Andhra Petrochemicals Ltd March 2010

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THE

ANDHRA PETROCHEMICAL

LIMITED



www.reportjunction.com

THE ANDHRA PETROCHEMICALS LIM

Board of Directors

Sri M R B Punja (Chairman)

Dr. Mullapudi Ha rischandra Prasad(Managing Director)

Dr. B B Ramaiah

Sri Justice G Ramanujam (Retd.)

Sri A A Krishnan

Dr. Anum olu Ram akrishna

Sri Surinder Kumar K apoor

Bankers

State Bank of India

State Bank of HyderabaAndhra Bank

Registered Office

Venkatarayapuram

T a n u k u - 5 3 4 2 1 5

West Godavari District




NOTICENOTICE is hereby given that the Twenty Sixth Annual GeneralMeeting of THE ANDHRA PETROCHEMICALS LIMITED will

be held at the Re g i s t e re d O f f i c e of the Company ,Venkatarayapuram.Tanuku -534215, V\test Godav ari District,Andhra Pradesh on Thursday, the 30

thSptember, 2010 at

3:00 p.m. to transact th e following business:

1. To receive, consider and adopt the Audited Profit andLoss Account for the year ended 31

stMarch, 2010 and

the Balance Sheet as at that date and the Reports ofthe Board of Directors and Auditors thereon.

2 . To appo in t a Directo r in p lace o f Dr. Anu mo luRamakrishna who retires by rotation and being eligibleoffers himself for reappointment.

3. To appoint a Director in place of Sri P. NarendranathChow dary w ho retires by rotation and being eligible offers

The Andhra

NOTES:

1. The relative Explanatory

Section 173(2) of the C

respect of Item Nos.6 an

2. A Member entitled to

Meeting is entitled to app

to attend and vote inste

Proxy need not be a MProxy Forms duly stamp

reach the Registered Of

less than 48 hours befor

the Meeting.

3. The Register of Memb

Books of the Company

Monday, the 20th

Septem

th




The Andhra Petrochemicals Limited

Other Directorships held:Director - TheAndhra Sugars Ltd., GVK Jaipur ExpresswayPvt. Ltd.,The KCP Ltd., Madras Cements Ltd., RamcoIndustires Ltd.,Taj GVK Hotels and Resor ts Ltd., GVKIndustires Ltd., GVK Gautami Power Ltd., Internat ionalInfrastructure Consultants Pvt. Ltd., GVK Power & InfrastructureLtd., SPEL Semiconductor Ltd.,Teesta Urja Ltd., BrigadeEnterprises Ltd., and Mumbai International Airport Pvt. Ltd.

Other Committeeships held:

Member-Audits Compensation Committee, Madras CementsLtd; Audit Committee, Ramco Industries Ltd., The KCP Ltd.,SPEL Semiconductor Ltd.,GVK Power & Infrastructure Ltd.,

GVK Gautami Power Ltd.,Teesta Urja Ltd.,and BrigadeEnterprises L td.; Chairman -Audit Committee, Taj GVK Hotels& Resorts Ltd., and GVK Jaipur Expressway Pvt. Ltd.

He does not hold any Equity Shares in the Company.

Annexure to Notice

E X P L A N A T O R Y S T A T E MSECTION 173(2) OF THE C

ITEM NO.6:

Sri M. Venkateswara Rao is a Grand Postgraduate in Business AdmMember of The Institute of CompAssocia te Member of The In

Accountants of India. He is presGeneral Manager (Accounts) oDevelopment Corporation Ltd.,years of experience as CompanInvestment A greeme nt entered inominated as its Director on the BSri M. Venkateswara Rao was co-oon the Board of the Company Pursuant to Section 260 of the CoArticle 97 of the Articles of AssocVenkateswara Rao holds office o




DIRECTORS' REPORTDear Shareholders,

Your Directors have pleasure in presenting the Twenty

Sixth Annual Report of the Company together with the

Audited Accounts fo r the yearended 31st

March, 2010.

FINANCIAL RESULTS:

Performance of the Company fort h e Financial Yearended 31

stMarch, 2010 is summarised below:

(Rs. in lakhs)

Net Sales (excl. Excise Duty)

Profit before Interest &Depreciation

2009-10

13714.27

486.74

2008-09

24493.84

4008.52

Th e Andhra

CAPITAL & RESERVES:

Authorised and Paid-up Ca

Th e Authorised Capital of theand the Paid-up Capital is Rs.

Reserves:

The total Reserves posit ionRs.76.90 crores against Rs.82.2

MANAGEMENT DISCUSSIO

Industry Structure and Dev

The Oxo-Alcohols business inmain activity of your Companhealthy rate of 8% - 10% per come out of the recessionary trpart of 2008-09 and 2009-10 an




Th e Andhra Petrochemicals Limited

Future Outlook:

Consequent upon enhancement of production capacityfrom 39,000 MTPA to 73,000 MTPAw.e. f , 1

st May, 2010,your Com pany's market share is expected to be doubledcomp ared to earlier periods. The scale of econo miesthough still well below current world scale levels, placethe C ompany in a better position to compete with importswith an assured and improved supplies to the customers.

Cautionary Statement:

The s ta tements descr ib ing the Company 's out look,e s t i m a t e s o r p red ic t i ons may be fo rward - look ingstatements based on certain assumptions of future events.Actual results may differ materially from those expressedor implied, since the Co mpan y's operations are influenced

In accordance with the pro

Act, 1956 and Articles of As

Directors Dr. Anumolu Ramak

Chowdary and Sri M. Thimm

the ensuing 26 th Annual Ge

eligible, offer themselves fo r

AUDIT COMMITTEE:

Audi t Commi t tee consis ts

Independent Directors Sri Jus

Sri A A Krishnan, Dr. Anum

Pradeep Kumar Keshari. S

(Retd.) is the Chairman of th




ii) tha t Acco unting Policies have been selected and

app l ied cons is ten t l y a n d j u d g e m e n t s a n d

estimates made that are reasonable and prudent,

so as to give a true and fair view of the State of

Affairs of the Company at the end of the Financial

Year and of the Profit of the Company fo r that

year.

iii) that proper and sufficient care has been taken

fo r the maintenance of adequate account ing

records in accordance with the provisions of the

Companies Act, 1956 for safeguarding the Assets

of the Company and for preventing and detecting

fraud and other irregularities.

Th e Andhra

A. Conservation of Ene

Five Nos. of Energy

have been executed d

sulted in a saving of 5

ergy.

FORM

A. Power and Fuel Cons

Cur

1. Electricity:

a. Purchased

Units 1,

Total Amount (Rs.)5,





B. Technology Absorption :

FORMB

I. Research & Development (R & D)

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

the Company:

Th e C o m p a n y h as d e v e l o p e d s c h e m e s fo rModernisation-cum -Optimisation of the existing Oxo-Alcoh ols Plant thereby enh ancing Plant capacity from39,000 MTPA to 73,000 MTPA. Even tho ugh the Tech-nology as such has been provided by M/s D avy Pro-cess Technology Ltd., (DPT), UK, the schemes ofOptimisation using the existing process equipmentsand utilities to the maximum extent to result in mini-mum capital expenditure for Expansion has been

2. Benefits:

The Company has startedModernisation-cum-Optimprocess efficiencies and

sumption.

3. Imported Technology:

Th e process Licence and B

for the new Oxo Synthesisbeen supplied by M/s Davy

U K, th e Licensor for the ea

C. Foreign Exchange Earn

basis)-

For thend




Th e Andhra

Annexure 'C'to the Directors' Report:

REPORT ON CORPORATE GOVERNANCE

A. M ANDATORY REQU IREMENTS:

1. Company's philosophy on Corporate Governance:

Your Company affirms that adoption of the good Corporate Governance practices in aand actions is sine qua non for enhancement of overall shareholder value and prote

stakeholders including customers, employees, lenders, suppliers, government and toperates.

2. Board of Directors:

a) As on 31.3.2010 the Board consisted of 11 Directors.

Composition and category of Directors is as follows :

Non-Executive and

Independent Directors Promoter and Executive DirectorPromoters, Non-Ex

Non-independent D

Sri M R B Punja





3. Code of Conduct:

The Board of Directors has adopted the Code of Con-

duct for Board Members and Senior Management Per-

sonnel of the Company. The said Code has been com-

municated to the D irectors and the Senior Managers from

whom th e necessary affirmation has been received with

regard to the com pliance of the C ode. A declaration in

this regard by the Managing Director is furnished at theend of the report. The Code h as been posted on the

Company's website - www.andhrapetrochemicals.com.

4. Audit Committee:

A qualified Audit Committee, meeting the requirements

of Clause 49 of the L i s t i ng Agreemen t , h as been

constituted.

O Reviewing financial rep

control systems and pro

O Recommending to the B

appointment and if requ

removal of the Statutory

Audit Fees.

O Approval of payment to

an y service rendered byO Review with the Manag

yearly financial statemen

the Board for approval.

O The Audit Committee al

information as and when

Q Management Discuss

condition and results




9. CEO / CFO Certification:

In accordance with the requirements of Clause

49(V) of the Listing Agreement the Board of

Directors of the Company, the Audit Committee and

the Auditors have been furnished with the requisite

certificate from the Managing Director.

10. Shareholders / Investors Grievance

Committee:a) The Board has constituted Shareholders /

Investors Grievance Committee comprising Dr.

B B Ramaiah (Chairman of the Committee -

Non-Executive Director), Sri P Narendranath

Chowdary and Sri M Thimmaraja as Members

of the Committee. The Committee looks into

the redressal of the shareholders' complaints

like transfer of shares, non-receipt of Annual

The Andhra

Act, 1956 wi th rega

requiring the approval o

The Register of Contra

in which Directors are i

every meeting of the

Directors present.

ii) No penalties or strictu

Company fo r non-comp

/ SEBI or any authority

capital markets during

iii) The Com pany does no





v) Market price data: High/low price of Company's

Equity Shares quoted on The Bombay Stock

Exchange Ltd., Mumbai during each month of the

FinancialYear 2009-10.

Month

April, 2009

May, 2009

June, 2009

July, 2009

August, 2009

High

Rs. Ps.

13.00

17.00

19.50

17.65

15.68

Low

Rs. Ps.

9.03

10.70

13.80

12.35

13.45

viii) a) Shareholding pattern

SINo.

1

2

34

5

6

7

8

Category

Promoters, Directors,

Relatives and Associate

Companies

Financial Institutions

Mutual FundsBanks

Foreign Institutional Investo

Non-Resident Indians

Bodies Corporate

Indian Public

Total

b) Distribution of shareholding




The Andhra

CEO's declaration on compliance with the Company's Code of C

As provided under Clause 49 of the Listing Agreement with th e Stock Exchange, aSenior Management Personnel have aff irmed th e compliance of the Company's CBoard Members and Senior Management Personnel, as applicable, for the year end

Place : Visakhapatnam Dr. MULLAPUDI HARIDate : 5-8-2010 Mana

AUDITORS' CERTIFICATEToThe Members ofThe Andhra Petrochem icals Limited,Tanuku.

We have examined the compliance of conditions of Corporate Governance by Th e Andhra Petrocfor th e year ended March 31, 2010, as stipulated in Clause 49 of the Listing Agreement of thechange.

The compliance of conditions of Corporate Governance is the responsibility of the manageme





A N N E X U R E T O T H E AUDITORS' REPORT

REFERREDTO IN PARAGRAPH 3 OF OUR REPORT

OF EVEN DATE:

i) a) The Company has maintained proper records

showing full particulars, including quantitativev)

a)

details and situation of fixed assets.

b) Th e fixed assets have been physically verifiedby the management during the year.

According to the information furnished to us,

no material discrepancies have been noticed

on such verification. '-')

c) The Fixed Assets disposed off by the

Company during the year do not form a

substantial part thereof.

and the nature of i

purchase of invent

of goods and servi

our audit, no ma

noticed in the intern

According to the inf

given to us, we ar

particulars of contraneed to be entered i

undersection 301 o

have been so enter

In our opinionand a

and explanations g

and arrangements

contracts or arran




with the respective authorities in respect of

Income Tax, Sales Tax, V\fealth Tax, Service

Tax, Customs Duty, Excise Duty and Cess.

x) The Company has no accumulated losses

and has not incurred cash losses in the

financial year covered by our audit and the

immediately preceding financial year.

xi) The Company has not defaulted in paymentof any loan installment or interest in respect

of term loans from financial institutions and

banks.

xii) The Company has not granted any loans or

advances on the basis of security by way of

pledge of shares, debentures and other

securities. Accordingly the clause 4(xii) of the

The Andhra

Accounting Policies1. General:

The ac counts are prepa redhistorical cost convention accounting standards specof section 211 of the Comp

2. Fixed Assets :a. Fixed assets are stat

depreciation. Cost ofis net of CENVAT / In

of freight, dut ies, taincluding interest oallotted.

b. Expenditure during cis included under Caal located to the recompletion of constru

3. Investments:Investments are stated at crelating to acquisition. Promarket value of long-term





Balance Sheet as at 31st

March, 2010(

Schedule No. As at 31-03

. SOURCES OF FUNDS :

1. Shareholders' Funds :

a)Share

Capitalb) Reservesan d Surplus

2. Loan Funds:

Secured Loans

18497.

2 7690.

16187.

3 14352.

14352.




Th e Andhra

Profit and Loss Account for the Year ended 31st March, 201

Schedule No. This Yea

INCOME :

Gross Sales (excludingsale of production out of trial run)

Less: Excise Duty collected

Cost of products used for testing of new Plant under installation

Increase / (decrease) of stocks 13

Other Income 14

14868.6

1154.3

13714.27

513.9

(1606.52

147.6





Schedules attached to and forming part of the Balance She

(R

As at 31-03-20

SCHEDULE - 1 - Share Capital:

Author ised:

8,50,00,000 Equity Shares of Rs.10/- each

Issued, Subscr ibed and Paid-up:

8,49,71,600 Equity Shares of Rs.10/- each

fully paid-up

Total

8500

8497

8497




SCHEDULE - 4 - Fixed Assets:

The Andhra

1 Land 9.07 - - 9.07

2 Buildings* 1169.03 - - 1169.03 400.92 26.753 Plant &

Machinery 21853.00 - 76.84 21776.16 16950.61 1160.54 40.57

4 Furniture &Office Equipment 162.98 11.65 12.35 162.28 114.60 12.09 10.66

5 Vehicles 30.32 29.41 - 59.73 20.72 3.43

Total 23224.40 41.06 89.19 23176.27 17486.85 1202.81 51.23

427.

18070.

116.

24.

18638.





(

As at 31-03-20

SCHEDULE - 6 - Investments:

Investment at cost:Long Term - Non-Trade - unquoted:

4,02,000 Equity Shares of Rs.10/- each

ful ly paid-up in Andh ra P radesh Gas

Power Corporat ion Ltd.

Total

SCHEDULE - 7 - Inventories (as certified by the Management):

Stores and Spares

526

526

1018




The Andhra

As at 31-03-20

SCHEDULE - 11 - Current Liabilities:

Creditors fo r Capital Works

Sundry Creditors *Other Liabilities

Advances received against SalesTrade Deposits

Interest Accrue d but not due on term loans

Unclaimed Dividends #

Total

451.3332.1

14.5

80.85.0

83.738.0

1005.6

* Includes Rs.Nil (previous year Rs. Nil) due to Micro Small and Medium Enterpri





This Y

SCHEDULE - 14 - Other Income:

Interest received (TDS Rs.17.02 lakhs

previous year Rs.124.76 lakhs)

Miscellaneous Receipts

Provisions no longer required

Exchange Variation Gain

Total

136

82

147

SCHEDULE - 15 - Staff Cost:




S C H E D U L E -18 - Notes forming part of the Accounts

1. Estimated amount of contracts remaining to be executed on

Capital Account and not provided fo r (net of advances &

letters of credits opened)

2. Contingent liabilities not provided for:

i . Outstanding Guarantees to Banks including

Letter of Credit opened with Banks fo r

capital payments

ii. Grid support charges claimed byA.PTransco - disputed by

th e Company

ill. Demand by EPDC of A.P Ltd., towards differential electrical

The Andhra

This Y

229

962

115





I. Reconciliation of opening and closing balances of Defined Benefit obli

(Rs. in la

Gratuity (Funded)

This year Previous year T

Defined Benefit obligation at beginning of the year 131.30 118.10

Interest Cost 10.59 9.53

Current Service Cost 9.80 10.22

Benefits paid (15.42) (5.68)

Actuarial loss / (gain) on obligation 5.38 (0.87)

Defined Benefit obligation at year en d 141.65 131.30




V. Principals Actuarial Assumptions:

Discount Rate

Salary Escalation Rate

The Andhra

Gratuity (Funded )

This year Previous year T

8.00%

7.00%

8.00%

7.00%

As per th e enterprise's accou nting policy actuarial gains and losses are r

during th e same year itself.

The above information is certified by the Actuary.




The Andhra

This Year

Rs. in lakhs % Rs. in

15. a) Consumpt ion of raw materials:

(including consumption during trial runs)

Imported Nil Nil

Indigenous 12082.58 100 180

b) Consum pt ion of stores dur ing

the year (charged to appropr iate

heads o f account) :

Imported 61.42 4 2

Indigenous 1561.15 96 16





BALANCE SHEET ABSTRACT AND

COMPANY'S GENERAL BUSINESS PROFILE

Registration Details:

Registration No.State Code

Balance Sheet Date

4635

0131st March, 2010

(Rs. Thousands)

II. Capital Raised during th e year:Public Issue Nil

Rights Issue Nil

Bonus Issue Nil

Private placement Nil

III. Position of Mobilisation and Deployment ofFunds:

Total Liabilities 3172539

CASH FLOW STA

THE YEAR 20

A) Cash Flow from

Operating Activities:

Profit/(Loss) for the year

before extraordinary items:

Adjustments for:

Depreciation

Interest paid

Interest received

Loss on sale of assets

Assets written off




AlPl

L\ THE ANDHRA PETROCHEMICALS LIMITRegd. Office: Venkatarayapuram, Tanuku - 534215

W.G.District, Andhra Pradesh

26 thAnnual General Meeting

Client ID*

DP. ID*

I /We

PROXY FORM

Fo

Member(s)of th e THE ANDHR A PETROCHEMICALS LIMITED hereby appoint

in th e district of or failing him



Permitted to Post "Postage pre-paid in cash"

Permit No.PMG/VJ/PWPP/CO./1/ dt. 13.8.2010/16.8.2010 to 8.9.2010Permitted to post at TANUKU H.P.O.

PRINT

BO

To

If undelivered, please return to :

Th e Andhra Petrochemicals Limited,

Venkatarayapuram,

Tanuku - 534 215,West Godavari Dist,

Andhra Pradesh.

Andhra Petrochemicals Ltd March 2010

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