                 CHAIRMAN