Your Directors have pleasure in presenting their 29^th Annual Report together with the Audited Accounts for the year ended 31^st December 2013.

FINANCIAL HIGHLIGHTS

The Company’s financial performance during the year is summarized below:

CURRENT OPERATIONS

There was a complete change in performance after the end of the financial year 2013. Excess capacity in the industry and flawing economy has dragged down the demand and profitability. Rampant expansion carried out by the Company during the past couple of years added to the problems and demand slow down, increase in the prices of raw materials, lower prices of finished goods, piling up of inventory and slow down in realization of book debts have made the Company suffer heavy losses. The plant of the company has also remained closed for over one month due to labour unrest. Your directors foresee a very heavy loss during the current financial year 2014.

DIVIDEND

Your Directors had provided for a dividend of Rs. 0.30 per equity share of Rs.5 each for the year ended 31^st December, 2013 while approving the audited accounts for the year 2013.

However in view of the changed scenario, your directors recommend to make appropriate decision for declaration of the dividend.

CAPITAL STRUCTURE

During the year under review, the share capital of your Company was changed / altered by further allotments as under:

Company has issued and allotted 5,30,00,000 equity shares of Rs. 5/- each at a premium of Rs. 5/- per equity share on conversion of 1,06,00,000 Warrants of Rs. 50/- each on 28.09.2013 to the Promoters’ Group of the Company and Non- promoter investors.

SUBSIDIARY COMPANIES

A statement in respect of each of the subsidiaries, giving the details of capital, reserves, total assets and liabilities, details of investment, turnover, profit before taxation, provision for taxation, profit after taxation and proposed dividend is attached to this report. The plant of Indo Korean Petrochem Ltd. (IKPL) the Company’s subsidiary located at South Korea was closed for refurbishing since February 2013. While the refurbishing is in progress, the complete change of scenario in the Korean market has made it difficult to operate the plant.

Annual accounts of subsidiary companies and the related detailed information will be made available to the holding and subsidiary company investors, seeking such information. Copies of the annual accounts of the subsidiary companies are available for inspection by any investor at the registered Office as well as the Administrative office of the company between 11.00 a.m. to 1.00 p.m. on all working days.

DIRECTORS

Mrs. P. B. Jain, Mr. B. L. Maheshwari, Mr. S. K. Bhoan, Mr. P. J. Shah & Mr. P. P. Vora have resigned as directors of the Company. Your directors place on record their sincere appreciation for the excellent services rendered by them during their tenure as directors of your Company.

Mr. R. K. Gupta was appointed as Additional Directors of the Company on 1^st March 2014 to hold office till the date of annual general meeting. His appointment as a director is proposed in the ensuing meeting.

CORPORATE GOVERNANCE

In line with guidelines recommended by Securities & Exchange Board of India (SEBI), adequate steps have been taken to ensure that all the mandatory provisions of Clause 49 of the Listing Agreement are complied with. A separate report on Corporate Governance is included as part of the Annual Report. The Auditors’ certificate confirming compliance of Corporate Governance is included in the said Corporate Governance report.

SAFETY, ENVIRONMENT & POLLUTION CONTROL MEASURES

During the year, no major accident took place in plant operations at Karanj. A safety committee has been formed consisting of group of persons from different departments which overlooks safe working conditions.

The company has provided Safety Helmets, Safety belts with full attachments, Gloves, Aprons, Shoes etc as personal protective equipments, Fire alarm system is attached to security office and various other measures are taken for the safety of employees. Safety training and awareness programes are being conducted throughout the year.

Your Company has complied with various emission standards and other environmental requirements as per pollution control norms.

LISTING

Equity Shares of your Company are listed on the Mumbai Stock Exchange and National Stock Exchange of India Ltd. Annual listing fees have been paid to the Stock Exchanges. GDRs are listed on Luxembourg Stock Exchange.

EMPLOYEES

There is no employee getting remuneration as prescribed under section 217(2A) of the Companies (Particulars of Employees) rules, 1975 as amended.

STATUTORY INFORMATION

Statutory information required under the Companies (Disclosure of Particulars in the Report of Board of Directors) Rules, 1988 applicable to the Company and forming part of this report are set out in Annexure to this report.

AUDITORS

M/s. N. M. Singapuri & Co. Chartered Accountants, Surat retire at the forthcoming Annual General Meeting, and being eligible, offer themselves for re-appointment. Your Directors recommend their re-appointment.

FORWARD-LOOKING STATEMENTS

This report contains forward looking statements. All statements that address expectations or projections about the future are forward-looking statements. Forward-looking statements are based on certain assumptions and expectations of future events. The Company cannot guarantee that these assumptions and expectations are accurate or will be realized. The Company’s actual results, performances or achievements could thus differ materially from those projected in any such forward-looking statements.

DIRECTORS RESPONSIBILITY STATEMENT

Directors confirm:

(i) that in the preparation of the annual accounts, the applicable accounting standards had been followed along with proper explanation relating to material departures;

(ii) that the directors had selected such accounting policies and applied them consistently and made judgments and estimates 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 and loss of the Company for that period;

(iii) that the directors had taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provision of the Companies Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

(iv) that the directors had prepared the annual accounts on a going concern basis.

(v) that the directors, in the case of a listed company, had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively.

(vi) that the directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.

ACKNOWLEDGEMENT

We wish to express our gratitude and appreciation for the valuable support and cooperation received from our customers, business associates, banks, financial institutions, shareholders, various statutory authorities and agencies of Central and State Governments. We place on record our appreciation of the contribution made by employees at all levels.

CONSERVATION OF ENERGY

FORM – B

B. Technology absorption adoption and Innovation:

Timely completion of the projects as well as meeting the budgetary requirements are the two critical areas where different techniques help to a great extent. Many innovative techniques have been developed and put to effective use in the past and the efforts to develop new techniques continue unabated.