Kesoram Industries Limited | Corporate Relations Website

The Cement Business's prospects for the current year are satisfactory. Barring unforeseen circumstances, EBIDTA is expected to improve further.

As is usual for a mature business, the Cement Business continued to win awards and accolades during the year. Two significant awards have been the National Award for Mines Safety and the Karnataka State Pollution Control Board's Environmental Excellence Award.

Rayon

Revenues from the Rayon Business during the year under review at Rs. 283 crore was marginally higher than that of the previous year. However, performance was impacted by a number of adverse factors including :

	significant softening of fibre prices in view of the sharp decline in cotton prices.
	high imports from China resulted in flattened demand and lower prices of viscose filament yarn ("VFY") produced domestically.
	high industry inventories of VFY. What was 11 days in March, 2011 went up to 28 days in March, 2012.

A difficult situation was aggravated further by margin pressure consequent upon steep rise in cost of inputs. Particularly severe was the sharp increase in the prices of coal and the consistent weakening of the Rupee against the US Dollar.

The Business signed a satisfactory wage settlement with its workmen during the year under review. The settlement has removed several working constraints faced by the manufacturing facility

The Business is working strongly to further widen its market reach during the current year, a measure that will considerably improve unit price realisations. This is being combined with significant improvement in quality standards to include fine denier material. It has also represented to the authorities for levying anti-dumping duty on cheap imports.

Spun Pipes and Heavy Chemicals

Kesoram Spun Pipes and Foundries and Hindusthan Heavy Chemicals facilities continued to be under suspension of work since 2nd May, 2008 and 8th December, 2010 respectively. Barricades put up by a section of workmen do not permit ingress/egress to or from these facilities. In view of this position, finished goods and other materials could not be accessed at either facility. This situation also explains the reference by the Auditors in their Report to the Company's inability to conduct physical verification of fixed assets and inventories at these locations.

CORPORATE SOCIAL RESPONSIBILITY

The Company is committed to the fulfillment of its social responsibility to society in general and those living in the vicinity of its facilities in particular. It regards this as a thrust activity area.