The Members,
 
 WELSPUN INDIA LIMITED
 
 The directors have pleasure in presenting their 26th Annual Report on
 the Audited Financial Statements of the Company for the financial year
 ended March 31, 2011.
 
 I.  FINANCIAL HIGHLIGHTS
                                         (Rs. in Millions 
                                              except EPS)
                                                 % age to 
                                  Current year
 Particulars                                        Total
                                  31.03.2011
                                                   Income
 
 Turnover                          19,907.62        96.48
 
 Other Income                         726.20         3.52
 
 Total Income                      20,633.82       100.00
 
 Profit before Interest, 
 Depreciation and Tax (PBIDT)       2,949.40        14.29
 
 PROFIT BEFORE TAX (PBT)            1,028.67         4.99
 
 Less: Provision for taxation         349.48         1.69
 
 PROFIT / (LOSS) AFTER TAX 
 (PAT) from ordinary activities       679.19         3.29
 
 Less: Provision for diminu
 tion in value of investments, 
 loans and advances                 1,677.03         8.13
 
 PROFIT / (LOSS) AFTER TAX 
 (PAT)                               (997.84)       -4.84
 
 Add: Balance brought forward 
 from the previous year             3,046.18            -
 
 Profit available for 
 appropriation                      2,048.34            -
 
 Less: Proposed Equity 
 Dividend                                  -            -
 
 Less: Preference Dividend                 -            -
 
 Less: Final dividend for 
 previous year                         15.60            -
 
 Less: Tax on Proposed Equity 
 Dividend                               2.60            -
 
 Balance carried to next year        2030.14            - 
 
 Earnings Per share (EPS)
 
 - Basic before Extraordinary 
 items                                  7.71            -
 
 - Diluted before Extraordinary 
 items                                  7.66            -
 
 - Basic and Diluted after Extr
 aordinary items                      (11.33)           -
 
 
 
                                         (Rs. in Millions 
                                              except EPS)
 
                                                 % age to 
                                 Previous year      Total
 Particulars                        31.03.2011     Income               
                                  
                                                   
 
 Turnover                            18,235.41      96.93
 
 Other Income                           577.30       3.07
 
 Total Income                        18,812.71     100.00
 
 Profit before Interest, 
 Depreciation and Tax (PBIDT)         3,637.86      19.34
 
 PROFIT BEFORE TAX (PBT)              1,704.56       9.06
 
 Less: Provision for taxation           554.50       2.95
 
 PROFIT / (LOSS) AFTER TAX 
 (PAT) from ordinary activities       1,150.06       6.11
 
 Less: Provision for diminu
 tion in value of investments, 
 loans and advances                          -          -
 
 PROFIT / (LOSS) AFTER TAX 
 (PAT)                                1,150.06       6.11
 
 Add: Balance brought forward 
 from the previous year               2,001.65          -
 
 Profit available for 
 appropriation                        3,151.71          -
 
 Less: Proposed Equity 
 Dividend                                73.09          -
 
 Less: Preference Dividend               17.41          -
 
 Less: Final dividend for 
 previous year                               -          -
 
 Less: Tax on Proposed Equity 
 Dividend                                15.03          -
 
 Balance carried to next year         3,046.18          - 
 
 Earnings Per share (EPS)
 
 - Basic before Extraordinary 
 items                                   15.73          -
 
 - Diluted before Extraordinary 
 items                                   15.73          -
 
 - Basic and Diluted after Extr
 aordinary items                         15.73          -
 
 
 During the year under report, the Company registered a growth of 9.17%
 in Turnover. Further, the Company witnessed a fall of 18.92% in PBIDT,
 39.65% in PBT, and 186.76% in PAT over those in the previous year. The
 financial year 2010-11 was turbulent year for your Company. Steep
 increase in prices of cotton severely affected performance of global
 textile industry and this has resulted in reduced margins for your
 Company.
 
 Product wise Production, Sales and Capacity Utilisation were as under:
 
                           Towel                   Bed Sheets
                           (MT)                 (million Mtrs)
                    2010-11     2009-10        2010-11    2009-10
 
 Production       39,416.38   38,966.67          37.20      39.31
 
 Sales            36,035.21   36,284.19          37.50      39.93
 
 Capacity         41,500.00   41,500.00          45.00      45.00
 installed
 
 %age of Prod         94.98%      93.90%         82.67%     87.34%
 uction toCap
 acity
 
 Contribution 
 to sales(%)              21%        35%            18%        21%
 
                        Cotton Yarn                    Rugs
                           (MT)                        (MT)
                    2010-11     2009-10        2010-11      2009-10
 
 Production       31,737.82   31,387.30       5,078.87     2,921.96
 
 Sales               738.29    1,180.08       4,987.44     2,930.33
 
 Capacity         33,130.00   33,130.00      10,151.00    10,151.00
 installed
 
 %age of Prod         95.80%     94.74%         50.03%       28.78%
 uction to
 Capacity
 
 Contribution 
 to sales(%)             39%        40%            22%          29%
 
 
 II.  DIVIDEND
 
 On the back of struggling year witnessed by the Company, the Board of
 Directors did not recommend any dividend for the financial year 2010-11
 
 III. QUALITY AND RESEARCH & DEVELOPMENT
 
 Your Company continues to emphasize qualitative growth and believes
 that quality of its product has to be its strength in this complex
 market environment.  Your Company is committed to bring about positive
 change in each and every process and has a team fully focused on Research 
 & Development. Particulars of activities relating thereto have been 
 given in Annexure II here to.
 
 IV. DIRECTORS
 
 In the ensuing Annual General Meeting, Mr. Dadi B. Engineer and Mr. A.
 K. Dasgupta will be retiring by rotation and being eligible have
 offered themselves to be reappointed. Mr. Dadi B. Engineer and Mr. A.
 K. Dasgupta are independent directors. Further, details about these
 directors are given in the Notice of the ensuing Annual General Meeting
 being sent to the shareholders along with this report. The Board
 recommends their reappointment.
 
 V.  ENERGY, TECHNOLOGY AND FOREIGN EXCHANGE
 
 Information in accordance with the provisions of Section 217 (1) (e) of
 the Companies Act, 1956, read with Companies (Disclosure of Particulars
 in the Report of Board of Directors) Rules, 1988, regarding
 conservation of energy, technology absorption and foreign exchange
 earnings and outgo is given in the Annexure I forming part of this
 report.
 
 VI. SUBSIDIARY COMPANIES:
 
 The Ministry of Corporate Affairs vide its General Circular No. 2 /
 2011 dated 8th February, 2011 granted general exemption to companies
 from attaching a copy of the Balance Sheet, the Profit and Loss Account
 and other documents of their subsidiary companies as required to be
 attached under Section 212 of the Companies Act, 1956 to the Balance
 Sheet of companies subject to fulfillment of conditions stipulated in
 the circular. Therefore, the said Reports of the subsidiary companies
 viz. Welspun AG, Switzerland Welspun Mexico SA de CV, Mexico and Besa
 Developers and Infrastructure Private Limited, India, are not attached
 herewith. However, a statement giving certain information as required
 by the Ministry is placed along with the Consolidated Accounts.
 
 The Company shall provide a copy of Annual Report and other documents
 of its subsidiary companies as required under section 212 of the
 Companies Act to the shareholders upon their request, free of cost.
 
 VII. AUDITORS'' REPORT:
 
 Report of M/s. Price Waterhouse & Co., the Statutory Auditors, on the
 Audited Financial Statements of the Company for the financial year
 ended March 31, 2011 contains a qualification regarding the accounts
 receivables balance of Rs. 696.02 million (March 31, 2010: Rs. 475.93
 million) that is due from Welspun Retail Limited (WRL), a group
 company, as at March 31, 2011, in relation to which no valuation
 allowance has been estimated and adjusted in these financial statements
 which, in the statutory auditors'' view, does not meet the requirement
 to consider prudence in selection of accounting policies, as set out in
 Accounting Standard 1 – Disclosure of Accounting Policies, as WRL has
 been incurring significant losses (Rs.199.73 million for the year ended
 March 31, 2011 and Rs. 1,205.96 million as at March 31, 2011 basis its
 audited financial statements as of and for the year ended March 31,
 2011) and has also been unable to achieve its projected financial
 results in the previous and current financial reporting periods. The
 Company is of the view that, in order to turnaround WRL''s operations,
 WRL has made a robust plan for widening its reach in the market by
 using new marketing strategies with aggressive cost reduction programs.
 Accordingly, in the opinion of the Management, the aforesaid accounts
 receivable as at March 31, 2011 is considered good and recoverable.
 
 VIII. FIXED DEPOSIT
 
 During the year under review, your Company has not accepted any fixed
 deposit within the meaning of Section 58-A of the Companies Act, 1956
 and the Rules made thereunder.
 
 IX. EMPLOYEE STOCK OPTION SCHEME:
 
 The particulars required to be disclosed pursuant to Clause 12 of SEBI
 (Employee Stock Option Scheme and Employee Stock Purchase Scheme)
 Guidelines, 1999 are as under:
 
 On June 30, 2009, the Company issued 22,65,000 Employee Stock Options
 under the Employee Stock Options Scheme (the Scheme) to employees of
 the Company and its subsidiaries with a right to subscribe to equity
 shares at a price of Rs.  35.60 per equity share (closing market price
 as on June 30, 2009). The stock option can be exercised during a period
 of 3 years from the date of vesting. The dates of vesting of options
 are June 30, 2010 (20%), June 30, 2011 (20%), June 30, 2012
 (30%) and June 30, 2013 (30%).
 
 The Company has adopted intrinsic value method for the valuation and
 accounting of the aforesaid stock options as per SEBI guidelines. Since
 the grants were made at an exercise price equal to the closing market
 price at the time of grant, no amount was required to be accounted as
 employee compensation cost. The fair value of the options as per the
 Black Scholes model comes to Rs. 17.49 per option. Had the company
 valued and accounted the aforesaid options as per the Black Scholes
 model, the employee compensation cost would have been higher by Rs.
 9.11 mn, the Profit After Tax for the year would have been lower by Rs.
 6.27 mn, the basic loss per share would have been higher by Re. 0.07
 and diluted loss per share would have been higher by Re. 0.07,
 respectively.
 
 The Black Scholes model captures all the variables with their
 respective appropriateness which influences the fair value of stock
 options.  The significant assumptions to estimate the fair value of
 options as per Black Scholes model are :
 
 
                                   Vest 1           Vest 2 
                            June 30, 2010    June 30, 2011
 
 Variables                             20%              20%
 
 Stock Price                        34.85            34.85
 
 Volatility                         63.52%           59.33%
 
 Riskfree Rate                       6.15%            6.31%
 
 Exercise Price                     35.60            35.60
 
 Time to Maturity                    2.50             3.50
 
 Dividend Yield                      0.00%            0.00%
 
 
 
                                   Vest 3           Vest 4 
                            June 30, 2012    June 30, 2013
 
 Variables                             30%              30%
 
 Stock Price                        34.85            34.85
 
 Volatility                         54.45%           53.18%
 
 Riskfree Rate                       6.46%            6.61%
 
 Exercise Price                     35.60            35.60
 
 Time to Maturity                    4.50             5.50
 
 Dividend Yield                      0.00%            0.00%
 
 
 Mr. M. L. Mittal, Executive Director (Finance), being a senior
 management personnel has been granted 90,000 stock options.
 
 The other employees have been granted 21,75,000 options.  The details
 of options granted to the employees are:
 
 Total number of employees           :    82
 
 Max. number of options granted      :    22,65,000
 
 Avg. number of options granted      :    27,622
 
 Cumulative disclosure
 
 The particulars with regard to the stock options as on March 31, 2011
 as required to be disclosed under the SEBI''s guidelines are as 
 follows:
 
 Cumulative position as on March 31, 2011
 
 Nature of disclosure      Particulars
 
 a.  Options granted       22,65,000
 
 b. The pricing formula    The exercise price is Rs. 35.60 per equity 
                           share i.e. the latest available closing 
                           market price of share at the time of grant 
                           i.e.  June 30, 2009.
 
 c.  Options vested but    102 ,250
 not excercised and 
 not lapsed                   
 
 d.  Options exercised     283,750
 
 e. The total number of    Total number of shares arising as a result 
 shares arising as a res   of exercise of options shall be 22,65,000 
 ult of excise of Option   of Rs. 10/- each  
 
 f.  Options lapsed /
 surrendered               375,000
 
 g.  Variation of terms    -
 of Option 
 
 h.  Money realized by
 exercise of Options       Rs. 1,01,01,500
 
 i.  Total number of 
 Options in force          16,06,250
 
                           No. of Options granted     No. of Options
                                                      exercised
 
 (a) Details of options 
 granted to / exercised 
 the Whole-time 
 Directors
 
 j. 1.  Mr. M.L. Mittal    90,000                     18,000
 
 (b) Any other employee    NIL                        NIL
 who received a grant in 
 any one year of option 
 amounting to 5% or more 
 of options granted 
 during that year.
 
 
 K. Employees who were     NIL 
 granted options, 
 during any one year, 
 equal to NIL or exceed
 ing 1% of the issued 
 capital of the Company 
 at the time of
 grant
 
 l. Earnings Per Share 
 (EPS) of Option calcu
 lated in accordance 
 with 
 Accounting Standard 
 AS-20.
 
 Diluted before Extrao
 rdinary items             Rs. 7.66
 
 Basic and Diluted 
 after Extraordinary 
 items                    (Rs. 11.33)
 
 m. Weighted average 
 fair value of options.    Rs. 17.49
 
 
 As required by the provisions of Section 217(2A) of the Companies Act,
 1956 read with the Companies (Particulars of Employees) Rules, 1975 as
 amended, the names and other particulars of the employees are set out
 in the Annexure to the Directors'' Report. However, as per the
 provisions of Section 219(1)(b)(iv) of the Companies Act, 1956, the
 Report and Accounts is being sent to all the shareholders of the
 Company excluding the aforesaid information. Any shareholder interested
 in obtaining such particulars may write to the Company Secretary at the
 Registered Office of the Company.
 
 IX. DIRECTORS'' RESPONSIBILITY STATEMENT
 
 Pursuant to the requirement under section 217(2AA) of the Companies
 Act, 1956, with respect to Directors'' Responsibility Statement, it is
 hereby confirmed:
 
 (i) That in the preparation of the accounts for the financial year
 ended March 31, 2011, the applicable accounting standards have been
 followed along with proper explanation relating to material departures;
 
 (ii) That the Directors have selected such accounting policies and
 applied them consistently and made judgements and estimates that were
 reasonable and prudent so as to give a 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;
 
 (iii) 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;
 
 (iv) That the Directors have prepared the accounts for the financial
 year ended March 31, 2011 on a ‘going concern'' basis.
 
 X.  CORPORATE GOVERNANCE
 
 Your Company believes that Corporate Governance is a voluntary code of
 self-discipline. Your Company continuously endeavors to follow healthy
 Corporate Governance practices to nurture interest of all stakeholders
 in the Company.
 
 A separate report on Corporate Governance is annexed hereto as a part
 of this report. A certificate from a practicing company secretary
 regarding compliance of conditions of Corporate Governance as
 prescribed under Clause 49 of the Listing Agreement is attached to this
 report. Management Discussion and Analysis Report is separately given
 in the Annual Report.
 
 XI. ACKNOWLEDGEMENT
 
 Your directors express deep sense of appreciation for the assistance
 and co-operation received from the Financial Institutions, Banks,
 Government Authorities, creditors and Shareholders and for the devoted
 services rendered, by the Executives, Staff and Workers of the Company.
 
                                       For and on behalf of the Board
 
                               B.K. Goenka          R. R. Mandawewala
                               Executive Chairman   Managing Director
 
 Mumbai 
 May 30, 2011