Annual Report 2005-06 Vindhya Tele

Vindhya Telelinks Limited
VINDHYA TELELINKS LIMITED

ANNUAL REPORT 2005-06
DIRECTORS
SHRI R.S.LODHA
Chairman
SHRI J.VEERARAGHAVAN
SHRI S.K.MISRA
SHRI R.C.TAPURIAH
SHRI D.R. BANSAL
SHRI H.V.LODHA
SHRI PRACHETAMAJUMDAR
SHRI R.G. MUNDRA
Managing Director
AUDIT COMMITTEE
SHRI J.VEERARAGHAVAN
Chairman
SHRI S.K.MISRA
SHRI D.R.BANSAL
SHRI PRACHETAMAJUMDAR
AUDITORS
S.R.BATLIBOI&CO.
CHARTERED ACCOUNTANTS
SOLICITORS
INTERNATIONAL TRADE LAW CONSULTANTS
BANKERS
STATE BANKOF INDIA
UTI BANK LIMITED
REGISTERED OFFICE
UDYOGVIHAR,
P.O.CHORHATA,
REWA-486006(M.P.)
IS.ISO 9001:2000
VINDHYATELELINKS LIMITED
NOTICE
NOTICE is hereby'given that the Twenty Third Annual General Meeting of Vindhya Telelinks Limited will be held at the Registered Office of
the Company at Udyog Vihar, P.O.Chorhata, Rewa (M.R) on Wednesday, the 12th July, 2006 at 11 a.m. to transact the following business:ORDINARY BUSINESS:
1. To receive, consider and adopt the Audited Balance Sheet of the Company as at 31st March, 2006, Profit and Loss Account for the
year ended on that date, and the Reports of the Directors and the Auditors thereon.
2. To appoint a Director in place of Shri R.C.Tapuriah, who retires by rotation and being eligible, offers himself for re-appointment.
3. To appoint a Director in place of Shri H.V. Lodha, who retires by rotation and being eligible, offers himself for re-appointment.
4. To appoint Auditors to hold office from the conclusion of this Annual General Meeting until the conclusion of the next Annual General
Meeting on such remuneration and reimbursement of out-of-pocket expenses as the Board may decide, based on the recommendation
of the Audit Committee.
SPECIAL BUSINESS:
5.
To take note of the following special resolution which has been placed before the shareholders for approval through Postal Ballot:
"RESOLVED that pursuant to the provisions of Section 17 and other applicable provisions, if any, of the Companies Act, 1956, the
Memorandum of Association of the Company be and is hereby altered and extended by inserting <he following Sub-clause as new Subclauses (62) & (63) immediately after the existing Sub-clause (61) of Clause MIC of the Memorandum of Association of the Company:
(62) To carry on the business of manufacture, produce, process, buy, sell, import, export and otherwise deal in all kind of Power
Cables, Radio Frequency Cables, Hybrid Cables, Composite Cables; Quad Cables, Railway Signalling Cables, Instrumentation
Cables, Control Cables, Ribbon Cables, Flexible Cables and Cords, other speciality cables, Optic Fibre and all kinds of Preform of
Silica Rods, Silica Rod and Tubes, Quartz Rods and Tubes, Fibre Reinforced Plastic (FRP) Rods, Glass Roving, Cable Filling/
Flooding Compound, Aramid Yarn, Colouring Inks, Oils, Chemicals, heat shrinkable sleeves, all gases, UV resins, all other raw
materials and inputs required for manufacture of all kinds of Optic Fibre, Telecommunication Cables, Power Cables, Radio
Frequency Cables, Hybrid Cables, Composite Cables, Quad Cables, Railway signalling Cables, Instrumentation Cables, Control
Cables, Other Speciality Cables, Power Distribution Cables, Ribbon Cables and all other types of cables, and other inputs used in
telecommunication network including parts, connectors and accessories thereof.
(63) To carry on business of manufacture, produce, process, sell, buy, import, export and otherwise deal in and repair of all types of
Telecom Networking Equipments including Optical Networking Unit, Optical Line Terminating Equipments, Splitters, Routers,
Element Management System, Active components of Fibre Optic Network, Passive components of Fibre Optic Network,
Accessories, Connectors, adaptors and Testing Equipments for all kind of cables and conductors including Optic Fibre, Optical Fibre
Cables, Jelly Filled Telephone Cables and also testing equipments for Optical fibre System and optical fibre transmission,
distribution networks, Transmission Networks such as Line Terminal Equipment, Multiplexers, Opto-Electronic Instruments, Line
Repeaters, Jointing and Terminating Equipment, Laser Device, Light Emitting Devices, Testing and Measuring Equipments and
design, installation, erection, laying, commissioning, transport and undertake turnkey projects for manufacturing, installing, laying,
commissioning of Fibre Optic System, electrical transmission and distribution networks or provide consultancy for installing, laying
and commissioning thereof.
FURTHER RESOLVED that the Board of Directors be and is hereby authorised to do all such acts, deeds, matters and things as
may be considered necessary, proper or expedient for giving effect to the resolution and for matters connected therewith or
incidental thereto.
FURTHER RESOLVED that the Board of Directors be and is hereby authorised to sub-delegate all or any of its powers to Managing
Director, Directors) or any officer of the Company to give effect to the aforesaid resolutions, as may be permitted in law."
6. To consider and, if thought fit, to pass with or without modification, the following resolution as a Special Resolution:
"RESOLVED that pursuant to section 149(2A) and all other applicable provisions, if any, of the Companies Act, 1956, approval of the
Company be and is hereby accorded to the Board of Directors for commencing and undertaking all or any of the business specified in
Sub-clauses (62) & (63) of Clause IIIC of the Memorandum of Association of the Company as and when deemed fit by the Board of
Directors."
Registered Office:
Udyog Vihar,
P.O.Chorhata,
Rewa-486 006 (M.R)
April 29 2006
By order of the Board

GautamSharma
Finance Manager & Assistant Secretary
NOTES:
(a)
The relevant Explanatory Statements pursuant to Section 173(2) of the Companies Act, 1956, relating to the Special Business to be
___transacted at the meeting is annexed hereto._______________________________________________
(b)
A MEMBER ENTITLED TO ATTEND AND VOTE AT THE MEETING IS ENTITLED TO APPOINT A PROXY TO ATTEND AND VOTE
INSTEAD OF HIMSELF/HERSELF AND PROXY NEED NOT BE A MEMBER OF THE COMPANY. THE PROXY IN ORDER TO BE
(c)
A copy of Memorandum and Articles of Association of the Company together with all proposed amendments will be kept open for
inspection at the Registered Office of the Company between 11 A.M. and 1 P.M. on any working day excluding Sundays and Holidays
and will also be available for inspection at the Meeting
(d)
The Register of Beneficial Owners, Register of Members and Share Transfer Books of the Company shall remain closed from
Thursday, the 6th July, 2006 to Wednesday, the 12th July, 2006 (both days inclusive).
COMMENCEMENT OF THE MEETING.
(e)
The Members are requested to notify immediately the changes, if any. in their registered address alongwith PINCODE Number
to their Depository Participants in respect of equity shares held in electronic form (Demat Account); and
to the. Company or its Registrar and Share Transfer Agents, viz. M/s Intime Spectrum Registry Ltd. (Unit: VindhyaTelelinks Ltd.),
C-13, Pannalal Silk Mills Compound. L.B.S.Marg, Bhandup (West), Mumbai - 400 078 in respect of equity shares held in
physical form.
(f)
Dividends which remain unclaimed/unencashed for a period of 7 years from the date of transfer to the Unpaid Dividend Account, will
be transferred by the Company to Investor Education & Protection Fund (IEPF) pursuant to the provisions of Section(s) 205A and
205C of the Companies Act, 1956. Further, under the provisions of Section 205C of the Companies Act, 1956, no claims by the
shareholders shall lie against the IEPF or the Company for the Unclaimed Dividend transferred to IEPF. Members who have so far
not encashed their dividend warrants for the year(s) ended 31st March, 1999, 2000, 2001 and 2002, are therefore requested
immediately to write to the Company or Company's Registrar and Share Transfer Agents, viz. M/s Intime Spectrum Registry Limited
for issuance of demand draft in lieu of Unencashed/Unclaimed Dividend Warrant, if any.
(g)
Additional information pursuant to Clause 49 of the Listing Agreement(s) with Stock Exchanges, on Directors recommended for
re-appointment at the forthcoming Annual General Meeting, are given in.the Annexure to the Notice.
Members/Proxies are requested to deposit the Attendance Slip duly filled in and signed for attending the meeting.
As per Section 192Aof the Companies Act, 1956 read with The Companies (Passing of the Resolution by Postal Ballot) Rules, 2001,
the consent of the Shareholders in respect of Item No,5, is required to be obtained by means of a Postal ballot.
(h)
(i)
ANNEXURE TO NOTICE
EXPLANATORY STATEMENT PURSUANT TO SECTION 173(2) OF THE COMPANIES ACT, 1956_____________
The following explanatory statements set out material facts relating to the Special Business of the accompanying Notice dated 29th April, 2006.
ITEM NO.5
The Company proposes to embark upon additional lines of business like manufacturing of and dealing in various other cables and items used
as raw materials in the manufacture of different types of Cables and also to manufacture and deal in various equipments, accessories and
systems, etc. used under telecom networks with a view to undertake diverse activities relating to diversified products in a more enlarged and
explicit manner. The Directors are of the view that the additional activities covered by the proposed Objects Clause may conveniently and
advantageously be combined with the existing business of the Company and also enable the Company to carry on its business more
economically.
Accordingly, it is proposed to amend Clause MIC of the Memorandum of Association of the Company as set out in the proposed resolution.
Pursuant to Section 17 of the Companies Act. 1956 a Special Resolution is required to be passed by the shareholders for alteration in the
Objects Clause of the Memorandum of Association.
As required under Section 192Aof the Companies Act, 1956 read with Companies (Passing of the Resolution by Postal Ballot) Rules, 2001
a Special resolution under Section 17 of the Companies Act, 1956 for alteration in the object clause of the Memorandum of Association is
required to be passed through Postal Ballot Notice of Postal Ballot is being sent to the shareholders separately.
The result of the Postal Ballot shall be declared at the ensuing Annual General Meeting.
The Board of Directors proposes the Resolution for your consideration and recommends the passing of the Special Resolution.
None of the Directors of the Company is interested or concerned in the said resolution except to the extent of Shares held by them in the
company.
ITEM N0.6
Pursuant to Section 149(2A) of the Companies Act, 1956, commencement of any new Business mentioned under 'Other Objects' of
Memorandum of Association of the Company requires approval of the Shareholders vide special resolution passed on that behalf in the
General Meeting. New business as mentioned in Sub-clauses (62) & (63) of Clause MIC of Memorandum of Association maybe commenced
by the Company any time after approval of Shareholders is obtained vide proposed special resolution.
The Board of Directors proposes the Resolution for your consideration and recommends the passing of the Special Resolution.
None of the Directors of the Company is interested or concerned in the said resolution.
Registered Office:
Udyog Vihar,
P.O.Chorhata,
Rewa-486006(M.R)
April 23, 2006
By order of the Board

GautamSharma
ANNEXURE TO NOTICE
Details of Directors seeking re-appointment in ensuing Annual General Meeting scheduled to be held on
12th July, 2006
Name of Director
Shri R.C.Tapuriah
Shri H.V.Lodha
Date of Birth
15.06.1942
13.02.1967
Date of Appointment
19.08.1985
05.05.2004
Expertise in specific
functional areas
List of outside Directorships held*
Industrialist with wide experience in An eminent Chartered Accountant and a

Partner of M/s Lodha & Co., Chartered
Business and Industry.
Accountants.
He has served various
committees and working groups set up by
Federation of Indian Chambers of Commerce and
Industry (FICCI); Indian Chambers of Commerce,
Kolkata; Department of Company Affairs,
Government of India; Reserve Bank of India; apart
from being a member of the Accounting
Standards Board set up by the Institute of
Chartered Accountants of India and alternate
member of the National Advisory Committee on
Accounting Standards set up by Government of
India. He has handled professional advisory
assignments in various fields and has been
involved in various Trusts, Educational and
Cultural Institutions.
1. Alfred Herbert (India) Ltd.
2. Adorn Investments Ltd.
3.
4.
5.
6.
7.
1.
2.
3.
4.
Alfred Herbert (India) Ltd.

Birla Corporation Ltd.
Fenner (India) Ltd.
Hindustan Gum & Chemicals Ltd.
Birla Ericsson Optical Ltd.

Bhagwati Pressing Company Ltd.
Calcutta Investment Company Ltd. 5. OCL (India) Ltd.
6. Optic Fibre Goa Ltd.
Maxworth Industrial Services Ltd.
7. Punjab Produce Holdings Ltd.
New India Sugar Mills Ltd.
8. Sicpa India Ltd.
8. United Investment Company Ltd.
9. Universal Cables Ltd.
Chairman/Member of the Committee of the

Board of Directors of the Company
Chairman/Member of the Committee of the Member- Audit Committee & Share

Transfer Cum - Investor
Board of Directors of other Public
Grievance Committee of
Company
Chairman- Audit Committee of OCL (India) Ltd.

and Sicpa India Ltd.
- Share Transfer & Investor Grievance
Committee of Birla Corporation Ltd.
New India Sugar Mills Ltd.

Member
- Audit Committee of Fenner (India)

Ltd.
Shareholding (both own or held by/for

other persons on a beneficial basis), if
any, in the paid up equity share capital
of the Company.
NIL
NIL
Number of other Directorships held by the Directors, as mentioned above, do not include alternate directorships, and directorships held
in foreign companies, Section 25 Companies and Indian private limited companies besides trustee/membership of managing
Committees of various trusts and other bodies, and are based on the latest declarations received from the Directors. The details of
Committee Membership/Chairmanship is in accordance with revised Clause 49 of the Listing Agreements and reflects the Membership/
Chairmanship of the Audit Committee and Shareholders'/Investors' Grievance Committee alone of all other Public Limited Companies.
Directors' Report
TO THE SHAREHOLDERS
Your Directors have the pleasure of presenting their Annual Report, together with the Audited Accounts of the Company for the year ended
31st March, 2006.
~"~-
FINANCIAL MATTERS
Year Ended
31st March, 2006
31st March, 2005
(Rs.in lacs)
11569.69
Gross Income for the year rs
440.41
The year's working shows a Gross Profit after interest of

Out of which provision has been made for
Depreciation
Profit before Exceptional Item, Prior Period Items and Tax
479.36
377.65
127.15
62.76
After deducting
Exceptional Item (Voluntary Retirement Compensation)

Prior Period Items
Profit before Tax
7.08
32.09
32.09
48.93
56.01
6.75
After adjusting
Income Tax for current year
(2.35)
Income Tax-Credit for earlier years (Net)

Deferred Tax Credit
Fringe Benefit Tax
9.58
25.80
51.42
(14.60)
34.47
Net profit for the year is
35.38
42.13
Credit balance brought forward

There is a total surplus of
171.66
42.13
which has been carried to Balance Sheet
In view of past losses and to conserve cash resources for future requirements, your Directors do not recommend any dividend for the year
under review.
GENERAL & CORPORATE MATTERS
Your Company's performance during the year under review has improved substantially, particularly the operating performance has recorded
significant improvement during the year compared to the previous year.

The gross total income for the year registered an impressive growth at Rs.160.76 Crores compared to Rs.115.70 Crores in previous year led
by volume growth in both Jelly Filled Telephone Cables (JFTC) and Optical Fibre Cables (OFC). The Company achieved significant
improvement in its sale of JFTC to private operators for rollout of their wireline networks. The OFC volume improved due to increased demand
from both BSNL and private operators mainly for their broadband requirements.
The outlook for JFTC would depend much on the order flow from BSNL/MTNL and wireline rollout plans of the private operators.
However, due to poor demand scenario, and existence of huge idle capacities for JFTC, operating margins for JFTC are likely to remain under
pressure. The profit and operating margins for OFC are expected to be stable during the current year on likely improved scenario for the OFC
business.
Your Company is taking steps to add further products in its portfolio with an eye on future like Ribbon Fibre Cable and Fibre-To-The-Home
(FTTH) network equipments. The Company is jointly participating with world renowned Fujikura Ltd. for the Expression of Interest floated by
MTNL/BSNL for FTTH Access Network Technology. The Company is gearing up its facilities in order to achieve the desired results in terms
of product quality and productivity.
CORPORATE GOVERNANCE
Pursuant to Clause 49 of the Listing Agreements with the Stock Exchanges, Management Discussion and Analysis, Corporate Governance
Report and certificate by the Managing Director (CEO) confirming compliance by all the Board members and Senior Management Personnel
with Company's Code of Conduct and Auditors' Certificate regarding compliance of conditions of Corporate Governance are made a part of
the Annual Report.
RESPONSIBILITY STATEMENT
As required underaction 217 (2AA) of the Companies Act, 1956, your Directors to the best of their knowledge and belief and according to
the information and explanation obtained by them, state that;
in the preparation of the Annual Accounts for the year ended 31st March, 2006, the applicable accounting standards have been followed;
the Company has selected such accounting policies, applied them consistently, made judgements and estimates that are reasonable and
prudent so as to give a true and fair view of the state of affairs of the Company as at the end of the financial year 2005-06 and of the
profit for the year ended 31st March, 2006;
proper and sufficient care have been taken for the maintenance of adequate accounting records in accordance with the provisions of the
Companies Act,1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities; and
the attached Annual Statement of Accounts for the year ended 31st March, 2006 have been prepared on a 'going concern' basis.
JOINT VENTURE
Despite depressed market conditions, Birla Ericsson Optical Ltd., a venture promoted by your Company in association with Universal Cables
Ltd. and Ericsson Cables AB, Sweden has shown remarkably improved performance during the year under review. Optic Fibre Goa Ltd.,
another venture (also a subsidiary) promoted by your Company in association with Universal Cables Ltd. and Birla Ericsson Optical Ltd. has
also shown comparatively improved performance during the year under review with its continued efforts on developing newer optical fibres.
INDUSTRIAL RELATIONS & SAFETY
Industrial relations generally remained cordial barring certain instances of indiscipline, disruptive action, concerted go-slow tactics and illegal
strike by a section of workers which are being dealt with as per governing legal provisions.
Your Company has been bestowed with the National Safety Award for outstanding performance in industrial safety during the year 2004
based on "Lowest Average Frequency Rate" and also "Longest Accident Free Year". The award received during the year under review is a
validation of your Company's efforts to continually improve upon the standards of occupational health and safety at its operations.
DIRECTORS
Shri R.C.Tapuriah and Shri H.V. Lodha retire from the Board by rotation at the ensuing Annual General Meeting and, being eligible, offers
themselves for re-appointment.
AUDITORS
Messrs S.R.Batliboi & Co., Chartered Accountants, retire as Auditors at the ensuing Annual General Meeting and, being eligible, offer
themselves for re-appointment.
Messrs S.Gupta & Co., Cost Accountants, have been re-appointed as Cost Auditors for Cost Audit in respect of Cables.
CONSOLIDATED FINANCIAL STATEMENTS
. In accordance with Accounting Standard (AS) 21 "Consolidated Financial Statements" read with Accounting Standard (AS) 27 "Financial
Reporting of Interests in Joint Venture", Group Accounts form part of this Annual Report.
SUBSIDIARY COMPANIES
In terms of approval granted by the Central Government under Section 212(8) of the Companies Act, 1956, the documents relating to
Subsidiary Companies as provided in Section 212(1) of the Companies Act, 1956 have not been attached with the Balance Sheet of the
Company. The Company wilt make these documents available upon request by any member of the Company interested in obtaining the
same. These documents will also be kept at the Registered Office of the Company and of the respective Subsidiary Companies for
inspection by any member of the Company.
Optic Fibre Goa Ltd., subsidiary of the Company, has decided to merge with one of its promoter companies with effect from 1st April, 2005
and has initiated the process of getting requisite approvals.
PARTICULARS OF EMPLOYEES
Particulars of employees in accordance with the provisions of Section 217(2A) of the Companies Act, 1956, read with the Companies
(Particulars of Employees) Rules, 1975, as amended, are not given, as none of the employees qualify for such disclosure.
ENERGY CONSERVATION, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
As required under Section 217(1)(e) of the Companies Act, 1956 and the Rules made therein, the concerned particulars relating to Energy
Conservation, Technology Absorption, Foreign Exchange Earnings and Outgo are given in Annexure, which is attached hereto and forms
a part of the Directors' Report.
ACKNOWLEDGEMENT
The Board of Directors would like to thank all employees of the Company and also Company's shareholders, customers, suppliers and
bankers for their continued support.

Yours faithfully,
R.S.Lodha
Chairman
J.Veeraraghavan
S.K.Misra
R.C.Tapuriah
D.R.Bansal
Directors
H.V.Lodha
Pracheta Majumdar
New Delhi, April 29, 2006.
R.G.Mundra
Managing Director
ANNEXURE
PARTICULARS OF CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO
AS PER SECTION 217(1)(e) OF THE COMPANIES ACT, 1956 AND THE RULES MADE THEREIN AND FORMING PART OF THE
DIRECTORS' REPORT FOR THE YEAR ENDED 31ST MARCH, 2006.
(A)
CONSERVATION OF ENERGY
The Company adopted following measures on energy conservation:
(B)
Optimization of DG Sets by implementing higher specific energy generation ratio (SEGR).
Energy saving by achieving unity Power Factor.
Putting off one Transformer by load optimization.
Optimization of plant lighting and outdoor lighting.
Engineering changes to minimize power consumption on machines.
TECHNOLOGY ABSORPTION
I.
Research and Development (R&D)
1. Specific areas in which R&D carried out by the Company
(a) Process re-engineering and optimization of process

equipment.
(b) Developments of new products for emerging market
requirements including.Micro Cables and speciality
cables.
2. Benefits derived as a result of the above R&D
(a) Technology upgradation, enhanced flexibility, cost

optimization and competitive edge.
3. Future plan of action
Continue efforts for development of new products, in

addition to other engineering processes and upgrades.
4.
R&D expenditure have not been accounted for

separately.
(b) Opportunity to compete in International Market.
Expenditure on R&D
II. Technology absorption, adaptation and innovation

1. Efforts, in brief, made towards technology absorption,
adaptation and innovation.
The technology
used to manufacture various
products of the Company in process control, product

development, cost reduction and quality improvements
are being made on continuous basis.
New product development,
productivity improvement.
2, Benefits derived as a result of the above efforts,

e.g.product improvement, cost reduction, product
development, import substitution, etc.
(C)
cost
reduction
and
FOREIGN EXCHANGE EARNINGS AND OUTGO
Details of foreign exchange earnings and outgo are contained in Schedule 22 [13.2] and [13.3 and 13.4] respectively annexed to and
forming part of the Accounts.
R.S.Lodha
Chairman
J.Veeraraghavan
S.K.Misra
R.C.Tapuriah
D.R.Bansal
Directors
H.V.Lodha
Pracheta Majumdar
New Delhi, April 29,2006.
R.G.Mundra
Managing Director
V1NDHYATELELINKS LIMITED
Management Discussion
and Analysis
INDUSTRY STRUCTURE AND DEVELOPMENTS
The Company is in the business of manufacture and sale of telecom cables comprising of Jelly Filled Telephone Cables (JFTC), Optical Fibre
Cables (OFC) including Fibre Ribbon.
JFTC made its foray as a substitute for the dry core paper cables. The capacities were built up since the mid-nineties leading to installed
capacity of approx. 1650 Lac Conductor Kilometers (LCKM) with around 1000-1100 LCKM being operational today. However, as a result of
the increasing preference for deployment of wireless networks and popularity of mobile services, the JFTC industry has shrunk at 120 LCKM
per annum level resulting in abysmally low capacity utilisation by nearly 40 companies that manufacture JFTC.
OFC has increasingly enabled the deployment of large backbone networks across the country in view of its higher capacity to transmit voice
and data. The preference of deploying OFC in intercity and subscriber access networks has also enabled the OFC sector to grow in India.
There are nearly 20 OFC manufacturers having an installed capacity of around 7 million fibre kilometers (FKMs) with current size of the
domestic market being estimated at approx. 2.25 million FKM p.a.
PRODUCT-WISE PERFORMANCE, OPPORTUNITIES, THREATS & BUSINESS OUTLOOK
Jelly Filled Telephone Cables

The Company achieved a sales volume of 19.70 LCKM of JFTC compared to 15.19 LCKM in the previous year reflecting an increase of
almost 30%. The turnover value reached Rs.12137.98 lacs compared to Rs.8660.87 lacs in the previous year amid continuously spiralling
copper prices. The improvement in turnover was primarily due to the supply of JFTC to BSNL against the annual tender floated in previous
year and increased demand from private operators.
The demand for JFTC is expected to be driven mainly by new wireline connections, regular replacement of old copper cables and replacement
of old wirelines to make them broadband enabled, and some quantum of exports. The overall outlook for JFTC appears uncertain for the
current year depending upon the order flow from BSNL/MTNL and the wireline rollout plans of the private operators. Even after the reported
restructuring of JFTC plants by certain JFTC manufacturers, the idle capacities are huge. The export market also does not have significant
upside potential. Given the poor demand scenario and the existence of large idle capacities, the Company is making all out efforts for
increasing operational efficiency, cost control and development of newer market.
Optical Fibre Cables
The OFC turnover of 5769 KM valued at Rs.2537.26 lacs during the year represented a significant increase over the previous year turnover
of 4809 KM valued at Rs.1153.64 lacs. The total turnover in terms of fibre kilometer during the year reached at 221258 fkm (including the
Fibre Ribbon) compared to 71640 fkm during the previous year.
The demand for OFC in current year is expected to grow mainly driven by the rollout of broadband networks, interconnection of mobile
networks using OFC, and laying of national long distance networks. In the backdrop of significant over capacity, the OFC prices are expected
to be stable.
The increased off take of OFC is also fuelled by the growing demand from private operators for their national long distance services. With
the increase in telecom traffic, the mobile networks would require increased OFC to inter connect. There is an increasing adoption of fibrebased networks by the cable TV operators to offer Ethernet Local area network and also by the large government owned utilities and the
infrastructure providers. The rollout of Fibre-To-The-Home (FTTH) Networks expected to begin in current year could provide another fillip to
the OFC demand.
Subsequent to the abolition of customs duty on OFC last year, the domestic OFC prices have become competitive with the imports.
However, due to insignificant market share of India in the world OFC trade and the improvement in global demand of OFC, the threat from
imports does not appear significant.
The Company had to discontinue the sale of Ericsson make Fusion Splicer Equipments during the year owing to discontinuation of the
particular model by Ericsson, which had contributed significantly to the profitability in previous year. The Company has successfully added
Fibre Ribbon in its product portfolio strengthening its competitive edge by achieving a turnover of 2293 KM valued at Rs.138.87 lacs in the
first full year of operations. The Company is taking steps to add further products in its portfolio both with a view to integrate its operations
and also to better its capacity utilization including tie-up with Fujikura Ltd. to collaborate in the Expression of Interest for FTTH Access Network
Technology floated by MTNL/BSNL.
Overall Review
The year 2005-06 has been a come back year of sorts for the telephone cable industry after a gap of 4 years. Plagued by huge capacities,
the industry witnessed revival of demand. The decline in domestic as well as international bandwidth prices is driving subscriber growth, which
is expected to encourage enhanced capital outlay for access network expansion. The growing triple play demand from Broadband subscribers
for telephony, internet access and broadcast television has endured the scope of fixed line telephony. However the Broadband connections
at a level of 13.10 lacs as at 31st March, 2006 are way below the target set by the Government leaving a huge demand gap to fill. The
teledensity has steadfastly reached at 12.73 at the end of March, 2006, but which has still higher potential in view of the huge untapped rural
market in the country. Coupled with one of the lowest tariffs in the Country, ONE INDIA Plan becoming a reality still holds out scope for the
industry. However, price levels are expected to be range bound in view of the large idle capacities in the telephone cable industry.
FINANCIAL REVIEW
The Gross turnover increased by almost 47% to Rs.15381.66 lacs in 2005-06 compared to Rs.10449.61 lacs in the previous year mainly
due to increase in turnover of JFTC to private operators coupled with copper led higher prices and of OFC to BSNL as well as private
operators.
The aggregate other income decreased to Rs.694.01 lacs during the year 2005-06 as against Rs.1120.08 lacs in the previous year mainly
because of lower one time credit of Rs.99 89 lacs in 2005-06 compared to the credit of Rs.332.77 lacs during the previous year resulting
from prepayment of certain deferred sales tax loans/liabilities and also due to lower interest income compared to the previous year
consequent to deployment of funds for the working capital requirements.
The Company achieved a gross profit before depreciation at Rs.606.51 lacs during the year as against the gross profit of Rs.440.41 lacs
in the previous year even after significant reduction in other income during the year as enumerated above. The sale of Fusion Splicer
Equipments was discontinued due to discontinuation of particular model by Ericsson during the year which had contributed significantly
to the profitability in the previous year. This signifies better operating performance due to increased business volumes and better price
realisations during the current year
The financial expenses increased due to availment of foreign currency loan (Buyer's credit and FCNRB loan) in the current year and
higher bank charges on account of increased imports of raw materials during the year.
The additions to the fixed assets of Rs.202.70 lacs (including Rs.56.81 lacs capital work in progress) during the year mainly consist of
capital expenditure incurred for modernisation and upgradation, installation of balancing equipments and new testing facilities and certain
additions to the furniture and office equipments/vehicles.
The inventory value increased to Rs.2309.64 lacs as on 31st March, 2006 from Rs.1745.30 lacs as at the end of the previous year due
to increase in raw material inventory and higher work in progress. On the expectations of duty cut on raw materials in the Finance
Budget, 2005, the Company had maintained lower levels of inventory as at 31st March, 2005.
The Debtors level at Rs.3057.26 lacs as at 31st March, 2006 as compared to Rs.1570.61 lacs as at 31st March, 2005 has increased
substantially in view of comparatively higher sales during last quarter of the financial year.
RISKS AND CONCERNS
The Company is exposed to a variety of risks. Some risks are general to our industry while others are specific. Over time, the Company
has countered the risks with relevant, appropriate and commensurate management. Some of the major risks to which the Company is
exposed and the Company's policy to reduce the adverse impacts of the same are:
Technological Risk:
Across the world, Foam skin insulated cable are steadily replacing Solid Polyethylene (PE) insulated cables. While being cost effective, the
foam skin cable retains all its technical characteristics and, as such has become acceptable in many countries all over the world. Although
the major buyers of JFTC in India currently purchase solid PE insulated cable but with its inherent technical and economic advantages, foam
skin cable may be a product of the future. The Company has sufficient capacity of foam skin cable and has also executed orders for such
cable.
Foreign Exchange Exposure Risk:
The Company is exposed to transactions in foreign currency due to imports. As a matter of prudent foreign exchange management, all foreign
currency exposures are closely monitored for risk in exchange rate fluctuations and forward covers are taken, where deemed appropriate.
Regulatory Risk:
Telecommunication is a regulated industry and regulatory changes affect both our customers and us. However, the Government's ambitious
targets for telecommunication expansion should see favourable regulatory environment in India. The Company has reduced costs and
improved efficiency and has thus established better flexibility to cost effectively accommodate fluctuations in demand.
Litigation Risk:
We are party to various Law Suits in the normal course of our business. We, however, do not expect any significant liability arising against
the Company as legally advised. The Company has been addressing the litigations on the legal advise of experts.
Customer Concentration Risk:
The customer base in telecommunication cable industry is relatively concentrated. The Company's major customer over the years has been
BSNL. The Company has, however, been able to retain and expand customers in Private Sector.
Competition Risk:
As a result of low capacity utilisation in the industry, the company faces stiff competition from other players in the industry. The Company,
has over the years established its name in the market because of its quality product and customer support.
Raw Material Price Fluctuation Risk:
The prices of certain raw materials based on metals and polyethylene fluctuate according to the international trends in supply and demand.
In order to minimise the impact of risks on account of such price volatility, an effective research based purchase policy has been put in place.
INTERNAL CONTROL SYSTEMS
The Company has an adequate system of internal control in place which assures of:
Authorization, recording and reporting of transactions.
Recording and safeguarding of assets.
Maintenance of accounting records and reliability of financial information.
Key elements are :
Clear and well defined organisation structure and limits of financial authority.
Corporate policies for financial reporting, accounting, information security, investment appraisal and corporate governance.
Annual budgets and business plan, identifying key risks and opportunities.
External firm of Chartered Accountants to carry out internal audit of all functions including physical verification of inventories.
Audit Committee of the Board which monitors and reviews all risk and control issues and financial matters.
Computerised and integrated financial and accounting functions, information feedback system of process parameters and back
tracing from finished products to raw material stage.
Routine evaluation of all financial, operating and information technology systems.
Laying down risk minimization procedures and regular review of the same.
INDUSTRIAL RELATIONS, HUMAN RESOURCE DEVELOPMENT AND SOCIAL RESPONSIBILITIES
Company sees its relationship with its employees as critical to the future and its employee relations agenda focuses on ensuring that
employees feel valued, on managing change constructively, and on creating an environment and culture within which every employee can
maximize his contribution.

Company is committed in providing the necessary development and training opportunities to equip our people with skills they will need in the
future. Our approach integrates development and training with business objectives, job performance and personal development needs.
Since inception, relationship with all the employees have been generally cordial barring certain instances of indiscipline, disruptive action and
concerted go-slow tactics adopted, by the workers which are being dealt with as per governing legal provisions. The Company employed 300
number of permanent employees as on 31st March, 2006.

The Industrial Training Institute established by the Company with the help of M.P.Birla Foundation Educational Society for providing
vocational training to students from surrounding villages continues to get encouraging response and students passing out from this Institute
are either self employed or have been successfully employed in various industries nation wide.
CAUTIONARY STATEMENT
The Management Discussion and Analysis Report may contain certain statements that might be considered "forward looking statements".
These statements are subject to certain risks and uncertainties. Actual results may differ materially from those expressed or implied in the
Statement as important factors could influence the Company's operations such as demand supply conditions, Government policies, local,
political and economic development, industrial relations, risks inherent to the Company's growth and such other factors. The Company does
not undertake any obligation to publicly update, inform or revise such statements, whether as a result of developments, events or actual
materialization. Market data and product analysis contained in this report has been taken from internal company reports, industry & research
publications, but their accuracy and completeness are not guaranteed and their reliability can not be assured.
10
Corporate
Governance Report
The detailed report on Corporate Governance in accordance with Clause 49 of the Listing Agreements with the Stock Exchanges is
set out below:
1.
CORPORATE GOVERNANCE PHILOSOPHY
Good Corporate Governance is an integral part of the Company's Management and Business Philosophy.
The importance of Corporate Governance lies in its contribution both to business prosperity and to accountability. Corporate
Governance envisages commitment of the Company towards the attainment of high levels of transparency, accountability and
business prosperity with the ultimate objective of realising long term shareholder value, whilst taking into account the interest of all other
stakeholders for wealth creation.
The Company will continue its efforts towards raising its standard in Corporate Governance and will also review its systems and
procedures constantly in order to keep pace with the changing economic environment.
2.
BOARD OF DIRECTORS
The present strength of the Board of Directors is Eight (8). The Company has a Non-Executive Chairman. The number of Independent
Directors on the Board is Four (4), which is more than 1 /3rd of the total number of Directors and the number of Non-Executive Directors
is Seven (7). which is more than 50% of the total number of Directors, as laid down under Clause 49.
None of the Directors is a member of more than 10 committees or acts as chairman of more than 5 committees (as specified in Clause
49), across all the companies in which he is a Director. The necessary disclosures regarding Committee memberships/chairmanships
have been made by the Directors.
During the financial year ended 31st March, 2006, four Board Meetings were held on 26th May, 2005, 25th July, 2005, 26th October,
2005 and 24th January, 2006. The maximum time gap between any two meetings was not more than four months.
The composition and category of the Directors on the Board, their attendance at the Board Meetings during the year and at the last
Annual General Meeting, as also the number of Directorships and Committee Memberships/Chairmanships held by them in other
companies are given below :
;N,aj^&;bf:|he::pjr^;tcif::|| iSseStîory,;::??::;;: :::::;g4::::::AttendanceSs::::;: :. ::*::::V:::::.>Nov.:of;:otfiKf;pjSii(iifiMpa ''îîriîb^sS'iSsSi;

:
:
;
S;:::;:;:?Sftairttc:t)iars. -'-S;;::;;S.-: . : : ;; ;:?^ : ;::^:^::;:::ivlei^lîîj[i>i^
;
: :; :
:
:
;
:
;
;Ss: :::iBparci:s:; ': .;.iiast.?s: : ' ;: ffii':*(*e*!S s;'i; i:::':?::' <p6B)ftHtfe!8:K:;:: ;S:s iiîi^îiiiiittîSS:::
ijMeîpgs; :$$& J;JA i&rfeejofsihifj?!:;: I^JWeiWi^rîf^-^ lll^ti||iiliii!|i|*?
Shri R.S.Lodha
(Chairman)
Non Independent
Non-Executive
No
13
None
Shri J.Veeraraghavan
Independent
Non-Executive
No
None
None
None
ShriS.K.Misra
Independent
Non-Executive
No
None
None
Shri R.C.Tapuriah
Independent
Non-Executive
No
None
Shri D.R.Bansal
Non Independent
Non-Executive
Yes
ShriH.V.Lodha
Non Independent
Non-Executive
No
Shri Pracheta Majumdar
Independent
Non-Executive
No
None
ShriR.G.Mundra
(Managing Director)
Non Independent
Executive
Yes
Notes:
(i) Number of other Directorships held by the Directors, as mentioned above, do not include alternate directorships, and directorships
held in foreign companies, Section 25 Companies and Indian private limited companies besides trustee/membership of managing
Committees of various trusts and other bodies and are based on the latest declarations received from the Directors. The details of
Committee Membership/Chairmanship is in accordance with revised Clause 49 of the Listing Agreements and reflects the Member
ship/Chairmanship of the Audit Committee and Shareholders'/Investors Grievance Committee alone of all other Public Limited
Companies.
(ii)None of the Non-Executive Directors hold any Equity Shares of the Company as per the declarations received from them.
The Company has a system to circulate and provide adequate information to the Board including as required under Annexure-IA of
Clause 49 of the Listing Agreement(s) to enable the Board to take informed decisions. The compliance report of all laws applicable
to the Company as prepared and compiled by the Compliance Officer is circulated to all the Directors alongwith the Agenda and
placed/reviewed in each Board Meeting.
11
The Board has laid down a Code of Conduct for all Board Members and Senior Management Personnel of tho Company and the same
has been posted on the website of the Company. '
A brief resume, expertise in specific functional areas, list of outside directorship held, membership/eh..'rr>anship ut the Committees of
the Board of Directors of the Company and other public companies and shareholding of directors retiiing u> lotation and eligible for
re-appointment at the ensuing Annual General Meeting (AGM) of the Company are given in the Notice of AGM. annexed to this Annual
Report.
i.
AUDIT COMMITTEE
The present Audit Committee consists of three Independent Non-Executive Directors and one Non-Executive Director the detailed
composition of the members of the Audit Committee is given below:
(a)
(b)
(c)
(d)
ShriS.K.Misra
Shri D.R.Bansal
:
:
:
:
Chairman
Member
Member
Member
(Independent Non-Executive Director)

(Non Independent Non-Executive Director^
All the members of the Audit Committee are financially literate and have vast experience in their respective fields
and Shri Pracheta Majumdar have accounting or related financial management expertise.
Shri D R.Bansal
The Secretary of the Company as appointed within the meaning of Section 383A of the Companies Act, 1956 is the Secretary of the
Audit Committee.
The Terms of Reference stipulated by the Board to the Audit Committee are as contained in Clause 49 of the I. isting Agreement as well
as Section 292A of the Companies Act, 1956 and broadly are as follows:
(i) Oversight of the Company's financial reporting process and the disclosure of its financial information to ensure that the financial
statement is correct, sufficient and credible,
(ii)
Recommending to the Board, the appointment, re-appointment and, if required, the replacement or removal of the statutory auditor
and the fixation of audit fees and also approval of payment for any other services rendered by the statutory auditors.
(iii) Reviewing, with the management, the annual and quarterly financial statements before submission to the Board tor approval
(iv) Reviewing, with the management, performance of statutory and internal auditors, adequacy of (tie internal control systems
(v) Reviewing the adequacy of internal audit function and discussion with internal auditors any significant findings and follow
up thereon,
(vi) Reviewing the findings of any internal investigations by the internal auditors into matters where there is suspected fraud or
irregularity or a failure of internal control systems of a material nature arid reporting the matter to the board.
(vii) Discussion with statutory auditors before the audit commences, about the nature and scope of audit as well as post audit
discussion to ascertain any area of concern.
(viii)To look into the reasons for substantial defaults in the payment to the depositors, debenture holders, shareholders (in case of nori
payment of declared dividends) and creditors

(ix) To
review mandatorily the following informations Management discussion and analysis of financial condition and results of operations:
Statement of significant related party transactions (as defined by the audit committee) submitted by management
Management letters/letters of internal control weaknesses issued by the statutory auditors,
Internal audit reports relating to internal control weaknesses; and
The appointment, removal and terms of remuneration of the Chief internal auditor shall be subject to review by tho Audit
Committee.
The financial statements, in particular, the investments made by the unlisted Subsidiary Companies
Details of meetings held during the year and attendance thereof are given below:
Name of Member t)f the :;

Audit Cpfiimittee
-i;
Meetings held and attendance particulars
: ; îiiZSt^MayydS:: ; ; :
ZSlb July, 05
Yes
Yes
Yes
No
ShriS.K.Misra
Yes
Yes
Yes
Yes
Shri D.R.Bansal
Yes
Yes
Yes
Yos
No
Yes
No
Yes
6th October, 0$
24th January, 06
The necessary quorum was present at all the above meetings.

The Audit Committee regularly invites such Executives as it considers appropiiate including the Head ol Finance function and the
representatives of Statutory, Internal and Cost Auditors to be present at the meeting of the Committee
4.
REMUNERATION COMMITTEE
The Remuneration Committee constituted in pursuance of the provisions of the Listing Agieement and Schedule XIII to the
Companies Act, 1956. consisting of all three Independent Non-Executive Directors viz. (i) Shri Pracheta M.ijumdar: (ii) Shii J Veoraraqlnvan.
and (iii) Shri S.K.Misra.
12
The terms of reference of the Remuneration Committee are as per the guidelines of the Central Government/Listing Agreement with
Stock Exchanges. The Committee did not meet during the financial year ended 31st March, 2006. The remuneration package of Shri
R.Q.Mundra on his re-appointment as Managing Director for a period from 4th November, 2005 to 3rd November, 2006 has been
approved by a resolution passed by circulation by the members of the Remuneration Committee on 29th October, 2005.
The Company does not have any policy for payment of remuneration to non-executive directors including non-executive independent
directors except by way of sitting fees at the rate of Rs.50007- for each meeting of the Board and/or Rs.2000/- for each meeting of
the Committee thereof attended by any such director as fixed by the Board of Directors in terms of the authority granted by the
Articles of Association of the Company. The details of remuneration paid to Directors/Managing Director for the financial year ended
31st March, 2006, are set out below:
(a)
Non-Executive Directors:
g|;|||fanri^ g|)|e::|i;riisii3r:;:; :
|
:
|
|
|
|:::;:::;;;;;;;;;:;;^
;;^::::?;|;;^
Shri R.S.Lodha
ShriS K.Misra
0.20
025
0.23
0.15
Shri R.C.Tapuriah
Shri D.R.Bansal
032
0.20
ShriH.V.Lodha
(b)
0 19
Managing Director:
ShriR.G.Mundra
(Rs.in lacs)
1.57
9.67
0.20
11.44
Notes:
(1)
Sitting fees includes fees paid for attending Committee Meetings.
(2)
The above remuneration excludes contribution/provision for gratuity and provisions for pension/leave encashment.
(3)
The terms of remuneration of the Managing Director and other conditions on his re-appointment with effect from 4th November,
2005 have been approved by the Remuneration Committee and confirmed by the shareholders in the Extra Ordinary General
Meeting held on 16th December, 2005.
(4)
As per the terms of the Agreement, for the purpose of Gratuity, Pension and other benefits, the services of the Managing Director
will be considered continuous with the Company from the date he joined the services of Universal Cables Limited or this
Company in any capacity from time to time and termination of agreement followed by immediate renewal(s) of agreement, will
not be considered as any break in the service. However, in case any benefit including pension and gratuity is already paid by
Universal Cables Limited or the Company, the same shall be deducted from the final amount payable.
(5)
All appointments are non-contractual except that of the Managing Director which is for one year with effect from 4th November,
2005. The re-appointment of the Managing Director is conditional upon and subject to termination by three calendar months notice
in writing on either side but no severance fees of any other kind is payable.
(6)
5.
The Company does not have any scheme for grant of Stock Options to its Directors, Managing Director or other employees.
SHARE TRANSFER-CUM-INVESTORS' GRIEVANCE COMMITTEE
The Share Transfer-Cum-lnvestors' Grievance Committee acts in accordance with the terms of reference specified by the Board from
time to time which, interalia, include overseeing and reviewing, all matters connected with investors' complaints and redressal
mechanism besides approval or authorisations for share transfer/transmission/refusal of transfer/consolidation/sub-division/
dematerialisation or rematerailisation, issue of duplicate share certificate(s), etc. as per applicable statutory and regulatory provisions.
The Chairman of the Committee is Shri J.Veeraraghavan, an Independent Non-Executive director and Shri D.R.Bansal, a NonExecutive director with Shri Pracheta Majumdar, an Independent Non-Executive director as its members. The Board also designated
Shri Gautam Sharma, Finance Manager & Assistant Secretary of the Company as Compliance Officer.
During the financial year ended 31 st March, 2006, two Share Transfer-Cum-lnvestor Grievance Committee Meetings were held on 30th
April, 2005 and 25th October, 2005. Shri J.Veeraraghavan and Shri D.R.Bansal were present in all the two meetings. Shri Pracheta
Majumdar did not attend any meeting.
During the year, complaints (excluding those correspondences which are not in the nature of complaints) were received from
shareholders and investors, directly or through regulatory authorities, details of which are given below:
SN&S&.ejgE^g^^
Share Transfer Matters
iSû^lwfgpfiBoSriiaiSfteiB&cfeivecJ::: :;:;:;: ::^)jrT)&^;:a^:6Sriipa^tS^B|3fleda^dy!eiiiix;s

12
12
Non-receipt of Dividend Warrants
Non-receipt of Annual Report
Others (excluding those specified above)
25
25
TOTAL
43
43
13
All the complaints have been attended/resolved to the satisfaction of the complainants during the year except for disputed cases and
sub-judice matters, which would be resolved on final disposal of the cases by the judicial and other authorities. No request for transfer
was pending for approval as on 31st March, 2006.
GENERAL BODY MEETINGS
Location and time where General Body Meetings were held in the last three years is given below:
11^^1*8^: ;i;3ji!isiii!iai8;i$
2002-03
::S;:;;;f^p;i::6t;:iv1^rtg::::H:::?::S ||;!^;il|ja(e;i|||f:;|;:i| llllli;iiSlll||:|:.::
Registered Office of the Company Udyog Vihar, RO.Chorhata,
AGM
1 0th July, 2003
11 a.m.
2002-03
Rewa (M.R) - 486 006
EGM
19th December, 2003
11 a.m.
2003-04
2003-04
Same as above
Same as above
AGM
EGM
20th July, 2004

17th December, 2004
11 a.m.
2004-05
2004-05
Same as above
AGM
EGM
19th July, 2005

16th December, 2005
11 a.m.
11 a.m.
Same as above
11 a.m.
All the resolutions set out in the respective notices of the above mentioned meetings were passed by the members as ordinary
resolutions except one special resolution concerning voluntary delisting of equity shares from Madhya Pradesh Stock Exchange,
Indore and The Calcutta Stock Exchange Association Ltd., Kolkata which was passed on show of hands. There were no special
resolution passed by the Company through postal ballot in any of the above meetings. In the ensuing Annual General Meeting, the
Company has proposed a Special Resolution related to alteration of Objects Clause of the Memorandum of Association of the
Company for approval by Postal Ballot. The Postal Ballot is conducted as per the procedures laid down in the Companies (Passing
of the Resolution by Postal Ballot) Rules, 2001.
7.
DISCLOSURES
(a) There are no materially significant related party transactions i.e. transactions of the Company of material nature, with its
promoters, the directors or the management, their subsidiaries or relatives, etc. that may have potential conflict with the interests
of the Company at large. Transactions with the related parties during the year have been disclosed in Note 4 of Schedule 22 to
the financial statements in the Annual Report.
(b) There has been no instance of non-compliance by the Company on any matter related to capital markets during the last three years
and no penalties or strictures have been imposed on the Company by the Stock Exchange(s) or SEBI or any statutory authority.
(c) The Company has generally complied with all the mandatory requirements as specified in the revised Clause 49 to the extent these
apply and extend to the Company.
(d) None of the subsidiary companies of the Company is a material non-listed Indian subsidiary as defined in Clause 49. The Audit
Committee of the Company periodically reviews the financial statements, in particular, the investments made by the unlisted
subsidiary companies. The Minutes of the Board Meetings of all the unlisted subsidiary Companies are placed at the Board Meeting
of the Company.
(e) In the preparation of the financial statements, the Company has followed the Accounting Standards issued by the ICAI The
significant accounting policies applied in preparation and presentation of financial statements have been set out in Schedule 23
forming part of the financial statements.
(f) The Company has laid down the procedures to inform the Board members about the risk assessment and minimization procedures
covering the entire gamut of business operations of the Company and the same have been reviewed by the Board during the year.
(g) The designated Senior Management Personnel of the Company have disclosed to the Board that no material, financial and
commercial transactions have been made during the year under review in which they have personal interest, which may have a
potential conflict with the interest of the Company at large.
(h) The CEO (Managing Director) and the CFO (Vice President (Commercial)) have furnished a Certificate to the Board for the year
ended 31st March, 2006 in compliance with the revised clause 49.V of the Listing Agreement(s) as amended.
(i)
In accordance with the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations. 1992, as amended, Shri
Gautam Sharma, Finance Manager & Assistant Secretary has been designated as the Compliance Officer of the Company under
the Company's Code of Conduct for Prevention of Insider Trading. He is responsible for adherence to the Code by the Company
and its designated employees. The Company also adheres to the disclosure practices for Prevention of Insider Trading as
specified in the aforesaid SEBI Regulations.
(j)
The Company has presently not adopted the non-mandatory requirements in regard to maintenance of Non-Executive Chairman's
office, tenure of independent directors, sending half-yearly declaration of financial performance to each household of
shareholders, unqualified financial statements, training of Board Members, mechanism for evaluating non-executive Board
Members and establishment of whistle blower policy, etc. However, the Company has a Remuneration Committee consisting of
three non-executive independent directors.
14
8.
MEANS OF COMMUNICATION
(a)
Quarterly Results :
Quarterly results after being reviewed by the Audit Committee are taken on record by the Board of Directors and submitted to
the Stock Exchanges as per requirements of the Listing Agreements. At present, Half Yearly report is not sent to each
household of shareholders.
(b)
Newspapers wherein results are normally published :

English Newspaper - Financial Express (All editions)
Vernacular Newspaper-Dainik Jag ran (Rewa edition)
(c)
Any website, where displayed :

www.vtlrewa.com
In addition, as required by SEBI and the listing agreement, the company has been regularly filing the required financial and other
informafion on the Electronic Data Information Filing and Retrieval (EDIFAR) system at website www.sebiedifar.nic.in
maintained by SEBI / National Informatics Centre.
9.
(d)
Whether it also displays official news releases : No
(e)
The presentations made to institutional investors or to the analysts : Nil
GENERAL SHAREHOLDER INFORMATION
9.1
Annual General Meeting:

Date, Time and Venue
9.2
12th July, 2006 at 11 A.M.

Registered Office of the Company at
Udyog Vihar, RO.Chorhata, Rewa (M.P.) - 486 006.
Financial Calendar (2006-07):

(tentative)
Quarterly Results :
Ending June 30,2006
Last
Ending September 30, 2006
Last week of October, 2006
week of July, 2006
Ending December 31,2006
Last week of January, 2007
Ending March 31, 2007
Last week of April, 2007
9.3
Book Closure date(s)
Thursday, 6th July, 2006 to Wednesday, 12th July, 2006

(both days inclusive)
9.4
Dividend Payment date
Not Applicable
9.5
Listing on Stock Exchanges
(a)
Bombay Stock Exchange Ltd., (BSE)

Phiroze Jeejeebhoy Towers,
Dalai Street, Fort, Mumbai - 400 001
(b)
National Stock Exchange of India Ltd. (NSE)

Exchange Plaza, C-1, Q.BIock.Bandra-Kurla Complex,
Bandra (East), Mumbai - 400 051
The Company has paid the Annual listing fees for the financial year 2005-06 to BSE & NSE.
9.6
Stock Code - Physical
: BSE, Mumbai -517015

NSE, Mumbai - VINDHYATEL BE
Demat ISIN Number for NSDL & CDSL : INE707A01012
9.7
Stock Market Data :

Monthly high and low quotations of shares and volume of Equity Shares traded on Bombay Stock Exchange Ltd., Mumbai
(BSE) and National Stock Exchange of India Ltd., Mumbai (NSE) are as follows :
15
iiiiiiiiiiM
:g:g|l*aiijS:;:;;;:
:?j!iK:fiSp?::
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
1
.-.....,-.-.......-.-.........-.-,-,... ....-......,-.-.-.-.......-.-.-.......,,-
iiiiiiii
mammim
;:ii;Va!;Bini6S;:S;:;S ::
':S;i{itiS;lSJ<JS:J:;H;ss:: :s :H::{insfis>:|s:xH
iiîyiSjUilSiSSSls;;
5ss(Sfi4f?iit>iSiJHf;?S;
April, 2005
79.10
69.60
82321
78.95
69.75
53994
May, 2005
134.55
70.40
846692
132.10
70.00
571627
June, 2005
186.45
144.75
541793
187.05
145.00
273769
July, 2005
172.90
144.05
226785
171.70
149.05
142796
August, 2005
206.00
150.90
734712
205.30
151.95
509178
September, 2005
194.55
179.75
463804
193.55
180.00
280317
October, 2005
182.00
.140.70
229463
182.00
136.00
42821
November, 2005
151.10
128.90
169979
150.00
129.10
94950
December, 2005
165.30
148.35
186509
165.10
147.55
84658
January, 2006
165.85
148.15
197041
166.00
148.00
60607
98195
73621
February, 2006
169.00
148.20
200777
169.05
151.00
March, 2006
178.00
142.90
157258
177.35
143.50
Share price performance in comparison to broad based indices - BSE Sensex :

Sham Price (Monthly High & Low) vs. BSL Sensox
Relative F'rlorniaru.:fi ol Monthly Clowinc) Sham F'r
|SfiflKBX-
9.9
Registrar and Share Transfer Agents
M/s Intime Spectrum Registry Ltd.
C-13, Pannalal Silk Mills Compound

L.B.S.Marg, Bhandup (West)
Mumbai-400078
Phone:+91-22-25963838
Fax :+91-22-25946969
Email :isrl@intimespectrum.com
9.10
Share Transfer System :

Trading in equity shares of the Company is permitted only in dematerialised form for all classes of investors as per notification
issued by the Securities & Exchange Board of India (SEBI).
All matters pertaining to share transfer and related activities are handled by the Registrar and Share Transfer Agents of the
Company who are fully equipped to carry out the transfers of shares and redressal of investors' complaint. All transactions in
connection with transfer, transmission, etc. are processed by them on fortnightly basis and is sent to the Company for placing
before the Committee of Directors/Committee of Officers, as the case may be for approval. With a view to expedite the
process of share transfer in physical segment, the Board of Directors has delegated the authority to a Committee of Officers
for approving transfer upto 1000 equity shares in each request. The average time taken for processing share transfer requests
in physical form including despatch of share certificates is generally three weeks, on receipt of duly completed documents in all
respects, while the request for dematerialisation of equity shares is confirmed/rejected within an average period of 15 days. The
Company obtains from a Company Secretary in practice half-yearly certificate of compliance with the share transfer formalities
as required under Clause 47(c) of the Listing Agreement with Stock Exchanges and files a copy of the certificate with the Stock
Exchanges.
16
The Company's representatives visit the office of the Registrar and Share Transfer Agents from time to time to monitor,
supervise and ensure that there are no delays or lapses in the system.
9.11 (a) Distribution of Shareholding as on 31st March, 2006 :
!i!!iillli!i!ii
;::; :
: : : i': :>ii-:':;i:::::::::::::::::::i:":":""::':':':::::':^:
:: ; ' : j : ; : i:5*.n;Wrln CwQ.TS?: :: :: :: ::
7992
90.31
1186453
10.01
501
1000
500
482
5.45
373530
3.15
2.40
1001
2000
190
2.15
284349
2001
3000
66
0.74
171265
1.45
3001
4000
23
0.26
79486
0.67
4001
5000
24
0.27
113348
0.96
5001
10000
20
0.23
130895
1.10
52
-
0.59
-
9504486
80.20
7051
0.06
GRAND TOTAL
8849
100.00
11850863
100.00
Physical Mode
3240
36.61
6595685
55.66
Electronic Mode
5609
63.39
5255178
44.34
10001 and above

Shares in transit
(NSDL/CDSL)
(b) Category of Shareholders as on 31st March, 2006 :
iiiiiii$iiii
illlililitliiiiiiiiil iiiiiiiffiii
liijsiijMii iSHareholdirtg:
::
::&jti!î[i^:::^^:^^:^^:^^^
^^^?^Kf^mmsiy^^Mssm?mmmmif>ifSmiSm^ ;sHS^fro|aSiS;:i: gSHiSejwijBbrS;

Indian Promoter(s)/Persons acting in concert
Resident Individuals & Corporates
26
0.29
6406243
54.06
8389
94.80
4250095
35.86
24
0.27
362016
3.05
410
4.64
825458
6.97
7051
0.06
8849
100.00
11850863
100.00
Financial Institutions/Insurance Companies/

Banks/Mutual Funds
NRIs/Flls/Foreign Bank
Shares in Transit (NSDL/CDSL)
GRAND TOTAL
9.12 Dematerialisation of Shares and liquidity : 5255178 Equity Shares representing 44.34% of total Equity Capital of the Company
are held in dematerialised form with National Securities Depository Limited (NSDL) and Central Depository
Services (India) Limited (CDSL) as on 31st March, 2006.
Company's shares are reasonably liquid and are quite actively traded on the Bombay Stock Exchange Ltd., (BSE) and National
Stock Exchange of India Ltd.(NSE). Relevant data for the approximate average daily turnover in terms of volume for the
financial year 2005-06 is given below
mmmm^mmmm
: : : : : : : : : : : : : :'x :9v?K : : : : : : : : : : x x : : : i
liiiiiiîlliiilllîlw^lllll
:;::::::::::::
:::::;;: : : : : : : :
16084
9146
25230
The Secretarial Audit Report from a Company Secretary in practice confirming that the total issued capital of the Company is in
agreement with the total number of equity shares in physical form and the total number of dematerialised equity shares held with
NSDL and CDSL, is placed before the Board on a quarterly basis. A copy of the Audit Report is submitted to the stock exchanges
where the equity shares of the Company are listed.
9.13 Outstanding GDRs/ADRs/Warrants or any Convertible Instruments, Conversion date and likely Impact on equity :The Company
has not issued any of these instruments so far.
9.14 Plant Location :
Udyog Vihar Industrial Area, P.O. Chorhata, Rewa (M.P.) - 486 006
17
9.15 Address for Correspondence :
M/s Intime Spectrum Registry Ltd.

C-13, Pannalal Silk Mills Compound
L.B.S.Marg , Bhandup (West)
Mumbai - 400 078
Phone :+91-22-25963838
Fax
Share Department
Vindhya Telelinks Limited
Udyog Vihar, P.O. Chorhata
Rewa(M.P.)-486006
Phone:+91-7662-400400
OR
: +91-22-25946969
Fax
Email : isrl@intimespectrum.com
: +91-7662-400591
Email : headoffice@vtlrewa.com
CERTIFICATE OF COMPLIANCE WITH THE CODE OF CONDUCT

As provided under Clause 49 of the Listing Agreement relating to Corporate Governance with the Stock Exchanges, all the Board Members
and the Senior Management Personnel of the Company have affirmed compliance with the Company's Code of Conduct during the financial
year 2005-06.
For Vindhya Telelinks Limited
R.G.Mundra
-Jew Delhi, 29th April, 2006
Managing Director
AUDITOR'S CERTIFICATE
To
The Members of Vindhya Telelinks Limited
We have examined the compliance of conditions of corporate governance by Vindhya Telelinks Limited fdr the year ended on March 31,
2006, 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.
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 S.R. BATLIBOI & CO.
Chartered Accountants
Per ANIL GUPTA
Partner
Membership No. 87921
Place : New Delhi

Date : April 29, 2006
18
Auditors' Report
TO THE MEMBERS OF VINDHYATELELINKS LIMITED
1.
We have audited the attached balance sheet of VINDHYA TELELINKS LIMITED as at March 31, 2006 and also the profit and loss
account and the cash flow statement 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.
2.
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.
3.
As required by the Companies (Auditor's Report) Order, 2003 (as amended) 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.
4.
Further to our comments in the Annexure referred to in Para 3 above, we report that;
(i)
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.
(ii)
In our opinion, proper books of account, as required by law, have been kept by the Company so far as appears from our
examination of these books.
(iii) the balance sheet, profit and loss account and cash flow statement dealt with by this report are in agreement with the books of
account;
(iv) In our opinion, 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.
(v) On the basis of written representations received from the Directors as on March 31, 2006 and taken on record by the Board of
Directors, we report that none of the Directors is disqualified as on March 31, 2006 from being appointed as a Director in terms
of Section 274 (1) (g) of the Companies Act, 1956;
(vi) In our opinion, and to the best of our information and according to the explanations given to us, the said accounts 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 the case of the Balance Sheet, of the state of affairs of the Company as at 31 March, 2006,
b)
in the case of the Profit & Loss Account, of the profit of the Company for the year ended on that date, and
c)
in the case of Cash Flow Statement, of the cash flows of the Company for the year ended on that date.
Per ANIL GUPTA
Place : New Delhi
Partner
19
Annexure referred to in paragraph (3) of our report of even date

Re : Vmdhya Telelinks Limited
(ix
(a) The Company has maintained proper records showing full particulars, including quantitative details and situation of fixed assets.
(iii)
(b)
Fixed assets have been physically verified by the management during the year and no material discrepancies were identified on
such verification.
(o)
There was no substantial disposal of fixed assets during the year.
(a)
The management has conducted physical verification of inventory at reasonable intervals during the year.
(b)
The procedures of physical verification of inventory followed by the management are reasonable and adequate in relation to the
size of the Company and the nature of its business.
(c)
The Company is maintaining proper records of inventory. No material discrepancies were noticed on physical verification.
(a)
As informed, 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. Therefore, the provisions of clause 4 (iii) (b), (c) and (d) of
the Companies (Auditor's Report) Order, 2003 (as amended) are not applicable to the Company.
(e)
As informed, the Company has not taken any loans, secured or unsecured from companies, firms or other parties covered in the
register maintained under Section 301 of the Companies Act, 1956. Therefore, the provisions of clause 4 (iii) (f) and (g) of the
Companies (Auditor's Report) (as amended) Order, 2003 are not applicable to the Company.
(iv)
In our opinion and according to the information and explanations given to us, there is an adequate internal control system
commensurate with the size of the Company and the nature of its business, for the purchase of inventory and fixed assets and for
the sale of goods and services. During the course of our audit, no major weakness has been noticed in the internal control system in
respect of these areas.
(v)
Based on the audit procedures applied by us and according to information and explanations provided by the management, we are of
the opinion that there are no transactions that need to be entered into the register maintained under Section 301 of the Companies Act,
1956. Therefore, the provisions of clause 4 (v) of the Companies (Auditor's Report) Order, 2003 (as amended) are not applicable to the
Company.
(vi)
The Company has not accepted any deposits from the public.
(vii)
In our opinion, the Company has an internal audit system commensurate with the size and nature of its business.
(viii) We have broadly reviewed the books of account maintained by the Company pursuant to the rules made by the Central Government
for the maintenance of cost records under Section 209(1 )(d) of the Companies Act, 1956 in respect to the products to which the said
rules are applicable, and are of the opinion that prima facie, the prescribed accounts and records have been made and maintained.
(ix)
(a)
The Company is regular in depositing with appropriate authorities undisputed statutory dues including provident fund, investor
education and protection fund, employees' state insurance, income-tax, sales-tax, wealth-tax, service tax, custom duty, excise
duty, cess and other material statutory dues applicable to it.
(b)
According to the information and explanations given to us, no undisputed amounts payable in respect of provident fund, investor
education and protection fund, employees' state insurance, income-tax, wealth-tax, service tax, sales-tax, customs duty, excise
duty, cess and other undisputed statutory dues were outstanding, at the year end, for a period of more than six months from the
date they became payable.
(c)
According to the records of the Company, the dues outstanding of income-tax , sales-tax, wealth-tax, service tax, custom duty,
excise duty and cess on account of any dispute, are as follows:
:!Ji:;(f.iii^^h^::a^(ifg:;iS!:!;;!i::;S:s;s:
Siiiir^:ot;*lw:S*StiirtS;?:::;:::::S;s5s;B |
|
|
|
|
|
|
|
|
|
!
|
|
|
|
|
|
|
|
^ IlllAJinSUimlill;;
SSSSSSS:;:;:;:^
:|g:;:RMfh:;:ffi&:;S;;i
Central Excise Act, 1944
Demand in case of valuation for

captive consumption of Machines
0.71
Central Excise Service Tax case
Appellate Tribunal, New Delhi.
for the period 1993-94
(x)
The Company has no accumulated losses at the end of the financial year and it has not incurred cash losses in the current year and
immediately preceding financial year.
(xi)
Based on our audit procedures and on the basis of information and explanations given by the management, we are of the opinion that,
the Company has not defaulted in repayment of dues to bank. We have been informed that the Company has not issued any
debenture nor availed any loan from any financial institution during the year.
(xii)
.According to the information and explanations given to us and based on the documents and records produced to us, the Company has
not granted loans and advances on the basis of security by way of pledge of shares, debentures and other securities.
20
(xiii)
In our opinion, the Company is not a chit fund or a nidhi / mutual benefit fund / society. Therefore, the provisions of clause 4(xiii) of
the Companies (Auditor's Report) Order, 2003 (as amended) are not applicable to the Company.
(xiv) In respect of dealing/trading in units of Mutual Funds, in our opinion and according to the information and explanations given to us,
proper records have been maintained of the transactions and contracts and timely entries have been made therein. The shares,
securities, debentures and other investments have been held by the Company, in its own name.
(xv)
According to the information and explanations given to us, the Company has not given any guarantee for loans taken by others from
bank or financial institutions.
(xvi) The Company did not have any term loans outstanding during the year.
(xvii) According to the information and explanations given to us and on an overall examination of the balance sheet and cash flow statement
of the Company, we report that no funds raised on short-term basis have been used for long-term investment.
(xviii) The Company has not made any preferential allotment of shares to parties or companies covered in the register maintained under
Section 301 of the Companies Act, 1956.
(xix)
The Company did not have any outstanding debentures during the year.
(xx)
The Company has not raised any money through a public issue during the year.
(xxi)
Based upon the audit procedures performed for the purpose of reporting the true and fair view of the financial statements and as per
the information and explanations given by the management, we report that no fraud on or by the Company has been noticed or reported
during the course of our audit.
Per ANIL GUPTA

Partner
Place : New Delhi

21
BALANCE SHEET AND PROFIT AND LOSS ACCOUNT

BALANCE SHEET AS AT 31ST MARCH, 2006
:
llll;;!!:;:a!^î|s:liiHsSi;;;;;;;;S|;iii:fiiSfe|;;:S:::
!ll!ll!!!: ;!!:p2i^f|f |;||||;|||||||9CJ|;;|:
iiiiiiieiiiiiflSiiiiiiii i:::;::i;:i:;|i;:;;:ir|S:::;in;;;JHCs::i;S;:; s;i;:i;;i:;:;:;iisiiii;:j|?s|x:

SOURCES OF FUNDS
SHAREHOLDERS' FUNDS
Share Capital
Reserves and Surplus
1182.09
20901.24
20770.55
22083.33
21951.87
1341.46
2207.29
1858.87
2509.78
3548.75
4368.65
53.97
105.39
25686.05
26425.91
13343.44
9140.40
13314.10
8741.65
4203.04
56.81
4572.45
1181.32
LOAN FUNDS
Secured Loans
Unsecured Loans
3
4
REFERRED TAX LIABILITIES (NET)
Total
APPLICATION OF FUNDS
FIXED ASSETS
Gross block
Less: depreciation
Net block
Capital work-in-progress
INVESTMENTS
4259.85
4572.45
11868.37
12072.28
7
8
9
10
11
2309.64
3057.26
3404.33
60.47
1517.12
1745.30
1570.61
3803.73
215.66
3003.96
10348.82
10339.26
598.04
363.56
194.52
CURRENT ASSETS, LOANS AND ADVANCES
Inventories
Sundry debtors
Cash and bank balances
Other current assets
Loans and advances

LESS: CURRENT LIABILITIES AND PROVISIONS
Current liabilities
Provisions
12
13
192.95
NET CURRENT ASSETS
Total
790.99
558.08
9557.83
9781.18
25686.05
26425.91
22
NOTES TO THE ACCOUNTS
The schedules referred to above and notes to the accounts form an integral part of the Ealance Sheet.
As per our attached report of even date.
For S.R.BATLIBOI & CO.

Per ANIL QUPTA
Partner
Membership No.87921
Chairman
R.S.Lodha
J.Veeraraghavan
S.K.Misra
R.C.Tapuriah
D.R.Bansal
\ Directors
H.V.Lodha
Pracheta Majumdar
New Delhi, April 29, 2006
R.G.Mundra
Managing Director
Gautam Sharma
New Delhi, April 29 2006
22
PROFIT & LOSS ACCOUNT FOR THE YEAR ENDED 31ST MARCH, 2006
1111 iiiphiijiiii llllliaiiiiiiii
III! llplilttlllllllllill|i!i|||l
I
^
i
l
i
i
l
l
l
i
l
i
i
i!l!!il!l;Jl!teii
INCOME
Turnover (Gross)
Less:- Excise duty
14
Turnover (Net)
Other income
15
15381.66
2144.63
10449.61
1384.27
13237.03
9065.34
694.01
1120.08
13931.04
10185.42
11029.49
10.23
577.74
1826.41
(255.64)
136.30
7789.70
200.60
506.37
- 1366.46
(198.18)
80.06
13324.53
9745.01
606.51
479.36
440.41
377.65
127.15
32.09
62.76
7.08
48.93
95.06
6.75
EXPENDITURE
Raw materials consumed

Cost of traded goods sold
Personnel expenses
Operating and other expenses
(Increase) in inventories
Financial expenses
16
17
18
19
20
PROFIT BEFORE DEPRECIATION, EXCEPTIONAL ITEM,

PRIOR PERIOD ITEMS AND TAX
Depreciation
21
PROFIT BEFORE EXCEPTIONAL ITEM, PRIOR PERIOD

ITEMS AND TAX
Exceptional item (Voluntary retirement compensation)

Prior period items (Refer Note No. 11 of Schedule 22)
PROFIT BEFORE TAX
Income tax for current year
2.35
Income tax credit for earlier years (Net)

Deferred tax (Credit)
(9.58)
(51.42)
(25.80)
Fringe benefit tax
14.60
Total tax (Income)
(34.47)
(35.38)
NET PROFIT FOR THE YEAR
129.53
42.13
42.13
Surplus carried to Balance Sheet
171.66
42.13
Earnings per share (EPS)
Weighted average number of equity shares in calculating basic and diluted EPS
11850863
Basic and Diluted (Nominal value of shares Rs.10/- each (Rs. 107- each))
1.09
11850863
0.36
22
3
The schedules referred to above and notes to the accounts fo m an integral part of the I rofit & Loss Account.
As per our attached report of even date
For S.R.BATLIBOI &CO,
R.S.Lodha
J.Veeraraghavan
Per ANIL GUPTA
Chairman
S.K.Misra
Partner
R.C.Tapuriah
D.R Bansal
Directors
H.V.Lodha
Pracheta Majumdar
RG.Mundra
Managing Director
Gautam Sharma
23
CASH FLOW STATEMENT FOR THE YEAR ENDED 31 ST MARCH, 2006

::::::::::::::x::::X-x;xX::;:X::|XX,j^:-xX^r:::x:x::;
SWraWftW:::*:::^^
PitfSirie^ySaf s*
:::::::: : x-XxX-XxX-x-Xx: x-x-x x-r ':::::::.:::

xSSSXxXj; : Xx:Xx;xXxendeSl[::3:1.St;:;::::::x:.
x-i-x-x-x-x-x-'-x-x-x-x :::::
x^ttQS&sUStxxXx:
111111111imimiii
A Cash flow from operating activities
Net Profit before tax
6.75
95.06
Adjustments for :
Depreciation
479.36
377.65
3.70
7.91
(Profit) on sale of current investments
(19.99)
(6.30)
Provision for diminution in the value of current investments
(27.12)
47.07
Interest income
(318.42)
(525.48)
Dividend income
(129.06)
(135.91)
Loss on disposal of fixed assets (Net)
Interest expense
67.91
Operating Profit/(Loss) before working capital changes
56.38
55.95
151.44
(179.11)
(172.36)
Movement in working capital:

Decrease/increase) in sundry debtors
(1486.65)
309.62
Decrease/flncrease) in inventories
(564.34)
792.60
Decrease/(lncrease) in loans and advances
(113.88)
55.14
Increase in current liabilities and provisions
223.38
Cash generated from/fused in) operations

Direct taxes refund received
Net cash from/(used in) operating activities
(1941.49)
102.34
1259.70
(1790.05)
1087.34
83.77
195.40
(1706.28)
1282.74
B. Cash flows from investing activities

Purchase of fixed assets
(202.70)
(255.95)
30.18
25.45
(350.00)
(935.36)
601.02
590.68
1500.00
550.00
Interest received
473.61
665.79
Dividend received
129.06
135.91
Proceeds from sale of fixed assets

Purchase of investments
Sale of investments
Deposits with bodies corporate & others
Net cash from investing activities
2181.17
24
776.52
CASH FLOW STATEMENT FOR THE YEAR ENDED 31 ST MARCH, 2006 (Contd.)
C. Cash flow from financing activities
Proceeds from share capital
Proceeds from share premium
Repayment of short term borrowings
(313.43)
Repayment of long term borrowings
(3018.70)
Interest paid
(52.22)
Dividend paid
(2.27)
Net cash (used in) financing activities
(874.29)
(3386.62)
Net (decrease) in cash and cash equivalents
(399.40)
(1327.36)
Cash and cash equivalents at the beginning of the year
3803.73
5131.09
Cash and cash equivalents at the end of the year.
3404.33
3803.73
87.05
159.50
Components of cash and cash equivalents as at 31st March

Cash and cheques on hand
With schedule banks
- on current accounts
478.38
- on deposits accounts
2815.08
- cash credit account
23.82
3404.33
Notes: (a) The Cash Flow Statement has been prepared under the 'Indirect method' as set out in Accounting Standard-3 on Cash
Flow Statements issued by the Institute of Chartered Accountants of India,
(b) Negative figures have been shown in brackets.
As per our attached report of even date.
R.S.Lodha
J.Veeraraghavan
Per ANIL GUPTA
S.K.Misra
Partner
R.C.Tapuriah
Membership No.87921
D.R.Bansal
Chairman
, Directors
H.V.Lodha
Pracheta Majumdar
R.G.Mundra
Managing Director
Gautam Sharma
25
SCHEDULES ANNEXED TO AND FORMING PART OF BALANCE SHEET AS AT 31 ST MARCH, 2006 AND
PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED ON THAT DATE
^m^mmmm^^mm^^m^/^^îi^ff^fw^^Mi^^m
liilllllll!!!^
iililllllill!!^
SCHEDULE 1 : SHARE CAPITAL
Authorised
equity shares of Rs.10/- each
1500.00
1500.00
1185.20
1185.20
1,18,50,863
equity shares of Rs.10/- each fully paid up
1185.09
1185.09
Less:
Calls unpaid
1,50,00,000
Issued
1,18,52,014
Subscribed
3.00
Total
1182.09
3.77
1181.32
SCHEDULE 2 : RESERVES AND SURPLUS
Capital Reserve
On revaluation of plant and machinery
Balance as per last account
9.27
11.59
Less:
Adjustment in respect of disposal of fixed assets
0.01
0.10
Less:
Transferred to Profit and Loss Account being difference of depreciation on

revalued cost of assets and that on the original cost
2.05
2.22
7.21
9.27
Securities Premium Account

3873.63
Add : Received during the year
3873.63
3.22
General Reserve
Profit and Loss Account
3876.85
3873.63
16845.52
16845.52
171.66
Total
20901.24
42.13
20770.55
SCHEDULE 3 : SECURED LOANS

Loans from Banks
Cash credit facilities from State Bank of India (SBI)
12.63
Foreign currency working capital loan (SBI)

Loans
against fixed deposit
receipts
1067.46
Interest accrued and due
3.73
Sales Tax Loans

Total
Notes: 1.
31.73
573.58
755.25
755.95
1341.46
1858.87
Repayment of sales tax loans, loans from Bank against fixed deposit receipts due within next twelve
months Rs.497.71 lacs (Rs.1067.46 lacs).
Cash credit borrowings including foreign currency loan (covered by forward exchange contracts) (fund and non fund based) from
SBI are secured by hypothecation of the Company's entire goods, movable and other assets, present and future, including
documents of title to goods and other assets such as book-debts, outstanding moneys, receivables, claims,
bills, invoices, documents, contracts, engagements, securities, investments and rights and all machinery,
present and future and further secured by deposit of all title deeds of the existing immovable properties of the
Company as and by way of collateral security and are further secured by way of pledge of 12,50,000 equity
shares of Birla Ericsson Optical Limited.
26
SCHEDULE 3 : SECURED LOANS (Contd.)
3. Loans from Banks against fixed deposit receipts are secured by way of pledge of fixed deposit receipts of
Rs. 150.00 lacs (Rs.1680.00 lacs).
4. Sales tax loans are as per scheme of State Government and for administration of these loans, Madhya
Pradesh State Industrial Development Corporation Limited (MPSIDC) has been nominated by the State
Government.
5. Sales tax loans from MPSIDC are secured by way of hypothecation of Company's all movable plant and
machinery, spares, tools and accessories and other movable assets, both present and future, ranking
subsequent and subservient to all charge(s) created/to be created in favour of SBI and are further secured or
to be secured by way of joint mortgage (on residual charge basis) created/to be created
by deposit of title
deeds of all immovable properties of the Company.
SCHEDULE 4 : UNSECURED LOANS
Sales Tax Loans (Refer Note No.4 of Schedule 3)
2509.78
2207.29
(Due within next twelve months Rs. 1257. 55 lacs (Rs.Nil))
SCHEDULE 5 : FIXED ASSETS
Rs. in lacs
:;;;:5::;:;SS;:S mm^s-^^^HiM^ '^^M?M^fiK^lMi^^^^ff^^
iji&iyeiiili;;;;;;^
Jfiiii&'&s!^.;.^:;^^
x::::i::::::: :::: ::;Xx ::::::::::::::::;: :;::x :':': 1 1::; !:::::: : ''' |::i--i|;2CJ05::-:^::::dWif^1^^:Â^StêStS:::;:::3^>3.2006-:-:::::
:::;::::::::::: :;:::: ;: :::-: ::: :::: :;:::^ ! ;, .::^.^^ ^y^--^/:^:^. y:^^^-^:^^.^: '^-:.\ ':::::'''' . ;;:::::.'::::::: x
!ili$!.$!
;;
-:taii^!?;8SrJiitS;;;;:^j^^
mmiM^îf^!l. îmmmiim^MiiM
LAND
Free Hold
'
Lease Hold
103.19
36.60
BUILDINGS
1985.57
PLANT & MACHINERY

FURNITURE & OFFICE
EQUIPMENT
VEHICLES
10882.17
218.15
88.42
TOTAL
13314.10
36.60
1986.51
0.94
102.33
103.19
4.75
71.27 10913.23
25.41 5.27
238.29
0.37
103.19
31.85
31.48
5.12
52.53
869.33
1117.18
1168.77
7716.33
412.92
56.38
8072.87
2840.36
3165.84
146.55
65.62
57.22
8741.65
12.33
3.26
481.41
3.21
2307
82.66
155.67
82.62
28.21
31.20
37.41
9140.40
4203.04
4259.85
Notes:
(1)
13300.21
71.60
4572.45
56.81
CAPITAL WOR K-IN-PROG RESS
PREVIOUS YEAR
103.19
816.80
116.55 13343.44
17.21 4001
145.89
255.95
242.06 13314.10
8570.38
379.87
208.60
4572.45
8741.65 4572.45
Freehold land includes Rs.5.47 lacs (Rs.5.47 lacs) given on lease.
(2)
Fixed assets of the value of Rs.25.59 lacs (WDV of Rs. 0.64 lac) have been discarded during the year.
(3)
Gross block of Plant and Machinery include Rs. 905.70 lacs (Rs. 906.63 lacs) on account of addition on revaluation during
the year ended March 31, 1990 as per valuation carried out by approved valuer.
27
;: :::::;x":;:::::;:v':;:x':x":x":x':x':::x':::::::::::::::::::::::::::::::::::::
:::::::::::::;:::::-:
- -:-.-.: . . --. I-:-.-;-:-:-:-:-:-;-:-: .-.--:-;-:-: I-;-:-:---:-:-: :-: :-:-;-.-. - : : x-.-x-x-x-x-x-x-x-. : : : : : \ . : :- - .-. - -:-: : :-. ':-:,::-.. . :- :- : --::-::.-:.: : : . : . - - . -
' : ' : i : i : i : i ; i : " : ' : '- :-:-:':<'---'- : ' : ' : ' : ' " ' ; ' ' 1 ' ' 1 '- x-x-x-x-x-x-x- :- : :-::-;:: I-:-:-:-:-:-:-:---.-- . : ..:::.:::::-.:-: ::: O1 1* tJlAff-h '- ' : x '"x"x : -: - ; - - - - -: : :\<a^ fri':MAf^h
;: : :;-::::::;:::;:::::;::::::::::::::::::::::::::::::::::>::':::::::>::::-:::::::::::::
îfff^^^mm^f^M^ffiMf^^^^myj^Mf''1^^-^^^^^^^
SCHEDULES INVESTMENTS
Long Term Investments

(A) Trade
Quoted - Fully paid up equity shares of Rs. 10/- each.
994.75
31,39,139
(31,39,139)
Universal Cables Ltd.
994.75
40,00,100
(40,00,100)
Birla Ericsson Optical Ltd.
900.01
900.01
63,80,243
(63,80,243)
1917.58
1917.58
2199.00
Unquoted - Fully paid up equity shares of Rs. 10/- each.

In the Subsidiary Companies
44,22,000
Optic Fibre Goa Ltd."
2199.00
1,52,50,200
(1,52,50,200)
(44,22,000)
August Agents Ltd.
1525.02
1525.02
1,50,00,200
(1,50,00,200)
Insilco Agents Ltd.
1500.02
1500.02
1,50,00,200
(1,50,00,200)
Laneseda Agents Ltd.
1500.02
1500.02
Other than the Subsidiary Companies

2,99,940
(2,99,940)
(46,00,000)
1,20,00,000
(1,20,00,000)
Birla Financial Corporation Ltd.
29.99
Universal-ABB Power Cables Ltd.
29.99
460.00"
Punjab Produce Holdings Ltd.
1200.00
1200.00
9,800
(9,800)
Universal Telelinks Ltd.
0.98
0.98
9,800
(9,800)
Universal INP (USSR) Electricals Ltd.
0.98
0.98
0.02
0.02
(B) Other than trade
Unquoted - Fully paid up equity shares of Re.1/- each

6,900
(6,900)
Free Press House Ltd
Current Investments - Trade

Unquoted - Fully paid up units of Mutual Funds of Rs. 107- each
(13,35,873)
(6,90,657)
SBI Magnum Sector Funds Umbrella Pharma*
273.10
Franklin Templeton India Ltd.- FT India Monthly

Income Plan - Monthly Dividend - Reinvestment
77.88
1,63,457
(-)
TINFD Tata Infrastructure Fund - Dividend

(NAV as on 31-3-2006 - Rs. 31.51 lacs)
25.00
1,67,096
(-)
Tata Service Industry Fund - Dividend
25.00
(NAV as on 31-3-2006 - Rs. 28.46 lacs)
5,00,000
(-)
ING Vysya Mutual Fund - Lion Fund -Dividend Option

.(NAV as on 31-3-2006 - Rs. 55.75 lacs)
50.00
11868.37
12579.35
11868.37
T2072.28
* Less :x Provision tor diminution in the value of investment
507.07
Total
Aggregate amount of quoted investments

Market value of quoted investments
Aggregate amount of unquoted investments
3812.34
3812.34
25376.83
13799.82
8056.03
8767.01
* Company under the same management.

Note: 3,845 units of Franklin Templeton India Ltd.- FT India Monthly Income Plan - Monthly Dividend -Reinvestment. 19,75.954 units
of HDFC Liquid Fund: Daily Dividend and 5,00,000 units of SBI Magnum Multicap Fund: Dividend were purchased and sold
during the year.
28
SCHEDULE 7 : INVENTORIES
Raw materials
912.84
Stores and spares
323.59
16.18
Traded goods
Work-in-progress
Finished goods
1017.57
Scrap
535.72
389.77
18.42
781.32
9.90
39.46
10.17
2309.64
1745.30
3.27
31.66
41.03
31.17
287.84
123.59
133.33
100.47
Considered doubtful
2766.15
3.82
1396.25
11.14
Less: Provision for doubtful debts
3216.33
159.07
1713.39
142.78
3057.26
1570.61
87.05
159.50
464.42
23.82
17.93
122.92
2815.08
13.96
3486.10
17.28
3404.33
3803.73
60.47
215.66
8.44
8.82
67.93
Total
SCHEDULE 8 : SUNDRY DEBTORS (UNSECURED)
For sales on deferred payment terms

Debts outstanding for a period exceeding six monthsConsidered good
Considered doubtful
For other sales

Considered doubtful
Other debts
Considered good
Total
SCHEDULE 9 : CASH AND BANK BALANCES
Cash on hand (including cheques/ drafts in hand Rs.80.69 lacs (Rs.153.75 lacs)
Balance with scheduled banks
On current/collection accounts
cash credit account
fixed deposit accounts (including fixed deposits receipt of Rs. 1230. 00 lacs
(Rs. 2935.00 lacs) pledged with banks)
unclaimed dividend accounts (including fixed deposits of Rs.3.50 lacs (Rs. 3.50 lacs))
Total
SCHEDULE 10 : OTHER CURRENT ASSETS
Interest receivable on deposits and others

SCHEDULE 11 : LOANS AND ADVANCES (UNSECURED)
Considered good
loans to employees
Advances recoverable in cash or kind or for value to be received
48.52
Deposits
-Inter-corporate
1150.00
51.55
202.76
- Others
Balance with custom, excise etc.
Advance payment against tax less provision
Claims, refunds etc. receivable
Considered doubtful
Less: Provision
Total
2650.00
48.52
60.35
11,73
112.45
44.12
55.89
16.31
16.31
1533.43
3020.27
16.31
16.31
1517.12
3003.96
Included in Loans and advances are :

Due from an officer of the Company Rs. 0.82 lac (Rs.0.38 lac). Maximum balance outstanding at any time during the year Rs 0-99 lac
(Rs.0.47 lac)
29
SCHEDULE 12 : CURRENT LIABILITIES
Acceptances
Sundry creditors
Advance from customers
Interest accrued but not due
Investor Education and Protection Fund shall be credited by the following amount on due date :
Unclaimed dividend
Total
Included in sundry creditors are:

Payable to overseas creditors not covered by forward exchange contracts
Due to small scale industrial undertakings
64.06
483.45
333.96
23.72
12.32
12.85
13.96
17.28
598.04
363.56
64.06
76.59
56.39
The name of small scale industrial undertakings to whom amount is outstanding for more than 30 days are Alok Industries Delhi, Bells
and Alok Masterbatches Ltd. Delhi.
Insulations Pvt. Ltd. Delhi, Siddhartha Plastic Industries Daman, Silvassa Wooden Drums Silvassa
SCHEDULE 13 : PROVISIONS
For Custom duty

Gratuity
75.33
., Leave encashment
72.18
64.64
., Pension
45.44
43.51
24.42
Total
61.95
192.95
194.52
14814.11
9814.51
567.55
15381.66
635.10
10449.61
SCHEDULE 14 : TURNOVER
Finished Goods
Miscellaneous
Total
SCHEDULE 15 : OTHER INCOME
Interest:
-on sale on deferred payments (Gross)
3.33
(Tax deducted at source Rs.Nil (Rs.Nil))

-on bank deposits (gross) (Tax deducted at source Rs 1.38 lacs (Rs.10.30 lacs))
143.92
174.50
237.66
284.49
127.10
1.96
99.89
35.24
27.12
24.01
19.99
3.26
37.02
63.80
72.11
33277
33.37
694.01
1120.08
Inventories as at 31st March, 2005

Add: Purchases (Less : sales and claims Rs. 55.54 lacs (Rs. 19.28 lacs))
535.72
11406.61
1446.02
6879.40
Less: Inventories as at 31st March, 2006
11942.33
912.84
8325.42
535.72
11029.49
7789.70
461.61
69.63
46.50
424.56
33.27
48.54
577.74
506.37
-others (gross) (Tax deducted at source Rs. 0.68 lac (Rs.5.49 lacs))
Dividend income
-on investments (Long term) (Trade)
-on investments (Current) (Trade)
Discount on prepayment of interest free sales tax loan liability
Unspent liabilities/sundry balances written back
Provision for diminution in the value of investment written back
Provision for doubtful debts written back
Profit on sale of current investments - Trade
Profit on disposal of fixed assets
Miscellaneous income
Total
3898
6.30
3.99
43.28
SCHEDULE 16 : RAW MATERIALS CONSUMED
Total
SCHEDULE 17 : PERSONNEL EXPENSES
Salaries, wages and bonus
Contribution to provident and other funds

Workmen and staff welfare expenses
Total
30
1111;;:;;^^^^^^^^^
SCHEDULE 18 : OPERATING AND OTHER EXPENSES
Consumption of stores and spares

Packing materials
Power and fuel
Sales commission
Freight and transportation (Net)

Processing and testing charges
Excise duty on stocks etc.
Rent
Rates & taxes
Insurance charges
Repair & maintenance :
- Plant & machinery
- Buildings
- Others
Directors' sitting fees
284.58
339.23
352.43
9.60
15.56
245.86
5.03
8.83
23.11
28.38
210.31
238.40
326.78
3.44
39.92
54.11
13.95
1.74
15.49
35.05
13.73
1.21
3.00
0.75
1.75
4.50
5.00
0.87
3.00
0.75
1.89
4.62
3.84
0.82
19.64
46.42
3.81
15.47
8.32
26.22
Auditors' remuneration
Statutory auditors
-Audit fees
-Tax audit fees
-Company law matters

-Quarterly reviews
-Certification, etc.
-Out of pocket expenses
Cost auditors
-Audit fees
-Reimbursement of expenses

Provision for doubtful debts and advances
Sundry advances/ bad debts written off

Loss on disposal of fixed assets
Exchange rate fluctuation (Net)
Miscellaneous expenses
Total
0.30
0.07
42.48
1.26
6.96
32.26
304.88
1826.41
0.30
0.16
47.07
32.55
13.66
11.90
7.46
274.15
1366.46
SCHEDULE 19 : (INCREASE) IN INVENTORIES
Work-in-progress
1017.57
39.46
1057.03
781.32
781.32
9.90
10.17
801.39
586.96
10.06
6.19
603.21
Total
(255.64)
(198.18)
Total
67.91
68.39
136.30
55.95
24.11
80.06
379.87
Total
481.41
2.05
479.36
Finished goods
Scrap
Work-in-progress
Finished goods
Scrap
9.90
10.17
801.39
SCHEDULE 20 : FINANCIAL EXPENSES
Interest
- to banks and others
Bank charges
SCHEDULE 21 : DEPRECIATION
On fixed assets
Less: Transfer from capital reserve
31
2.22
377.65
SCHEDULE 22 : NOTES TO THE ACCOUNTS

NATURE OF OPERATIONS:
Vindhya Telelinks Limited, a M. P. Birla Group Company, is engaged in the business of manufacturing and selling of Jelly Filled
Telephone Cables, Optic Fibre Telephone Cables and Fibre Ribbon.
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES:
(a)
Basis of Preparation:
The Financial Statements have been prepared to comply in all material respect with the mandatory Accounting Standards
issued by the Institute of Chartered Accountants of India and the relevant provisions of Companies Act, 1956. The Financial
Statements have been prepared under the historical cost convention modified by revaluation of fixed assets, on an accrual
basis. The accounting policies have been consistently applied by the Company and are consistent with those used in the
previous year.
(b)
Fixed Assets:
Fixed Assets are stated at cost (including revalued amounts), less accumulated depreciation and impairment losses, if any.
Cost comprises the purchase price and any attributable cost of bringing the asset to its working condition for its intended use.
Financing costs relating to acquisition of fixed assets are also included to the extent they relate to the period till such assets
are ready to be put to use. When fixed assets are revalued any surplus on revaluation is credited to assets revaluation
reserve.
The carrying amounts of assets are reviewed at each balance sheet date if there is any indication of impairment based on
internal/external factors. An impairment loss is recognized wherever the carrying amount of an asset exceeds its recoverable
amount. The recoverable amount is the greater of the assets' net selling price and value in use. In assessing value in use,
the estimated future cash flows are discounted to their present value at the weighted average cost of capital.
(c)
Depreciation:
(i)
Premium on leasehold land is amortized over the life of the lease
(ii)
Depreciation in respect of second hand Plant and Machinery purchased during the last year, which are estimated to have
lower residual lives than envisaged as per the rates provided in Schedule XIV to the Companies Act, 1956 has been
provided based on the estimated lower residual life, using the straight line method.
(iii)
Depreciation on Fixed Assets of Unit No.1 and Computer Systems is provided on Written Down Value Method at rates,
computed based on estimated useful life of the assets, which are equal to the corresponding rates
prescribed under Schedule XIV to the Companies Act. 1956.
(iv)
Depreciation on all other Fixed Assets is provided on Straight Line Method at rates, computed based on estimated useful
life of the assets, which are equal to the corresponding rates prescribed under Schedule XIV to the
Companies Act. 1956.
Depreciation on additions due to foreign exchange fluctuation is provided over the remaining useful lives of the assets.
Depreciation on insurance spares is provided retrospectively from the date the related mother assets are put to use
(d)
Investments:
Investments that are readily realizable and inter.ded to be held for not more than a year are classified as current investments.
All other investments are classified as long term investments. Current investments are carried at lower of cost and fair value
determined on an individual investment basis. Long term investments are carried at cost. However, provision for diminution
in value is made to recognize a decline other than temporary in the value of the investments.
(e)
Inventories:
Inventories are valued as follows:
Raw materials, Stores & spares and Traded goods
Lower of cost and net realizable value.

Cost is determined on a weighted average basis.
Work-in-progress and Finished goods

(Own manufactured)
Lower of cost and net realizable value

Cost includes, direct materials and labour & proportion of
manufacturing overheads based on normal operating capacity. Cost
of finished goods includes excise duty.
Scrap
Net realizable value.
Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and
to make the sale.
(f)
Revenue Recognition:
Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue
can be reliably measured.
Sale of Goods
Revenue is recognized when the significant risks and rewards of ownership of the goods have passed to the buyer. Credits;
debits arising out of finalisation of provisional prices on supplies are accounted for in the year of their acceptance since it is
not possible to ascertain the exact quantum in respect thereof with reasonable accuracy.
32
VINDHYATELEUNKS LIMITED
Interest
Revenue is recognized on a time proportion basis taking into account the amount outstanding and the rate applicable.
Dividend
Revenue is recognized when the shareholder's right to receive payment is established by the Balance Sheet date.
(g)
Foreign Currency Transactions:

(i)
Initial Recognition
Foreign Currency Transactions are recorded in the reporting currency, by applying to the foreign currency amount the
exchange rate between the reporting currency and foreign currency at the date of the transactions.
(ii)
Conversion
Foreign currency monetary items are reported using the closing rale.
(iii)
Exchange Differences
Exchange differences arising on the settlement of monetary items at rates different from those at which they were
initially recorded during the year, or reported in previous financial statements, are recognized as income or as expense
in the year in which they arise except those relating to acquisition of fixed assets from outside India which are adjusted
to the carrying amount of fixed assets.
(iv)
Forward Exchange Contracts not intended for trading or speculation purposes

The premium or discount arising at the inception of forward exchange contracts is amortized as expense or income over
the life of the contract Exchange differences on such contracts are recognized in the statement of profit and loss in
the year in which the exchange rate changes. Any profit or loss arising on cancellation or renewal of forward exchange
contract is recognized as income or expense for that year.
(h)
(i)
Retirement and other Benefits:

(i)
Retirement benefits in the form of Provident Fund and Superannuation Fund are charged to profit and loss account of
the year when contributions to the respective funds are due. The Company accounts for the contributions under
Superannuation Scheme being made/to be made to Life Insurance Corporation of India (LIC) against an insurance policy
taken with them.
(ii)
Provision for gratuity (including past services of employees who were in other group companies), leave encashment and
pension is accrued and provided for on the basis of an actuarial valuation made at the end of each financial year.
(iii)
Payments made under Voluntary Retirement Scheme are charged to the profit and loss account in the year in which the
employee accepts the early retirement.
(iv)
Ex-gratia or other amount disbursed on account of selective employees separation scheme are charged to Profit & Loss
Account.
Income Taxes :
Tax expenses comprise current, fringe benefit and deferred taxes. Current income tax and fringe benefit tax are measured at
the amount expected to be paid to the tax authorities in accordance with the Indian Income Tax Act. Deferred Income Tax
reflects the impact of current year timing differences between taxable income and accounting income for the year and reversal
of timing differences of earlier years. Deferred Tax is measured based on the tax rates and the tax laws enacted or
substantively enacted at the Balance Sheet date. Deferred tax assets are recognized only to the extent that there is a
reasonable certainty that sufficient future taxable income will be available against which such deferred tax assets can be
realized. Deferred Tax Assets are recognized on carry forward of unabsorbed depreciation and tax losses only if there is virtual
certainty that such deferred tax assets can be realized against future taxable profits. Unrecognized deferred tax assets of
earlier years are re-assessed and recognized to the extent that it has become reasonably certain that future taxable income will
be available against which such deferred tax assets can be realized.
(i)
Earnings Per Share:

Basic earnings per share is calculated by dividing the net profit or loss for the year attributable to equity shareholders by the
weighted number of equity shares outstanding during the year. The weighted average number of equity shares outstanding
during the year are adjusted for events of bonus issue, bonus element in a rights issue to existing shareholders, share splits
and reverse share split (consolidation of shares).
For the purpose of calculating diluted earnings pel shaie, the net piofit or loss for the year attributable to equity shareholders
and the weighted average number of shares outstanding during the year are adjusted for the effects of all dilutive potential
equity shares.
(k)
Provisions:
A provision is recognized when an enterprise has a present obligation as a result of past event, it is probable that an outflow
of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions except
those disclosed elsewhere in the notes to the financial statements, are not discounted to its present value and are determined
based on best estimate required to settle the obligation at the balance sheet date. These ale leviewed at each balance sheet
date and adjusted to reflect the current best estimates. Provision foi expenditure relating to voluntary retiiement is made when
the employee accepts the option of early retirement under the Voluntary Retirement Scheme.
33
SEGMENT INFORMATION:
The Company is solely engaged in the activity of manufacturing Telephone Cables i.e. Jelly Filled Telephone Cables, Optical
Fibre Telephone Cables and their raw material i.e. Fibre Ribbon. The entire operations are governed by the same set of risk
and returns and hence has been considered as representing a single segment The said treatment is in accordance with the
guiding principles enunciated in the Accounting Standard 17 on Segment Reporting.
The Company sells its products mostly within India with insignificant export income and does not have any operations in
economic environments with different risks and returns. Hence, it is considered operating in a single geographical segment.
RELATED PARTY DISCLOSURE:
Subsidiaries
August Agents Ltd.*, Insilco Agents Ltd.",

Laneseda Agents Ltd.* and Optic Fibre Goa Ltd.*
Joint Ventures
Birla
Ericsson Optical Ltd. and Universal-ABB
Power Cables Ltd.*

Key Management Personnel
Shri R.G.Mundra (Managing Director)
Other parties which significantly Influence/are

influenced by the Company (either individually
or with others)
* No transaction has taken place during the year.
Universal Cables Ltd. and Madhya Pradesh State IndustrialDevelopment Corporation Limited
# Refer Note No. 8 of Schedule 22.
Note:- The Company by itself or along-with its three subsidiaries hold more than 20% of the voting power of two other Companies.
In the opinion of the management, the Company does not have any "significant influence" in the said two Companies as
defined in Accounting Standard (AS)'18' "Related Party Disclosure". The Company has also sought legal opinion regarding this
and therefore, has not considered the above investees as a "Related Party" under AS-18.
Rs. in lacs
Transactions during the year
a)
Purchases of raw-materials,
finished goods, stores, spares

and packing materials
b)
415.28
49.53
116.30
14.85
4.66
71.12
1.15
0.05
140.77
9.32
5.93
9.74
10.52
2.32
6.90
3.00
7.55
9.70
52.45
19.97
2.13
4.89
19.51
18.69
2.45
0.01
10.98
313.85
1.02
157.73
162.78
800.00
2300.00
1050.00
Sale of raw-materials,
finished goods.stores,spares
and packing materials
c)
Other service charges/ lease rent

received
d)
Other service charges paid
85.38
e)
Sale of fixed assets
f)
Purchases of fixed assets
g)
Interest on inter-corporate
deposits received
h)
Interest on inter-corporate
deposits paid
i)
Inter-Corporate deposits granted
440.00
j)
Inter-Corporate deposits refunded
440.00
k)
Inter-Corporate deposits taken
20600
I)
Inter-Corporate deposits repaid
206.00
1.02
1.19
400.00
Balance outstanding at the year end

a)
Sureties
b)
c)
Receivables
Payables
0.08
0.84
34
29.00
171.99
1150.05
2650.00
Rs. in lacs
(iii) Managing Director Remuneration

11.44*
10.83'
' Excluding contribution/provision for gratuity, provisions for pension and leave encashment, being the figures those are actuarially
determined for the Company as a whole and therefore, are not separately available.
Notes
(i)
(ii)
No amount has been provided as doubtful debt or advance written off or written back in the year in respect of debts due
from/to above related parties.
Transactions and balances relating to reimbursement of expenses to/from related parties have not been considered
above.
INTEREST IN JOINT VENTURE COMPANIES:
Pursuant to Accounting Standard '27' "Financial Reporting of Interest in Joint Ventures" the relevant information relating to following
Joint Venture Companies is as given below:
Name of the Joint Venture Companies
Birla Ericsson Optical Ltd. (BEOL)
HCoWntfy::<WK;ssK;:: PCOpSftiori tjf

:: ;
;
>||orp|||on| spwrj8f^hip : :;: s:;:: -::r;
slnterest:;::::::-:;;:;-::1; /
India
13.33%
EJesqr fjjf icrtt 6f Inter *!
JV is established principally for

manufacture of Optic Fibre Cables
and Jelly Filled Telephone Cables.
Universal-ABB Power Cables Ltd. (UAPCL)
India
JV was established principally for
4.62%
manufacture of High Voltage

Power Cables.
The Company's share in the aggregate amounts of each of the assets, liabilities, income, expenses, contingent liabilities and capital
commitments as at/for the years ended 31st March, 2006 and 31st March, 2005 in the above companies as per their respective
audited financial statements are as under. For UAPCL, the Company, has during the year written off entire value of investment since
UAPCL has wound up the operations during the year. As Company's exposure was limited to the amount invested, those details have
not been furnished for UAPCL.
lifiiillliils
;;i;^;l:;!^
;:N:aws;aSJb;fr!t;:vîi*8;^:B::g
Assets
-Fixed assets (Net block)
400.81
412.83
-Investments
-Inventories
-Sundry debtors
250.77
311.33
218.35
122.29
140.88
146.58
-Cash and bank balances
432.09
334.95
-Other current assets

-Loans and advances
3.38
89.10
Total
1535.38
15.28
108.14
1451.40
Liabilities
-Secured loans
205.45
146.31
-Unsecured loans
308.72
340.90
-Deferred tax liabilities (Net)
3.69
-Current liabilities and provisions

Total
15.75
96.15
56.55
61-, .01
559.51
1153.07
802.04
68.95
111.66
1129.30
837.33
Income
-Income from operations
-Other income
Expenses
-Manufacturing and other expenses
-Interest and financial charges
11.30
6.23
-Depreciation
61.58
61.30
-Provision for tax

-Contingent liabilities
-Capital commitments
(9.66)
(0.54)
822.69
886.01
1.60
35
3.77
Estimated amount of contracts remaining to be executed on Capital Account (Net of advances) and not provided for Rs,9.00 lacs
(Rs.Nil).
Contingent liabilities (not provided for) in respect of :
(i)
Sureties given on behalf of a Body Corporate Rs. 29.00 lacs (Rs.171.99 lacs).
(ii)
Claims against the Company not acknowledged as debts Rs.4.22 lacs" (Rs 4.22 lacs)
(iii)
Pending cases with Income-Tax Appellate authorities where Income Tax Department has preferred Appeals - liability not
ascertainable.
" Based on the discussions with the Solicitors, the management believes that the Company has a strong chance of success
in the above mentioned cases and hence no provision there against is considered necessary.
The Company has an investment of Rs. 2199.00 lacs in Optic Fibre Goa Ltd (OFGL) (a Subsidiary Company and also a Joint Venture)
promoted by it. The aforesaid subsidiary is presently incurring losses. The equity share capital and share premium as on 31st March
2006 is Rs. 804.00 lacs and Rs. 3196.00 lacs respectively and accumulated losses are Rs. 612.74 lacs. The Board of Directors of
OFGL in its meeting held on 18th April, 2006 has decided to merge the Company with one of its promoter company w.e.f. April 1. 2005
and has initiated the process of getting requisite approvals. However, in view of long term and strategic investment in the aforesaid
subsidiary, no provision is considered necessary to adjust the value of investment at this stage.
The Company has filed a law suit against an overseas supplier and its agent relating to the validity and existence of an alleged
agreement before a competent court which is already seized of the said suit. The supplier in order to overreach the said Law Suit has
initiated an arbitration for claiming recovery of value of the unsupplied goods for the period from October, 2002 to September, 2006
aggregating to Rs.4309.41 lacs (value as on 31st March, 2006). The said arbitration proceedings have been stayed by the order of
the Competent Court. The Company has been legally advised that the said claim against the Company is unsustainable and there is
no likelihood of any liability arising against the Company.
10,
The Company, has during the year, made prepayments of Deferred Sales Tax Interest Free Loan Liability of Rs.303.19 lacs
(Rs. 2048.78 lacs) as per relevant Notification issued by the Madhya Pradesh State Government, The discount received against such
prepayment amounting to Rs.99.89 lacs (Rs.332 77 lacs) has been included under other income.
Prior period items comprise of expenses in respect of demand charges from Madhya Pradesh State Electricity Board amounting
Rs.14.10 lacs (Rs.Nil), Interest on above Rs.2.05 lacs (Rs.Nil). Municipal Tax Rs.6.78 lacs (Rs.Nil) and Gratuity Liability Rs.9.16 lacs
(Rs.48.93 lacs).
12.
(i) Components of Deferred tax arising on account of timing differences alongwith their movement as at 31st March, 2006 is as
given below:
Deferred tax liability (A)
Differences in depreciation and other differences in block of
fixed assets as per tax books and financial books
641.20
693.10
587.23
587.71
53.97
105.39
Deferred tax asset (B)

Unabsorbed depreciation
Deferred tax liability (Net) (A-B)
(ii)
Pursuant to Accounting Standard (AS) 22 "Accounting for Taxes on Income", the Company, has, based on prudence, not
recognised deferred tax assets amounting to Rs.473.79 lacs (Rs.524.26 lacs) on all the timing differences excepting
unabsorbed depreciation.
13.
SUPPLEMENTARY STATUTORY INFORMATION:
13.1
Managerial Remuneration :
Ilia
!: :
: ?.;::::: :".'
(a)
Salary
: ; " - ' :;:
2005-2Q06
' ;: 2004-200S
Rs.;;in:laiis
'. V*': :;:.!. Rs: in :|acs;
8.63
8,18
(b)
Commission**
(c)
Contribution to Provident Fund
1.04
0.95
(d)
Sitting Fees
0.20
0.21
(e)
Perquisites
1.57
1.49
11.44*
10.83'
Excluding contribution/provision for gratuity, provision for pension and leave encashment, being the figures those are actuarially
In view of loss computed in accordance with Section 349 of the Companies Act. 1956. no commission is payable to Managing
Director of the Company.
36
'jjjiijj^
13.2
13.3
13.4
14.
'
|aC5:;::::;::: : :: : : x;x;;:x > :;:R;Brifl I3C5 :
flS.tfl
Earnings in Foreign Exchange

Exports of goods on FOB basis
Expenditure in foreign currency (on cash basis)
Interest
Professional/technical Fee (Net of tax)
Travelling
Others
Value of imports on GIF basis
(as certified by the management)
Raw materials
Spare parts
Traded goods
Capital goods
60.93
21.14
6.52
2.68
0.18
24.76
0.57
7077.35
45.12
6.73
103.85
29265
14.30
135.28
Additional information pursuant to the provisions of paragraphs 3, 4C and 4D of Part-ll of Schedule VI to the Companies Act, 1956.
(a) (i) Licensed Capacity, Installed Capacity and Actual Production:
1!^
: : : :
x : : ::::.::::.::::::::::::::::::;;:.
lllllilPllliiM
CKMs
(b) Optical Fibre Cables
KMs
10700000
10700000
7454000
7454000
1967263
1518841
34272
34272
34272
34272
5629
4833
2421
12
(c) Machines foi manufacturing

Cables & Conductors
Nos.
40
40
40
40
(d) Coiled/Straight Cords
Sets
2000000
2000000
2000000
2000000
(e) Stranded Copper Wire
MTs
40
40
40
40
50000000
50000000
50000000
50000000
75000
75000
(f) Insulated Cables, Cords

& Flexes
Mtrs.
(g) Fibre Ribbon
KMs
Sales (Gross) :
:;;:.:;;PM!fltjii:;::^
:
. . - ' :::i:.'::.'.
^lSBlll|illiiilll-2bb5'':
(a) Jelly Filled Telephone Cables
(ii)
' ::':': :V:i::X:':::':: : .'- '
l^j^^^::.:;::.:^^^^^^-^\^;
;. . ;; . : ;::
1 :
: :.8z&-\ ' ^&?^vZ^&;^.: : :K: M:.': ' '^Xfi:< ;?/ "-'
iiS*': ':': ''' '.
: :
;: ::
^ : .Qfy. 5 ' K S ^ ' .S' : '
l^: *$?.'' ''' ' :;::: K^f:t^'.^ S: f. ^"^ : :: :
(a) Jelly Filled Telephone Cables
CKMs
1970075
12137.98
1518517
(b) Optical Fibre Cables
KMs
5629
2336.75
4809
(c) Fibre Ribbon
KMs
2433
339.38
Total
* Including Sale of traded goods Rs. 7.43 lacs (Rs. 367.83 lacs)
Differences in quantitative tally are due to own consumption and samples returned.
(b) Consumption of Raw Materials:
|;;::::;;:;:;v:;.::;:;;i'l;^
i' ' ; "i. :: ::: : ' :
635.10
10449.61
" :':". ]_;/-.-::'^\f-'--.:.\;i:^\:'.-:Vi^tB
;- ^&.. .: .- " ' ; '-; '. :..;::.:.; 2005^2006 ; ; i ;'. ..2004-2005 ; :
(a) Copper
MTs
3029
(b) Polyethylene
(c) Single Mode Optical Fibr.3
(d) Others
MTs
KMs
3633
238587
Total
37
2413
2687
97939
1153.64
567.55
::
CjliaOtity : ;';;- .j i ' - . - .
8660.87
15381.66
(d) Miscellaneous Sales*
; ;;!;: ." ", W--^'K: "Sii '^viS .^; :: '^M^. ttnjt 'V ; ' . :- '
v;;1
:2S04-2005
;2<}OS*2006
2B64^QQ5'
fetiii iaes
Rsiifiifaes
5660.11
4217.56
1973.73
1459.15
865.75
469.15
2529.90
1643.84
11029.49
7789.70
(c)
Value of imported and indigenous Raw Materials and Spare Parts Consumed and Percentage thereof:
205|-2005::::,|f;::;::.:V5
illplii;::^
iiillllllll:
(i)
Raw Materials :
Imported
Indigenous
Total
(ii) Spare Parts

Imported
Indigenous
62.40
37.60
452.32
7337.38
582
94 18
11029.49
100.00
7789.70
100.00
22.00
116.57
1588
84.12
138.57
100.00
28.11
139.42
Total
(d)
6882.12
4147.37
16.78
83.22
167.53
100.00
Stock of Finished Goods :
iiiiiiiiiiiiiiiiii
fmmmymmmm^âmmmmmmmîmmmms^mm 2005:-:::HH:::::;-::::::::::::::,.:::::
::
:
gjj ;:;^;;Gi3^tngi;Sf^|ii;:;^::S:;e:|.!iSing :^^ck:S:;:::^:i:;::;:::::;:Sp^:riing:iStec(t::;:::::5;::S:sStoB)rtg;stbck;;;:; .'.::-:
iiQjp ::|;|l:vatee: *;..
:;!;;!li^^
:-:::;:;-;;;i;t..:::S:J;f|SiiBJ;;;(gsS;;;;:;: ;::::;::.::::::::x:::::ftsi(M:;:laCS .
i:;;;;;;;;;!;!;;;^
(a)
Jelly Filled
Telephone
Cables
(b)
Fibre Ribbon
KMs
36
KMs
12
Total
15.
2828
8.30
2828
2610 8.29
0.65 192
13
8.30
Optical Fibre
Cables
(c)
CKMs
0.95
9.90
1.77 36
12
10.06
0.65
0.95
9.90
Figures of previous year have been shown in brackets and regrouped wherever necessary.
Signatures to Schedule 1 to 22
R.S.Lodha
J.Veeraraghavan
Chairman
"\
S.K.Misra
Partner
R.C.Tapuriah
D.R.Bansal
I
\ Directors
/
Per ANIL GUPTA
H.V.Lodha
PrachetaMajumdar
R.G.Mundra
Managing Director
GautamSharma
38
ADDITIONAL INFORMATION AS REQUIRED UNDER PART-IV OF SCHEDULE-VI TO THE COMPANIES ACT, 1956.
BALANCE SHEET ABS3TRACT AND COMPANY'S GENERAL BUSINESS PROFILE,
1.
Registration det ails
Registration No.
State Code
1_[o
Balance Sheet date
| 3 \1 |
| 0 \3
Date
II.
Year
Month
Rights Issue
Bonus Issue
Private Placement
I
Position of Mob lisation and Deployment of Funds (Amount in Rs. thousands)

Tola Liabilities
Total Assets
2
Sources of Funds
Paid-up Capital
8
Secured Loans
1
ei | 8
Investments
r- let Current Assets
Misc. Expend ture
A ccumulated Losses
Deferred Tax Assets (Net)

N
Performance of Company (Amount in Rs. thousands)

Furnover
tJnsecured Loans
Applicati on of Funds
r-Jet Fixed Assets
Reserves & Surplus

1
IV.
Capital raised during the year (Amount in Rs.thousands)

F ublic Issue
III.
Ci
C
!
Total Expenditure
rofit/Loss before Tax

9
Profit/Loss after Tax
E arning per Share before Extraordinary Item in Rs.

1
Dividend rate %
Earning per Share after Extraordinary Item in Rs.

1
V.
Generic names of Three Principal Products/Services of Company (as per monetary terms)
Item Code No.(ITC Code)
4|.
Product Description
Product Description
&
Product Description
0
I
R
&
F
0
39
E
I
T0
INFORMATION REGARDING SUBSIDIARY COMPANIES
Pursuant to the approval granted by the Central Government under Section 212(8) of the Companies Act, 1956 for the financial year ended
on 31st March, 2006, the required information relating to the subsidiary companies is as given below:
Rs. in lacs
;
AMgu$t:Ag^p;LtI;:J ;:pi^dÂg^;tid| iiTSiteiqSAgentS :ijf d;.SH !0^;!|ib^::G^::pa,;;;;
''^^mîiiiiiiîMMS
illH:!!$&$&
:
:
;
:;:{:SS;:x20Q6:
Capital
iiiiiHill
li^li!iiiisiii:l|:ilii;;
llMsiS-S'
:
WJi:0 :S9Q5 > ;.;J XY.20Q6S iv'iOjJSgQOS;: ??: 2006: i?s ::H;J2065;: : 'ig;::yS26o& ;.'SS'';-Sfi(:KlS:
;
804.00
804.00
3196.00
3196.00
1551.46
4000.00
4000.00
1551.46
4000.00
4000.00
6004080
1495.84
6004080
1495.84
1525.02
1525.02
1500.02
1500.02
1500.02
144.40
52.79
146.48
52,52
142.07
Total Assets
1669.42
1577.81
1646.50
1552.54
1642.09
Total Liabilities
1669.42
1577.81
1646.50
1552.54
1642.09
Investments (Quoted)
Equity Shares of 107- each of
No. of Shares
Value
6015912
1518.51
6015912
1518.51
5994680
1492.56
5994680
1492.56
. 186737.88
20.00
-
Reserves
1500.02
51.44
Investments (Unquoted)
Units of Rs.107- each in Mutual Fund:
JM Floater Fund - Short Term Plan
No. of Units
Value
JM Fixed Maturity Fund - Yearly Growth

No. of Units
215118.30
Value
21.51
Prudential ICICI Monthly Income

Plan - Cum.
No. of Units
Value
.
-
.
-
57681.23
8.57
67338.71
10.00
Prudential ICICI Liquid Plan

No. of Units
Value
149943.92
25.00
Reliance Floating Rate Fund

No. of Units
Value
288542.86 288542.86
29.00
29.00
- 432460.40 451833.30
43.46
45.41
Reliance MIP - Growth

No. of Units
Value
294702.10
35.00
Deutsche Fixed Term Fund

Series 9-Growth
No. of Units
Value
308694.74
30,87
451059.99
HDFC Floating Rate Income Fund-ST-G

No. of Units
Value
Birla Income Plus Plan B-Growth

No. of Units
Value
Templeton India MIP Growth
No. of Units
Value
Franklin Templeton Fixed Tenure
Fund Series V-13-Growth
No. of Units
Value
49.00
748.48
0.17
2509.55
0.58
59462.17
9.57
62166.25
10.00
- 256520.11
25.65
- 530013.53
53.00
-
307750.59
30.77
HDFC FMP-13M Retail Growth Plan

No. of Units
Value
HSBC Fixed Term Series 8 - Growth

No. of Units
Value
40
'
62166.24
10.00
62166.24
10.00
.
-
INFORMATION REGARDING SUBSIDIARY COMPANIES (Contd.)
Rs. in lacs
liiiiiiiiiiil!itjtjsiibiiiiaiiis
;p|Siii:ii!iiiis:iii ;lipiîi^;;li;
ijjjj Illilli
mimm
Prudential Income Multiplier Regular Plan
No. of Units
Value
:::. :-:-:-:-XiH;j:î::::: : : : xi3-:r?>J
iilli
l
i
l
l
i
l
i
i
IB
.-
ll|||g|l;
289555.33
35.00
Value
.
-
HDFC MIP Long Term - Growth

No. of Units
Value
UTI Fixed Maturity Plan - Dividend

No. of Units
Value
Income/Turnover
92.72
60.36
95.51
60.02
91.82
60.09
657.65
272.63
ProfiV(Loss) before Taxation
91.91
59.43
94.67
59.11
90.93
59.02
(100.54)
(94.28)
.
-
256126.06
25.61
243025.18
30.00
360590.26
36.06
Franklin Templeton Fixed Term

Fund - 5 - Growth
No. of Units
Provision for Taxation
Profity(Loss) after Taxation

Proposed Dividend
0.30
59.43
91.61
0.70
93.97
59.11
.l.S.Lodha
0.30
0.85
90.63
59.02
(101.39)
(94.28)
Chairman
J.Veeraraghavan
S.K.Misra
R.C.Tapuriah
D.R.Bansai
Directors
H.V.Lodha
Pracheta Majumdar
R.G.Mundra
Managing Director
Gautam Sharma
Finance Manager S Assistant Secretary
41
Auditor's Report
TELELINKS LIMITED, ITS SUBSIDIARIES AND JOINT VENTURES
We have audited the attached Consolidated Balance Sheet of Vindhya Telelinks Limited, its Subsidiaries and Joint Ventures (Vindhya
Telelinks Group) as at March 31,2006 and also the Consolidated Profit and Loss Account and the Consolidated Cash Flow Statement for the
year ended on that date annexed thereto. The consolidated financial statements are the responsibility of Vindhya Telelinks Limited's
management and have been prepared by the management on the basts of separate financial statements and other financial information
regarding its subsidiaries and joint ventures. Our responsibility is to express an opinion on the consolidated financial statements based on
our audit.
We conducted our audit in accordance with the 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.
We did not audit the financial statements of all subsidiaries of Vindhya Telelinks Limited whose financial statements reflect total assets of
Rs. 8434.63 lacs as at March 31, 2006 and total revenues of Rs.578.56 lacs for the year then ended. We also did not audit the financial
statements of Joint Ventures of Vindhya Telelinks Limited out of which total assets of Rs. 1535.38 lacs as at March 31, 2006 and total
revenue of Rs. 1222.02 lacs for the year have been considered for the purpose of preparation of these Consolidated Financial Statements.
The financial statements and other financial information of the above subsidiaries and joint ventures have been audited by other auditors
whose reports have been furnished to us, and our opinion, is based solely on the report of the other auditors.
Read withJMote No 1 (vi) in Schedule 27, we report that the consolidated financial statements have been prepared by the Company in
accordance with the requirements of the Accounting Standard (AS) 21 Consolidated Financial Statements and AS 27 Financial Reporting of
Interest in Joint Ventures issued by the Institute of Chartered Accountants of India.
Based on our audit and on the consideration of reports of other auditors on separate financial statements and on the other financial
information of the subsidiaries and joint ventures, and to the best of our information and according to the explanations given to us, we are
of the opinion that the attached consolidated financial statements give a true and fair view in conformity with the accounting principles
generally accepted in India:
(a)
in the case of the Consolidated Balance Sheet of the consolidated state of affairs of the Vindhya Telelinks Group as"at March 31, 2006;
(b)
in the case of the Consolidated Profit and Loss Account, of the Profit of the Vindhya Telelinks Group for the year ended on that date;
and
(c)
in the case of the Consolidated Cash Flow Statement, of the cash flows of the Vindhya Telelinks Group for the year ended on that date.
For S.R.BATL'BOI & CO.
Per ANIL GUPTA

PARTNER
Place: New Delhi

42
CONSOLIDATED BALANCE SHEET AND PROFIT AND LOSS ACCOUNT

CONSOLIDATED BALANCE SHEET AS AT 31ST MARCH, 2006
iliiiiiiiiliîiiisîiiiiisststMiffih
m^mmmmm^^m^^mm^ MM:M^
i
l
i
^
i
i
l
i
l
i
lllllllllllliipililllli;!;iîii;tB;;JJ6SS
y}mmmmmzm
SOURCES OF FUNDS
SHAREHOLDERS' FUNDS
Share Capital
Reserves and Surplus
1182.09
20991.08
22173.17
1181.32
20615.15
21796.47
324.29
1041.98
1366.27
324.29
1082.87
1407.16
1546.92
2516.01
4062.93
2005.18
2850.68
4855.86
57.66
121.14
27660.03
28180.63
18130.82
10681.89
7448.93
56.81
7505.74
18008.06
10072.53
7935.53
9264.72
9253.94
8
9
10
11
12
2679.22
3231.83
3914.09
64.93
1975.29
11865.36
1956.91
1717.19
4255.94
230.99
3492.21
11653.24
13
14
758.34
217.45
975.79
450.56
212.60
663.16
10889.57
10990.08
1.08
27660.03
28180.63
MINORITY INTEREST
Equity
Non Equity
LOAN FUNDS
Secured Loans
Unsecured Loans
4
5
DEFERRED TAX LIABILITIES (NET)
Total
APPLICATION OF FUNDS
FIXED ASSETS
Gross block
Less: depreciation
Net block
Capital work-in-progress
INVESTMENTS
7935.53
CURRENT ASSETS, LOANS AND ADVANCES
Inventories
Sundry debtors
Cash and bank balances ,
Other current assets
Loans and advances
LESS: CURRENT LIABILITIES AND PROVISIONS
Current liabilities
Provisions
NET CURRENT ASSETS
MISCELLANEOUS EXPENDITURE (to the extent not written off)
15
Total
27
The schedules referred to above and notes to the accounts form an integral part of the E alance Sheet.
R.S.Lodha
J.Veeraraghavan
PerANILQUPTA
Partner
Membership No.87921
Chairman
S.K.Misra
R.C.Tapuriah
D.R.Bansal
\ Directors
H.V.Lodha
Pracheta Majumdar
H.G.Mundra
Managing Director
Gautam Sharma

43
CONSOLIDATED PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31ST MARCH, 2006
iiiiiiiiii
iiiiiiiiîi^mi liiiBit
:::::;:- ;':':':;:::::::: ::: ':': ' pjj f : ~J fi i6':V <fid f":: ' ' ': "::::: ':':':':-:': ':'-: ': ': ' : '- : ' :; :: :: ; '& ncfGCj-' 33 5t ' ''^
INCOME
Turnover (Gross)
Less:- Excise duty
Turnover (Net)
16
Other income
17
17071.33
2390.71
14680.62
1044.83
11424.64
1520.13
9904.51
1517.76
15725.45
11422.27
12045.46
11.60
690.02
2152.72
(355.24)
150.24
8382.43
200.60
601.53
1582.73
(191.29)
86.84
14694.80
10662.84
1030.65
706.66
759,43
604.20
323.99
155.23
7.08
49.32
EXPENDITURE
Raw materials consumed

Cost of traded goods sold
Personnel expenses
Operating and other expenses
(Increase) in inventories
Financial expenses
18
19
20
21
22
23
PROFIT BEFORE DEPRECIATION, EXCEPTIONAL ITEM,

PRIOR PERIOD ITEMS AND TAX
Depreciation
24
PROFIT BEFORE EXCEPTIONAL ITEM, PRIOR PERIOD ITEMS AND TAX

Prior period items (Refer Note No. 10 of Schedule 27)
25
32.09
PROFIT BEFORE TAX
Income tax
Fringe benefit tax
Total tax (Income)
26
NET PROFIT BEFORE MINORITY INTEREST
Minority interest
NET PROFIT FOR THE YEAR

Transferred to Reserve Fund (Under RBI Act, 1934)
Surplus carried to Balance Sheet
Earnings per share (EPS)
Weighted average number of equity shares in calculating basic and diluted EPS
Basic and diluted (Nominal value of shares Rs.10/- each (Rs. 10/- each))
Notes to the Accounts
291.90
(58.70)
16.72
(41.98)
98.83
(35.92)
333.88
(40.89)
134.75
(38.02)
374.77
137.25
55.24
456.78
172.77
11850863
3.16
(35.92)
35.52
137.25
11850863
1.46
27
The schedules referred to above and notes to the accounts form an integral part of the Profit and Loss Account.
R.S.Lodha
J.Veeraraghavan
Per ANIL GUPTA
S.K.Misra
Partner
R.C.Tapuriah
D.R.Bansal
Chairman
\ Directors
H.V.Lodha
Pracheta Majumdar
R.G.Mundra
Managing Director
Gautam Sharma
44
CONSOLIDATED CASH FLOW STATEMENT FOR THE YEAR ENDED 31 ST MARCH, 2006
A Cash flow from operating activities

Net Profit before tax
291.90
98.83
Adjustments for :
Depreciation
706.66
Preliminary expenses
604.20
1.08
Loss on disposal of fixed assets (Net)
1.08
5.06
(Profit) on sale of current investments
7.68
(45.18)
(4.29)
Provision for diminution in the value of current investments written back
51.33
(27.12)
Interest income
(343.15)
(560.75)
Dividend income
(404.77)
(326.44)
Interest expense
71.50 (35.92)
58.01 (169.18)
255.98
(70.35)
Operating Profit/(Loss) before working capital changes

Movement in Working Capital:
Decrease/(lncrease) in sundry debtors
(1514.64)
249.66
Decrease/(lncrease) in inventories
(722.31)
911.04
Decrease/(lncrease) in loans and advances
(132.12)
51.17
Increase in current liabilities and provisions
302.02
Net Cash (used in)/generated from operations :

Direct taxes refund received
Net cash (used in)/from operating activities
(2067.05)
106.37
1318.24
(1811.07)
1247.89
80.89
225.78
(1730.18)
1473.67
B. Cash flow from investing activities

Purchase of fixed assets
(356.74)
Proceeds from sale of fixed assets
(300.45)
72.75
Purchase of investments
27.15
(1093.99)
(1170.32)
Sale of investments
1155.51
590.68
Deposits with bodies corporate & others
1546.65
536.67
Interest received
509.21
713.99
Dividend received
404.77
326.44
Net cash generated from investing activities
2238.16
45
724.16
isll&g^
^:::::::::::::::::^x>>""x:v'::::::::::::::::::;:;x::::::::::-
x;:;:;:;x;:;:;x;:;>x;:;:o:;^:;:;:;:;:;:;:;:;:;:;:;:;:;:;:;x
\mmsmmmm
MiiiîmMSm
'3!f^8^m^X$iiiii!$$ii$i$^M Ss?SS \mmmmmmt

illlllllllllll^^
^lilltis||i!||:;iis|ffi||ies
iiiglSiiljijiiiS^
CONSOLIDATED CASH FLOW STATEMENT FOR THE YEAR ENDED 31 ST MARCH, 2006 (Contd.)
C. Cash flow from financing activities
Proceeds from share capital
0.77
Proceeds from share premium
3.22
Repayment of short term borrowings
(453.83)
(376.96)
Repayment of long term borrowings
(335.37)
(3162.49)
Interest paid
(61.25)
(54.28)
Dividend paid
(3.37)
(2.38)
Net cash (used in) financing activities
(849.83)
(3596.11)
Net (decrease) in cash and cash equivalents
(341.85)
(1398.28)
Cash and cash equivalents at the beginning of the year
4255.94
5654.22
Cash and cash equivalents at the end of the year
"3914.09
4255~94
173.56
177.15
Components of cash and cash equivalents as at 31st March

Cash and cheques on hand
With scheduled banks
- on current accounts
494.26
57.49
- on deposits accounts
3204.59
3875.31
- Cash credit accounts
23.82
124.76
- Unclaimed dividend accounts
17.86
21.23
3914.09
4255.94
Notes :
(a)
The Cash Flow Statement has been prepared under the 'Indirect method' as set out in Accounting Standard-3 on Cash
Flow Statements issued by the Institute of Chartered Accountants of India.
(b)
Negative figures have been shown in brackets.
For S.R.BATLIBOI & CO
R.S.Lodha
J.Veeraraghavan
Per ANIL QUPTA
S.K.Misra
Partner
Membership No.87921
D.R.Bansal
R.CTapuriah
Chairman
, Directors
H.V.Lodha
Pracheta Majumdar
New Delhi, April 29. 2006
R.Q.Mundra
Managing Director
GautamSharma
46
SCHEDULES ANNEXED TO AND FORMING PART OFCONSOLIDATED BALANCE SHEET AS AT 31ST MARCH, 2006 AND CONSOLIDATED
PROFIT & LOSS ACCOUNT FOR THE YEAR ENDED ON THAT DATE
SCHEDULE 1 : SHARE CAPITAL
Authorised
1,50,00,000
1500.00
1500.00
1500.00
1500.00
1185.20
1185.20
1185.20
1185.20
1185.09
1185.09
1185.09
1185.09
3.00
3.77
3.77
1182.09
1182.09
1181.32
1181.32
0.03
0.03
0.03
0.03
9.27
Issued
1,18,52,014
Subscribed
1,18,50,863
Less:
Calls unpaid
fully paid up
3.00
Total
SCHEDULE 2 : RESERVES AND SURPLUS
Capital Reserve
Difference between the cost of the investment in
the Subsidiaries and Company's portion in equity
of the subsidiaries at the time of acquisition
On revaluation of plant & machinery
9.27
11.59
11.59
Less: Adjustment in respect of disposal of fixed assets 0.01
0.01
0.10
0.10
Less: Transferred to Profit and Loss Account being

difference of depreciation on revalued cost of
assets and that on the original cost
2.05
2.05
2.22
2.22
7.21
7.21
9.27
9.27
Securities Premium Account

3873.63
Add : Received during the year
184.34
3876.85
4057.97,
3873.63
184.34
4057.97
3873.63
184.34
4057.97
3.22
3.22
184.34
4061.19
Reserve Fund (Under the Reserve Bank

of India Act, 1934)
35.52
35.52
Add: Created during the year
55.24
55.24
35.52
35.52
90.76
.76
35.52
35.52
16375.11
16170.44
204.67
16375.11
456.78
113.69
23.56
137.25
20991.08
20202.58
412.57
20615.15
General Reserve
16170.44
Profit and Loss Account
375.64
Total
20520.93
204.67
81.14
470.15
47
As at 31st March 2006
||^^
SCHEDULE 3: MINORITY INTEREST
a)
Minority interest in equity of Optic

Fibre Goa Ltd 32425235 (3242535)
Equity share of Rs. 10A each (40.33%
b)
324.29
324.29
324.29
324.29
Minority interest in non equity of

Optic Fibre Goa Ltd
Share premium
1289.09
1289.09
1289.09
1289.09
Less: Accumulated loss

Less: Share in the loss of the current year
(206.22)
(206.22)
(168.20)
(168.20)
(40.89)
(40.89)
(38.02)
(38.02)
1366.27
1366.27
1407.16
1407.16
31.73
31.73
Total
SCHEDULE 4 : SECURED LOANS
Loans from Banks

Cash credit facilities
Foreign currency working capital loan
12.63
5.23
17.86
573.59
53.91
627.50
Loans against fixed deposit receipts

Interest accrued and due
Sales Tax Loans
Total
1067.46
3.73
1067.46
3.73
755.25
146.31
901.56
755.95
146.31
902.26
1341.47
205.45
1546.92
1858.87
146.31
2005.18
Notes:
1. Repayment of sales tax loans, loans from Bank against fixed deposit receipts due within next twelve months Rs.548.50 lacs
(Rs.1118.25 lacs) including Rs.50.79 lacs (Rs 50.79 lacs) of joint venture.
2. Cash credit borrowings including foreign currency loan (covered by forward exchange contracts) (fund and non fund based) from SBI
are secured by hypothecation of the Company's entire goods, movable and other assets, present and future, including documents of title
to goods and other assets such as book-debts, outstanding moneys, receivables, claims, bills, invoices, documents, contracts,
engagements, securities, investments and rights and all machinery, present and future and further secured by deposit of all title deeds
of the existing immovable properties of the Company as and by way of collateral security and are further secured by way of pledge of
12,50,000 equity shares of Birla Ericsson Optical Limited held as investment by the Parent Company.
3. Loans from Banks against fixed deposit receipts are secured by way of pledge of fixed deposit receipts of Rs. 150.00 lacs
(Rs. 1680.00 lacs).
4. Sales tax loans are as per Scheme of State Government and for administration of these loans, Madhya Pradesh State Industrial
Development Corporation Limited (MPSIDC) has been nominated by the State Government.
5. Sales tax loans from MPSIDC are secured by way of hypothecation of Company's all movable plant and machinery, spares, tools and
accessories and other movable assets, both present and future, ranking subsequent and subservient to all charge(s) created/to be
created in favour of SBI and are further secured or to be secured by way of joint mortgage (on residual charge basis) created/to be
created by deposit of title deeds of all immovable properties of the Company.
SCHEDULE 5 : UNSECURED LOANS
Sales Tax Loans

(Refer Note No. 4 of Schedule 4)
2207.29
308.72
(Due within next twelve months Rs.1257.55 lacs (Rs. Nil))
48
2516.01
2509.78
340.90,
2850.68
V1NDHYA TELELINKS LIMITED

SCHEDULE 6 : FIXED ASSETS
(Company and Its Subsidiaries)
Rs. in lacs
.NatuKotxx-.xixx xx.;;- : : : : ::x :;:;x xx :"x x; x ;::: :x; GfSsS:B:lockx:: : : x ; x; ,::.:. ; s xx . : : x x : : : : .:: ,: ..:,; DepreciattoM : : : : -ff .<.. .;: ' :??' :;: : : v s; Net:B(OeKx ss .j; :
';:::::x::xftsat:::xx:ft:i:lditiQ05x:x::'::D8cfiaiQfis:' ':x::;x:Mgtx ".'- xUptCix xPfted x:X SSJuctfeSstx
:;As:alx ^':':;:H$SSt
Up!9:
: xlSiSOOSx : aarttwflie::xx /Adjustments .: ::ap:2006: : ;:- -f -If.. :xduringitie::::::xAcffuatjSetifs;. 31 :3 2S06 ;v 31 .3.2006.:::::;;;: 31:3.2005::
x. : . Veafx : y .
:
::
LAND
Free hold
Lease Hold
103.19
191.01
BUILDINGS
2465.75
PLANT & MACHINERY

FURNITURE & OFFICE
EQUIPMENT
VEHICLES
0.94
13620.05
200.87
248.97
26.84
88.42
TOTAL.
103.19
19101
16717.39
25.71
5.51
2459.94
855.96
64.96
104.20 13716.72
810243
557.94
6.75
5.27
270.54
153.37
17.48 40.01
65.89
5722
156.23
16807.29
9194.69
246.13
15.45
3.28
647.14
31 .22
103.19
159.79
103.19
165.30
920.92
1539.02
1609.79
56.38
8603.99
5112.73
5517,62
3.21
165.61
104.93
95.60
23.07
37.43
28.46
82.66
9759.17
7048.12
7522.70
56.81
7104.93
7522.70
CAPITAL WORK-IN PROGRESS

PREVIOUS YEAR
31.20
208.60 9194,69 7522.70

Notes: 1) Additions to Buildings and Plant & Machinery during the year include Rs. Nil (Rs.0.47 lac) and Rs.Nil (Rs 2.27 lacs) on account
of foreign exchange fluctuation respectively
2) Freehold Land includes Rs.5.47 lacs (Rs.5.47 lacs) given on lease.
3) Fixed assets of the value of Rs.25.59 lacs (WDV of Rs.0.64 lac) in case of the parent company have been discarded during
the year.
4) Plant & Machinery include Rs.905.70 lacs (Rs. 906.63 lacs) on accountof addition on revaluation during the year ended March
31,1990 as per valuation of parent company carried out by approved valuer.
(Companys1 proportionate share in Joint Venture)
Rs in lacs
16683.37
276.08
Nature of ':<?$} : ', : .-;:.;:::;:i-;;:::S;:;:;;:;;;:;?;^.^^
242.06
16717.39
8858.17
545 12
:: ; '^'SfK: ?; ! ';:S:!;: i;:;iii;:ili!;|;;s.;:: ::;J;::;;:;j;;;:^r^Wft|i::;;i;:;;: : ~&i?:iffil. x xSS ^NetBfeefcssSxx i:
riftoa.a^sSs^.:;1^:::^:;^;^
LAND
LEASE HOLD
BUILDINGS
PLANT & MACHINERY
3.25
133.35
1142.31
53.38
3.25
-
19.28
0.05
0.67
36.21
3.73
39.94
1176.41
834.44
57.10
FURNITURE & OFFICE

EQUIPMENT
7.09
VEHICLES
4.67
TOTAL
1290.67
53.80
20.94
1323.53
PREVIOUS YEAR
1275.75
24.37
9.45
1290.67
0.42
2.58
0,62
133.35
15.72
875.82
93.41
300.59
0.27
7.24
4.24
0.36
0.19
4.41
2.83
1.39
3.28
2.33
0.33
0.78
1.88
1,40
877.84
61.57
16.69
922.72
400.81
824.52
61.30
7.98
877.84
412.83
2.63
97 14
307.87
2.85
2.34
412.83
Note:
Additions to Plant & Machinery during the year include Rs.0.03 lac (Rs.Nil) on account of foreign exchange fluctuation.
(Consolidated)
Rs in lacs
. j\ia(uig:df. : , > :;: x. x : , : : : :, .;:. .::... .: ::.:'x :: ::'::;xx :,x.x sjro^s: B)ijcJCx;x: ^ ' ' x;: ..;; .::;.;::::K:S:V ::-: H::';:;:x: : : ^^^fiyfyfir&fefon^M'---^
x :: ;. '. ' v::':''- :
: : > : :'S:.: f .t:J(fe5 ?x:tkiring ths :xr Adjustmenfe:x:ii::,<5: JJ306 : x
103.19
103.19
Lease Hold
194.26
194.26
2593.29
892.17
5.56
68.59
0.94
6.75
26.33
103.19
103.19
162.37
960.86 1632.43
9479.81 5413.32
1706.93
5825.49
31.89
254.25
123.48
14893.13
8936.87
615.04
27.26
5.54
41.40
177.17
277.78
69.17
15761
15.81
3.40
170.02
59.55
3.61
23.85
39.31
18130.82
10072.53
708.71
99.35
10681.89
17.48
299.93
PREVIOUS YEAH
Notes:
--' xx:: :: : ::x(i|et Btock^:::x::x: 'S;
:3i::g,23o5 /dffiihgtte '.: AdjBstaeflls::: : 3S3:8iiS5:::: Sl^SiStHSxXijjfSijSgOoSxx
LAND
Free Hold
BUILDINGS
2599.10
PLANT & MACHINERY 14762.36
FURNITURE & OFFICE
25606
EQUIPMENT
VEHICLES
93.09
TOTAL
18008.06
CAPITAL WORK-IN PROGRESS
'
72.10
107.76
29.86
7448.93
56.81
7505.74
167.93
98.45
33.54
7935.53
.
7935.53
17959.12
300.45
251.51 18008.06
9682.69
606.42
216.58 10072.53 7935.53
1) Additions to Buildings and Plant & Machinery during the year include Rs. Nil (Rs.0.47 lac) and Hs.0.03 lac (Rs 2.27 lacs) on
account of foreign exchange fluctuation respectively
2-\ Freehold land includes Rs.5.47 lacs (Rs 5.47 lacs) given on lease.
3) Eixed Assets of the value of Rs.25.59 lacs (WDV of Rs.0.64 lac) in case of the parent company have been discarded
during the year.
4) Plant & Machinery include Rs.905.70 lacs (Rs.906.63 lacs) on account of addition on revaluation duiing the year ended
March 31. 1990 as per valuation of parent company carried out by approved valuer.
__
___
49
; ;:8Sii5;.
SCHEDULE 7: INVESTMENTS
Long Term Investments
(A) Trade
Quoted - Fully paid up equity shares of Rs. 10/- each
31,42,285
(31,42,285) Universal Cables Ltd.
2,43,94,948
(2,43,94,948)
994.75
6424.49
Unquoted - Fully paid up equity shares of Rs. 107- each

2,99,940
(2,99,940) Birla Financial Corporation Ltd.
(46,00,000) Universal-ABB Power Cables Ltd.
I,20,00,000 (1,20,00,000) Punjab Produce Holdings Ltd.
0.67
0.01
29.99
(11,106)
Universal Telelinks Ltd.
11,106
(11.106)
Universal INP (USSR) Electricals Ltd. 0.98
994.75
6424.49
29.99
1200.00
1200.00
II,106
995.42
6424.50
0.980.13
0.13
0.67
0.01
29.99
460.00'
1200.00
995.42
6424.50
29.99
460.00*
1200.00
1.11 0.980,13
1.11 0.980.13
1.11
0.02
0.02
0.02
8.57
10.00
10.00
72.46
74.41
74.41
19.56
20.00
20.00
0.17
0.58
0.58
1.11
(B) Other than trade

Unquoted-Fully paid up equity shares of Re.t/- each
6,900
(6,900)
Free Press House Ltd.
0.02
Current Investments-Trade
Unquoted - Fully paid up units of Mutual Funds of Rs.10/- each
57,681
(67,339) Prudential ICICI MIP-Cumulative
8.57
(NAV as on 31.03.06-Rs. 10.23 lacs)
7,21,003
(7,40,382) Reliance Floating Rate Fund
72.46
(NAV as on 31.03.06-Rs. 78.41 lacs)
1,21,628
(1,24,332) Templeton MIP - Growth of Franklin
Templeton Mutual Fund
19.56
(NAV as on 31.03.06-Rs. 22.65 lacs)
748
(2,510) Birla Income Plus Plan B-Qrowth
0.17
(NAV as on 31.03.06-Rs. 0.22 lac)
66,650
(66,650) Reliance Equity Opportunities FundDividend Plan
6.66
(NAV as on 31.03.06-Rs. 12.30 lacs)
66,650
(-)
SBI Mutual Fund Magnum

Multicap Fund- Dividend
(NAV
1,63,457
1,67,096
(-)
(-)
6.67
6.66
6.67
as on 31.03.06 - Rs. 9.30 lacs)
TINFD Tata Infrastructure

Fund-Dividend
(NAV as on 31.03.06-Rs. 31.50 lacs)
fata Service Industry Fund-Dividend
25.00
25.00
25.00
25.00
(NAV as on 31.03.06-Rs. 28.46 lacs)
5,66,650
(-)
ING Vysya Mutual Fund - Lion Fund Dividend Option

(NAV as on 31.03.06-Rs. 63.18 lacs)
2,15,118
(-)
50.00
(-)
1,49,944
()
2,94,702
(-)
56.67
JM Fixed Maturity Fund-Yearly

Growth of JM Mutual Fund
(NAV as on 31.03.06-Rs. 22.23 lacs)
3,08,695
6.67
Deutsche Fixed Term Fund

Series-9 Growth
21.51
21.51
30.87
30.87
(NAV as on 31.03.06-Rs. 30 95 lacs)

Prudential ICICI Liquid Plan
25.00
(NAV as on 31.03.06-Rs. 25.00 lacs)
Reliance Monthly Income Plan-Growth 35.00
25.00
35.00
(NAV as on 31.03.06-Rs. 37.14 lacs)
2,43,025
(-)
HDFC MF Monthly Income Plan

Long Term - Growth
30.00
30.00
Franklin Templeton Fixed

Term Fund-5 Growth
(NAV as on 31.03.06-Rs. 25.68 lacs)
25.61
25.61
(-)
UTI Fixed Maturity Plan- Dividend
36.06
36.06
(-)
(NAV as on 31.03.06-Rs. 36.11 lacs)

HDFC FMP 13 M-Retail Growth Plan
53.00
53.00
30.78
30.78
35.00
35.00
(NAV as on 31.03.06-Rs. 33.01 lacs)
2,56,126
3,60,590
5,30,013
(-)
(NAV
3,07,751
(-)
HSBC Fixed Term Series 8-Growth

(NAV
2,89,555
(-)
as on 31.03.06-Rs. 53.00 lacs)

as on 31.03.06-Rs.30.84 lacs)
Prudential ICICI Income Multiplier
Regular-Growth
(NAV as on 31.03.06-Rs. 37.89 lacs)
50
6.66
6.66
: As >rt 31 >st iMareh:

. -QoffipAny
iia'riailsi
SCHEDULE 7: INVESTMENTS (Contd.)

2,56,520
Franklin Templeton Fixed Tenure
Fund-Series V-3 MIP- Growth
25.65
(NAV as on 31.03.06-Rs. 27.12 lacs)
66,650
Grindlays Fixed Maturity Plan-l-A-Growth
25.65
6.67
6.67
36.66
36.66
(NAV as on 31.03.06-Rs. 6.85 lacs)
2,33,461
(14,08,598)
(6,90,657)
(1,86,738)
(4,51,060)
(3,71,731)
(33,325)
(66,650)
(1,01,687)
(89,618)
(245,072)

Insta Cash Fund-cash option
(NAV as on 31.03.06-Rs. 36.69 lacs)
SBI Mutual Fund SBI Magnum Sector
Funds Umbrella Pharma *
Franklin Templeton India Ltd. FT India
Monthly Income Plan Monthly
Dividend - Reinvestment
JM Floater Fund Short term plan of
JM Mutual Fund
HDFC Floating Rate Income FundST-Growth
Birla Sun Life Mutual Fund Birla MIP
Plan - Reinvestment Monthly
273.10
288.30
77.88
7788
20.00
20.00
49.00
49.00
Dividend-Reinvestment
38.98
38.98
Reliance Pharma Fund

Franklin India Flexi Cap Fund (Dividend) *
HDFC Liquid Fund-Growth
HSBC Cash Fund-Growth
3.33
6.66
13.33
10.00
3.33
6.66
13.33
10.00
Sector Fund Umbrella (Contra)

'Less: Provision for Diminution in the value of Investments
Total
Aggregate amount of quoted investments
33.99
33.99
9264.72
9636.18
129.09
9765.27
64.27
0.68
9264.72
7419.92
81693.58
1844.80
507.07
9129.11
7419.24
4.26
124.83
0.68
2216.94
128.41
511.33
9253.94
7419.92
15548.62
2345.35
9200.45
-
64.27
9200.45
7419.24
1781.21
63.59
Market value of quoted investments

Aggregate amount of unquoted investments
Note :
15.20
3,845 units of Franklyn Templeton India Ltd.- FT India Monthly Income Plan - Monthly Dividend -Reinvestment, 22,50,092 units
of HDFC Liquid Fund: Daily Dividend (including 275038 units of joint venture), 5,00,000 units of SBI Magnum Multicap Fund:
Dividend in the parent company and 1,722 units of Birla MIP Plan A: Monthly Dividend Reinvestment, 2,71,863 units of HDFC
Liquid Fund, 7,61,056 units of SBI Magnum Insta Cash Fund-Cash Option, 35,250 units of SBI Magnum Sector Funds Umbrella
(Contra), 13,437 units of Franklin Pharma Fund-Dividend, 17,819 units of Tata Service Industries Fund-Dividend and 17,431
units of Tata Infrastructure Fund-Dividend of the joint venture were purchased and sold during the year.
SCHEDULE 8 : INVENTORIES
Raw materials
Stores and spares
Traded goods
Work- in- progress
Finished goods
Scrap
Total
955.95
90.86
385.23
16.18
1064.05
-
33.30
9.09
82.13
-
39.46
2.97
1046.81
418.53
25.27
1146.18
42.43
2460.87
218.35
2679.22
627.57
477.37
18.60
784.73
9.90
10.17
60.59
3295
0.18
27.15
0.91
0.51
1834.62
122.29
1956.91
566.98
444.42
1842
811.88
10.81
10.68
SCHEDULE 9 : SUNDRY DEBTORS (UNSECURED)
For sales on deferred payment terms

Considered doubtful
For other sales
Considered doubtful
Other debts
Considered good
Considered doubtful
Less: Provision for doubtful debts
Total
3.27
31.66
41.03
31.17
2.88
290.72
123.59
133.33
100.47
2799.84
3.82
3250.02
138.00
159.07
3090.95
___:
140.88
2937.84
3.82
3390.90
159.07
3231.83
1396.25
_11.14
1713.39
142.78
1570.61
3.27
31.66
287.84
123.59
51
140.88
41.03
31.17
1.87
14471
146.58
146.58
135.20
100.47
1540.96
11.14
' 1859.97
142.73
"1717.19
VINDHYA TEL.ELINKS LIMITED
:iotal :
? Joint:*
its
subsidiaries
::R;i;:ihi:ii(iS:!:
SCHEDULE 10: CASH AND BANK BALANCES

Cash on hand (including cheques/drafts in hand Rs.166.75
lacs (Rs.170.46 lacs) (including Rs.85.06 lacs (Rs. 16.71 lacs)
of joint venture)
Balance with scheduled banks
On
current/collection accounts
159.85
87.80
85.76
173.56
481.24
13.02
494.26
53.88
23.82
122.92
361
1.84
124.76
3204.59
3567.06
308.25
3875.31
cash credit accounts
23.82
17.30
177.15
57.49
fixed deposit accounts (Including fixed deposit

receipts of Rs.1361.11 lacs (Rs.3098.43 lacs)
(Including Rs.131.11 lacs (Rs 163.43 lacs) of Joint
Venture pledged with banks)).
2875.18
unclaimed dividend accounts (including fixed deposits

of Rs.7.33 lacs(Rs.7.39 lacs) (including Rs.3.83 lacs
(Rs 3.89 lacs) of Joint Venture))
Total
13.96
329.41
3.90
17.86 17.28 3,95 21.23
_____
3482.00
432.09
61.55
9.47
60.93
SCHEDULE 11: OTHER CURRENT ASSETS

Interest Receivable on deposits and others
3914.09
3920.99
334.95
4255.94
3.38
64.93
215.71
15.28
230.99
0.37
9.84
63.74
9.35
73.43
0.24
3.37
9.59
76.80
1196.66
59.77
582.68
11.45
51.15
2650.00
51.54
93.31
4.57
3.65
0.20
2.68
2743.31
56.11
433.99
16.31
16.31
1991.60
3400.50
16.31 16.31
Toffo!
___-
3508.52
_16.31
1975.29
T08.02
3492.21
SCHEDULE 12 : LOANS AND ADVANCES (UNSECURED)
Considered good
Loans to employees

Deposits
-Inter-corporate
1150.00
5460
553.35
12 14
4639
-Others
Balance with custom, excise etc
Advance payment against tax less provision

Claims, Refunds etc. receivable
Considered doubtful :
Less: Provision
Total
2.81
46.66
5.17
29.33
(0.69)
4.76
16.31
190319
1631
88.41
188688
88.41
430.34
113.64
55.89
3384.19
113.84
58.57
16.31
Included in Loans and advances are:

Due from an officer of the Company Rs.0.82 lac (Rs. 0.38 lac) including Rs.Nil (Hs. Nil) of a joint venture. Maximum balance outstanding
at any time during the year Rs.0.99.lac (Rs. 0.47 lac) including Rs. Nil (Rs.Nil) of a joint venture.
Due from Universal Cables Ltd., a company under the same management of a joint venture Rs.33.33 lacs (Rs.93.31 lacs). Maximum
balance outstanding at any time during the year Rs.119.97 lacs (Rs. 115.97) of a joint venture.
SCHEDULE 13: CURRENT LIABILITIES
64.06
Acceptances
Sundry creditors
Advance from customers
Interest accrued but not due
565.52
73.20
23,72
12.85
1.13
64.06
638.72
380.13
23.72
12.32
13.98
3688
417.01
12.32
Investor Education and Protection Fund shall be credited by the
following amount on due date:

Unclaimed dividend
Total
13.96
3.90
680.11
78723
17.86
~758l?4
17.28
409.73
3.95
21.23
~40.83
450.56
Included in acceptances and sundry creditors are.
Payable to overseas creditors not covered by forward

exchange contracts
64.06
64.06
Payable to overseas creditors covered by forward

exchange contracts
62.85
62.85
Due to small scale industrial undertakings
7659
14.58
91.17 57.18 063
57.81
The name of small scale industrial undertaking to whom amount is outstanding for more than 30 days are Alok Industries Delhi. Bells
Insulation Pvt Ltd. New Delhi. Siddharth Plastic Industries, Daman. Silvassa Wooden Drums. Silvassa, Alok Masterbatches Ltd.. Delhi &
Cableguaid Technologies (India) Ltd. in case of parent company and Sachin Engineering Works. Stun Engineers. Singh Eiectricals, Shree
Chemicals, Jeet Engineering Works & Microtech Services in case of Joint Venture.
52
slx'xxjix :x iS. :-M--K :S '?' : W?4' Y ::xi: ;;*;;::; :; ":: ; g rt- ; :. ' ^!;;;;:^0x::l;:$^
s -:;;:: :;; kSSsf;-: "': ?::ss;J:::::S:;.::;:::s;G, ompany; .:, >i;
:;
Total
;Ss:Ubsiiiiftrie$::;:;::
^::;-;::xxi*':/': '' 'iS-SiK;:*- Sf i&SiSiiliciiia'f (SS::*^''-
.:.:;:,, :.:: ::;;> . Xx::- : : x:::;:: : VxXx :xxx:;x.,:, . x : ::x; :.::

X ;' : xxXxxXx-X: :.:.; '^.^/.:.: ,. .^xX^xX^S..^^^:::;- ....
; ;AsSt; SlIslMsftifjSaaoS: j: ::::;:;: ;:;,-'

^xx:Joif(txxx:x::;xxici^rx
Ss;;irt;SciS;ft
SCHEDULE 14 : PROVISIONS
For Custom duty
., Gratuity
80.82
Leave encashment
73.96
45.44
7.48
9.75
200.22
17.23
" Pension
Total
80.82
81.44
55.19
24.42
63.68
65.27
43.51
217.45
196.88
24.42
6.24
9.48
15.72
63.68
71 51
52,99
212.60
SCHEDULE 15 : MISCELLANEOUS EXPENDITURE
(To the extent not written off)

Preliminary expenses
1.08
1.08
^
^^
;' : '"":' :
,: in tecs
R& in IMS
;:; : : :;:;:BS::Wâcs::::': :; ;R:;:|h iaGS: :|:::F!s:: irV:ifiGB:: :
SCHEDULE 16 : TURNOVER
Finished goods
Others
Total
15151.99 .
567.55
1304.93
46.86
16456.92
614.41
9347.18
635.10
921.33
21.03
10768.51
656.13
15719.54
1351.79
17071.33
10482.28
942.36
11424.64
162.28
3.33
242.57
20.77
3.33
263.34
294.08
SCHEDULE 17 : OTHER INCOME
Interest:
-on sale on deferred payments (Gross)
(Tax Deducted at Source Rs.Nil (Rs.Nil)
-on bank deposits (Gross)(Tax deducted at source Rs.1.98 lacs

(Rs.11.53 lacs) (including Rs.0.12 lac (Rs.0.10 lac) of Joint Venture)
146.47
-others (Gross) (Tax deducted at source Rs.0.89 lac (Rs.5.61 lacs))
174.57
6.30
180.87
284.63
9.45
397.32
1.96
99.89
35.24
27.12
24.01
29.76
3.26
36.57
0.03
5.46
17.56
5.81
397.35
7.42
117.45
41.05
27.12
24.01
45.18
3.61
38.49
243.95
72.11
10.38
332.77
67.02
976.17
68.66
1044.83
1406.06
111.70
1517.76
566.98
60.59
627.57
1446.58
198.49
1645.07
15.81
(including Rs.0.19 lac (Rs.0.06 lac) of Joint Venture)

Dividend income
-on investments (Long term) (Trade)

-on investments (Current) (Trade)
Discount on prepayment of interest free sales tax loan liability
Unspent liabilities/sundry balances written back
Provision for diminution in the value of investment written back

Provision for doubtful debts written back
Profit on sale of current investments (Trade) (Net)
Profit on disposal of fixed assets
Miscellaneous income
Total
15.42
0.35
1.92
79.80
1.53
243.95
82.49
399.79
81.33
6.36
3.99
136.55
0.54
2.01
6.36
4.53
138,56
SCHEDULE 18 : RAW MATERIALS CONSUMED

Add: Purchases (Less : sales and claims Rs.71.28 lacs
(Rs.21.39 lacs) (including Rs. 15.74 lacs (Rs.2.11 lacs)
of Joint Venture))
11457.89
1006.81
12464.70
6839.93
525.00
7364.93
1067.40 13092.27
90.86
1046.81
8286.51
566.98
723.49
60.59
9010.00
Less: Inventories as at 31st March 31, 2006
12024.87
955.95
11068.92
976.54 12045.46
7719.53
662.90
8382.43
0.18
10.28
10.46
9.09
18.60
18.27
36.87
25.27
44.06
174.96
219.02
18.42
0.18
1.37
11.60
200.60
Total
627.57
SCHEDULE 19 : COST OF TRADED GOODS SOLD
18.42
7.99
26.41
16.18
Add: Purchases
Less: Inventories as at 31st March 31. 2006
Total
10.23
53
0.18
0.18
4424
174,96
21920
1860
200 60
:;:;^
Sss;:Jo'jntS
I:*:.l!l^^
|
i:;:li;lll^^
:
:i: SanilSife:;: : Venture

ubsKtiarjes
%:-'- -fill
^^:^^^^-:^-:^^
Miiaes :SSlRfc in lares:; :
::Rs;::ih
:
laes; ;x; ; 8s in tecs :
SCHEDULE 20 : PERSONNEL EXPENSES
Salaries, wages and bonus

Contribution to provident and other funds
Workmen and staff welfare expenses
551.59
466.11
36.46
502.57
77.49
6.16
83.65
37.96
5.22
43.18
50.45
4.33
54.78
52.28
3.50
55.78
636.86
53.16
690.02
556.35
45.18
601.53
8.69
357.05
242.27
4.76
247.03
508.92
Total
42.67
SCHEDULE 21 : OPERATING AND OTHER EXPENSES
Consumption of stores and spares
348.36
Packing materials
343.46
25.79
369.25
238.82
19.66
258.48
Power and fuel
428.33
34.82
463.15
366.28
30.76
397.04
9.60
1.23
10.83
3.44
0.81
4.25
Freight and transportation (Net)
15.56
1.10
16.66
19.64
1.37
21.01
Processing and testing charges
244.85
48.68
Sales commission
3.27
248.12
45.13
3.55
5.03
0.23
5.26
3.81
0.10
3.91
Rent
10.61
0.41
11.02
17.32
0.99
18.31
Rates & taxes
23.20
2.17
25.37
8.41
0.12
8.53
Insurance charges
37.16
2.23
39.39
34.94
2.21
37.15
Excise duty on stocks etc.
Repair & maintenance

- Plant & machinery
4928
21.99
71.27
1947
11.94
31.41
- Buildings
61.42
2.70
64.12
39.95
1.06
41.01
- Others
14.57
0.08
14.65
13.94
0.05
13.99
Directors' sitting fees
1.74
0.25
1.99
1.21
0.17
1.38
Auditors' remuneration
Statutory auditors
- Audit fees
3.24
0.40
3.64
3.29
0.27
3.56
-Tax audit fees
0.91
0.04
0.95
0.82
0.04
0.86
-Company law matters
1.75
0.13
1.88
1.89
0.13
2.02
-Quarterly reviews
450
0.10
4.60
4.62
0.10
4.72
-Certification etc.
5.20
0.11
5.31
3,92
0.07
3.99
-Out of pocket expenses
1.19
0.08
1.27
1.10
0.10'
1.20
0.30
Cost auditors
- Audit fees
0.30
-Supervision fees
-Reimbursement of expenses
0.07
Donation and contributions
0.03
0.33
0.01
0.01
0.01
0.08
0.05
0.05
0.02
0.02
47.07
4.26
51.33
Provision foi diminution in the value of current investments
Loss on sale of current investments (Trade)
Provision for doubtful debts and advances
42.48
0.16
42.48
32.55
0.03
0.33
0.01
0.01
0.01
0.17
2.07
2.07
32.55
Sundry advances/bad debts written off
1.26
1.26
13.66
0.19
13.85
Loss on disposal of fixed assets
6.96
1.71
8.67
11.90
0.31
12.21
Exchange rate fluctuation (Net)
32.26
1.21
33.47
7.46
0.51
7.97
Preliminary expenses written off
1.08
1.08
Miscellaneous expenses
Total
1.08
1.08
322.45
27.06
349.51
284.08
28.53
312.61
2016.82
135.90
2152.72
1468.53
114.20
1582.73
Mftt&JS&f S*:t|S:êar:Bfided::3i st IMarcS:2005
trtSipififirid
:i::S:iteiw!::5mm Total; i: iGpmpsny : ; 'Joint::;:
;si!;i;;:;S;:::;l!^
ljj$i$jj$t:
jllli!:^:*:.
iVehlurex-
i;S:'S?5S;:;>^SiisSBiSjrifeSS;;;; :
jsi diaries
SCHEDULE 22 : (INCREASE)/DECREASE IN INVENTORIES
Work- in-progress
1064.05
Finished goods
Scrap

Work- in-progress
Total
1146.18
784.73
27.15
811.88
9.90
0.91
10.81
0.51
39.46
2.97
42.43
10.17
1103.51
85.10
1188.61
804.80
28.57
833.37
784.73
27.15
811.88
625.12
0.91
10.81
586.96
10.06
38.16
9.90
0.24
10.30
10.17
0.51
10.68
6.19
804.80
28.57
833.37
603.21
38.87
642.08
(298.71)
(56.53)
(355.24)
(201.59)
10.30
(191.29)
68.15
3.35
71.50
55.99
2.02
58.01
70.78
7.96
78.74
24.77
4.06
28.83
138.93
11.31
150.24
80.76
6.08
86.84
647.14
61.57
708.71
545.12
61.30
606.42
2.05
2.22
706.66
542.90
Finished goods
Scrap
82.13
0.47
10.68
6.66
SCHEDULE 23 : FINANCIAL EXPENSES
Interest
- to banks and others

Bank charges
Total
SCHEDULE 24 : DEPRECIATION
On fixed assets
Less: Transfer from capital reserve
2.05
Total
645.09
61.57
2.22
61.30
604.20
SCHEDULE 25 : EXCEPTIONAL ITEM
7.08
7.08
SCHEDULE 26 : INCOME TAX
3.65
(51.42)
Income tax for current year

Deferred Tax (Credit)
1.13
(12.06)
4.78
(63.48)
Income tax credit for earlier years (Net)

Total
(47.77)
55
(10.93)
(58.70)
(0.32)
(26.12)
(0.22)
(9.80)
(0.54)
(35.92)
SCHEDULE 27 : NOTES TO THE CONSOLIDATED ACCOUNTS
NOTES annexed to and forming part of the Consolidated Balance Sheet as at 31st March, 2006, Consolidated Profit & Loss Account and
Consolidated Cash Flow for the year ended on that date.
1
The Consolidated Financial Statements relate to Vindhya Telelinks Ltd. (Parent Company), its subsidiary companies and its joint
venture companies. The Consolidated Financial Statements have been prepared on the following basis:
(i)
The financial statements of the Parent Company and its subsidiary companies have been combined on a line by line basis by
adding together the book values of like items of assets, liabilities, income and expenses after fully eliminating infra group
balances and intra group transactions.
(ii)
The financial statements of the subsidiaries and joint ventures used in the consolidation are drawn for the same reporting period
as that of the Parent Company i.e year ended 31st March, 2006.
(iii)
The list of Subsidiary Companies which are included in the consolidation and the Parent Company's holding therein are as
under:
:
;i ;; sGoufttry sot incorporation
SS'ttSrMISfrSti^SiW^
(iv)
Percentage: of Ownership
August Agents Limited
India
100.00
Insilco Agents Limited
India
100.00
Laneseda Agents Limited
India
100.00
Optic Fibre Ooa Limited
India
55.00
Joint Venture Companies - In accordance with Accounting Standard 27 issued by the Institute of Chartered Accountants o!
India, the Company has prepared the accompanying Consolidated Financial Statements by including the Company's
proportionate interest in the Joint Venture's assets, liabilities, income, expenses and other relevant information after eliminating
parent company's and its subsidiaries' share in intra group balances Rs.186.50 lacs (Previous year Rs.186.62 lacs) arid intra
group transactions Rs. 28.09 lacs (Previous year Rs. 14.17 lacs). Details of Joint Venture Companies are as follows.
:;:i:::$iSjifh$t-;i^^
^^^CiiV---^
Birla Ericsson Optical Limited
; : : :Cc)ti(itry <rf Incorporation
Percentage W: Ownership
India
13.33
India
4.62
Universal ABB Power Cables Limited

(UAPCL)*
*As the Parent Company has written off the entire value of investments in the said Joint Venture since the Joint Venture has
wound up the operations during the year, the accounts of said Joint Venture has not been consolidated.
(v) The Parent Company has a joint venture (with other joint venture partners) in a company called "Optic Fibre Goa Ltd" (OFGL)
The latter Company is also subsidiary of the Company since the Parent Company holds 55% of the share capital in the said
company. The Board of Directors of OFGL in its meeting held on 18th April, 2006 has decided to merge the Company with one
of its promoter company w.e.f. April 1, 2005 and has initiated the process of getting requisite approvals. However, in view of
long term and strategic investment in the aforesaid subsidiary, the control has not been considered temporary in nature in the
said company and the same has been consolidated as subsidiary.
(vi) The Parent Company by itself or alongwith its three subsidiaries hold more than 20% of the voting power of two other
companies. In the opinion of the management, the Parent Company does not have any "Significant Influence" in the said two
companies as defined in Accounting Standards '18' "Related Party Disclosures" and '23' "Accounting for investments in
associates in Consolidated Financial Statement". The Parent Company has also sought legal opinion regarding this and
therefore, has not considered the above investees as a "Related Party" under AS 18 and not consolidated the accounts of the
above as "Associate" under AS-23.
(vii) Minorities' interest in net loss of consolidated subsidiary for the year has been identified and adjusted against the income in
order to arrive at the net income attributable to the shareholders of the Parent Company Minorities' interest in net assets has
been identified and presented in the Consolidated Balance Sheet separately.
STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES:
(a) Basis of Preparation:

The Financial Statements have been prepared to comply in all material respect with the mandatory Accounting Standards issued by
the Institute of Chartered Accountants of India and the relevant provisions of Companies Act. 1956. The Financial Statements have
been prepared under the historical cost convention modified by revaluation of fixed assets, on an accrual basis. The accounting
policies have been consistently applied by the group and are consistent with those used in the previous year.
(b) Fixed Assets:
Fixed Assets are stated at cost (including revalued amounts), less accumulated depreciation and impairment losses, if any Cost
comprises the purchase price and any attributable cost of bringing the asset to its working condition for its intended use. Financing
costs relating to acquisition of fixed assets are also included to the extent they relate to the period till such assets are ready to be
put to use. When fixed assets are revalued, any surplus on revaluation is credited to assets revaluation reserve.
The carrying amounts of assets are reviewed at each balance sheet date if there is any indication of impairment based on internal/
external factors. An impairment loss is recognized wherever the carrying amount of an asset exceeds its recoverable amount The
recoverable amount is the greater of the assets' net selling price and value i,i use. In assessing value in use. the estimated future
cash flows are discounted to (heir present value at the weighted average cost of capital.
56
(c) Depreciation:
Premium on leasehold land is amortised over the life of the lease.

Depreciation on second hand plant and machinery, purchased in the previous year in case of parent company which are
estimated to have lower residual lives than envisaged as per the rates provided in Schedule XIV to the Companies Act, 1956,
has been provided based on the estimated lower residual life by using the straight line method.
(iii) Depreciation on Fixed Assets of Unit No 1 and Computer Systems of the Parent Company (29.67% of total Fixed Assets) is
provided on written down value method at rates, computed based on estimated useful life of the assets, which are
equal to the corresponding rates prescribed under Schedule XIV to the Companies Act, 1956.
(iv) Depreciation on all other Fixed Assets is provided on Straight Line Method at rates, computed based on estimated useful life
of the assets, which are equal to the corresponding rates prescribed under Schedule XIV to the Companies Act, 1956.
Depreciation on additions due to foreign exchange fluctuation is provided over the remaining useful lives of the assets.
Depreciation on insurance spares capitalized in Parent Company is provided retrospectively from the date the related mother
assets are put to use. Depreciation on insurance spares capitalized in joint venture company is amortized over the residual
life of the respective assets (0.06% of total fixed assets).
(d) Investments:
Investments that are readily realisable and intended to be held for not more than a year are classified as current investments.
All other investments are classified as long term investments. Current investments are carried at lower of cost and fair value
determined on an individual investment basis. Long term investments are carried at cost. However, provision for diminution
in value is made to recognize a decline other than temporary in the value of the investments.
(e) Inventories:
Inventories are valued as follows:
Raw materials. Stores & spares and
Traded goods
Cost is determined on a weighted average basis.
Work-in-progress and finished goods
(Own manufactured)
Cost includes, direct materials and labour & proportion of manufacturing

overheads based on normal operating capacity. Cost of finished goods
includes excise duty.
Scrap
Net realisable value.
Net reaHsable value is the estimated selling price in the ordinary course of business, less estimated costs of completion and
to make the sale.
(f)
Revenue Recognition:
Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the revenue
can be reliably measured.
Sale of Goods:
Revenue is recognized when the significant risks and rewards of ownership of the goods have passed to the buyer. Credits/
debits arising out of finalisation of provisional prices on supplies are accounted for in the year of their acceptance since it is
not possible to ascertain the exact quantum in respect thereof with reasonable accuracy.
Interest:
Revenue is recognized on a time proportion basis taking into account the amount outstanding and the rate applicable.
Dividend:
Revenue is recognized when the shareholder's right to receive payment is established by the Balance Sheet date.
(g) Foreign Currency Transactions:

(i)
Initial Recognition
Foreign Currency Transactions are recorded in the reporting currency, by applying to the foreign currency amount the
exchange rate between the reporting currency and foreign currency at the date of the transactions.
(ii)
Conversion:
Foreign currency monetary items are reported using the closing rate.
(iii)
Exchange Differences:
Exchange differences arising on the settlement of monetary items at rates different from those at which they were initially
recorded during the year, or reported in previous financial statements, are recognized as income or as expense in the
year in which they arise except those relating to acquisition of fixed assets from outside India which are adjusted to the
carrying amount of fixed assets.

(iv) Forward Exchange Contracts not intended for trading or speculation purposes:
The premium or discount arising at the inception of forward exchange contracts is amortised as expense or income over
the life of the contract. Exchange differences on such contracts are recognized in the statement of profit and loss in the
year in which the exchange rate changes. Any profit or loss arising on cancellation of renewal of forward exchange
contract is recognized as income or expense for that year.
(h) Retirement Benefits:
(i)
Retirement benefits in the form of Provident Fund and Superannuation Fund are charged to profit and loss account
of the year when contributions to the respective funds are due.
The Group accounts for the contributions under
Superannuation Scheme being made to Life Insurance Corporation of India (LIC) against an insurance policy taken
with them.
57
(ii)
Provision for gratuity (including past services of employees who were in other group companies), leave encashment
and pension is accrued and provided for on the basis of an actuarial valuation made at the end of each financial year,
(iii) Payments made under Voluntary Retirement Scheme are charged to the profit and loss account in the year in which the
employee accepts the early retirement,
(iv) Ex-gratia or other amount disbursed on account of selective employees separation scheme are charged to Profit and
Loss Account,
(i)
Income Taxes:
Tax expenses comprises current, fringe benefit and deferred taxes. Current income tax and fringe benefit tax are
measured at the amount expected to be paid to the tax authorities in accordance with the Indian Income Tax Act. Deferred
Income Tax reflects the impact of current year timing differences between taxable income and accounting income for
the year and reversal of timing differences of earlier years. Deferred Tax is measured based on the tax rates and the tax
laws enacted or substantively enacted at the Balance Sheet date. Deferred tax assets are recognized only to the extent
that there is a reasonable certainty that sufficient future taxable income will be available against which such deferred tax
assets can be realized. Deferred Tax Assets are recognized on carry forward of unabsorbed depreciation and tax losses
only if there is virtual certainty that such deferred tax assets can be realized against future taxable profits. Unrecognised
deferred tax assets of earlier years are re-assessed and recognized to the extent that it has become reasonably certain
that future taxable income will be available against which such deferred tax assets can be realized
(j)
Earnings Per Share:

Basic earnings per share is calculated by dividing the net profit or loss for the year attributable to equity shareholders by
the weighted number of equity shares outstanding during the year. The weighted average number of equity shares
outstanding during the year are adjusted for events of bonus issue, bonus element in a right issue to existing shareholders,
share splits and reverse share split (consolidation of shares).
For the purpose of calculating diluted earnings per share, the net profit or loss for the year attributable to equity
shareholders and the weighted average number of shares outstanding during the year are adjusted for the effects of all
dilutive potential equity shares,
(k) Provisions:
A provision is recognised when an enterprise has a present obligation as a result of past event; it is probable that an outflow
of resources will be required to settle the obligation, in respect of which a reliable estimate can be made. Provisions,
except those disclosed elsewhere in the notes to the financial statements are not discounted to its present value and are
determined based on best estimate required to settle the obligation at the balance sheet date. These are reviewed at each
balance sheet date and adjusted to reflect the current best estimates Provision for expenditure relating to voluntary
retirement is made when the employee accepts the option of early retirement under the Voluntary Retirement Scheme.
(I)
Miscellaneous Expenditure (to the extent not written off):

Preliminary Expenses incurred by three of the subsidiaries are amortised over a period of ten years and in case of one
of the subsidiary, over a period of five years.
SEGMENT INFORMATION:
The Group is solely engaged in the activity of manufacturing Telephone Cables i.e. Jelly Filled Telephone Cables, Optical Fibre
Telephone Cables and their raw material i.e. Fibre Ribbon The entire operations are governed by the same set of risk and returns
Hence, the same has been considered as representing a single segment. The said treatment is in accordance with the guiding principles
enunciated in the Accounting Standard 17 on Segment Reporting.
The Group sells its products mostly within India with insignificant export income and does not have any operations in economic
environments with different risks and returns. Hence, it is considered operating in a single geographical segment.
RELATED PARTY DISCLOSURE:
Subsidiaries
August Agents Ltd.', Insilco Agents Ltd.*, Laneseda Agents Ltd." and
Optic Fibre Goa Ltd.
Joint Ventures
Birla Ericsson Optical Ltd. and Universal-ABB Power Cables Ltd.'
Key Management Personnel
Shri R.G. Mundra (Managing Director of the Parent Company)
Shri D.R.Bansal (Managing Director of the Joint Venture Company)

Shri S.K.Daga (Whole-time Director of August Agents Ltd , a subsidiary company)
Shri D.L.Rathi (Whole-time Director of Insilco Agents Ltd., a subsidiary company)
Shri K.Damani (Whole-time Director of Laneseda Agents Ltd.. a subsidiary company)
Shri Kapil Mehta (Manager of Optic Fibre Goa Ltd a subsidiary company)
Other parties which significantly
Universal Cables Ltd.
influence/are influenced by the

Company (either individually or
with others)
* N
' 3">!ur.tinrs hnvp taken place with these companies during the year.
; Vfehture
:
:
Rs.in lacs
(i)
Transactions during the year

a) Purchase of Raw Materials, Stores,
Spares and Packing Materials
102.46
14.30
4.63
0.33
5.31
b)
Sale of Raw Materials, Stores,

Spares and Packing Materials
427.33
43.21
1.28
0.36
5.93
c)
Other Service Charges/Lease

rent Received
8.25
72.75
0.64
6.90
3.00
d)
Other Service Charges Paid
7.41
8.41
2.51
1.74
52.45
19.97
1.80
e)
Sale of Fixed Assets
1.85
4.24
f)
Purchase of Fixed Assets
2.12
0.01
g)
Interest on Inter-Corporate
Deposits Received
h)
Interest on Inter-Corporate
0.88
Deposits Paid
71.12
9.74
0.85
19.51
18.69
20.32
10.98
330.16
6.01
5.84
157.33
16278
1.03
i)
Inter-Corporate Deposits Granted
381.35
93.31
115.97
800.00
1050.00
j)
k)
Inter-Corporate Deposits Refunded

Inter-Corporate Deposits taken
381.35
153.30
22.66
2300.00
400.00
I)
Inter-Corporate Deposits repaid
178.54
33.33
93.31
29.00
1150.05
2650.00
178.54
Balance outstanding at the year end

a)
Sureties
b)
Receivables
c)
Payables
15.35
0.07
171.99
0.18
1.19
2005-2006"
Managing Director and Whole Time Directors Remuneration
2004-2005"
Rs. in lacs
Rs in lacs
18.87*
16.21*
* Excluding contribution/provision for gratuity, provisions for pension and leave encashment, being the figures those are actuarially
deiermined for the Company as a whole and therefore, are not separately available
"* Including Rs.5.58 lacs (Rs.3.60 lacs) of the parent company paid to the manager of a subsidiary company in other capacity during
his tenure as manager and Rs.1.49 lacs (Rs. 1.42 lacs) of a Joint Venture.
Notes:
(i)
No amount has been provided as doubtful debt or advance written off or written back in the year in respect of debts due from/
(ii)
to above related parties.

Transactions and balances relating to reimbursement of expenses to/from related parties have not been considered above.
Estimated amount of contracts remaining to be executed on capital accounts and not provided for (net of advance) Rs.10.60 lacs (Rs.
3.77 lacs) (including Rs.1.60 lacs (Rs.3.77 lacs) in case of joint venture).
Contingent liabilities (not provided for) in respect of:

(i)
(ii)
Sureties given on behalf of a Body Corporate Rs.29.00. lacs (Rs.171.99 lacs),

Claims against the Group not acknowledged as debts Rs.5.66 lacs* (Rs.6.06 lacs) (including Rs.1.44 lacs (Rs. 1.84 lacs) of joint
venture)),
(iii) Pending cases with Income-Tax Appellate authorities where Income Tax Department has preferred Appeals - liability not
ascertainable.
* Based on the discussions with the Solicitors, the management believes that the Company has a strong chance of success in the
above mentioned cases arid hence no provision there against is considered necessary.
The Parent Company and a joint venture has filed a law suit against an overseas supplier and its agent relating to the validity and
existence of an alleged agreement before a competent court which is already seized of the said suit. The supplier, in order to
overreach the said Law Suit, has initiated an arbitration for claiming recovery of value of the unsupplied goods for the period from
October, 2002 to September. 2006 aggregating to Rs.4883.86 lacs (value as on 31st March. 2006). (including Rs.574.45 lacs share of
a joint venture). The said arbitration proceeding have been stayed by the order of the Competent Court. The Parent Company
and the joint venture have been legally advised that the said claim against the Parenl Company and a joint venture is unsustainable and
there is no likelihood of any liability arising against the Parent Company and a joint venture.
59
8.
9.
10.
11.
The Parent Company and a joint venture have during the year made prepayment of Deferred Sales Tax Interest Free Loan Liability of
Rs.335.38 lacs (including Rs.32.19 lacs of joint venture) as per relevant Notification issued by the Madhya Pradesh State Government.
The discount received against such prepayment amounting to Rs117,45 lacs (including Rs. 17.56 lacs of joint venture) has been included
under other income.
The exchange difference loss of Rs.0.07 lac (Rs.Nil) of a Joint Venture in respect of outstanding forward exchange contracts will be
recognised in the Profit & Loss Account in subsequent accounting period.
Prior period items in case of the Parent Company comprise expenses in respect of demand charges from Madhya Pradesh State
Electricity Board amounting Rs.14.10 lacs (Rs.Nil), Interest on above Rs.2.05 lacs (Rs.Nil), Municipal Tax Rs.6.78 lacs (Rs.Nil) and
Gratuity Liability Rs.9.16 lacs (Rs.48.93 lacs).
(i) Components-of Deferred Tax arising on account of timing differences alongwith their movement as at 31st March, 2006 is as
given below:
1
1
^
jsTotai:5
Deferred tax liability (A)
- Differences in depreciation and other

differences in block of fixed assets
as per tax books and financial books
641.20
55.13
696.33
693.10
64.39
757.49
587.23
51.44
638.67
587.71
48.64
636.35
53.97
3.69
57.66
105.39
15.75
121.14
Deferred tax asset (B)
- Unabsorbed depreciation
Deferred tax liability (Net) (A-B)
(ii)
Pursuant to Accounting Standard (AS) 22 "Accounting for Taxes on Income", the Parent Company and its Joint Venture has, based
on prudence, not recognised deferred tax assets amounting to Rs.497.60 lacs (Rs.559.96 lacs) (including Rs.23.81 lacs (Rs.35.70
lacs) of Joint Venture) on all the timing differences excepting unabsorbed depreciation (excepting unabsorbed depreciation and
expenses in case of a Joint Venture).
12. Supplementary Statutory Information (Managerial Remuneration).
(a) Salary
(b)
(c)
(d)
(e)
Commission"
Contribution to Provident Fund
Sitting Fees
Perquisites
Total
13.97
1.12
15.09
11.59
1.06
12.65
1.39
0.20
0.13
0.03
1.17
1.82
0.21
1.52
0.23
2.03
0.21
1.82
0.13
0.03
0.20
1.30
0.24
2.02
17.38
1.49
18.87'
1.42
16.21*
14.79
* Excluding contribution/provision for gratuity, provision for pension and leave encashment, being the figures those are actuarially
** In view of loss computed in accordance with Section 349 of the Companies Act, 1956, no commission is payable to Managing
Director of the Company.
13. Figures of previous year have been shown in brackets and regrouped wherever necessary.
Signatures to Schedule 1 to 27
R.S.Lodha

J.Veeraraghavan
S.K.Misra
Per ANIL GUPTA

Partner
Membership No.87921
R.C.Tapuriah
D.R.Bansal
t
I
S Directors
/
H.V.Lodha
Pracheta Majumdar
Chairman
\
R.G.Mundra
Managing Director
Gautam Sharma

60
FORM OF PROXY

Regd. Office: Udyog Vihar, RO.Chorhata, Rewa -486 006 (M.P.)
DP ID*
Registered Folio No.
Client ID*
I/We____________________;______________________________________________________
of _________;_________________________________________________
___________________________
being a member/members of the above named Company, hereby appoint
Mr./Mrs._______________________________
district of _______________
in the district of
of ___________________________
in the
or failing him/her Mr./Mrs. _______________________________
of
____________________________________
in the district of _________________________________
as my/our proxy to vote for me/us and on my/our behalf at the Twenty Third Annual General Meeting of the Company to
be held on Wednesday, the 12th July, 2006, and at any adjournment thereof.
Signed this _____ day of ___________, 2006.
Affix
Revenue
Signature ________
Stamp of
Thirty
Raise
* Applicable for members holding shares in dematerialised form.
f 1) This proxy form must be deposrted at the Registered Office of the Company, not less than 48 hours before the time for holding the Meeting Unless otherwise instructed,
the proxy will vote as he/she thinks fit

(2) Members who hold shares in the dematerialised form are requested to quote their DPI D and Client ID for identification.
ATTENDANCE SLIP

Regd. Office: Udyog Vihar, RO.Chorhata, Rewa-486 006 (M.P.)
To be handed over at the entrance of the Meeting Hall

Full name of the
Member attending
: _____________________________________________________________________
Full name of the

First joint-holder
: _________________________________'__________________________
(To be filled in if first named joint-holder does not attend the Meeting)
Name of Proxy
: _______________________________________________________
(To be filled in if Proxy Form has been duly deposited with the Company)
I hereby record my presence at theTWENTY THIRD ANNUAL GENERAL MEETING being held at the Registered Office of
the Company on Wednesday, the 12th July. 2006.
Regstered Folio No.
DP ID*
Client ID*
No. of Shares held
Member's/ Proxy's Signature

(To be signed at the time of handing over this slip)
' Applicable for members holding shares in dematerialised form.

Note: Persons attending the Annual General Meeting are requested to bring their copies of Annual Report.
BOOK POST
PRINTED MATTER
If undelivered please return to :

Regd. Office : Udyog Vihar, P.O. Chorhata, Rewa - 486 006 (M.P.), India

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Vindhya Telelinks Limited

VINDHYA TELELINKS LIMITED

By order of the Board

COMMENCEMENT OF THE MEETING.

By order of the Board

List of outside Directorships held*

Industrialist with wide experience in An eminent Chartered Accountant and a

Alfred Herbert (India) Ltd.

Birla Ericsson Optical Ltd.

Chairman/Member of the Committee of the

Chairman/Member of the Committee of the Member- Audit Committee & Share

Chairman- Audit Committee of OCL (India) Ltd.

New India Sugar Mills Ltd.

- Audit Committee of Fenner (India)

Shareholding (both own or held by/for

31st March, 2005

Gross Income for the year rs

The year's working shows a Gross Profit after interest of

Profit before Exceptional Item, Prior Period Items and Tax

Exceptional Item (Voluntary Retirement Compensation)

Income Tax for current year

Income Tax-Credit for earlier years (Net)

Net profit for the year is

Credit balance brought forward

which has been carried to Balance Sheet

significant improvement during the year compared to the previous year.

bankers for their continued support.

New Delhi, April 29, 2006.

The Company adopted following measures on energy conservation:

Optimization of DG Sets by implementing higher specific energy generation ratio (SEGR).

Energy saving by achieving unity Power Factor.

Putting off one Transformer by load optimization.

Optimization of plant lighting and outdoor lighting.

Engineering changes to minimize power consumption on machines.

Research and Development (R&D)

1. Specific areas in which R&D carried out by the Company

(a) Process re-engineering and optimization of process

2. Benefits derived as a result of the above R&D

(a) Technology upgradation, enhanced flexibility, cost

3. Future plan of action

Continue efforts for development of new products, in

R&D expenditure have not been accounted for

(b) Opportunity to compete in International Market.

II. Technology absorption, adaptation and innovation

used to manufacture various

products of the Company in process control, product

2, Benefits derived as a result of the above efforts,

FOREIGN EXCHANGE EARNINGS AND OUTGO

New Delhi, April 29,2006.

Jelly Filled Telephone Cables

Authorization, recording and reporting of transactions.

Recording and safeguarding of assets.

Maintenance of accounting records and reliability of financial information.

Key elements are :

tracing from finished products to raw material stage.

Routine evaluation of all financial, operating and information technology systems.

INDUSTRIAL RELATIONS, HUMAN RESOURCE DEVELOPMENT AND SOCIAL RESPONSIBILITIES

maximize his contribution.

number of permanent employees as on 31st March, 2006.

CORPORATE GOVERNANCE PHILOSOPHY

;N,aj^&;bf:|he::pjr^;tcif::|| iSseStîory,;::??::;;: :::::;g4::::::AttendanceSs::::;: :. ::*::::V:::::.>Nov.:of;:otfiKf;pjSii(iifiMpa ''îîriîb^sS'iSsSi;

Shri Pracheta Majumdar

(Independent Non-Executive Director)

payment of declared dividends) and creditors