DCW Ltd. - Annual Report - 2005-2006

Corporate Directory LIMITED
BOARD OF DIRECTORS AUDITORS

V. Sankar Aiyar & Co.,
Dr. Shashi Chand Jain Chartered Accountants, Mumbai.
Chairman and Managing Director
Shri Sharad Kumar Jain

Vice Chairman & Managing Director REGISTERED OFFICE
Dhrangadhra 363 315, Gujarat.
Smt. Satyawati Jain

HEAD OFFICE
“Nirmal”, 3rd Floor,
Shri F.H. Tapia Nariman Point,
Mumbai 400 021.
Dr. V.H. Joshi

BRANCH OFFICE
Shri Yuvraj Saheb of Dhrangadhra Indra Palace, 1st Floor,
H-Block, Connaught Circus,
New Delhi 110 001.
Shri Sushil Kumar Jalan
WORKS
Shri Nirmal Kumar R. Ruia Soda Ash Division : Dhrangadhra 363 315,
Gujarat.
Caustic Soda Division : Arumuganeri P.O.,
Shri Pramod Kumar Jain Sahupuram 628 202,
Managing Director Tamil Nadu.
PVC Division : Arumuganeri P.O.,
Sahupuram 628 202,
Shri Bakul Jain Tamil Nadu.
Executive Director Salt Works : Kuda, Gujarat.
Arumuganeri P.O.,
Sahupuram 628 202,
Tamil Nadu.
BANKERS
Punjab National Bank
State Bank of Saurashtra 67th
State Bank of India Annual Report
City Union Bank Ltd. 2005-2006
ING Vysya Bank Ltd.
Note: The Balance Sheet, Profit and Loss Account and Key Financial Data are also presented in US $ on
Page Numbers 15, 16 & 17 respectively.
DCW Limited Ò Annual Report 2005-2006 1

LIMITED Directors’ Report
TO THE MEMBERS account of lower sales realization of realization and lower sales of
PVC. The Gross Profit for the year PVC. Margins on PVC were under
Your Directors present their 67th Annual increased from Rs. 44.42 crores to pressure due to cheap import on
Report and Audited Accounts for the Rs. 55.35 crores. The profit before tax account of reduction in import
Financial Year ended 31st March, 2006: amounted to Rs. 32.29 crores as duty and reduction in duty
against Rs. 23.68 crores in the differential between raw material
1. Financial Results: previous year. After providing Rs. 2.77 and finished good. However all
31-3-2006 31-3-2005 crores for current taxes, Rs. 0.40 crores major users are recording good
(Rs. in lacs) (Rs. in lacs) towards Fringe benefit tax and taking demand and PVC industry
credit for MAT of Rs. 2.72 crores and continues to show positive
Sales 70,358.82 73,590.72 previous year tax adjustments of growth. The Government has
Gross Profit 5,535.05 4,442.26 Rs. 1.30 crores profit before deferred identified irrigation, power and
Less:Provisions tax is Rs. 33.14 crores against previous infrastructure as thrust areas and
years Rs. 21.98 crores. The profit after increased activity in these sectors
Depreciation 2,305.56 2,074.46
provision for deferred tax is Rs. 27.27 are likely to boost demand of PVC
Profit Before Tax 3,229.49 2,367.80 crores against pervious years Rs. 21.03 Resin. However, on account of
Tax: Current 277.49 170.00 crores. Deferred Tax is only a reduction in duty arbitrage
Fringe provision as per guidelines and is not between finished products and
Benefit Tax 40.00 — an outflow. raw material will continue to have
MAT Credit
an impact on the profitability of
Available for 4. Exports: this unit.
set off (272.35) — The Company’s exports are Rs. 67.36
(b) Caustic Soda Division:
Tax adjustments crores as compared to Rs. 72.14 crores
of Previous Year (130.00) — in the previous year, due to marginal The turnover of the division was
reduction in BI Exports. Rs. 204.17 crores as compared to
(84.86) 170.00
Rs. 186.86 crores in the previous
Profit After 5. Divisionwise Performance: year, registering a growth of 9%
Current Tax & in the sales. The increase in
(a) PVC Division:
Tax Adjustments 3,314.35 2,197.80 turnover was on account of better
The turnover of the division was realization on Caustic soda and
Deferred Tax 587.43 94.46
Rs. 350.83 crores as compared to Chlorine. However, the profit was
Profit after Tax 2,726.92 2,103.33 Rs. 426.28 crores, registering a lower on account of increase in
Add: Balance fall of 18% due to lower cost of captive power due to steep
brought forward 2,894.90 2,259.87
increase in oil prices. The
Profit Available production of Caustic Soda was
for Appropriation 5,621.82 4,363.20 60100 MT as compared to 61420
MT in the previous year.
Appropriations: (c) Soda Ash Division:

General Reserves 2,000.00 1,000.00 The turnover of the division was
Dividend 517.63 414.16 Rs. 145.14 crores as compared to
Dividend Rs. 116.91 crores in the previous
Distribution Tax 76.43 54.01 year registering a growth of 24%.
Balance carried
This increase in turnover is due
forward 3,027.76 2,894.91 to growth in sales and better
realization on Soda Ash. The
company produced 87340 MT of
2. Dividend: Soda Ash (previous year 83091
Your Directors recommend payment of MT), 18810 MT of Soda Bi Carb
Dividend (15%) at Rs. 0.30 per equity (previous year 16458 MT) and
share of Rs. 2/- each. 2721 MT of Ammonia Bi
Carbonate (previous year 1950
3. Operations: MT).
Sales during the year were Rs. 703.59 The Company also produced
crores as compared to Rs. 735.91 31815 MT of washing powder
crores recorded in the previous year. compared to 25654 MT in the
The decrease in sales was mainly on previous year.
2 DCW Limited Ò Annual Report 2005-2006

LIMITED
6. Projects Implemented and Under product to international standards plant to 42,000 TPA in the first
Implementation and the product has been well phase. The capacity addition in
(a) Wind Mill Project accepted. The Company now the Beneficiated Ilmenite Plant
proposes to set up a commercial will consume the additional
During the year company has
scale project of 70 - 120 TPD chlorine generated on account of
completed the implementation of
capacity. This project may be increase in caustic soda capacity.
its Windmill project of 11.2 MW
implemented by way of a joint The project is estimated to be
capacity in the State of
venture with an international completed within a period of 24
Tamilnadu, comprising of 14
company of repute. After months.
windmills. The company is taking
implementation of the project,
necessary steps to get Carbon (d) Thermal Power Plant at
there will be zero pollution. This
Credit for this project. Sahupuram
project is estimated to be
(b) Calcium Chloride Project completed within a period of 18 Caustic Soda is a power intensive
to 22 months. With an estimated product and the cost of power
Company is in process of
capital expenditure of Rs. 125 constitutes about 65% - 70% of
implementing project for
crores. the total cost. The present Captive
manufacture of Calcium Chloride
Power Plant set up in the year
out of the waste liquor. This (c) Increase of Capacity of
1995 – 96 comprises 6 x 6 MW
project is also for pollution Beneficiated Ilmenite Plant
DG Sets. Due to steep increase in
abatement. Calcium Chloride is Chlorine generated while the oil prices, the cost of
used mainly in Drilling of Oil manufacturing Caustic Soda is generating power and steam has
Wells, De-icing and in exterior used for the manufacture of gone up. On account of
paints and has a good demand in Trichloroethylene and expansion programme of various
domestic as well as in Beneficiated Ilmenite. Presently plants at Sahupuram, the
international markets. Company manufactures 30,000 requirement of power is estimated
TPA of Beneficiated Ilmenite is to go up from 30 MW to 44 MW
7. New Projects: totally exported and commands and that of steam from 19 TPH to
(a) Conversion of Mercury Cells to good demand in the international 85 TPH. The Company, therefore,
Membrane Cells at Caustic Soda market. The Company proposes proposes to set up a Thermal Co-
Unit to increase the capacity of this generation plant for generating 44
The Company proposes to convert MW of power and 85 TPH steam.
Mercury Cells to Membrane Cells On setting up this co-generation
at its Caustic Soda Unit in plant, the cost of generation of
Sahupuram. The Company has power and steam will come down
awarded the contract to UHDE substantially there by improving
INDIA LIMITED, for supply of the profitability of the company.
membrane cells. On completion The project will be implemented
of the project, production in 18 – 22 months. It will be done
capacity of the Caustic Soda will by well known firm in the field
increase from present 175 TPD to M/s. Thermax Ltd., on turnkey
283 TPD. This will also result in basis.
substantial savings in power. The
project is estimated to be (e) Doubling of Soda Ash Capacity
completed within 24 months. The demand of Soda Ash is going
up by 5% - 7% per annum.
(b) Iron Oxide Pigment Plant Presently the Company’s Soda Ash
To generate a commercially Unit at Dhrangadhra in Gujarat
viable product out of waste liquor manufactures 300 tons per day of
generated out of its Beneficiated Soda Ash. The Company proposes
Ilmenite Plant at Caustic Soda to increase the capacity of its Soda
Unit in Sahupuram and as Ash Plant to 650 tons per day. The
pollution abatement measure, the increase in capacity will give
Company set up in 1995 an Iron benefit of economy of scale and
Oxide Pigment Pilot Plant of 450 improve efficiencies. M/s. Akzo –
TPA. The in-house R&D Noble of Netherland,
Department of the Company international leader in Soda Ash
improved the quality of the technology will provide

LIMITED
technological support for and M/s. R. Nanabhoy & Company

doubling the capacity. This respectively. Their appointments were
project is expected to be approved by the Department of
completed within 24-30 months. Company Affairs. The Cost Audit of
these Divisions is conducted every
8. Capex for New Projects: year and the Reports are submitted by
The capex of the above projects will the Cost Auditors to the Central
be approx. Rs. 700 crores, which will Government.
be met by borrowings from banks,
FCCB issue and from internal accruals. 17. Management Discussion and Analysis
The profitability and turnover of the Report
company will be greatly strengthened Outlook:
and improved.
The Company has a diversified
operation with four business segments
9. Fixed Deposits: viz. PVC, Chlor Alkali, Beneficated
The Company has not accepted any Ilminite and Soda Ash. It is thus
fresh Deposits during the year. reasonably protected from the vagaries
Deposits matured but not claimed as of business cycles of these products.
at the end of the financial year,
amounted to Rs. 0.39 lacs. None of PVC Division:
these deposits have been claimed The Company, one of the six producers
since then. of the PVC resin and despite
competition, has maintained its
10. Corporate Governance: market share of nearly 10%. With
The report on Corporate Governance expected introduction of Value Added
is annexed to this report. Tax (VAT) in Tamilnadu and
14. Directors: Pondicherry, the Company’s
11. Conservation of Energy, Technology competitiveness and profitability is
Shri F.H. Tapia, Shri Yuvraj Saheb of
Absorption and Foreign Exchange likely to improve.
Dhrangadhra and Shri Bakul Jain,
Earnings and Outgo: Directors, retire by rotation at the Caustic Soda Division:
Information pursuant to Section 217 forthcoming Annual General Meeting,
(1) (e) of the Companies Act, 1956, and being eligible, offer themselves for The company continues to be a major
read with the Companies (Disclosure reappointment. player in the South India with a market
of Particulars in the Report of the share of approximately 15%. The
Board of Directors) Rules 1988 is set demand for caustic soda is expected
15. Auditors and Auditors’ Report: to grow at a steady rate of 4% to 5%
out in the Annexure forming part of
this Report. M/s V. Sankar Aiyar & Co., Chartered due to healthy growth in demand from
Accountants - Statutory Auditors of the the end-user industries, specially
Company retire at the forthcoming aluminium.
12. Particulars of Employees:
Annual General Meeting and are The proposed conversion of Mercury
Information in accordance with
eligible for reappointment. Regarding Cell to Membrane Cell will result in
Section 217 (2A) of the Companies
the qualification in the Auditors’ capacity addition and power saving,
Act, 1956, read with the Companies
Report, the notes to the Accounts improving the bottomline.
(Particulars of Employees) Rules, 1975
referred to in the Auditors’ Report are The capacity addition in Beneficiated
is set out in the Annexure forming part
self-explanatory and do not call for Ilmenite Plant will increase exports
of this Report.
any further clarification. and profitable utilization of chlorine.
13. Environment and Safety Measures: Captive Thermal Power plant will
16. Cost Audit: substantially reduce the power and
The Company is committed to
Industrial Safety and Environment In accordance with the directions steam cost.
Protection and these are on going received from the Department of
processes at the Company’s various Company Affairs, the Cost Audit of the Soda Ash Division:
plants. The Sahupuram Unit has been Company’s Soda Ash and Caustic Soda The Soda Ash Industry continues to
granted ISO 14001 Certificate for Divisions were conducted for the grow at a compounded rate of 5 % to
complying with environment Financial Year 2004-2005 by Cost 7% p.a. and this trend is expected to
protection and safety. Auditors, M/s. N.D. Birla & Company continue due to strong demand from

LIMITED
end-user industries. Domestic prices develop close co-ordination with their (c) taken proper and sufficient care
of soda ash move in line with counterparts in industries. This is for the maintenance of adequate
international prices due to the threat basically done to enhance their skills accounting records in accordance
from imports. The decreasing trend of in order to achieve an optimum output with the provisions of the
import duties in India is a cause of from them. Companies Act, 1956, for
concern as decline in landed costs will safeguarding the assets of your
exert pressure on domestic prices. The Cautionary Note: Company and for preventing and
proposed doubling capacity of the Statement in this report describing the detecting fraud and other
plant will result in economy of scale company’s objectives, projections, irregularities; and
and reduction in the cost of estimates, expectations and (d) Prepared the Annual Accounts on
production. predictions may be “forward looking a going concern basis.
statements”. Actual results could differ
Internal Control Systems:
materially from those expressed or
The Company has an adequate implied due to variation in prices of 19. Insurance:
internal control procedure raw materials, cyclical demand and All the properties of the Company are
commensurate with the nature of its pricing in the Company’s principal adequately insured.
business and size of its operations. markets, changes in Government
Internal Audit is conducted at regular regulations, tax regimes, economic
intervals. Internal Audit is conducted 20. Industrial Relations:
developments within India and other
on a regular basis by an independent incidental factors. The relations between the employees
firm of Chartered Accountant. and the management were cordial and
The reports of the internal audit along an atmosphere of understanding
18. Directors’ Responsibility Statement
with comments from the management prevailed throughout the year.
are placed for review before audit In terms of Section 217 (2AA) of the
committee. The Audit Committee also Companies Act, 1956 your Directors 21. Acknowledgement:
scrutinizes all the programmes and the have:
The Board places on record their
adequacy of the internal controls.
(a) Followed in the preparation of the grateful appreciation for the assistance
Annual Accounts, the applicable and co-operation received from the
Human Resources:
accounting standards with proper Financial Institutions and the Banks.
The Company has been following a explanation relating to material
standard procedure for recruitment of departures;
best personnel for all the departments
and is making constant and (b) selected such accounting policies
continuous efforts to retain and groom and applied them consistently and On behalf of the
them to meet its present and future made judgements and estimates Board of Directors
requirements. The current strength is that are reasonable and prudent
2525 employees. The Company so as to give a true and fair view Dr. Shashi Chand Jain
sponsors employees for various of the state of affairs of your Chairman and Managing
seminars on finance, operations, Company at the end of financial Director
marketing and human resource year and of the profit of your
development to update their skills and Company for that period; Mumbai, 23rd May, 2006

Annexure to Directors’ Report
LIMITED Report on Corporate Governance
(Pursuant to Clause 49 of the Listing Agreement)
A. MANDATORY REQUIREMENTS:
1. Company’s philosophy on Code of Corporate Governance:

The Company believes in the practice of good Corporate Governance. A continuous process of delegation of powers
commensurate with accountability coupled with trust, faith and transparency has been embedded in the day to day
functioning. The Company will endeavor to improve on these aspects on an ongoing basis.
2. Board of Directors:
Ò Size of the Board:

The Board of Directors of the Company consists of 10 Directors.
Ò Composition, category and their attendance at the Board meetings during the year and at the last Annual General
Meeting as also the number of other Directorships/Memberships of Committees are as follows:
Attendance Particulars Other Committee

Category of Name of the Director at the Other
Directorship Board Last Directorships Memberships Chairmanships
Meetings AGM
Promoter/ Dr. Shashi Chand Jain 6 No 4 2 —

Executive Directors (Chairman &
Managing Director)
Shri Sharad Kumar Jain 2 No — — —

(Vice Chairman &
Managing Director)
Shri Pramod Kumar Jain 6 Yes 2 — —

(Managing Director)
Shri Bakul Jain 6 No 1 — —

(Executive Director)
Promoter/Non-Executive Smt. Satyawati Jain 4 No — — —

Director
Non-Executive and Shri Yuvraj Saheb of 4 No — — —

Independent Directors Dhrangadhra
Shri F.H. Tapia 5 No — — —
Dr. V.H. Joshi 6 Yes — — —
Shri Sushil K. Jalan 2 No 6 — —
Shri N.R. Ruia 4 No 2 — —
Ò No. of Board Meetings held during the year along with the dates of the meeting:
During the year five Board Meetings were held on:
21.04.2005, 28.06.2005, 27.07.2005, 25.10.2005, 25.01.2006 and 27.03.2006
The Company placed before the Board the Annual Budget, Performance of various units and other information from
time to time as specified in Annexure IA of the Listing Agreement.

LIMITED
3. Audit Committee: Ò Composition, Name of Members and

Ò Terms of Reference: Chairperson:
The terms of reference of this Committee cover The Remuneration Committee comprises 3
the matters as specified for Audit Committees Non-Executive Independent Directors.
under Clause 49 of the Listing Agreement as Shri F.H. Tapia is the Chairman of this
well as per the provisions of Section 292 A of Committee. Dr. V.H. Joshi and Shri Yuvraj
the Companies Act, 1956. Saheb of Dhrangadhra are the other members
of the Committee.
Ò Composition, name of members and Ò Attendance during the year:
Chairperson: There were two Remuneration Committee
The Audit Committee comprises 3 Non- meetings during year held on 27th July, 2005
Executive Independent Directors. Dr. V.H. and 27th March, 2006. All members attended
Joshi is the Chairman of this Committee. the meeting of 27th July, 2005 and Shri F.H.
Shri Yuvraj Saheb of Dhrangadhra and Tapia and Dr. V.H. Joshi were present at the
Shri F.H. Tapia are the other members of the meeting of 27th March, 2006.
Committee. Ò Remuneration Policy:
The Remuneration of Managing Directors and
Ò Meetings and Attendance during the year:
Whole-time Director is approved by the
The Committee met 4 times during the year Remuneration Committee and thereafter by
and the attendance of the Members at these the Board (subject to the subsequent approval by
meetings was as follows: the Shareholders at the general body meeting and
Dates of Dr. V.H. Joshi Shri F.H. Tapia Shri Yuvraj such other authorities as the case may be). The
Meetings Saheb of remuneration is fixed considering various factors
Dhrangadhra such as qualification, experience, expertise,
28.06.2005 Yes Yes No prevailing remuneration in the corporate world,
financial position of the Company etc. The
27.07.2005 Yes Yes Yes
remuneration Structure comprises Salary,
25.10.2005 Yes Yes Yes Perquisites, Commission, Contribution to
25.01.2006 Yes Yes Yes Provident Fund, Super-Annuation Fund and other
funds in accordance with the provisions of
the Companies Act, 1956. The Non-Executive
4. Remuneration Committee: Directors do not draw any remuneration from the
Ò Terms of Reference: Company besides the sitting fees for each
meeting of the Board, Audit and Remuneration
The terms of reference of this Committee cover
Committees attended by them.
the matters as specified for Remuneration
Committees under Clause 49 of the Listing Ò Details of the remuneration paid to the
Agreement. Directors for the Financial year 2004-2005 is
given below:
Directors Salary Perquisites Contribution to Commission Sitting Fees Total
Providend Fund
& Other Fund
(Rs.) (Rs.) (Rs.) (Rs.) (Rs.) (Rs.)
Dr. Shashi Chand Jain 24,00,000 3,27,960 6,48,000 17,11,500 — 50,87,460
Shri Sharad Kumar Jain 24,00,000 *23,40,948 6,48,000 17,11,500 — 71,00,448
Shri Pramod Kumar Jain 24,00,000 3,55,084 6,48,000 17,11,500 — 51,14,584
Shri Bakul Jain 24,00,000 3,27,262 6,48,000 17,11,500 — 50,86,762
Smt. Satyawati Jain — — — 20,000 20,000
Shri F.H. Tapia — — — 37,500 37,500
Dr. V.H. Joshi — — — 42,500 42,500
Shri Yuvraj Saheb of Dhrangadhra — — — 30,000 30,000
Shri Sushil K. Jalan 15,000 15,000
Shri Nirmal Kumar Ruia — — — 20,000 20,000
* Includes Rs. 20,27,988/- paid/reimbursed as medical expenses. This expense by way of enhancement of remuneration was approved by Ministry of
Company Affairs, Government of India vide their letter No. l2/96/2005-CL VII dated 6.10.2005 and has been also approved by Shareholders at their
meeting held on 4.5.2006.

LIMITED
Sitting Fee also includes payment for Board 7. Disclosures:

level committee meetings. 1. During the year, there were no transactions of
Dr. Shashi Chand Jain, Shri Sharad Kumar Jain, material nature with the Promoters, Directors
Shri Pramod Kumar Jain and Shri Bakul Jain are or the management or relatives etc. that may
each entitled for commission @ 25% of the have potential conflict with the interest of the
difference between 10% of the net profits as Company at large.
computed under Section 349 of the Companies
Act, 1956, in a financial year and the aggregate 2. During the last three years, there were no
of the salary and perquisites and benefits paid strictures or penalties imposed by either SEBI or
to all the Managing Directors and Whole-time the Stock Exchanges or any other statutory
Directors in that year subject to the overall authority for non-compliance of any matter
ceilings stipulated in Sections 198 and 309 of related to the Capital Market.
the Companies Act, 1956.
3. DCW Code of Conduct:
The appointments of Managing Directors/
Executive Director are contractual and are for a The Board has laid down a Code of Conduct for
period of 5 years. all Board Members and Senior Management of
the Company. The Code of Conduct is posted
The appointment of the Managing Directors/
on the website of the Company.
Executive Director may be terminated by either
party by giving a six-month notice. In accordance with the Securities and
No severance fee is payable on termination of Exchange Board of India (Prohibition of Insider
appointment. Trading) Regulations, 1992 as amended, the
Board of Directors of the Company formulated
Non-Executive Directors are not paid/entitled
DCW Code of Conduct for the prevention of
for any remuneration other than sitting fees.
Insider Trading in the shares of the Company by
Presently the Company does not have any its Directors and designated employees. The
Scheme for grant of any stock option either to DCW Code, inter-alia, prohibits purchase/
the Directors or to the employees. sale of shares of the Company by the Directors
5. Shareholders’/Investors’ Grievance Committee: and designated employees, while in possession
of unpublished price sensitive information in
Smt. Satyawati Jain, Non-executive Director
relation to the Company. A system has been
is the Chairperson of the Shareholders’/Investors’
put in place and Directors/Designated
Grievance Committee.
Employees have been advised to take pre-
Ms. Kumkum Shah, Asst. Company Secretary is the clearance before purchase/sale of the
Compliance Officer of the Company. Company’s shares.
There were 96 complaints received from the Whistle Blower mechanism is in existence and
shareholders during the year. no personnel has been denied access to the
All the Complaints were resolved satisfactorily. Audit Committee.
There were no pending complaints as on
4. Compliance with Mandatory Requirements:
31.03.2006
The Company has complied with the
6. General Body Meetings:
mandatory requirements of the Code of
(i) Location and time of last 3 Annual General Corporate Governance as stipulated under
Meetings held: Clause 49 of the Listing Agreement with the
Year Location Date Time No. of Special Stock Exchanges.
Resolutions Compliance with Non-Mandatory
Passed Requirements:
2002-03 Dhrangadhra,
(1) The Board:
Gujarat 07.08.2003 11.00 a.m. —
2003-04 Dhrangadhra, The Company has an Executive
Gujarat 12.08.2004 11.00 a.m. 6 Chairman and hence the requirement
2004-05 Dhrangadhra, pertaining to reimbursement of expenses
Gujarat 25.08.2005 11.00 a.m. 1 to a Non-Executive Chairman does not
arise.
(ii) No Special Resolution has been passed last
year through postal ballot. (2) Remuneration Committee:
(iii) No Special Resolution is proposed to be Please refer Item No. 4 under the
conducted through postal ballot. heading ‘Mandatory Requirements’.

LIMITED
(3) Shareholders’ Rights: Financial calendar: April 2006 – March 2007:

As the Company’s Quarterly results are First Quarter results
published in English Newspapers having ending 30th June 2006 : last week of July, 2006
circulation all over India and in a
Gujarati Newspaper circulated in Second Quarter results
Gujarat, the same are not sent to each ending 30th September last week of October,
2006 : 2006
household of shareholders.
(4) Audit qualification: Third Quarter results
ending 31st December last week of January,
The Company move towards a regime of
2006 : 2007
unqualified financial statements.
(5) Training of Board Members: Last Quarter results
ending 31st March last week of April,
The Board of Directors consists of 2007 : 2007
professionals with expertise in their
respective fields and industry. They
Date of Book closure : 27th June, 2006
endeavour to keep themselves updated to 6th July, 2006
with changes in economy and (both days inclusive).
legislation.
(6) Mechanism for evaluating Non- Dividend Payment Date : 10th July, 2006
Executive Board Members:
The performance evaluation of Non- Listing on Stock Exchanges:
Executive Directors is done by the Board The Company’s shares are listed with the following
of Directors, excluding the Director Stock Exchanges:
being evaluated.
Ò The Mumbai Stock – Phiroze Jeejeebhoy Towers,
(7) Whistle Blower Policy: Exchange (BSE) Dalal Street,
The Company has in existence a system Mumbai 400 023
for the employees to report to the
Management about unethical behaviour, Ò National Stock – Exchange Plaza Bldg.,
actual or suspected fraud or violation of Exchange of 5th floor, Plot No. C-1,
the Company’s Code of Conduct. India Limited ‘G’ Block, Bandra-Kurla
(NSE) Complex, Near Wockhardt,
DECLARATION OF COMPLIANCE WITH THE
Mumbai 400 051
CODE OF CONDUCT/ETHICS:
All the Directors and Senior Management Annual Listing fees as prescribed has been paid to
personnel have affirmed compliance with the the above Stock Exchanges for the year 2006-2007.
Code of Conduct/Ethics as approved and GDRs of the Company are listed with the
adopted by the Board of Directors. Luxembourg Stock Exchange.
8. Means of Communication:
Stock Code : 117 (BSE), DCW (NSE)
Ò The Quarterly results are published in
‘Financial Express’ in all editions in India Demat ISIN Nos. : INE 500A01011
including the Gujarati edition published from
Ahmedabad. These are not sent individually to Share Transfers and : Bigshare Services Pvt. Ltd.,
the shareholders. Other Communica- (Unit DCW Ltd.,)
Ò The above results are also displayed on the tions may be E/2, Ansa Industrial Estate,
Company’s web-site viz. www.dcwltd.com Addressed to Sakivihar Road,
Ò There were no presentations made to the Saki Naka,
institutional investors or to the analysts. Andheri (East),
9. General Shareholders information: Mumbai 400 072.
ANNUAL GENERAL MEETING: email: bigshare@sify.com
Ò Day & Date : Thursday, 6th July, 2006
Ò Time : 10.00 a.m. Investors’ complaints : Asst. Company Secretary
Ò Venue at the Registered Office may be DCW Limited
(at Guest House No. 2) , Addressed to Nirmal, 3rd floor,
Dhrangadhra, Nariman Point,
Gujarat - 363 315 Mumbai 400 021

LIMITED
Market price data: Distribution of shareholding as on 31.03.2006:

High/Low During each month in last Financial year : SHAREHOLDERS SHAREHOLDING
No. of Shares
NSE BSE held Nos. % Nos. %
Month/Year High Low High Low 1 - 500 16,407 51.48 46,06,797 2.67
(Rs.) (Rs.) (Rs.) (Rs.)
April, 2005 42.00 36.30 42.25 37.35 501 - 1000 6,113 19.18 53,10,105 3.08
May, 2005 44.80 36.20 44.80 36.15 100 - 2000 3,613 11.33 56,58,378 3.28
June, 2005 48.20 40.05 47.90 40.00 2001 - 3000 2,069 6.49 53,13,440 3.08
July, 2005 45.30 39.15 45.25 39.10
3001 - 4000 701 2.20 25,26,106 1.46
August, 2005 51.25 39.80 50.95 39.70
September, 2005 66.40 9.30 # 66.35 9.30 # 4001 - 5000 1,043 3.27 50,45,782 2.92
October, 2005 11.00 7.70 11.00 7.63 5001 - 10000 970 3.04 74,91,688 4.34
November, 2005 9.50 7.95 9.29 7.94 10001& above 959 3.01 13,65,92,294 79.17
December, 2005 9.60 7.55 9.50 7.61
Total 31,875 100.00 17,25,44,590 100.00
January, 2006 11.00 8.80 11.09 8.75
February, 2006 9.50 8.10 9.50 8.06
Shareholding Pattern as on 31.03.2006:
March, 2006 11.80 7.15 11.90 7.72
Category No. of Percent-
Shares age of
Stock Performance (Indexed): held Share-
The performance of the Company’s shares relative holding
to BSE Sensex is given in the chart below: A. PROMOTERS HOLDINGS
1. PROMOTERS
Companies Associated with
Directors 50,870,463 29.48
Foreign Promoters — —
2. Directors and Relatives 22,930,496 13.29
Sub-total 73,800,959 42.77
B. NON PROMOTERS HOLDING
3. Institutional Investors
a. Mutual Funds and UTI 38,955 0.02
b. Banks, Financial Institution,
Insurance Companies (Central/
State Govt. Institutions/
Non Govt. Institutions 10,768,260 6.24
# Subsequent to sub-division of each equity share of Rs. 10/-
into five equity shares of Rs. 2/- each on 28.9.2005. c. Foreign Institutional
Investors (FIIs) 4,322,600 2.51
Registrar and Share Transfer Agents: Sub-total 15,129,815 8.77
The Company has appointed Bigshare Services Pvt.
4. OTHERS
Ltd., E/2, Ansa Industrial Estate, Sakivihar Road, Saki
Naka, Andheri (East), Mumbai 400 072 as Registrars a. Private Corporate Bodies 9,276,054 5.38
and Share Transfer Agents of the Company. b. Indian Public 57,758,675 33.47
The Company’s shares are traded in the Stock c. NRI’s / OCBs 11,509,863 6.67
Exchanges compulsorily under demat mode. All the d. Any other
applications received for transfer of physical shares Foreign Banks 44,725 0.03
are approved by the Share Transfer Committee,
which normally meets twice in a month depending GDR’s 3,498,750 2.03
on the volume of transfers. Share transfers are Shares in transit 1,525,741 0.88
registered and returned normally within 20 days
Sub Total 83,613,816 48.46
from the date of lodgement, if documents are
complete in all respects. Grand Total 172,544,590 100.00

LIMITED
Dematerialisation of shares: 16,01,08,805 Equity shares Outstanding GDRs /ADRs/Warrants /convertible

held by 22,251 Shareholders comprising 92.79% of the instruments etc.:
paid up Share Capital have been dematerialised as on Outstanding GDRs as on 31st March, 2006 represent
31st March, 2006. 34,98,750 shares (2.02%). There are no further
outstanding instruments, which are convertible into
equity in the future.
Plant Location:
Given in the 1st page of this Annual Report
Address for correspondence:

DCW Limited, Nirmal, 3rd floor,
Nariman Point, Mumbai - 400 021
Certificate on Clause 49 Compliance
The Board Of Directors

DCW LIMITED
I have reviewed the records concerning the Company’s furnished to me for the review, and the information and
compliance of conditions of Corporate Governance as explanations given to me by the Company.
stipulated in Clause 49 of the Listing Agreement entered into,
by the Company, with the Stock Exchanges of India, for the Based on such a review, in my opinion, the Company has
financial year ended 31st March, 2006. complied with the conditions of Corporate Governance, as
stipulated in Clause 49 of the said Listing Agreements.
The compliance of conditions of Corporate Governance is the
responsibility of the management. My examination was limited I further state that, such compliance is neither an assurance as
to procedures and implementation thereof, adopted by the to the future viability of the Company, nor as to the efficiency
Company for ensuring the compliance of the conditions of the or effectiveness with which the management has conducted
Corporate Governance. It is neither an audit nor an expression the affairs of the Company.
of opinion on the financial statements of the Company.
Sridhar Narayanan
I have conducted my review on the basis of the relevant Place: Mumbai Company Secretary
records and documents maintained by the Company and Date: 23rd May, 2006 C.P. No. 2423

Annexure to the
LIMITED Directors’ Report
STATEMENT CONTAINING PARTICULARS PURSUANT TO THE COMPANIES (DISCLOSURE OF PARTICULARS IN THE REPORT
OF BOARD OF DIRECTORS) RULES, 1988 AND FORMING PART OF THE DIRECTORS REPORT.
A. CONSERVATION OF ENERGY :
1. Supermizers, the electronic device to reduce energy consumption in three phase induction motors, are being used
continuously in all plants to save energy. So far, 236 supermizers have been installed resulting in saving of 43 lacs unit
during the year.
2. Asia E+ tube lights are energy efficient with longer life and high lumens. Each tube consumes 28 watts, compared to
conventional tube lights which consumes 53 watts. DCW continues the conversion programme in phase manner to replace
inefficient tube lights. Also, inefficient mercury and sodium vapor-lamps were replaced by highly efficient metal halide
lamps. Annual energy saving to a tune of 6.4 lacs units is achieved.
3. Energy audit on all the motors of capacity 30 KW and above was carried out and energy conservation to a tune of 45,000
units have been achieved by installation of energy efficient motors.
4. For effective utilization of hydrogen available from caustic soda plant, dual burner was installed in calciner in Ilmenite
plant at cost of Rs. 25 Lacs.
5. So far, 9 nos. of cooling towers have been installed and annual energy savings to a tune of 12 lacs units is achieved.
6. In-house cost improvements are conducted periodically where mostly energy saving proposals are given by all departments
for implementation. During the year under report, 3 programmes were conducted and 49 suggestions resulting in annual
savings to the tune of Rs. 60 Lacs have been implemented.
B. TECHNOLOGY ABSORPTION :
Research and Development:
1.1 BENEFICIATED ILMENITE AREA:
1.1.1. Process optimization to reduce cycle time and acid consumption in BI process.
High pressure leaching implemented in all digesters resulting in reduction on acid consumption and cycle time by
about 30%. To further reduce acid consumption and subsequently the effluent, possibility of preheating of acid
being explored.
1.1.2 Capacity enhancement of Ore Purification Plant
The capacity of ore purification plant was increased by adding High Tension Plate Separators. This will cater to the
needs of BI production and also for reprocessing of rejects.
1.2 IRON OXIDE AREA

1.2.1. Trials with ammonia in place of caustic lye
Plant scale trails were carried out using air / oxygen for seed and crystal reaction. Also trials with ammonia (in place
of caustic lye) carried out, to develop new process for making yellow iron oxide. The modified process will yield
two products viz. Yellow Iron Oxide and Calcium Chloride while ammonia will be recovered and recycled.
1.2.2. Trials in test unit for selection of equipment for commercial scale plant
Filtration and drying trails with prototype equipments carried out to decide requirements for commercial scale
plant.
1.3. CAUSTIC SODA AREA

1.3.1. Modernisation of cells in phased manner continued. During the year under report, 10 cells have been completed.
1.3.2. New chilling system for hydrogen was installed with an investment of Rs. 12 Lacs to improve hydrogen efficiency,
1.4. PVC
1.4.1. By in-house re engineering effort, reduction of Inputs (VCM, steam, power etc) for making PVC resin was achieved
and annual savings to a tune of Rs. 75 Lacs achieved.
1.4.2. The capacity of Fluid Bed Dryer was increased from its design capacity of 120 TPD to 200 TPD by in-house
modification and debottlenecking.
1.5 CPP
1.5.1. The electrical heaters were partially replaced by steam heaters, resulting in annual savings of 2.6 lacs units.
1.5.2. In place of RO water, Water softener plant was installed for cooling towers. Annual savings of Rs. 33 Lacs achieved.
1.5.3. To improve engine performance, marine type filters were replaced by oil bath type.

LIMITED
2. EXPENDITURE ON RESEARCH & DEVELOPMENT:

(i) Capital Rs. 80.84 lacs
(ii) Recurring Rs. 6.67 lacs
Rs. 87.51 lacs
(iii) Total Research & Development Expenditure as a percentage of total turnover (Net of Excise) : 0.14 percentage.
Technology Absorption, Adaptation and Innovation :
Continuos efforts are made towards technology absorption, adaptation and innovation. The emphasis is on improving the
quality of the finished product and reducing energy consumption.
C. FOREIGN EXCHANGE EARNINGS AND OUTGO
Particulars regarding foreign exchange earnings and outgo appear in Schedule 6 forming part of the Profit and Loss Account.
REQUISITE DATA IN RESPECT OF ENERGY CONSUMPTION
(A) Power and Fuel Consumption
Caustic Soda Unit PVC Unit Soda Ash Unit

Particulars Current Previous Current Previous Current Previous
Year Year Year Year Year Year
2005-2006 2004-2005 2005-2006 2004-2005 2005-2006 2004-2005
1. ELECTRICITY
(a) Purchased
Unit (Lakh Kwh) — 0.19 3.03 2.79 21.90 44.84
Total Amount
(Rs. In Lakhs) — 14.23 21.46 20.31 112.22 231.25
Rate/Unit (Rs.) — *73.71 7.09 7.29 5.12 5.16
(b) Own Generation
(i) Through Diesel
Generator
Unit (Lakh Kwh) 2,034.23 2,078.02 185.34 180.25 — —
Unit/ltr of
LSHS/Diesel Oil 4.43 4.39 4.43 4.39 — —
Cost/Unit (Rs.) 3.86 3.14 3.89 3.14 — —
(ii) Through Steam
Turbine Generator
Unit (Lakh Kwh) — — — — 258.57 238.41
Unit/ltr of Fuel — — — — — —
Oil/Gas
Cost/Unit (Rs.) — — — — — —
2. Coal (specify quality and
where used) — — — — — —
Total cost — — — — — —
Average rate — — — — — —
3. FURNACE OIL/LSHS/LSFO/
ADDTITIVE
Quantity (Kl) 50,074.03 51,417.31 4,072.07 3,335.55 — —
Total Amount 8,007.41 5,387.25 588.04 349.86 — —
(Rs. in Lakhs)
Average Rate (Rs.) 13,911.73 10,189.80 14,440.89 10,488.75 — —
4. OTHERS
(i) Hydrogen
Quantity (MT) 194.840 450.514 — — — —
Total Amount 72.075 130.89 — — — —
(Rs. in lakhs)
Rate/Unit (Rs.) 36,991.683 29,053.48 — — — —
(ii) Lignite
Quantity (MT) — — — — 114095 108558
Total Amount — — — — 1602.97 1377.84
(Rs. in Lakhs)
Rate/Unit (Rs.) — — — — 1405 1269
(iii) HSD
Quantity (MT) 21.98 19.09 4.51 8.36 — —
Total Amount 7.78 12.10 1.59 5.17 — —
(Rs. in lakhs)
Rate/Unit (Rs.) 35386.75 63,397.40 35,386.75 63,397.40 — —
*Inclusive of Fixed Minimum demand charges per KVA to be paid irrespective of drawal of Power.

LIMITED
Caustic Soda Unit PVC Unit Soda Ash Unit

Particulars Current Previous Current Previous Current Previous
Year Year Year Year Year Year
2005-2006 2004-2005 2005-2006 2004-2005 2005-2006 2004-2005
(B) Consumption per unit

of Production
Electricity (Kwh) 3002 3005 226 233.00 243.00 240.00

Fuel Oil (MT) 0.20 0.083 0.052 0.083 — —
– Hydrogen (Kgs.) 9.73 21.90 — — — —
– LSHS (MT) — — — — — —
– Lignite (MT) — — — — 0.908 0.898
– HSD (Litre) 0.0001 0.0001 — — — —
Annexure to the Directors’ Report

Information as per Section 217(2A) of the Companies Act, 1956, read with the Companies
(Particulars of Employees) Rules, 1975 and forming part of the Directors’ Report
Sr. Name Designation/ Remune- Qualification Experience Date of Age Last employment held.
No. Nature of Duties ration commence- Name of the Company,
ment of Designation
Employment and Period of Service
(Rupees) (Years) (Years)
Employed for whole of the year

1 Dr. Shashi Chand Jain Chairman & 5,087,460 Ph.D (Economics) 50 01.04.1969 73 Sahu Brothers (Saurashtra)
Managing Director Pvt. Ltd.
Director - 11 years
2 Shri Sharad Kumar Jain Vice Chairman & 7,100,448 B.A. (Hons.) Economics 48 01.04.1969 71 Sahu Brothers (Saurashtra)
Managing Director Pvt. Ltd.
Director - 11 years
3 Shri Pramod Kumar Jain Managing Director 5,114,584 B.A. (Hon.) Economics 47 01.04.1969 68 Sahu Brothers (Saurashtra)
Pvt. Ltd.
4 Shri Bakul Jain Executive Director 5,086,762 B.Com., MBA 22 01.09.1984 51 —
Employed for part of the year
1 Shri G. Raman Executive 1,861,622 S.S.L.C. 51 01.04.1954 77 Dalmia Cement & Paper
Vice President Marketing Co. Ltd.
(Foreign Trade)
2 Shri B. M. Mulla General Manager 998,229 M.A. 31 10.11.1975 61 —

(Public Relation)
3 Shri Murugan S. Sr. Engineer 215,534 B.E. (Electrical) 12 20.01.1993 39 Southern Railway, Trichy
(Electrical)
4 Shri A. Leo Joseph Sr. Engineer 420,794 B.Sc. 35 02.05.1970 58 —
(Quality Control —
Lab.)
5 Shri S. Selvaraj Sr. Officer (Stores) 352,440 B.Sc. 35 07.11.1970 58 —
Notes :
1. The gross remuneration shown above (subject to tax) comprise salary, perquisites, Company’s contribution to Provident Fund , Superannuation
Fund and Gratuity Fund.
In case of Managing Directors & Executive Director, the Remuneration also includes Commission.
2. The nature of employment of the Managing Directors & the Executive Director is contractual.
3. Dr. Shashi Chand Jain, Shri Sharad Kumar Jain and Shri Pramod Kumar Jain - Managing Directors and Shri Bakul Jain - Executive Director, are
related to Smt. Satyawati Jain - Director of the Company.

Balance Sheet LIMITED
AS AT 31ST MARCH, 2006

As at As at
31/03/2006 31/03/2005
US $ in Millions* US $ in Millions#
SOURCES OF FUNDS
Shareholders’ Funds :
Capital 7.73 7.89
Reserves and Surplus 46.25 42.44
Loan Funds :
Secured Loans 29.12 16.37
Unsecured Loans 0.01 0.02
Deferred Tax Liability:
Deferred Tax Liability 14.06 12.93
Deferred Tax Asset (1.58) (1.55)
12.48 11.38
TOTAL 95.59 78.10
APPLICATION OF FUNDS
Fixed Assets :
Gross Block 134.39 119.32
Less : Depreciation 63.89 61.42
70.50 57.90
Capital Work-in-progress 6.95 8.10
77.45 66.00
Investments 2.49 0.19
Current Assets, Loans and Advances :
Inventories 27.07 18.25
Sundry Debtors 11.42 11.24
Cash and Bank Balances 0.83 0.84
Loans and Advances 12.50 11.35
51.82 41.68
Less: Current Liabilities and Provisions
Liabilities 33.51 28.02
Provisions 2.66 1.75
36.17 29.77
Net Current Assets 15.65 11.91
TOTAL 95.59 78.10
* One US $ = Rs. 44.63

# One US $ = Rs. 43.75

LIMITED Profit and Loss Account
FOR THE YEAR ENDED 31ST MARCH, 2006
For the year ended For the year ended
31/03/2006 31/03/2005
US $ in Millions* US $ in Millions#
INCOME
Sales (including Excise Duty) 157.65 168.21

Less: Excise Duty 21.49 21.61
136.16 146.60
Other Income 5.36 2.12

141.52 148.72
EXPENDITURE
Manufacturing and Other Expenses 128.33 138.39

Interest & Finance Charges 0.79 0.16
129.12 138.55
Profit before Depreciation 12.40 10.17
Depreciation 5.17 4.74
Profit Before Tax 7.24 5.43
Provision for Tax

Current Tax 0.62 0.39
Fringe Benefit Tax 0.09 —
MAT Credit available for set off (0.61) —
Tax Adjustment of Previous Year (0.29) —
Profit after Current Tax & Tax Adjustments 7.43 5.04
Deferred Tax 1.32 0.22

Profit After Deferred Tax 6.11 4.82
Add : Surplus brought forward from last year 6.49 5.17
12.60 9.99
APPROPRIATION
Transfer to General Reserve 4.48 2.29

Proposed Dividend on Equity Shares 1.16 0.95
Tax on Dividend 0.17 0.12
Profit Carried Forward 6.79 6.63
* One US $ = Rs. 44.63

# One US $ = Rs. 43.75

Key Financial Data LIMITED
2005-2006 2004-2005
Rs. in US $ in Rs. in US $ in
Millions Millions* Millions Millions#
Gross Sales 7,035.88 157.65 7,359.07 168.21
Fixed Assets – Gross Block 5,997.85 134.39 5,220.05 119.32
Net Block 3,456.58 77.45 2,887.26 65.99
Export Earnings 673.62 15.09 721.41 16.49
Earnings Before Depreciation and Interest 588.59 13.19 451.42 10.32
Interest 35.08 0.79 7.19 0.16
Earnings Before Depreciation 553.51 12.40 444.23 10.15
Depreciation 230.56 5.17 207.45 4.74
Earnings Before Tax 322.95 7.24 236.78 5.41
Taxation
Current 27.75 0.62 17.00 0.39
Fringe Benefit Tax 4.00 0.09 — —
MAT Credit available for set off (27.24) (0.61) — —
Tax adjustment of previous year (13.00) (0.29) — —
Deferred Tax 58.74 1.32 9.45 0.22
Earnings After Tax 272.70 6.11 210.33 4.81
No. of shares of Rs. 2/- each

(Million Nos.) @ 172.54 172.54 172.54 172.54
Earnings per Share 1.58 0.04 1.22 0.03
Net Worth (Excl. Revaluation Reserve) 2,277.16 51.02 2,063.84 47.17
Book value per share 13.20 0.30 11.96 0.27
Gross profit to sales (%) 7.87 7.87 6.04 6.04

(Earnings Before Depreciation)
Interest coverage Ratio 16.78 16.78 62.78 62.78
Debt/Equity 0.64:1 0.64:1 0.33:1 0.33:1
Current Assets/Current Liabilities 1.43 1.43 1.40 1.40
@ Each Equity Share of Rs. 10 has been sub-divided into five Equity Shares of Rs. 2 each, hence all related references for the previous
periods have been restated for the sake of comparability.
* 1 US $ = Rs. 44.63
# 1 US $ = Rs. 43.75

LIMITED Auditor’s Report
AUDITOR’S REPORT TO THE sub-section (4A) of Section 227 of the that none of the Directors is
SHAREHOLDERS OF DCW LIMITED Companies Act, 1956, we enclose in disqualified as on 31st March
the Annexure a statement on the 2006 from being appointed as
1. We have audited the attached matters specified in paragraphs 4 and a Director in terms of clause (g)
Balance Sheet of DCW Limited as at 5 of the said Order. of sub-section (1) of Section 274
31st March, 2006 and also the Profit of the Companies Act, 1956;
and Loss Account and Cash Flow 4. Further to our comments in the
Statement of the Company for the Annexure referred to in paragraph 3 (vi) In our opinion and to the best
year ended on that date, annexed above, we report that: of our information and
thereto. These financial statements according to the explanations
(i) We have obtained all the
are the responsibility of the given to us, the said accounts
information and explanations,
Company’s Management. Our subject to Note No.B-17 of
which to the best of our
responsibility is to express an opinion Schedule ‘N’ to the Accounts,
knowledge and belief, were
on these financial statements based which has the effect of not
necessary for the purposes of our
on our audit. disclosing the respective
audit;
2. We conducted our audit in liabilities/assets indicated
accordance with auditing standards
(ii) In our opinion, proper books of therein and showing the total
generally accepted in India. Those
account as required by law, assets and total liabilities lesser
Standards require that we plan and
have been kept by the Company to the extent of Rs. 501.16 lacs,
so far as appears from our and read with the Significant
perform the audit to obtain
examination of those books; Accounting Policies and other
reasonable assurance about whether
notes thereon, give the
the financial statements are free of (iii) The Company’s Balance Sheet,
information required by the
material misstatement. An audit Profit and Loss Account and
Companies Act, 1956 in the
includes examining, on a test basis, Cash Flow Statement dealt with
manner so required and give a
evidence supporting the amounts and by this Report are in agreement
true and fair view in conformity
disclosures in the financial with the books of account;
with the accounting principles
statements. An audit also includes
(iv) In our opinion, the Balance generally accepted in India:
assessing the accounting principles
used and significant estimates made Sheet, Profit and Loss Account
(a) In the case of the Balance
by management, as well as evaluating and Cash Flow Statement dealt
Sheet, of the state of affairs
the overall financial statement with by this report comply with
of the Company as at
presentation. We believe that our the Accounting Standards
31st March, 2006,
audit provides a reasonable basis for referred to in sub-section (3C)
our opinion. of Section 211 of the Companies (b) In the case of the Profit and
Act, 1956, to the extent Loss Account, of the profit
3. As required by the Companies applicable; for the year ended on that
(Auditor’s Report) Order, 2003 and date, and
read together with the Companies (v) On the basis of written
(Auditor’s Report) Amendment Order, representations received from (c) In the case of the Cash
2004 (hereinafter referred to as the the Directors as on 31st March, Flow Statement of the cash
Order) issued by the Central 2006, taken on record by the flows for the year ended on
Government of India in terms of Board of Directors, we report that date.
For V. Sankar Aiyar & Co.,

Chartered Accountants.
S. Venkatraman
Place : Mumbai Partner
Dated : 23rd May, 2006 Membership No. 34319

LIMITED
ANNEXURE REFERRED TO IN the size of the Company and (b) Sub-clause (b) of sub-para (v)
PARAGRAPH 3 OF AUDITOR’S REPORT the nature of its business. of para 4 of the Order is not
TO THE SHAREHOLDERS OF DCW (c) In our opinion, the Company applicable as there are no
LIMITED ON THE ACCOUNTS FOR THE is maintaining proper records such transactions exceeding
YEAR ENDED 31ST MARCH 2006. of inventories and no the value of Rupees Five Lacs
material discrepancies were in respect of any party in the
i. (a) The Company has noticed on physical financial year.
maintained proper records, verification as compared to vi. In our opinion and according to
except in respect of Pantape the record of inventories. the information and explanations
Division, showing particulars given to us, the Company has
including quantitative details iii. Based on the audit procedures complied with the provisions of
and situation of fixed assets. applied by us and according to the the Sections 58A, 58AA and other
information and explanations relevant provisions of the
(b) We are informed that the given to us, the Company has not Companies Act, 1956 and the rules
fixed assets, except in respect granted or taken any loans, framed thereunder, with regard to
of Pantape Division, have secured or unsecured, to/from deposits accepted from the public.
been physically verified by companies, firms or other parties
the Management with the We are informed by the
listed in the register maintained
assistance of external Management that no order has
under Section 301 of the
agencies during the year. In been passed by the Company Law
Companies Act, 1956.
our opinion the frequency of Board or National Company Law
verification is reasonable. As iv. In our opinion and according to Tribunal or Reserve Bank of India
per the information given to the information and explanations or any Court or any other Tribunal
us by the management, no given to us, having regard to the under Sections 58A and 58AA of
material discrepancies as explanation that for purchase of the Companies Act, 1956.
compared to book records certain raw materials, stores, and vii. The Company has, in general, an
were noticed in respect of components, alternative sources of internal audit system com-
fixed assets verified during supply are limited with reference mensurate with the size and nature
the year. to quality, delivery schedules, of the Company’s business.
credit period and some of the items
viii. We have broadly reviewed the
(c) Since there is no disposal of a purchased are of special nature,
books of account maintained by
substantial part of fixed assets and hence comparable alternative
the Company pursuant to the rules
during the year, the quotations are not available for
made by the Central Government
preparation of financial these, there are adequate internal
for the maintenance of cost
statements on a going control procedures commensurate
records under Section 209(1)(d) of
concern basis is not affected with the size of the Company and
the Companies Act, 1956 and are
on this account. the nature of its business for the
of the opinion that, prima facie,
purchase of inventories and fixed
ii. (a) The inventories of finished the prescribed accounts and
assets and for the sale of goods and
goods (except goods lying records have been made and
services. During the course of our
with consignees and in maintained. We have not,
audit, we have not observed any
transit), stores, spare parts however, made a detailed
continuing failure to correct major
and raw materials have been examination of these records with
weaknesses in the internal control
physically verified by the a view to determine whether they
system.
management with the help of are accurate or complete.
external agencies. In our v. (a) Based on the audit pro- ix. (a) According to the records of
opinion, the frequency of cedures applied by us, to the the Company, undisputed
physical verification is best of our knowledge and statutory dues including
reasonable. belief and according to the provident fund, investor
information and explanations education and protection
(b) In our opinion, the given to us, particulars of fund, employees’ state
procedures of physical contracts or arrangements insurance, income tax, sales
verification of inventories referred to in Section 301 of tax, wealth tax, service
(except finished goods lying the Companies Act, 1956, tax, custom duty, excise
with consignees and in have been entered in the duty, cess and other material
transit) followed by the register required to be statutory dues that are
management are reasonable maintained under that required to be deposited
and adequate in relation to Section. regularly with authorities,

LIMITED
have generally been regularly x. The Company does not have any Therefore the provisions of sub-
deposited with the accumulated losses at the end of para (xiii) of para 4 of the Order are
appropriate authorities. the financial year. The Company not applicable to the Company.
According to the information has not incurred any cash losses
and explanations given to us, during the financial year covered xiv. In respect of shares, securities
no undisputed amounts in by our audit and the immediately and other investments dealt
respect of the aforesaid preceding financial year. in or traded by the Company,
statutory dues were in proper records have been
arrears, as at 31st March, xi. On the basis of verification of maintained of the transactions and
2006, for a period of more records and according to the contracts and timely entries have
than six months from the date information and explanations been made therein. All the
they became payable. given to us, the Company has not investments are held by the
defaulted in repayment of dues to Company in its own name except
Financial Institutions/Banks or to the extent of the exemption
(b) According to the information granted under section 49 of the
Debenture holders.
and explanations given to us Companies Act, 1956.
and the records of the xii. The Company has not granted any
Company, the dues of sales loans and advances on the basis of xv. According to the information and
tax/income tax/customs duty/ security by way of pledge of explanations given to us, the
wealth tax/service tax/ excise shares, debentures and other Company has not given any
duty/cess, which have not securities. guarantee for any loans taken by
been deposited on account of xiii. The Company is not a chit fund or others from any bank or financial
any dispute are as follows: a nidhi or a mutual benefit society. institution.
(Rs. in lacs)
Name of the Statute/ Period Forum where Dispute is pending

Nature of Dues
Supreme High Appellate Appellate State Grand
Court Court Tribunal* Authority** Govern- Total
ment
Customs Act, 1962 (Customs Duty 1998 to 2005 — 31.26 — — — 31.26
Including Penalty & Interest,
wherever applicable)
Central Excise Act, 1944 (Excise Duty 1977 to 2005 — 2.98 280.34 5.80 — 289.12
Including Penalty & Interest,
Sales Tax Legislations 1982 to 2000 — 2.57 414.59 178.94 — 596.10

(Sales Tax, including Penalty
& Interest, wherever applicable)
Local cess, Local cess surcharge 1989 to 2006 — 57.82 — — 12.69 70.51
(Land Revenue Including
Penalty and Interest,
Grand Total — 94.63 694.93 184.74 12.69 986.99
* Appellate Tribunal includes STAT, CESTAT and ITAT
** Appellate Authority includes Commissioner Appeals, Assistant Commissioner Appeals, Deputy Commissioner Appeals, Joint
Commissioner Appeals and Deputy Commissioner Commercial Taxes Appeals.

LIMITED
xvi. In our opinion, the term loans prima facie, not been used during security or charge in respect
taken during the year have, prima the year for long-term investment. thereof does not arise.
facie, been applied for the purpose xx. The Company has not made any
for which they were raised. xviii. The Company has not made any public issue of any securities
preferential allotment of shares during the year and therefore the
during the year to parties and question of disclosing the end-use
xvii. According to the information and
companies covered in the register of money raised by any public
explanations given to us, based on
maintained under section 301 of issue does not arise.
an overall examination of the
the Companies Act, 1956. xxi. We are informed that during the
balance sheet of the Company,
related information made year, no instances of material fraud
available to us and as represented xix. The Company has not issued any on or by the Company have been
to us by the Management, funds debentures during the year and noted or reported by the
raised on short-term basis have, therefore the question of creating management.
For V. Sankar Aiyar & Co.,

Chartered Accountants.
S. Venkatraman
Place : Mumbai Partner
Dated : 23rd May, 2006 Membership No. 34319

LIMITED Balance Sheet
AS AT 31ST MARCH, 2006
Schedule As at As at
31/03/2006 31/03/2005
Rs. in lacs Rs. in lacs
SOURCES OF FUNDS
Shareholder’s Funds :
Capital A 3,450.89 3,450.93
Reserves and Surplus B 20,642.56 18,567.99
Loan Funds :
Secured Loans C 12,994.14 7,163.52
Unsecured Loans D 6.15 6.94
Deferred tax liability :
(Refer Note B–5 of Schedule–N)
Deferred tax liability 6,274.69 5,658.48
Less : Deferred tax asset (706.59) (677.81)
5,568.10 4,980.67
18,568.39 12,151.13
TOTAL 42,661.84 34,170.05
APPLICATION OF FUNDS
Fixed Assets :
Gross Block E 59,978.52 52,200.45
Less : Depreciation 28,512.44 26,872.09
31,466.08 25,328.36
Capital Work-in-progress 3,099.68 3,544.26
34,565.76 28,872.62
Investments F 1,109.95 85.01
Current Assets, Loans and Advances
Inventories G 12,083.48 7,985.59
Sundry Debtors H 5,096.31 4,919.30
Cash and Bank Balances I 369.31 366.38
Loans and Advances J 5,580.55 4,964.16
23,129.65 18,235.43
Less : Current Liabilities and Provisions
Liabilities K 14,956.61 12,136.22
Provisions L 1,186.91 886.79
16,143.52 13,023.01
Net Current Assets 6,986.13 5,212.42
Contingent Liabilities not provided for M
Significant Accounting Policies and N
Notes forming part of
Balance Sheet and Profit and Loss Account
TOTAL 42,661.84 34,170.05
As per our Report attached

For and on behalf of the Board
For V. Sankar Aiyar & Co. Dr. Shashi Chand Jain Smt. Satyawati Jain
Chartered Accountants Chairman & Managing Director
Dr. V. H. Joshi
S. Venkatraman Bakul Jain Yuvraj Saheb of Dhrangadhra
Partner Executive Director
Sushil Kumar Jalan
Directors
Place : Mumbai Kumkum Shah T. M. Bhandari
Date : 23rd May, 2006 Asstt. Company Secretary Sr. Vice President (Finance)

Profit and Loss Account LIMITED
FOR THE YEAR ENDED 31ST MARCH, 2006

Schedule For the year ended For the year ended
31/03/2006 31/03/2005
INCOME
Sales ‘1’ 70,358.82 73,590.72
Less: Excise Duty (9,591.46) (9,455.38)
Net Sales 60,767.36 64,135.34
Other Income ‘2’ 2,391.34 925.36
63,158.70 65,060.70
EXPENDITURE
Manufacturing and Other Expenses ‘3’ 57,272.81 60,546.54
Interest & Finance Charges (Net) ‘4’ 350.84 71.91
57,623.65 60,618.45
Depreciation ‘5’ 2,305.56 2,074.46
59,929.21 62,692.91
Profit before tax 3,229.49 2,367.79
Current Tax 277.49 170.00
Fringe Benefit Tax 40.00 —
MAT Credit Available for set off (272.35) —
Tax Adjustment of Previous Year (130.00) —
Profit after Current Tax & Tax Adjustments 3,314.35 2,197.79
Deferred Tax (Refer Note B-5 of Schedule N) 587.43 94.46
Profit after Deferred Tax 2,726.92 2,103.33
Add : Surplus brought forward from last year 2,894.90 2,259.87
Available for appropriation 5,621.82 4,363.20
APPROPRIATION
Transfer to General Reserve 2,000.00 1,000.00
Proposed Dividend on Equity Shares 517.63 414.16
2,594.06 1,468.29
Profit Carried Forward 3,027.76 2,894.91
Notes to Profit & Loss Account ‘6’

Weighted average number of Equity Shares
outstanding during the year * 17,25,44,590 17,25,66,670
Basic and diluted earning per share Rs. 1.58 Rs. 1.22
*(Each Equity Share of Rs. 10 has been sub-divided into five Equity Shares of Rs. 2 each, hence all related references for the previous
periods have been restated for the sake of comparability).

Dr. V. H. Joshi
Sushil Kumar Jalan
Directors

LIMITED
CASH FLOW STATEMENT FOR THE YEAR ENDED 31st MARCH, 2006
2005-06 2004-05
Rs in lacs Rs in lacs
A. Cash flow from Operating Activities

Net profit before tax and extraordinary items 3,229.49 2,367.80
Adjustments for:
Non-cash items (1,018.83) 32.04
Depreciation 2,305.56 2,074.46
Interest (net) 350.84 71.91
Dividend income (61.07) 1,576.50 (39.45) 2,138.96
Operating profit before working capital changes 4,805.99 4,506.76
Adjustments for:
Trade and other receivables (521.05) (4,266.54)
Inventories (4,097.89) 1,661.71
Current liabilities and provisions 3,059.34 (1,559.60) 229.82 (2,375.01)
Cash generation from operations 3,246.39 2,131.75
Direct taxes paid (229.34) 129.64
Cash flow before Extraordinary items 3,017.05 2,261.39
Extraordinary items — —
Net Cash flow from Operating Activities 3,017.05 2,261.39
B. Cash flow from Investing Activities

Purchase of Fixed Assets (8,594.93) (4,276.50)
Sale of Fixed Assets 1,806.94 60.12
Purchase/Sales of Investments (1,008.12) (23.44)
Dividend Income 61.07 39.45
Interest Income 355.65 257.59
Net cash used in investing Activities (7,379.39) (3,942.78)
C. Cash from Financing Activities

Proceeds from issue of share capital (0.04) 0.17
Repayment of loans (1,390.38) (186.24)
Repayment of Other Borrowings (137.81) (331.19)
Proceeds from Long Term Borrowings 7,358.02 3,221.64
Interest paid (996.65) (570.81)
Dividend paid (409.91) (345.13)
Tax on dividend (57.96) (44.22)
Net cash used in Financing Activities 4,365.27 1,744.22
Net increase in Cash and Cash equivalents 2.93 62.83
Cash & Cash Equivalents as at 1st April 2005 366.38 303.55
Cash & Cash Equivalents as at 31st March 2006 369.31 366.38
2.93 62.83

Dr. V. H. Joshi
Sushil Kumar Jalan
Directors

Schedules LIMITED
FORMING PART OF THE BALANCE SHEET

As at As at
31/03/2006 31/03/2005
SCHEDULE “A”
SHARE CAPITAL
Authorised Capital
17,50,00,000 Equity Shares of Rs. 2/- each
(Previous Year 3,50,00,000 Equity Shares @ Rs. 10 each) 3,500.00 3,500.00
TOTAL 3,500.00 3,500.00
ISSUED, SUBSCRIBED AND PAID-UP CAPITAL
17,25,44,590 Equity Shares of Rs. 2/- each

(Previous Year 3,45,13,334 Shares @ Rs. 10 each) 3,450.89 3,451.33
Less : Calls in Arrears — 0.40
TOTAL 3,450.89 3,450.93
Notes
Of the Equity Shares
(1) The following Shares were allotted as fully paid-up without payment being received in cash:
(a) 5,25,000 (P.Y. 1,05,000 shares of Rs. 10 each) Shares to Vendors.
(b) 4,550 (P.Y. 910 shares of Rs. 10 each) Shares to Equity Shareholders of the erstwhile, PRC Limited, pursuant to the
amalgamation with the Company.
(2) 3,74,50,985 (P.Y. 74,90,197 shares of Rs. 10 each) Shares were allotted as fully paid-up Bonus Shares by Capitalisation of
Capital Redemption Reserve, Share Premium Account and General Reserve.
(3) 2,66,66,550 (P.Y. 53,33,310 shares of Rs. 10 each) Shares were issued and allotted consequent to conversion of Part A of the
26,66,655 Partly Convertible Debentures allotted in April 1992.
(4) 4,61,25,000 (P.Y. 92,25,000 shares of Rs. 10 each) Shares were issued in 1994-95 against which Global Depository Receipts
were issued by the Depository viz. Citibank, U.S.A.
(5) 2,80,94,525 (P.Y. 56,18,905 shares of Rs. 10 each) Shares were issued and allotted pursuant to Rights issue made during
2000-01.
(6) During the year 22,080 equity shares of Rs. 2 each (4,416 shares of Rs. 10 each) were forfeited on account of calls in arrears.

LIMITED Schedules
As at As at
31/03/2006 31/03/2005
SCHEDULE “B”
RESERVES AND SURPLUS
CAPITAL RESERVE
As per last balance sheet 355.83 355.61
CAPITAL REDEMPTION RESERVE

SHARE PREMIUM
As per last balance sheet 7,079.70 7,079.70
REVALUATION RESERVE
Less : Transferred to Profit and Loss Account 58.50 58.57
1,321.88 1,380.38
GENERAL RESERVE
Add : Transfer from P&L account 2,000.00 1,000.00
Add : Transfer from Debenture Redemption Reserve — 30.00
Add : Forfeiture of Debentures — 4.24
8,801.04 6,801.04
CONTRIBUTION FOR CAPITAL EXPENDITURE

PROFIT AND LOSS ACCOUNT 3,027.76 2,894.91

TOTAL 20,642.56 18,567.99

Schedules LIMITED

As at As at
31/03/2006 31/03/2005
SCHEDULE “C”
SECURED LOANS
Banks
Term loans 7,688.24 3,113.50
Working Capital Loans 198.76 335.32
Other Loans
Financial Institutions 2,857.14 3,714.29
Term Loans from NBFC 2,250.00 0.41

TOTAL 12,994.14 7,163.52
Notes :
Loans Secured by
Banks Working Capital facilities are secured by a first charge by way of hypothecation and/or pledge of current assets,
namely, stocks of materials, semi-finished and finished goods, consumable stores and spares including machinery
spares not capitalised, bills receivable and book debts and further secured by a second charge by way of hypothecation
over all of movable plant and machinery and by way of mortgage by deposit of title deeds over the immovable
properties, both present and future, such mortgage to rank second to the mortgages created in favour of Financial
Institutions/Debentures Trustees.
Term Loans from Banks are secured by a pari-passu first charge by way of hypothecation of movable assets of the
Company.
Other loans The Long Term Working Capital Loan from a Financial Institution is secured by creation of first pari passu charge
on all the movable fixed assets, both present and future by way of hypothecation and further secured on first
pari- passu charge by mortgage on all the immovable properties situated in the states of Tamilnadu and Gujarat.
Equipments Finance Loan from a Financial Institution and term loan from NBFC are secured by creation of first
pari-passu charge on all the movable fixed assets, both present and future by way of hypothecation.
As at As at
31/03/2006 31/03/2005
SCHEDULE “D”
UNSECURED LOANS
OTHERS
Deferred Sales Tax Credit 6.15 6.94

TOTAL 6.15 6.94
Due within one year Rs. 0.61 lacs (Previous Year Rs. 1.30 lacs)

28
Schedules
FORMING PART OF THE BALANCE SHEET LIMITED
SCHEDULE “E”
FIXED ASSETS
Rs. in lacs
GROSS BLOCK DEPRECIATION NET BLOCK
Description of At cost or Additions Sales and At Cost or Depreciation Depreciation As at As at
Assets Revalued and other other Revalued for the as at 31-03-2006 31-03-2005
Book Value Transfers Deduc- Book Value Year 31-03-2006
as at tions as at
01-04-2005 31-03-2006
Land 417.14 32.12 — 449.25 — — 449.25 417.14
Buildings 7,962.24 36.47 199.75 7,798.95 168.00 3,742.52 4,056.43 4,329.22
Plant and Machinery 42,342.16 9,014.19 1,219,33 50,137.02 2,075.21 23,778.18 26,358.84 20,001.69
Furniture, Fittings 754.00 19.07 16.23 756.84 52.05 633.69 123.14 180.46
Railway Sidings 0.59 — — 0.59 — 0.59 — —
DCW Limited Ò Annual Report 2005-2006

Vehicles 724.31 211.65 100.08 835.88 57.19 357.46 478.43 399.84
Total 52,200.44 9,313.49 1,535.41 59,978.54 2,352.45 28,512.44 31,466.09 25,328.36
Previous Year 50,345.53 2,210.31 355.40 52,200.44 2,117.70 26,872.09 25,328.36 25,366.01
Notes:
1. See Note “B-2” of Schedule “N”.

2. Buildings include Rs. 523.06 lacs being cost of ownership flats and office accommodation in Co-operative Societies and a Limited Company against which the
Company holds shares of the face value of Rs. 0.77 lacs in Co-operative Societies and the Limited Company.
3. Land includes the leasehold land valued at Rs. 70.99 lacs.
4. Assignment deeds in respect of 9.13 acres of Land at Caustic Soda Division, transferred by the Central Government to the State Government, are yet to be
executed by the State Government in favour of the Company.
5. Land, Building and Plant and Machinery located at Sahupuram Works (other than PVC Division) were revalued on 31.03.1993.
6. The Company exercised the option to purchase 793.39 acres of land leased by the State Government at Sahupuram Works. Assignment deeds in respect of the
said land are yet to be executed by the State Government in favour of the Company.
7. Fixed Assets includes assets taken over from erstwhile Pantape Magnetics Limited at revalued figure as per independent valuer’s report.
Schedules LIMITED

SCHEDULE “F” As at 31/03/2006 As at 31/03/2005
Face No. of Amount Face No. of Amount

Value per Shares/ Rs. in Value per Shares/ Rs. in
INVESTMENTS (At Cost) Share/ Bonds lacs Share/ Bonds lacs
Bond Rs. Unit/
Bond Rs.
I. Long Term :
In Govt. & Trust Securities (Unquoted)
7 Years National Savings Certificates 1000 10 0.10 1000 10 0.10
In Other Companies – Non-Trade (Unquoted)
The Dhrangadhra Peoples Co-op. Bank Ltd. 25 10 *250 25 10 *250
In Govt. & Trust Securities (Quoted)
Unit Trust of India - 6.75% Tax Free Bonds 100 19,358 19.36 100 19,358 19.36
In Other Companies – Non-Trade (Quoted)

Fully Paid Equity Shares
Global Trust Bank Ltd. 10 19,000 1.90 10 19,000 1.90
LIC Housing Finance Ltd. 10 17,400 10.44 10 17,400 10.44
12.34 12.34
Less: Diminution of value in shares of
Global Trust Bank 19,000 1.90 19,000 1.90
10.44 10.44
II. Current Investment :
Fully paid Equity Shares
Tata Consultancy Services Ltd. 1 3 0.03 1 3 0.03
Punjab National Bank Ltd. — — — 10 14,123 55.08
0.03 55.11
Mutual Funds
Principal Mutual Fund — Liquid Cash
Management Fund 10 9,999,400.775 1,000.01 — — —
Tata Mutual Fund — Liquid Fund SHIP
Daily Dividend 1,000 7,179.095 80.01 — — —
1,080.02 —
TOTAL 1,109.95 85.01
* Figures Denote Amount in Rupees.
31/03/2006 31/03/2005
Aggregate Value of long term quoted investments 32.99 31.70

Aggregate Value of current quoted investments 0.06 55.11
TOTAL 33.05 86.81
Aggregate Value of unquoted investments 0.10 0.10
Market Value of quoted investments 52.75 116.98

LIMITED Schedules
Face value No. of Units/Shares
SCHEDULE “F” (Contd.)

Investments Purchased and Redeemed/Sold during the year:
I. Mutual Funds Units :
SBI Mutual Fund - Magnum Institutional Income Fund 10.00 216,904,068.240

Prudential ICICI Mutual Fund - Super Institutional Liquid Plan 10.00 41,209,930.150
Principal Mutual Fund - Liquid Cash Management Fund 10.00 205,243,979.220
ING Vsya Mutual Fund - Liquid Fund Institutional 10.00 15,415,686.310
HSBC Mutual Fund - Cash Fund - Institutional 10.00 6,851,633.420
Tata Mutual Fund - Liquid Fund SHIP Daily Dividend 1,000.00 411,856.610
II. Shares :
Yes Bank 10.00 10,302
Punjab National Bank 10.00 14,123
Infrastructure Development Finance Corporation 10.00 26,003
As at As at
31/03/2006 31/03/2005
SCHEDULE “G”
INVENTORIES
(As Certified by the Management)
(Refer Note A-6 of Schedule ‘N’)
Stores, Spare Parts, Fuel 2,760.54 1,726.04
Packing Materials (at or below cost) 18.81 10.08
Mercury on hand & in process 210.85 201.60
STOCK-IN-TRADE
Raw materials on hand & in transit 3,239.82 3,150.35
Finished Goods 5,661.41 2,788.55
Stock in process 100.15 56.77
Packing Drums & Scrap 31.22 24.25
Coke dust, Gypsum 52.43 14.55
Stock of Traded Goods — 5.34
Shares (Refer Statement below) 8.25 8.06

TOTAL 12,083.48 7,985.59

Schedules LIMITED
Investment in shares (Stock-in-trade)

As at 31/03/2006 As at 31/03/2005
Face No. of Amount No. of Amount

Value per Shares Rs. in Shares Rs. in
Particulars Share Rs. lacs lacs
Quoted
Reliance Industries Ltd. 10 553 0.42 553 0.42
Reliance Capital Venture Ltd. 10 553 — — —
Reliance Communication Venture Ltd. 5 553 — — —
Reliance Energy Venture Ltd. 10 553 — — —
Reliance Natural Resources Ltd. 5 553 — — —
Grasim Industries Ltd. 10 700 2.01 700 2.01
Ranbaxy Laboratories Ltd. 5 5,426 5.60 2,713 5.60
Reliance Industrial Infrastructure Ltd. 10 1,900 0.19 — —
IPCL 10 43 0.03 43 0.03
TOTAL 8.25 8.06
As at As at
31/03/2006 31/03/2005
SCHEDULE “H”
Sundry Debtors (Unsecured unless otherwise stated)
(a) Over 6 months
Considered good (Secured) 30.00 30.00
Considered good 99.64 127.22
Considered doubtful 276.47 290.39
(b) Other Debts (considered good) 4,966.67 4,762.08
5,372.78 5,209.69
Less : Provision for doubtful debts 276.47 290.39
TOTAL 5,096.31 4,919.30

LIMITED
Schedules
As at As at
31/03/2006 31/03/2005
SCHEDULE “I”
CASH AND BANK BALANCES

1. Cash on hand 1.80 8.90
2. Cheques, Stamps, Hundi papers on hand 0.05 0.05
3. Balance with Scheduled Banks
a. in Current Account 357.09 310.52
b. in Fixed Deposits (Pledged with Bank as Margin Money) 9.51 46.04
4. Post Office Savings Deposit (Pass Book pledged with
Central Excise Department) 0.01 0.02
5. Balance with Dhrangadhra People’s Co-op. Bank Ltd. (Maximum amount
outstanding Rs. 0.85 lacs) 0.85 0.85
TOTAL 369.31 366.38
SCHEDULE “J”
LOANS AND ADVANCES (UNSECURED, CONSIDERED GOOD)

Advances recoverable in cash or kind or for value to be received
(Including advances for capital items) 4,065.99 2,692.06
Inter Corporate Deposits – Considered Good — 1,400.00
Staff loans 51.97 49.73
Interest accrued on Inter Corporate Deposits 0.44 —
Electricity and other Deposits 149.43 132.03
Balance with Customs, Central Excise etc. 659.22 656.20
Claims against Insurance, Railways, Custom etc. 381.15 34.14
Mat Credit Entitlement 272.35 —
TOTAL 5,580.55 4,964.16
SCHEDULE “K”
LIABILITIES
Acceptances against Letters of Credit 10,462.01 8,968.75
Sundry Creditors (Includes liabilities for capital items) * 1,813.82 1,234.07
Advances from Customers and Consignees 1,186.28 972.12
Trade and Other Deposits 611.95 352.29
Unclaimed Debentures Monies # 35.53 39.76
Unclaimed Dividend # 12.24 7.99
Unclaimed Public Deposit Monies # 0.43 0.93
Other Liabilities 782.52 485.31
Interest accrued but not due on Loans 51.83 75.00
TOTAL 14,956.61 12,136.22
* Includes outstanding dues of small scale industrial undertakings of

Rs. 14.81 lacs (Previous year Rs. 18.43 lacs).
# These figures do not include any amounts, due and outstanding,
to be credited to Investor Education and Protection Fund.

Schedules LIMITED

As at As at
31/03/2006 31/03/2005
SCHEDULE “L”
PROVISIONS
Proposed Dividend 517.63 414.16
Provision for Tax (net off Advance Tax and Tax Deducted at Source) 58.35 121.20
Provision for fringe benefit tax 21.00 —
Provision for Retirement & Other Emp. Benefits 517.33 297.30
TOTAL 1,186.91 886.79
SCHEDULE “M”
A. Contingent liabilities not provided for :
1. Disputed Sales Tax Demands 615.75 657.28
2. Disputed Entry Tax Demands 592.64 592.64
3. Disputed Excise Demands 291.91 359.14
4. Disputed Customs Demands 58.14 142.98
5. Disputed Income Tax Demands
(TDS Appeal pending before ITAT, Demand adjusted against refund
due to the company) 0.12 —
6. Company’s contribution to ESI not made pursuant to petitions for
exemption pending before High Court 79.08 79.08
7. Lease Rent, Local Cess, Land Revenue, Surcharge
Octroi & Water and Electricity Charges 1,396.10 1,145.01
8. Disputed Industrial relations matters 285.98 219.43
B. Claims not acknowledged as debts : 18.13 14.58

LIMITED Schedules
SCHEDULE - ‘‘N’’
SIGNIFICANT ACCOUNTING POLICIES AND NOTES FORMING PART OF THE BALANCE SHEET AND PROFIT AND LOSS ACCOUNT
FOR THE YEAR ENDED 31ST MARCH, 2006.
A. SIGNIFICANT ACCOUNTING POLICIES
1. SYSTEM OF ACCOUNTING
A. The Company follows the mercantile system of accounting and recognises income and expenditure on accrual basis.
B. Financial statements are prepared on historical cost basis and as a going concern, adjusted for revaluation/dimunition
in value of certain fixed assets.
2. USE OF ESTIMATES
The preparation of financial statements requires management to make certain estimates and assumptions that affect the
amounts reported in the financial statements and notes thereto. Differences between actual results and estimates are
recognized in the period in which they materialize.
3. FIXED ASSETS AND DEPRECIATION
(A) Fixed Assets

Fixed Assets are stated at their original cost net of Cenvat Credit where applicable (including expenses related to
acquisition and installation) except certain Fixed Assets which are adjusted for revaluation.
(B) Depreciation and Amortisation

Depreciation is charged in the Accounts on straight line method as under:
(a) On assets revalued at Sahupuram Unit on 31-3-93 @ 3% on the revalued cost based on revision in useful life
estimated by the valuer (Refer Note B2).
(b) On fixed assets added pursuant to the amalgamation of Pantape Magnetics Limited with the Company, at rates
specified in Schedule XIV to the Companies Act, 1956 on the revalued cost.
(c) On balance fixed assets of the Company at rates specified in Schedule XIV to the Companies Act, 1956 on the
original cost.
(d) On fixed assets added/disposed off during the year, on pro-rata basis with reference to the month of addition/
disposal.
(e) On Technical Know-how fees at 33.33%
4. EXPENDITURE DURING CONSTRUCTION AND ON NEW PROJECTS
In the case of new projects and in the case of modernisation/expansion of existing units, interest on borrowings for the
same and all pre-operative expenditure, incurred during implementation upto the date of installation are included under
Capital Work in Progress and capitalised by adding pro-rata to the cost of the assets.
5. INVESTMENTS
The Company’s investments comprise long term and current investments. Long Term investments are stated at cost less
permanent dimunition, if any, in value. Current investments are stated at lower of cost or market value.
6. INVENTORIES
Inventories are valued at lower of cost and net realisable value except stores, spares, mercury on hand and stock in process
which are valued at cost, packing materials which are valued at or below cost and scrap which is valued at net realisable
value. Cost is computed on weighted average basis and includes cost of conversion and other costs incurred in bringing the
inventories to their present location and condition.

Schedules LIMITED

7. ACCOUNTING FOR CENVAT AND SERVICE TAX CREDITS
Cenvat credit available on Raw Materials, Fuel and Packing materials, stores, spares and Capital goods and Service tax
credit on services availed are accounted for by reducing purchase cost of the related material or the expenses respectively.
8. FOREIGN CURRENCY TRANSACTIONS

(a) Transactions in Foreign Currency are recorded at the exchange rates prevailing on the date of Transactions.
(b) Monetary items denominated in foreign currencies (such as cash receivables, payables, etc.) outstanding at the year
end, are translated at exchange rate applicable as of that date.
(c) Non-monetary items denominated in foreign currency (such as investments, fixed assets, etc.) are valued at the
exchange rate prevailing on the date of transaction.
(d) Any gains or losses arising due to exchange differences at the time of translation or settlement are accounted in the
Profit & Loss account, except those relating to acquisition of fixed assets.
(e) Exchange difference arising on liabilities incurred on repayment of borrowings in foreign currency for acquisition of
fixed assets are accounted in the following manner:
(i) In respect of fixed assets acquired from a country outside India, exchange differences are adjusted in the carrying
cost.
(ii) In respect of fixed assets acquired in India
! Exchange difference on transactions in foreign currency entered prior to 1st April, 2004, are adjusted in
carrying cost.
! Exchange difference on transactions in foreign currency entered on or after 1st April, 2004, are recognised in
the Profit and Loss Account.
(f) Foreign currency Current Assets/Liabilities covered by forward contracts are translated at forward cover rates at the
close of the year. The resultant gain or loss on translation difference is recognised in the Profit and Loss Account.
(g) Premium/discounts on forward exchange contracts are amortised over the life of the contract and recognised in the
Profit and Loss account.
9. RESEARCH & DEVELOPMENT EXPENDITURE

Revenue Expenditure on Research & Development is charged against the Profit of the year in which it is incurred. Capital
expenditure on Research & Development is shown as an addition to fixed assets.
10. BORROWING COSTS

Borrowing costs attributable to acquisition, construction or production of a qualifying asset are capitalized as part of the
cost of that asset. A qualifying asset is one that necessarily takes substantial period of time to get ready for intended use. All
other borrowing costs are recognized as an expense in the period in which they are incurred.
11. RETIREMENT BENEFITS

(a) Contributions to Provident and Superannuation Funds are made to recognised funds and are charged to Profit & Loss
Account.
(b) The Company has created an Employees’ Group Gratuity Fund which has taken a Group Gratuity Assurance Scheme
with the Life Insurance Corporation of India. Premium charged by the Life Insurance Corporation of India, based on
actuarial valuation is debited to the Profit and Loss account.
(c) Liabilities towards Leave Encashment Benefit is provided for based on actuarial valuation done at the year end.
(d) Contribution to Employee Pension Scheme 1995 are accounted on accrual basis with corresponding remittance made
to Government Provident Fund authority.

LIMITED Schedules
12. PROVISIONS & CONTINGENCIES
(a) A provision arising out of a present obligation is recognized when it is probable that an outflow of resources will be
required to settle the obligation and the amount can be reasonably estimated.
(b) Wherever there is a possible obligation that may, but probably will not require an outflow of resources, the same is
disclosed by way of contingent liability.
(c) Show Cause Notices are not considered as Contingent Liabilities unless converted into demand.
13. TAXES ON INCOME

Income tax expenses comprises current tax and deferred tax charge or credit. Deferred tax assets/liabilities are measured
by applying tax rate and tax laws that have been enacted or substantially enacted by the Balance Sheet date. Deferred tax
asset arising on account of unabsorbed depreciation under tax laws is recognised only to the extent there is virtual certainty
of its realisation supported by convincing evidence. Deferred tax assets on account of other timing differences are recognised
only to the extent there is reasonable certainty of its realisation. At each Balance Sheet date, the carrying amount of
Deferred tax asset is reviewed based on developments to reassess realisation.
14. IMPAIRMENT OF ASSET

The carrying amount of assets are reviewed at each balance sheet date for indication of any impairment based on internal/
external factors. An impairment loss is recognized wherever the carrying amount of the assets exceeds its recoverable
amount. Any such impairment loss is recognized by charging it to the profit and loss account. A previously recognized
impairment loss is reversed where it no longer exists and the asset is restated to that effect.
B. NOTES ON ACCOUNTS
1. Estimated amount of Contracts remaining to be executed on Capital Account and not provided for is Rs. 18,315.87 lacs
(Previous year Rs. 4,676.51 lacs).
2. The depreciation charge on the assets revalued on 31-3-1993 is more by Rs. 46.89 lacs (previous year Rs. 43.24 lacs) than
the depreciation charge thereon under section 205(2)(b) of the Companies Act, 1956 and the same is met by drawing from
Revaluation Reserve. The uplift on revalued assets discarded amounting to Rs. 11.60 lacs (previous year Rs. 15.33 lacs) has
also been met by drawing from Revaluation Reserve.
3 Consignment sales and expenses are incorporated on the basis of sale notes when received from consignees.
4. Confirmation of balances from some of the Debtors and Creditors, have not been received.
5. The break up of Deferred Tax Assets/Liabilities are as under: (Rs. in lacs)
Nature of timing difference Deferred Tax Debit/(Credit) Deferred Tax Liability/

Liability/(Assets) for the year (Assets) as at
as at 1st April, 2005 31st March, 2006
(a) DEFERRED TAX LIABILITIES
Depreciation 5,658.48 616.21 6,274.69
SUB TOTAL 5,658.48 616.21 6,274.69
(b) DEFERRED TAX ASSETS
Provision for dimunition in value of
Business Centre Immovable Property 457.41 (36.66) 420.75
Provision for dimunition in
value of Investments 0.70 (0.70) —
Provision for Doubtful debts 11.20 (0.90) 10.30
Expenses allowed on payment basis 202.03 67.56 269.59
Long-term capital loss to be set-off 6.47 (0.52) 5.95
SUB-TOTAL 677.81 28.78 706.59
4,980.67 587.43 5,568.10

Schedules LIMITED

6. RELATED PARTY INFORMATION
(i) RELATIONSHIPS:
(a) WHERE CONTROL EXISTS

Double Dot Finance Ltd.
Crescent Finstock Ltd.
Sahu Brothers (Saurashtra) Pvt. Ltd.
Dhrangadhra Trading Company Pvt. Ltd.
Kishco Cutlery Ltd.
Kalpataru Botanical Garden Pvt. Ltd.
Crescent Holdings Pvt. Ltd.
(b) KEY MANAGEMENT PERSONNEL
Dr. S. C. Jain Chairman & Managing Director
Shri S. K. Jain Vice Chairman & Managing Director
Shri P. K. Jain Managing Director
Shri Bakul Jain Executive Director
Shri Vivek Jain Sr. President
Shri Mudit Jain President
Shri Ashish Jain President
Smt. Paulomi Jain Vice President
NOTE: Related party relationships on the basis of the requirements of Accounting Standard (AS) - 18 disclosed
above is as identified by the Company and relied upon by the auditors.
(ii) DISCLOSURE OF TRANSACTIONS BETWEEN THE GROUP AND RELATED PARTIES AND THE STATUS OF
OUTSTANDING BALANCES AS ON 31ST MARCH, 2006
(Rs. in lacs)
Particulars Enterprises where Key Management

control exists personnel
Commission paid — —
Remuneration paid — 264.77
Purchases 0.96 —
Balances as on 31st March, 2006 3.26 —

LIMITED Schedules
7. SEGMENT INFORMATION FOR THE YEAR 2005-06 (Rs. In lacs)
Caustic PVC Soda Ash Others Total
SEGMENT REVENUE
External Revenue 19,553.87 30,086.82 12,622.60 895.39 63,158.68
17,935.19 36,842.52 9,892.73 390.25 65,060.69
Inter Segment Revenue — — — — —

— — — — —
Total Revenue 19,553.87 30,086.82 12,622.60 895.39 63,158.68

17,935.19 36,842.52 9,892.73 390.25 65,060.69
RESULT
SEGMENT RESULT 638.24 (203.98) 1,512.38 1,555.80 3,502.44
1,531.68 187.62 452.10 204.78 2,376.18
Add: Unallocated Corporate Income — — — — 433.54

(Net of Expenses) — — — — 456.00
Less:
Finance Charges 706.49
464.40
Current Tax (84.86)
170.00
Deffered Tax 587.43
94.46
NET PROFIT 2,726.92
2,103.32
OTHER INFORMATION
Segment Assets 24,196.12 12,501.28 12,843.07 7,625.75 57,166.23
20,699.45 9,775.83 11,484.58 3,459.77 45,419.63
Add: Unallocated Corporate Assets — — — — 2,140.03

— — — — 1,773.42
Total 24,192.12 12,501.28 12,843.07 7,625.75 59,306.26

20,699.45 9,775.83 11,484.58 3,459.77 47,193.05
Segment Liabilities 1,292.08 13,069.01 1,037.85 553.04 15,951.98

1,207.13 10,699.45 742.99 380.38 13,029.95
Add: Unallocated Corporate Liabilities — — — — 18,670.60

— — — — 12,144.18
Total 1,292.08 13,069.01 1,037.85 553.04 34,622.58

1,207.13 10,699.45 742.99 380.38 25,174.13
Capital expenditure 1,760.76 771.76 981.51 5,354.86 8,868.89

1,216.41 1,466.07 1,823.66 — 4,506.14
Depreciation 1,296.30 262.96 455.74 290.55 2,305.55

1,213.21 189.36 580.00 91.89 2,074.46
8. Encroachers have occupied some portions of the land belonging to the Company at Sahupuram. Efforts are being made to
evict them.

Schedules LIMITED

9. Sales Tax Assessments of Dhrangadhra Unit are pending from 1994-95 to 1997-98 and 2003-04 to 2005-06 (except for
1998-99 and 2002-03 which have been completed). Central Sales Tax Assessments and Tamil Nadu General Sales Tax Act
of Sahupuram Unit are pending since 2001-2002.
10. The amount of exchange difference in respect of forward contracts to be recognised in the Profit and Loss Account in the
subsequent accounting year is Rs. Nil (Previous year Rs. 7.95 Lacs).
11. In respect of Plant & Machinery, equipment and other items taken on lease, the future obligations towards lease rentals
under the lease agreements as on 31st March, 2006 amount to Rs. 187.63 lacs (previous year Rs. 217.13 lacs).
12. In the matter of customs duty on imported calciner, the Hon’able Gujarat High Court has vide order, dated 15th December,
2005, partly allowed company’s civil application for refund of Rs. 41.48 lacs, to the extent of Rs. 17.50 lacs, that has since
been received and denied claim for refund of balance Rs. 23.98 lacs on account of unjust enrichment. The Company has
filed special leave petition before Hon’ble Supreme Court in this regard. The case is pending for hearing.
13. The Company’s pending application to the Government of Tamil Nadu for renewal of the lease of 3185 acres and 153 cents
of land at Vedaranayam from 1st April, 2003 has been directed by the Hon’able Supreme Court to be considered
by the learned Single Judge of the Madras High Court. The increase in lease rent, cess etc. on the said lease hold land
relating to the past period claimed by the State Government is disputed in writ petitions filed and pending in the Madras
High Court.
14. Computation of net profits under Section 349 of the Companies Act, 1956
(Rs. in lacs)
Particulars Amount
Profit before tax as per Profit & Loss Account 3,229.49
Add:
Wealth Tax paid 3.73
Managerial remuneration 222.62
Directors’ sitting fees 1.65
Less:
Profit on sale of Investments 16.82
Excess realization over original cost on fixed aseets 1,214.96
Net profit U/S 349 2,225.71
10% thereof i.e. (2225.71 X 10/110) 202.34
Less: Managerial remuneration paid 133.88
Commission payable 68.46
15. During the year 2004-05, the 3 carbonation towers at Soda Ash plant, were not commissioned as the desired results
relating to quality and efficiency were not forth coming during the trial runs. In the current year leading technical experts
have after evaluation recommended the installation of a higher capacity screw compressor to achieve desired results. The
Company proposes to establish this compressor along with doubling capacity of Soda Ash Plant. Pending this an amount of
Rs. 21.56 crores incurred on the carbonation towers, including trial run expenditure, is included under capital work in
progress.
16. (a) Sundry Creditors ( Schedule K) include Rs. 14.81 lacs due to small scale and ancillary undertakings outstanding for
more than 30 days. This amount has been determined to the extent such parties have been identified from available
information. This has been relied upon by the auditors.
(b) The small scale undertakings from whom amounts outstanding for more than 30 days are as under.:-
1. Industrial Traders 2. Hitesh Salt Traders 3. CI Pipe Mfg. Corpn. 4. Calcutta Belt Centre 5. Shree Shakti Rewinding
Works 6. Shree Darshan Engineering Works 7. Sandeep Salt Works 8. Decent Enterprise Salt 9. Gujarat Carbon
Products 10. SS Computech Pvt. Ltd. 11. Sri Rama Poly Bags. 12. Tamilnadu Synthetics Ltd.

LIMITED Schedules
17. Acceptances under current liabilities are disclosed after netting off fixed deposits for Rs. 501.16 lacs given as security to the
Company’s Bankers for issuing letter of credit. This does not understate the net current assets of the company.
18. Insurance claim received in respect of machinery damaged of Rs. 631 lacs is taken as other income and the written down
value of damaged machinery has been fully written off.
19. Based on evaluation by the management of their being reasonable certainity that the company will be liable to pay normal
income tax within 7 subsequent years, MAT credit of Rs. 272.35 lacs has been recognized as an asset with corresponding
credit to profit and loss account.
20. Earning per share (EPS) as per Accounting Standard -20
2005-06 2004-05
Profit after Tax 2,726.92 2,103.33
No. of Equity shares of Rs. 2 each as on 31.3.2006
Basic & Diluted 17,25,44,590 17,25,66,670
EPS (Rs.)
Basic & Diluted 1.58 1.22
(The existing equity shares of Rs. 10 each were sub-divided into 5 shares of Rs. 2 each w.e.f. 28th Sept., 05. Consequently
the average number of equity shares of previous year, have been adjusted for share split for computing EPS in accordance
with AS-20 issued by ICAI)
21. Information required in terms of Part IV of Schedule VI of the Companies Act, 1956 is attached.
Schedule “A” to “N” form an integral part of the Balance Sheet and Schedule “1” to “6” form an integral part of the Profit
and Loss Account.
Previous year figures are regrouped to match with current years grouping.

Chartered Accountants Chairman & Managing Director Dr. V. H. Joshi
Sushil Kumar Jalan
Directors

Schedules LIMITED
FORMING PART OF THE PROFIT AND LOSS ACCOUNT

31/03/2006 31/03/2005
SCHEDULE “1”
SALES (less Rebates and Trade Discount but including excise duty)
Direct Sale * 41,614.02 46,300.98
Consignment Sales 21,396.99 19,391.88
Export Sales 6,768.26 7,186.18
Other Sales * 227.58 426.95
Sale of Services [TDS Rs. 69.75 lacs, (Previous year Rs. 54.95 lacs)]. 351.97 284.73
TOTAL 70,358.82 73,590.72
* Includes Sale of Traded Goods Rs. Nil

(Previous Year Rs. 86.65 lacs) and Sale of Shares Rs. Nil (Previous Year
Rs. Nil)
SCHEDULE “2”
OTHER INCOME
Profit on Sale of Invesments 16.82 24.06
Profit on Sale of Fixed Assets 888.16 10.95
Unclaimed balance written back 1.32 35.68
Dividend received on Current Investments 59.16 37.92
Dividend received on Long Term Investments 1.91 1.53
Bad Debts recovered 10.42 —
Miscellaneous Income 1,413.55 815.22

TOTAL 2,391.34 925.36

LIMITED Schedules
31/03/2006 31/03/2005
SCHEDULE “3”
MANUFACTURING AND OTHER EXPENSES
1. Consumption of Materials : Raw Materials

Stock in hand and in process as at opening 3,150.35 3,257.00
Add : Purchases 37,058.89 40,689.90
Less : Closing stock in hand & in process (including taxes duties etc.) 3,239.82 3,150.35
TOTAL 36,969.42 40,796.55
2a. INCREASE/DECREASE IN STOCK
Closing Stock :
Manufactured Products 5,661.41 2,788.55
Stock in Process 100.15 56.77
Packing Drums and Scrap 31.22 24.25
Coke Dust & Gypsum 52.43 14.55
Stock of Traded Goods — 5.34
Stock of Traded Shares 8.25 8.06
5,853.46 2,897.52
Opening Stock :
Manufactured Products 2,788.55 3,820.08

Stock in Process 56.77 103.98
Packing Drums and Scrap 24.25 10.54
Coke Dust & Gypsum 14.55 21.08
Stock of Traded Goods 5.34 5.37
Stock of Traded Shares 8.06 8.06
2,897.52 3,969.11
Opening Stock – Closing Stock (2,955.94) 1,071.59
2b. Purchases for resale (Net of stock of traded goods capitalised/written off) (5.34) 84.30
TOTAL (2,961.28) 1,155.89
3. SALARIES, WAGES & BENEFITS TO EMPLOYEES
Salaries & Wages 2,824.16 2,662.23

Contribution to Provident and other Funds 523.61 366.39
Employees’ Welfare 311.78 285.26
TOTAL 3,659.55 3,313.88
4. Power and Fuel 10,440.03 7,591.86

Schedules LIMITED

31/03/2006 31/03/2005
SCHEDULE “3” (Contd.)
5. OPERATIONS AND MAINTENANCE
Repairs and Maintenance - Buildings 357.75 316.95
Repairs and Maintenance - Plant & Machinery 2,304.25 2,299.42
Repairs and Maintenance - Other Assets 138.36 106.33
Packing Charges 1,365.73 1,210.06
Other Operation & Maintenance Expenses 1,116.76 971.93
TOTAL 5,282.85 4,904.69
6. ASSETS SOLD OR WRITTEN OFF

Fixed Assets discarded, obsolete, written off 427.84 62.81
Less: Drawn from Revaluation Reserve (11.61) (15.33)
416.23 47.48
Loss on Sale of Fixed Assets 94.20 19.57
(Unserviceable, written off etc.)
TOTAL 510.43 67.05
7. ADMINISTRATION EXPENSES
Rent 15.09 14.92
Rates, Taxes and licence fees 415.48 358.39
Insurance 232.11 137.64
Exchange Difference 196.28 (113.39)
Wealth Tax paid 3.73 3.11
Donation 3.77 0.80
Other expenses 653.57 613.98
TOTAL 1,520.03 1,015.45
8. SELLING AND DISTRIBUTION

Freight, Transportation, Loading and Other Charges (Net) 1,055.16 1,017.67
Commission to wholesalers/others 459.54 302.25
Cash discount 94.16 131.83
Octroi – Consignment Sale 2.78 1.58
TOTAL 1,611.64 1,453.33
9. (a) PAYMENT TO AUDITORS

(i) Audit Fees 5.33 4.96
(ii) Tax Audit 1.33 1.24
(iii) Representation in Tax matters 3.00 —
(iv) Retainer Fees 3.60 3.40
(v) Other Services 1.64 1.29
(vi) Reimbursement of Expenses 2.62 2.03
TOTAL 17.52 12.92

LIMITED Schedules
31/03/2006 31/03/2005

(b) Details of Directors’ Remuneration under Section 198
(i) Managing Director’s and Whole-time Directors’ Remuneration:
Salary 96.00 72.00
Perquisites on House 9.60 9.60
Company’s Contribution to PF 11.52 8.62
Medical Expenses 20.99 0.15
Company’s Contribution to Superannuation 14.40 10.13
Commission 68.46 133.44
(ii) Directors Sitting Fees 1.65 0.98
222.62 234.92
TOTAL 57,272.81 60,546.54
SCHEDULE “4”
INTEREST AND FINANCE CHARGES
Debentures — 0.49
Fixed loans 442.57 136.68
Others 263.92 327.23
706.49 464.40
Less: Interest from banks & others [TDS Rs. 80.65 lacs
(Previous Year Rs. 50.67 lacs)] (355.65) (392.49)
TOTAL 350.84 71.91
SCHEDULE “5”
DEPRECIATION
Depreciation on Fixed Assets for the year 2,352.45 2,117.70
2,352.45 2,117.70
Less: Drawn from Revaluation Reserve 46.89 43.24
TOTAL 2,305.56 2,074.46

Sushil Kumar Jalan
Directors

Schedules LIMITED

SCHEDULE “6”
(a) Quantitative information with regard to each class of goods manufactured/traded (as certified by Chairman & Managing Director) (Rs. in Lacs)
CAPACITY – MT OPENING STOCK PRODUCTION SELF CLOSING STOCK SALES

PARTICULARS
CONSUMP-
TION
Licensed Installed Quantity Value Quantity Quantity Quantity Value Quantity Value
M.T. Rs. In lacs M.T. M.T. M.T. Rs. In lacs M.T. Rs. In lacs
Dharangadhra Unit
Soda Ash 96,000 96,000 753 62.72 87,340 9,679 1,437 124.54 76,977 7,825.84
(96,000) (96,000) (3,180) (223.68) (83,091) (8,243) (753) (62.72) (77,275) (6,904.63)
Soda Bicarbonate 12,000 12,000 1973 184.20 18,810 — 1,533 147.42 19,250 1,998.68
(12,000) (12,000) (315) (34) (16,458) (—) (1,973) (184.20) (14,800) (1,543.87)
Amonium Bicarbonate 5,000 — 34 2.50 2,721 — 13 1.04 2,742 216.61

(5,000) (—) (56) (3.90) (1,950) (—) (34) (2.50) (1,972) (147.15)
Detergent — Green — — — — 7,391 — — — 7,391 915.42

(—) (—) (—) (—) (12,966) (—) (—) (—) (12,966) (1,316.66)
Detergent — Active — — — — 24,160 — — — 24,160 3,473.78

(—) (—) (—) (—) (12,688) (—) (—) (—) (12,688) (1,663.11 )
Sahupuram Unit
Caustic Soda Lye 60,000 60,000 425 41.34 60,100 20,609 1,346 147.75 38,570 6,275.15
(60,000) (60,000) (680) (61.90) (61,420) (21,795) (425) (41.34) (39,880) (4,793.50)
Caustic Soda Solid — — 8 1 187 — 5 0.70 190 41.37

(—) (—) (11) (1) (116) (—) (8) (1) (119) (19.04)
Caustic Soda Flakes — — — — 19,848 201 390 55.23 19,257 3,572.77

(—) (—) (312) (36) (20,452) (138) (—) (—) (20,626) (3,103.22)
Sodium Hypochloride — — — — 2,343 4 — — 2,339 56.61

(—) (—) (—) (—) (1,638) (4) (—) (—) (1,634) (38.54)
Hydrochloric Acid 100% 39,600 33,000 16 1 35,655 32,553 14 0.61 3,104 203.06
(39,600) (33,000) (23) (1) (33,009) (28,836) (16) (1) (4,180) (252.50)
Liquid Chlorine 40,000 40,000 118 8 18,400 6,598 116 7.54 11,804 814.55
(40,000) (40,000) (113) (6) (22,220) (7,974) (118) (8) (14,241) (1,041.25)
Trichloroethylene 5,400 5,400 384 171 4,333 — 373 169.22 4,344 2,051.92
(5,400) (5,400) (158) (63) (5,355) (—) (384) (171) (5,129) (2,478.39)
Upgraded Ilmenite No Licence 25,000 1,640 337 33,536 — 1,681 383.62 33,495 6,932.97
Required (25,000) (7,580) (1,314) (28,900) (—) (1,640) (337) (34,840) (6,601.58)
Utox No Licence 600 41 7 687 4 66 10.78 658 182.45

Required (600) (152) (26) (595) (6) (41) (7) (700) (184.19)
Ferric Chloride — 10,000 140 2 2,730 23 302 2.80 2,545 38.80

(—) (10,000) (78) (1) (2,466) (39) (140) (2) (2,365) (43.28)
Yellow Iron Oxide — — 40 10 386 — 15 4.67 411 118.25

(—) (—) (7) (2) (408) (—) (40) (10) (375) (92.92)
PVC Resin — 60,000 3,599 1,891 82,280 — 10,619 4,539.55 75,260 34,879.25
(—) (60,000) (4,345) (1,932) (77,330) (—) (3,599) (1,891) (78,076) (42,617.29)
Caustic Soda Lye — — — — — — — — — —

(Traded Goods) (—) (—) (—) (—) (—) (—) (—) (—) (—) (38.38)
Misc. Sales — — — — — — — — — 227.58

(—) (—) (—) (—) (—) (—) (—) (—) (—) (376.29)
Total 69,825.06
(73,255.79)
Note: 1. Licensed capacity is not applicable in view of the Company’s products having been delicensed as per the new liberalised licensing policy announced by the Government
of India.
2. Ammonium Bicarbonate production is out of part of Soda ash plant.
3. Self consumption quantity mentioned includes quantity lost in handling, lost in transit, wash loss, samples, etc.
4. Previous year figures are given in bracket.

LIMITED Schedules
Rs. in lacs

Consolidated:
(b) Expenditure in Foreign Currency

(i) Know-how fees —
(—)
(ii) Consultant fees —
(—)
(iii) Others 617.53
(593.83)
(c) Earnings in Foreign Exchange

(i) Export on f.o.b. basis 6,736.23
(7,214.05)
(ii) Others 32.73
(57.23)
(d) Consumption of imported/indigenous Raw Materials,

Stores and Spares at Landed Cost
Raw Material Imported 28,394.75
(33,077.74)
Indigenous 9,258.00
(10,565.19)
Stores and Spare parts (Including Consumption for Capital jobs)
Imported 949.33
(675.75)
Indigenous 5,127.59
(6,109.27)
Mercury
Imported 1.61
(1.98)
Indigenous —
(—)
(e) Value of Imports on c.i.f. basis

(i) Raw Materials 26,855.37
(29,720.91)
(ii) Fuel Oil —
(—)
(iii) Mercury 11.61
(7.32)
(iv) Stores and Spare parts 1,015.23
(332.56)
(v) Capital Goods 624.18
(87.52)
(f) Amount remitted in Foreign Currencies on account of Dividend —

(—)

Schedules LIMITED

Total
Quantity Value
(M.T) Rs. in lacs
(g) Raw Materials consumed :

Salt 3,10,922 586.77
(3,07,938) (1,039.30)
Ilmenite Sand 64,150 2,288.23

(56,035) (1,860.78)
Calcium Carbide 3,251 820.36

(4,306) (1,154.73)
Vinyl Chloride Monomer 83,199 27,351.32

(78,314) (31,835.73)
Lauryl Peroxide 23 63.05

(21) (57.53)
Limestone 2,24,946 1,096.17

(1,91,199) (861.54)
Coke 23,518 1,689.23

(19,335) (1,587.47)
Ammonia 1,667 248.65

(1,383) (241.64)
Others — 2,842.91
(—) (2,015.06)
Consumption of own manufactured products — 666.05

and Intermediates (—) (2,989.15)
TOTAL 37,652.74
(43,642.93)

Dr. V. H. Joshi
Sushil Kumar Jalan
Directors

LIMITED
Statement Pursuant to Part IV of Schedule VI of the Companies Act, 1956

Balance Sheet Abstract and Company’s General Business Profile.
I. Registration Details
Registration No. 7 4 8 State Code 0 4
Balance Sheet Date 3 1 / 0 3 / 2 0 0 6
(Date / Month / Year)
II. Capital raised during the year (Amount in Rs. Thousands)
Public Issue Rights Issue
N I L N I L
Bonus Issue Private Placement
N I L N I L
III. Position of Mobilisation and Deployment of Funds (Amount in Rs. Thousands)
Total Liabilities Total Assets
5 8 8 0 5 3 6 5 8 8 0 5 3 6
Sources of Funds
Paid-up Capital Reserves & Surplus
3 4 5 0 8 9 2 0 6 4 2 5 6
Secured Loans Unsecured Loans
1 2 9 9 4 1 4 6 1 5
Application of Funds
Net Fixed Assets Investments
3 4 5 6 5 7 6 1 1 0 9 9 5
Net Current Assets Misc. Expenditure
6 9 8 6 1 3 N I L
Accumulated Losses Project Expenditure
N I L N I L
IV. Performance of Company (Amount in Rs. Thousands)
Turnover Total Expenditure
7 0 3 5 8 8 2 5 9 9 2 9 2 1
+ – Profit/Loss Before Tax + – Profit/Loss After Tax
+ 3 2 2 9 4 9 + 2 7 2 6 9 2
Earnings per Share in Rs. Dividend Rate (%)
1.58 1 5
V. Generic Names of Three Principal Products/Services of the Company (as per monetary term)
(a) Item Code No. (ITC Code) Product Description
3 9 0 0 4 2 1 0 2 POLY VINYL CHLORIDE BY SUSPENSION
2 8 1 5 1 1 0 1 CAUSTIC SODA
2 8 3 6 2 0 0 9 SODA ASH

Sushil Kumar Jalan
Directors

DCW Ltd. - Annual Report - 2005-2006

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DCW Ltd. - Annual Report - 2005-2006

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Corporate Directory LIMITED

BOARD OF DIRECTORS AUDITORS

Shri Sharad Kumar Jain

Smt. Satyawati Jain

Dr. V.H. Joshi

Shri Sushil Kumar Jalan

DCW Limited Ò Annual Report 2005-2006 1

Appropriations: (c) Soda Ash Division:

2 DCW Limited Ò Annual Report 2005-2006

DCW Limited Ò Annual Report 2005-2006 3

technological support for and M/s. R. Nanabhoy & Company

4 DCW Limited Ò Annual Report 2005-2006

DCW Limited Ò Annual Report 2005-2006 5

1. Company’s philosophy on Code of Corporate Governance:

Ò Size of the Board:

Attendance Particulars Other Committee

Promoter/ Dr. Shashi Chand Jain 6 No 4 2 —

Shri Sharad Kumar Jain 2 No — — —

Shri Pramod Kumar Jain 6 Yes 2 — —

Shri Bakul Jain 6 No 1 — —

Promoter/Non-Executive Smt. Satyawati Jain 4 No — — —

Non-Executive and Shri Yuvraj Saheb of 4 No — — —

Shri F.H. Tapia 5 No — — —

Dr. V.H. Joshi 6 Yes — — —

Shri Sushil K. Jalan 2 No 6 — —

Shri N.R. Ruia 4 No 2 — —

6 DCW Limited Ò Annual Report 2005-2006

3. Audit Committee: Ò Composition, Name of Members and

DCW Limited Ò Annual Report 2005-2006 7

Sitting Fee also includes payment for Board 7. Disclosures:

8 DCW Limited Ò Annual Report 2005-2006

(3) Shareholders’ Rights: Financial calendar: April 2006 – March 2007:

DCW Limited Ò Annual Report 2005-2006 9

Market price data: Distribution of shareholding as on 31.03.2006:

10 DCW Limited Ò Annual Report 2005-2006

Dematerialisation of shares: 16,01,08,805 Equity shares Outstanding GDRs /ADRs/Warrants /convertible

Address for correspondence:

Certificate on Clause 49 Compliance

The Board Of Directors

DCW Limited Ò Annual Report 2005-2006 11

1.2 IRON OXIDE AREA

1.3. CAUSTIC SODA AREA

12 DCW Limited Ò Annual Report 2005-2006

2. EXPENDITURE ON RESEARCH & DEVELOPMENT:

Rs. 87.51 lacs

Caustic Soda Unit PVC Unit Soda Ash Unit

DCW Limited Ò Annual Report 2005-2006 13

Caustic Soda Unit PVC Unit Soda Ash Unit

(B) Consumption per unit

Electricity (Kwh) 3002 3005 226 233.00 243.00 240.00

Annexure to the Directors’ Report

Employed for whole of the year

Employed for part of the year

2 Shri B. M. Mulla General Manager 998,229 M.A. 31 10.11.1975 61 —

14 DCW Limited Ò Annual Report 2005-2006

AS AT 31ST MARCH, 2006

* One US $ = Rs. 44.63

DCW Limited Ò Annual Report 2005-2006 15

Sales (including Excise Duty) 157.65 168.21

Other Income 5.36 2.12

Manufacturing and Other Expenses 128.33 138.39

Provision for Tax

Deferred Tax 1.32 0.22