Cera AR09

AS A L W A Y S , WE BRING YOU GREAT CURVES.
ANNUAL
REPORT
2008-09
SANITARYWARE I TILES | TAPS
M A D E IN ITALY
PRESENTED
BY
Cera Sanitaryware Limited

Board of Directors Shri Vikram Somany Shri Sajan Kumar Pasari Dr. Abraham Koshy Dr. K. N. Maiti Shri Ashok Chhajed Shri Shree Narayan Mohata Shri Vidush Somany Shri S. K. Nema Chairman-cum-Managing Director
Executive Director Wholetime Director
Bankers State Bank of India ICICI Bank Ltd.
Auditors M/s. H. V. Vasa & Co., Chartered Accountants, B-2, "Usha Kiran", Opp. Khanpur Gate, Ahmedabad - 380 001.
Registered Office 9, GIDC Industrial Estate, Kadi-382 715, Dist. Mehsana, Gujarat, India.
Works 1) 2) 9, GIDC Industrial Estate, Kadi-382 715, Dist. Mehsana, Gujarat. Wind Farms : a) Vill. Lamba & Patelka, Tal. Kalyanpur, Dist. Jamnagar, Gujarat. b) Vill. & Tal. Kalyanpur, Dist. Jamnagar, Gujarat. c) Vill. Kadoli, Tal, Abdasa, Dist. Kutchh, Gujarat.
Ahmedabad Office "Madhusudan House'", Opp. Navrangpura Telephone Exchange, Ahmedabad - 380 006.
Registrar & Share Transfer Agent MCS Limited, 101, Shatdal Complex, 1st Floor, Opp. Bata Show Room, Ashram Road, Ahmedabad - 380 009. Contents Notice Directors' Report Corporate Governance Report Auditors' Report Balance Sheet Profit & Loss Account Schedules 1 to 18 Cash Flow Statement General Business Profile Page No, 2 5 10 14 16 17 18 30 31
Annual General Meeting at 11.30 a.m. on Wednesday, the 16th day of September, 2009 at the Registered Office. 1
Annual Report 2008-2009

NOTICE
Notice is hereby given that the Eleventh Annual General Meeting of the Members of CERA SANITARYWARE LIMITED will be held at 11.30 a.m. on Wednesday, the 16th day of September, 2009 at the Registered Office of the Company at 9, GIDC Industrial Estate, Kadi - 382 715. Dist. Mehsana, to transact the following business: ORDINARY BUSINESS 1. To consider and adopt Audited Profit and Loss Account for the year ended 31st March, 2009 and Balance Sheet as at that date and the Directors' and Auditors' Reports thereon. To declare dividend on Equity Shares. To appoint a director in place of Shri Sajan Kumar Pasari, who retires by rotation and being eligible, offers himself for reappointment. To appoint a director in place of Shri Shree Narayan Mohata, who retires by rotation and being eligible, offers himself for reappointment. To appoint Auditors to hold office from the conclusion of this Annual General Meeting till the conclusion of the next Annual General Meeting and to fix their remuneration. 9, services of Dr. Kedar Nath Maiti, who is ceramic scientist and is a director on the Board of Directors of the company at fee in the range of Rs. 75,000/- - Rs, 1,80,000/- per month for rendering from time to time such advice and services as he may give in his capacity as a ceramic scientist. RESOLVED FURTHER THAT this resolution shall be deemed to confer the necessary authority to the Chairman-cumManaging Director and / or Executive Director at their discretion, to decide the remuneration within the above range as may be deemed fit and proper. To consider and, if thought fit, to pass with or without modification the following resolution as an ordinary resolution. RESOLVED THAT Shri Shailesh A. Trivedi appointed as an Additional Director of the Company by Board of Directors and who ceased to hold the office at this meeting u/s. 260 of the Companies Act, 1956 and in respect of whom the Company has received notice in writing u/s. 257 of the Companies Act, 1956 proposing his candidature for the office of the director be and is hereby appointed as director of the Company. RESOLVED FURTHER THAT Shri Shailesh A. Trivedi, Director appointed herein above be and is hereby appointed as an "Occupier" of the Company as defined under Section 2 of the Factories Act.
2. 3.
4.
5.
SPECIAL BUSINESS 6. To consider and, if thought fit, to pass with or without modification the following resolution as an ordinary resolution. RESOLVED THAT Shri Ashok Chhajed appointed as an Additional Director of the Company by Board of Directors and who ceased to hold the office at this meeting u/s. 260 of the Companies Act, 1956 and in respect of whom the Company has received notice in writing u/s. 257 of the Companies Act, 1956 proposing his candidature for the office of the director be and is hereby appointed as director of the Company. 7. To consider and, if thought fit, to pass with or without modification the following resolution as a special resolution. RESOLVED THAT Company hereby accords its consent and approval u/s. 314 (1) and other applicable provisions, if any, of the companies Act, 1956, to Smt. Smiti Somany, a relative of Shri Vikram Somany, CMD and Shri Vidush Somany, ED of the Company, who holds an office or place of profit under the company, for holding and continuing to hold an office or place of profit as Sr. Manager - Marketing services in the Company in the scale of Rs. 25,000/- - Rs. 45,000/- p.m. together with other allowances and benefits as applicable to other employees of the Company but total remuneration including all allowances and benefits shall not exceed Rs. 48,000/- p.m. RESOLVED FURTHER THAT this resolution shall be deemed to confer the necessary authority to the Board of Directors and / or Head - Marketing Department at their discretion, to give increments within the grade as may be deemed fit and proper. 8. To consider and, if thought fit, to pass with or without modification the following resolution as a special resolution. RESOLVED THAT pursuant to section 3.14 (1) and other, applicable provisions, if any of the Companies Act, 1956, and subject to the opinion/consent of the Central Government the company do hereby accord consent to the retaining of the 2
Regd. Office: 9, GIDC Industrial Estate, Kadi-382 715 16th July, 2009
By Order of the Board of Directors Narendra N. Patel G. M. & Company Secretary
NOTES 1. A MEMBER ENTITLED TO ATTEND AND VOTE IS ENTITLED TO APPOINT PROXY TO ATTEND AND VOTE INSTEAD OF HIM SELF AND SUCH PROXY NEED NOT BE A MEMBER OF THE COMPANY. Members are requested to notify immediately the change of address, if any, to the Company or M/s. MCS Limited, Registrar and Share Transfer Agent. The Register of Members and Share transfer book of the Company will remain closed from 01.09.2009 to 16.09.2009 (both days inclusive). The Board of Directors has recommended a dividend of Rs. 2.00 per fully paid equity share of Rs.5/- each for the year ended 31.03.2009. Members / Proxies should bring the attendance slip sent herewith duly filled in for attending the meeting. Members are requested to send their queries atleast ten days before the date of the meeting so that the information can be made available at the meeting. Explanatory Statement pursuant to Section 173 (2) of the
2.
3.
4.
5.
6.
7.
companies act, 1956 is annexed hereto.

8. As per the provisions of Section 205 of the Companies Act, 1958 the dividend can be paid to the bankers of the Shareholder or any other authorized person. The,Shareholders who want to make the Payment of dividend to any other person or banker may send the authority to the Company on or before 15.08.2009 with details of number of shares held, amount of dividend, L.F. No. / DPID and name of the person / bank to whom the payment is to be made. Shareholders holding shares in Electronic Form may note that their bank account details as furnished by their depositories to the Company will be printed on their dividend warrants as per the applicable regulations of the depositories and the Company will not entertain any direct request from such shareholders for deletion of / change in such bank details. Shareholders who wish to change such bank account details are, therefore, requested to advise their Depository Participants about such change, with complete details of bank account. 10. All the documents, if any, referred to in this notice and explanatory statement are available for inspection of the members at the registered office of the Company on any working day except Saturday, between 11:00 a.m. to 1:00 p.m. up to the conclusion of this meeting.
9.
11.
Brief resumes of directors, proposed to be appointed / re-appointed at this meeting are given below: Shri Sajan kumar Pasari 21.02.1947 15.06.2004 Businessman Regent Estates Ltd. Bajrang Factory Ltd. Assam Roofing Ltd. India Automobiles (1960) Ltd. The Chamong Tea Co. Ltd. Merrygold Properties Pvt. Ltd. Kiwi Estates Pvt. Ltd. Parmeshwar Estates Pvt. Ltd. I A Builders Pvt. Ltd. I A Property Developers Pvt. Ltd. Shri Shree Narayan Mohata 03-12-1944 07-05-2005 Administration/Commercial Madhusudan Industries Ltd. Madhusudan Holdings Ltd. Shri Ashok Chhajed 20-09-1960 30-07-2008 Financial Management Shri Shailesh Trivedi 14-12-1950 26-06-2009 Administration/ Commercial Madhusudan Cybernetic Pvt. Ltd.
Name of Director Date of Birth Date of Appointment Expertise in Specific Functional Areas List of other Directorships
Chairman / Member of the Committees of the Board of other Companies Shareholding in the Company
1,22,570
250
300
Explanatory Statement pursuant to Section 173(2) of the Companies Act, 1956.
Item No. 7
Under section 314(1) of the Companies act, 1956, special resolution is required for enabling a relative of director of the Company holding office or place of profit under the Company. Smt. Smiti Somany, a relative of directors, has joined your company's office on 01.06.2006 as Advisor - Marketing services on a monthly salary of Rs. 8,000/plus some allowances. She is promoted as Sr. Manager- Marketing Services w.e.f. 01.04.2009, carrying monthly salary in the grade of Rs.25,000/- - Rs, 45,000/- p.m., but total remuneration shall not exceed Rs.48,000/- per month. She is wife of Shri Vikram Somany, CMD and mother of Shri Vidush Somany, ED. Under the provision of section 314 of the Companies Act, 1956, she will be deemed to hold office or place of profit. Pursuant to the provisions of Director's Relatives (Office or Place of profit) Rules, 2003 her remuneration shall not exceed Rs.50,000/- per month without obtaining prior approvals of members and Central government. Accordingly, in terms of section 314 (1) of the Act, the members are requested to grant their consent to Smt. Smiti Somany holding and continue to hold office or place of profit with the Company as per the 3
Item No. 6
The Board of Directors has appointed Shri Ashok Chhajed as an additional director w.e.f. 30.07.2008 and 12.09.2008 u/s. 260 of the Companies Act, 1956. As per the provisions of the said section he will hold office till this Annual General Meeting, However, being eligible for re-appointment he offers himself for the same. The Company has also received notice alongwith deposit of Rs. 500/- from a member of the Company signifying his intention to propose Shri Ashok Chhajed being appointed as director of the Company under the provisions of Section 257 of the companies Act, 1956. It is in the interest of the Company to have the benefit of the services of Shri Ashok Chhajed, as director, who is expert in financial management. Your directors commend the resolution as per item no. 6 of the notice for passing by members. Except, Shri Ashok Chhajed, none of your directors is concerned or interested In the said resolution.

resolution. The members are also requested to authorise Board of Directors and / or Head - Marketing department to sanction in due course promotion of Smt, Smiti Somany to the next higher grade together with allowances and benefits not exceeding Rs. 48,000/per month. Your directors commend the resolution as per item no. 7 of the notice for passing by members. Except, Shri Vikram Somany and Shri Vidush Somany, none of your directors is concerned or interested in the said resolution. Item No. 8 Dr. Kedar Nath Maiti, M.Tech, Ph.D., FIMMM, Chartered Scientist (UK) is a well known ceramic scientist having rich experience in ceramic industry due to his long tenure in Central Glass and Ceramic Research Institute (CGCRI). His extraordinary acumenship and scientific attitude will certainly help the company to a great extent. He was requested by the Company to assist the R & D department for development of a new body and glazes to meet the international standards in Sanitaryware industry as well as to reduce the cost of production. After great persuasion, he agreed to make his services available to the company. He has been working on the said assignment since May 2007, He has undertaken trial of more than 50 formulations at R & D level and has been successful In some areas and still working relentlessly on the said project. He will also undertake other projects after completion of present assignment. He is working at a very meager remuneration of Rs. 75,000/- per month. It is proposed to pay him remuneration upto Rs, 1,80,000/per month over a period of 5 years upto 31.03.2014, depending upon his valuable and expert services, results attained by him and Its impact on overall efficiency and performance of the Company. The Central Government in its letter dated 16.02.2009 has expressed the opinion under provision to Sub-section (1) of Section 309 of the Companies Act, 1956 that Dr. Kedar Nath Maiti has the requisite qualification for rendering professional services to the Company upto 31,03.2009. The Company has again applied to the Central Government for expressing its opinion that Dr. Kedar Nath Maiti possesses qualification necessary for rendering professional services and payment of remuneration upto Rs. 1,80,000/- per month for five years from 01.04.2009 to 31.03.2014. Reply from Central Government is awaited. Letter received from the Central Government dated 16.02.2009 is available for Inspection at the registered office of the company. Your directors commend the resolution as per item no, 8 of the notice for passing by members. Except, Dr. Kedar Nath Maiti, none of your directors Is concerned or interested in the said resolution. Item No. 9 The Board of Directors has appointed Shri Shailesh A. Trivedi as an additional director w.e.f, 26.06.2009 u/s, 260 of the Companies Act, 1956, As per the provisions of the said section he will hold office till this Annual General Meeting. However, being eligible for re-appointment he offers himself for the same. The Company has also received notice alongwith deposit of Rs. 500/- from a member of the Company signifying his intention to propose Shri Shailesh A. Trivedi being appointed as director of the Company under the provisions of Section 257 of the companies Act, 1956, It is in the interest of the Company to have the benefit of the services of Shri Shailesh A. Trivedi, as director, who is expert in administration. He is also appointed as an "Occupier" of the Company u/s. 2 of the Factories Act. Your directors commend the resolution as per Item no, 9 of the notice for passing by members. Except, Shri Shailesh A. Trivedi, none of your directors is concerned or interested in the said resolution.
Regd. Office : 9, GIDC Industrial Estate, Kadi-382 715 16th July, 2009
By Order of the Board of Directors Narendra N. Patel G. M. & Company Secretary
Cera Sanitaryware Limited Directors' Report

To The Members, The Directors have pleasure in submitting the Annual Report together with the Statement of Accounts of your Company for the year ended 31st March, 2009. Performance The summary of your Company's financial performance is given below: (Rs. in lacs) Year ended Year ended March 31, 2009 March 31, 2008 Profit before Depreciation and Taxes & Exceptional item Deducting there from Depreciation Profit before tax & Exceptional Item Less: Exceptional Item Profit before Tax Deducting there from taxes of: Current Tax Fringe Benefit Tax Deferred Tax Profit after Tax Add: Balance brought forward from previous year Amount available for Appropriations The proposed appropriations are: 1. Proposed Dividend 2. Tax on Proposed Dividend 3. General Reserve 4. Balance carried forward Total Sanitaryware Unit Despite the global recession and its consequential effect on India and the slowdown in Indian reality sector, your Company was able to increase the sales by 25%, whereas the estimated industry growth was far less. Your Company increased the production capacity from 16,500 MTPA to 24,000 MTPA in the last financial year. Also, it continued its efforts to improve productivity and quality. The marketing thrust to make the brand and product visible at the retail level has helped your Company perform well, despite the housing construction showing a downward trend. CERA is perceived as a "value-for-money" brand, because of which more and more Institutional buyers and developers have commenced using CERA. Power Unit The non-conventional wind power generation in the year was 59,65,534 KWH against 44,66,638 KWH in the previous year. The installed capacity of wind power unit of the company is 4.975 M.W. Management Discussion and Analysis Report (a) Industry Structure and Developments The 50-year old, Rs.1,000 crore Sanitaryware industry in India is going through a metamorphosis, with several foreign brands 5 (d) 124.22 21.11 965.52 800.00 1910.85 92.78 15.77 798.36 600.00 1504.91 (c) 508.05 31.69 138.79 1310.85 600.00 1910.85 215.50 16.51 316.90 1004.91 (b) 500.00 1504.91 2746.39 592.81 2153.58 163.20 1990.38 2047.96 494.14 1553.82 eyeing India as a potential market and developers and traders looking at China as a source for cheaper Sanitaryware. Some of the foreign brands have commenced production in India, while some are establishing offices in India, apart from those who have already got well-established in this country in the past few years. Added to this is innumerable small scale industries located mainly in Gujarat, manufacturing low-end Sanitaryware. Those in the organized sector, like your Company, are only a few. In order to Increase the topline and bottomline and also to cash in on the equity of CERA brand, your Company has ventured into other bathroom related products like showers, tubs, etc. mainly sourced from reputed manufacturers. Apart from this, your Company has also started retailing premium Italian designer tiles in North India through its showroom Cera Vogue in Delhi. Your Company is also planning a major foray into taps, another major product category in the bathroom solutions. The test marketing done, through outsourced products, has shown encouraging results. In this category, there is one strong Indian brand, followed by a few me-too brands. Your company has tied up with an Italian wellness major, Novellini SpA, among largest wellness products in the world to launch premium wellness product range in India soon. The product range consists of steam cubicles, massage bath tubs, equipped panels, etc. Opportunities and Threats The housing construction, though on a temporally slowdown pace currently, is expected to take a growth curve soon in India. Even in the times of recession, because of CERA being value for money brand, your Company was able to sustain the healthy growth rate. Outlook Your Company has a strong brand equity and loyal distribution network, Your Company is also making all out efforts to make increase the visibility of the brand and product even in smaller towns, where there is huge untapped potential.. Your Company is also fortifying its relationship with developers. Thus your Company is confident of increasing the growth rate in the coming years. The continuous efforts to improve quality and productivity have put your company on par with the comparable International companies. The innovations of the past by your company, like one-piece WCs and water-saving twin-flush cisterns have today become industry norms. Your company's growth continues to be much above the industry growth, year after year, which is testimony to its product quality and marketing success. The successful display centre concept of your company, introduced through Cera Bath Studios in several cities, is now being extended In the form of Cera Bath Galleries with its retail partners. In Cera Bath Gallery, the customers can not only touch and feel the Cera range, but also can purchase it. After its success in Delhi, this year, Cera Bath Galleries will come up in several towns across the country. Risks and Concerns Any drastic change in the Government Policy may affect the Sanitaryware manufacturers,
1553.82

(e) Infernal Control Systems and their adequacy The Company has adequate system of Internal control relating to the purchase of stores, raw materials, plant & machineries, equipments and various components and for the sale of goods commensurate with the size of the Company and the nature of business. The system of internal control of the Company is adequate keeping in mind the size and complexity of your Company's business. Systems are regularly reviewed to ensure effectiveness. (f) (g) Financial performance with respect to operational performance is discussed in the main part of the Report. Material Developments in Human Resources / Industrial Relations Faced with the economical dilemna of the times, the thrust this year has been on talent acquisition and improving the mind share in the industry. The Company has emerged as am equal opportunity and progressive employer in the industry. On the whole, all the efforts have been towards aligning your Company with the global norms, with a mix of progressive and welfare activities viz. training and development, motivation, re-skilling and others so that your Company is seen as a preferred employer in the industry. The Company continues to invest in training and development of its employees and has been organizing various training programme from time to time. (h) Preferential Allotment Till the year end, the company allotted 2,60,000 equity shares to promoters in pursuance to 6,00,000 preferential warrants granted to them. These proceeds have been utilized towards expansion programme and long term working capital of the Company. The balance preferential warrants have not been subscribed by them, hence lapsed. (i) Employees Stock Option Scheme Pursuant to the authority of the members granted at the Extra - ordinary General Meeting of your Company held on 6th January, 2007, the company has framed the Employees Stock Option scheme 2007 (ESOS - 2007). Accordingly, NIL (previous year 15,000) options were granted to the eligible employees during the year under review. During the year 75,060 (previous year 70,631) options were vested with the eligible employees. During the year 25,850 options were exercised and equal number of equity shares have been issued under the scheme. Details required to be provided pursuant to clause 12 of the Securities and Exchange Board of India (Employees Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999 are set out in Annexure to this Report. Corporate Governance Pursuant to Clause 49 of the Listing Agreement with the Stock Exchanges, Report on Corporate Governance along with the Auditors' statement on its compliance has been included in this Annual Report as a separate section. Directors' Responsibility Statement In compliance of Section 217 (2AA) of the Companies Act, 1956, the Directors of your Company confirm: that the applicable accounting standards have been followed in the preparation of final accounts and that there are no material departures: 6 that such accounting policies have been selected and applied consistently, and such judgements 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 at March 31, 2009, and of the profit of the Company for the year ended on that date; that 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; that the annual accounts have been prepared on a going concern basis.
Dividend
Your Directors recommend a dividend of 40 % (Rs.2.00 per share) (Previous year 30%, Rs..1.50 per share) on 62,10,864 (Previous year 61,85,014) Equity Shares of Rs, 5/- each fully paid for the year ended 31.03.2009, to be paid subject to approval by the members at the ensuing Annual General Meeting, Energy Conservation, Technology Absorption, R & D Cell and Foreign Exchange Earnings & Outgo The details required under the Companies (Disclosure of particulars in the Report of Board of Directors) Rules, 1988 are annexed to this report. Exchequer The Company has contributed Rs. 27.55 Crores to the exchequer by way of excise duty, customs duty, income tax, VAT, sales tax, and other fiscal levies, Fixed Deposit Fixed deposits from the Public, outstanding as on 31.03.2009 was Rs.,15.55 lacs. There were 14 Fixed Deposit holders with Rs 3.80 Lacs of unclaimed / unrenewed deposits as on 31.03.2009. The Company, on the basis of the working results during the year under review can accept deposits from the Public as well as from the shareholders to the extent of Rs. 2,471.67 lacs. Finance During the year under review, the Company repaid loans of Rs.440.50 Lacs to Financial Institutions and the Government of Gujarat. Employees Information as per sub-section (2A) of Section 217 of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 forming part of the Directors' Report for the year ended 31st March, 2009 is annexed. Directors Shri S. C. Kothari has retired as Whole-time Director w.e.f. 13.08.2008. Your Board of Directors places on record its appreciation for the contribution made by him to the company, Shri Ashok Chhajed has been appointed as additional Director w.e.f. 12.09.2008. Shri Sajan Kumar Pasari and Shri Shree Narayan Mohata are due to retire at the end of ensuing Annual General Meeting and being eligible offered themselves for reappointment. Brief resumes of directors proposed to be appointed/re-appointed, as required under clause 49 of the Listing Agreement executed with
the Stock Exchanges are provided in the notice convening the Annual
General Meeting of the Company.

Auditors M/s. H. V. Vasa & Co., Statutory Auditors of the company retire at the end of forthcoming Annual General Meeting and being eligible, offered themselves for re-appointment. The Board recommends their re-appointment at the ensuing Annual General Meeting. Insurance The Company has adequately insured all its properties including Plaint and Machinery, Building and Stocks. Industrial Relations The Company's relations with its employees remained cordial throughout the year. The directors wish to place on record their deep appreciation for the services rendered by workers, staff members and executives of the Company. For and on behalf of the Board of Directors, Ahmedabad 28th May, 2009 Vikram Somany Chairman-cum-Managing Director The Company has taken adequate steps for the health and safety of its employees, as required under the Gujarat Factories Rules, 1963. Appreciation Your Directors thank the Financial Institutions and Bankers for extending timely assistance in meeting the financial requirements of the Company. They would also like to place on record their gratitude for the co-operation and assistance given by State Bank of India, ICICI Bank Limited, and various departments of both State and Central Governments.
A n n e x u r e to the Directors' Report Information to be disclosed under the Securities and Exchange Board of India (Employee Stock Option Scheme and Employee Stock Purchase Scheme) Guidelines, 1999. (a) (b) (c) (d) (e) (f) (g) (h) (i) (j) Options Granted The Pricing Formula Options Vested Options Exercised The total number of shares arising as a result of exercise of options Options lapsed Variation of terms of options Money realized by exercise of options Total number of options in force Employee wise details of options granted to : i) Senior managerial personnel ii) Any other employee who received a grant in any one year of options amounting to 5% or more of options granted during that year. iii) Identified employees who were granted options, during any one year, equal to or exceeding 1 % of the issued capital (excluding outstanding warrants and conversions) of the Company at the time of grant. Diluted Earning Per Share (EPS) pursuant to issue of shares on exercise of option calculated in accordance with Accounting Standard (AS) 20 "Earnings Per Share" Where the Company has calculated the employee compensation cost using the intrinsic value of the stock options, the difference between the employee compensation cost so computed and the employee compensation cost that shall have been recognized if it had used the fair value of the options. The impact of this difference on profits and on EPS of the company. Weighted - average exercise prices and weighted average fair values of options shall be disclosed separately for options whose exercise price either equals or exceeds or is less than the market price of the stock. A description of the method and significant assumptions used during the year to estimate the fair values of options, including the following; weighted-average information: i) risk free interest rate ii) expected life iii) expected Volatility iv) expected dividend v) The price of the underlying share in market at the time of option grant 7 2,26,878 Stock options granted were priced at Rs, 61/- per share excluding FBT. 75,060 25,850 2,68,000 equity shares of Rs, 5/- each will arise on exercise of options 14,413 Nil Rs. 15.77 lacs 1,98,738 No option granted during the year. Nil
Nil
(k)
Rs. 21.15
(I)
(m)
The Company has calculated the employee compensation cost using the intrinsic value of stock options. Had the fair value method been used, in respect of stock options granted, the employee compensation cost would have been lower by Rs. 40.58 (Rs. 122.31) lacs, Profit after tax higher by Rs. 26.78 (Rs. 80.73) Lacs and the basic and diluted earning per share would have been higher by Rs. 0.65 (Rs. 1.31) and Rs.0.43 (Rs. 1.29) respectively. Not Applicable
(n)
Black-Scholes Model
8% 24 Months 32% 18% Rs. 140.80 & Rs. 190.05

A n n e x u r e t o the D i r e c t o r s ' R e p o r t Disclosure of particulars with respect to Conservation of Energy, Technology Absorption, Foreign Exchange Earnings and Outgo as required under the Companies (Disclosure of particulars in the Report of Board of Directors) Rules, 1988 and forming part of the Report of the Board of Directors for the year ended 31st March, 2009, A. Energy Conservation Form - A : Not Applicable B. Technology Absorption Form B Research and Development (R & D) 1. Specific areas in which R & D is carried out The Company's Research & Development Unit is recognized by the Department of Scientific and Industrial Research, Government of India, since 1993. It has been constantly working for improvement in quality of products to keep company ahead in market competition. R & D Centre was successful in the following areas : Development of new white glaze for shuttle kiln suitable for once fire. Development of white and ivory glaze matching with American standard. Development of Magenta Red Glaze to improve its quality. Development of white glaze matching with Canadian White. Developed Zirconium Silicate from Indian sources replacing imported one. Working to develop body of Sanitaryware with fired pitcher to reduce waste, cost & pollution. 2. 3. Benefit derived as a result Future plan of action With the introduction of new sources and import substitution of raw materials, colours & stains the cost of wares has reduced. To minimize imports by developing substitution in India for better inventory management and cost reduction. To develop glazes for matching quality of reputed International brands.
4.
Expenditure on R & D a) b) c) d) Capital Recurring Total Total R & D Expenditure as a percentage of total turnover
Rs. 17.64 Lacs Rs. 33.16 Lacs Rs. 50.80 Lacs 0.32% Nil
Technology Absorption, Adaptation & Innovation C. Foreign Exchange earnings and outgo
The Company has continued to maintain focus and avail of export opportunities based on economic considerations. During the year the Company has exports (FOB) worth Rs. 421.69 Lacs. Total foreign exchange used Total foreign exchange earned Rs.1575.94 Lacs Rs. 421.69 Lacs

A n n e x u r e to the Directors' Report Information as per Section 217(2A) read with the Companies (Particulars of Employees) Rules, 1975 and forming part of the Directors' Report for the year ended 31st March, 2009. A. Names of Employees employed through out the year and were in receipt of remuneration of not less than Rs.24,00,000/during the year: Sr. No. Name & Age (Years) Designation/ Nature of Duties Remuneration (Rs.) Qualifications & Experience(Years) Date of commencement of employment (6) 13.08.2002 Last Employment, Name of employer, Post held and period (Years) (7) Madhusudan Industries Limited Chairman-cumManaging Director (1 year)
(1) 1
(2) Shri Vikram Somany (59 years)
(3) Chairman-cumManaging Director
(4) Rs.53,85,604
(5) B.Sc, FCMI (U.K.) (35 years)
Shri Vidush Somany (28 years)
Executive Director
Rs.24,34,805
Bachelors Degree in Management Studies (U.S.A.) (4 years) B.E (Mech.), PGDM (IIM-A) (26 years) B.E. (Mech.) (35 years)
15.06.2004
Shri Santoshkumar Nema (50 years)
CEO - cum Whole-time director
Rs.90,13,696
24.05.2007
Samsons Group of Companies Group President Marketing (4 years) Willard India Limited - V. P (Operations) (3 years)
Shri M.K.Bhandari (57 years)
President (Works)
Rs.32,49,526
13.06.1992
B. Names of Employees employed for part of the year and were in receipt of remuneration of not less than Rs.2,00,000/- per month: Sr. No. Name & Age (Years) Designation/ Nature of Duties Remuneration (Rs.) Qualifications & Experience (Years) Date of commencement of employment (6) 01.06.1985 Last Employment, Name of employer, Post held and period (Years) (7) CCDC Construction Pvt. Ltd. (1 year)
(1) 1
(2) Shri Subhash Chandra Kothari (64 years)
(3) Sr. Whole-time director
(4) Rs.55,48,491
(5) B.Com., LLB, FCA (40 years)
Notes : 1. Gross remuneration as above includes Salary, Company's contribution to Provident Fund, Leave Encashment, Leave Travel Reimbursement, Medical Expenses Reimbursement, House Rent Allowance, Housing Accommodation and Monetary value of perquisites calculated in accordance with the provisions of Income Tax Act, 1961 and Rules made thereunder. Shri Vikram Somany is father of Shri Vidush Somany, Executive Director of the Company.
2.
Annual Report 2008-2009.

Annexure to the Directors' Report CORPORATE GOVERNANCE REPORT
(As required by Clause 49 of the Listing Agreement of the Stock Exchanges) 1) Company's Philosophy The Company believes in the practice of good Corporate Governance and acting as a good corporate citizen. The spirit of Corporate Governance has been prevailing in the Company. The Company believes in the values of transparency, professionalism and accountability. The Company recognizes the accountability of the Board and importance of its decisions on Its customers, dealers, employees, shareholders, and with every individual, who comes In contact with the Company. 2) Board of Directors The Board comprises of a Chairman-cum-Managing Director, a Executive Director, a Whole Time Director and five non-executive directors. The Company did not have any pecuniary relationship or transactions with the non-executive directors during the period under review. During the year, six Board Meetings were held - on 11.04.2008, 24.05.2008, 30.07.2008, 12.09.2008, 20.10.2008 and 19.01.2009. None of the directors on the Board are members In more than ten committees and they do not act as Chairmen of more than five committees across all companies in which they are directors. The composition of Directors and their attendance at the Board meetings during the year and at the last Annual General Meeting as also number of other directorships and Committee Memberships are given below:
Sr. Name of No, Director Category of Directorship No.of Atten- No. of No.of Board dance Other Other Meetings At last director- Committee attended AGM ships Memberships
3)
Audit Committee The Audit Committee, consists of 6 (Six) directors, namely Shri Ashok Chhajed - Chairman (Independent), Shri Vikram Somany. Shri S. K. Pasari (independent), Shri S, N. Mohata (independent), Dr. Abraham Koshy (independent) and Dr. K. N. Maiti (independent). During the year, four Audit Committee Meetings were held i.e. on 23.05.2008, 30.07.2008, 20.10.2008 and 19.01.2009. Terms of reference: The role and terms of reference of the Audit Committee cover the matters specified for Audit Committees under Clause 49 of Listing Agreement and Section 292A of the Companies Act, 1956.
4)
Remuneration Committee The Remuneration Committee, consists of four independent directors namely, Shri S. N. Mohata - Chairman, Shri S. K. Pasari, Shri Ashok Chhajed and Dr. Abraham Koshy. The Committee fixes the Remuneration of Whole Time Directors, which include all elements of remuneration package i.e. salary, benefits, bonus, pension, retirement scheme and such other benefits. The Committee also decides the fixed component and performance linked incentives, performance criteria, service contracts, notice period, severance fees etc. of the remuneration package of working directors, as may be necessary. During the year under review, two meetings were held on 11.04.2008 and on 24.05.2008.
5)
Remuneration Policy Remuneration of employees largely consists of basic remuneration and perquisites. The component of the total remuneration varies for different grades and is governed by Industry pattern, qualifications and experience of the employee, responsibilities handled by him and his individual performance, etc.. The objectives of the remuneration policy are to motivate employees to excel in their performance, recognize their contribution and to retain talent in the organization and accord merit. Employees Stock Option Scheme (ESOS) The company had introduced Employees Stock Option Scheme (ESOS 2007) for the employees of the Company.
1. 2. 3. 4. 5. 6. 7. 8. 9.
Shri Vikram Somany Shri Vidush Somany Shri S. C, Kothari * Dr. Abraham Koshy Dr. K. N. Maiti ** Shri Ashok Chhajed *** Shri Sajan Kumar Pasari
Chairman-cumManaging Director Executive Director Sr. Whole Time Director Non-Executive Director Non-Executive Director Non-Executive Director Non-Executive Director
Shri Shree Narayan Mohata Non-Executive Director Shri Santosh Kumar Nema + Whole Time Director
6 8 2 1 1 1 2 3 2
YES YES NO N O YES YES NO NO YES
1 4 1
10 2 1
6)
Details of remuneration for the year ended 31.03.2009 (i) Managing Director / Wholetime Director(s) Name Salary (Rs.) Perquisites and Retirement benefits (Rs.) 9,45,604/-
* ** *** +
retired w.e.f. 13.08.2008. appointed w.e.f. 24.05.2008. appointed w.e.f. 30.07.2008. appointed w.e.f. 01.07.2008.
Code of Conduct The Company has finalized model code of conduct for the Board members and senior Officers of the Company. The code of conduct has been posted on the website of the Company www.cera-india.com CEO/CFO certification As per clause 49 of listing agreement entered with the stock exchanges, a certificate from CEO/CFO has been obtained. Whistle Blower Policy The Company has not implemented a whistle-Blower policy.
Shri Vikram Somany Chairman-cumManaging Director Shri Vidush Somany Executive Director Shri S. C. Kothari * Sr. Whole Time Director
44,40,000/-
18,84,000/18,11,998/-
5,50,805/3,98,903/11,54,693/-
Shri Santosh Kumar Nema** 48,88,400/Whole Time Director * Retired w.e.f. 13.08.2008. ** appointed w.e.f. 01.07.2008
10

The Company has entered into contract with the above directors. Their appointments are for a period of 3 years. The Whole Time Directors, except Chairman-cumManaging Director and Executive Director may resign from the services of the Company by giving three months notice in advance. Similarly, the Company has the right to terminate the services of Whole Time Director/s at any time by giving three months notice in writing. The Whole Time Directors are also entitled to the benefits as per the Rules of the Company which the other employees / executives of the Company are entitled to. 15,000 Stock Options were granted to Shri S. K. Nema, when he was COO of the Company. He is appointed as CEO-cum-Whole Time Director w.e.f. 01.07.2008. During the year, 10,000 options were vested to Shri S C Kothari, Sr. Whole Time Director and 5,000 options were vested to Shri S. K. Nema, Whole Time Director of the Company. 15,000 equity shares have been allotted to Shri S. C. Kothari under Employees Stock Option Scheme pursuant to his retirement. ESOS does not form a part of contract with the Company. The Whole Time Directors are not entitled to the sitting fees for attending the Board Meetings. (ii) Non-Executive Directors Remuneration by way of sitting fees for attending Board / Committee Meetings have been paid to the non-executive directors up to 24.05.2008. The company has passed the resolution at the Annual General Meeting held on 12.09.2008 for the payment of commission not exceeding 1% p.a. of the net profit of the Company. The commission will be distributed among the directors not in whole time employment of the Company in such manner, as the Board of directors may determine from time to time. The details of remuneration paid /to be paid to them for the year 2008-09 are as under: Name Shri D. P. Goyal* Dr. Abraham Koshy Dr. K. N. Maiti** Shri Sajan Kumar Pasari Shri Shree Narayan Mohata Shri Ashok Chhajed*** Total Sitting Fees (Rs.) 4,000 Commission + (Rs.) 7) Compensation Committee Board of Directors has formed compensation committee for formulation and administration of Employees Stock Option Scheme. The Compensation Committee consists of three directors, Shri S. N. Mohata - Chairman, Shri S. K. Pasari and Shri S. K. Nema. During the year under review, three meetings were held on 13.08.2008,11.09.2008 and 10.01.2009. 8) Share Transfer Committee In accordance with the Listing Agreement with the Stock Exchanges, the Board had delegated the powers of share transfers to the Share Transfer Committee. In order to expedite the process of share transfers / transmissions/ splits / consolidation, the Committee meets at least once in a fortnight The Share transfer committee, consists of three directors namely Shri S. K. Nema - Chairman, Shri Vidush Somany and Dr. K. N. Maiti. Share Transfer Agent The Company has appointed M/s. MCS Limited, Ahmedabad, a SEBI registered Share Transfer Agent as Registrar and Share Transfer Agent w.e.f. 01.03.2003. 9) Shareholders' / investors" Grievance Committee The Shareholders' / Investors' Grievance Committee, consists of three directors namely Shri S. K. Nema - Chairman, Shri Vidush Somany and Dr. K. N. Maiti. All investor complaints, which cannot be settled at the level of Company Secretary and Compliance Officer, are forwarded to the Shareholders'-Grievance Committee for final settlement. During the year 2008-09, the Company had received 32 complaints / queries from the Shareholders. All the complaints received from the Shareholders were resolved. There is no complaint pending as of 31.03.2009, which is not attended / replied by the Company. The Company confirms that there were no share transfers lying pending as on date which were received upto 31.03.2009 and all requests for dematerialisation and rematerialisation of shares as on that date were confirmed / rejected into the NSDL/ CDSL system. During the year, one meeting was held on 24.05.2008. 10) General Body Meetings The last three Annual General Meetings were held as under: Financial Year ended Date Time Venue
1,00,000
4,000
1,00,000 1,00,000 1,00,000 4,00,000
* resigned w.e.f. 24.05.2008 ** appointed w.e.f. 24.05.2008 ***appointed w.e.f. 30.07.2008 + on approval of accounts by the members at ensuring AGM (iii) Shareholding of Non-Executive Directors Name No, of Shares held 1,22,570 Nil Nil 250 300 % of total shareholding 1.97 Nil Nil 0.00 0.00
31.03.2008 12.09.2008 11.30 a. m. 9, GIDC Industrial Estate Kadi-382 715, Dist. Mehsana. 31.03.2007 26.09.2007 11.30 a. m. 9, GIDC Industrial Estate Kadi-382 715, Dist. Mehsana, 31.03.2006 30.06.2006 11.30 a. m. 9, GIDC Industrial Estate Kadi-382 715, Dist. Mehsana. 11) Disclosures 1. There were no transactions of material nature with the directors or the management or their subsidiaries or relatives etc. during the year, which could have potential conflict with the interests of the Company at large.
Shri Sajan Kumar Pasari Dr. Abraham Koshy Dr. K. N. Maiti* Shri Shree Narayan Mohata Shri Ashok Chhajed** * appointed w.e.f. 24.05.2008 ** appointed w.e.f. 30.07.2008.
11

2. There were no instances of non-compliance of any matter related to the capital market, during the last three years. Limited. The company has paid listing fees for the year 2008-09 and 2009-10 to the Stock Exchanges. Stock Code;Trading Symbol - Bombay Stock Exchange Limited: 532443 CERASANITDM. Trading Symbol-National Stock Exchange of India Ltd. : CERA. 6. Share price at BSE and NSE Month High (Rs.) April 2008 May 2008 June 2008 July 2008 August 2008 September 2008 October 2008 November 2008 December 2008 January 2009 February 2009 March 2009 7. Share Transfer Entire Share Transfer work and dematerialisation / rematerialisation work is assigned to R & T Agent, M/s. MCS Limited, Ahmedabad, a SEBI registered Share Transfer Agent. Request for Share transfer, dematerialisation and rematerialisation should be sent directly to M/s. MCS Limited, 101, Shatdal Complex, 1st Floor, Opp. Bata Show Room, Ashram Road, Ahmedabad380 009. Shareholders have option to open their accounts with either NSDL or CDSL as the Company has entered into agreements with both of these depositories. 14) Share Transfer System The share transfer/s is normally effected within a period of 15-20 days from the date of receipt, provided the documents being complete in all respects. The Company has formed Share Transfer Committee of directors, which meets atleast once in a fortnight for effecting transfer of shares and other related matters. 15) Distribution of Shareholding as on 31.03.2009 No. of shares 1 501 1001 2001 3001 4001 5001 500 1000 2000 3000 4000 5000 10,000 50,000 No. of Shareholders 5054 98 47 15 6 6 10 22 3 14 5275 Total No. of Shares 595725 77672 71839 36562 21941 28825 83927 677237 227358 4389778 6210864 134.70 136.00 133.00 142.00 155.00 153.85 108.50 81.90 84.00 77.15 64.75 63.95 BSE Low (Rs.) 110.25 120.05 110.00 110.00 117.25 94.30 64.60 53.10 50.60 55.20 55.15 53.00 NSE High Low (Rs.) (Rs.) 144.50 148.00 139.90 139.95 145.00 138.65 120.00 84.50 75.30 75.00 62.95 62.95 110.00 120.00 105.80 109.00 120.20 100.00 61.50 54.00 54.00 59.00 55.95 53.45
12) Means of Communication 1. Quarterly results are published in leading daily newspapers viz. Financial Express / Economic Times / Indian Express and a local language newspaper viz. Jai Hind/ Loksatta / Financial Express/ Economic Times. The annual results (annual reports) are posted to all the members of the Company, Management Discussion & Analysis forms part of this annual report, which is also being posted to all the members of the Company. The official news releases, if any, are given directly to the press. The Company uploads its financial results, Shareholding pattern and other information on the EDIFAR website maintained by National Informatics Center (NIC), which can be accessed through the website of the Securities and Exchange Board of India (SEBI): http:/www.sebi.gov.in. This information is also made available by the Bombay Stock Exchange Limited, Mumbai on website http:// www.bseindia.com and by National Stock Exchange of India Limited on website http://www.nseindia.com.
2.
3. 4.
13) General Shareholders' Information 1. Annual General Meeting Date and Time : Venue 2. : : 16th September, 2009 :11.30 a.m. 9, GIDC Industrial Estate, Kadi - 382 715, Dist. Mehsana.
Financial Calendar 2009-10 (tentative): Annual General Meeting 3rd / 4th week of September, 2010 July, 2009 October, 2009 January, 2010
Results for quarter ending By last week of June 30, 2009 September 30,2009 December 31, 2009
Results for year ending 3rd / 4th week of June, 2010 March 31, 2010 (Audited) 3. 4, Book Closure date Dividend Payment - Dividend for the year ended 31.03.2009 will be paid to the members whose names will appear in the register of members of the Company, on 16.09.2009 after giving effect to all valid transfer of shares in physical form lodged with the Company on or before 31st August, 2009 and - in respect of shares held in demat form, the members whose names appear on the statement of beneficial ownership furnished by NSDL and CDSL at the end of business hours on 31st August, 2009. - Dividend will be paid within 30 days from the date of approval by the members at the Annual General Meeting. 5. Listing on Stock Exchanges The Company's shares are listed at Bombay Stock exchange Limited and National Stock Exchange of India 1.09.2009 to16.09.2009. (both days inclusive)
10,001 And above Total
50,001 -1,00,000
12

16) Pattern of Shareholding as on 31,03.2009 Sr, No. 1. 2. 3. 4. 5. 6. Category NRI Financial Institutions/ Banks Mutual Funds Promoters Body Corporate Others Total No. of Shares 109713 2725 325 3397980 844222 1855899 6210864
(%)
1.77 0.04 0.01 54.71 13.59 29.88 100.00
18) Plant Locations The Company's plants are located at the following places: 1. 2. 9, GIDC Industrial Estate, Kadi - 382 715, Dist. Mehsana, Gujarat. Wind Farms; 1. Village Patelka & Lamba, Taluka Kalyanpur, District Jamnagar, Gujarat 2. Village & Taluka Kalyanpur, District Jamnagar, Gujarat. 3. Vill. Kadoli, Tal. Abdasa, District Kutchh, Gujarat 19) Address for Correspondence The Company's Registered Office is situated at 9, GIDC Industrial Estate, Kadi-382715, District Mehsana, Gujarat. Shareholders' correspondence should be addressed either to the Registered Office of the Company as stated above and/or to the Ahmedabad Office of the Company at "Madhusudan House", Opp. Navrangpura Telephone Exchange, Ahmedabad - 380 006 or to the Registrar and Share Transfer Agent, M/s. MCS Limited, 101, Shatdal Complex, 1st Floor, Opp. Bata Show Room, Ashram Road, Ahmedabad-380009.
17) Dematerialisation of Shares as on 31.03.2009 As on 31.03.2009, 81.28% of the Company's total shares representing 50,48,311 Shares were held In dematerialized form and the balance 18.72% representing 11,62,553 shares were In paper form. The ISIN Number in NSDL and CDSL is "INE 739E01017".
AUDITOR'S CERTIFICATE To, The Members of Cera Sanitaryware Limited We have examined the compliance of conditions of Corporate Governance by Cera Sanitaryware Limited, for the year ended 31st March, 2009, as stipulated in Clause 49 of the Listing Agreement of the said Company with Stock Exchange(s), The compliance of conditions of Corporate Governance is the responsibility of the management. Our examination was limited to procedures and implementation thereof, adopted by the Company for ensuring the compliance of the conditions of the Corporate Governance. It is neither an audit nor an expression of opinion on the financial statements of the Company. In our opinion and to the best of our information and according to the explanations given to us, we certify that the Company has complied with the conditions of Corporate Governance as stipulated in the above mentioned Listing Agreement. As required by the Guidance Note issued by the Institute of Chartered Accountants of India, we have to state that no investor grievances were pending for a period of one month against the Company as per the records maintained by the Shareholders'/ Investors' Grievance Committee. We further state that such compliance is neither an assurance as to the future viability of the company nor the efficiency or effectiveness with which the management has conducted the affairs of the Company. For and on Behalf of H. V. Vasa & Co. Chartered Accountants Tushar H. Vasa Proprietor Membership No. 16831
Ahmedabad 28th May, 2009
13

Auditors' Report to the Members
We have audited the attached Balance Sheet of CERA SANITARYWARE LIMITED, as at 31st March, 2009 and also the Profit and Loss Account and the Cash Flow Statement of the Company for the year ended on that date annexed thereto. These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit in accordance with auditing standards generally accepted in India. Those Standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion. As required by the Companies (Auditor's Report) Order, 2003 issued by the Central Government of India in terms of sub-section (4A) of Section 227 of the Companies Act. 1956, we enclose in the annexure a statement on the matters specified in paragraphs 4 and 5 of the said Order, Further to our comments in the Annexure referred to in the paragraph above, we report that: (1) We have obtained all the information and explanations which, to the best of our knowledge and belief, were necessary for the purpose of our audit; (2) in our opinion, proper books of accounts as required by law, have been kept by the Company so far as appears from our examination of those books; (3) The Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report comply with the Accounting Standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956; (4) The Balance Sheet, Profit and Loss Account and Cash Flow Statement dealt with by this report are in agreement with the books of accounts; (5) As per the written representation made by the directors as on 31st March, 2009 and taken on record by the Board of Directors and the information and explanations given to us, none of the Directors is, as at 31st March, 2009, prima-facie disqualified from being appointed as Director in terms of clause (g) of subsection (1) of Section 2:74 of the Companies Act, 1956; (6) In our opinion and to the best of our information and according to explanations given to us, the said accounts read with significant accounting policies and other notes thereon in Schedule 18, give the information required by the Companies Act, 1956, in the manner so required and give a true and fair view in conformity with the accounting principles generally accepted in India: (a) in so far as it relates to the Balance Sheet, of the state of affairs of the Company as at March 31, 2009 and (b) in so far as It relates to the Profit and Loss Account, of the profit of the Company for the year ended on that date. (c) In case of Cash Flow Statement, of the cash flows for the year ended on that date. For and on Behalf of H. V, Vasa & Co, Chartered Accountants Tushar H. Vasa Ahmedabad Proprietor th 28 May, 2009 Membership No. 16831 14 2. Annexure to the Auditors' Report As required by the Companies (Auditors' Report) Order, 2003, issued by the Central Government of India in terms of Section 227(4A) of the Companies Act, 1956, we have annexed hereto a statement on the matters specified in paragraphs 4 and 5 of the said Order. 1. In respect of its fixed assets: a. The Company has maintained proper records, showing full particulars including quantitative details and situation of its fixed assets on the basis of available information, other than furniture and fixtures. As explained to us, the fixed assets have been physically verified by the management during the year in a phased periodical manner, which in our opinion is reasonable, having regard to the size of the Company and the nature of its assets. No material discrepancies between the book records and the physical inventory have been noticed in respect of the assets physically verified. In our opinion, there was no substantial disposal of fixed assets during the year, which would affect the going concern of the company.
b.
c.
In respect of its inventories : a. As explained to us, inventories have been physically verified by the management at regular intervals during the year. In our opinion and according to the information and explanations given to us, the procedures of physical verification of inventories followed by the management are reasonable and adequate in relation to the size of the Company and the nature of its business, The Company has maintained proper records of inventories. As explained to us, there were no material discrepancies noticed on physical verification of inventory as compared to the book records,
b.
c.
3.
In respect of loans, secured or unsecured, granted or taken by the Company to / from companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act, 1956: a. The Company has not granted any loans, secured or unsecured to companies, firms or other parties covered in the register maintained under Section 301 of the Companies Act 1956. As the company has not granted any loans secured or unsecured, to parties listed in the register maintained under Section 301 of the Companies Act, 1956, paragraphs 4 (iii)(b), (c) and (d) of the Order are not applicable. The Company had taken unsecured loans aggregating to Rs. 144 Lacs from three companies covered In the register maintained under Section 301 of the Act. The maximum amount involved during the year was Rs, 228 Lacs and at the year end balance of loans taken from such companies was Rs. 144 Lacs, In our opinion and according to the information and explanations given to us, the rate of interest and other terms and conditions on which the loans have been taken from companies listed in the register maintained under Section 301 of the Companies Act, 1956 are not, prima facie, prejudicial to the interest of the Company,
b.
c.

4. In our opinion and according to the information and explanations given to us, there are adequate internal control systems commensurate with its size of the Company and the nature of business for the purchase of inventory, fixed assets and also for sale of goods and services. Further, on the basis of our examination, and according to the information and explanations given to us, we have neither come across nor have been informed of any instance of major weaknesses in the aforesaid internal control systems. In respect of transactions covered under Section 301 of the Companies Act, 1956: a. In our opinion and according to the information and explanations given to us, the particulars of contracts or arrangements referred to In Section 301 of the Companies Act, 1956 have been entered into in the register maintained under that section. In our opinion and according to the information and explanations given to us, the transactions made in pursuance of such contacts or arrangements and exceeding the value of Rupees Five Lakhs In respect of any party during the year have been made at prices which are reasonable having regard to the prevailing market prices at the relevant time. 12. been deposited with the appropriate authorities on account of any dispute. 10. The Company does not have accumulated losses at the end of the financial year and has not incurred any cash losses during the financial year covered by our audit or in the Immediately preceding financial year. As per the books and records maintained by the company and according to the information and explanation given to us, we are of the opinion that the Company has not defaulted in repayment of dues to bank. In our opinion and according to the information and explanation given to us, no loans and advances have been granted by the Company on the basis of security by way of pledge of shares, debentures and other investments. In our opinion, the Company is not a chit fund or a nidhi / mutual benefit fund/ society. Therefore, clause 4(xii) of the Companies (Auditor's Report) Order 2003 is not applicable to the Company. In our opinion and according to the information and explanations given to us, the Company has not dealt in or is trading in shares, securities, debentures and other investments. The company has invested surplus funds in marketable securities and mutual funds. According to the information and explanation given to us, proper records have been maintained of the transactions and contracts and timely entries have been made therein. The investments in marketable securities and mutual funds have been held by the company in Its own name. According to the information and explanations given to us, the Company has not given guarantee for loans taken by others from banks, In our opinion and according to the information and explanations given to us, the term loans have been applied for the purpose for which they were raised. According to the cash flow statement and other records examined by us and the information and explanations given to us, on an overall examination of the Balance Sheet of the Company, we report that no funds raised on short term basis have been used for long term investment (fixed assets, etc.). During the year, the Company has not made any preferential allotment of shares to parties and companies covered in the Register maintained under Section 301 of the Companies Act, 1956. As the Company has not issued any debentures, paragraph (xix) of the order is not applicable to the company. The Company has not raised any money by way of public issue during the year. In our opinion and according to the information and explanations given to us, no fraud on or by the Company has been noticed or reported during the year, that causes the financial statements to be materially misstated. For and on Behalf of H. V. Vasa & Co. Chartered Accountants Ahmedabad 28 th May, 2008 Tushar H. Vasa Proprietor Membership No. 16831
11.
5.
13.
b.
14.
6.
In our opinion and according to the information and explanations given to us, the Company has complied with the provisions of Sections 58A, 58AA or any other relevant provisions of the Companies Act, 1956 and Companies (Acceptance of Deposit) Rules, 1975 with regard to the deposits accepted from the public. According to the information and explanations given to us, in this regard, no order under the aforesaid sections has been passed by the Company Law Board or National Company Law Tribunal or Reserve Bank of India or any Court or any other Tribunal on the company. In our opinion, the internal audit system of the Company is commensurate with its size and the nature of its business. According to the Information and explanations given to us, the Central Government has not prescribed the maintenance of cost records under clause (d) of sub-section (1) of Section 209 of the Companies Act, 1956 in respect of goods manufactured by the Company. In respect of statutory dues: a. According to the records of the Company, undisputed statutory dues including Provident Fund, Investors Education and Protection Fund, Employees' State Insurance, Income-Tax, Sales-tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and other statutory dues have been generally regularly deposited with the appropriate authorities. There are no dues on account of Cess under Section 441A of the Companies Act 1956 since the aforesaid section has not yet been made effective by the Central Government of India. According to the information and explanations given to us, no undisputed amounts payable in respect of the aforesaid dues were outstanding as at 31st March, 2009 for a period of more than six months from the date of becoming payable. According to the information and explanations given to us, there are no material dues of Income Tax, Sales Tax, Wealth Tax, Service Tax and Cess which have not
15.
16.
7. 8.
17.
18.
9.
19. 20. 21.
b.
15
Annual Report 2008-2009.

Balance Sheet as at 31st March, 2009
31-3-2009 Schedule I. Sources of Funds 1, Shareholders' Funds (a) (b) 2. Share Capital Reserves & Surplus 1 2 3,10,54,320 67,51,36,718 70,61,91,038 Loan Funds: (a) (b) 3, II. Secured Loans Unsecured Loans 3 4 34,71,38,992 1,88,56,238 36,59,95,230 Deferred Tax Liability (Net) Total Application of Funds 1. Fixed Assets : (a) (b) (c) (d) 2. 3, Gross Block Less : Depreciation Net Block Capital Work-in-progress 6 7 8 9 26,85,26,627 30,69,30,845 21,63,63,814 58,92,483 10 10,05,16,026 89,82,29,795 Less : Current Liabilities & Provisions (a) (b) Liabilities Provisions 11 12 32,68,64,272 10,86,48,933 43,55,13,205 46,27,16,590 4. Miscellaneous Expenditure (To the extent not written off or adjusted) Total Notes forming part of the Accounts 18 1,20,88,40,047 1,10,18,21,773 8,53,399 31,18,62,263 6,46,65,811 37,65,28,074 33,62,61,868 10,78,746 5 98,77,86,508 24,46,42,292 74,31,44,216 21,12,592 74,52,56,808 Investments Current Assets, Loans & Advances (a) (b) (c) (d) (e) Inventories Sundry Debtors Cash & Bank Balances Other Current Assets : Interest accrued on deposits Loans & Advances 61,53,642 7,62,94,379 71,27,89,942 26,60,12,627 25,70,39,022 10,72,90,272 13,250 94,19,91,885 18,64,44,578 75,55,47,307 89,20,602 76,44,67,909 13,250 13,66,53,779 1,20,88,40,047 31,62,49,126 7,47,31,288 39,09,80,414 12,26,75,220 1,10,18,21,773 3,51,07,070 55,30,59,069 58,81,66,139 Rs. Rs. Rs. 31-3-2008 Rs.
As per our report of even date attached For and on behalf of H. V. Vasa & Co. Chartered Accountants Tushar H. Vasa Rajesh B. Shah - C.F.O. Proprietor Narendra N. Patel Membership No. 16831 G.M. & Company Secretary Ahmedabad 28th May, 2009 Ahmedabad 28th May, 2009
Vikram Somany Vidush Somany Ashok Chhajed Dr. K. N. Maiti S. K. Nema
Chairman-cum-Managing Director Executive Director Director Director Whole time Director
16

Profit and Loss Account for the year ended 31st March, 2009
2008-09 Schedule Income Sales Less : Excise Duty Net Sales Other Income Increase (Decrease) in Finished Goods and Work-in-process Expenditure Raw materials consumed Purchases Payments to and provision for Employees Other Expenses Interest: on Term Loans on Others Depreciation Total Expenditure Profit before taxation & Exceptional Item Less : Exceptional Item (Refer Note 12 of Schedule 18) Profit before taxation Provision for taxation Current Tax Deferred Tax Fringe Benefit Tax Profit after Taxation Add : Surplus brought forward from previous year Profit Available for Appropriations Appropriations Proposed Dividend Tax on Proposed Dividend Transferred to General Reserve Balance Carried to Balance Sheet Notes forming part of the Accounts No. of Equity Shares (Face Value Rs. 5/- each) - Basic Basic earning per share (in Rs.) No. of Equity Shares (Face Value Rs. 5/- each) - Diluted Diluted earning per share (in Rs.) As per our report of even date attached" For and on behalf of H. V. Vasa & Co. Chartered Accountants Tushar H. Vasa Rajesh B, Shah - C.F.O. Proprietor Narendra N. Patel Membership No. 16831 G.M. & Company Secretary Ahmedabad Ahmedabad 28th May, 2009 28th May, 2009 17 18 61,99,249 21.15 61,99,249 21.15 Vikram Somany Vidush Somany Ashok Chhajed Dr. K. N. Maiti S. K. Nema 61,41,735 16.36 62,56,273 16.06 Chairman-cum-Managing Director Executive Director Director Director Whole time Director 1,24,21,728 21,11,073 9,65,52,781 8,00,00,000 19,10,85,582 92,77,521 15,76,715 7,96,36,356 6,00,00,000 15,04,90,592 5,08,05,000 1,39,78,559 31,69,262 13,10,85,582 6,00,00,000 19,10,85,582 2,15,50,000 3,16,90,426 16,51,000 10,04,90,592 5,00,00,000 15,04,90,592 1,70,54,71,404 11,02,28,934 1,59,52,42,470 1,90,20,662 1,61,42,63,132 14 89,94,390 1,62,32,57,522 15 16 17 2,28,05,196 1,68,53,909 3,96,59,105 5,92,81,214 1,40,78,99,144 21,53,58,378 1,63,19,975 19,90,38,403 13,04,48,718 46,96,01,924 23,64,79,006 47,24,29,177 1,47,75,096 1,69,45,723 3,17,20,819 4,94,13,779 1,19,44,37,009 15,53,82,018 1,39,36,45,345 11,31,42,124 1,28,05,03,221 2,37,08,470 1,30,42,11,691 4,56,07,336 1,34,98,19,027 13,08,96,839 38,31,79,546 20,15,12,200 39,77,13,826 2007-08 Rs. Rs.
Rs.
Rs.
13
15,53,82,018

Schedules 1 to 18 Annexed to And Forming Part of The Accounts As At 31st March, 2009
31-3-2009 Rs. 1. Share Capital Authorised 2,00,00,000 (2,00,00,000) Equity shares of Rs. 5/- each Total Issued, Subscribed & Paid Up (61,85,014) Equity shares of Rs, 5/- each fully paid up Of the above 53,75,000 Equity Shares allotted as fully paid pursuant to the scheme of arrangement. Of the above 2,60,000 (1,50,000) Equity Shares of Rs. 5 each fully paid were issued at Premium against conversion of Preferential warrants.
31-3-2008 Rs. Rs. Rs,
10,00,00,000 10,00,00,000
10,00,00,000 10,00,00,000 3,09,25,070
62,10,864
3,10,54,320
3,10,54,320 NOTE : # Options in force as of March 31,2009 under the Employees Stock Option Scheme 2007- 1,98,738 Shares (Previous Year - 2,26,878 Shares) # # # # Vested Options Exercisable @ Rs,61/- per share (Excl. FBT) till 09.07.2009 - 30,368 Shares Vested Options Exercisable @ Rs.61/- per share (Excl. FBT) till 09.07.2010 & 09.07.2011 - 65,060 Shares each. Vested Options Exercisable @ Rs.61/- per share (Excl. FBT) till 09.07.2012 - 5,000 Shares Options Exercised till March 31, 2009 - 25,850 shares NIL (3,40,000) Preferential Warrants to subscribe Equity Shares @ Rs. 123/- per share. Rs. 12.30 per each warrant (See note no. 5 of Schedule 18) Total
3,09,25,070
1(A).
3,10,54,320
41,82,000
3,51,07,070
2.
Reserves and Surplus General Reserve As per last Balance Sheet Less: Adjustments as per amended provisions of AS-11 (See note -13 of Schedule -18) Add : Transferred from Profit and Loss Account
36,82,38,276 -41,62,953 9,65,52,781 46,06,28,104
28,86,01,920
7,96,36,356 36,82,38,276 10,02,00,000
Share Premium Account As per last Balance Sheet Add : Forfeiture of Preferential Warrants (See note - 5 of Schedule -18) Add :; Received/Transferred during the year
11,31,80,000 41,82,000 14,47,600 11,88,09,600
1,29,80,000 11,31,80,000 1,78,75,280 19,35,750 -9,67,416 1,88,43,614 -72,02,821 1,56,99,014 8,00,00,000 67,51,36,718 1,16,40,793 6,00,00,000 55,30,59,069
Employees Stock Options Outstanding As per last Balance Sheet Addition during the year Deletion during the year Less : Deferred Employee Compensation Cost (See note - 6 of Schedule-18) Profit and Loss Account Total 18
1,88,43,614
-11,50,158 1,76,93,456 -19,94,442

31-3-2009 Rs. 3. Secured Loans From Banks Cash / Packing Credit (see note 1) T e r m Loans (see note 2) 9,59,21,765 25,12,17,227 34,71,38,992 Total Notes : 1. Credit facilities from Banks are secured by hypothecation of Goods, Book Debts, all movable assets and Second Charge by way of mortgage of Fixed Assets of the Company and guarantee of a Director, 2. Term Loans by Banks are secured by mortgage of Fixed Assets situated at 9, GIDC Industrial Estate and Residential Colony at Kadi, display centres and hypothecation of its movable assets. 34,71,38,992 9,64,90,649 21,97,58,477 31,62,49,126 31,62,49,126 31-3-2008
Rs.
Rs.
Rs.
4.
Unsecured Loans Fixed Deposits Interest Accrued and Due 15,55,000 37,906 15,92,906 Inter Corporate Loans Short Term Loans from Bank Other Loans & Advances 1. From Banks - Finance Lease - Vehicles (Secured by lien on vehicles acquired on finance lease) 2. Interest Free Loan (Sales-tax) from Govt. of Gujarat 28,73,332 22,31,605 1,43,90,000 54,68,000 1,43,734 56,11,734 2,28,00,000 4,00,00,000
28,73,332 1,88,56,238
40,87,949 63,19,554 7,47,31,288
Total
5.
Fixed Assets Gross Block As at 1-4-2008 Additions Deductions/ Adjustments As at 31-3-2009 As at 31-3-2008 Depreciation For the Deductions/ year Adjustments As at 31-3-2009 Net Block As on 31-3-2009 As on 31-3-2008
Name of Assets Sr. No.
1.
Land - Lease Hold - Free Hold Hold 16,45,514 36,33,677 17,22,88,715 70,22,85,953 1,07,59,686 1,380 1,68,193 3,53,89,400 1,58,19,367 94,19,91,885 63,33,19,261
46,80,909 2,96,67,627
59,870
15,85,644 36,33,677 17,69,69,624 73,19,53,580 1,07,59,686 1,380 1,86,568 4,20,65,988 2,06,30,361 98,77,86,508 94,19,91,885
Buildings
3. Plant & Machinery 4. Electric Plant & Installation
5. Laboratory Equipments 6, Weighing Machinery 7. Furniture, Fixtures & Equipments 8. Vehicles Total Previous Year
18,375 67,91,088 65,21,707 4,76,79,706 31,19,34,312
1,14,500 17,10,713 18,85,083 32,61,688
3,34,34,048 13,02,93,255 13,53,841 949 76,282 1,59,19,577 53,66,626 18,64,44,578 13,88,62,235
1,22,68,152 3,76,18,250 5,67,295 66 14,123 57,23,619 30,89,709 5,92,81,214 4,94,13,779
- 15,85,644 - 36,33,677 - 4,57,02,200 13,12,67,424 - 16,79,11,505 56,40,42,075 - 19,21,136 88,38,550 98,638 9,84,862 1,015 90,405 2,15,44,558 74,71,473 365 96,163 2,05,21,430 1,31,58,888
16,45,514 36,33,677 13,88,54,667 57,19,92,698 94,05,845 431 91,911 1,94,69,823 1,04,52,741 75,55,47,307
10,83,500 24,46,42,292 74,31,44,216 18,31,436 18,64,44,578 75,55,47,307
19

31-3-2009 Rs. 6. Investments (At Cost) A. Government Securities : (Unquoted) (Deposited with Government Departments) National Savings Certificates B. Non-trade other investments (Unquoted) In fully paid Equity Shares of Rs. 50/- each 5 (5) Shares of Shivalik Co. Op. Hsg. Soc. Ltd. Total Aggregate Book Value - Quoted - Unquoted Aggregate Market Value - Quoted 250 13,250 250 13,250 13,250 13,000 13,000 Rs. Rs. 31-3-2008 Rs.
13,250
7.
Inventories (Certified and valued by a Director) (At lower of cost or net realisable value) Stores, Chemicals & Coal etc. Raw Materials Finished Goods Stock-in-process Total 3,38,56,350 2,84,55,992 20,06,54,594 55,59,691 26,85,26,627 3,86,50,339 3,01,42,393 19,10,30,159 61,89,736 26,60,12,627
8.
Sundry Debtors (Unsecured-Considered Good) A. B, Debts outstanding for a period exceeding 6 months Others Total 3,05,47,577 27,63,83,268 30,69,30,845 1,80,28,041 23,90,10,981 25,70,39,022
9.
Cash and Bank Balances A. B. Cash on Hand Balances with Scheduled Banks: On Current Accounts On Unclaimed Dividend Accounts On Fixed Deposit Accounts Total 3,78,10,067 8,85,018 17,71,80,726 21,58,75,811 21,63,63,814 3,83,83,345 6,32,006 6,78,43,266 10,68,58,617 10,72,90,272 4,88,003 4,31,655
10.
Loans and Advances (Unsecured-considered Good) Advances recoverable in cash or in kind or for value to be received Advance payment of Income-tax Balances with Excise Authorities Total 20 4,73,25,035 4,69,69,086 62,21,905 10,05,16,026 4,20,42,440 2,29,59,648
1,12,92,291
7,62,94,379

31-3-2009 Rs. 11, Current Liabilities Sundry Creditors Advance from Customers Unclaimed Dividend * Deposits by Dealers Interest accrued but not due Total * These figures do not include any amount, due and outstanding, to be credited to Investors Education & Protection Fund. 28,01,15,604 1,33,91,897 8,85,018 3,23,12,968 1,58,785 32,68,64,272 26,76,78,194 1,09,53,204 6,32,006 3,23,96,812 2,02,047 31,18,62,263
RS.
31-3-2008
Rs.
Rs.
12.
Provisions For Taxation Proposed Dividend Tax on Dividend For Retirement/Post Retirement Benefits and other employee benefits Total 6,06,39,395 1,24,21,728 21,11,073 3,34,76,737 10,86,48,933 2,53,06,211 92,77,521 15,76,715 2,85,05,364 6,46,65,811
2008-09 Rs. 13. Other Income Interest (Non Trade Investments) (Gross) 1. 2. On Government Securities From Others (including tax deducted at source Rs. 16,44,284/- previous year Rs. 16,68,752) Dividend (Gross) Export Incentives CVD Refund Claims Received Profit on Sale of Assets Miscellaneous Income Items pertaining to previous years Unspent liabilities and provisions no longer required written back (net) Total 714 79,23,214 79,23,928 714 80,44,346 Rs. Rs.
2007-08 Rs.
80,45,060 7,77,622
2,81,898 29,54,229 40,13,415 45,811 32,49,906 5,51,475 1,90,20,662
37,79,426
53,04,663 58,01,699 2,37,08,470
14.
Increase (Decrease) in Finished Goods and Work-in Process Stock at Commencement Finished Goods Stock in Process Stock at Close Finished Goods Stock in Process 20,06,54,594 55,59,691 20,62,14,285 89,94,390 21 19,10,30,159 61,89,736 19,72,19,895 4,56,07,336 19,10,30,159 61,89,736 19,72,19,895 14,65,27,211 50,85,348 15,16,12,559
Total

2008-09 Rs. 15. Raw Materials Consumed Opening Stock Add: Purchases (Net of transfers) Less: Closing Stock Total 3,01,42,393 12,87,62,317 15,89,04,710 2,84,55,992 13,04,48,718 2,17,37,743 13,93,01,489 16,10,39,232 3,01,42,393 13,08,96,839 Rs. Rs, 2007-08 Rs,
16.
Payments to and Provision for Employees Salaries, Wages and Bonus Contribution to Provident and other funds Staff and Labour Welfare Expenses Total 20,78,99,659 1,96,38,189 89,41,158 23,64,79,006 17,31,66,885 1,80,74,585 1,02,70,730 20,15,12,200
17.
Other Expenses Stores, Spare Parts and Packing Materials Excise Duty (Net of Opening Provision) Rent (Net) Power and Fuel Repairs to: Buildings Plant and Machinery Others Insurance Rates and Taxes Freight and Forwarding Expenses (net) Brokerage, Commission and! discounts on Sales Publicity & Advertisement Expenses Research & Development Expenses Miscellaneous Expenses Loss on sale of Fixed Assets Donations Directors' sitting Fees Directors' Commission Total 17,74,429 1,06,03,261 23,57,642 1,47,35,332 47,75,728 6,40,376 8,72,99,654 8,55,55,304 4,71,75,985 33,15,804 8,05,59,403 18,93,805 1,90,27,838 27,48,705 2,36,70,348 45,71,723 4,24,768 4,88,81,314 5,91,01,195 4,55,58,364 55,15,116 6,55,49,018 3,01,184 2,02,100 26,000 7,99,45,224 -19,65,202 1,43,37,206 4,98,38,263 6,95,61,467 89,71,955 73,44,205 5,80,35,069
58,12,100 4,000 4,00,000 47,24,29,177
39,77,13,826
22

18. 1. Notes forming part of the Accounts for the year ended 31st March, 2009. Significant Accounting Policies * Basis of Accounting The Company prepares its financial statements on accrual basis in accordance with generally accepted accounting principles and comply with the Accounting Standards referred to in Section 211 (3C) of the Companies Act, 1956.
*
*
Sales
Sales include excise duty and net of discounts and sales-tax. Retirement Benefits (i) (ii) (iii) Contribution to Provident Fund is made at applicable rates. Contribution to approved Gratuity Fund is made of the present liability for future Gratuity as determined on an actuarial valuation. The Company has no further obligation except contribution to the fund. Leave encashment benefit is accounted for on the basis of actuarial valuation.
Employees Stock Option Scheme

In accordance with the Securities and Exchange Board of India guidelines, the excess of the Market Price of the shares at the date of grant of options under the Employees Stock Option Scheme, over the exercise price is treated as Employee Compensation and amortised over the vesting period.
Fixed Assets, Depreciation and Amortisation (a) Fixed Assets transferred on demerger scheme are stated at cost-less accumulated depreciation. Acquisitions and additions are stated at cost. The Company capitalizes all costs relating to the acquisition and installation of Fixed Assets on net of MODVAT credits on the assets and adjustments arising from exchange rate variations attributable to the fixed assets are capitalised. Capital work in progress :: Projects under commissioning and other capital work in progress are carried at cost, comprising direct cost, related incidental expenses and attributable interest, Assets acquired under hire purchase installment credit scheme, the cost of asset is capitalized while the annual financial charges at equated instalments are charged to revenue. Depreciation for the year has been provided on net asset value at the rates and in the manner specified in Schedule-XIV of the Companies Act, 1956 as under: (1) On Plant & Machinery and Electric Plant & Installation on straight-line method ,but on incremental cost arising on account of translation of foreign currency liabilities for acquisition of fixed assets and depreciation is provided as aforesaid over the residual life of the respective assets. (2) On other assets on written down value method. (e) (f) Leasehold land is amortized over the period of lease. In respect of other assets taken on lease before 01.04.2001, the value thereof is not capitalized, but the contracted lease rentals are charged to revenue on accrual basis. The value of discarded Plant and Machinery has been written down to the lower of net book value and net realizable value. Raw-materials, packing materials, stores and chemicals are taken at lower of cost and net realizable value following FIFO method. Stock-in-Process is valued at lower of cost and net realizable value. Finished goods are valued at lower of cost and net realizable value. Excise duty on goods manufactured by the Company and remaining in inventory is included as a part of valuation of finished goods.
(b) (c) (d)
Inventories (a) (b) (c) (d)
* *
Investments Investments are stated at cost. Foreign Currency Transactions Foreign currency transactions during the year are recorded at rates of exchange prevailing on the date of transaction. Gains and losses resulting from the settlement of such transactions and from the translation of monetary assets and liabilities denominated in foreign currencies are recognised in the profit and loss account. Exchange differences arising in respect of fixed assets acquired from outside India were capitalised as part of fixed assets (see note 13 below). Derivative transactions are considered as off-balance sheet items and cash flows arising there from are recognised in the books of account as and when the settlements take place in accordance with the terms of the respective contracts over the tenor thereof. Accounts Receivable in foreign currency are either represented by bills of exchange, which in many cases, are immediately discounted with bankers, or accounted at realized amounts.
Borrowing Cost Borrowing costs that are attributable to the acquisition or construction of assets are capitalized as part of the cost of such assets, 23

* Taxation Provision for tax for the year comprises current income-tax and fringe benefit tax determined to be payable in respect of taxable income and deferred tax being the tax effect of timing differences representing the difference between taxable income and accounting income that originate in one period, and are capable of reversal in one or more subsequent period(s). * Earning per Share The earnings considered in ascertaining the company's Earnings per Share (EPS) comprise the net profit after tax. The number of shares used in computing Basic EPS is the Weighted average number of shares outstanding during the year. The diluted EPS is calculated on the same basis as basic EPS, after adjusting for the effects of potential dilutive equity shares. * Contingent Liability Contingent liabilities determined on the basis of available information; wherever material are provided for and Contingent liabilities not provided for in the accounts are disclosed by way of notes to the accounts.
2.
Transfer of Ceramic Division from Madhusudan Industries Limited (MIL) The Honourable High Court of Judicature at Gujarat vide its order dated 30.10.2001 has sanctioned Scheme of Arrangement (the Scheme) U/s. 391 -394 of the Companies Act, 1956 between Madhusudan Industries Limited ("MIL") and the Company under which all the assets, liabilities and debts of the Ceramic Division as defined in the Scheme ("the Undertaking") of "MIL" comprising of Ceramic Division have been transferred to the Company at net book value with effect from 01.04.2001. The Name of the Company has been changed from Madhusudan Oils And Fats Limited to Cera Sanitaryware Limited with effect from 01.11.2002 consequent upon the fresh certificate of Incorporation, issued by the Registrar of Companies, Gujarat State, Ahmedabad. Impairment of Assets Assets that are subject to amortisation are reviewed for impairment whenever events or changes in circumstances Indicate that the amount may not be recoverable. An impairment loss is recognized for the amount by which the assets' carrying amount exceeds its recoverable amount. The recoverable amount is the higher of the assets' net selling price and its value in use. Contingent liability in respect o f : a. b. c. Claims against the Company not acknowledged as debts. Estimated amount of contracts remaining to be executed on capital account not provided for (Net of advance) Letters of Credit opened and guarantees given by the Bank in favour of Parties and Government Authorities. 31.03,2009 Rs. 52,55,266 31.03.2008 Rs. 80,16,921 3,13,821 3,67,40,995
3.
4.
2,85,20,582
5.
Preferential Warrants for Equity Shares During the year ended on 31st March, 2009 the company has forfeited 3,40,000 Preferential Warrants issued to promoters on preferential basis; since the option of conversion of warrants was not exercised by the due date 26.07.2008. Rs.41.82 Lacs received as 10% of subscription value of preferential warrants is transferred to Share Premium Account. Employees Stock Option Scheme In respect of Option granted to employees under the Employees Stock Option Scheme, in accordance with the guidelines issued by Securities and Exchange Board of India, the accounting value of Options, based on Market Price of the shares on the date of grant of the Option, is accounted as deferred Employee Compensation, which is amortised on a straight line basis over the vesting period. Consequently an amount of Rs.40.58 (92.10) lacs has been amortised for the Current Year. Miscellaneous expenses include payment to Auditors as under: Statutory Auditors Audit Fees Taxation work Other Services Expenses 1,50,000 1,13,315 1,19,005 25,447 4,07,767 1,00,000 1,55,500 750 22,000 2,78,250 2007-08 Rs. 76,30,800 7,70,400 12,26,247 96,27,447 Current year Previous year Rs. Rs.
6,
7.
8.
(a)
Managerial Remuneration to CMD, Executive Director and Whole time Director under Section 198 of the Companies Act, 1956. To CMD, Executive Director and Whole time Director i. ii. ii. Salary Contribution to Provident and Other Funds Perquisites in cash or in kind
2008-09 Rs. 1,30,24,398 9,58,897 20,91,108 1,60,74,403
Notes : (1) (2) Above Remuneration includes payment as Directors' and not for the period as an employee. As the liability for Gratuity and Leave Encashment is provided for on an actuarial basis for the company as a whole, the amount pertaining to directors is not ascertainable and therefore not included. 24

(b) Computation of Profit in accordance with section 198(1) read with Sec 309(5) of the Companies Act, 1956 for calculation of Managerial Remuneration 2008-09 Rs, Profit before Taxation (as per books) Add: 1. Managerial Remuneration 2. Depreciation charged in the accounts 3. Directors' Commission 4, Directors' Sitting Fees 1,60,74,403 5,92,81,214 4,00,000 4,000 7,57,59,617 27,47,98,020 Less: Depreciation as per Section 350 of the Companies Act, 1956 Profit as per Section 198 of the Companies Act, 1956 10% of the Profit as per section 198 of the Companies Act, 1956 Remuneration paid during the year Directors' Commission Payable @ 1% Directors' Commission Restricted to 9. 5,92,81,214 21,55,16,806 2,15,51,681 1,60,74,403 21,55,168 4,00,000 Licensed Rs. 19,90,38,403 96,27,447 4,94,13,779 Rs. 2007-08 Rs. 15,53,82,018
26,000 5,90,67,226 21,44,49,244 4,94,13,779 16,50,35,465 1,65,03,547 96,27,447
installed (as certified by Management) 24,000 (24,000) 4.975 M.W. (4.975M.W.) 18,525 (18,402)
Particulars in respect of goods manufactured : (On triple shift basis in tons per annum) A. Capacity (in M.T.)
1. 2. B.
Vitreous China Sanitaryware Non Conventional Energy (WTG)
24,000 (24,000)
Actual Production (in M.T.) 1. 2. Vitreous China Sanitaryware Non Conventional Energy (WTG) (in units)
* 59,65,534 (44,66,638) * Under Energy banking system, electricity produced is for use by Ceramic Division at Kadi except 4,63,157 units given to UGVCL. (a) Sales and Stock of Goods Manufactured and Traded Opening Stock Closing Stock Sales Quantity Value Quantity Value Quantity Value Rs. Rs, Rs. Vitreous China Sanitaryware (in M.T.) 2,999 3,243 7,89,04,247 6,98,08,121 18,769 1,02,48,04,655 (1,760) (4,47,96,161) (3,243) (7,89,04,247) (16,919) (82,90,47,961) Outsourced : - Bathware & Taps (in Nos.) 3,42,096 11,20,27,398 3,80,586 11,34,28,941 11,86,718 65,38,00,086 (2,62,577) (9,93,76,492) (3,42,096) (11,20,27,398) (13,61,538) (55,89,47,176) - Tiles (in Boxes) 400 98,514 16,270 1,72,86,314 37,113 2,53,33,271 (1,893) (400) (98,514) (18,310) (23,54,558) (56,50,207) - Others 1,31,218 15,33,392 -
(-)
C. (b) Purchases
(-)
(-)
1,70,54,71,404 (1,39,36,45,345) Quantity Value Rs.
Goods Outsourced : - Bathware & Taps (in Nos.) - Tiles (in Boxes) - Others
12,25,208 43,19,49,819 (14,41,057) (38,04,18,185) 3,74,13,070 52,983 (16,817) (27,61,361) 2,39,035
(-)
46,96,01,924 (38,31,79,546) 25
Annual Report 2008-2009,

D. Itemwise Break-up of Raw Materials consumed 2008-09 QTY. M.T. Sand, Sandstone, Clays & Chemicals Accessories & Fittings (Pcs) E. Value of Imports on C.I.F. basis 1. 2. 3. 4. F. Raw Materials and Chemicals Stores and Spare Parts & Fittings Capital Goods Outsourced 34,858 2,44,558 Value Rs. 11,76,33,936 1,28,14,782 13,04,48,718 2008-09 Rs. 88,18,648 16,69,400 QTY. M.T. 37,771 2,20,109 2007-08 Value Rs. 12,66,69,496 42,27,343 13,08,96,839 2007-08 Rs. 59,78,919 60,42,181 86,76,086 11,76,00,108 13,82,97,294
12,23,87,763 13,28,75,811
Value of Raw Materials, Stores & Spare Parts consumed Raw Materials Rs. 1. 2, Imported Indigenous 72,03,982 (80,12,826) 12,32,44,736 (12,28,84,013) Stores & Spare Parts
%
5.52% (6.12%)
Rs. 56,80,929 (1,24,60,013)
%
18.15% (22.69%) 81.85% (77.31%)
94.48% 2,56,25,780 (93.88%) (4,24,51,693)

Rs.
G.
Expenditure in Foreign Currencies on Account of 1. 2. 3. 4. 5. Travelling Export. Commission Interest / Bank Charges Technical know-how & Professional fees Others 32,01,977 (16,31,705) 8,97,928 (8,93,958) 1,62,33,398 (56,34,746) 12,99,261 (15,70,242) 41,00,781 (20,87,151) 2008-09 Final Dividend Number of Shareholders Number of Equity Shares held Amount remitted (Rs.) Year to which the dividend pertain 2007-08 1 5,50,000 6,05,000 2006-07
Rs.
H.
Amount remitted in Foreign Currency towards dividend during the year
I.
Earnings in Foreign Exchange Exports of Goods on F.O.B. Basis 4,21,68,834 (2,79,11,762) 31.03.2009 Rs. 5,28,39,628 22,72,75,976 31.03.2008 Rs. 5,20,24,280 21,56,53,914
10.
(a)
Current liabilities - Sundry Creditors include amount payable to SSI Units : a. b.

c.
Amount due to SSI units Others

Amount payable to SSI units :-
ABREF PRIVATE LTD., BAM MO POLYMERS LTD., BHAWANI STEELS, CLASSIC BATHROOM PRODUCTS PVT. LTD., CROWN CHEMICALS (INDIA), DEVILSONI ENTERPRISES, DIP CRAFT INDUSTRIES, EMINENT COMPOSITES PVT LTD., ESSEL BATH FITTINGS PVT. LTD., ESSEX FAUCET C O , ETHICAL POLYPAPER PVT.LTD, EUREKA POLY PRODUCTS PVT LTD., FRIENDS ENTERPRISES, GARIMA ENTERPRISES, GULABCHAND KOCHAR, H.KUMAR & CO., HI LIFE MANUFACTURING CO., HIMACHAL POLY PRODUCTS JAISHAL PLASTICS MUMBAI, JAS ENTERPRISES, JAYPEE ENTERPRISES, KANCHAN CERAMICS, LAXMI
MINERALS, MAHAKAL INDUSTRIES, MATCHWELL PACKAGING INDUSTRIES, MEGHD00T ENTERPRISE (M), METALC0
INDIA [P] L T D , NATIONAL TRADERS, PANAMA SALES CORPORATION, PEARL INTERNATIONAL, PRIMA AUTOMATION (INDIA) PVT LTD, R. A. J. POLYMERS, R. C. INDUSTRIES, RAMNATH INDUSTRIES, RAMNATH MARKETING, SHIV SHAKTI CHINA CLAY, SHREE GAYATRI MINERALS, SHREE RAM CHINA CLAY, SHREE SHAKTI SALES COMPANY, SUPERFLO PVT LTD, VELPACK PAPER PRODUCTS, VIKAS ENTERPRISES, YOGI PLAST SERVICES
26

(b) Disclosures required for Small enterprises and Micro enterprises for year ended March 31, 2009 Particulars As on 31-03-2009 Principal Amt.(Rs.) 5,28,39,628 Unpaid Principal and Interest thereon as at March 31, 2009 Delayed payments due as at March 31, 2009 Nil Interest paid on delayed payment during the year Nil Interest due on principal amounts paid beyond the due date during the year Nil Interest accrued but not due Nil Total Interest due but not paid Nil Note: The above disclosure has been made based on the information provided by the management. 11, Basic & Diluted EPS Basic Earning per share Profit attributable to the shareholders Weighted average number of Equity shares outstanding during the year Nominal Value of Equity Shares Basic Earning per Share (F.V. Rs. 5 per share) Diluted Earning per share Profit attributable to the shareholders Weighted average number of Equity shares outstanding during the year Nominal Value of Equity Shares Diluted Earning per Share (F.V. Rs. 5 per share) Number of shares for Basic & Dilutive EPS Weighted average number of equity shares outstanding during the year for Basic EPS Add: Dilutive potential Equity Shares Weighted! average number of equity shares outstanding during the year for Dilutive EPS 12. A B A/B A B A/B
2008-09
Interest Amt.(Rs.) Nil Nil Nil Nil Nil Nil
As on 31-03-2008 Principal Interest Amt.(Rs.) Amt.(Rs.) 5,20,24,280
Nil
Nil Nil Nil Nil
Nil Nil Nil Nil Nil Nil
2007-08 10,04,90,592 61,41,735 Rs. 5 Rs. 16.36 10,04,90,592 62,56,273 Rs, 5 Rs. 16.06 61,41,735 1,14,538 62,56,273
13,10,85,582 61,99,249 Rs. 5 Rs. 21.15 13,10,85,582 61,99,249 Rs. 5 Rs. 21.15 61,99,249
_
61,99,249
The exceptional item represents the one time, non recurring loss suffered by the company consequent to having entered into certain foreign currency swap transactions which have been settled during the year.
13. Pursuant to notification dt. 31st March, 2009 issued by the Ministry of Corporate Affairs, the company has exercised the option available under the newly inserted Paragraph 46 to the AS-11. The effect of changes In foreign exchange rates is to add/deduct the foreign exchange fluctuation to capital cost of the asset. Accordingly the net foreign exchange fluctuation (FY 08 & FY 09) amounting to Rs.1.96 Cr. (net of trf. from General Reserve) has been added to the cost of capital assets had the company not adopted these changes, the current year's depreciation would have been lower by Rs.1.55 lacs and the profit would have been lower by Rs.158.15 lacs (Net of Tax), 14. Employee Benefits The company has with effect from 1st April 2007, adopted Accounting standard 15, Employee benefits (revised 2005), Issued by the Institute of Chartered Accountants of India. The disclosure as required are as under: 1) Brief description of the plans : The company has various schemes for long-term benefits such as provident fund, gratuity and leave encashment. In case of funded schemes, the funds are recognised by income tax authorities and administered through trustees/appropriate authorities. The company's defined contribution plans are Provident Fund (exempted employees) recognised by the Income Tax Authorities and administered through trustees. Since the company has no further obligation beyond making contributions and interest shortfall. Further the pattern of investment for investible funds is as prescribed by the Government. Accordingly other related disclosures in respect of Provident Fund have not been made. The company's other defined contribution plans are Provident Fund (non exempted employees), Employees' pension scheme (under the Provisions of the employees' Provident Funds and Miscellaneous Provisions Act, 1952), state plans namely Employee's State Insurance Fund, since company has no further obligation beyond making contributions. The company's defined benefit plans are Gratuity and leave Encashment for all its employees. Gratuity fund is recognised by the Income Tax Authorities and is administered through trustees. Liability for Defined Benefit Plan is provided on the basis of valuations, as at Balance sheet date, carried out by an independent actuary The actuarial valuation method used by independent actuary for measuring the liability is the projected unit credit method. Charge to the Profit and Loss Account based on contributions: Rs. in Lacs 2008-09 Provident fund Employees' Pension Scheme ESIC 54,81,596 47,75,381 33,57,834 1,36,14,811 27 2007-08 48,77,054 41,78,050 32,02,421 1,22,57,525
2)

3) Disclosures for defined benefit plans based on actuarial reports as on 31 st March, 2009 Rs. in Lacs 2008-09 Particulars Change in Defined Benefits Obligation Opening defined benefits obligation Current service cost interest cost Actuarial loss / (gain) Benefits paid Closing defined benefits obligation Change in Fair value of Assets Opening fair value of plan assets Expected return on plan assets Actuarial gain / (loss) Contributions by employer Benefits paid Closing fair value of plan assets Gratuity Leave Encashment Funded Plan Non-funded Plan 35304088 3311968 2647807 1440726 -4789677 37914912 35369719 3307296 -1473790 5712200 -4789677 38125748 11885972 4493335 -2278374 14100933 2689842 891448 912045 4493335 11885972 2689842 891448 912045 -2278374 14100933 2007-08 Gratuity Funded Plan 30595164 3001521 2447613 1521383 2261593 35304088 30148396 2948315 -1017604 5552205 -2261593 35369719 446768 5039806 -5552205 -65631 3001521 2447613 -2948315 2538987 5039806 35% 56% 9% 7.50% 6% 8% 9% 6% 8.05% 6% 10082250 2547069 -743347 11885972 1880671 811621 -145223 2547069 Leave Encashment Non-funded Plan 10082250 1880671 811621 -145223 743347 11885972
Movement in net liability recognized in Balance Sheet -65,631 Net opening liability P & L Charge 5566995 Contribution Paid -5712200 Closing Net (asset) / liability -210836 Expenses recognized in the Profit and Loss Account Current Service cost 3311968 Interest on defined benefit obligation 2647807 Expected return on plan assets -3307296 Net actuarial loss / (gain) recognized in the current year 2914516 Total Expenses Assets Information Government of India Securities Corporate Bonds Special Deposits Scheme Others Principal actuarial assumption Discount Rate (p.a) Expected rate of return on plan assets (p.a) Annual Increase in Salary costs Effect on the aggregate service cost & Interest cost Effect on defined benefit obligation (4) 15. 5566995 35% 56% 9% 7.50% 9% 6%
The Company has provided upto 31.03.2009 Rs.141.01 Lacs (118.86 Lacs) being increment of discounted value of liability for unavailed leave of the employees determined as per actuarial valuation.
Related party disclosures Associates Type of Transaction (Rs.) Purchases - Goods & Materials Fixed Assets Sales Expenses Fixed Assets Remuneration Lease Rent / Rent Other Services 28 62,33,773 Key Management Personnel (Rs.) Relatives of Key Management Personnel (Rs.) Total
(Rs.) 62,33,773
(-) (67,114)
(-) (67,114)
(1,44,500)
(1,44,500) 1,60,74,403 (96,27,447) 1,15,517 (1,19,754) 1,61,89,920 (97,47,201)
(-) (-)
10,000
10,000
(-)
(-)
(-)

Associates Type of Transaction (Rs.) Interest paid Donation / Other Expenses Income Finance Interest Received Loans & Advances given Fixed Deposits / Loan Received Fixed Deposits / Loan repaid Balance at the end of the year Loans & Advances Loans / Deposits 22,04,374 (19,73,754) 4,15,936 (5,24,290) 14,145 Key Management Personnel (Rs.) Relatives of Key Management Personnel (Rs.) Total
(Rs.) 22,04,374 (19,73,754) 8,60,936 (5,24,290) 14,145
4,45,000
(-)
(-) (2,85,678) 11,50,000 (2,78,50,000) 95,60,000 (2,60,50,000) -1,218 (94,544) 1,52,90,000 (2,37,00,000)
(-) (2,85,678) 11,50,000 (2,78,50,000) 95,60,000 (2,60,50,000) -1,218 (94,544) 1,52,90,000 (2,37,00,000)
Others Equity Shares allotted against Preferential Warrants (Nos) Preferential Warrants to subscribe for Equity Shares (Nos) Options granted and outstanding (Under ESOS)
(1,10,000)
(1,10,000)
(-)
15,000 (30,000)
(-)
15,000 (30,000)
Notes : Names of related parties and description of relationship : 1. Fellow Subsidiaries 2. Associates 1. Madhusudan Industries Limited 5. Madhusudan Holdings Ltd. 2. Madhusudan Fiscal Limited 6. Swadeshi Fan Ind. Ltd. 3. Cera Foundation 7. Decolite Ceramics Ltd. 4. Vikram Investment Co. Ltd. 3. 4. 16. Key Management Personnel Relatives of Key Management Personnel Vikram Somany, Vidush Somany, S. C. Kothari, Dr. K. N. Maiti & S. K. Nema Smiti Somany
Note on deferred tax liability The Deferred tax liabilities as at 31st March, 2009 comprise of the following Deferred Tax Liabilities on account of: Depreciation Deferred Expenses Less: Deferred Tax Assets on account of: - Others Total
2008-09 Amount (Rs.) 14,15,76,571 -45,32,293 13,70,44,278 3,90,499 13,66,53,779
2007-08 Amount (Rs.) 12,60,28,202 -31,68,573 12,28,59,629 1,84,409 12,26,75,220
(Figures in brackets relate to previous year)
As per our report of even date attached For and on behalf of H. V. Vasa & Co. Chartered Accountants Tushar H. Vasa Rajesh B. Shah - C F O . Proprietor Narendra N. Patel Membership No. 16831 G.M. & Company Secretary Ahmedabad 28th May, 2009 Ahmedabad 28th May, 2009
Vikram Somany Vidush Somany Ashok Chhajed Dr. K. N. S. K. Maiti Nema
Chairman-cum-Managing Director Executive Director Director Director Whole time Director
29

Cash Flow Statement for the year ended 31st March, 2009
Year ended March 31, 2009 Rs. Rs. A. Cash flow from operating activities Net profit before tax & Extra-ordinary items Adjusted for Depreciation Foreign Exchange Investment Income Interest Charged Operating profit before working capital changes Adjusted for Trade and other receivables Inventories Trade Payable Cash generated from operation Interest paid Direct taxes paid Cash flow before extra-ordinary items Extra-ordinary items Net Cash From Operating Activities B. Cash flow from Investing activities Purchase of fixed assets Sale of fixed assets Purchase of Investments Sale of investments (net of loss) Interest received Dividend received Net Cash Used In Investing Activities C. Cash flow from financing activities Proceeds from issue of share capital Right issue expenses Proceeds from borrowings Dividend paid Net Cash Used in Financing Activities Total (C) Total (B) Total (A) -5,01,04,032 -25,14,000 1,99,73,382 -3,26,44,650 25,74,24,203 -3,96,59,105 -4,26,50,516 17,51,14,582 4,86,506 17,56,01,088 -4,50,34,649 7,87,524 5,92,81,214 7,26,346 19,04,02,188 4,94,13,779 30,97,713 3,17,20,819 9,96,66,665 29,00,68,853 -2,69,22,694 -6,25,86,646 3,00,35,543 -5,94,73,797 16,85,21,321 -3,17,20,819 -2,92,55,387 10,75,45,115 -55,89,459 10,19,55,656 -22,07,08,193 11,29,068 8,42,32,311 22,79,95,118 14,37,62,807 Year ended March 31, 2008 Rs. Rs,
3,96,59,105
79,23,928
80,45,060 7,77,622 -21,07,56,443 2,13,87,249
-3,63,23,197 56,35,071 -2,49,85,184 -1,08,54,236 -3,02,04,349 10,90,73,542 10,72,90,272 21,63,63,814 Vikram Somany VIdush Somany Ashok Chhajed Dr. K. N. Maiti S. K. Nema Auditors' Certificate
9,55,95,319 -78,18,209 10,91,64,359 3,63,572 10,69,26,700 10,72,90,272 Chairman-cum-Managing Director Executive Director Director Director Whole time Director
Net Changes in Cash & Cash Equivalents (A+B+C) Cash & Cash equivalent - Opening Balance Cash & Cash equivalent - Closing Balance Rajesh B. Shah - C. F. O.
Narendra N. Patel - G. M. & Company Secretary Ahmedabad, 28th May, 2009
We have verified the above cash flow statement of Cera Sanitaryware Limited derived from, the audited annual financial statements for the years ended March 31, 2009 and March 31, 2008 and found the same to be drawn in accordance therewith and also with the requirements of Clause 32 of the listing agreements with stock exchange(s). As per our report of even date attached For and on Behalf of H. V. Vasa & Co. Chartered Accountants Tushar H. Vasa Proprietor Membership No. 16831 30
Ahmedabad 28th May, 2009
32
C A L L IT
STYLEWARE
NOT SANITARY WARE
U l t r a - m o d e r n d e s i g n i n g , c o n t e m p o r a r y s t y l i n g and 21st c e n t u r y t e c h n o l o g y c o m e t o g e t h e r t o b r i n g y o u t h e latest range f r o m C e r a .

SANITARYWARE | TILES | TAPS
Cera Sanitaryware Limited: Madhusudan House, Opp. Navrangpura Telephone Exchange, Ahmedabad 380 006 Phone: 079-26449781, 26449789 Fax; 079-26569259 E-mail: marketing@cera-india.com Website: www.cera-india.com Chennai: +91 9380052101/103 Delhi: 011-26884232, 26884234 Kolkata: 033-22317410, 30280988 Pune: 020-24455172 | Cera Bath Studio. (Company Display Centres): Ahmedabad: 079-26931140, 32205237 Bangalore: 080-32917343 Chandigarh: 0172-2795641, 3208093 Cochin: 0484-3232043, 3231446 Hyderabad: 040-32006845 Kolkata: 033-32996221 Mumbai: 022-32508669, 27801942 | Cera Bath Gallery (Exclusive Cera Retail Centres): Ahmedabad: 079-65422561 Calicut: 0495-3048100 Chennai: 100Ft. Road; 044-24759909, Anna Nagar: 044-26191305 Jammu & Kashmir: 0194-2103838 New Delhi: 011-28723040, 45052755 Exclusive outlet: for premium designer tiles, hand-picked from all over the world. | Delhi: 011 -46540285, 46540286
Fashion - art in world tiles
BOOK-POST
To,

Madhusudan House, Opp. Navrangpura Telephone Exchange, Ahmedabad 380 006 Tel.: 079-26449781, 26449789 Fax: 079-26569259 Email: marketing @cera-india,com Website: www.cera-india.com
A H M E D A B A D : 1st Floor, Shivalik Arcade, Anand Nagar Cross Roads, 100 Ft. Road, Ahmedabad 380 015 Tel.: 079-2693 1140, 32205237 E-mail: bathstudio_ahd@cera-india.com BANGALORE: 596/601-47, 1st Floor, Dr. Rajkumar Road, Prakash. Nagar, Opp. Andhra Bank, Bangalore 560 021 Tel.: 080-329(7343 Telefax: 080-23325622 Email: bangalore@cera-india.com C H A N D I G A R H : SCO 3A, 1st Floor, Sector 7-C, Chandigarh 160 019 Tel.: 0172-3208093 Telefax : 0172-2795641 Email: chandigarh@cera-india.com C O C H I N : 2nd Floor, Jacob's, 33-326B, Geetanjali junction, Chalikavattam Palarivattam-Vyttila NH By-Pass 47, Ernakulam, Cochin 682 019 Tel.: 0484-3232043, 323 1446 Telefax : 0484-2805440 Email: cochin@cera-india.com HYDERABAD: Plot No. 1103, 2nd Floor, Food World Building. Jubilee Hills, Road No, 36, Hyderabad 500 033 Tel,: 040-32006845 Telefax: 040-23546918 Email: hyderabad@cera-india.com K O L K A T A : Unit N o . E 406, City Centre, DC Block, Sector-1, Salt Lake City Bidhannagar, Kolkata 700 064 Tel.: 033-32996221 E-mail: calcutta@cera-india.com MUMBAI: "Mahavir Arcade', Shop N o . 1, Ground Floor, Plot N o . 286, Sector 28, Vashi, Navi Mumbai 400 703 Tel.: 022-32508669, 27801942 Fax: 022-27802003 Email: mumbai@cera-india.com
A H M E D A B A D : Opp. Khodiyar Temple, Gota Gam, Nr, S. G. Highway, Ahmedabad 382 481 Tel.: 079-65422561 C A L I C U T : Soubagya Shopping Complex, Arayadathupalam, Mavoor Road, Calicut 673 004 Tel.: 0495-3048100 C H E N N A I : . 2/5, Sri Sakthi Nagar, 191,100 Ft, Road, Arumbakkam, Chennai 600 106 Tel.: 044-24759909 W-124, 3rd Main Road, Annanagar, Chennai 600 040 Tel.: 044-26191305 JAMMU & KASHMIR: Tanki Pora, Srinagar 190009 Tell: 0194-2103838 N E W DELHI: 1st Floor, 67/5356, Reghar Pura, Karol Bagh, N e w Delhi 110 005 Tel.: 011-28723040, 45052755 Telefax: 011-28722178 T R I V A N D R U M : Koipurathu Building, Near S.B.T. Poojappura Branch, Poojappura-Karamana Road, Poojappura, Trivandrum 695012 Tel.: 0471 -2340921
Exclusive o u t l e t f o r p r e m i u m designer t i l e s , h a n d - p i c k e d f r o m all o v e r t h e w o r l d .

Fashion-art in world tiles
A - 3 1 , 1 st Floor, Firoz Gandhi Road, Lajpat Nagar-2, New Delhi 110 024 T e l : 011 -46540285, 46540286 Fax: 011 -46540226 E-mail: ceravogue@cera-india.com REGD. OFFICE & W O R K S 9, GIDC Industrial Estate, Kadi 382 715, Dist. Mehsana, North Gujarat Tel..: 02764-242329, 262619, 262638, 263874, 321949 Fax: 02764-242465 Email: kadi@cera-india.com

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AS A L W A Y S , WE BRING YOU GREAT CURVES.

SANITARYWARE I TILES | TAPS

Cera Sanitaryware Limited

Executive Director Wholetime Director

Bankers State Bank of India ICICI Bank Ltd.

Annual Report 2008-2009

By Order of the Board of Directors Narendra N. Patel G. M. & Company Secretary

companies act, 1956 is annexed hereto.

Cera Sanitaryware Limited

Explanatory Statement pursuant to Section 173(2) of the Companies Act, 1956.

Annual Report 2008-2009

By Order of the Board of Directors Narendra N. Patel G. M. & Company Secretary

Cera Sanitaryware Limited Directors' Report

Annual Report 2008-2009

Cera Sanitaryware Limited

8% 24 Months 32% 18% Rs. 140.80 & Rs. 190.05

Annual Report 2008-2009

Cera Sanitaryware Limited

(2) Shri Vikram Somany (59 years)

(3) Chairman-cumManaging Director

(5) B.Sc, FCMI (U.K.) (35 years)

Shri Vidush Somany (28 years)

Shri Santoshkumar Nema (50 years)

CEO - cum Whole-time director

Shri M.K.Bhandari (57 years)

(2) Shri Subhash Chandra Kothari (64 years)

(3) Sr. Whole-time director

(5) B.Com., LLB, FCA (40 years)

Annual Report 2008-2009.

YES YES NO N O YES YES NO NO YES

Cera Sanitaryware Limited

1,00,000 1,00,000 1,00,000 4,00,000

Annual Report 2008-2009

10,001 And above Total

Cera Sanitaryware Limited

Ahmedabad 28th May, 2009

Annual Report 2008-2009

Cera Sanitaryware Limited

19. 20. 21.

Annual Report 2008-2009.

Vikram Somany Vidush Somany Ashok Chhajed Dr. K. N. Maiti S. K. Nema

Chairman-cum-Managing Director Executive Director Director Director Whole time Director

Cera Sanitaryware Limited

Annual Report 2008-2009

31-3-2008 Rs. Rs. Rs,

10,00,00,000 10,00,00,000 3,09,25,070

36,82,38,276 -41,62,953 9,65,52,781 46,06,28,104

7,96,36,356 36,82,38,276 10,02,00,000

11,31,80,000 41,82,000 14,47,600 11,88,09,600

-11,50,158 1,76,93,456 -19,94,442

Cera Sanitaryware Limited

40,87,949 63,19,554 7,47,31,288

Name of Assets Sr. No.

3. Plant & Machinery 4. Electric Plant & Installation

18,375 67,91,088 65,21,707 4,76,79,706 31,19,34,312

1,14,500 17,10,713 18,85,083 32,61,688

3,34,34,048 13,02,93,255 13,53,841 949 76,282 1,59,19,577 53,66,626 18,64,44,578 13,88,62,235

1,22,68,152 3,76,18,250 5,67,295 66 14,123 57,23,619 30,89,709 5,92,81,214 4,94,13,779

10,83,500 24,46,42,292 74,31,44,216 18,31,436 18,64,44,578 75,55,47,307

Annual Report 2008-2009

Cera Sanitaryware Limited

2,81,898 29,54,229 40,13,415 45,811 32,49,906 5,51,475 1,90,20,662

53,04,663 58,01,699 2,37,08,470