ADVANCED MICRONIC DEVICES LTD. - · PDF file1 ADVANCED MICRONIC DEVICES LTD. BOARD OF...

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ADVANCED MICRONIC DEVICES LTD.

BOARD OF DIRECTORS • Mr. Vinod Ramnani Chairman and Managing Director

• Mr. Bhaskar Valiveti Whole-Time Director

• Mrs. Usha Ramnani Director

• Dr. Suleman Adam Merchant Independent Director

• Dr. Anvay Mulay Independent Director

• Mr. Rajkumar Raisinghani Independent Director

• Mr. V. Bala Subramaniam Independent Director

AUDITORS • M/s. Anand Amarnath and Associates

Chartered Accountants

S-2, II Floor, Gem Plaza

No. 66, Infantry Road

Bangalore - 560 001

COMPANY SECRETARY • Mrs. Rose Chintamani

BANKERS • State Bank of India

Bangalore Commercial Branch

Hudson Circle, Bangalore - 560 001

• State Bank of Travancore

Industrial Finance Branch

M.G. Road, Bangalore - 560 001

REGISTERED OFFICE • A-306, II Floor, Block I, KSSIDC Building,

AND Electronic City, Bangalore - 560 100.

INVESTOR'S SERVICE CELL Tel : 080-28521634

Fax : 080-41307586

WEBSITE • www.amdlcorp.com

Annual General Meeting

Day & Date : Tuesday, 29th September 2009

Time : 2.30 P.M.

Venue : St. John's Medical College Hospital AuditoriumOpp. Koramangala BDA Complex

100 feet Road, KoramangalaBangalore - 560 034.

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COMPANY HIGHLIGHTSCOMPANY HIGHLIGHTS

HEALTH CARE DIVISION :

The Division has launched Speciality Critical care and Trauma care Ambulances,

fitted with state of the art equipment. Ambulances being developed on turnkey basis

are broadly of two types :

uBLS (Basic life support) :

A basic life support (BLS) ambulance is one that provides transportation plus the

equipment and staff needed,

These ambulances are best suited for :

Basic services as control of bleeding, splinting fractures, treatment for shock etc.

N o n - e m e r g e n c y p a t i e n t

transport.

Transport to local hospital

for Radiology and

Radiation

appointment.

Hospital discharges

Visit to

physiotherapy and

Dialysis appointment.

uALS (Advanced life support) :

The Advanced life support (ALS) ambulance is a fully loaded ambulance to care for all the

needs. These vehicles are equipped with specialized life sustaining equipments and

include, at a minimum, one two-way voice radio or wireless telephone. These

ambulances can transport ventilator – supported patients on long distances.

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These ambulances are recommended for transporting :

Cardiac care patients

Critically ill Patients

Trauma Patients

These ambulances are fitted with the state-of-the-art pre hospital medical equipment

almost identical to the hospital ICU’s.

The most complex and challenging area of hospital construction is the operating theatre.

The pre-engineered approach solves the problems of coordination, which may be

encountered during the construction or refurbishment of the modern operating theatre

department, whilst simultaneously providing a structure of the highest quality and standards.

Pre-fabricated Operating Theatre is a structural steel shell with a joint less sealed coating,

which may be supplied as an individual unit or as part of a complete operating theatre.

Apart from the specifically Critical Care / Trauma Care Ambulances, we also undertake

Manufacture and supply of Mobile Medical units for Diagnostics, fitted with all the

equipment and services as per the customer needs and specifications.

The Division has also started executing turnkey projects for providing customised

solutions for construction of Modular Operation theatres, surgical pendants,

Intensive Care Units :

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STRATEGIC ELECTRONICS DIVISION :

We have supplied Critical Devices for the

Prestigious Chandrayan Project of ISRO and

manned Lunar Mission projects of IRNSS.

Our Power line Survey Projects for various Power

Corporations across India are running very

successfully. We have completed projects in Kerala,

Haryana, Punjab, Himachal Pradesh and Jammu &

Kashmir. Many projects are under execution and

more orders are also in the pipeline.

CAM Design Services for its foreign client has

stabilized and designs are being handled on

regular basis.

New marketing initiatives using new technology for

Building Management has not only won us awards,

but is also being considered as a viable solution by

Civic bodies and Corporations to improve power

efficiency.

BANK CARD DIVISION :

Our development of the Terminal with latest technology is finding more and more new applications. Out Terminals are being used in

DRetail Chains for loyalty programs

DPoultry products Management

DUtility billing

DTime and Attendance Solutions

DOn-line sales billing etc.

Our Printers developed with the latest technology and new features including blue tooth and biometrics has gained wide acceptance in

DRetail industry

DHealthcare instrumentation

DMicro finance

DSocial Security Schemes

DTicketing for Trains buses etc.

DCar Parking


Award Received from M/s. Echelon Corporationfor "Echelon Asia Pacific

Distributor of the year 2008"

Award Received from M/s. Symmetricom Inc.

for"Project for the year 2008"

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RECOGNITION AND AWARDS :

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DIRECTOR’S REPORT

DEAR SHAREHOLDERS,We are pleased to present the Twenty Eighth Annual Reporton the business and operations of the Company togetherwith the audited financial statements and auditors reportfor the financial year ended 31st March 2009.

Financial Results (Rs. in Lakhs)

Particulars Year Ended Year Ended31-03-2009 31-03-2008

Turnover and ProfitabilityGross Sales 5882.67 5261.10Total Expenditure 5248.04 4505.40Profit before Depreciationand Financial Charges 634.63 755.70

Depreciation 105.61 100.06Financial Charges 183.40 199.49Profit before Tax 345.62 456.15Provision for Taxation (147.69) (172.88)

Profit after Tax 197.93 283.27Prior year adjustments (48.44) (178.82)Add : Profit broughtforward from previous year 413.83 437.65Profit available for Appropriationfrom Operations 563.32 542.10

AppropriationsProposed Dividend 52.81 105.62Provision for Tax on ProposedDividend 7.41 14.81Transfer to General Reserve 3.85 7.83Balance in Profit & Loss Account 499.25 413.84

RESULTS FROM OPERATIONSInspite of a difficult year, engulfed by a slowdown, the totalincome grew by over 11% over the previous year.

TURNOVER AND PROFITABILITYThe gross sales and other income for the financial yearunder review was Rs.5882.67 lakhs. The profit before tax(after depreciation and Financial charges) was Rs.345.62Lakhs and Profit after Tax (before extraordinary items) wasRs.197.93 lakhs.

There has been no material changes and commitmentsaffecting financial position of the Company which haveoccurred between the financial year ending on 31st March2009 and the date of this Report.

APPROPRIATIONSDIVIDENDConsidering the performance of the Company, yourDirectors are pleased to recommend a dividend ofRupee 1 per share for the year 2008-09.

TRANSFER TO GENERAL RESERVEWe propose to transfer Rs.3.85 lakhs to General Reserves.

CAPITAL STRUCTUREDuring the financial year under review, the share capital ofyour company remained unaltered.

CORPORATE GOVERNANCEThe Company is committed to maintain the higheststandards of Corporate Governance and disclosurepractices. Company is ensuring compliance of law andadherence to ethical standards to enhance customer value.A separate section on Corporate Governance along with acertificate from the auditors confirming the level ofcompliance is annexed and forms a part of the Directors’Report.

DIRECTORSMrs. Usha Ramnani and Mr. Rajkumar Raisinghani retireby rotation at the ensuing Annual General Meeting, andbeing eligible, offer themselves for reappointment.

AUDITORSM/s. Anand Amarnath & Associates, CharteredAccountants, Bangalore retire at the conclusion of theforthcoming Annual General Meeting. Your Company hasreceived a letter from them to the effect that theirre-appointment, if made, will be in accordance with theprovisions of Section 224(1B) of the Companies Act, 1956.

In the report by the auditors under Companies (Auditors’Report) Order, 2003 (as amended), the Auditors havereported that the Company has maintained proper recordsof all Accounting transactions.

With regard to observation on gratuity mentioned to PointNo. 4(IV) of Audit Report, we are in the final stages ofsubscribing to gratuity fund & remittance will be made.

Regarding Point No. IX of Annexure to the Auditor's Reporta large amount of refund is due from the department andwill be adjusted against liability.

MANAGEMENT DISCUSSION AND ANALYSISREPORTThe report as required is given as Annexure-I and formspart of the Directors’ Report.

FIXED DEPOSITSDuring the year under review, your Company has notaccepted any deposit under section 58A of the CompaniesAct, 1956 read with Companies (Acceptance of Deposits)Rules, 1975.

DIRECTORS’ RESPONSIBILITY STATEMENTPursuant to the requirement under Section 217(2AA) ofthe Companies Act, 1956, with respect to the DirectorsResponsibility Statement, your Directors state :(i) that in the preparation of the annual accounts, the

applicable accounting standards have been followedand there has been no material departure;

(ii) that the selected Accounting Policies were appliedconsistently and the Directors made judgments andestimates that are reasonable and prudent so as togive a true and fair view of the state of affairs of theCompany as at 31st March 2009 and of the profit of theCompany for the year ended on that date;

(iii) that proper and sufficient care has been taken for themaintenance of adequate accounting records inaccordance with the provisions of the Companies Act,1956 for safeguarding the assets of the Company andfor preventing and detecting fraud and otherirregularities; and

(iv) that the annual accounts have been prepared on agoing concern basis.

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PARTICULARS OF RESEARCH AND DEVELOPMENT,CONSERVATION OF ENERGY, TECHNOLOGYABSORPTION AND FOREIGN EXCHANGE EARNINGSAND OUTGO ETC.Particulars required under Section 217 (1)(e) of theCompanies Act, 1956 read with Rule 2 of the Companies(Disclosure of Particulars in the Report of Board ofDirectors) Rules, 1988 is given in the Annexure-II to theReport.

PARTICULARS OF EMPLOYEESThe details of Employees of the Company who receivedremuneration in excess of the limits prescribed underSection 217 (2A) of the Companies Act, 1956 read with theCompanies (Particulars of Employees) Rules, 1975 is givenin the Annexure-III to the report.

ACKNOWLEDGEMENTSYour Directors would like to place on record their gratitudefor all the guidance and cooperation received from all itsclients, vendors, bankers, financial institutions, businessassociates, advisors, regulatory and governmentauthorities.

Your Directors also take this opportunity to thank all itsinvestors and stakeholders for their continued support andall employees for their valuable contribution and dedicatedservice.

For and on behalf of the Board

Place: Bangalore VINOD RAMNANIDate : 18

th June 2009 Chairman & Managing Director

ANNEXURE - I

MANAGEMENT DISCUSSION AND ANALYSISREPORTOVERVIEWThe current macroeconomic environment poses significantshort and medium term challenges to growth. The globaleconomic crisis affected the Indian economy also, but wasrelatively better off than rest of the world. The volatility inoil prices, exchange rates and inflation became significantfactors affecting corporate and consumer sentiment. In sucha scenario the key to growth is innovation and deepunderstanding of consumer needs. The strategies andtactics that Company’s deploy, act as growth drivers in theseturbulent times.

A. INDUSTRY STRUCTURE AND DEVELOPMENTS,OPPORTUNITIES AND THREATS, SEGMENT-WISE,PRODUCT-WISE PERFORMANCE, OUTLOOK,RISKS AND CONCERNS :The Company is well diversified, both geographicallyand in the products and services it offers. With itsbalanced mix of revenues coming from multiplebusiness segments from different Regions, it is wellpositioned to manage any slowdowns in one businessdivision or a specific geography.

As a response to the slowdown, a slew of initiativesaimed at cost control and efficiency across businessesand across functions, close monitoring of cash flow

on a day to day basis, sharper focus on cashgeneration has been working favourably for theCompany.

The Company’s activities are diversified and eachbusiness segment is in a widely varying industry type.To make the Analysis and Discussion clearlyunderstandable, each Business division has beencovered separately.

i) HEALTHCARE DIVISIONHealthcare, which is a US$ 35 billion industry inIndia, is expected to reach over US$ 75 billion by2012 and US$ 150 billion by 2017.The sector offers immense potential to healthcareplayers as the country witnesses a rise in theincidence of lifestyle-related and other diseases.A growing elderly population and rise in incomelevels are also pushing for better facilities in thecountry.

Access to healthcare is improving in India becauseof the rapid growth of private healthcare providersand an increase in expenditure by the central andstate governments on the provision of healthcare.Privatisation of insurance sector has openedavenues for several private healthcare insurancecompanies. These are the two major factorsdriving the growth of Indian medical device market.The Medical equipment industry is around US$2.17 billion and is growing at 15 per cent per year.It is estimated to reach US$ 4.97 billion by 2012.We are one of the leaders in providing state ofthe art Medical equipments to Critical care,Trauma, Operation theatre areas in the Hospitals.Our 32 years rich experience in the HospitalIndustry gives edge over other players in India.

Our range of Medical equipments fromM/s. Criticare USA, M/s. Mediaid Inc., USA catersto all the Hospital segments like teachinginstitutions, corporate hospitals, Large, Medium& Small hospital segments.

Also, we initiated the new business of offeringSpecialty Ambulances on turnkey basis which isexpected to grow rapidly in India in the comingyears.

We are also entering the niche market of ModularOperation theatres, Surgical Pendants andconstruction of ICU’s on turnkey basis.

RISKS AND CONCERNSThe sub prime crisis, inflationary environmentfuelled by high oil and commodity prices andvolatile exchange rates scenarios are all part ofthe business environment. Considerable effortsare being made to generate business from newgeographies and clients. We are also increasingour focus on all regions.

The Company is facing competition from largeIndian vendors and Global vendors who areincreasing their India presence. Our long standingrelationship with some of the large Hospitals , ourextensive coverage through dealers and excellentafter sales support give us a competitive edge overother players.

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ii) STRATEGIC ELECTRONIC (SED) ANDINFORMATION TECHNOLOGY DIVISIONSThe year has been very absorbing one for theIndian Electronic Technology and IT industry. Evenin an year of economic slowdown, companies thathave demonstrated a balanced strategic outlookand have offered meaningful business to theircustomers have fared reasonably well. Customersare seeking partners with a long track record,financial stability, management continuity and whohave demonstrated long term partnerships.

The target customer segments for our hightechnology products and services are defenceestablishments, aerospace industry, infrastructureindustry, power sector, research labs in public andprivate sector and the educational institutionsspread across the country. In fact, the increasedfocus of Government of India in defence and spaceexplorations has brought forth new opportunitiesfor the products and services of SED.SED offers GPS based products for navigation,control, guidance, timing, ionosheric research etc.These products are essential for many of thedefence applications being developed by thelaboratories coming under Defence Research andDevelopment Organization (DRDO). We areregistered vendors in all these laboratories andinteract closely with these organizations right fromthe conceptual stage of various projects. We havea very strong presence in Indian Space ResearchOrganization (ISRO), by supplying many precisionproducts. We were involved in prestigious projectsof ISRO such as Chandrayan, Indian RegionalNavigational Satellite System, manned lunarmission etc.

In the budget for 2009-10 defence allocationtouched an all time high figure of Rs.141 thousandcrores including Rs.54 thousand crores for capitalpurchase. Similarly Indian Space ResearchOrganization got a budget of Rs.5 thousand croreswhich is an increase of 41% over the previousyear. These positive trends promise a goodbusiness opportunity for the GPS products of SED.

Infrastructure development is being given aspecial boost by the Government. Ports,highways, rail roads, airports all are beingdeveloped at a frantic speed. These constructionactivities create a market for all types of surveyequipments being offered by SED.

Printed Circuit Boards (PCB) are the essential partof any electronic product; be it for consumergoods, defence production of space programs.Recognizing the need for PCB design engineersin various sectors of the industry, manyuniversities have included EDA as part of thesyllabus for BE, B.Tech and Diploma courses.Hence Electronic Design Automation (EDA) toolsused for PCB design have a constantly growingdemand with a large market that includes researchlabs, defence establishments, PSUs, SSUs,MNCs, design houses, educational institutes, etc.

With the Government’s initiative to revive theeconomy, the electronic industry is looking forwardto a stimulus which will in turn offer business

opportunity for this group.

Many projects developed by SED for variousdefence research labs over the past few yearsare now coming for production. This has given avery good growth for the PCB Design Group ofSED. The production orders are given to thevendor who has originally developed the productand this gives us captive business.

The new operation started last year for exportingCAM Design Services for its foreign client hasstabilized and designs are being handled onregular basis.

In the budget for 2009-10, power sector receivedthe largest increase (to the tune of 160%) overthe previous years. In addition Rs.5 thousandcrores have been allotted under the Rajiv GandhiGrameen Vidhyutikarana Yojana (RGCVY) forrural electrification. As per experts, thesemeasures announced by the Government willbenefit all segments of power industries.

One of the major activities of SED is providingTransmission Line Survey using ModernTechniques for the power sector. We have alreadycompleted many thousands of kilo meters ofsurvey and with the new thrust in power sector,this operation is poised for higher growth.

Industries are recognizing the importance ofrunning simulations before building proto types.Similarly civic bodies and corporations are lookingat ways of improving power efficiency. Thoughthese applications are at the initial stage, themarket registers a steady growth. SED offers toolsand solutions for intelligent Building ManagementSystems (BMS), electric machine simulations,optical system simulations etc. It is inevitable thatthis market is bound to grow in coming years andthis group is well positioned to tap this opportunity.

Our Information Technology division providesComprehensive end to end solutions forComputer hardware installation bases mainly inSouth India. We have tremendous scope foroffering managed services at other locations andtaking up areas of enterprise support services..

Apart from sell ing reputed brands of ITinfrastructure products, we provide maintenanceand upgrade services of Computer systems. Ourservices are provided to clients across multipleindustry segments and retail cl ients. Ourprocesses, methodologies, knowledgemanagement systems and tools reduce the overallcost to the Client, and enhance the quality andspeed of delivery.

RISKS AND CONCERNSWe operate in high end technology areas wheretechnological obsolescence is a constant threat.Special focus is being given for getting itspersonnel trained at principal’s facilities and alsoby arranging training in India. Managerial staff isgiven training on management skills and softs kills.These conscious efforts keep its staff highlytrained and competent in their respective areasof activities.

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Since most of the products are of foreign originthe fluctuations in currency rates affect themargins. By a judicious mixing of Dollar tradingand Rupee trading the margins are protected.

Policy decisions of Principals, their countries andour own exim policies affect our business. Forsome of the sensitive products, export license fromthe Government of the originating country isnecessary. This sometimes causes delay inexecuting orders and contracts. Significant stepsare taken to ensure that we do not become toodependent on few suppliers / clients.

iii) BANKCARD DIVISIONWith the Indian Government continuing to give amajor thrust to reforms, the demand for ourTerminal and Printers is finding more and moreapplications and new business opportunities. Theemerging markets such as Govt. Education andRetail for Bio-metric Authentication projects suchas Public Distribution System, Mid day MealsScheme, Elimination of impersonation at theexamination centers, Health Insurance… etc. hascreated tremendous business opportunities for ourrange of products.

PX9600 TERMINALBy investing in appropriate technologies, to caterto these new business opportunities.

Our development team has successfullyintegrated Bio-metric Finger print reader, GSM /GPRS module, Mifare contact less reader (ISO14443A) and Bluetooth module with our Terminal.

We will have more sales opportunities to sell ourTerminals. Further, we have completed the Pilotstudy with the Public Distribution System of Govt.of Karnataka.

Our Terminals are positioned as receipt printer inRetail markets. We have started selling ourTerminal for Poultry Products management.The Terminals are also used in Applications suchas Loyalty card, Util i ty Bil l ing, Time andAttendance, Pre-paid card for campus and Linesales billing.

This product is also being offered to customersas Software as a Service (SaaS). The Applicationwill be hosted on web server and the customersuse as a Service on demand. This first project willbe for Kinder Garden Nursery and Primary schoolswherein the parents will get SMS message aboutthe safe arrival of children in the school and alsoat drop points.

ACCESS PRINTERWe have redesigned the printer with newController GT32A. This Controller allows us towrite new features that are required for emergingmarkets, such as, Retail, Health CareInstrumentation, Micro Finance, Social Securityscheme and Loyalty Programs.

Our development team has added the newfeatures. This has enhanced our opportunity tosell printers to new markets.

RISKS AND CONCERNSOur products continue to remain in a highlycompetit ive market space. Our in housedevelopment team has been able to make costeffective modifications in our products to meetcompetition.

Loss of key personnel in the technology specificareas is the risk faced in our industry. We havebeen able to retain talent, by providing competitivesalary, excellent work culture, career developmentand long term growth prospects.

B. INTERNAL CONTROL SYSTEMS & THEIRADEQUACY :Your Company has adequate internal control systemsand procedures in all the areas of activities. Theactivities are also subject to internal and external audit.The finance department is well staffed with experiencedand qualified personnel who play an important role inimplementing and monitoring internal controlenvironment. The internal control and procedures arecommensurate and adequate with the size and natureof the business of the Company.

C. DISCUSSION ON FINANCIAL PERFORMANCEWITH RESPECT TO OPERATIONALPERFORMANCE :The financial statements have been prepared incompliance with the requirements of the CompaniesAct, 1956.

Amount in Rs.

Particulars As on As on31-03-2009 31-03-2008

SOURCES OF FUNDS Shareholders funds Share Capital 52,811,000 52,811,000Reserve & Surplus 135,400,094 126,474,035 188,211,094 179,285,035Loan Funds Secured Loans 122,317,288 124,366,692

Deferred Tax Liability (NET) 3,345,275 5,056,275

313,873,657 308,708,002

APPLICATION OF FUNDS Fixed Assets Cost 138,604,161 123,685,570Less : Accumulateddepreciation 41,910,634 31,335,237

Net Book Value 96,693,527 92,350,333

Investments 2,850,225 2,850,225Current Assets,Loans and Advances Inventories 291,088,202 267,599,074Sundry Debtors 363,476,505 315,849,850Cash & Bank Balances 46,891,950 52,288,859Loans & Advances 32,702,250 49,765,476

734,158,907 685,503,259Less : Current Liabilitiesand provisions 519,829,002 471,995,815

Net Current Assets 214,329,905 213,507,444

313,873,657 308,708,002

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SHARE CAPITAL (Issued, subscribed and paid up)

The Company has only one class of shares viz. equityshares of par value Rs.10/- each.

During the financial year under review, the Share Capitalof your Company remained unaltered.

RESERVES AND SURPLUS

The total reserves and surplus has increased fromRs.126,474,035 on March’08 to Rs.135,400,094 onMarch’09. The increase has been on account of profitsmade during the year of Rs.14,947,834 and adjusted fordividend payout of Rs.6,021,775 inclusive of dividenddistribution tax.

LOAN FUNDS

The secured loans have decreased from Rs.124,366,692in March’08 to Rs.122,317,288 in March’09 due torepayment of Bank borrowings.

FIXED ASSETS

During the year, the Company has capitalized assets tothe extent of Rs.14,848,889 and disposed assets to thetune of Rs.609,213. The Company has started depreciatingthe capitalized assets over their estimated useful livesduring the year, thereby resulting in an increase inaccumulated depreciation.

CURRENT ASSETS, LOANS AND ADVANCES

Inventories have increased from Rs.267,599,074 inMarch’08 to Rs.291,088,202 in March’09 including projectwork in progress.

Sundry debtors stood at Rs.363,476,505 as at March’09compared to Rs.315,849,850 as at 31st March 2008. Thesedebtors are considered good and realizable.

Cash and bank balances have reduced by from 52,288,859as at 31st March, 2008 to 46,891,950 as at 31st March 2009.

Loans and advances have reduced from Rs.49,765,476as at 31st March 2008 to Rs.32,702,250 as at 31st March2009.

CURRENT LIABILITIES AND PROVISIONS

Current Liabilities and Provisions have increased by 10.13%from Rs.471,995,815 as at 31st March 2008 toRs.519,829,002 as at 31st March 2009.

Creditors increased from Rs.136,010,999 as at 31st March2008 to Rs.200,641,838 as at 31st March 2009.

The Company has proposed a dividend of Rs.5,281,100(Rupee 1 per share) for the year ended 31st March 2009 asagainst Rs.10,562,200 (Rupee 2 per share) in the previous year.

REVENUESProfit And Loss Account for the year ended31st March 2009 Amount. in Rs.

Particulars 31-03-2009 31-03-2008

INCOMESales 585,812,493 524,209,998Other income 2,454,346 1,899,732

588,266,839 526,109,730

EXPENDITURECost of Goods Sold 398,307,482 333,449,968Administrative & SellingExpenses 126,496,417 117,090,358Interest & Financial Charges 18,340,297 19,948,565

543,144,196 470,488,891

PROFIT BEFOREDEPRECIATION & TAXES 45,122,643 55,620,839Depreciation 10,560,876 10,006,153

PROFIT BEFORE TAXES 34,561,767 45,614,686Provision for Taxes Current Tax 15,000,000 16,028,000 Deferred Tax (1,711,000) (35,000) Fringe Benefit Tax 1,480,476 1,294,579 Prior year Adjustments 4,844,457 17,882,055

NET PROFIT FOR THEYEAR 14,947,834 10,445,052Balance brought forwardfrom the previous year 41,383,195 43,765,071

PROFIT AVAILABLEFOR APPROPRIATION 56,331,029 54,210,123Proposed dividend onequity shares 5,281,100 10,562,200Tax on proposed dividend 740,675 1,481,349Transfer to General Reserve 384,531 783,379BALANCE AT END OF

THE YEAR 49,924,723 41,383,195

The Company’s total income has three components.◆ Sales and Service of Healthcare products◆ Sales and Service of Information Technology products◆ Other Income

The following table sets out the contribution of each of thesesegments for the years ended 31st March 2009 and31st March 2008.

Amount. in Rs.

Segment wise Revenue 31-03-2009 31-03-2008

Health Care 344,955,000 303,401,000Information Technology 240,857,493 220,808,998Others 2,454,346 1,899,732

TOTAL 588,266,839 526,109,730

Segment wise contribution 31-03-2009 31-03-2008

Health Care 29,659,000 36,598,000Information Technology 20,788,654 27,065,268Others 2,454,346 1,899,732

TOTAL 52,902,000 65,563,000

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OTHER INCOMEOther income consists mainly of interest received on fixeddeposits.

COST OF GOODS SOLDThe cost of goods sold has increased from Rs.333,449,968in the previous year to Rs.398,307,482 in the year ended31st March 2009 due to increase in sales. As a percentageof sales, material costs have increased 19.45% during2008-09.

OPERATING AND SELLING EXPENSESOperating and selling expenses have increased fromRs.117,090,358 in fiscal 2008 to Rs.126,496,417 in fiscal2009.

INTEREST AND FINANCIAL CHARGESInterest and financial charges has reduced fromRs.19,948,565 in fiscal 2008 to 18,340,297 on account ofrepayment of part of the Secured loans from the Bank.However, the reduction is not in proportion to the repaymentmade, due to the increase in the rate of interest inborrowings.

DEPRECIATIONDepreciation has increased from Rs.10,006,153 in fiscal2008 to Rs.10,560,876 in fiscal year 2009.

PROVISION FOR TAXESProvision for Current, deferred and fringe benefit tax in theyear ended 31st March 2009 was Rs.14,769,476.

ANNEXURE - IIIInformation as per Section 217 (2A) of the Companies Act, 1956, read with Companies (Particulars of Employees)Rules, 1975, and forming part of the Directors Report for the year ended 31st March 2009.

I. Employed throughout the year.

Employee Designation Qualifi- Age Joining Experience Gross PreviousName cation Date (Years) Remuneration Employment

Rs.

Bhaskar Whole-time B.E. 53 24-08-2001 31 28,92,000 Altron IndustriesValiveti Director Pvt. Ltd., Director

II. Employed for part of the year - NilIII. There were no Employees covered under the provisions of the Section 217(2A)(a)(III) of the Companies Act, 1956.IV. Mr. Bhaskar Valiveti is not related to any other Director and his nature of duty is Managerial.

NET PROFITNet profit from operations for the fiscal 2009 has increasedby Rs.4,502,782.

d) MATERIAL DEVELOPMENTS IN HUMANRESOURCES / INDUSTRIAL RELATIONSFRONT, INCLUDING NUMBER OF PEOPLEEMPLOYED.The Company considers its employees as valuableassets, and has adopted various HR measuresincluding proper appraisal of employees, placements,recognition, career growth, improvement of managerialand inter-personal skills through various trainingprograms and so on. The Company had 219 employeesas at 31st March 2009.

CAUTIONARY STATEMENTThe statements made in this report and those appearingelsewhere, may be “forward looking statements” that setforth anticipated results based on management plans andassumptions. These statements are likely to address theCompany’s growth strategy and financial results and aresubject to risks, uncertainties and inaccurate assumptions.Should known or unknown risks or uncertainties materialize,or should underlying assumptions prove inaccurate, actualresults could vary materially from past results and thoseanticipated, estimated or projected.

ANNEXURE - IICONSERVATION OF ENERGY, RESEARCH AND DEVELOPMENT, TECHNOLOGY ABSORPTION,FOREIGN EXCHANGE EARNING AND OUTGO.In pursuance of the provisions of Section 217(1)(e) of the Companies Act, 1956, read with Rule 2 of the Companies(Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988, the particulars relating to conservation ofenergy, technology absorption and foreign exchange earning and outgo are furnished below :

1. Conservation of Energy : The operations of your Company are not energy intensive.

Adequate measures have, however, been taken to reduce energy consumption by using Energy efficient computerterminals. Air conditioners are used only when required, thereby enhancing energy efficiency.

2. Research and Development : No R&D projects was under taken during the year.

3. Technology Absorption : Not applicable.

4. Foreign Exchange Earning and outgo : The Company earned Rs.158.95 lakhs in Foreign Exchange. The ForeignExchange outgo including for capital goods was Rs.2,166.30 lakhs.

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CORPORATE GOVERNANCE

A report containing the details of Corporate Governance systems and procedures for the period from 1st April 2008 to31st March 2009 in accordance with Clause 49 of the Listing Agreement with the Stock Exchange is as follows :

1. PHILOSOPHY ON THE CODE OF CORPORATE GOVERNANCE :Advanced Micronic Devices Limited continues its commitment to the principles of Corporate Governance by upholdingfair and ethical Business and Corporate practices, which among others ensures transparency, delegation and responsibility.Corporate Governance system is continuously reviewed, strengthened and upgraded to achieve efficiency in all theactivities of the Company. With this the Company aims to sustain and increase the confidence of the stakeholders.

2. BOARD OF DIRECTORS :

(i) Composition and category :

The Board of Directors comprised Seven Directors as on 31st March 2009, with Two Executive Directors and Five Non-Executive Directors, of which four are Independent Directors.

Mr. Vinod Ramnani is the Chairman and Managing Director and Mr. Bhaskar Valiveti is the Whole-time Director of theCompany.

The Directors of the Company possess the highest personal and professional ethics, integrity and values and arecommitted to enhance the long term interest of the stakeholders. They provide efficient governance over the affairs ofthe Company in all its aspects and exercise appropriate business judgment on the affairs of the Company.

During the year Seven Board Meetings were held on the following dates.

SL Date of Board Meeting SL Date of Board Meeting SL Date of Board Meeting

01 24-04-2008 04 30-09-2008 07 20-03-2009

02 27-05-2008 05 21-10-2008

03 31-07-2008 06 27-01-2009

(ii), (iii) & (iv)

Meetings & Attendance record of Directors and other Directorships / Committee Memberships

The details of the Directors with regard to Directorships in other Companies, Committee Memberships / Chairmanship ason 31st March 2009 and their attendance at the Board / Last Annual General Meeting is as given below :

Name & Category Date of No. of Board No. of Memberships Chairman WhetherAppointment Meetings Memberships of Board of Board last

Attended in the Board Committees Committees AGMof other in all in all AttendedCompanies Companies* Companies**

Mr. Vinod RamnaniChairman & Managing Director 24-08-2001 07 03 Nil Nil Yes

Mr. Bhaskar ValivetiExecutive Director 24-08-2001 07 Nil Nil Nil Yes

Mrs. Usha RamnaniNon Executive Director 24-08-2001 06 03 02 Nil Yes

Dr. Suleman Adam MerchantNon Executive Independent Director 31-12-2005 02 01 02 02 No

Dr. Anvay MulayNon Executive Independent Director 31-12-2005 03 01 Nil Nil No

Mr. Rajkumar RaisinghaniNon Executive Independent Director 31-12-2005 06 02 04 Nil Yes

Mr. V. Bala SubramaniamNon Executive Independent Director 31-12-2005 04 01 Nil 02 Yes

* Membership across all Companies excluding Private Companies, Foreign Companies and Companies under Section 25 of theCompanies Act, 1956.

** Chairmanship / Membership of Audit Committee and Share Holders & Investors Grievance Committee.

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Relationship between DirectorsMr. Vinod Ramnani, Chairman and Managing Director and Mrs. Usha Ramnani, Director being husband and wife are relatedto each other.

(v) CODE OF CONDUCT :The Board of Directors of your Company have laid down a code of conduct (‘the code’) applicable to all Board Membersand Senior Management personnel of your Company. A Declaration from the CEO of your Company to the effect that allBoard Members and Senior Management personnel of your Company have affirmed Compliance with the code forms aPart of this Report.

3. AUDIT COMMITTEE :(i) & (ii) The Company has a qualified and independent Audit Committee. The Present Committee consists of 3 membersas given below :

Sl No Name of the Member Category Position

01 Mr. V. Bala Subramaniam Non Executive Independent Director Chairman

02 Dr. Suleman Adam Merchant Non Executive Independent Director Member

03 Mr. Rajkumar Raisinghani Non Executive Independent Director Member

(iii) During the year five Audit Committee meetings were held. The requirements on periodicity and time gap between twomeetings were in accordance with the requirements of Clause 49 of the Listing agreement.

The details of the Committee and attendance at the Meetings are given below :

Sl No Name of the Member Position No. of Meetings Attended

01 Mr. V. Bala Subramaniam Chairman 05

02 Dr. Suleman Adam Merchant Member 01

03 Mr. Rajkumar Raisinghani Member 05

The Audit Committee has the following powers :1. To investigate any activity within its terms of reference.

2. To seek information from any employee.3. To obtain outside legal or other professional advice.

4. To secure attendance of outsiders with relevant expertise, if it considers necessary.

The role of the Audit Committee includes the following :1. Oversight of the Company’s financial reporting process and the disclosure of its financial information to ensure that the

Financial Statements are fairly stated.

2. Recommending to the Board, the appointment, re-appointment and if required the replacement or removal of StatutoryAuditor and fixation of audit fee.

3. Approval of payment to Statutory Auditors for any other services rendered by the statutory auditors.

4. Reviewing with Management the annual financial statement before submission to the Board for approval, with particularreference to :a) Matters required to be included in the Directors’ Responsibility Statement to be included in the Board’s Report in

terms of Clause (2AA) of Section 217 of the Companies Act, 1956.b) Changes, if any, in accounting policies and practices and reasons for the same.c) Major accounting entries involving estimates based on the exercise of judgment by Management.d) Significant adjustments made in the Financial Statements arising out of audit findings.e) Compliance with listing and other legal requirements relating to Financial Statements.f) Disclosure of any related party transactions.g) Qualifications in the draft audit report.

5. Reviewing with Management the quarterly financial statements before submission to the Board for approval.

6. Reviewing, with the Management, the statements of uses I application of funds raised through an Issue (Public Issue,Rights Issue, Preferential Issue etc.), the statement of funds utilized for purposes other than those stated in the offerdocuments I prospectus I notice and the report submitted by the monitoring agency, monitoring the utilization ofproceeds of a public or right issue and making appropriate recommendation to the Board to take up steps in thismatter.

7. Reviewing with the Management performance of Statutory and Internal Auditors and adequacy of internal control systems.

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8. Reviewing the adequacy of internal audit function, if any, including the structure of the internal audit department,staffing, and the seniority of the official heading the department, reporting structure, coverage and frequency of internalauditors.

9. Discussion with internal auditor any significant findings and follow up thereon.10. Reviewing the findings of any internal investigations by the internal auditors into matters where there is suspected

fraud or irregularity or failure of internal control systems of a material nature and reporting the matter to the Board.11. Discussion with Statutory Auditors before the audit commences, about the nature and scope of audit as well as

post -audit discussion to ascertain any area of concern.12. To look into the reasons for substantial defaults in the payment to the depositors, debenture holders, Shareholders (in

case of non payment of declared dividends) and creditors.13. To review the functioning of the whistle blower mechanism, in case the same is existing.14. Carrying out any other function as is mentioned in the terms of reference of the Audit committee.

4. REMUNERATION COMMITTEE AND REMUNERATION TO DIRECTORS :(i), (ii) & (iii)The Board constituted a Remuneration Committee which presently comprises of three Non Executive IndependentDirectors.

Sl No Name of the Member Category Position

01 Mr. V. Bala Subramaniam Non Executive Independent Director Chairman02 Dr. Suleman Adam Merchant Non Executive Independent Director Member03 Mr. Rajkumar Raisinghani Non Executive Independent Director Member

The Committee reviews and decides the overall remuneration of the key employees of the Company and of its Directors.

The Committee has been empowered to review / recommend appointment and remuneration of the Executive & NonExecutive Directors. The Committee met once during the financial year at which the Chairman and a member werepresent.

(iv) REMUNERATION POLICYThe Remuneration paid to Mr. Bhaskar Valiveti is as per the Service Contract entered into with him, the terms andconditions of which are approved by the Remuneration Committee, Board and the Shareholders.

The main trust of the Remuneration Policy of the Company is to attract and retain high talented employees best suitedfor the positions and suitably reward the employees for their success and performance. The remuneration paid is asper prevailing industry standards.

(v) (a) The remuneration paid to the Directors during the year are given below :

Sl No Name of the Director Salary Rs. Perquisites* Rs. Total Rs.

01. Mr. Vinod Ramnani Nil Nil Nil02. Mr. Bhaskar Valiveti 21,00,000 7,92,000 28,92,00003. Mrs. Usha Ramnani Nil Nil Nil04. Dr. Suleman Adam Merchant Nil Nil Nil05. Dr. Anvay Mulay Nil Nil Nil06. Mr. Rajkumar Raisinghani Nil Nil Nil07. Mr. V. Bala Subramaniam Nil Nil Nil

Note : * Perquisites include House Rent allowance and contribution to Provident Fund.

(b) during the year no remuneration was paid to the Non-Executive Directors of the Company and no Sitting fees forattending Board / Committee Meetings were paid to the Directors.

(c) Apart from the above fixed components, no performance linked incentives were paid to Mr. Bhaskar Valiveti.

(d) The Notice Period for terminations is Three months from either parties and there is no Severance Fee relating toappointment of Mr. Bhaskar Valiveti as Whole-Time Director.

5. SHAREHOLDERS / INVESTORS GRIEVANCE COMMITTEE :

(i) The Shareholders / Investors Grievance Committee presently consists of 3 members, of which two are Non-ExecutiveIndependent Directors as detailed below :

No Name of the Member Category Present Position

01 Dr. Suleman Adam Merchant Non Executive Independent Director Chairman02 Mrs. Usha Ramnani Non Executive Director Member03 Mr. Rajkumar Raisinghani Non Executive Independent Director Member

The Committee is constituted to specifically redress Shareholders and Investors complaints like non receipt of AnnualReports, declared dividends etc. and also to approve share transfers, transmissions, transpositions, splitting andconsolidation of Shares / Share Certificates etc.

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Periodically audits are also carried out at the office of the Share Transfer Agents by independent practising CompanySecretary and requisite Certificates / Reports are obtained and forwarded to the Stock Exchange.

The Committee met 14 times during the financial year 2008-09

The attendances of the Members are given below :

Sl No Name of the Members Attendance

01 Dr. Suleman Adam Merchant 0102 Mrs. Usha Ramnani 1303 Mr. Rajkumar Raisinghani 14

(ii) Mrs. Rose Chintamani, Company Secretary is the Compliance Officer.

(iii), (iv) & (v) The total number of complaints received and replied to the satisfaction of shareholders during the year underreview, were 21. There were no outstanding complaints as on 31st March 2009. No requests for transfers and fordematerialization were pending for approval as on 31st March 2009.

6. GENERAL BODY MEETINGS :(i) (ii) Location and time, where last three AGMs were held and the special resolutions passed thereat.

Financial Year 2005-06 2006-07 2007-08

Date 28th September 2006 25th September 2007Time 4.00 PM 4.00 PMVenue The Grand Ashok The Grand Ashok

Kumar Krupa Kumar KrupaHigh Grounds High GroundsBangalore-560 001 Bangalore-560 001

Special Nil 1. Increase of Authorized ShareResolutions Capital from Rs.7.50 crores topassed 10.00 crores and amendment of

the Memorandum of Associationaccordingly.

2. Amendment to the Articles ofAssociation to increase theAuthorized Capital as above.

3. Re appointment of Mr. BhaskarValiveti, as Whole-time Directorof Company for a period of3 years from 1st January 2007.

(iii) & (iv) During the year 2008-09 a Special Resolution was passed through Postal Ballot Notice dated 31st July 2008pursuant to Section 192A of the Companies Act, 1956 for amending the Object clause of the Memorandum of Associationof the Company. The Postal Ballot was conducted by Mr. Uday Shankar R.M. of Messrs. Uday Shankar Associates,Advocates, Fortune Chambers, 1st Floor, No.8, Lalbagh Road, Richmond Circle, Bangalore-560 027, who was appointedas The Scrutinizer by the Board of Directors.The details of the voting pattern are as follows :

Ballot Votes %

In Favor 115 3170298 99.96Not in favor 20 398 0.01*Invalid 08 1635 0.03

Total 143 3172331 100.00* The reasons for invalid entry : 1) Vote not cast. 2) Vote not Clear.

(v) & (vi) Resolution through Postal Ballot will be conducted as and when required by following the prescribed procedure.

7. DISCLOSURES :(i) Basis of Related party Transaction

Your Company places all the details with reference to related party transactions before the Audit Committee periodically.

No transaction of a material nature has been entered into by the Company with Directors or Management and theirrelatives etc. that may have a potential conflict with the interest of the Company. All related details are provided in theNotes forming part of the Accounts in accordance with the Accounting Standard 18, issued by the Institute of CharteredAccountants of India.

30th September 20083.00 PMNIMHANS Convention CentreHosur RoadBangalore-560 027

Nil

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(ii) There has been no instance of non-compliance by the Company on any matter related to capital markets. Hence thequestion of penalties or strictures being imposed by SEBI or Stock Exchanges does not arise.

(iii) Whistle Blower policy is at present not adopted by the Company

(iv) All the Mandatory requirements of Corporate Governance clause have been complied with by the Company and compliancewith non mandatory requirements have been detailed under Sl. No. 10 of this Report.

(v) Disclosure of Accounting treatments

Your Company has followed all relevant Accounting Standards while preparing the Financial Statements, except relatingto gratuity, which is explained in the Directors Report under the heading Auditors.

(vi) Risk Management

The Company over the years has evolved and analyzed the risks associated with its business. Appropriate systems areput in place to reduce and mitigate the risks. The Board and the Audit Committee of the Company also plays a pivotal rolein risk management.

(vii) Proceeds from public issues, Right Issues, Preferential issues etc.

During the year under review, your Company has not raised any funds by way of public issues etc.,

(viii) Pecuniary relationship or transactions of the Non-executive Directors vis-à-vis the Company.

During the year no significant material transaction has been made with the non-executive directors vis-à-vis the Company

(ix) Details of Directors shareholding as on 31st March 2009 are as follows :

Sl No Name of the Director No. of Shares

01 Mr. Vinod Ramnani Nil

02 Mr. Bhaskar Valiveti 2100

03 Mrs. Usha Ramnani 1775

04 Dr. Suleman Adam Merchant Nil

05 Mr. V. Bala Subramaniam Nil

06 Mr. Rajkumar Raisinghani Nil

07 Dr. Anvay Mulay 700

(x) Management

No material transaction has been entered into by your Company with the promoters, directors or the Management, theirsubsidiaries or relatives etc. that may have a potential conflict with the interest of your Company.

(xi) CEO/CFO Certification

A certificate from the CEO / CFO on the Financial Statements of the Company was placed before the Board.

8 A. MEANS OF COMMUNICATION :

(i) & (ii) The annual, half yearly and quarterly results are regularly submitted to the Stock Exchange in accordancewith the Listing Agreement and published in leading national newspapers like Business standard and other localnews papers.

(iii) The financial results of the Company are displayed at the SEBI Website “www.sebiedifar.nic.in”

(iv), (v) There were no official news releases or presentations made to the institutional investors and analysts duringthe year.

B. MANAGEMENT DISCUSSIONS AND ANALYSIS :

The Management discussions and Analysis report forms part of the annual report and is captioned “ManagementDiscussion and Analysis Report” as one of the Annexure in the Directors Report.

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9. GENERAL SHAREHOLDERS INFORMATION :

(i) Annual General Meeting

Date and Time : 29th September 2009 at 2.30 P.M.

Venue : St. John's Medical College Hospital Auditorium,Opp. Koramangala BDA Complex,100 feet Road, Koramangala, Bangalore-560 034.

(ii) Financial Calendar

Reporting Period

Quarter 30th June 2009 on or before 31st July 2009Quarter 30th September 2009 on or before 31st October 2009Quarter 31st December 2009 on or before 31st January 2010Quarter 31st March 2010 on or before 30th June 2010AGM for the approval of theAudited accounts for the yearEnded 31st March 2010 on or before 30th September 2010

Financial year 1st April to 31st March.

(iii) Details of Book Closure : 23rd September 2009 to 29th September 2009(Both days inclusive)

(iv) Dividend Payment Date : On or after 29th September 2009

(v) Listing of Equity Shares on Stock

Exchanges : Bombay Stock Exchange LimitedPhiroze Jeejeebhoy TowersDalal Street, FortMUMBAI - 400 001.

Listing Fee : Paid

(vi) a. Trading SymbolBombay Stock Exchange Ltd. : Scrip ID ADVNCMIC

Scrip Code 517552

b. Demat ISIN Numbers inNSDL & CDSL for Equity Shares : INE E 903C01013

(vii) Stock Market Data: High and Low Quotation at Bombay Stock Exchange Limited.

Month High Low No. of Shares Traded

Apr-08 69.45 49.50 48243

May-08 73.85 55.15 69525

Jun-08 64.95 41.60 22265

Jul-08 62.25 42.00 41970

Aug-08 75.00 50.00 269599

Sep-08 61.25 43.80 27318

Oct-08 46.10 30.75 22450

Nov-08 36.20 27.85 78393

Dec-08 35.60 29.00 20849

Jan-09 38.55 32.00 13715

Feb-09 34.65 28.75 26117

Mar-09 34.25 29.00 65387

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(viii) The Performance of the Company’s Stock Exchange Quotations in comparison to BSE Sensex (average of monthlyhigh and low of price/Sensex)

Rs. / Points

(ix) Registrar & Transfer Agents(Share Transfer and communication regarding Karvy Computershare Pvt. Ltd.Share certificate, dividends & change of Address) No. 17 to 24, Near Image Hospital

Vittal Rao NagarMadhapur, HYDERABAD - 500 081.Phone No: 040-23420815 to 828Fax No: 040 - 23420814E-Mail: [email protected]

(x) Share Transfer SystemPresently the Share transfers which are received in physical form are processed and the Share Certificatesreturned within a period of 15 to 16 days from the date of receipt, subject to the documents being valid andcomplete in all respects. The share transfer/transmissions are approved by the Investors / Shareholders Grievancescommittee.

(xi) Distribution of Shareholding as on 31st March 2009

Sl No Category (Shares) Number % Amount Rs. %From To

01 01 500 5486 90.06 7502210 14.2002 501 1000 363 5.96 3021550 5.7203 1001 2000 122 2.00 1830130 3.4704 2001 3000 48 0.79 1253750 2.3705 3001 4000 18 0.30 660720 1.2506 4001 5000 13 0.21 632380 1.2007 5001 10000 23 0.38 1599700 3.0308 10001 & above 18 0.30 36310560 68.76

TOTAL 6091 100.00 52811000 100.00

Categories of Shareholders as on 31st March 2009

Sl No Description No. of share holders Total shares % of Equity

01 Clearing Members 05 13650 0.2602 Foreign Institutional Investors 03 2600 0.0503 H.U.F. 114 47637 0.9004 Indian Financial Institutions 01 800 0.0205 Indian Mutual Funds 04 1100 0.0206 Bodies Corporates 134 200589 3.8007 Non Resident Indians 61 95966 1.8208 Promoters 01 3153165 59.7109 Resident Individuals 5768 1765593 33.42

TOTAL 6091 5281100 100.00

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(xii) Dematerialization of Shares59.71% of the Paid Up Capital is held by Opto Circuits (India) Limited, the holding Company and public holds thebalance.

48,80,293 shares representing 92.41% of the paid-up capital have been dematerialized as on 31st March 2009.

(xiii) There were no outstanding GDRs/ADRs/Warrants or any convertible instruments as on 31st March 2009.

(xiv) The Company has its plant located at Plot No. 16, I-A Cross, Electronic City, Hosur Road, Bangalore-560 100.

(xv) ADDRESS FOR CORRESPONDENCE :(i) Investor Correspondence for Shares held in physical form

(Share Transfer and communicationRegarding share certificate, dividends Karvy Computershare Pvt Ltd.And change of address and any query No. 17 to 24, Near Image HospitalRelating to the shares of the Company Vittal Rao Nagar

Madhapur, HYDERABAD - 500 081.Phone No: 040 - 23420815 to 828Fax No: 040 - 23420814E-Mail: [email protected]

(ii) For Shares held in Demat form To the Depository Participant.

(iii) The Company has designated [email protected] as the email for the purpose of registering complaintsby investors.

(xvi) DISCLOSURES REGARDING SUSPENSE ACCOUNT PURSUANT TO SEBI CIRCULAR NO.SEBI/CFD/DIL/LA1/2009/24/04 DATED 24th APRIL 2009 :As per the above mentioned Circular, Clause 5A stands for shares issued pursuant to the public issues or any otherissue which remain unclaimed and / or lying in the Escrow account and any unclaimed benefits like Dividend, BonusShares etc. which are to be credited to the Demat Suspense Account. This being the first year after the Circularcoming into force from April 2009, your Company is taking steps to streamline the requirements.

10. NON-MANDATORY REQUIREMENTS :1. The Company has no non-executive Chairman on its Board.

2. The Remuneration Committee is constituted by the Board, the details of which are provided under the heading“Remuneration Committee and Remuneration to Directors”.

3. Appropriate actions to resolve the issues relating to gratuity and payment of Income Tax liabilities are being initiatedand the Company will shortly move towards a regime of unqualified Financial Statement.

4. The Company has not adopted the other non-mandatory requirements as specified in Annexure I D of Clause 49 ofthe Listing Agreement.

By order of the Boardfor ADVANCED MICRONIC DEVICES LTD.

Place : Bangalore Vinod RamnaniDate : 18th June 2009 Chairman and Managing Director

CERTIFICATE UNDER CORPORATE GOVERNANCE REPORT

Certificate related to code of conduct for Director’s / Senior Management

This is to Certify that as per revised Clause 49 of the Listing Agreement the code of conduct has been laid down for all theBoard Members and Senior Management of the Company. The Board Members and Senior Management personnel haveaffirmed compliance with Company’s code of conduct for the year 2008-09.

Place : Bangalore Bhaskar ValivetiDate : 18th June 2009 CEO / Whole-Time Director

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AUDITORS’ CERTIFICATE ON COMPLIANCE WITH THE CONDITIONS OFCORPORATE GOVERNANCE UNDER CLAUSE 49 OF THE LISTING AGREEMENT

To,

The Members

Advance Micronic Devices Limited,

We have examined the compliance of the conditions of Corporate Governance by Advanced Micronic Devices

Limited for the year ended 31st March 2009, as stipulated in Clause 49 of the Listing Agreement of the Company

with Stock Exchanges in India.

The compliance of the conditions of Corporate Governance is the responsibility of the Management. Our

Examination was limited to procedures and implementation thereof, adopted by the Company for ensuring the

compliance of the conditions of Corporate Governance. It is neither an audit nor an expression of opinion on the

financial statements of the Company.

In our opinion and to the best of information and according to the explanations given to us, the Company has

complied with the conditions of Corporate Governance as stipulated under Clause 49 of the listing Agreement.

For Anand Amarnath & AssociatesChartered Accountants

Place : Bangalore B.K. Amarnath

Date : 18th June 2009 Partner

M. No. : 026536

21

AUDITOR'S REPORT

To,

The Members of

ADVANCED MICRONIC DEVICES LIMITED,

Bangalore.

1. We have audited the attached Balance Sheet of

ADVANCED MICRONIC DEVICES LIMITED as at

31st March 2009 and the Profit and Loss Account for

the year ended on that date annexed thereto. These

financial statements are the responsibility of the

Company’s management. Our responsibility is to

express an opinion on these financial statements based

on our audit.

2. We conducted our audit in accordance with 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.

3. As required by the Companies’ (Auditor’s Report)

Order, 2003 in terms of Sub-Section (4A) of

Section 227 of the Companies Act, 1956, and

according to the information and explanation given to

us during the course of the audit and on the basis of

such checks as we consider appropriate, we enclose

in the Annexure a statement on the matters specified

in Paragraphs 4 and 5 of the said Order.

4. Further to our comments in the Annexure referred to

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.

(iv) In our opinion, the Balance Sheet, Profit and Loss

Account and Cash Flow statement dealt with in this

report subject to Notes to Account No. 12, regarding

gratuity provision : 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 representation received from

the directors, as on 31st March 2009 and taken on

record by the Board of Directors, we report that none

of the directors is disqualified as on 31st March 2009

from being appointed as a director in terms of

Clause (g) of Sub-Section (1) of Section 274 of the

Companies Act, 1956.

(vi) Subject to the foregoing, in our opinion, and to the

best of our information and according to the

explanations given to us, the said accounts give the

information required by the Companies Act, 1956, in

the manner so required and give a true and fair view

in conformity with the accounting principles generally

accepted in India.

(a) in the case of the Balance Sheet, of the state of

affairs of the Company as at 31st March 2009;

(b) in the case of Profit and Loss Account, of the Profit

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.

For ANAND AMARNATH & ASSOCIATES

Chartered Accountants,

B.K. Amarnath

Place: Bangalore Partner

Date: 18th June 2009 M.No.: 026536

22

iv. In our opinion, and according to the information and

explanations given to us, there is adequate internal

control procedure commensurate with size of the

Company and the nature of its business for the

purchase of inventory and assets and for the sale of

goods. During the course of our audit we have not

observed any continuing failure to correct major

weakness in internal controls.

v. (a) According to the information and explanation given

to us, we are of the opinion that the transactions

that need to be entered into the register maintained

under Section 301 of the Companies Act, 1956

have been so entered.

(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 and

exceeding Rs.5,00,000 in respect of each party

during the year have been made at prices which

are reasonable having regard to the prevailing

market price at the relevant time.

vi. The Company has not accepted any deposits from the

public within the meaning of Section 58A of the

Companies Act, 1956.

vii. In our opinion, the internal audit system in the Company

during the year is adequate and commensurate to the

size and the nature of the business of the Company.

viii. To the best of our knowledge and as explained, the

Central Government has not prescribed maintenance

of cost records under Section 209 (1) (d) of the

Companies Act, 1956 for any product of the Company.

ix. On the basis of records produced before us, the

Company is generally been regular in depositing

undisputed statutory dues including Provident Fund,

Employees State Insurance, Income Tax, Sales Tax,

Customs Duty, Excise Duty and Service Tax. According

to the information and explanations given to us, there

are no undisputed amounts payable in respect of

Provident Fund, Sales Tax, Customs Duty, Excise Duty

ANNEXURE TO THE AUDITOR'S REPORT

(Referred to in Paragraph 3 of our Report of even date on

the accounts of ADVANCED MICRONIC DEVICES LTD.

for the year ended 31st March 2009)

i. (a) The Company has maintained proper records

showing full particulars including quantitative

details and situation of fixed assets.

(b) Physical verification of Fixed Assets is performed

by the management in a regular programme for

verification once in a year. In our opinion, the

frequency of verification is reasonable, having

regard to the size and the nature of its business.

(c) There was no substantial disposal of fixed assets

during the year.

ii. (a) We are informed that the physical verifications of

inventories except inventories lying with the third

parties were conducted by the management at

reasonable intervals. 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 has maintained proper records of

inventories. According to the records produced to

us, no discrepancies were noticed on verification

between physical stocks and stock records.

iii. (a) As per the explanation given to us the Company

has given loans to the parties listed in the register

maintained under Section 301 of the Companies

Act, 1956, the rate of interest and other terms and

conditions of such loans given are not prejudicial

to the interest of the Company.

(b) As per the explanation given to us the Company

has taken loans from the parties listed in the

register maintained under Section 301 of the

Companies Act, 1956, and there was no payment

of any interest by the Company during the year.

23

and Service Tax except Income Tax, as per Note

No. 14 which are outstanding as on 31st March 2009

for a period of more than six months from the date on

which they became payable.

x. The Company has no accumulated losses and has

not incurred cash losses during the current financial

year and in the immediately preceding financial year.

xi. During the year, the Company has taken additional

Term Loan from Banks / Financial Institutions it has

not defaulted in repayment of its dues to financial

institutions and banks.

xii. In our opinion and according to the information and

explanations given to us, and based on the documents

and records produced to us, the Company has not

granted any loans and advances on the basis of

security by way of pledge of shares, debentures and

other securities.

xiii. In our opinion and according to the information and

explanations given to us, the nature of activities of the

Company does not attract any special status applicable

to Chit-Fund and Nidhi / Mutual Benefit Fund /

Societies, accordingly Clause 4 (xii) of the order is not

applicable.

xiv. In our opinion, the Company is not dealing or trading

in shares, securities, debentures or other investments

and hence, the requirement of Clause 4 (xiv) of the

order is not applicable to the Company.

xv. In our opinion and according to the information and

explanations given to us, the terms and conditions on

which the Company has not given guarantee for loans

taken by its subsidiary from a bank or Financial

Institutions, accordingly Clause 4(XV) of the order is

not applicable.

xvi. In our opinion and based on information and

explanations given to us by the management, term

loans have been applied for the purpose for which they

were obtained.

xvii. According to the information and explanations given

to us and on an overall examination of the balance

sheet of the Company, we report that no funds raised

on short-term basis have been used for long-term

purpose. No long-term funds have been used to finance

short-term assets except permanent working capital.

xviii.The Company has not made any preferential allotment

of shares to parties and companies covered in the

register maintained under Section 301 of the

Companies Act, 1956, during the year.

xix. The Company has not issued debentures during the

financial year.

xx. The Company has not raised any money through a

public issue during the year.

xxi. On the basis of our examination and according to the

information and explanations given by the

management, we report that no fraud on or by the

Company has been noticed or reported during the

course of our audit.


Chartered Accountants,

B.K. Amarnath

Place: Bangalore Partner

Date: 18th June 2009 M.No.: 026536

24

BALANCE SHEET

SCHEDULE As on As on31-03-2009 31-03-2008

Rs. Rs.

I. SOURCES OF FUNDS :

SHARE HOLDERS FUNDCapital A 52,811,000 52,811,000Reserves & Surplus B 135,400,094 126,474,035

LOAN FUNDSSecured Loans C 122,317,288 124,366,692

DEFERRED TAX LIABILITY (NET) 3,345,275 5,056,275

TOTAL 313,873,657 308,708,002

II. APPLICATION OF FUNDS :

FIXED ASSETSGross Block D 138,604,161 123,685,570Less Depreciation 41,910,634 31,335,237

Net Block 96,693,527 92,350,333

INVESTMENTS E 2,850,225 2,850,225

CURRENT ASSETS, LOANS & ADVANCES : FInventories 291,088,202 267,599,074Sundry Debtors 363,476,505 315,849,850Cash & Bank Balances 46,891,950 52,288,859Loans & Advances 32,702,250 49,765,476

734,158,907 685,503,259

Less : Current Liabilities & Provisions GLiabilities 461,624,588 415,759,547Provisions 58,204,414 56,236,268

Net Current Assets 214,329,905 213,507,444

TOTAL 313,873,657 308,708,002

Notes forming part of accounts M

Significant Accounting Policies N

For and on behalf of the Board of Directors As per our report of even dateFor ANAND AMARNATH & ASSOCIATES


Vinod Ramnani Bhaskar Valiveti Rose Chintamani B.K. AmarnathChairman & Managing Director Director Company Secretary Partner

M.No.: 026536Place : BangaloreDate : 18th June 2009

25

PROFIT & LOSS ACCOUNT

SCHEDULE For the Year Ended For the year Ended31-03-2009 31-03-2008

Rs. Rs.

INCOME

Sales H 585,812,493 524,209,998Other Income I 2,454,346 1,899,732

TOTAL 588,266,839 526,109,730

EXPENDITURE

Cost of goods sold J 398,307,482 333,449,968Administrative & Selling Expenses K 126,496,417 117,090,358Financial Charges L 18,340,297 19,948,565Depreciation D 10,560,876 10,006,153

TOTAL 553,705,072 480,495,044

Profit for the year before Tax 34,561,767 45,614,686

Provision for Taxation 15,000,000 16,028,000Deferred Tax (1,711,000) (35,000)Provision for FBT 1,480,476 1,294,579

Profit After Tax 19,792,291 28,327,107

Add/(Less) : Extraordinary / Prior Year Adjustment (4,844,457) (17,882,055)

Profit After Prior Year Adjustments 14,947,834 10,445,052

Profit brought forward from Previous Year 41,383,195 43,765,071

Profit available for appropriation 56,331,029 54,210,123

Amount Transferred to General Reserve 384,531 783,379Proposed Dividend 5,281,100 10,562,200Tax on Distributed Profits 740,675 1,481,349

Profit carried to Balance Sheet 49,924,723 41,383,195

Number of Equity Shares 5,281,100 5,281,100

Basic & Diluted earnings per equity share (Rs.)(Face value of Rs. 10/- per share)Before Extraordinary / Prior year Adjustment 3.75 5.36

Basic & Diluted earnings per equity share (Rs.)(Face value of Rs. 10/- per share)After Extraordinary / Prior year Adjustment 2.83 1.98

Notes forming part of accounts M

Significant Accounting Policies N

For and on behalf of the Board of Directors As per our report of even dateFor ANAND AMARNATH & ASSOCIATES



M.No.: 026536Place : BangaloreDate : 18th June 2009

26

CASH FLOW STATEMENT

For the Year Ended For the year Ended31-03-2009 31-03-2008

Rs. Rs.

CASH FLOW FROM OPERATING ACTIVITIESNet profit before tax & extraordinary items 34,561,767 45,614,686Adjustments for non operating items

Amortisation and other non cash items (1,711,000) (1,152,040)Depreciation 10,560,876 10,006,153Dividend received for the year (32,648) —Interest paid on borrowings 18,340,297 19,948,565Interest received on Fixed Deposit (2,345,078) (1,837,020)(Profit)/Loss on sale of Fixed Assets (76,620) 142,040

59,297,594 72,722,384Adjustments for working capital

(Increase)/Decrease in inventories (23,489,128) 11,474,483(Increase)/Decrease in loans & advances 17,063,225 8,772,449(Increase)/Decrease in sundry debtors (47,626,655) (93,727,595)Increase/(Decrease) in current liabilities 47,833,187 77,506,100Cash operating profit/(loss) before income tax 53,078,223 76,747,821Income tax (14,769,476) (17,287,579)

Cash flow from operating activities before 38,308,747 59,460,242extraordinary items

Extraordinary items & Previous years transactions (4,844,457) (17,882,055)Net cash flow from operations 33,464,290 41,578,187

CASH FLOW FROM INVESTING ACTIVITIESDividend Income 32,648 —Interest received on Fixed Deposit 2,345,078 1,837,020Proceeds from sale of Fixed Assets 300,000 1,010,000Proceeds from sale of investments (net) — —Total inflow of cash from investing activities 2,677,726 2,847,020Purchase of Fixed Assets (15,127,450) (2,830,305)

Net cash flow from investing activities (12,449,724) 16,715

CASH FLOW FROM FINANCING ACTIVITIESProceeds from long term borrowings (2,049,404) (21,409,257)Net proceeds from short term borrowings — —Inflow of cash (2,049,404) (21,409,257)Interest paid on borrowings (18,340,297) (19,948,565)Dividend paid (5,281,100) (10,562,200)Corporate dividend tax paid (740,675) (1,670,577)

Net cash flow from financing activities (26,411,476) (53,590,599)Total increase in cash & cash equivalents during the year (5,396,910) (11,995,697)Cash & cash equivalents at the beginning of the year 52,288,860 64,284,557Cash & cash equivalents at the end of the year 46,891,950 52,288,860

Note : Figures in brackets represent outflowsFor and on behalf of the Board of Directors

Place : Bangalore Vinod Ramnani Rose ChintamaniDate : 18th June 2009 Chairman & Managing Director Company Secretary

AUDITOR’S CERTIFICATEWe have examined the above Cash Flow Statement of Advanced Micronic Devices Limited, for the year ended 31st March 2009. The statement has beenprepared by the Company in accordance with the requirement under Clause 32 of the Listing Agreement with the Stock Exchanges and is based on andis in agreement with the corresponding Profit & Loss Account and Balance Sheet of the Company for the year ended 31st March 2009.

As per our report of even dateFor ANAND AMARNATH & ASSOCIATES


Place : Bangalore B.K. AmarnathDate : 18th June 2009 Partner

M. No.: 026536

27

SCHEDULES TO THE BALANCE SHEET

As on As on31-03-2009 31-03-2008

Rs. Rs.

SCHEDULE - A :

Share Capital Authorised :

1,00,00,000 (P.Y. 1,00,00,000) Equity Shares of Rs.10/- Each 100,000,000 100,000,000

Issued Capital :

52,81,100 (P.Y. 52,81,100) Equity Shares of Rs.10/- each 52,811,000 52,811,000(Out of which 650,000 equity shares of Rs.10/- each were capitalisedby way of Bonus Shares during the year 1992-93 & 1994-95)

Subscribed Capital :

52,81,100 (P.Y. 52,81,100) Equity Shares of Rs.10/- each 52,811,000 52,811,000(Out of which 650,000 equity shares of Rs.10/- each werecapitalised by way of Bonus Shares during the year 1992-93 & 1994-95)

Paid-up Capital :

52,81,100 (P.Y. 52,81,100) Equity Shares of Rs.10/- each 52,811,000 52,811,000(Out of which 650,000 equity shares of Rs.10/- each werecapitalised by way of Bonus Shares during the year 1992-93 & 1994-95) 52,811,000 52,811,000

SCHEDULE - B :

Reserves & Surplus :

A. Securities Premium 77,554,261 77,554,261

B. General Reserve:

As per last Balance Sheet 7,536,579 6,753,200Add : Transfer from Profit & Loss Account 384,531 783,379

TOTAL (B) 7,921,110 7,536,579

C. Profit & Loss Account balance 49,924,723 41,383,195

TOTAL (A+B+C) 135,400,094 126,474,035

SCHEDULE - C :

Secured Loans :

Term Loan From Banks & Financial Institutions* 3,300,262 7,407,803

Working Capital Advances from Banks** 113,750,210 114,470,955

Other Term Loans*** 5,266,816 2,487,934

122,317,288 124,366,692

* Secured by hypothecation of Fixed Assets** Secured by hypothecation of Stocks & Book Debts*** Secured by hypothecation of Vehicles

28

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29

SCHEDULES TO THE BALANCE SHEET (Continued)

As on As on31-03-2009 31-03-2008

Rs. Rs.

SCHEDULE - E :Investments : No. of

Shares

a) Quoted Shares at Cost :

Ambuja Cements Ltd. 5250 129,776 129,776Centum Electronics Ltd. 700 7,000 7,000Gold Stone Technologies Ltd. 400 90,431 90,431HDFC Bank Ltd. 900 9,000 9,000Hindustan Lever Ltd. 1000 296,226 296,226ICICI Bank Ltd. 500 127,925 127,925IDBI Ltd. 704 29,820 29,820Infosys Technologies Ltd. 480 462,259 462,259Intense Technologies Ltd. 100 69,385 69,385Navaneeth Publication Ltd. 1200 55,134 55,134NIIT Ltd. 187 96,071 96,071NIIT Technologies Ltd. 55 — —Samrat Ashoka Exports Ltd. 200 12,000 12,000Siemens Ltd. 750 28,385 28,385Silverline Technologies Ltd. 800 356,610 356,610Sonata Software Ltd. 600 67,780 67,780Sri Adhikari Bros Ltd. 580 367,793 367,793Sundaram Fastners Ltd. 4500 146,379 146,379Tata Chemicals Ltd. 1750 172,920 172,920TISCO Ltd. 450 33,538 33,538Titan Industries Ltd. 100 4,972 4,972Wockhardt Ltd. 600 85,021 85,021

Total - a 2,648,425 2,648,425

b) Unquoted Investment at Cost :

Microland Ltd. 10 102,000 102,000Micronic Healthcare Pvt. Ltd. 998 99,800 99,800

Total - b 201,800 201,800

Aggregate cost of Quoted Investments Rs.26,48,425 Marketvalue Rs.33,28,901 (P.Y.51,69,345) as on 31.03.09 oras on last quoted date. Unquoted investments Rs.2,01,800market value Rs.2,01,800 as determined by the Directors(after accounting for the impairment loss in the valueof the unquoted shares)

TOTAL (a+b) 2,850,225 2,850,225

SCHEDULE - F :Current Assets, Loans & Advances :

A. Inventories

(Valued at lower of cost or net realisable valueas certified by the Management)Stock in Trade 258,093,198 267,599,074Project work in Progress 32,995,004 —

TOTAL 291,088,202 267,599,074

30

SCHEDULES TO THE BALANCE SHEET (Continued)

As on As on31-03-2009 31-03-2008

Rs. Rs.

B. Sundry Debtors

(unsecured considered good, for whichthe Company holds no security other thanthe debtor’s personal security)

Debts outstanding for a period exceeding six months 139,102,980 72,063,148Other Debts 224,373,525 243,786,702

TOTAL 363,476,505 315,849,850

C. Cash & Bank Balances

Deposit & Other Accounts 35,385,445 34,320,969Current Accounts 11,356,388 17,757,350Cash on hand 150,117 210,540

TOTAL 46,891,950 52,288,859

D. Loans & Advances

(Unsecured considered good, receivablein cash or in kind or for value to be received)

Advances to suppliers 4,392,232 19,189,881Others Advances 12,244,621 14,608,245Staff Advance 302,528 2,505,349Deposits 3,167,263 3,868,490Income tax paid for AY 95-96 & 96-97 4,717,663 4,717,663Advance Tax & Tax Deducted at Source 7,877,943 4,875,848

TOTAL 32,702,250 49,765,476

SCHEDULE - G :Current Liabilities & Provisions:

Current Liabilities :

Sundry Creditors - SME units 6,946,479 11,872,781Others 193,695,359 124,138,218

Advance from Customers 4,624,408 11,426,579Advance from Others 229,024,900 243,614,463Other Statutory Dues Payable 10,558,781 10,328,790Liabilities for Expenses 14,807,189 12,809,243Unpaid Dividend 1,967,472 1,569,473

TOTAL 461,624,588 415,759,547

Provisions :

Provision for Taxation 40,146,509 35,598,261Provision for Fringe Benefit Tax 2,810,661 2,745,571Provision for Interest on FBT 433,390 —Provision for Gratuity 4,364,077 3,523,413Provision for leave encashment 1,139,408 826,125Provision for Proposed Dividend 5,281,100 10,562,200Provision for Tax on Proposed Dividend 3,703,373 2,962,698Provision for Interest on Dividend Tax 325,896 —Provision for Wealth Tax — 18,000

TOTAL 58,204,414 56,236,268

31

SCHEDULE - H :

Sales :

USA Branch 128,472,047 120,353,713

Local 440,811,188 392,138,336

Commission Received 16,529,258 11,717,949

TOTAL 585,812,493 524,209,998

SCHEDULE - I :

Other Income :

Dividend Income 32,648 —

Interest Received 2,345,078 1,837,020

Profit on Sale of Asset 76,620 62,712

TOTAL 2,454,346 1,899,732

SCHEDULE - J :

Cost of Goods Sold :

Materials Consumed 375,243,665 308,926,800

Power & Fuel 382,403 356,831

Service Charges 17,737,379 19,016,045

Insurance 927,506 1,271,949

Spares - Materials 4,016,529 3,878,343

TOTAL 398,307,482 333,449,968

SCHEDULE - K :

a. Administrative & Selling Expenses :

Advertisement 309,143 559,709

AGM Expenses 33,990 34,000

Commission paid 1,976,587 4,568,198

Conveyance & Vehicle Maintenance 5,994,677 5,812,602

Directors Remuneration 2,892,000 2,865,830

Discount Allowed 836,349 4,802,388

Electricity & Water Charges 792,858 913,127

Freight Charges 1,872,887 2,517,355

Loss on Sale of Assets — 204,752

SCHEDULES TO THE PROFIT AND LOSS ACCOUNT


Rs. Rs.

32

Membership & Subscription Fees 189,741 143,179

Office Maintenance 2,550,006 2,255,923

Packing materials 151,657 4,766

Postage, Telegraph & Telephones 6,245,971 6,224,904

Printing & Stationery 2,897,748 2,290,331

Professional & Consultancy fees 8,746,417 6,733,204

Rent, Rates & Taxes 4,697,004 4,121,610

Repairs & Maintenance 1,037,029 992,181

Sales Promotion 6,449,613 7,129,308

Security Charges 317,230 245,194

Seminar Expenses 1,051,283 478,479

Statutory Audit fees 661,800 500,000

Tender Expenses 260,794 232,281

Travelling Expenses 11,749,593 11,254,126

Total - a 61,714,377 64,883,447

b. Staff Expenses :

Salaries & Allowances 62,907,860 50,051,273

Staff Welfare and Amenities 1,874,180 2,155,638

Total - b 64,782,040 52,206,911

TOTAL (a+b) 126,496,417 117,090,358

SCHEDULE - L :

Financial Charges :

Interest on Working Capital 15,015,939 15,229,757

Interest on Term Loan 628,202 2,542,169

Interest on Vehicle Loan 553,569 279,569

Bank Charges 2,142,587 1,897,070

TOTAL 18,340,297 19,948,565

SCHEDULES TO THE PROFIT AND LOSS ACCOUNT (Continued)


Rs. Rs.

33

NOTES FORMING PART OF ACCOUNTS


Rs. in Lakhs Rs. in Lakhs

SCHEDULE - M :1. CAPACITIES & PRODUCTION

a) Licensed Capacity NA NAb) Installed Capacity NA NAc) Production NA NA

2. CONTINGENT LIABILITIES

a) Letter of Credits 50.00 58.44b) Bank Guarantees 225.60 142.92

TOTAL 275.60 201.36

3. DETAILS OF COST OF SALES / SERVICE

Healthcare 2,596.11 1,998.70Information Technology 1,156.33 1,090.56

TOTAL 3,752.44 3,089.26

4. PARTICULARS OF SALES

Healthcare 3,449.55 3,034.01Information Technology 2,408.57 2,208.08

TOTAL 5,858.12 5,242.09

5. VALUE OF RAW MATERIALS CONSUMED% %

a) Indigenous 171.76 4.58 263.50 8.52b) Imported 3,580.68 95.42 2,825.76 91.48

TOTAL 3,752.44 100.00 3,089.26 100.00

6 QUANTITATIVE DETAILS

The Company is engaged mainly in Trading of goods of wide range in Health Care and IT products. The number ofitems and their accessories are voluminous in number with wide price range. Hence items cannot be grouped in tospecific categories since they are heterogenous and have different technical specifications. The details of the finishedgoods of the items manufactured by us is given below :

Opening Stock — —Production 6,83,840 Nos. 6,42,272 Nos.Sales 6,83,840 Nos. 6,42,272 Nos.Closing Stock — —

7. EARNINGS IN FOREIGN CURRENCY

a) Commission 158.95 110.42b) Export Income — 560.20

8. EXPENDITURE IN FOREIGN CURRENCY

a) Foreign Travel 11.72 13.70b) Materials (CIF Value) 2,107.02 2,490.11c) Capital Equipments (CIF Value) 47.56 0.80

34

9. REMUNERATION TO MANAGING DIRECTOR& WHOLE-TIME DIRECTORMANAGING DIRECTOR Nil Nil

WHOLE-TIME DIRECTOR :

a) Salary 26.40 26.40b) Contribution to Provident fund 2.52 2.52c) Medical Reimbursement — 2.26

The above payments are as per the provisions of Schedule XIII of the Companies Act, 1956.

10. The Company has an on going programme of periodic reconciliation of sundry debtors, sundry creditors, and loans &advances given / taken & Provisions wherever necessary have been made.

11. The Company has provided for the liability towards interest on FBT, dividend tax and statutory payments related toearlier years :

Particulars Year Amount in Rs.

Sales Tax 2005-06 3.23

Customs Duty 2006-07 3.50

Income Tax 2004-05 10.462005-06 23.65

Interest on FBT 2006-07 2.782007-08 1.55

Interest on dividend Tax 2006-07 2.522007-08 0.74

Wealth Tax 2007-08 0.01

12. The Company has provided for the Liability towards Gratuity Rs.43,64,077 and unavailed encashable earned leaveRs.11,39,408 on accrual basis.

13. Deferred Tax Asset as at 31st March 2009 represents the tax effect of temporary differences substantially on accountof differences in the written down value of fixed assets on account of differing depreciation methods/rates & othertiming differences, arising during the accounting year.

Deferred Tax liability at Beginning of the year 50.56 50.91Less : Deferred Tax Asset (17.11) (0.35)

Net Deferred Tax Liability 33.45 50.56

14. The Company has not paid undisputed Income Tax, Liabilities outstanding as on 31st March 2009 for a period of morethan 6 months from the date on which they became payable, as outlined below :

(Amount in Lakhs)

Financial Year Income Tax FBT Dividend Tax Total

2004-05 20.36 — — 20.362006-07 126.00 11.58 14.81 152.392007-08 115.00 12.94 14.81 142.752008-09 140.00 3.59 — 143.59

15. The appeal prepared by the Company for Assessment year 1995-96 and 96-97, filed before the Hon. High Court ofKarnataka was upheld by the Court against which the Department has not contested. Since a large amount is duefrom the Department which has to be adjusted against interest and tax liability payable by the Company, hence we areunable to quantify the interest liability. Company will account the interest liability after obtaining the refund order fromthe Income tax Department.

16. The Company had received notice for FY 2007-08, from the office of the Directorate General of Central ExciseIntelligence, Bangalore Zonal unit, We had furnished all details required by them. We have not received any replyfrom them so far. Hence contingent liability on this account cannot be quantified.

NOTES FORMING PART OF ACCOUNTS (Continued)



35

17. The appeal preferred by the Company before the settlement commission, Customs and Central Excise, Additionalbench, Mumbai for the year was considered by the settlement commission, The settlement commission had imposeda penalty of Rs.3.50 lakhs, which has been paid. There is no further liability on account of this.

18. AUDITOR’S REMUNERATIONStatutory Audit Fees 5.52 4.25Tax Audit Fee 1.10 0.75Other Services — —

19. Net effect of Foreign Exchange rate difference included in the net profit for the period is Rs.102.17 Lakhs Loss (P YRs.29.81 Lakhs (Loss))

20. LIST OF RELATED PARTIESEnterprises owing directly or indirectly, an interest in the voting power of the Company that gives control or significantinfluence over the Company.

I. Holding Company Opto Circuits (India) Ltd.

II. Fellow Subsidiaries Altron Industries Pvt. Ltd.Eurocor GmbH, GermanyMediaid Inc., USADevon Innovation Pvt. Ltd.Ormed Technologies Ltd.Opto Infrastructure Ltd.Criticare Systems Inc., USA

III. Key Management Personnel :Mr. Vinod Ramnani Chairman & Managing DirectorMr. Bhaskar Valiveti Whole-Time Executive Director

21. RELATED PARTY TRANSACTIONSDuring the year, the following transactions were carried out with the related party in the ordinary course of business.

Rs. in lakhs

Particulars Holding Company Key Management Fellow TotalPersonnel (Managing SubsidiariesDirector, Whole-Time

Director, Managerand other Managerial

Personnel)As on As on As on As on As on As on As on As on

31-03-09 31-03-08 31-03-09 31-03-08 31-03-09 31-03-08 31-03-09 31-03-08

Loans & Advances 61.84 46.64 61.84 46.64Loans & Advances - Credit 647.89 647.89Purchase of Goods 60.21 47.12 60.21 47.12Sale of Goods 251.28 195.06 251.28 195.06Purchase of Fixed AssetsSale of Fixed AssetsRendering of Services 28.92 31.18 28.92 31.18Receipt of Services 4.23 2.37 4.23 2.37Sundry Debtors 45.42 51.19 45.42 51.19Agency ArrangementDividend Payments 63.06 63.06 63.06 63.06Licence ArrangementFinance (including loans &equity contributionin cash or in kind)Guarantees & Collaterals




36

22. SEGMENT REPORTSegment Revenue(Net sales incl. of Excise duty)a) Healthcare

Northern Region 656.68 493.18Rest of India 2,792.87 2,540.83

b) Information TechnologySouthern Region 1,459.78 1,485.49Rest of India 948.79 722.59

c) Others 24.54 19.00Total Segment Revenue 5,882.66 5,261.09

Segment Results(Profit before Interest & Tax)a) Healthcare

Northern Region 56.48 59.49Rest of India 240.11 306.49

b) Information TechnologySouthern Region 125.98 183.41Rest of India 81.91 87.24

c) Others 24.54 19.00Total Segment Profits 529.02 655.63Less : Interest 183.40 199.49Total Profit before Tax 345.62 456.14

Capital Employed(Segment Assets - Segment Liabilities)

a) Health Care 1,884.04 1,705.45b) Information Technology 697.10 1,148.10c) Others 564.36 487.25

1. Segments have been identified in accordance with Accounting Standard 17 “Segment Reporting”, considering theorganisation structure & the return / risk profiles of the business. The Management Information system recognizes& monitors these segments on a continuous basis.

2. Segment revenue includes sales & other income directly identifiable with the segment & allocable to it.3. Assets used in the Company’s business or liabilities contracted have been identified to the reportable segments.

Unallocable Assets used / liabilities contracted used in Corporate office have been separately shown.

23. The Income, expenditure and other financials of USA Branch have been consolidated with the Company's accounts.No separate profitability statements have been prepared. These accounts are not Audited. These accounts have beenadopted based on the Certification of the Branch Head.

24. Details of Term loan paid during the yearTerm Loan (Secured by Hypothecation of Building & FD) 41.07 188.98Vehicle Loan (Secured against hypothecation of Vehicles) 16.35 13.09

25. Dues to Micro and Small EnterprisesThe amount due to Micro and Small Enterprises as defined in the "The Micro, Small and Medium EnterprisesDevelopment Act, 2006" has been determined to the extent such parties have been identified on the basis of informationavailable with the Company. The disclosures relating to Micro and Small Enterprises as at 31st March 2009 are asUnder :The total amount due to such enterprises 69.46 118.73There is no interest payable for such delayed payments.

26. The Company capitalised product development expenditure to the tune of Rs.2,44,23,535 during FY 2006-07 underintangible assets. This is being amortised for the 2nd year over a period of 5 years.

27. Previous year figures have been regrouped & reclassified to correspond with the current year’s classification.


For the Year Ended For the year EndedParticulars 31-03-2009 31-03-2008


37

SCHEDULE - N :

STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES :

a. Basis of preparation of financial statements

The financial statements have been prepared to comply in all material respects with the mandatory Accounting Standards

issued by the Institute of Chartered Accountants of India and the relevant provisions of the Companies Act, 1956. The

financial statements have been prepared under the historical cost convention on an accrual basis. The accounting

policies have been consistently applied by the Company and except for the changes in accounting policy discussed

more fully below, are consistent with those used in the previous year.

b. Use of Estimates

The preparation of financial statements requires management to make estimates and assumptions that affect the

reported amounts of assets and liabilities, the disclosure of contingent liabilities on the date of the financial statements

and the reported amounts of revenues and expenses during the period reported. Actual results could differ from those

estimates. Any revision to accounting estimates is recognised in accordance with the requirements of the respective

accounting standard.

c. Fixed Assets

Fixed assets are stated at cost less accumulated depreciation and impairment losses. Cost comprises purchase price,

duties, levies and any other costs relating to the acquisition and installation of the assets. Interest and financing

charges on borrowed funds, if any, used to finance the acquisition of fixed assets, until the date the assets are ready

for use are capitalized and included in the cost of the asset.

d. Depreciation

Depreciation is provided on Straight Line method at the rates equal to the corresponding rates prescribed in

Schedule XIV of the Companies Act, 1956. Proportionate depreciation is charged for additions / deletions during the

year on the assets situated in India. For, Assets situated outside India, depreciation is calculated on the basis of

estimated useful life of that asset.

Schedule XIV Rates (SLM)

Building 1.63%

Plant & Machinery 4.75%

Computers (included in plant and machinery) 16.21%

Furniture and Fixtures 6.33%

Vehicles 9.50%

e. Intangibles

Research and Development Costs : Research costs are expensed as incurred. Development expenditure incurred on

an individual project is capitalised. Intangible assets are amortised over their respective useful life on straight line

basis.

The carrying value of development costs is reviewed for impairment annually when the asset is not yet in use, and

otherwise when events or changes in circumstances indicate that the carrying value may not be recoverable.

f. Deferred Tax

Deferred Tax Assets & Liabilities are recognized for the estimated future tax consequences of temporary differences

between the carrying value of the assets and liabilities and their respective tax bases. Deferred Tax Asset in the nature

of unabsorbed depreciation and loses are recognized only if there is virtual certainty of realization. The effect on

deferred tax asset and liabilities of a change in rates is recognized in the income statement in the period of enactment

of the change.

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g. Leases

Finance leases, which effectively transfer to the Company substantially all the risks and benefits incidental to ownership

of the leased item, are capitalized at the lower of the fair value and present value of the minimum lease payments at

the inception of the lease term and disclosed as leased assets. Lease payments are apportioned between the finance

charges and reduction of the lease liability based on the implicit rate of return. Finance charges are charged directly

against expenditure Lease management fees, legal charges and other initial direct costs are capitalised.

Operating Lease : Office premises are obtained on operating lease. The lease term varies from 11 months to 36

months and is renewable for further period at the option of the Company. Each lease agreement is bound by specific

escalation clause. There is no restrictions imposed by lease agreements. There are no sub-lease.

h. Investments

Current investments are valued at lower of cost or fair market value. Long term investments are stated at cost less

permanent diminution, if any, in value.

i. Inventories

Inventories are valued as follows :

Raw materials, components, stores and spares : Lower of cost and net realizable value. Cost is determined on a

weighted average basis.

Finished goods : Lower of cost and net realizable value. Cost includes direct materials and labour. Cost of finished

goods includes excise duty.

Net realizable value is the estimated selling price in the ordinary course of business, less estimated costs of completion

and to make the sale.

j. Revenue recognition

Revenue is recognized to the extent that it is probable that the economic benefits will flow to the Company and the

revenue can be reliably measured.

Sale of Goods : Revenue is recognised when the significant risks and rewards of ownership of the goods have passed

to the buyer.

Interest : Revenue is recognised on a time proportion basis taking into account the amount outstanding and the rate

applicable.

Dividends : Revenue is recognised on actual receipt of Dividend.

k. Foreign currency translation

Foreign currency transactions are recorded at the rates of exchange prevailing on the date of the transactions. Foreign

currency assets and liabilities are translated into rupees at the exchange rates prevailing on the balance sheet date.

Exchange differences in translation of foreign currency assets and liabilities and realized gains and losses on foreign

exchange transactions, other than those relating to fixed assets, are recognized in the profit and loss account.

l. Retirement benefits

i. The Company’s liability on accrual basis towards retirement benefit in the form of Provident fund, gratuity and

earned leave encashment are provided for and charged to revenue expenditure.

ii. The Company contributes to the Employee Provident fund maintained under the EPF scheme of the Central

Government.

iii. The Gratuity liability is provided and charged off as revenue expenditure based on Actuarial valuation.

iv. Actuarial gains / losses at the time of settlement are immediately taken to the profit and loss account and are not

deferred.

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m. Statutory Levies & Taxes

The Company follows mercantile system of accounting with respect to transactions in the normal course of business.

However, with respect to the effect of the outcome of tax assessments, appeals & proceedings, the Company records

the same on determination or completion & disposal.

Deferred Tax Assets & Liabilities are recognized for the estimated future tax consequences of temporary differences

between the carrying value of the assets & liabilities and their respective tax bases. Deferred Tax Asset in the nature

of unabsorbed depreciation and loses are recognized only if there is virtual certainty of realization. The effect on

deferred tax asset & liabilities of a change in rates is recognized in the income statement in the period of enactment of

the change.

n. Segment Reporting Policies

Identification of segments : The Company’s operating businesses are organized and managed separately according

to the nature of products and services provided, with each segment representing a strategic business unit that offers

different products and serves different markets. The analysis of geographical segments is based on the areas in which

major operating divisions of the Company operate.

Intersegment Transfers : The Company generally accounts for intersegment sales and transfers as if the sales or

transfers were to third parties at current market prices.

o. Earnings Per Share

The basic earning per share is computed by dividing net profit after tax by the weighted average number of equity

shares outstanding for the period. Diluted earnings per share have not been computed, as the Company has not

issued any Diluted Potential Equity Shares.

p. Cash flow Statement

Cash flows are reported using the indirect method, whereby net profit before tax is adjusted for effects of transactions

of non-cash nature and any deferrals or accruals of past or future cash receipts or payments. The cash flows from

regular revenue generating, investing and financing activities of the Company are segregated.

For and on behalf of the Board of Directors As per our report of even date




M.No.: 026536

Place : Bangalore

Date : 18th June 2009

40

BALANCE SHEET ABSTRACT & COMPANY’S GENERAL BUSINESS PROFILE

1. Registered Details

Registration Number 15445 State Code 08

Balance Sheet Date 31-03-2009

2. Capital raised during the year (Amount in Rs. Thousands)

Public Issue NIL Rights Issue NIL

Bonus Issue NIL Private Placement NIL

3. Position of mobilization & deployment of funds (Amount in Rs. Thousands)

SOURCES OF FUNDS APPLICATION OF FUNDS

Total Liabilities 313,873 Total Assets 313,873

Paid Up Capital 52,811 Net Fixed Assets 96,693

Reserves & Surplus 135,400 Investments 2,850

Secured Loans 122,317 Net Current Asset 214,330

Deffered Tax Liability 3,345

4. Performance of Company (Amount in Rs. Thousands)

Turnover 588,267 Total expenditure 553,705

Profit before tax 34,562 Profit after tax 19,792

Earning per Share (in Rs.) 2.83 Dividend rate 10%

5. Generic names of two Principal products / services of Company (as per monetary terms)

Item Code No. (ITC Code) Product Description

9,018.90 Cardiac Care Equipments & Devices

8,524.20 Software

For and on behalf of the Board of Directors

Place : Bangalore Vinod Ramnani

Date : 18th June 2009 Chairman & Managing Director

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