Suryavanshi 5141400310

BOARD OF DIRECTORS
Sri B.N.Agarwal
Chairman and Managing Director
Sri R.Surender Reddy

Sri B.N.Rathi
Dr. Akkineni Nageswara Rao
Sri G.Ganesh
Nominee of IDBI
Sri Rajender Kumar Agarwal
Joint Managing Director
Sri J.K.Agarwal
Executive Director
Sri D.K.Agarwal
Whole-time Director
Vice President (Corporate Affairs) &

Company Secretary
Sri B.R.S.Reddy
General Manager (Finance & Accounts)
Sri K.N.Nevatia
Auditors
M/s. Brahmayya & Co.
Hyderabad
Bankers
Andhra Bank
State Bank of Hyderabad
ICICI Bank Ltd
State Bank of India
IDBI Bank Limited
The Bank of Rajasthan Limited
Registered Office
6th Floor, Surya Towers, 105, S.P. Road,
Secunderabad - 500 003. Telephone: (040) 30512700
Website: www.suryavanshi.com
Registrar and Share Transfer Agents
M/s.Sathguru Management Consultants Pvt. Ltd.,
Plot No.15, Hindi Nagar, Behind Saibaba Temple,
Punjagutta, Hyderabad - 500 034.
Ph. Nos. (040) 23356507, 23356975
Fax Nos.(040) 40040554
SALES DEPOT
SSM Compound, No. 86, Mangalam Road,
Tirpur, Tamil Nadu - 641 604.
FACTORIES
Unit - I Bhongir, Nalgonda Dist
Andhra Pradesh - 508 116
Unit - II Aliabad, Medchal Taluq
Ranga Reddy Dist. Andhra Pradesh - 500 078
Unit - III Rajna, Pandhurna (Tq.)
Chindwara Dist. Madhya Pradesh - 480 340
NOTICE
NOTICE is hereby given that the 31st Annual General
Meeting of the Members of Suryavanshi Spinning Mills
Limited will be held on Wednesday, the 29th September,
2010, at 10.00 AM. at Gayatri Gardens, Survey No.26,
Sikh Village, Near Diamond Point Hotel, Secunderabad500 003 to transact the following business:
b)
Commission @ 1% (one percent) of Net

Profits of the Company or 50% of the salary
whichever is less.
c)
Perquisites: In addition to salary and

commission as stated above, Sri R.K.Agarwal
shall be entitled to the following perquisites.
ORDINARY BUSINESS:
I.
2.
To receive, consider and adopt the Profit and Loss

account for the year ended 31st March, 2010 and
Balance Sheet as on that date and the reports of
the Directors' and Auditors' thereon.
To appoint a Director in place of Sri B.N.Rathi,
who retires by rotation and being eligible, offers
himself for reappointment.
3.
To appoint a Director in place of Sri R.Surender

Reddy, who retires by rotation and being eligible,
offers himself for reappointment.
4.
To appoint M/s. Brahmayya & Co., Chartered

Accountants, as statutory auditors to hold office from
the conclusion of this Annual General Meeting until
the conclusion of the next Annual General Meeting
and fix their remuneration.
PART - A:
i)
Rent free furnished residential accommodation

with all facilities and amenities including such
services as gas, electricity, water etc. or HRA
to the extent of 40% of the salary.
ii)
Medical Reimbursement: Reimbursement of

medical expenses for self and family subject to
a ceiling of one month's salary in a year or
three month's salary over a period of three
years.
iii)
Leave Travel Concession for self and family

once in a year in accordance with the Rules of
the Company.
iv)
Fees of clubs, subject to a maximum of two

clubs provided that no life membership or
admission fees is paid.
v)
Personal Accident Insurance: Premium not to

exceed Rs.4000/- (Rupees Four thousand) per
annum
SPECIAL BUSINESS:
5.
TO CONSIDER, AND IF THOUGHT FIT, TO

PASS THE FOLLOWING RESOLUTIONS
WITH OR WITHOUT MODIFICATION(S) AS
A SPECIAL RESOLUTION:
"RESOLVED THAT subject to the provisions of
Sections 198, 269, 309, read with Schedule XIII and
other applicable provisions, if any, of the Companies
Act, 1956 (including any statutory modification or
re-enactment thereof, for the time being in force),
subject to such approvals as may be required Shri
R.K.Agarwal be and is hereby reappointed as Joint
Managing Director of the Company for a further
period of five years with effect from 21st May, 2010,
on the terms and conditions mentioned below:
a)
Basic Salary: Rs.80,000/- per month
PART - B:
i)
Contribution to Provident Fund, Super

annuation Fund or Annuity Fund, Group
Insurance Scheme as per the Rules of the
Company
ii)
Gratuity payable shall not exceed half a month's

salary for each completed year of service.
PART - C:
i)
Provision of car for use of company's business

and telephone at residence
"FURTHER RESOLVED THAT where in any

financial year during the currency of the tenure of
Sri. R.K.Agarwal Joint Managing Director, the
Company has no profits or its profits are inadequate,
the Company will pay remuneration by way of salary,
perquisites and allowances as specified above as a
minimum remuneration subject to provisions of Part
II of Schedule XIII of the Companies Act, 1956".
6.
TO CONSIDER, AND IF THOUGHT FIT, TO

PASS THE FOLLOWING RESOLUTIONS
WITH OR WITHOUT MODIFICATION(S) AS
AN ORDINARY RESOLUTION:
"RESOLVED THAT consent of the Company be
and is hereby given in terms of Section 293(1)(a)
and other applicable provisions, if any, of the
Companies Act, 1956 to the Board of Directors for
the mortgage and/or charge on all the movable and
immovable properties of the Company, wheresoever
situate, present and future, of the whole of the
undertaking of the Company together with power
to takeover the management of the business and
concern of the Company in certain events on first
charge basis on pari passu basis among the first
charge holders in favour of :
Andhra Bank(AB) Sultan Bazar, Hyderabad of its
Term Loan of Rs.4.42 Crores.
State Bank of Hyderabad, Commercial Branch,
Secunderabad of its Term Loan of Rs. I.78 Crores.
ICICI Bank Limited, Begumpet, Hyderabad of its
Term Loan of Rs. 1.00 Crore.
Together with interest thereon at the agreed rates,

compound interest, additional interest, liquidated
damages, premia on prepayment or on redemption,
costs, charges, expenses and other monies payable
by the Company to Andhra Bank,State Bank of
Hyderabad and ICICI Bank under their letter of
sanctions/loan agreements entered / to be entered
into by the Company in respect of the said financial
assistance.
Provided, however that the above mortgage/charge
in favour of AB/SBH/ICICI Bank shall rank pari-passu
with the mortgages and / or charges already created
or to be created by the Company to secure the
term loans sanctioned/to be sanctioned by ICICI
BANK, IDBI Bank Limited, State Bank of India and
The Bank of Rajasthan Limited
FURTHER RESOLVED THAT the Board of
Directors of the Company be and is hereby
authorised to finalise with Andhra Bank/State Bank
of Hyderabad/ICICI Bank, the documents for
creating aforesaid mortgage and to do all such acts
and things, as may be necessary for giving effect to
the above resolution".
BY ORDER OF THE BOARD
For SURYAVANSHI SPINNING MILLS LTD
B.R.S. REDDY
VICE PRESIDENT (CORPORATE AFFAIRS)
& COMPANY SECRETARY
Place : Secunderabad
Date : 20th May, 2010
NOTES:
1. A MEMBER ENTITLED TO ATTEND THE
MEETING IS ENTITLED TO APPOINT A
PROXY TO ATTEND AND VOTE INSTEAD OF
HIMSELF AND SUCH PROXY NEED NOT BE
A MEMBER OF THE COMPANY.
2. PROXIES IN ORDER TO BE EFFECTIVE MUST
BE DEPOSITED WITH THE COMPANY NOT
LESS THAN 48 HOURS BEFORE THE TIME
FOR HOLDING THE MEETING.
3. The register of members and share transfer books
will be closed from Friday, 24th September, 2010 to
Wednesday, 29th September, 2010 (both days
inclusive) for the purpose of Annual General Meeting.
4. The shareholders desiring any further information as
regards the accounts are requested to write to the
Company so as to reach it at least one week prior to
the date of the meeting for consideration of the
management to deal at the meeting.
5. Unclaimed dividends of the following years will be
transferred to the Investor Education & Protection
Fund set up by the Central Government on the dates
mentioned against them. Members who have not
encashed their dividend warrants pertaining to the
above years may have their warrants revaildated by
sending them to the Registered Office of the
Company.
For the
Financial
Date of
declaration
Due date for

transfer
2005-2006
30.09.2006
06.11.2013
2006-2007
09.08.2007
15.09.2014
6. The Companies Act, 1956 provides for the facility of

nomination to the holders of Shares in a Company.
Accordingly members can avail the facility of
nomination in respect of their shares held either singly
or jointly. Members desiring to avail this facility are
requested to fill up the prescribed nomination form
and send the same to the Registered Office of the
Company.
7. The shares of the Company continue to be listed on
the Stock Exchange at Mumbai and the Company has
paid upto date all the listing fees to the Stock
Exchange.
8. Members are requested to notify immediately any
change of address to their Depository Participants (DPs)
in respect of their holding in electronic form, and to
M/s. Sathguru Management Consultants (P) Ltd, Unit:
Suryavanshi Spinning Mills Limited, Plot No.15, Hindi
Nagar, Panjagutta, Hyderabad - 500 034, India in
respect of their holding in physical form, if any.
9. The Members are requested to bring their copy of
the annual report with them at the time of attending
Annual General Meeting.
EXPLANATORY STATEMENT PURSUANT TO SECTION 173 (2) OF THE

COMPANIES ACT, 1956.
ITEM NOS.2 &3
REAPPOINTMENT OF RETIRING DIRECTORS
As required by Clause 49 of the Listing Agreement on
Corporate Governance particulars of the Directors being
reappointed are provided elsewhere in the Annual Report.
ITEM NO 5.
Present term of appointment of Sri R.K.Agarwal, Joint
Managing Director of the Company will be expiring on
30th October, 2010.
Sri R.K.Agarwal, B.Tech (Mechanical) has vast experience
in the textile industry. He has been associated with the
Company for the last 25 years in various capacities. With
a view to avail his services, the Board has re-appointed
Sri R.K. Agarwal, as Joint Managing Director subject the
approval of Financial Institutions and members, for a
further period of 5 years with effect from 21st May, 2010
on the terms and conditions mentioned in the item No.5
of the Notice. The remuneration Committee has already
approved the remuneration payable to Sri R.K. Agarwal.
Sri R.K. Agarwal is the Promoter Directors of the company
and holds 183544 shares in his name as on 31.03.2010
In the best interest of the Company, the Board
recommends the resolution for your approval.
Sri R.K.Agarwal himself, Sri B.N.Agarwal, Sri J.K.Agarwal,
Sri D.K.Agarwal, being related to each other are deemed
to be interested in this resolution.
None of the other Directors is interested / concerned in
this resolution.
State Bank of Hyderabad, Commercial Branch,

Secunderabad vide its letter No.F/ADV/662 dated
15.02.2010 has sanctioned a Term Loan of Rs.I.78 Crores
ICICI Bank Limited, Begumpeet, Hyderabad vide its letter
No.SSG/2009/CMOG No.90/W48HYD/22914 dated
31.12.2009 has sanctioned a Term Loan of Rs.1.00 crore.
The Andhra Bank, State Bank of Hyderabad and ICICI
Bank have sanctioned the above referred term loans by
converting part of their irregular portion of existing
working capital limits already sanctioned to the Company.
The above term loans are to be secured by way of first
pari-passu charge/mortgage of all the company's
immovable properties
Now, the company has to create mortgage on its
immovable properties in favour of Andhra Bank /State
Bank of Hyderabad/ICICI Bank to secure the term loans
referred above by way of extension of equitable mortgage
by deposit of title deeds
Since the mortgaging by the Company of its immovable
properties as aforesaid in favour of above banks may be
regarded as disposal of the Company's properties /
undertakings, it is necessary for the members to pass a
resolution under section 293(l)(a) of the Companies Act,
1956 for the creation of the said mortgage.
The Board recommends the Resolution for your approval.
None of the Directors is interested or concerned in the
Resolution
BY ORDER OF THE BOARD
For SURYAVANSHI SPINNING MILLS LTD
ITEM NO.6
Andhra Bank, Sultan Bazar, Hyderabad vide its letter
No.205/1/44/863(a) dated 29.09.09 has sanctioned a Term
Loan of Rs.4.42 Crores
B.R.S. REDDY
VICE PRESIDENT (CORPORATE AFFAIRS)
& COMPANY SECRETARY
DIRECTORS' REPORT
Rs. 3.05 Crores as against the loss of Rs. 13.94 Crores

respectively in the previous year.
To
The Members
YARN
Your Directors are pleased to present their 31st Annual

Report on the business and operations of the Company
and the financial results for the year ended 31st March,
2010.
The aggregate production of Yarn, during the year

2009-10, in Bhongir and Aliabad units in Andhra Pradesh
and Rajna in Madhya Pradesh was 123.20 lakhs Kgs as
against the production of 119.21 lakhs kgs during the
previous year.
(Rs. in Lakhs)
2009-10
2008-09
Financial Results
READYMADE GARMENTS
18,865
16,194
1,920
321
740
735
Improved international market scenario since end 2009

onwards coupled with increased realization, enabled the
company to achieve Readymade garment's production
during the year 2009-10 of 16.04 lakh pieces as against
10.72 lakh pieces in the previous year, thus registering
robust growth of about 50%.
875
974
DIVIDEND
305
(1,388)
Provision for Income Tax
In view of the insufficient profits earned by the Company,

the Directors regret their inability to recommend Divided.
- Deferred Tax
CAPITAL EXPENDITURE
- Fringe Benefit Tax
305
(1394)
(861)
533
305
(861)
(556)
(861)
Net Turnover including

other income
Gross profit before financial
charges & Depreciation
Less: Depreciation
Finance charges
Profit/(Loss) Before Taxation
Profit/(Loss) after taxation

Profit/(Loss) Brought Forwarded
from last year
Amount available for appropriation
Balance carried to Balance Sheet
Continuous Modernization is essential in the Spinning

Industry to meet the stringent quality parameters and
your company during the year under review, incurred
capital expenditure of Rs.332.22 lakhs for up-gradation
of machinery and balancing equipments at its units as
against Capital Expenditure of Rs.695.53 lakhs in the
previous year.
OPERATIONS
EXPORTS
After a long recessionary phase, the Textile Industry

started witnessing turnaround. Factors which helped the
industry was good cotton crop, increased demand in
domestic as well as international market. This trend is
expected to continue in the current year also.
The exports during the year were Rs.35.01 crores including

merchant exports of Rs.1.37 Crores as against the export
turnover of Rs.22.58 Crores including merchant exports
of Rs.51 Lakhs during the previous year.
The Company, during the year 2009-10, achieved a

turnover of Rs. 188.65 Crores as against the turnover of
Rs. 161.94 Crores and earned Profit After Tax of
International markets have picked-up after the

recessionary trends have eased. The company is confident
of capitalizing on the favourable market conditions
prevailing both within the country and abroad.
INCREASE IN THE PAID-UP EQUITY CAPITAL

Your company has allotted 19,50,000 Equity Shares of
Rs.10/- each to non-promoters at a premium of Rs.5/per share, Consequent upon the allotment of Equity
Shares, the paid-up capital of the Company stands
increased to Rs. 13,27,09,230/- The said funds were
utilized for augmenting the longterm resources of the
company.
FUTURE OUTLOOK
Textile Industry recovered faster than other sectors from
the global recession.
The textile industry outlook is definitely positive with
increased cotton production, though prices have touched
highest ever. The garment industry needs support by
way of flexible labour laws to enable the industry to
remain competitive in the current international market
scenario.
Technology Upgradation Fund Scheme (TUFS)
of public companies in which they hold directorships as

stipulated under clause 49 of the listing agreement with
the Stock Exchange are given on Corporate Governance
elsewhere in the Annual Report.
CORPORATE GOVERNANCE
Pursuance to Clause 49 of the Listing Agreement with
the Stock Exchange, a detailed report on the Management
Discussion and Analysis, Corporate Governance Report
and Additional information to the Shareholders are made
part of this Annual Report.
RESPONSIBILITY STATEMENT OF THE BOARD
OF DIRECTORS
The Board of Directors of the Company confirms:
1.
that in the preparation of the annual accounts, the

applicable accounting standards have been followed
and there has been no material departure ;
2.
that the selected accounting policies were applied

consistently and the Directors made judgements and
estimates that are reasonable and prudent so as to
give a true and fair view of the state of affairs of the
Company as at March 31, 2010 and of the profit of
the Company for the year ended on that date.
3.
that proper and sufficient care has been taken for

the maintenance of adequate accounting records in
accordance with the provisions of the Companies
Act, 1956 for safeguarding the assets of the
Company and for preventing and detecting fraud
and other irregularities;
4.
that the annual accounts have been prepared on a

going concern basis.
Of all the schemes introduced by the Government of

India, TUFS has contributed the maximum to the
modenisation and enhancement of the capacities of all
facets of Textile Industry. The interest subsidy has
facilitated investments by the Industry.
DIRECTORS
Pursuant to provisions of Section 255 and 256 of the
Companies Act, 1956, Sri B.N.Rathi and Sri R.Surender
Reddy Directors will retire at the ensuing Annual General
Meeting and being eligible, offer themselves for
reappointment.
The terms of appointment of Sri R.K.Agarwal, Joint
Managing Director will be expiring on 30th October, 2010.
The necessary resolutions seeking approval of the
members for the appointment and the remuneration
payable to Sri R.K.Agarwal has been included in the notice
for the ensuing Annual General Meeting.
Brief resume of the Directors retiring by rotation, nature
of their expertise in specific functional areas and names
AUDITORS
The Statutory Auditors of the Company, M/s. Brahmayya
& Co, Chartered Accountants, Hyderabad will retire at
the conclusion of ensuing Annual General Meeting and
are eligible for reappointment.
AUDITORS' QUALIFICATION
The qualification made by the Auditors in their report on
the accounts of the company for the year ended 31st
March, 2010 have been dealt with in the Notes on
Accounts, which are self-explanatory.
CONSERVATION OF ENERGY, TECHNOLOGY
ABSORPTION, FOREIGN EXCHANGE EARNINGS
AND OUTGO
The details as required under the Companies (Disclosure
of Particulars in the Report of Board of Directors) Rules,
1988 are given in Annexure - I.
DEPOSITS
The company has not invited/accepted deposits from the
public.
of Employees) Rules, 1975 and hence the prescribed

information is not required to be given.
ACKNOWLEDGEMENTS
The Board of Directors are pleased to place on record
their appreciation of the co-operation and support
extended by All India Financial Institutions, Banks and
various State and Central Government Agencies.
The Board would also like to thank the Company's
shareholders, customers, suppliers for the support and
the confidence which they have reposed in the
management. The Board place on record its appreciation
of the contribution made by employees at all levels for
their hard work, solidarity, cooperation and support
For and on behalf of the Board of Directors
EMPLOYEES
No Employee was in receipt of remuneration in excess
of the limits prescribed under Section 217 (2A) of the
Companies Act, 1956, read with Companies (Particulars
(B.N.Agarwal)
Chairman & Managing Director
ANNEXURE - I
ANNEXURE TO DIRECTORS' REPORT
Details as required under Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 read
with clause (e) of Subsection (1) of Section 217 of the Companies Act, 1956.
A.
CONSERVATION OF ENERGY
(a)
Energy conservation measures taken:

The Company is in the process of appointing a firm of consultants to suggest the measures to be implemented
for conservation of energy.
(b)
Additional investments and proposals, if any, being implemented for reduction of consumption of energy- Nil
(c)
Impact of the measures referred above for reduction of energy consumption and consequent impact on the
cost of production of goods.
The above measures have reduced the cost of production.
(d)
Total energy consumption and energy consumption per unit of production as per Form A is given below
FORM A
Form for disclosure of particulars with respect to conservation of energy
2009-2010
1.
2008-2009
Power & Fuel consumption

a)
2.
Purchased
Units
50006566
Total amount (Rs. lakhs)
1712.38
Rate / Unit (Rs.)
3.42
b) Own Generation
i)
Through Generator (LDO/HSD/FO)
Unit Nos.
197957
Unit per liter of Diesel Oil
3.00
Cost Per Unit (Rs.)
14.27
ii) Through Steam generation
N.A.
Turbine / Generator
N.A
COAL (Tonnes) (Specify the quality and where used) (E/F Grade, Process)
321
3.
Furnace Oil
N.A.
N.A.
4.
OTHERS/INTERNAL GENERATORS (Please give details)
N.A.
N.A.
Standards
(if any)
2009-10
2008-09
--
3.95
4.25
Furnace Oil
Nil
Nil
8.47
Coal (Specify Quality)
Nil
Nil
Nil
Others (Specify)
Nil
Nil
Nil
50731428
1739.14
3.43
52851
3.45
10.69
N.A.
N.A.
737
Consumption Per Unit of Production

Consumption
per Kg of Production
Electricity (no of units)
B.
TECHNOLOGY ABSORPTION
Efforts made in Technology absorption as per Form B.
FORM-B
Form of disclosure of particulars with respect to technology absorption
A.
B.
C.
Research and Development R & D

1.
Specific areas in which R&D

carried by the Company
The Company is having R&D in introduction and

development of value added products
2.
Benefits derived as a result of

the above R&D
New value added products were developed
3.
Future plan of action
To further develop more value added products and

improve the quality of the products
4.
Expenditure on R&D
Expenditure on in-house Research and Development has

been shown under respective heads of Expenditure in
the Profit & Loss Account as no separate account is
maintained
Technology absorption, adaptation and innovation

1.
Efforts, in brief, made towards technology

absorption, adaptation and innovation
The Company had adapted indigenous technology

and innovated upon the same.
2.
Benefits derived as a result the above

efforts, e.g., improvement, cost, reduction,
product development, import substitution, etc.
Product improvement, increase in yield, production

of high value added products.
3.
In case of imported technology (imported

during the last 5 years reckoned from the
beginning of the financial year) following
information may be furnished.
No technology has been imported during last five

years.
Technology imported
Nil
(b)
Year of import
Not applicable
(c)
Has technology been fully absorbed
Not applicable
(d)
If not fully absorbed, areas where this

has not taken place, reasons therefor
and future plans of action
Not applicable
FOREIGN EXCHANGE EARNINGS AND OUTGO:

(a)
10
(a)
Activities relating to exports initiatives taken

to increase exports development of new
export markets and export plans.
Exports of the Company amounts to Rs.3363 Lakhs to

various countries like China, U.S.A, Korea, Taiwan, Iran,
Hongkong, Italy, Spain, Brazil, Chile, Portugal etc. The
Company is exploring new markets for export of its
products
(b) Total foreign exchange used and earned

(Rs.in Lakhs)
i)
ii)
31st March,
2010
31st March,
2009
Foreign Exchange Earned
FOB Value of exports
3,307
2,172
CIF Value of exports
3,363
2,207
405
30
61
690
Foreign Exchange used

a.
Plant & Machinery
b.
Spare Parts
c.
Raw Materials
d.
Commission on exports
26
87
e.
Foreign Travel
14
11
For and on behalf of the Board of Directors
(B.N.Agarwal)
Date : May 20, 2010
11
MANAGEMENT DISCUSSION AND ANALYSIS REPORT

MANAGEMENT DISCUSSION AND ANALYSIS
FORMING PART OF THE ANNUAL REPORT
DISCUSSES BELOW THE FOLLOWING MATTERS
WITH REFERENCE TO THE COMPANY'S CORE
BUSINESS VIZ., YARN AND READYMADE
GARMENTS
Industry structure, developments and product wise
performance.
Indian Textile Industry
The textile industry meets one of the most basic needs
of people and plays a very important role in contributing
to industrial output, employment generation and export
earnings. It contributes about 4% to the GDP Growth,
14% to the Industrial Production, 18% of employment
in the industrial sector and 12% share in the countrys
export earnings.
The Textile Industry is the second largest employment
after agriculture. It is currently providing employment to
35 million people in India. Indirect employment including
the manpower engaged in agricultural based raw-material
production like cotton and related trade and handling
could be around another 60 million.
Textile export for the period April 2009 to Jan 2010 was
increased to US $ 18.6 billion from US $ 17.7 billion for
the corresponding period of the previous year.
The Government of India has introduced encouraging
policies so as to impetus to the process of rapid
modernization of the textile industry,
1. Technology Upgradation Fund Scheme (TUFS)
Sanction of subsidized term loans under TUFS has greatly
contributed for the modernization of the textile industry
in the country. In May 2010, the Ministry of Textile
12
informed a parliamentary panel that it proposes to allocate

US $ 785.2 million for the modernization of the Textitle
Industry.
2. Scheme for Integrated Textile Parks: The Scheme
(SITP) involves setting up of textile units with appropriate
infrastructure and facilities for spinning, texturising,
weaving, processing, apparels etc., integrated in a single
area.
To capitalize on opportunities in the export market,
specialized textile parks, apparel parks, EOUs and EPZs
have been set up with improved infrastructure. The
apparel parks operate as Special Purpose Vehicles and
are run independently by entrepreneurs.
The performance of each business segment of the
Company i.e. Yarn and Garments has been
comprehensively discussed in the Directors Report.
OPPORTUNITIES AND THREATS
Cotton production in India is increasing rapidly with the
introduction of Hybrid and BT cotton seed. This is
expected to ensure availability of quality cotton. The
Government of India has made a vision statement of
raising the country's market share in the world Textile to
7% by 2012. International textile market is expected to
reach 700 bn USD by 2012, this vision scenario of 7%
market share holds immense prospects of growth for
Spinning as well as Garment Industry.
RISKS AND CONCERNS
The competitive condition of the Indian Textile Exporters
is affected by sharp increases in cotton prices and of
other in-puts like power, wages, fluctuations in currency
and withdrawal of export incentives on cotton yarn
exports.
To over come this situation, the company will focus on

cost cutting strategies, development of new markets,
production of value added products and efficient
management of inventory levels.
Internal Control Systems and their adequacy.
The Company has an adequate internal control system
commensurate with the size and complexity of the
organization. The Company has undertaken a
comprehensive review of all internal control systems to
take care of the needs of the expanding size of the
Company and also upgraded the IT support systems. A
system of internal audit to meet the statutory requirement
as well as to ensure proper implementation of
management and accounting controls is in place. The
Audit Committee periodically reviews the adequacy of
the internal audit functions.
Material Developments in Human Resources /
Industrial Relations Front, including number of
people employed
There are no material developments in the Human
Resources area. The industrial relations have been
generally satisfactory. The Company has already concluded
long-term wage agreements with workers' unions of
Bhongir and Aliabad units and discussions are in advanced
stage with workmen union of Rajna unit for entering the
long-term wage agreement. The Company constantly
reviews the man power requirements and has a properly
equipped Department to take care of the requirements.
The total number of people employed by the Company
is 1378.
Discussion on financial performance
The Indian Textile Industry, which was badly hit by global
economic recession, has started showing signs of recovery

during the year. The company's operations have resulted
in a turn over of Rs. 188.65 crores registering an
impressive growth of 16.49% over and in a profit after
tax of Rs.3.05 crores against a loss of Rs.13.94 crores
during the previous year.
The production in Yarn division has shown a growth of
3.35% over the previous year. Yarn realizations has started
improving both in domestic and export markets.
The production at Readymade Garments Division has
shown a decent growth of about 50% over the previous
year. The market for Readymade Garments has continued
to be good showing growth over the previous year both
in volumes and realizations. The export market has picked
up. The rising price of cotton continues to be a cause of
concern.
The workings of the Yarn Division as well as the Garments
Division would have been much better, but for the power
cuts and frequent stoppage of operations due to agitations
particularly in the Units situated in Andhra Pradesh.
NOTE :
Readers are advised to kindly note that the above
discussion contains statements about risks, concerns,
opportunities, etc., which are valid only at the time of
making the statements. A variety of factors known/
unknown, expected or otherwise may influence the
financial results. These statements are not expected to
be updated or revised to take care of any changes in the
underlying presumptions.
Readers may therefore appreciate the context in which
these statements are made before making use of the
same.
13
CORPORATE GOVERNANCE REPORT

1.
BRIEF STATEMENT ON COMPANYS PHILOSOPHY ON CODE OF GOVERNANCE.

Suryavanshi's Corporate culture has meant working always proactively to meet the expectations of its customers,
shareholders, employees, business associates, the society at large and in complying with the dictates of the
regulatory frame work both in letter and spirit. The Company believes Corporate Governance is an effective
instrument for realisation of this corporate aim and accordingly endeavours to function with integrity in a transparent
environment.
2.
BOARD OF DIRECTORS :
a.
Composition and category of directors as on 31.03.2010 / Number of other Board of Directors or Committees
of which Member/Chairman.
Name of the
Directors
DIN No.
Category
No.of other
Directorships in
public limited
companies
No.of other Board

Committees of which
Member
Chairman
B.N.Agarwal
00042123
Chairman and
Managing Director
Promoter-Executive
Nil
Nil
Nil
Rajender Kumar Agarwal
00041892

Promoter-Executive
1 - Director
Nil
Nil
J.K.Agarwal
00041946
Executive Director
Promoter-Executive
1 - Director
Nil
D.K.Agarwal
00042156
Whole-time Director
Promoter-Executive
1 - Director
Nil
00083972
Director
Non-ExecutiveIndependent
2 - Chairman
7 - Director
Nil
Nil
Nil
Nil
Dr. A.Nageswara Rao
00013295
Director
4 - Director
Sri B.N.Rathi
00011259
Director
1 - Chairman
1 - Director
Nil
2
Nil
Nil
Sri G.Ganesh
02367317
IDBI Nominee Director
Nil
Nil
Nil
14
b.
Attendance of each Director at the Board of Directors Meeting and the last Annual General Meeting.
Name of the Directors
Number of Board Meetings

attended during the period
1st April, 2009 to 31st March, 2010
Whether present at the

previous
AGM
8
8
8
8
7
7
6
5
Yes
Yes
Yes
Yes
Yes
No
No
Yes
B. N. Agarwal
J.K. Agarwal
D. K. Agarwal
Sri R. Surender Reddy
Dr. A. Nageswara Rao
Sri B. N.Rathi
Sri G. Ganesh
RE-APPOINTMENT OF RETIRING DIRECTORS
As required by Clause 49 of the Listing Agreement on Corporate Governance, particulars of the Directors being
reappointed are provided hereunder:
Profiles of Directors retiring by rotation
Sri B.N.Rathi
Sri B.N.Rathi, B.A., is one of the leading Share and Stockbrokers for the last 28 years and he possess specialized
knowledge in Capital markets.
His Directorships of other public limited companies as on date are as follows:
1.
B.N.R.Udyog Limited
- Chairman
2.
B.N.Rathi Securities Limited
- Director
Sri B.N.Rathi is not holding any shares in the equity capital of the Company.
R. Surender Reddy
Sri R.Surender Reddy, Industrialist has been associated with the Company since 1983. He has long experience as a
Parliamentarian. He was elected to the Lok Sabha for 4 terms. He was also a Member of A.P.Legislative Assembly from
1974 to 1989 (4 terms ).
Sri R.Surender Reddy was also Director on the Board of Andhra Bank from 1968 till date of nationalization and
Chairman of Andhra Pradesh State Financial Corporation for 2 years.
The Directorships and Committee Memberships of other companies of Mr.R.Surender Reddy as on date are as follows:
1.
2.
3.
4.
5.
6.
7.
8.
9.
Hyderabad Race Club

Suryalatha Spinning Mills Limited
Suryalakshmi Cotton Mills Limited
Surana Telecom Limited
Bhagyanagar India Limited
L-Pack Polymers Limited
Lakshmi Finance & Industrial Corpn. Ltd.
Surya Kiran International Limited
Suryaamba Spinning Mills Limited
Chairman
Chairman
Director
Director
Director
Director
Director
Director
Director
Sri R.Surender Reddy is holding 1000 shares in the equity capital of the Company
15
Number of Board of Directors meetings held, dates on which held.

During the Financial year ended 31st March, 2010, Eight Board Meetings were held on 30-May-09, 15-Jun-09,
31-Jul-09, 31-Aug-09, 29-Sep-09, 15-0ct-09, 25-Jan-10 and 1st March, 2010.
3.
AUDIT COMMITTEE:
a)
b)
c)
Brief description of terms of reference

i)
Oversight of Company's financial reporting process and disclosure of financial information.
ii)
Review of financial statements before submission to Board.
iii)
Review of adequacy of internal control systems and internal audit functions.
iv)
Review of Company's financial and risk management policies.
Composition, name of members and Chairperson

1.
Sri R. Surender Reddy
2.
Sri Dr. Akkineni Nageshwara Rao - Member, Non-Executive & Independent
- Chairman, Non-Executive & Independent
3.
Sri J.K. Agarwal
- Member, Executive & Promoter
4.
Sri G. Ganesh
- Member, Non-Executive &Independent (Nominee of IDBI)
Meetings and attendance during the year

During the financial year March 31, 2010, Five Audit Committee Meeting was held on 30-May-09,
15-Jun-09, 31-Jul-09, 15-0ct-09, 25-Jan-10
Name
4.
No. of the Meetings attended
R.Surender Reddy
Dr.Akkineni Nageswara Rao
J.K. Agarwal
G.Ganesh (IDBI Nominee)
REMUNERATION COMMITTEE
a)
Brief description of terms of reference.

To formulate a remuneration policy and approve the remuneration or revision in the remuneration payable
to the Executive Directors.
b)
c)
Composition, Name of members and Chairperson

1.
- Chairman - Non-executive - Independent
2.
Sri B.N.Rathi - Member
- Non-executive - Independent
3.
Sri G.Ganesh - Member
- IDBI Bank Ltd., Nominee - Independent
Attendance during the year

During the financial year March 31, 2010, one Remuneration Committee Meeting was held on 31st August,
2009.
d)
Remuneration policy
To periodically review the remuneration package of whole time Directors and recommend suitable revision
to the Board.
16
e)
Details of remuneration to all the Directors, as per format in main report.

(During 01.04.2009 to 31.03.2010)
Name of the Directors
Designation
Salary &
Commission
(Rs.)
Perquisites
(Rs.)
Total
Remuneration
(Rs.)
10,80,000
6,14,400
16,94,400
B.N.Agarwal
Chairman and Managing Director
9,60,000
5,56,480
15,16,480
J.K.Agarwal
Executive Director
8,64,000
5,07,720
13,71,720
D.K.Agarwal
Whole-time Director
8,64,000
5,02,080
13,66,080
Sitting Fees
Name of the Director
Designation
Amount (Rs.)
Director
22,500
Dr. A.Nageswara Rao
Director
25,000
Sri B.N.Rathi
Director
15,000
Sri G.Ganesh
IDBI Nominee Director
15,500
The Company does not have any stock option plan or performance linked incentive for the Executive Directors.
The appointments are made for a period of five years on the terms and conditions in the respective resolution
passed by the Members in the General Meetings, which do not provide for severance fees.
5.
SHAREHOLDERS / INVESTORS GRIEVANCE COMMITTEE :

a)
Name of Non-Executive Director heading the Committee
Dr. A. Nageswara Rao
b)
Name and designation of Compliance Officer.
Sri B.R.S. Reddy, Vice President

(Corporate Affairs) & Company Secretary.
6.
c)
Number of Shareholders Complaints received so far
40
d)
Number not solved to the satisfaction of shareholders
NIL
e)
Number of pending share transfers
NIL
GENERAL BODY MEETINGS:

a)
Location and time, where last three AGMs held.

Financial Year
Date
Venue
Time
2006-2007
09/08/2007
Gayatri Gardens, Near Diamond Point Hotel,

Secunderabad - 500 009.
10.30 A.M.
2007-2008
26/09/2008

10.00 A.M.
2008-2009
30/09/2009

10.00 A.M.
17
b)
Whether Special resolutions were put through postal ballot last year, details of voting pattern..
NO
c)
Person who conducted the postal ballot exercise.

- NOT APPLICABLE -
d)
Whether any resolutions are proposed to be conducted through postal ballot.

Provisions of Companies Act, 1956 regarding passing of resolutions through postal ballot shall be complied
with whenever necessary.
e)
Procedure for postal ballot.

Prescribed procedure shall be complied with whenever necessary.
Special Resolutions:
Special Resolutions were passed at the Annual General Meeting held on 9th August 2007, 26th September, 2008 and
30th September, 2009
7.
DISCLOSURES
a)
Related Party Transactions: There were no materially significant related party transactions, which had potential
conflict with the interest of the Company at large. Transactions with the Related Parties are disclosed in
Note No. 19 of the Schedule 21 to the Accounts in the Annual Report.
b)
Details of non-compliance by the Company, penalties, strictures imposed on the Company by Stock Exchange
or SEBI or other authority on any matter related to capital markets, during the last three years: NIL
c)
CEO and CFO Certification: The Managing Director and Chief Financial Officer have given a certificate to
the Board as contemplated in Clause - 49 of the Listing Agreement.
Mandatory requirements: All complied with.

Non-mandatory requirements :
(i)
The Board : The Board is headed by an Executive Chairman.
(ii)
Remuneration Committee : Please refer to the Clause 4 above.
(iii) Shareholder Rights : Half-yearly reports is not being sent to each household of shareholders as shareholders
are intimated through the press and the Company's Website www.suryavanshi.com
(iv) Audit qualifications : There are no audit qualifications in the report.
(v)
Training of Board members : The Company shall work out a plan for training its Board members.
(vi) Mechanism for evaluating non-executive Board members : Not yet evolved.
(vii) Whistle Blower Policy : Not yet established.
8.
MEANS OF COMMUNICATION.
a)
Quarterly results.
Quarterly report is not being sent to each household of shareholders as shareholders are intimated through
the press and the Company's Website www.suryavanshi.com
b)
Quarterly results are normally published in which newspapers

The Quarterly results are usually published in Business Standard/Financial Express and Andhra Bhoomi/Vartha
Hyderabad editions.
c)
Any website, where displayed

www.suryavanshi.com
d)&e) Whether it also displays official news releases and the presentations made to institutional investors or to
the analysts.
The website shall be used for this purpose, when the occasion arises.
18
9.
GENERAL SHAREHOLDER INFORMATION

a)
AGM : Date, Time and Venue

Date
29th September, 2010
Time
10:00 A.M.
Venue
Gayatri Gardens, Survey No.26, Sikh Village, Near Diamond Point Hotel,
b)
Financial Year
1st April 2009 to 31st March 2010
c)
Date of Book Closure
24th September 2010 to 29th September, 2010 (Both days inclusive).
d)
Dividend Payment Date
Not applicable as the Board has not recommended any dividend
e)
Listing on Stock Exchanges & Stock Code

The Company's Shares are listed in the following Stock Exchanges.
Name of the Stock Exchange
The Bombay Stock Exchange Limited
f)
Code
514140
Phiroze Jeejeebhoy Towers,

Dalal Street, MUMBAI - 400001
Market Price Data: High, Low during each month in last financial year and Performance in comparison to
broad - based indices such as BSE Sensex.
Month
g)
Address
Share Price (Rs.)
Sensex
High
Low
High
Low
April-09
9.15
6.91
11,492.10
9,546.29
May-09
10.73
7.37
14,930.54
11,621.30
June-09
14.36
10.84
15,600.30
14,016.95
July-09
12.08
9.67
15,732.81
13,219.99
August-09
12.70
10.30
16,002.46
14,684.45
September-09
13.20
10.31
17,142.46
15,356.72
October-09
12.88
10.40
17,493.17
15,805.20
November-09
15.50
10.62
17,290.48
15,330.56
December-09
19.36
12.70
17,530.94
16,577.78
January-10
29.85
17.75
17,790.33
15,982.08
February-10
28.55
20.80
16,669.25
15,651.99
March-10
25.25
19.05
17,793.01
16,438.45
Registrar and Share Transfer Agents

M/s. Sathguru Management Consultants Pvt. Ltd.,
Plot No.15, Hindi Nagar, Behind Saibaba Temple,
Punjagutta, Hyderabad - 500 034.
Phone No(s) - 23356507, 23356975, 23350586,
Fax No - 40040554
19
h)
Share Transfer System:

The share transfers are processed and the share certificates are returned to the shareholders within a
maximum period of 30 days from the date of receipt, subject to the documents being valid and complete
in all respects.
i)
Shareholding pattern as on 31.03.2010.

Sr.No.
Category
Promoters
Mutual Funds
Banks & Financial Institutions
FII's
Private Corporate Bodies
NRI's
Indian Public
No.of
Shares held
Percentage
Shareholding
70,54,063
53.15
700
0.01
10,09,997
7.61
26,10,540
19.67
20,848
0.16
25,74,775
19.40
1,32,70,923
100.00
0.00
TOTAL
Distribution of shareholding
Nominal Value
Shareholders
Number
% to Total
In Rs.
% to Total
6401
90.79
82,44,980
6.21
Upto 5000
5001 - 10000
308
4.37
25,06,360
1.89
10001 - 20000
169
2.40
25,08,230
1.89
20001 - 30000
55
0.78
13,85,910
1.04
30001 - 40000
14
0.20
4,88,830
0.37
40001 - 50000
25
0.35
11,39,550
0.86
50001 - 100000
24
0.34
17,29,140
1.30
100001 and above
54
0.77
11,47,06,230
86.43
7050
100.00
13,27,09,230
100.00
TOTAL
j)
Amount
Dematerialisation of shares and liquidity

The Company's shares are available for dematerialisation on both the Depositories i.e, National Securities
Depository Limited (NSDL) and Central Depository Services (India) Limited (CDSL) 10072665 shares
amounting to 75.9% of the Capital have been dematerialised by investors as on 31st March, 2010.
ISIN : INE431C01015
Address of Registrars for Dematerialistion of Shares.
M/s.Sathguru Management Consultants Pvt.Ltd.,
Plot No.15,Hindi Nagar,Behind Saibaba Temple,
Punjagutta,Hyderabad - 500 034.
Phone No(s) - 23356507, 23356975, 23350586,
Fax No - 40040554
20
k)
Outstanding GDRs/ADRs/Warrants or any Convertible instruments, conversion date and likely impact on
equity.
NOT APPLICABLE as the Company has not issued any of the above instruments.
l)
Plant Locations
*
*
*
Bhongir - 508 116, Nalgonda District, Andhra Pradesh, India.

Aliabad, Shamirpet - 500 078, Medchal Taluq, R.R.District, Andhra Pradesh, India.
Nagpur - Bhopal Road, Rajna-480 340, Pandurna Taluq, Chindwara District, Madhya Pradesh, India.
m) Address for correspondence :

i)
for transfer / dematerialisation of share, change of address of members and other queries relating to the
shares of the Compnay:
M/s.Sathguru Management Consultants Pvt.Ltd.,
Plot No.15,Hindi Nagar,Behind Saibaba Temple,
Punjagutta,Hyderabad - 500 034.
Phone No(s) - 23356507, 23356975, 23350586.
Fax No - 40040554
ii)
any queries relating to dividends of earlier years and annual reports, etc.
The Company Secretary,
Suryavanshi Spinning Mills Limited,
6th Floor, Surya Towers, 105, S.P.Road, Secunderabad - 500 003.
Phone No: 040 - 30512700
Fax No : 040 - 30512725
Email ID : [email protected]
The above report has been approved by the Board of Directors in their meeting held on May 20, 2010.
Declaration on Code of Conduct

This is to confirm that all Directors and Senior Management personnel of the Company have affirmed compliance with
the Code of Conduct of the Company for the financial year ended on 31st March, 2010 as envisaged in clause 49 of
the Listing Agreement with Stock Exchanges.
for SURYAVANSHI SPINNING MILLS LIMITED

B.N. Agrawal
Date : 20th May, 2010.
21
Auditors' Certificate on compliance of Corporate Governance

To the Members of SURYAVANSHI SPINNING MILLS
LIMITED, SECUNDERABAD.
has complied with the conditions of Corporate

Governance as stipulated in the above listing agreement.
We have examined the compliance of conditions of

Corporate Governance by SURYAVANSHI SPINNING
MILLS LIMITED, SECUNDERABAD, A.P. for the year
ended on 31st March, 2010, as stipulated in Clause 49 of
the Listing Agreement of the said Company with stock
exchanges in India.
We state that in respect of investor grievances received

during the year ended 31st March, 2010, no investor
grievances are pending against the Company as per the
records maintained by the Company. We further state
that such compliance is neither an assurance as to the
future viability of the Company nor the efficiency or
effectiveness with which the management has conducted
the affairs of the Company.
The compliance of conditions of Corporate Governance

is the responsibiity of the management. Our examination
was limited to the procedures and implementation thereof
adopted by the Company for ensuring the compliance of
the conditions of Corporate Goverance. It is neither an
audit nor an expression of an opinion to the financial
statements of the Company.
In our opinion and to the best of our information and
according to the explanations given to us, the Company
22
For BRAHMAYYA & CO.,

Chartered Accountants
Firm Regn. No.000513S
Place : Hyderabad
K S RAO
Partner
Membership No.15850
AUDITORS' REPORT
To the Members of
SURYAVANSHI SPINNING MILLS LIMITED,
SECUNDERABAD.
1.
2.
3.
4.
We have audited the attached Balance Sheet of

SURYAVANSHI SPINNING MILLS LIMITED,
SECUNDERABAD (A.P) as at 31st March, 2010
and also the Profit and Loss Account and the Cash
Flow Statement for the year ended on that date
annexed thereto. These financial statements are the
responsibility of the Company's Management. Our
responsibility is to express an opinion on these
financial statements based on our audit.
We conducted our audit in accordance with the
auditing standards generally accepted in India. Those
Standards require that we plan and perform the
audit to obtain reasonable assurance about whether
the financial statements are free of material
misstatement. An audit includes examining, on a
test basis, evidence supporting the amounts and
disclosures in the financial statements. An audit also
includes assessing the accounting principles used and
significant estimates made by management, as well
as evaluating the overall financial statement
presentation. We believe that our audit provides a
reasonable basis for our opinion.
As required by the Companies (Auditors' Report)
Order, 2003, issued by the Central Government of
India in terms of sub-section (4A) of Section 227 of
the Companies Act, 1956, we enclose in the
Annexure a statement on the matters specified in
paragraphs 4 and 5 of the said Order.
iv)
In our opinion, the Balance Sheet, Profit and

Loss account and Cash Flow Statement dealt
with by this report comply with the accounting
standards referred to in sub-section (3C) of
Section 211 of the Companies Act, 1956;
v)
On the basis of written representations

received from the directors, as on 31st March,
2010 and taken on record by the Board of
Directors, we report that, none of the
directors is disqualified as on 31st March, 2010
from being appointed as a Director in terms
of clause (g) of sub-section (1) of Section 274
of the Companies Act, 1956;
vi)
In our opinion and to the best of our

information and according to the explanations
given to us, the said accounts read in
conjunction with the Schedules annexed
therewith, subject to Note No.2 of Schedule
21, give the information required by the
Companies Act, 1956, in the manner so
required and give a true and fair view in
conformity with the accounting principles
generally accepted in India :
a)
in the case of the balance sheet, of the

state of affairs of the Company as at 31st
March, 2010;
b)
in the case of the profit and loss account,

of the Profit of the Company for the year
ended on that date; and
c)
in the case of cash flow statement, of

the cash flows for the year ended on
that date.
Further to our comments in the Annexure referred

to above, we report that :
i)
We have obtained all the information and

explanations which to the best of our
knowledge and belief were necessary for the
purposes of our audit.
ii)
In our opinion, proper books of account as

required by law have been kept by the
Company so far as appears from our
examination of those books.
iii)
The Balance Sheet, Profit and Loss Account

and Cash Flow statement dealt with by this
report are in agreement with the books of
account.

Firm Regn. No.000513S
K S RAO
Partner
Membership No.15850
Place : Hyderabad
23
ANNEXURE TO THE AUDITORS' REPORT

Referred to in paragraph 3 of our report of even date.
1)
2.
a)
The Company has maintained proper records showing full particulars, including quantitative details and
situation of fixed assets.
b)
As explained to us, the management has physically verified most of the fixed assets during the year and there
is a regular programme of verification which, in our opinion, is reasonable having regard to the size of the
Company and the nature of the assets. No material discrepancies were noticed on such verification.
c)
The fixed assets disposed off during the year are not substantial and hence it has not affected the going
concern status of the Company.
a)
The inventory has been physically verified during the year by the management. In our opinion, the frequency
of verification is reasonable.
b)
In our opinion, the procedures of physical verification of inventories followed by the management are
reasonable and adequate in relation to the size of the company and the nature of its business.
c)
The Company is maintaining proper records of inventory. The discrepancies noticed on physical verification
between the physical stocks and book records were not material.
3.
The Company has not taken/granted any loans, secured or unsecured to Companies, firms or other parties
covered in the Register maintained under Section 301 of the Act. Hence, provisions of clause (iii), (b), (c), (d), (f)
and (g) of paragraph 4 are not applicable to the Company.
4.
In our opinion and according to the information and explanations given to us, there are adequate internal control
systems commensurate with the size of the Company and the nature of its business with regard to purchase of
inventory and fixed assets and with regard to sale of goods and services. During the course of our audit, we have
not observed any continuing failure to correct major weaknesses in internal control system.
5.
a)
In our opinion and according to the information and explanations given to us, we are of the opinion that the
particulars of contracts or arrangements referred to in section 301 of the Companies Act, 1956 have been
entered in the register to be maintained under that section.
b)
In our opinion and according to the information and explanations given to us, the transactions made in
pursuance of contracts or arrangements entered in the register maintained under section 301 of the Companies
Act,1956 have been made at prices which are reasonable having regard to prevailing market prices at the
relevant time.
6.
The Company has not accepted deposits from the public. Hence the provisions of Section 58A, 58AA and other
relevant provisions of the Companies Act, 1956 and the Companies (Acceptance of Deposits) Rules, 1975 are not
applicable to the Company for the time being.
7.
In our opinion, the Company has an internal audit system commensurate with its size and nature of its business.
8.
We have broadly reviewed the books of account relating to materials, labour and other items of cost maintained
by the company pursuant to the Rules made by the Central Government for the maintenance of cost records
under section 209(1)(d) of the Companies Act, 1956 in respect of yarn and are of the opinion that prima facie
the prescribed accounts and records have been made and maintained.
24
9.
a)
According to the records the Company is regular in depositing with appropriate authorities undisputed
statutory dues including Provident Fund, Investor Education and Protection Fund, Employees' State Insurance,
Income-tax, Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty, Cess and other material statutory
dues applicable to it.
b)
According to the information and explanations given to us, no undisputed amounts payable in respect of
Income-Tax/Sales Tax, Wealth Tax, Service Tax, Custom Duty, Excise Duty and Cess were in arrears, as at
31st March, 2010.
10. The Company has accumulated losses as at the end of the financial year. The Company has not incurred cash losses
during the financial year covered by our audit. However the Company incurred cash losses in the immediately
preceding financial year.
11. In our opinion and according to the information and explanations given to us, the Company has not defaulted in
repayment of dues to any financial institutions and banks.
12. The Company has not granted any loans and advances on the basis of security by way of pledge of shares,
debentures and other securities.
13. The Company is not a chit fund or a nidhi/mutual benefit fund/society. Therefore, the provisions of clause 4(xiii)
of the Companies (Auditor's Report) Order, 2003 are not applicable to the Company.
14. The Company is not dealing or trading in shares, securities, debentures and other investments. Therefore, the
provisions of clause 4(xiv) of the Companies (Auditor's Report) Order, 2003 are not applicable to the Company.
15. According to the information and explanations given to us, the Company has not given any guarantee for loans
taken by others from banks or financial institutions.
16. In our opinion and according to the information and explanations given to us the term loans were applied for the
purpose for which the loans were raised.
17. In our opinion and according to the information and explanations given to us the funds raised on short-term basis
have been used for long-term investment.
18. During the year, the Company has issued 19,50,000 Equity Shares Rs.10/- each at a premium of Rs.5/-. In our
opinion the price at which the shares have been issued is not prejudicial to the interest of the company.
19. During the year, the Company has not issued any debentures and therefore the question of creating security or
charge in respect thereof does not arise.
20. During the year, the Company has not made any public issue and therefore the question of disclosing the end use
of money raised by public issue does not arise.
21. Based upon the audit procedures performed and according to the information and explanations given to us, we
report that no fraud on or by the Company has been noticed or reported during the year.
Firm Regn. No. 000513S
Place : Hyderabad
K S RAO
Partner
Membership No.15850
25
BALANCE SHEET AS AT 31st MARCH, 2010

Schedule
Reference
As at
31.03.2010
Rs
SOURCES OF FUNDS:
SHARE HOLDERS' FUNDS:
Share Capital
Reserves and Surplus
LOAN FUNDS:
Secured Loans
Unsecured Loans
1
2
LESS: CURRENT LIABILITIES

AND PROVISIONS
Rs
40,99,49,509
38,06,99,509
85,43,99,266
4,02,29,572
82,42,86,956
5,31,80,940
1,30,45,78,347
1,25,81,67,405
5
1,66,71,42,626
89,27,56,541
1,64,14,74,698
82,29,48,048
77,43,86,085
22,83,346
81,85,26,650
12,32,006
77,66,69,431
1,60,750
7
8
9
10
11
81,97,58,656
1,60,750
40,43,24,450
15,37,05,633
5,63,57,459
16,73,96,492
23,86,29,678
12,36,14,399
3,19,11,740
12,90,03,637
78,17,84,034
52,31,59,454
30,96,76,808
17,10,03,698
47,21,07,226
35,21,55,756
5,56,40,940
8,60,92,243
1,30,45,78,347
1,25,81,67,405
Net Current Assets

Profit and Loss Account
TOTAL
NOTES ON ACCOUNTS AND
ACCOUNTING POLICIES
Rs
1,13,186,730
26,75,12,779
3
4
Net Block
Add:Capital Works in Progress
INVESTMENTS
CURRENT ASSETS,
LOANS AND ADVANCES:
Inventories
Sundry Debtors
Cash and Bank Balances
Loans and Advances
Rs
13,26,86,730
27,72,62,779
TOTAL
APPLICATION OF FUNDS:
FIXED ASSETS:
Gross Block
Less: Depreciation
As at
31.03.2009
21
The Schedules referred to above form an integral part of balance sheet

As per our report of even date
for BRAHMAYYA & CO.,
K.S. RAO
Partner
Membership No. 15850
Place : Hyderabad
Date : 20.05.2010
26
For and on behalf of the Board

K.N. NEVATIA
General Manager
(Finance & Accounts)
B.R.S. REDDY
Vice President (Corp. Affairs)
and Company Secretary
B.N. AGARWAL
R.K. AGARWAL
Director
PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31st MARCH, 2010
Schedule
Reference
For the
Year ended
31-03-2010
(Rs.)
For the
Year ended
31-03-2009
(Rs.)
18,71,843,125
1,46,18,748
1,60,44,68,865
1,49,95,619
1,88,64,61,873
1,61,94,64,484
1,14,28,15,325
3,69,98,124
5,27,71,365
17,62,63,051
13,42,62,734
16,07,36,828
8,75,03,035
7,40,47,059
(94,36,822)
1,03,76,67,744
4,81,41,783
17,79,19,725
11,65,18,492
15,44,15,564
9,74,07,631
7,34,66,548
5,24,23,163
2,77,957
1,85,59,60,699
1,75,82,38,607
3,05,01,174
(13,87,74,123)
49,871
24,885
6,00,000
Profit after Taxation

Profit/(Loss) brought forward from Previous Year
3,04,51,303
(8,60,92,243)
(13,93,99,008)
5,33,06,765
Balance Carried to Balance Sheet
(5,56,40,940)
(8,60,92,243)
2.29
(12.32)
INCOME:
Net sales
Other Income
12
13
TOTAL
EXPENDITURE:
Raw Materials Consumed
Cost of Traded Goods
Stores Consumed
Power and Fuel
Payments and Benefits to Employees
Other Expenses
Finance Charges
Depreciation
Decrease/(Increase) in Stocks
Miscellaneous Expenditure W/off
14
15
16
17
18
19
5
20
TOTAL
Profit/(Loss) for the year
Less : Provision for :
- Wealth Tax of earlier years
- Short provision of income tax of earlier years
- Fringe Benefit Tax
Earnings per Share (refer : 20 of Sch. : 21)

NOTES ON ACCOUNTS AND
ACCOUNTING POLICIES
21
The schedules referred to above form an integral part of Profit and Loss Account.
K.S. RAO
Partner
Place : Hyderabad
Date : 20.05.2010

K.N. NEVATIA
General Manager
B.R.S. REDDY
B.N. AGARWAL
R.K. AGARWAL
Director
27
SCHEDULES FORMING PART OF THE ACCOUNTS

As at
31.03.2010
Rs.
As at
31.03.2009
Rs.
35,25,00,000
35,25,00,000
13,27,09,230
11,32,09,230
22,500
22,500
13,26,86,730
11,31,86,730
SCHEDULE - 1
SHARE CAPITAL:
Authorised:
3,52,50,000 Euity Shares of Rs.10/- each
Issued, Subscribed and Paid up:
1,32,70,923 (Previous year 1,13,20,923) Equity Shares of
Rs.10/- each fully paid up
(of the above 21,00,000 Equity Shares of Rs.10/- each
are allotted as fully paid up by way of Bonus Shares by
Capitalisation of Reserves and 41,62,536Equity Shares of
Rs.10/- each are allotted for consideration other than cash)
Less: Allotment Money in Arrears
(Dues from Directors Rs. Nil)
TOTAL
SCHEDULE - 2
RESERVES AND SURPLUS:
Balance
as at
31.03.2009
Rs.
Additions
during the
year
Rs.
Deductions
during the
year
Rs.
Balance
as on
31.03.2010
Rs.
26,33,49,719
97,50,000
27,30,99,719
8,00,000
8,00,000
State Subsidy
22,63,060
22,63,060
Export Allowance Reserve
11,00,000
1,100,000
26,75,12,779
97,50,000
27,72,62,779
Reserves :
Security Premium Account
Capital Redemption Reserve
TOTAL
28

As at
31.03.2010
Rs.
As at
31.03.2009
Rs.
2,57,19,903
15,79,84,895
4,28,36,292
16,35,00,000
2,00,00,000
4,42,00,000
1,78,00,000
2,98,78,247
16,99,84,895
5,04,15,249
16,70,54,928
2,00,00,000
4,65,00,000
4,94,64,000
11,80,444
33,41,292
48,42,249
73,065
1,17,876
52,30,62,826
49,18,30,509
21,78,15,377
7,65,80,208
3,40,55,159
20,54,62,358
8,54,65,620
3,77,28,750
32,84,50,744
32,86,56,728
SCHEDULE - 3
SECURED LOANS:
A)
Term Loans:
1)
B)
C)
Rupee Term Loan from :

a) ICICI Bank Ltd.
b) IDBI Bank Ltd.
c) State Bank of India IFB
d) Bank of Rajasthan Ltd.
e) Andhra Bank
f) Andhra Bank - WCTL
g) State Bank of Hyderabad - WCTL
2)
Buyers Credit from State Bank of India, Tokyo

(Against L C from Andhra Bank)
3)
Interest accrued and Due

a) IDBI Bank Ltd.
b) Andhra Bank
c) ICICI Bank Ltd.
Working Capital Loans from:

Andhra Bank
State Bank of Hyderabad
ICICI Bank Ltd.
Vehicle Loans
TOTAL
28,85,696
37,99,719
85,43,99,266
82,42,86,957
NOTES:1. The Term Loans referred in (1) & (2) above are secured by way of mortgage of
present and future fixed assets of the company except WCTL on pari passu. All the
term loans are guaranteed by four Directors of the Company.
2.
The Working Capital Loans and WCTL are Secured by way of hypothecation of
Raw materials, Stock-in-process, finished goods and stores and spares and book
debts of the Company and also secured by way of second charge on fixed assets
of the company on pari passu basis and guranteed by four Directors of the Company.
SCHEDULE - 4
UNSECURED LOANS
Sales Tax Deferment
Inter Corporate Deposits
TOTAL
4,02,29,572
3,92,49,500
1,39,31,440
4,02,29,572
5,31,80,940
29
30
4
5
6
7
8
9
10
11
12
13
14
15
16
1
2
3
No.
Sl.
As at
01.04.2009
Rs.
15,88,523
18,29,00,505
1,57,71,74,296
Previous Year
6,76,27,475
3,12,96,555
3,32,22,577
19,26,022
1,64,27,06,704
1,64,27,06,704
3,09,39,231
22,83,346
24,620
4,69,342
2,70,712
2,95,207
17,61,785
2,26,938
2,51,727
2,950
0
1,18,02,471
1,53,26,354
5,07,125
Rs.
As at
31.03.2010
Rs.
15,88,523
18,34,07,630
20,95,067 1,64,27,06,704
52,71,303 1,66,94,25,972
71,97,325 1,66,94,25,972
19,26,022
52,71,303 1,66,71,42,626
19,26,022
22,83,346
2,31,52,448
2,38,49,816
43,52,803 1,28,93,46,920
4,70,75,087
49,67,540
15,188
4,71,11,328
9,91,673
12,43,904
34,78,570
50,68,855
36,50,171
22,39,891
9,18,500
1,97,37,720
1,02,17,362
Rs.
ADDITIONS DELETIONS
GROSS BLOCK
1,64,14,74,698
12,32,006
TOTAL
Less: Internal transfer
TOTAL
Add:Capital Work in Progress
LAND
FACTORY BUILDINGS
NON-FACTORY BUILDINGS
NON-RESIDENTIAL
2,31,52,448
RESIDENTIAL
1,20,47,345
PLANT & MACHINERY
1,27,83,73,369
GENERATORS
4,70,75,087
TESTING EQUIPMENT
49,67,540
CANTEEN EQUIPMENT
15,188
ELECTRICAL INSTALLATIONS
4,68,59,601
WORKSHOP EQUIPMENT
9,88,723
WEIGHING MACHINES
12,43,904
WATER WORKS
34,53,950
FURNITURE
45,99,513
OFFICE EQUIPMENT
33,79,459
AIR CONDITIONER
19,44,684
VEHICLES
1,88,94,435
DATA PROCESSING EQUIPMENT
99,90,424
DESCRIPTION
FIXED ASSETS
SCHEDULE - 5
75,04,44,784
82,29,48,048
82,29,48,048
82,29,48,048
39,76,801
28,60,263
66,23,24,917
4,13,28,457
31,21,682
961
2,39,46,804
9,42,287
9,37,882
8,60,906
31,63,402
16,99,039
10,34,381
49,59,338
86,91,071
6,30,99,857
Upto
31.03.2009
Rs.
7,34,66,548
7,40,47,061
7,40,47,061
7,40,47,061
1,72,438
4,25,580
6,07,57,735
15,55,579
1,93,501
721
21,81,219
8,616
54,256
56,369
1,95,802
1,38,314
69,301
18,69,296
2,80,427
60,87,907
For the
year
Rs.
9,63,284
42,38,568
42,38,568
42,38,568
3,73,654
38,64,914
Rs.
Deduction
DEPRECIATION
82,29,48,048
89,27,56,541
89,27,56,541
89,27,56,541
41,49,239
32,85,843
71,92,17,738
4,28,84,036
33,15,183
1,682
2,61,28,023
9,50,903
9,92,138
9,17,275
33,59,204
18,37,353
11,03,682
64,54,980
89,71,498
6,91,87,764
Upto
31.03.2010
Rs.
81,97,58,656
77,66,69,431
77,66,69,431
77,43,86,085
22,83,346
1,90,03,209
2,05,63,973
57,01,29,182
41,91,051
16,52,357
13,506
2,09,83,305
40,770
2,51,766
25,61,295
17,09,651
18,12,818
11,36,209
1,32,82,740
12,45,864
As at
31.03.2010
Rs.
15,88,523
1,14,219,866
82,67,29,512
81,97,58,656
81,97,58,656
81,85,26,650
12,32,006
1,91,75,647
91,87,082
61,60,48,452
57,46,630
18,45,858
14,227
2,29,12,797
46,436
3,06,022
25,93,044
14,36,111
16,80,420
9,10,303
1,39,35,097
12,99,353
As at
31.03.2009
Rs.
15,88,523
11,98,00,648
NET BLOCK

As at
31.03.2010
Rs.
As at
31.03.2009
Rs.
SCHDEULE - 6
INVESTMENTS - LONG TERM - AT COST - NON - TRADED
Face Value
No.of
- Quoted
Shares
Jindal Polyester & Steels Ltd
10
500
48,750
48,750
Artefact Software & Finance Ltd
10
2000
20,000
20,000
Merbanc Finance & Services Ltd
10
2000
20,000
20,000
Andhra Bank
10
5700
57,000
57,000
ICICI Bank Ltd
10
100
3,500
3,500
1,49,250
1,49,250
Aggregate market value of Quoted

Investments of Rs.10,70,465/(Previous year Rs.4,77,925/-)
- Unquoted
National Savings Certificates of the
year 1980 (Pledged as security with
11,500
11,500
Central Excise Dept.)
11,500
11,500
1,60,750
1,60,750
25,61,09,260
2,55,51,727
6,71,38,686
4,20,99,184
10,34,860
1,23,90,733
10,06,98,659
2,47,04,378
7,16,70,909
3,46,76,091
8,18,254
60,61,387
40,43,24,450
23,86,29,678
72,10,361
14,64,95,272
1,09,09,663
11,27,04,736
15,37,05,633
12,36,14,399
TOTAL
SCHEDULE - 7
INVENTORIES:
(Valued and certified by the Management.
Valued at cost unless otherwise stated)
Raw Materials
Stores & Spares
Yarn (Lower of Cost or Net reliasable value)
Stock-in-Process
Waste Cotton (at Realisable value)
Garments (Lower of Cost or Net reliasable value)
TOTAL
SCHEDULE - 8
SUNDRY DEBTORS:
(Unsecured, considered Good)
Due over Six Months
Others
TOTAL
31

As at
31.03.2010
Rs.
As at
31.03.2009
Rs.
11,66,466
1,52,123
In Current Accounts (Note 1)
2,08,74,181
1,10,54,093
In Margin Money Deposits (Note 2)
3,43,14,812
2,07,03,524
2,000
2,000
5,63,57,459
3,19,11,740
SCHEDULE - 9
CASH & BANK BALANCES:
Cash on Hand
Balance With Scheduled Banks:
With Post Office:

In Savings Bank Account
(Deposit kept as security with Central
Excise Departments)
TOTAL
1.
2.
Current accounts includes unpaid dividend of Rs. 3,94,241/-(Previous year 400,405/-).

Deposits are Pledged with Andhra Bank and State Bank of Hyderabad
against guarantees and Letter of Credits.
SCHEDULE - 10
LOANS & ADVANCES:
(Unsecured, considered good, recoverable
in cash or in kind or for value to be received)
Advances to Supplies & Others
2,62,36,171
24,50,303
Advances to Employees
9,32,655
13,47,729
Advance to Land
5,49,000
49,000
Balance with Governament Department

Deposits Recoverable
Deposits Paid under protest
Subsidies Receivable
Interest Receivable
77,65,208
70,62,941
2,43,87,365
2,52,56,685
14,49,189
55,34,651
1,40,46,394
91,14,595
42,82,705
21,49,221
6,17,62,590
5,32,02,182
12,39,579
12,15,622
Advance Tax & TDS Receivable (Net)
42,64,114
38,33,181
Other Receivable
26,93,994
1,77,87,528
1,77,87,528
16,73,96,492
12,90,03,638
Export Licence/Receivable
Pre-paid Expenses
MAT Credit entitlement

TOTAL
32

As at
31.03.2010
Rs.
As at
31.03.2009
Rs.
SCHEDULE - 11
CURRENT LIABILITIES & PROVISIONS:
CURRENT LIABILITIES :
Sundry Creditors for:
-
Due to Micro and small enterprices
Others
Sundry Creditors for Expenses

Sundry Creditors for Others
11,30,673
2,65,895
24,36,56,217
9,81,34,158
6,02,07,124
4,72,25,450
17,95,929
1,15,25,290
Unclaimed Dividend *
3,94,241
4,00,405
Security Deposits Payable
5,28,190
20,38,190
19,64,434
1,14,14,310
30,96,76,808
17,10,03,698
Advances Received against Sales

TOTAL
* There is no amount due and outstanding to be credited to Investor Educational Protection fund
33

For the
Year ended
31-03-2010
(Rs.)
For the
Year ended
31-03-2009
(Rs.)
1,56,35,79,530
23,99,58,032
6,83,05,563
1,36,82,98,365
16,69,38,817
6,92,31,683
1,87,18,43,125
1,60,44,68,865
30,55,044
30,04,104
1,52,582
24,77,780
26,750
12,13,843
21,59,763
2,37,849
4,19,705
46,19,308
2,56,124
78,21,323
12,20,200
15,075
6,03,886
11,64,261
10,96,293
70,477
1,46,18,748
1,49,95,619
SCHEDULE -14
MATERIALS CONSUMED:
OPENING STOCK
Add: Purchases
10,06,98,659
1,29,82,25,926
9,23,53,500
1,04,60,12,903
Less: Closing Stocks
1,39,89,24,585
25,61,09,260
1,13,83,66,403
10,06,98,659
1,14,28,15,325
1,03,76,67,744
2,51,11,661
2,76,59,704
2,38,13,722
2,43,28,061
5,27,71,365
4,81,41,783
SCHEDULE - 12
SALES:
Yarn and Fabric
Garments
Cotton Waste and Others
TOTAL
SCHEDULE - 13
OTHER INCOME:
Interest earned
(TDS of Rs.3,14,069 /Previous Year of Rs. 3,11,185)
Job Work Charges
Sale of scrap
Divinded Recevied
Insurance Claims
Profit on Sale of Fixed Assets
Credit Balance Written Back
Excess provision written back
Foreign exchange fluctuation
Miscellaneous Receipts
TOTAL
TOTAL
SCHEDULE - 15
STORES CONSUMED:
Consumable Stores
Packing Materials
TOTAL
34

For the
Year ended
31-03-2010
(Rs.)
For the
Year ended
31-03-2009
(Rs.)
SCHEDULE - 16
POWER & FUEL:
Electricity Charges
Fuel Consumed
17,12,37,671
50,25,380
17,39,13,829
40,05,896
TOTAL
17,62,63,051
17,79,19,725
11,78,37,478
71,60,703
29,49,658
63,14,895
10,30,29,628
62,28,631
26,81,242
45,78,991
13,42,62,734
11,65,18,492
8,67,550
2,98,01,752
1,25,46,456
8,39,941
18,72,877
1,04,68,481
59,48,680
1,24,000
1,61,599
1,29,19,362
2,41,80,305
36,10,973
2,00,746
19,87,485
27,96,136
2,96,57,654
26,60,684
55,39,415
1,89,360
79,840
2,73,952
1,37,22,116
2,87,464
8,48,626
3,75,84,531
1,51,639
1,31,45,366
7,46,736
21,69,776
66,20,744
59,03,200
91,788
1,73,597
1,26,46,085
2,67,37,472
35,08,275
1,91,371
13,44,764
13,96,239
1,90,71,030
20,52,523
55,89,064
49,275
45,000
7,82450
1,06,81,528
28,84,485
16,07,36,828
15,44,15,564
SCHEDULE - 17
PAYMENTS AND BENEFITS TO EMPLOYEES:
Salaries, Wages and Bonus
Contribution to Provident Fund and ESI
Gratuity
Welfare Expenses
TOTAL
SCHEDULE - 18
OTHER EXPENSES:
Rent
Rates & Taxes
Security Charges
Training Charges
Printing & Stationery
Postage, Telegrams and Telephones
Travelling & Conveyance
Managerial Remuneration
Directors' Sitting Fees & Expenses
Advertisement
Commission on Sales
Expenses on Sales
Insurance
Auditors' Remuneration
Legal & Professional Charges
Repairs to : Buildings
: Machinery
: Other Assets
Vehicle Maintenance
Bad debts and Debit balance written off
Donations
Loss on Sale of Fixed Assets
Miscellaneous Expenses
Prior Period Expenses
TOTAL
35

For the
Year ended
31-03-2010
(Rs.)
For the
Year ended
31-03-2009
(Rs.)
Interest on Term Loans
4,88,75,745
4,44,24,281
Interest on Working Capital Loans
SCHEDULE - 19
FINANCE CHARGES
2,86,15,085
4,07,00,956
Interest on Others
51,67,461
44,38,667
Bank & Finance Charges
48,44,744
78,43,727
8,75,03,035
9,74,07,631
7,16,70,905
10,54,90,930
TOTAL
SCHEDULE - 20
(INCREASE) /DECREASE IN STOCKS:
Opening Stocks:
Yarn
Cotton waste
8,18,258
13,25,942
60,61,387
4,93,08,597
3,46,76,091
95,24,335
11,32,26,641
16,56,49,804
Yarn
6,71,38,686
7,16,70,905
Garments
1,23,90,733
60,61,387
Stock-in-Process
4,20,99,184
8,18,258
10,34,860
3,46,76,091
12,26,63,463
11,32,26,641
(94,36,822)
5,24,23,163
Stock-in-Process
Garments
TOTAL (A)
Closing Stocks:
Cotton waste
TOTAL (B)
(INCREASE)/DECREASE IN STOCKS:
36

SCHEDULE-21
I.
Notes Forming part of the Balance sheet as at 31st March,2010 and Profit & Loss Account for the year
ended on that date
Contingent liabilities not provided for on account of:

a) Foreign Bills Discounted
b) Letters of Credit - Inland
- Foregin
c) Bank Guarantees
As at
31.03.2010
Rs.
As at
31.03.2009
Rs.
4,46,09,128
71,91,922
71,04,335
4,14,01,216
5,40,29,771
71,91,922
2.
During the year 2005-06, the company recognized an income of Rs.653.06 Lakhs being export incentive under
the Target Plus Scheme in terms of the then prevailing Foreign Trade Policy. The Govt., of India, Ministry of
Commerce vide their Notification No.8(RE-2006)/ 2004-09 dated 12.06.06 retrospectively reduced the benefit of
entitlement from 15% to 5% on the exports effected since 01.04.2005. The company has since received duty free
credit entitlement for Rs.217.68 Lakhs @ 5% and for the balance 10%, the Company has contested before the
Hon'ble High Court at Mumbai for the restrospective reduction of the export incentive by the Government of
India. The High Court has granted an interim stay of the notification and the matter is pending for final orders.
3.
The Government of Andhra Pradesh has extended the incentive of Sales Tax deferral scheme, to the company
pursuant to which the company can avail the deferment of Sales Tax liability on sales effected out of production
from the units of Bhongir, Nalgonda Dist and Aliabad, R.R.Dist to the extent of Rs.20.80 Crores and Rs.9.05 Crores
respectively. The Deferred Sales Tax is repayable after expiry of 14 years from the year of availment. The
Company has availed a Sales Tax Deferrment of Rs.3,25,75,628/- (Previous Year Rs.3,15,95,556/-) in case of
Bhongir Unit up to 31st March, 2010 and Rs.76,53,944 in case of Aliabad Unit upto 31st March, 2009. The Aliabad
Unit has not availed Sales Tax Deferrment during the year 2009-10. The repayment of said Sales Tax Deferrment
shall commences from the years 2011 & 2016 for Bhongir and Aliabad Units respectively. The repayment schedule
is given below:
Financial year
Amount
2010-11
2011-12
2012-13
2013-14
2014-15
2015-16
2016-17
2017-18
2018-19
2019-20
2020-21
2021-22
2022-23
2023-24
39,583
7,04,167
5,34,923
1,46,647
14,71,150
45,68,734
28,82,317
67,48,919
34,87,821
75,58,755
70,81,635
14,77,864
25,46,985
9,80,072
TOTAL
4,02,29,572
37
4.
Balances of Debtors, Creditors, Advances and Loans etc are subject to confirmations and reconciliations.
5.
During the year Company has issued the 19,50,000 shares of Rs.10/- at a Premium of Rs.5/- per Share through
private placement for augmenting long term resources of the Company and the funds have been utilised for the
same purpose.
6.
In the opinion of the Board, the Current Assets and Loans and Advances have a value on realisation in the ordinary
course of business atleast equal to the amount at which they are stated.
7.
Deferred Taxation :
In accordance with Accounting StandardS-22 'Accounting for taxes on Income' issued by Institute of Chartered
Accountants of India.
Components of Deferred Tax
As at
31.03.2010
Rs.
As at
31.03.2009
Rs.
21,12,51,322
21,10,95,351
60,91,785
49,58,019
21,73,43,107
21,60,53,369
14,29,98,916
17,73,41,432
94,478
14,29,98,916
17,74,35,910
7,43,44,191
3,86,17,460
Deferred Tax Asset on account of:

Carry forward Loss
Employee Benefits
Deferred Tax Liability on account of:

Depreciation
Deferred revenue Expenses
Deferred Tax Asset/(Liability) (Net)
Note: The company has not recognised deferred Tax Asset as a matter of prudence.
8.
38
Interest paid, payable or accrued and due to Micro and small enterprises Rs. NIL (Previous Year Rs. NIL)

SCHEDULE-21 (Contd.)
For the year ended
31-03-2010
Kgs
9.
Rs.
For the year ended

31-03-2009
Kgs
Rs.
LICENCED AND INSTALLED CAPACITIES:

a)
Licenced Capacity :
:
:
:
No.of Spindles 1,50,000

No.of Rotors
1,008
Dyed Yarn
685
Garments (Pcs) 32,00,000
1,50,000
1,008
685
32,00,000
b)
Installed Capacity : No.of Spindles

98,288
: No.of Rotors
168
: Garments(Pcs) 20,00,000
(The installed capacity has been certified
by the management and not verified by
auditors being a technical matter)
98,288
168
15,00,000
c)
PRODUCTION & SALES:

i)
Production of Yarn
Add : Purchase of yarn
Less : Captive Consumption
ii)
d)
Production of Garments (Pcs)
Sales
Yarn
Garments (Pcs)
Waste Cotton & others
1,23,19,831
51,326
1,19,21,718
2,93,473
1,22,68,505
1,16,28,245
16,04,496
10,72,576
1,24,25,061
15,36,475
1,52,54,42,672
23,99,58,032
6,83,05,563
1,18,76,028
10,85,106
1,83,37,06,267
e)
Traded Goods -Sales

Cotton
4,96,668
TOTAL SALES
10. TRADED GOODS - PURCHASES
Cotton
4,96,668
3,81,36,858
1,60,44,68,865
b)
Closing Stocks:
Yarn
Waste Cotton
Garments(Pcs)
3,81,36,858
1,87,18,43,125
1,60,44,68,865
3,69,98,124
3,69,98,124
11. OPENING & CLOSING
STOCKS
a) Opening Stocks:
Yarn
Waste Cotton
Garments(Pcs)
1,36,82,98,365
16,69,38,817
6,92,31,683
6,16,840
44,549
41,685
7,16,70,909
8,18,254
60,61,387
8,64,623
78,374
54,215
10,54,90,930
13,25,942
95,24,335
4,60,284
66,325
1,09,706
6,71,38,686
10,34,860
1,23,90,733
6,16,840
44,549
41,685
7,16,70,909
8,18,254
60,61,387
39

For the year ended
31-03-2010
For the year ended

31-03-2009
Kgs
Rs.
Kgs
Rs.
84,32,842
3,28,727
54,98,215
54,14,70,512
3,96,26,511
36,96,89,198
15,57,49,335
27,59,611
3,35,20,158
1,14,28,15,325
99,52,524
1,43,712
43,29,336
65,15,76,354
1,59,89,715
28,14,45,170
4,45,12,239
55,59,051
3,85,85,215
103,76,67,744
4,96,668
3,69,98,124
13. PERCENTAGE OF MATERIALS AND STORES CONSUMED:

Indigenous
95.94% 1,14,69,99,710
Imported
4.06%
4,85,86,980
100.00% 1,19,55,86,690
92.92%
7.08%
100%
98,62,79,534
7,52,01,932
1,06,14,81,466
12A. RAW MATERIALS CONSUMED:

Cotton
Viscose Staple Fibre
Polyester Staple Fibre
Yarn
Dyeing Materials
Fabric kniting & processing charges
12B. TRADED GOODS CONSUMED:
14. REMUNERATION TO DIRECTORS:

A) CHAIRMAN AND MANAGING DIRECTOR
i)
Salary
ii) Perquisites
HRA
Medical
LTC
Subscription to Clubs
B)
C)
D)
JOINT MANAGING DIRECTOR

i)
Salary
ii) Perquisites
HRA
Medical
LTC
Contribution to Provident Fund
EXECUTIVE DIRECTOR
i)
Salary
ii) Perquisites
HRA
Medical
LTC
WHOLE TIME DIRECTOR
i)
Salary
ii) Perquisites
HRA
Medical
LTC
10,80,000
1080000
4,32,000
90,000
90,000
2,400
16,94,400
432000
90000
90000
2400
1694400
9,60,000
9,60,000
3,84,000
80,000
80,000
3,120
9,360
15,16,480
3,84,000
80,000
80,000
3,120
9,360
15,16,480
8,64,000
8,64,000
3,45,600
72,000
72,000
8,760
9,360
13,71,720
3,45,600
72,000
72,000
8,760
9,360
13,71,720
8,64,000
8,64,000
3,45,600
72,000
72,000
3,120
9,360
13,66,080
5948680
Due to inadequacy of profits the minimum remuneration is paid for the year.
40
3,45,600
72,000
72,000
3,120
9,360
13,66,080
5948680

For the year ended
31-03-2010
For the year ended

31-03-2009
Rs.
Rs.
99,270
55,150
14,339
31,987
94,858
52,393
14,339
29,781
2,00,746
1,91,371
16. Expenditure in Foreign currency during the year on account of:

a) Purchase of : Machinery
4,15,506
b)
: Stores & Spares
29,78,947
c)
: Raw materials
d) Commission on Exports
25,99,019
e) Foreign Travel
14,20,560
4,05,38,888
61,14,411
6,90,87,521
87,23,940
10,82,376
15. Auditor's Remuneration includes

Audit Fees as Auditors
Tax Audit Fees
Tax Representation Fees
For Certification
17. Earnings in Foreign Exchange:

F O B value of exports
33,06,56,034
21,72,48,202
18. Segment information for the year ended 31.03.2010

The Company has identified two reportable segments I.e.Yarn & Garments. The accounting policies
adopted for segment reporting are in line with the accounting policy of the company
SEGMENT WISE REVENUE, RESULTS AND CAPITAL EMPLOYED (Rs. in Lacs)
SL.NO
1.
2.
3.
PARTICULARS
Segment Wise Revenue

(Net Sales+Other Income)
a.
Yarn
b. Garments
c.
Others
TOTAL
Segment Result-Profit/Loss
Before tax and interest from
each segment
a.
Yarn
b. Garments
c.
Others
TOTAL
Less: Interest
loss/ Profit before tax
Capital Employed
(Segment Assets-Segment Liabilities
a.
Yarn
b. Garments
TOTAL
Year
ended
31.03.10
Year
ended
31.03.09
16,197
2,666
14,357
1,837
18,863
16,194
899
295
(14)
1,180
875
305
(526)
112
(414)
974
(1,388)
10,320
1,721
9,546
1,592
12,042
11,139
41

19. Related party disclosure
Related party disclosure as required by AS-18 issued by the Institute of Chartered Accountants of India are given
below:
A:
B:
C:
D:
Associates
1.
Suryavanshi Industries Limited
2.
Suryalaxmi Cotton Mills Limited
Key Managerial Personnel:

1.
Sri B.N. Agarwal
2.
Sri R.K. Agarwal
3.
Sri J.K. Agarwal
4.
Sri D.K. Agarwal
Relatives of Key Managerial Personnel:

1.
Mrs. Narbada Bai Agarwal
2.
Mrs. Yamuna Devi Agarwal
3.
Mrs. Meenal Agarwal
Transactions during the year with related parties

Rs. in Lakhs
Particulars
Current Year
Associates
1.
Remuneration
2.
Amount receivable at the

end of the year
3.
Purchase of Goods
4.
Services
c)
42
Associates
Key
Managerial
Personnel
Relatives
of Key
Managerial
59.49
4.40
4.40
2,352.70
415.03
Weighted aveerage
Number of Equity
Shares used as denominator
for calculating EPS (Nos.)
Basic and Diluted
Earnings per
Share of Rs.10 each (Rs.)
Relatives
of Key
Managerial
59.49
20. EARNING PER SHARE(EPS):

a) Net profit available for
Equity Share Holders (Rs.)
b)
Key
Managerial
Personnel
Previous Year
4.80
4.80
3,04,51,303
(13,93,99,008)
1,32,70,923
1,13,18,673
2.29
(12.32)
21. EMPLOYEE BENEFITS:

The Company has provided for Gratuity based on actuarial valuation on the basis of projected unit credit method.
The following table summarise the components of the net benefit recognized in the profit and loss account and
amounts recognized in the balance sheet for Gratuity.
Profit and Loss account:
Current service cost
Year ended
31.03.10
Year ended
31.03.09
5,25,270
5,29,126
Interest cost
11,66,935
11,70,957
Actuarial Gain / loss

Net benefit expense
12,57,453
29,49,658
9,60,563
26,60,646
1,45,86,698
1,46,36,960
Balance Sheet:
Opening balance of benefit obligations
5,25,270
5,29,126
Interest cost
Current service cost
11,66,935
11,70,957
Actuarial Gain / loss
12,57,453
9,60,563
Benefits paid
(25,16,526)
(27,10,908)
Closing balance of benefit obligations
1,50,19,830
14,58,698
The principal assumptions used in determining the Gratuity

benefits obligation for the Companys plan are as under:
Discount rate
8%
Mortality Table
LIC (1994-96)
Attrition Rate
8%
Further salary raise
10%
22. Previous years figures have been regrouped wherever necessary. Paise have been rounded off to nearest rupee.
SIGNIFICANT ACCOUNTING POLICIES:

1.
ACCOUNTING CONVENTION:
The financial statements are prepared on accrual basis under the historical cost convention and in accordance
with the accounting standars specified in section 211 (3C) of the Companies Act, 1956.
2.
FIXED ASSETS:
Tangible Fixed Assets are valued at cost net of depreciation provided . Depreciation is provided on straight line
method on the basis of continuous process plant at the rates specified in schedule XIV of the Compinies Act, 1956.
The expenditure including interest during the construction period is capitalised by apportioning to the fixed Assets.
3.
INVENTORIES:
Raw Materials and Stores & Spares are valued under weighted average Method. Finished goods are Valued at cost
or net realisable value whichever is lower. Waste is valued at Net relisable value. Work in progress is valued at
cost.
43
4.
INVESTMENTS:
The investments are stated at cost and diminution in the value, which is not temporary in the nature, has been
provided for.
5.
CONTINGENT LIABILITIES:
Contingent Liabilities not provided for are indicated by way of note will be paid or provided on crystalisation of
Liability.
6.
EMPLOYEE BENEFITS:
As per accounting standard 15 "Accounting for Retirement Benefits in the Financial Statement of Employers ", the
disclosure of Employee benefits as defined in the Accounting Standard are given below:
Company's contribution to provident fund determined under the relevant statue are charged to revenue. Gratuity
contribution has been made as per acutuaral valuation under projected unit credit method. Liability on account
of Leave encashment has been provided on the basis of actual liability at the end of the year.
7.
FOREIGN EXCHANGE TRANSACTIONS:

Foreign currency transactions are recorded at the rates prevailing on the date of the transaction. Monetary
assets and liabilities in foreign currency are translated at year end rates. Exchange difference arising on settlement
of transactions and translation of monetary items are recognized as income or expense.
8.
DEFERRED TAX:
Deferred tax is recognised on timing differences, being the difference between taxable income and accounting
income that originate in one period and are capable of reversing in one or more subsequent periods. Deferred
tax assets are recognised only to the extent there is a virtual certainty of its realization.
9.
SALES TAX:
Sales inclusive of Export Benefits receivable and Sales Tax Collected
10. Export Benefits on Exports are accounted on accural basis

11. Insurance Claims are accounted for on admission or on receipt
12. The Company assesses at each balance sheet date whether there is any indication that an asset may be impaired.
If any such indication exists, the Company estimates the recoverable amount of the asset. If such recoverable
amount of the asset or the recoverable amount of the cash generation unit to which the asset belong is less than
its carrying amount, the carrying amount is reduced to its recoverable amount. The reduction is treated as an
impairment loss and is recognized in the profit and loss account. If at the balance sheet date there is an indication
that if at previously assessed impairment loss no longer exists, the recoverable amount is reassessed and the asset
is reflected at the recoverable amount subject to a maximum of depreciated historical cost
(Signatures to Schedules 1 to 21)

K.S. RAO
Partner
Place : Hyderabad
Date : 20.05.2010
44

K.N. NEVATIA
General Manager
B.R.S. REDDY
B.N. AGARWAL
R.K. AGARWAL
Director
Cash Flow Statement for the year ended 31st March, 2010
2009-10
Rs.
A.
2008-09
Rs.
Rs.
Rs.
CASH FLOW ARISING FROM

OPERATING ACTIVITIES
Net Profit/ (loss) before tax and extraordinary items
3,05,01,174
(13,87,74,123)
Adjustments for:
Finance Charges
8,75,03,035
9,74,07,631
Depreciation
7,40,47,059
7,34,66,548
2,73,952
7,82,450
2,77,957
1,89,360
49,275
(6,57,554)
(22,60,554)
Interest Earned
(30,55,044)
(30,04,104)
Profit on Sale of Fixed Assets
(21,59,763)
Loss on sale of Fixed Assets

Preliminary expenses Written Off
Bad debts and Debit Balances Written Off
Excess Provision & Credit Balance Written Back
Dividend Received
(26,750)
Operating profit before working capital changes
15,61,14,295
(15,075) 16,67,04,128
18,66,15,469
2,79,30,005
Adjustments for:
Inventories
(16,56,94,772)
4,55,73,082
Receivables
(3,02,80,594)
5,57,64,600
Loans & Advances
(3,58,09,847)
1,93,57,041
Current Liablities
13,93,30,664
Cash generated from Operations

Direct taxes paid (Including TDS receivable)
Net Cash flow from Operating Activities (A)
B.
(9,24,54,549)
(7,66,01,646)
4,40,93,077
9,41,60,920
7,20,23,082
(4,80,804)
(17,18,858)
9,36,80,116
7,03,04,224
(3,12,96,555)
(6,76,27,475)
29,18,545
3,49,333
CASH FLOW FROM INVESTING ACTIVITIES:

Acquisition of Fixed Assets
(Including Capital Work in progress)
Proceeds from sale of Assets
Proceeds from sale of Investments
Dividend Received
Interest Received
Net cash used in investing Activities (B)
26,750
15,075
9,21,560
1,28,61,635
(2,74,29,700)
(5,44,01,432)
45
Cash Flow statement (Contd.)

2009-10
Rs
C.
Rs
Rs
CASH FLOW FROM FINANCING ACTIVITIES

Proceeds from Borrowings
Repayment of Borrowings
Proceeds from Issue of Equity Share Capital
Interest paid
7,41,51,870
7,96,37,236
(5,71,92,078)
(1,31,81,513)
2,92,50,000
(8,80,14,489)
(9,03,18,571)
Dividends paid
Corporate Dividend Tax paid
(4,18,04,697)
(2,38,62,848)
2,44,45,719
(79,60,056)
Net Cash used in Financing Activities (C)

Net Decrease in cash and cash equivalents (A+B+C)
Cash/Cash Equivalents as at 01st Apr, 2009
3,19,11,740
Cash/Cash Equivalents as at 31st Mar, 2010
5,63,57,459

K.S. RAO
Partner
Place : Hyderabad
Date : 20.05.2010
46
2008-09
Rs
3,98,71,796
(2,44,45,719)
3,19,11,740
79,60,056

K.N. NEVATIA
General Manager
B.R.S. REDDY
B.N. AGARWAL
R.K. AGARWAL
Director
BALANCE SHEET ABSTRACT AND COMPANY'S GENERAL BUSINESS PROFILE

Information pursuant to Part IV of Schedule VI of the Companies Act, 1956
I.
Registration Details
Registration No.
2390
State Code:
01
Balance Sheet Date: 31st March, 2010

II.
(All Rupees in 000's)
Capital raised during the year

Public Issue
Nil
Rights Issue
Bonus Issue
Nil
Private Placement
Nil
19,500
III. Position of Mobilisation and

Deployment of funds
Total Liabilities
13,04,578
Total Assets
13,04,578
Source of Funds
Paidup Capital
1,32,687
Reserves and Surplus
2,77,263
Secured Loans
8,54,399
Unsecured Loans
Net Fixed Assets
7,76,669
Investments
Net Current Assets
4,72,107
Misc.Expenditure
55,641
Total Expenditure
18,55,961
40,230
Application of Funds
IV.
Performance of Company
Turnover
18,86,462
Profit before Tax
30,501
Earnings Per Share in Rs.

V.
161
2.29
Profit after Tax
30,451
Dividend rate
Nil
Generic Names of Three Principal

Products/Services of Company
(as per monetary terms)
Product Description:
Item Code No.(ITC Code)
i)
Cotton Yarn
520300
ii)
P V Yarn
550900
iii)
Garments
610910

K.S. RAO
Partner
Place : Hyderabad
Date : 20.05.2010

K.N. NEVATIA
General Manager
B.R.S. REDDY
B.N. AGARWAL
R.K. AGARWAL
Director
47
NOTES
48
SURYAVANSHI SPINNING MILLS LIMITED

Regd. Office : Surya Towers, 6th Floor,
105, S.P. Road, Secunderabad 500 003
ATTENDANCE SLIP
31st Annual General Meeting, 29th September, 2010 at 10.00 A.M.
PLEASE COMPLETE THIS ATTENDANCE SLIP AND HAND IT OVER AT
THE ENTRANCE OF THE MEETING HALL
DP ID*
Folio Number
Client ID*
No. of Shares held
Name
Address
I hereby record my presence at 31st Annual General Meeting of the Company to be held on Wednesday, the
29th September, 2010 at 10.00 A.M at Gayatri Gardens, Survey No.26, Sikh Village, Near Diamond Point Hotel,
SIGNATURE OF THE MEMBER OF THE PROXY ATTENDING THE MEETING
If Proxy, Please sign here
If Member, Please sign here
*Applicable for investors holding shares in electronic from
SURYAVANSHI SPINNING MILLS LIMITED

Regd. Office : Surya Towers, 6th Floor,
105, S.P. Road, Secunderabad 500 003
PROXY FORM
DP ID*
Folio Number
Client ID*
No. of Shares held
I/We____________________________________________________________________________________________
of ______________________________________________________________________being a member/member of
Suryavanshi Spinning Mills Limited here by appoint ____________________________________________________
of_________________________________________or failing him__________________________________________
of ________________________________________as my /our proxy to attend and vote on my /our behalf at the 31st
Annual General Meeting of the Company to be held on Wednesday, the 29th September, 2010 at 10.00 AM at Gayatri
Gardens, Survey No.26, Sikh Village, Near Diamond Point Hotel, Secunderabad - 500 003.
Signed on this________________________day of ___________2010
Note :
1.
2.
Affix
Rs.1/Revenue
Stamp and
sign across
The Proxy Form duly completed must be deposited at Registered office of the Company, not less than 48 hours before
the time for holding the meeting
A proxy need not be a Member.
49

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BOARD OF DIRECTORS

Chairman and Managing Director

Sri R.Surender Reddy

Sri Rajender Kumar Agarwal

Joint Managing Director

Vice President (Corporate Affairs) &

Commission @ 1% (one percent) of Net

Perquisites: In addition to salary and

To receive, consider and adopt the Profit and Loss

To appoint a Director in place of Sri R.Surender

To appoint M/s. Brahmayya & Co., Chartered

Rent free furnished residential accommodation

Medical Reimbursement: Reimbursement of

Leave Travel Concession for self and family

Fees of clubs, subject to a maximum of two

Personal Accident Insurance: Premium not to

TO CONSIDER, AND IF THOUGHT FIT, TO

Basic Salary: Rs.80,000/- per month

Contribution to Provident Fund, Super

Gratuity payable shall not exceed half a month's

Provision of car for use of company's business

"FURTHER RESOLVED THAT where in any

TO CONSIDER, AND IF THOUGHT FIT, TO

Together with interest thereon at the agreed rates,

Due date for

6. The Companies Act, 1956 provides for the facility of

EXPLANATORY STATEMENT PURSUANT TO SECTION 173 (2) OF THE

State Bank of Hyderabad, Commercial Branch,

Rs. 3.05 Crores as against the loss of Rs. 13.94 Crores

Your Directors are pleased to present their 31st Annual

The aggregate production of Yarn, during the year

Improved international market scenario since end 2009

Provision for Income Tax

In view of the insufficient profits earned by the Company,

- Fringe Benefit Tax

Net Turnover including

Profit/(Loss) after taxation

Continuous Modernization is essential in the Spinning

After a long recessionary phase, the Textile Industry

The exports during the year were Rs.35.01 crores including

The Company, during the year 2009-10, achieved a

International markets have picked-up after the

INCREASE IN THE PAID-UP EQUITY CAPITAL

of public companies in which they hold directorships as

that in the preparation of the annual accounts, the

that the selected accounting policies were applied

that proper and sufficient care has been taken for

that the annual accounts have been prepared on a

Of all the schemes introduced by the Government of

of Employees) Rules, 1975 and hence the prescribed

ANNEXURE TO DIRECTORS' REPORT

Energy conservation measures taken:

Power & Fuel consumption

OTHERS/INTERNAL GENERATORS (Please give details)

Coal (Specify Quality)

Consumption Per Unit of Production

Research and Development R & D

Specific areas in which R&D