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BOARD OF DIRECTORS

• Mr. Astorre Terruzzi, Chairman Emeritus (DIN 03173855) – Promoter, Non Executive

• Dr. Daniele Terruzzi, Chairman (DIN 02975023) – Promoter, Non Executive

• Ms. Paola Terruzzi, Vice Chairperson (DIN 02977596) – Promoter, Non Executive

• Mr. Massimo Ferracci (DIN 03173812) – Independent, Non Executive

• Mr. Ranganath Desai (DIN 05214436) – Executive Director - Finance

• Mr. Anand Gadkari (DIN 06873220) – Managing Director

• Mr. Massimiliano Altabella (DIN 03282553) – Independent, Non Executive

• Mr. Claudio Del Bianco (DIN 03349485) – Independent, Non Executive

• Mr. Roberto De Filippis Delfico (DIN 06873258) – Independent, Non Executive

STATUTORY AUDITORS & TAX CONSULTANTS

Suresh Surana & Associates LLP

Chartered Accountants

13th Floor, Bakhtawar,

229, Nariman Point,

Mumbai - 400 021, India.

REGISTERED OFFICE & HEADQUARTERS

104,105 & 106, Trade Centre,

"C" Wing, First Floor, North Main Road,

Koregaon Park, Pune - 411 001

REGISTRAR & SHARE TRANSFER AGENTS

Link Intime India Pvt. Ltd.

C-13, Pannalal Silk Mills Compound,

L. B. S. Marg, Bhandup (West),

Mumbai - 400 078, India.

50th Annual Report for the year ended 31st

December, 2013

C O N T E N T S

1. NOTICE ----------------------------------------------------------------------------------------------- 1

2. DIRECTORS' REPORT --------------------------------------------------------------------------- 17

3. MANAGEMENT DISCUSSION & ANALYSIS ------------------------------------------------ 21

4. REPORT ON CORPORATE GOVERNANCE ----------------------------------------------- 24

5. AUDITORS' REPORT ----------------------------------------------------------------------------- 35

6. BALANCE SHEET ---------------------------------------------------------------------------------- 38

7. PROFIT AND LOSS ACCOUNT ---------------------------------------------------------------- 39

8. CASH FLOW STATEMENT ----------------------------------------------------------------------- 40

9. NOTES TO THE FINANCIAL STATEMENT -------------------------------------------------- 41

1

N O T I C E

Notice is hereby given that the Fiftieth Annual General Meeting of Vulcan Engineers Limited will be held on Monday,

30th June, 2014 at 3.00 p.m. at Courtyard by Marriott, "Tulip", Pune City Centre, CTS No. 37 & 37/1, Next to JehangirHospital, Bund Garden Road, Pune - 411001 to transact the following business:

ORDINARY BUSINESS:

1. To receive, consider and adopt the audited Balance Sheet of the Company as at 31st December, 2013, the Profitand Loss Account for the year ended on that date together with the Reports of the Directors and Auditors thereon.

2. To appoint a Director in place of Dr. Daniele Terruzzi (holding DIN 02975023), who retires by rotation and being

eligible, offers himself for re-appointment.

3. To appoint a Director in place of Ms. Paola Terruzzi (holding DIN 02977596), who retires by rotation and beingeligible, offers herself for re-appointment.

4. To appoint M/s. Suresh Surana & Associates LLP, Chartered Accountants as Statutory Auditors of the Company

(ICAI Registration No. 121750W / W-100010) to hold office from the conclusion of this Annual General Meetinguntil the conclusion of next Annual General Meeting and to fix their remuneration.

SPECIAL BUSINESS:

5. To consider and if thought fit, to pass with or without modification(s), the following resolution as an Ordinary

Resolution:

"RESOLVED THAT pursuant to the provisions of Sections 149, 150, 152, 160 and any other applicable provisions

of the Companies Act, 2013 and the rules made thereunder (including any statutory modification(s) or re-enactmentthereof for the time being in force) read with Schedule IV to the Companies Act, 2013, Mr. Massimo Ferracci

(holding DIN 03173812), Director of the Company who retires by rotation at the Annual General Meeting and inrespect of whom the Company has received a notice in writing from a member proposing his candidature for the

office of Director, be and is hereby appointed as an Independent Director of the Company to hold office for fiveconsecutive years from the conclusion of this Annual General Meeting, not liable to retire by rotation."

6. To consider and if thought fit, to pass with or without modification(s), the following resolution as an Ordinary

Resolution:

"RESOLVED THAT pursuant to the provisions of Sections 149, 150, 152, 160 and any other applicable provisionsof the Companies Act, 2013 and the rules made thereunder (including any statutory modification(s) or re-enactment

thereof for the time being in force) read with Schedule IV to the Companies Act, 2013, Mr. Claudio Del Bianco(holding DIN 03349485), Director of the Company who retires by rotation at the Annual General Meeting and in

respect of whom the Company has received a notice in writing from a member proposing his candidature for theoffice of Director, be and is hereby appointed as an Independent Director of the Company to hold office for five

consecutive years from the conclusion of this Annual General Meeting, not liable to retire by rotation."

7. To consider and if thought fit, to pass with or without modification(s), the following resolution as an OrdinaryResolution:

"RESOLVED THAT pursuant to the provisions of Sections 149, 150, 152, 160 and any other applicable provisions

of the Companies Act, 2013 and the rules made thereunder (including any statutory modification(s) or re-enactmentthereof for the time being in force) read with Schedule IV to the Companies Act, 2013, Mr. Massimiliano Altabella

(holding DIN 03282553), Director of the Company whose period of office is liable to determination by retirement ofdirectors by rotation and in respect of whom the Company has received a notice in writing from a member

proposing his candidature for the office of Director, be and is hereby appointed as an Independent Director of theCompany to hold office for five consecutive years from the conclusion of this Annual General Meeting, not liable

to retire by rotation."


"RESOLVED THAT pursuant to the provisions of Section 161(1) and all other applicable provisions, if any, of theCompanies Act, 2013 (including any rules and notifications thereto for the time being in force), Mr. Roberto De

Corporate Identification Number: L12801PN1963PLC149701

Registered Office: 104,105 & 106, Trade Centre, "C" Wing, First Floor, North Main Road, Koregaon Park, Pune - 411 001

E-mail : [email protected] | Website: www.vulcanengineers.com

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50TH ANNUAL REPORT FOR THE YEAR ENDED 31ST DECEMBER, 2013

Filippis Delfico (holding DIN 06873258), who pursuant to Article 85 of the Articles of Association of the Company

was appointed as an Additional Director designated as Independent Director of the Company on 16th May, 2014and who holds office upto the date of this Annual General Meeting and being eligible offers himself for appointment

as an Independent Director pursuant to the provisions of sections 149, 150, 152, 160 and other applicable provisionsof the Companies Act, 2013 and the rules made thereunder (including any statutory modification(s) or re-enactment

thereof for the time being in force) read with Schedule IV to the Companies Act, 2013, for a period of fiveconsecutive years from the conclusion of this Annual General Meeting, and in respect of whom the Company has

received a Notice in writing from a member, signifying his intention to propose the candidature of Mr. Roberto DeFilippis Delfico, for the office of Director of the Company, be and is hereby appointed as a Director of the Company,

not liable to retire by rotation."

9. To consider and if thought fit, to pass with or without modification(s), the following resolution as a Special Resolution:

"RESOLVED THAT pursuant to the provisions of sections 196, 197, 203 and any other applicable provisions ofthe Companies Act, 2013 and the rules made thereunder (including any statutory modification(s) or re-enactment

thereof for the time being in force), read with Schedule V to the Companies Act, 2013 approval of the Company beand is hereby accorded for the reappointment of Mr. Ranganath Desai (DIN 05214436) as whole time director to be

designated as Executive Director - Finance, for a period commencing from 21st February, 2014 to 4th July, 2014on the terms and conditions and remuneration as contained in the agreement to be entered into between the

Company and Mr. Ranganath Desai, a draft of which is placed before the meeting and for the purpose of identification,initialed by the Chairman with liberty to the Directors/Remuneration Committee to alter and vary the terms and

conditions of the said reappointment in such manner as may be agreed to by the Company and Mr. RanganathDesai."

"RESOLVED FURTHER THAT the Board of Directors of the Company be and are hereby authorised to do all such

acts, deeds and things as may be necessary or expedient to give effect to the above resolution."


"RESOLVED THAT pursuant to the provisions of Section 161(1) of the Companies Act, 2013 and all other applicable

provisions, if any, of the Companies Act, 2013 (including any rules and notifications thereto for the time being inforce), Mr. Anand Gadkari (holding DIN 06873220), who pursuant to Article 85 of the Articles of Association of the

Company was appointed as an Additional Director of the Company on 16th May, 2014 and who holds office toupto the date of this Annual General Meeting and in respect of whom the Company has received a notice in writing

from a member proposing his candidature for the office of the Director be and is hereby appointed as a Director ofthe Company whose period of office, shall be liable to determination by retirement of directors by rotation."


"RESOLVED THAT pursuant to the provisions of sections 196, 197, 203 and any other applicable provisions ofthe Companies Act, 2013 and the rules made thereunder (including any statutory modification(s) or re-enactment

thereof for the time being in force), read with Schedule V to the Companies Act, 2013 and read with the Companies(Appointment and Remuneration of Managerial Personnel) Rules 2014, approval of the Company be and is hereby

accorded for the appointment of Mr. Anand Gadkari (holding DIN 06873220) as Managing Director of the Companyfor a period of 3 (three) years commencing from 16th May, 2014 to 15th May, 2017 on the terms and conditions

and remuneration as contained in the agreement to be entered into between the Company and Mr. Anand Gadkari,a draft of which is placed before the meeting and initialed by the Chairman for purpose of identification which

agreement is hereby specifically approved, with liberty to the Board of Directors of the Company (hereinafterreferred to as "the Board" which term shall be deemed to include any/committee of the Board) to alter and vary the

terms and conditions of the said appointment in such manner as may be agreed to by the Company and Mr. AnandGadkari."

"RESOLVED FURTHER THAT during the tenure of Mr. Anand Gadkari as Managing Director, he shall be a Key

Managerial Personnel (KMP) of the Company, in terms of Section 203(1)(i) of the Companies Act, 2013."

"RESOLVED FURTHER THAT the Board of Directors of the Company be and are hereby authorised to do all suchacts, deeds and things as may be necessary or expedient to give effect to the above resolution."




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"RESOLVED THAT in supersession of the Ordinary Resolution adopted at the Meeting held for announcement of

the result of postal ballot on 16th December, 2010 and pursuant to Section 180(1)(c) and any other applicableprovisions of the Companies Act, 2013 and the rules made thereunder (including any statutory modification(s) or

re-enactment thereof for the time being in force) and the Articles of Association of the Company, the consent ofthe members of the Company be and is hereby accorded to the Board of Directors for borrowing from time to time,

at their discretion, for the purpose of the business of the Company, any sum or sums of money which together withmoneys already borrowed by the Company (apart from the temporary loans obtained or to be obtained from the

Company's bankers in the ordinary course of business) may exceed at any time, the aggregate of the Paid-upcapital of the Company and its free reserves, that is to say reserves not set apart for any specific purpose,

provided that the total amount so borrowed by the Board shall not at any time exceed the limit of Rs. 50 Crores(Rupees Fifty Crores only) and that the Board of Directors be and are hereby empowered and authorized to arrange

or fix the terms and conditions of all such monies to be borrowed from time to time as to interest, repayment,security or otherwise as it may think fit."

"RESOLVED FURTHER THAT for the purpose of giving effect to this resolution, the Board and/or its duly constituted

Committee be and are hereby authorised to finalize, settle and execute such documents/deeds/writings/papers/agreements as may be required and do all such acts, deeds, matters and things, as it may in its absolute

discretion deem necessary, proper or desirable and to settle any question, difficulty or doubt that may arise to giveeffect to this resolution and its decision shall be final and binding."

By Order of the Board

Place : Italy Dr. Daniele TerruzziDated : 16th May, 2014 Chairman

Registered Office:104,105 & 106, Trade Centre, "C" Wing,

First Floor, North Main Road, Koregaon Park,Pune - 411 001




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NOTES

An Explanatory Statement pursuant to Section 102(2) of the Companies Act, 2013, relating to the Special Businessin respect of item no. 5 to 12 mentioned above is annexed hereto.

Every member entitled to attend and vote at the meeting is entitled to appoint a proxy to attend and voteinstead of himself/herself and a proxy need not be a member. The instrument of proxy in order to beeffective must be deposited at the Registered Office of the Company not less than 48 hours before thecommencement of the meeting.

A person can act as proxy on behalf of members not exceeding fifty (50) and holding in the aggregate not more thanten percent of the total share capital of the Company carrying voting rights.

Provided that a member holding more than ten percent of the total share capital of the Company carrying votingrights may appoint a single person as proxy and such person shall not act as proxy for any other person orshareholder.

The details of the Directors seeking appointment/re-appointment at the forthcoming Annual General Meeting asstipulated under Clause 49 of the Listing Agreement with the Bombay Stock Exchange are also annexed.

The Register of Members and Share Transfer Books of the Company will remain closed from 23rd June, 2014 to30th June, 2014 (both days inclusive).

Link Intime India Private Limited, C-13, Pannalal Silk Mills Compound, L.B.S. Marg, Bhandup (West), Mumbai -400 078 are the Registrars and Share Transfer Agents of the Company to handle share transfers, both in physicaland electronic segments and other share related matters. Shareholders are requested to correspond with theRegistrars at the above address.

Shareholders are requested to promptly notify any change in their addresses or bank account particulars:

a) To the Registrar and Share Transfer Agents of the Company for the shares held in physical form; and

b) Directly to the respective Depository Participants with whom they are maintaining their demat accounts andnot to the Company/Registrar and Share Transfer Agents, for the shares held in electronic form.

Non-Resident Indian Members are requested to inform M/s. Link Intime India Private Limited, immediately of:

(i) Change of their residential status on return to India for permanent settlement.

(ii) Particulars of their bank account maintained in India with complete name, branch, account type, accountnumber and address of the bank with pin code number, if not furnished earlier.

In all correspondences with the Company, members holding shares in physical form are requested to quote theirFolio numbers and those holding shares in electronic form are requested to quote their DP ID number and Client IDnumber.

Pursuant to the provisions of Section 124(5) of the Companies Act, 2013 (erstwhile Section 205A(5) of the CompaniesAct, 1956), all unclaimed dividends upto the financial year ended 31st March, 1994 have been transferred to theGeneral Revenue Account of the Central Government. Shareholders who have not encashed their dividend warrantsupto the said period are requested to claim the amount from the Registrar of Companies, Maharashtra. Pursuant tointroduction of Section 205C by the Companies (Amendment) Act, 2000, the amount of dividend unpaid or unclaimedfor a period of seven years from the date of payment is required to be transferred to the Investor Education andProtection Fund (IEPF) constituted by the Central Government. Accordingly, dividends for the financial yearsended 31st March, 1995, 31st March, 1996 and 31st March, 1997 which remained unclaimed for 7 years from thedate of declaration have been transferred to IEPF. Therefore, no claim shall lie against the Company or theInvestor Education and Protection Fund after transfer of the dividends to IEPF.

Corporate members intending to send their authorised representatives to attend the meeting are requested to sendto the Company a certified copy of the Board Resolution authorizing their representative to attend and vote on theirbehalf at the meeting.

The Securities and Exchange Board of India (SEBI) has mandated the submission of Permanent Account Number(PAN) by every participant in securities market. Members holding shares in electronic form are therefore, requested




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to submit the PAN to their Depository Participants with whom they are maintaining their demat accounts. Membersholding shares in physical form can submit their PAN details to the Company/Registrar & Share Transfer Agenti.e. Link Intime India Private Limited.

Members holding shares in single name and physical form are advised to make nomination in respect of theirshareholding in the Company.

Members who hold shares in physical form in multiple folios in identical names are requested to send the sharecertificates to Link Intime India Private Limited immediately to enable consolidation of their holdings into one folio.

Members/Proxy Holders are requested to produce at the entrance of hall, attendance slips duly completed andsigned, in accordance with the specimen signature registered with the Company for admission to the Meeting Hall.

Members desirous of obtaining any information concerning the accounts for the year ended 31st December, 2013are requested to write to the Company Secretary at the Registered office of the Company atleast 10 days beforethe date of the meeting, to facilitate clarifications to the shareholders at the meeting.

Electronic copy of the Annual Report for 2013 is being sent to all the members whose email IDs are registered withthe Company/Depository Participants(s) for communication purposes unless any member has requested for ahard copy of the same. For members who have not registered their email address, physical copies of the AnnualReport for 2013 is being sent in the permitted mode.

Electronic copy of the Notice of the 50th Annual General Meeting of the Company inter alia indicating the processand manner of e-voting along with Attendance Slip and Proxy Form is being sent to all the members whose emailIDs are registered with the Company/Depository Participants(s) for communication purposes unless any memberhas requested for a hard copy of the same. For members who have not registered their email address, physicalcopies of the Notice of the 50th Annual General Meeting of the Company inter alia indicating the process andmanner of e-voting along with Attendance Slip and Proxy Form is being sent in the permitted mode.

Members may also note that the Notice of the 50th Annual General Meeting and the Annual Report for 2013 willalso be available on the Company's website www.vulcanengineers.com for their download. The physical copies ofthe aforesaid documents will also be available at the Company's Registered Office in Pune for inspection duringnormal business hours on working days. Even after registering for e-communication, members are entitled toreceive such communication in physical form, upon making a request for the same, by post free of cost. For anycommunication, the shareholders may also send requests to the Company's investor email id:[email protected]

Voting through electronic means

I. In compliance with provisions of Section 108 of the Companies Act, 2013 and Rule 20 of the Companies(Management and Administration) Rules, 2014, the Company is pleased to provide members facility to exercisetheir right to vote at the 50th Annual General Meeting (AGM) by electronic means and the business may betransacted through e-Voting Services provided by National Securities Depository Limited (NSDL):

The instructions for e-voting are as under:

A. In case a Member receives an email from NSDL [for members whose email IDs are registered with theCompany/Depository Participants(s)]:

(i) Open email and open PDF file viz; "Vulcan Engineers e-Voting.pdf" with your Client ID (in case you areholding shares in demat mode) or Folio No. (in case you are holding shares in physical mode) as password,which contains your "User ID" and "Password/PIN for e-voting". Please note that the password is aninitial password.

(ii) Launch internet browser by typing the following URL: https://www.evoting.nsdl.com/

(iii) Click on Shareholder - Login

(iv) Put User ID and password as initial password/PIN noted in step (i) above. Click Login.

(v) Password change menu appears. Change the password/PIN with new password of your choice withminimum 8 digits/characters or combination thereof. Note new password. It is strongly recommended notto share your password with any other person and take utmost care to keep your password confidential.




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(vi) Home page of e-voting opens. Click on e-Voting: Active Voting Cycles.

(vii) Select "EVEN" of Vulcan Engineers Limited. Members can cast their vote online from 23rd June, 2014(9:00 am) till 25th June, 2014 (6:00 pm).

Note : e-Voting shall not be allowed beyond said time.

(viii) Now you are ready for e-voting as Cast Vote page opens.

(ix) Cast your vote by selecting appropriate option and click on "Submit" and also "Confirm" when prompted.

(x) Upon confirmation, the message "Vote cast successfully" will be displayed.

(xi) Once you have voted on the resolution, you will not be allowed to modify your vote.

(xii) Institutional shareholders (i.e. other than individuals, HUF, NRI etc.) are required to send scanned copy(PDF/JPG Format) of the relevant Board Resolution/ Authority letter etc. together with attested specimensignature of the duly authorized signatory(ies) who are authorized to vote, to the Scrutinizer through e-mail to [email protected] with a copy marked to [email protected]

B. In case a Member receives physical copy of the Notice of AGM [for members whose email IDs are not registeredwith the Company/Depository Participants(s) or requesting physical copy] :

I. Initial password is provided as below/at the bottom of the Attendance Slip for the AGM :

EVEN (E Voting Event Number) USER ID PASSWORD/PIN

Please follow all steps from Sl. No. (ii) to Sl. No. (xii) above, to cast vote.

II. In case of any queries, you may refer the Frequently Asked Questions (FAQs) for Shareholders and e-votinguser manual for Shareholders available at the Downloads section of www.evoting.nsdl.com

III. If you are already registered with NSDL for e-voting then you can use your existing user ID and password/PINfor casting your vote.

IV. You can also update your mobile number and e-mail id in the user profile details of the folio which may be usedfor sending future communication(s).

V. The e-voting period commences on 23rd June, 2014 (9:00 am) and ends on 25th June, 2014 (6:00 pm). Duringthis period shareholders' of the Company, holding shares either in physical form or in dematerialized form, ason the cut-off date (record date) of 17th May, 2014, may cast their vote electronically. The e-voting moduleshall be disabled by NSDL for voting thereafter. Once the vote on a resolution is cast by the shareholder, theshareholder shall not be allowed to change it subsequently.

VI. The voting rights of shareholders shall be in proportion to their shares of the paid up equity share capital of theCompany as on the cut-off date (record date) of 17th May, 2014 .

VII. Ms. Ratan Kapadia (Membership No. 1395) and Proprietor of M/s. Ratan Kapadia & Associates, PracticingCompany Secretaries has been appointed as the Scrutinizer to scrutinize the e-voting process in a fair andtransparent manner.

VIII.The Scrutinizer shall within a period not exceeding three(3) working days from the conclusion of the e-votingperiod unblock the votes in the presence of atleast two(2) witnesses not in the employment of the Companyand make a Scrutinizer's Report of the votes cast in favour or against, if any, forthwith to the Chairman of theCompany.

IX. The Results shall be declared on the AGM of the Company. The Results declared alongwith the Scrutinizer'sReport shall be placed on the Company's website www.vulcanengineers.com and on the website of NSDLwithin two(2) days of passing of the resolutions at the AGM of the Company and communicated to the BSELimited.

All documents referred to in the accompanying Notice and the Explanatory Statement shall be open for inspectionat the Registered Office of the Company during normal business hours (9.30 a.m. to 6.30 p.m.) on all working daysexcept Saturdays, upto and including the date of the Annual General Meeting of the Company.




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EXPLANATORY STATEMENTS PURSUANT TO SECTION 102 OF THE COMPANIES ACT, 2013 IN

RESPECT OF ITEM NO. 5 TO 12:

The following Explanatory Statements sets out all material facts relating to the Special Business mentioned in the accompanying notice.

ITEM NO. 5

Mr. Massimo Ferracci is a Non-Executive Independent Director of the Company. He joined the Board of Directors of the Company in February,2010. Mr. Massimo Ferracci is Chairman of the Audit Committee and a member of the Remuneration Committee, of the Board of Directors ofthe Company.

Mr. Massimo Ferracci retires by rotation at the ensuing Annual General Meeting, under the erstwhile applicable provisions of the CompaniesAct, 1956. In terms of Section 149 and any other applicable provisions of the Companies Act, 2013, Mr. Massimo Ferracci being eligible andoffering himself for appointment, is proposed to be appointed as an Independent Director for five consecutive years from the conclusion of thisAnnual General Meeting. A notice has been received from a member, proposing Mr. Massimo Ferracci as a candidate for the office of Directorof the Company.

In the opinion of the Board, Mr. Massimo Ferracci fulfils the conditions specified in the Companies Act, 2013 and rules made thereunder for hisappointment as an Independent Director of the Company and is Independent of the Management. Copy of the draft letter for appointment of Mr.Massimo Ferracci as an Independent Director setting out the terms and conditions would be available for inspection without any fee by themembers at the Registered Office of the Company during normal business hours on any working day, excluding Saturday.

The Board considers that his continued association would be of immense benefit to the Company and it is desirable to continue to avail servicesof Mr. Massimo Ferracci as an Independent Director. Accordingly, the Board recommends the resolution in relation to appointment of Mr.Massimo Ferracci as an Independent Director, not liable to retire by rotation, for the approval by the shareholders of the Company.

Except Mr. Massimo Ferracci, being an appointee, none of the Directors and Key Managerial Personnel of the Company and their relatives areconcerned or interested, financial or otherwise, in the resolution set out at Item No. 5.

ITEM NO. 6

Mr. Claudio Del Bianco is a Non-Executive Independent Director of the Company. He joined the Board of Directors of the Company in February,2010.

Mr. Claudio Del Bianco retires by rotation at the ensuing Annual General Meeting, under the erstwhile applicable provisions of the CompaniesAct, 1956. In terms of Section 149 and any other applicable provisions of the Companies Act, 2013, Mr. Claudio Del Bianco being eligible andoffering himself for appointment, is proposed to be appointed as an Independent Director for five consecutive years from the conclusion of thisAnnual General Meeting. A notice has been received from a member proposing Mr. Claudio Del Bianco as a candidate for the office of Directorof the Company.

In the opinion of the Board, Mr. Claudio Del Bianco fulfils the conditions specified in the Companies Act, 2013 and rules made thereunder for hisappointment as an Independent Director of the Company and is Independent of the Management. Copy of the draft letter for appointment of Mr.Claudio Del Bianco as an Independent Director setting out the terms and conditions would be available for inspection without any fee by themembers at the Registered Office of the Company during normal business hours on any working day, excluding Saturday.

The Board considers that his continued association would be of immense benefit to the Company and it is desirable to continue to avail servicesof Mr. Claudio Del Bianco as an Independent Director. Accordingly, the Board recommends the resolution in relation to appointment of Mr.Claudio Del Bianco as an Independent Director, not liable to retire by rotation, for the approval by the shareholders of the Company.

Except Mr. Claudio Del Bianco, being an appointee, none of the Directors and Key Managerial Personnel of the Company and their relatives areconcerned or interested, financial or otherwise, in the resolution set out at Item No. 6.

ITEM NO. 7

Mr. Massimiliano Altabella is a Non-Executive Independent Director of the Company. He joined the Board of Directors of the Company in July,2010. He is Member of Audit and Remuneration Committee, of the Board of Directors of the Company.

Mr. Massimiliano Altabella is a Director whose period of office is liable to determination by retirement of directors by rotation, under the erstwhileapplicable provisions of the Companies Act, 1956. In terms of Section 149 and any other applicable provisions of the Companies Act, 2013, Mr.Massimiliano Altabella being eligible and offering himself for appointment, is proposed to be appointed as an Independent Director for fiveconsecutive years from the conclusion of this Annual General Meeting. A notice has been received from a member proposing Mr. MassimilianoAltabella as a candidate for the office of Director of the Company.

In the opinion of the Board, Mr. Massimiliano Altabella fulfils the conditions specified in the Companies Act, 2013 and rules made thereunder forhis appointment as an Independent Director of the Company and is Independent of the Management. Copy of the draft letter for appointmentof Mr. Massimiliano Altabella as an Independent Director setting out the terms and conditions would be available for inspection without any feeby the members at the Registered Office of the Company during normal business hours on any working day, excluding Saturday.

The Board considers that his continued association would be of immense benefit to the Company and it is desirable to continue to avail servicesof Mr. Massimiliano Altabella as an Independent Director. Accordingly, the Board recommends the resolution in relation to appointment of Mr.Massimiliano Altabella as an Independent Director, not liable to retire by rotation, for the approval by the shareholders of the Company.




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Except Mr. Massimiliano Altabella, being an appointee, none of the Directors and Key Managerial Personnel of the Company and their relativesare concerned or interested, financial or otherwise, in the resolution set out at Item No. 7.

ITEM NO. 8

Mr. Roberto De Filippis Delfico was appointed as an Additional Director designated as an Independent Director with effect from 16th May, 2014.Pursuant to provisions of Section 161(1) of the Companies Act, 2013, Mr. Roberto De Filippis Delfico would hold office as a Director upto thedate of this 50th Annual General Meeting.

He has been appointed as member of Audit and Nomination and Remuneration Committee, of the Board of Directors.

In the opinion of the Board, Mr. Roberto De Filippis Delfico fulfils the conditions specified in the Companies Act, 2013 and rules made thereunderfor his appointment as an Independent Director of the Company and is Independent of the Management. Copy of the draft letter for appointmentof Mr. Roberto De Filippis Delfico as an Independent Director setting out the terms and conditions would be available for inspection without anyfee by the members at the Registered Office of the Company during normal business hours on any working day, excluding Saturday.

A notice has been received from a member proposing Mr. Roberto De Filippis Delfico as a candidate for the office of Director of the Company.Mr. Roberto De Filippis Delfico has consented to continue as a Director of the Company, if appointed.

The Board considers that his continued association would be of immense benefit to the Company and it is desirable to continue to availservices of Mr. Roberto De Filippis Delfico as an Independent Director. Accordingly, the Board recommends the resolution in relation toappointment of Mr. Roberto De Filippis Delfico as an Independent Director, not liable to retire by rotation, for the approval by the shareholdersof the Company.

The Board of Directors recommends passing of the Ordinary Resolution at Item No. 8 of the Notice for his appointment as an IndependentDirector for a period of five consecutive years from the conclusion of this Annual General Meeting, not liable to retire by rotation.

Except Mr. Roberto De Filippis Delfico, being an appointee, none of the Directors and Key Managerial Personnel of the Company and theirrelatives is concerned or interested, financial or otherwise, in the resolution set out at Item No. 8.

ITEM NO. 9

The tenure of Mr. Ranganath Desai, Executive Director - Finance expired on 20th February, 2014. The Board of Directors at their meeting heldon 28th February, 2014 had re-appointed Mr. Ranganath Desai as Executive Director - Finance for a period of one year with effect from 21stFebruary, 2014 to 20th February, 2015 on the remuneration recommended by the Remuneration Committee of Directors at their meeting heldon the same day, his re-appointment and the remuneration, is subject to the approval of the shareholders under provisions of Section 197 readalongwith Schedule V of the Companies Act, 2013.

Mr. Ranganath Desai is 58 years old and has graduated in Commerce with Advanced Accountancy and Auditing as his major subjects. He has36 years of work experience. He joined Vulcan Engineers Limited in 1982 and has been working with the Company for 32 years in variouscapacities. He has immense knowledge and experience in the field of Finance, Accounts, Taxation, Administration, Human Resources andIndian Laws.

However, Mr. Ranganath Desai had tendered his resignation as an Executive Director - Finance with effect from 4th July, 2014. Accordingly,the Board recommends the resolution in relation to reappointment and remuneration payable to Mr. Ranganath Desai as Executive Director -Finance for the period 21st February 2014 to 4th July 2014, for approval of the shareholders.

The proposed remuneration and conditions of the appointment of whole time Director is given below:

Total Salary of Rs. 2,00,000/- per month inclusive of perquisites, allowances, benefits, facilities and amenities (collectively called 'perquisites')such as medical reimbursement, leave travel assistance / hospitalization and accident insurance and other perquisites as per policy / rules ofthe Company in force or as may be approved by the Board from time to time.

In addition to the above, the appointee shall also be entitled to the following benefits as the policy/ rules of the Company which may be in forcefrom time to time:

1. Company maintained car with driver to be used for the Companies business or cash equivalent thereof.

2. Tele Communication facility at residence.

3. Payment of gratuity and other retiral benefits.

4. Leave encashment.

The aggregate remuneration to Mr. Ranganath Desai as Executive Director - Finance in any financial year shall not exceed the limitsprescribed from time to time under Sections 196, 197 and other applicable provisions of the Companies Act, 2013 read alongwith Schedule Vto the said Act, unless approved by the Central Government.

Mr. Ranganath Desai is neither a Director on the Board nor holds committee membership of any other public company. He holds 200 equityshares of the Company as on the date of this Notice.

Except Mr. Ranganath Desai, being an appointee, none of the Directors and Key Managerial Personnel of the Company and their relatives isconcerned or interested, financial or otherwise, in the resolution set out at Item No. 9.

As per Sections 196, 197 and other applicable provisions of the Companies Act, 2013 read alongwith Schedule V to the said Act, members'




Phone no. +91 020 6645 0800 | Fax No : +91 020 6645 0801

9

approval by way of Special Resolution is required.

The Board of Directors recommends passing of the Special Resolution at Item No. 9 of the Notice.

The Notice read with the Explanatory Statement shall be considered as an abstract of the terms of reappointment and payment of remunerationto Mr. Ranganath Desai as Executive Director - Finance and a Memorandum as to the nature of the concern or interest of the Director asrequired under Section 184 of the Companies Act, 2013.

The information required under Clause (iv) of proviso to paragraph 1(B) of Section II of Part II of Schedule V of the Companies Act, 2013 isprovided below.

INFORMATION REQUIRED UNDER CLAUSE (IV) OF PROVISO TO PARAGRAPH 1(B) OF SECTION II OF PART II OF SCHEDULE VOF THE COMPANIES ACT, 2013

I. General Information




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Sr.

No.Particulars General Information

The Company is mainly engaged in the business of reheat and heattreatment furnaces and lime plants for the steel industry. The Company isalso authorised by its memorandum to have the business of manufacturersand dealers in all kinds of electrical, mechanical, metallurgical, chemical,electronic, construction and all other types of machinery particularly toengage in and carry out the business of planning, design, manufacturing,constructing and erecting all types of equipments, material handling plantsfor all types of industry and to act as Consultants and Advisors in the matteraforesaid.

The Company is in the business of design, engineering, supply, constructionand erection of industrial plants (mainly reheat and heat treatment furnacesand lime calcinations plants). Components and fabricated items of supplyare being outsourced.

1. Nature of Industry

2. Date or expected date of Commencementof Commercial Production

Not applicable

3. In the case of new Companies, expecteddate of commencement of activities asper project approved by FinancialInstitutions appearing in the prospectus.

Not applicable

4. Financial Performance Loss for the year 2013 : Rs. 5,00,92,350/-

5. Export Sales & net foreign exchange

earnings.Rs. 9,37,41,054/-

6. Foreign Investments or Collaborations,if any

The Company has no foreign investments. However, Terruzzi Fercalx SpA,a Company incorporated in Italy holds 57.69% of the total issued and paid-up share capital of the Company and Societa Italiana Per Le Imprese AllEstero - SIMEST SpA, a government financial institution based in Italyholds 13.79% of the total issued and paid-up share capital of the Company.

II. Information about the appointee, Mr. Ranganath Desai

Sr.

No.Details of Mr. Ranganath Desai

1. Qualification Graduated in Commerce with Advanced Accountancy and Auditing as hismajor subjects

2. Age 58 years

3. Experience He has 36 years of work experience. He joined Vulcan Engineers Limited in

1982 and has been working with the Company for 32 years in various capacities.He has immense knowledge and experience in the field of Finance, Accounts,Taxation, Administration, Human Resources and Indian Laws.

10





Phone no. +91 020 6645 0800 | Fax No : +91 020 6645 0801

Sr.

No. Details of Mr. Ranganath Desai

7. Remuneration Proposed Rs. 24,00,000/- p.a.

8 Comparative remuneration profile withrespect to industry, size of the Company,profile of the position and person (in case

of expatriates the relevant details wouldbe w.e.f. the country of his origin)

From Rs. 50,00,000/-p.a. to Rs. 70,00,000/- p.a.

9. Pecuniary relationship directly orindirectly with the Company orrelationship with the managerial

personnel, if any.

Except his remuneration as whole time director, Mr. Desai has no otherpecuniary relationship with the Company or any other managerialpersonnel.

4. Past Remuneration Rs. 22,20,000/- p.a.

5. Recognition or Rewards No external recognition or rewards.

6. Job Profile & Suitability Overall incharge of finance and accounts of the Company, under thesupervision and control of the Board. Mr. Ranganath Desai has the financialand managerial skills and experience required for this job. Moreover, Mr.

Ranganath Desai has been closely associated with the Company in variouscapacities for the last 32 years.

III. Other Information

Sr.

No. Particulars

1 Reasons for loss or inadequate profits Due to the reasons beyond its control the completion of the two publicsector orders being executed by the Company has been delayed whichhas impacted the financial results of the Company. Moreover, there hasbeen slowdown in the economic growth of the country particularly in thelast year which has adversely affected the steel industry which forms themajor customer base of the Company. This togather with the increasedcompetition from both domestic and foreign players has resulted in thepaucity of fresh orders and lower margins.

2 Steps taken or proposed to be taken The Management of the Company was taken over by Terruzzi FercalxSpA, Italy in the year 2010. Terruzzi Fercalx SpA, who are the global leadersin lime plants have also invested in the equity capital of the Company. TheCompany now has access to greater financial resources and markets,both of which are required for the future growth of the Company. Efforts arealso being made to improve the order load, both in the domestic andexport markets and to diversify the products and services offered by theCompany. Your Company is also targeting to complete the existing twopublic sector projects by setting realistic deadlines. In order to increase thesales and revenue of the Company, the Management has re-structured theSales Department for effective results. During the last year, the sales teamhas continued aggressive scouting in the markets, to re-enter and re-establish the presence of Vulcan Engineers Limited among the customers,and the results of which are expected in the near future. The Company hasaccess to the latest technology and systems as well as markets in China,Europe, South America, Africa and other parts of the world, where thePromoters, Terruzzi Fercalx SpA have a presence and has sub-contractedpart of the orders received by them in Zambia & Mongolia to the Company.However, sourcing from India by the Terruzzi Fercalx Group is expected togrow in the future. The Company with the help of Terruzzi Fercalx Grouphas expanded its geographical footprint into the international & domesticmarket and has taken a number of initiatives which are expected to yield

11

Mr. Ranganath Desai has been reappointed on the following terms :

Remuneration : Rs. 2,00,000/- p.m.

Period commencing from 21st February, 2014 to 4th July, 2014

General Terms:

Mr. Ranganath Desai will be a member of the Board of Directors and shall be liable to retire by rotation. Mr. Ranganath Desaiwill not be entitled to sitting fees.

Subject to the superintendence, control and direction of the Board, provisions of Section 179 and 180 of the Companies Act,2013, and the Articles of Association of the Company, Mr. Ranganath Desai will be overall in charge of the finance and accountsof the Company.

Notwithstanding anything contained herein, Mr. Ranganath Desai shall cease to hold his office of Executive Director - Finance,if he ceases to hold his office as Director of the Company for any reason.

ITEM NO. 10 & 11

Mr. Anand Gadkari was appointed as an Additional Director in terms of section 161(1) of the Companies Act 2013 by the Boardof Directors at their meeting held on 16th May, 2014 to hold office upto the date of the this Annual General Meeting. Further theBoard of Directors appointed Mr. Anand Gadkari as Managing Director and Key Managerial Personnel (KMP), for a period of3 years with effect from 16th May, 2014 on the remuneration recommended by the Nomination and Remuneration Committeeof Directors at the meeting held on the same day. His appointment and remuneration is subject to the approval of shareholdersunder the provisions of Section 197 read with Schedule V of the Companies Act, 2013. A notice has been received from amember proposing him as a candidate for the office of Director of the Company.

Mr. Anand Gadkari is Chief Executive Officer of the Company, since 14th January, 2013. It is advisable for the Company toappoint him as Managing Director of the Company. Mr. Anand Gadkari is 38 years old and has completed his Bachelor inMechanical Engineering. He also holds degree in Masters of Business Administration. He has strong functional experience of15 years in Industrial Marketing catering to clients in various Segments like Chemical, Fertilizer, Automobile, Heavy Engineering,Engineering Consultants, OEMs, Forging industries and related industries. He is good team player with good interpersonaland leadership skills.

The proposed remuneration and conditions of the appointment of Managing Director is given below:

Total Salary of Rs. 2,00,000/- per month inclusive of perquisites, allowances, benefits, facilities and amenities (collectivelycalled 'perquisites') such as medical reimbursement, leave travel assistance / hospitalization and accident insurance andother perquisites as per policy / rules of the Company in force or as may be approved by the Board from time to time.

In addition to the above, the appointee shall also be entitled to the following benefits as the policy/ rules of the Company whichmay be in force from time to time:

1. Company maintained car with driver to be used for the Companies business or cash equivalent thereof.

2. Contribution to Provident Fund, Super Annuation Fund and Annuity Fund to the extent these either singly or puttogather are not taxbale under Income Tax Act, 1961.

3. Tele Communication facility at residence.

4. Payment of gratuity and other retiral benefits.

5. Leave encashment.

The aggregate remuneration to Mr. Anand Gadkari as Managing Director in any financial year shall not exceed the limitsprescribed from time to time under Sections 196, 197 and other applicable provisions of the Companies Act, 2013 readalongwith Schedule V to the said Act, unless approved by the Central Government .

Mr. Anand Gadkari shall be liable to retire by rotation.

Mr. Anand Gadkari has been appointed as a member of Stake holders' Relationship Committee of the Company on 16th May,2014.

Sr.

No.Particulars

3 Expected increase in productivity andprofits in measurable terms.

As the Company's business is project based, it is not possible to predictincrease in productivity and profits for the future years in measurable terms,




Phone no. +91 020 6645 0800 | Fax No : +91 020 6645 0801

good results in the forthcoming year. The Company has also won 2 ordersfor hydration plants which will be manufactured in India. The Company hasstrengthened the existing processes and increased the managementbandwidth in these areas, with resources dedicated to Project Monitoring& Control as well as by strengthening/augmenting skills in areas likeerection works for the existing 2 projects.

12


Mr. Anand Gadkari is neither a Director on the Board nor holds committee membership of any other public company. He doesnot hold any equity shares of the Company as on the date of this Notice.

Except Mr. Anand Gadkari, being an appointee, none of the Directors and Key Managerial Personnel of the Company and theirrelatives are concerned or interested, financial or otherwise, in the resolution set out at Item No. 10 & 11.

As per Sections 196, 197 and other applicable provisions of the Companies Act, 2013 read alongwith Schedule V to the saidAct, members' approval by way of Special Resolution is required.

The Board of Directors recommends passing of the Ordinary Resolution at Item No. 10 and Special Resolution at Item No.11of the Notice.

The Notice read with the Explanatory Statement shall be considered as an abstract of the terms of appointment and paymentof remuneration to Mr. Anand Gadkari as Managing Director and a Memorandum as to the nature of the concern or interest ofthe Director as required under Section 184 of the Companies Act, 2013.

The information required under Clause (iv) of proviso to paragraph 1(B) of Section II of Part II of Schedule V of the CompaniesAct, 2013 is provided below.

INFORMATION REQUIRED UNDER CLAUSE (IV) OF PROVISO TO PARAGRAPH 1(B) OF SECTION II OF PART II OF

SCHEDULE V OF THE COMPANIES ACT, 2013:

Sr.

No.Particulars General Information

The Company is mainly engaged in the business of reheat and heattreatment furnaces and lime plants for the steel industry. The Company isalso authorised by its memorandum to have the business of manufacturersand dealers in all kinds of electrical, mechanical, metallurgical, chemical,electronic, construction and all other types of machinery particularly toengage in and carry out the business of planning, design, manufacturing,constructing and erecting all types of equipments, material handling plantsfor all types of industry and to act as Consultants and Advisors in the matteraforesaid.

The Company is in the business of design, engineering, supply, constructionand erection of industrial plants (mainly reheat and heat treatment furnacesand lime calcinations plants). Components and fabricated items of supplyare being outsourced.

1 Nature of Industry

2. Date or expected date of Commencementof Commercial Production

Not applicable

3. In the case of new Companies, expecteddate of commencement of activities asper project approved by FinancialInstitutions appearing in the prospectus.

Not applicable

4. Financial Performance Loss for the year 2013 : Rs. 5,00,92,350/-

5. Export Sales & net foreign exchangeearnings.

Rs. 9,37,41,054/-

6. Foreign Investments or Collaborations,if any

The Company has no foreign investments. However, Terruzzi Fercalx SpA,a Company incorporated in Italy holds 57.69% of the total issued and paid-up share capital of the Company and Societa Italiana Per Le Imprese AllEstero - SIMEST SpA, a government financial institution based in Italyholds 13.79% of the total issued and paid-up share capital of the Company.

II. Information about the appointee, Mr. Anand Gadkari

Sr.

No. Details of Mr. Anand Gadkari

1. Qualification He is Bachelor in Mechanical Engineering and holds Masters of BusinessAdministration

2. Age 38 years




Phone no. +91 020 6645 0800 | Fax No : +91 020 6645 0801

13

Sr.

No. Details of Mr. Anand Gadkari

3. Experience He has strong functional experience of 15 years in Industrial Marketing cateringto clients in various Segments like Chemical, Fertilizer, Automobile, HeavyEngineering, Engineering Consultants, OEMs, Forging industries and relatedindustries.




Phone no. +91 020 6645 0800 | Fax No : +91 020 6645 0801

7. Remuneration Proposed Rs. 24,00,000/- p.a.

8 Comparative remuneration profile withrespect to industry, size of the Company,profile of the position and person (in caseof expatriates the relevant details would

be w.e.f. the country of his origin)

From Rs. 50,00,000/-p.a. to Rs. 70,00,000/- p.a.

9. Pecuniary relationship directly orindirectly with the Company orrelationship with the managerialpersonnel, if any.

Except his remuneration as Managing director, Mr. Anand Gadkari has noother pecuniary relationship with the Company or any other managerialpersonnel.

4. Past Remuneration Rs. 24,00,000/- p.a.

5. Recognition or Rewards No external recognition or rewards.

6. Job Profile & Suitability The Management of day to day operations of the Company which is projectbased technological Company, under the supervision and control of the

Board. He was been appointed as Chief Executive Officer of the Compaywith effect from 14th January, 2013. Mr. Anand Gadkari has both thetechnical and managerial skills and experience for this job. During histenure, he has been closely involved in the development of sales andproject management of two existing large public sector contracts.


Sr.

No. Particulars

1 Reasons for loss or inadequate profits Due to the reasons beyond its control the completion of the two publicsector orders being executed by the Company has been delayed whichhas impacted the financial results of the Company. Moreover, there hasbeen slowdown in the economic growth of the country particularly in thelast year which has adversely affected the steel industry which forms themajor customer base of the Company. This together with the increasedcompetition from both domestic and foreign players has resulted in thepaucity of fresh orders and lower margins.

2 Steps taken or proposed to be taken The Management of the Company was taken over by Terruzzi FercalxSpA, Italy in the year 2010. Terruzzi Fercalx SpA, who are the global leadersin lime plants have also invested in the equity capital of the Company. TheCompany now has access to greater financial resources and markets,both of which are required for the future growth of the Company. Efforts arealso being made to improve the order load, both in the domestic andexport markets and to diversify the products and services offered by theCompany. Your Company is also targeting to complete the existing twopublic sector projects by setting realistic deadlines. In order to increase thesales and revenue of the Company, the Management has re-structured theSales Department for effective results. During the last year, the sales teamhas continued aggressive scouting in the markets, to re-enter and re-establish the presence of Vulcan Engineers Limited among the customers,and the results of which are expected in the near future. The Company hasaccess to the latest technology and systems as well as markets in China,Europe, South America, Africa and other parts of the world, where thePromoters, Terruzzi Fercalx SpA have a presence and has sub-contracted

14



Sr.

No. Particulars

3 Expected increase in productivity andprofits in measurable terms.

As the Company's business is project based, it is not possible to predictincrease in productivity and profits for the future years in measurable terms,




Phone no. +91 020 6645 0800 | Fax No : +91 020 6645 0801

part of the orders received by them in Zambia & Mongolia to the Company.However, sourcing from India by the Terruzzi Fercalx Group is expected togrow in the future. The Company with the help of Terruzzi Fercalx Grouphas expanded its geographical footprint into the international & domesticmarket and has taken a number of initiatives which are expected to yieldgood results in the forthcoming year. The Company has also won 2 ordersfor hydration plants which will be manufactured in India. The Companyhas strengthened the existing processes and increased the managementbandwidth in these areas, with resources dedicated to Project Monitoring& Control as well as by strengthening/augmenting skills in areas likeerection works for the existing 2 projects.

Mr. Anand Gadkari has been appointed on the following terms :

Remuneration : Rs. 2,00,000/- p.m.

Period : 3 years commencing from 16th May, 2014 to 15th May, 2017.

General Terms:

Mr. Anand Gadkari will be a member of the Board of Directors and shall be liable to retire by rotation. Mr. Anand Gadkari will notbe entitled to sitting fees.

Subject to the superintendence, control and direction of the Board, provisions of Section 179 and 180 of the Companies Act,2013, and the Articles of Association of the Company, Mr. Anand Gadkari will be overall in charge of management of theCompany.

Notwithstanding anything contained herein, Mr. Anand Gadkari shall cease to hold his office of Managing Director, if he ceasesto hold his office as Director of the Company for any reason.

ITEM NO.12

The shareholders vide ordinary resolution passed by Postal Ballot on 16th December, 2010, had accorded their consent to theBoard of Directors to borrow upto 50 Crores.

Section 180(1)(c) of the Companies Act, 2013 requires that the Board of Directors shall not borrow money in excess of theaggregate of company's paid up share capital and free reserves, apart from temporary loans obtained from the company'sbankers in the ordinary course of business, except with the consent of the shareholders accorded by way of a special resolution.It is therefore necessary that the members pass a Special Resolution under section 180(1)(c) and other applicable provisionsof the Companies Act 2013 to enable the Board of Directors to borrow money in excess of the aggregate of the paid up sharecapital and free reserves of the Company.

Approval of the members of the Company is being sought to borrow money upto Rs.50 Crores pursuant to the provisions ofSection 180(1)(c) of the Companies Act, 2013.

None of the Directors and Key Managerial Personnel of the Company and their relatives is concerned or interested, except asshareholders of the Company, in the resolution set out at Item No. 12.


Place : Italy Dr. Daniele TerruzziDated : 16th May, 2014 Chairman

Registered Office:104,105 & 106, Trade Centre, "C" Wing,First Floor, North Main Road,Koregaon Park, Pune - 411 001

15

ADDITIONAL INFORMATION

Brief Resume of Directors seeking appointment/re-appointment at this Annual General Meeting (in pursuance ofClause 49 of the Listing Agreement)

Dr. Daniele Terruzzi

Dr. Daniele Terruzzi is 53 years old and is Italian by nationality. He has University Degree in Law.

After graduating, he worked in the family owned Company. During that time, he gained valuable experience and knowledge inthe business of manufacturing of Lime Plants and Autoclaves and also travelled around the world promoting the company andleading and conducting several difficult and sensitive negotiations. From 1990 onwards, he has contributed significantly in themanaging of the company, especially all the commercial activities.

Dr. Daniele Terruzzi is Managing Director of Terruzzi Fercalx SpA and Director in Terruzzi Fercalx Engineering Pvt. Ltd., TerruzziFercalx Energy Srl. and Immobiliare Giacobina Sas di Terruzzi P.F. & C.

He does not hold by himself or for any other person on a beneficial basis, any shares in the Company.

Dr. Daniele Terruzzi is son of Mr. Astorre Terruzzi and brother of Ms. Paola Terruzzi

Ms. Paola Terruzzi

Ms. Paola Terruzzi is 43 years old and is Italian by nationality. She has a Masters Degree in Corporate Finance.

After graduating she started working with the family run company. At present, she is the Managing Director of M/s TerruzziFercalx SpA, Italy and is in charge of the financial affairs of the Company.

Ms. Paola Terruzzi is Managing Director of Terruzzi Fercalx SpA and Director in Terruzzi Fercalx Engineering Pvt. Ltd., TerruzziFercalx Energy Srl. and Immobiliare Giacobina Sas di Terruzzi P.F. & C.

She does not hold by himself or for any other person on a beneficial basis, any shares in the Company.

Ms. Paola Terruzzi is daughter of Mr. Astorre Terruzzi and sister of Dr. Daniele Terruzzi.

Mr. Massimo Ferracci

Mr. Massimo Ferracci is 54 years old and is Italian by nationality. He holds Diploma from Istituto T.co Commerciale "Duca degliAbruzzi" - Rome. He completed his Masters in the Monetary and Banking Market, Boston, USA. He has also completedSpecialised courses in Business Administration, Risk Management, Derivatives etc.

He has wide experience in banking, financial and foreign orgnaisation sectors including in the management of banks andfinancial institutions. He has been rendering professional management and financial consultancy services to several Companiesin Italy since 1996. He is at present a University Lecturer in Banking and Finance at Sienna University, Italian ManagementInstitute, Milan, ABI, Italian Banking Association, Rome, PST, Polo Scientifico Technologico, Livorno. He also contributed forvarious publications on Banking and commerce both within Italy and internationally.

Mr. Massimo Ferracci is not a Director in any other Company in India. He does not hold by himself or for any other person on abeneficial basis, any shares in the Company.

Mr. Claudio Del Bianco

Mr. Claudio Del Bianco is 55 years old and is Italian by nationality. He has graduated in Political Science.

Mr. Claudio Del Bianco began his career as Manager Regional Committee of Lombardy and was involved with the departmentsof Health Commerce and Tourism, Hotel Industry, Sports and Recreation. At present he has been working with SEA -SpA MilanAirports as External Relation Manager & Publicity Officer.

Mr. Claudio Del Bianco is not a Director in any other Company in India. He does not hold by himself or for any other person ona beneficial basis, any shares in the Company.

Mr. Massimiliano Altabella

Mr. Massimiliano Altabella is 39 years old and is Italian by nationality. He has a degree in Economics from the University ofBologna and an MBA from the Graduate School of Information Technology Management.

Mr. Massimiliano Altabella has developed expertise in Banking and has been working in the banking sector in variouscapacities for the last ten years and is at present the Chief Representative assistant at the Mumbai Representative Office ofBanco Monte del Paschi di Siena, Italy.

Mr. Massimiliano Altabella is director in Itermas Travel & Style Private Limited. He does not hold by himself or for any otherperson on a beneficial basis, any shares in the Company.

Mr. Roberto De Filippis Delfico

Mr. Roberto De Filippis Delfico is 44 years old and is Italian by nationality. He has completed his graduation in Architecture andinterior design in the faculty of applied art and architecture of Chieti, Italy.




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16


Mr. Roberto De Filippis Delfico began his career with The Euromobilia spa, European Centre of Furniture in 1991 as anarchitect and interior designer in Pomezia (Rome).

In 1992, he became Managing Director of the ward of kitchens of Euromobilia.

From 1999 to 2003, he was the owner of the shop and Architects centre of furniture "Architetture D'Arredo" srl in Colleferro(Rome).

From 2003 to 2006, he performed the profession of interior designer with important and specialized centres for the furnitureindustry, specializing in luxury furnishings, and for the Italian and foreign market (Russia, the United Arab Emirates, USA, Libyaand Malta).

He has developed during the above mentioned period strong relationships with important Italian companies working in thefurniture industry, such as Feg, Molteni, Salvarani, Valcucine, Arclinea, Veneta Cucine, Stosa, B & B, Rimadesio, Minotti,Besana and many others.

From 2006 to 2012, he was the kitchens designer at "Casa Berloni" in Rome.

From 2009 onwards has been associated with"Art Manager" coop company which specializes in financial services andnational and international consulting, which has given him wide exposure in the field of economics and finance.

Presently he is is Indian Country Manager for companies such as Romeo Orsi, Novaserenissima, Oikos cucine, Novalineacucine, and Quartet Group, companies that are specialized in interior luxury, contract and other furniture businesses.

Mr. Roberto De Filippis Delfico is not a Director in any other Company in India. He does not hold by himself or for any otherperson on a beneficial basis, any shares in the Company.

Mr. Ranganath Desai

Mr. Ranganath Desai is 58 years old and Indian by nationality. He has graduated in Commerce with Advanced Accountancyand Auditing as his major subjects.

Mr. Ranganath Desai joined Vulcan Engineers Limited in 1982 and has been working with the Company for over 32 years invarious capacities. He has immense knowledge and experience in the field of Finance, Accounts, Taxation, Administration,Human Resources and Indian Laws.

Mr. Ranganath Desai is not a Director in any other Company in India. He holds 200 shares in the Company.

Mr. Anand Gadkari

Mr. Anand Gadkari is 38 years old and Indian by nationality. He is Bachelor of Engineering (Mechanical) and has completed hisMasters in Business Administration from Pune University.

Mr. Anand Gadkari has strong functional experience of about 15 years in Industrial Marketing catering to clients in variousSegments like Chemical, Fertilizer, Automobile, Heavy Engineering, Engineering Consultants, OEMs, Forging industries andrelated industries. He has developed new markets and consistently maintained the same against stiff competition. He was alsoinvolved in introducing new products successfully in the market. Before joining us, he has worked with Sanmar EngineeringCorporation; Bajaj Group of Companies and Poonawala Group of Engineering Companies, in various capacities.

Mr. Anand Gadkari has been appointed as Chief Executive Officer of the Company with effect from 14th January, 2013. He hasboth the technical and managerial skills for this job. During his tenure as Chief Executive Officer, he has been closely involvedin the development of sales and project management of two existing large public sector contracts.

Mr. Anand Gadkari is not a Director in any other Company in India. He does not hold by himself or for any other person on abeneficial basis, any shares in the Company.




Phone no. +91 020 6645 0800 | Fax No : +91 020 6645 0801


Place : Italy Dr. Daniele Terruzzi

Dated : 16th May, 2014 Chairman

Registered Office:

104,105 & 106, Trade Centre, "C" Wing,First Floor, North Main Road,Koregaon Park,Pune - 411 001

17

DIRECTORS' REPORT

Dear Shareholders,

Your Directors are pleased to present the Fiftieth Annual Report of your Company together with the Audited Statements ofAccounts for the year ended 31st December, 2013.

FINANCIAL HIGHLIGHTS

In view of the carried forward losses, your Directors regret their inability to recommend any dividend.

FINANCIAL RESULTS

Sales and Income for the current year ended 31st December, 2013 is Rs. 1,233.23 lacs. However, for the previous financial yearended 31st December, 2012, Sales and Income was Rs. 1,113.30 lacs. The loss after tax for the current year amounted to Rs.782.47 lacs as against the loss after tax of Rs. 308.46 lacs in the previous year.

REVIEW OF OPERATIONS AND FUTURE PROSPECTS

The main reason for losses in the previous year was prolonged delay in completion of existing public sectors orders, lack of neworders, derecognition of deferred tax assets, exchange rate loss, and expenses on exceptional items shown separately in Profit& Loss account.

The Company has access to the latest technology and systems as well as markets in China, Europe, South America, Africa andother parts of the world, where the Promoters, Terruzzi Fercalx SpA have a presence and have sub-contracted part of the ordersreceived by them in Zambia & Mongolia to the Company. Sourcing from India by the Terruzzi Fercalx group is expected to growin the future. The Company with the help of Terruzzi Fercalx Group has expanded its geographical footprint in the international& domestic markets and has taken a number of initiatives which are expected to yield good results in the coming years. TheCompany has also won 2 orders for hydration plants which will be manufactured in India.

TRANSFER OF LEASE RIGHTS IN LAND AND FACTORY LOCATED AT AHMEDNAGAR

Since the Company's manufacturing operations at Ahmednagar factory have been suspended, since 1998. Your Board ofDirectors felt that it would be in the interest of the Company to transfer its lease hold rights in the land and factory building locatedat Plot no. B-21, MIDC Industrial Area, Ahmednagar and has signed a `Memorandum of Understanding' on 27th February, 2014to this effect with a prospective buyer. Since the book value of the above assets, is less than 20% of the Company's net worth ason 31st December, 2013, section 180(1)(a) of the Companies Act, 2013 is not applicable.

DIRECTORS

As per provisions of section 152 of the Companies Act, 2013, Dr. Daniele Terruzzi and Ms. Paola Terruzzi, Directors of theCompany retire by rotation at the ensuing Annual General Meeting and being eligible offer themselves for re-appointment. YourDirectors recommend their re-appointment.

At the Board Meeting held on 28th February, 2014, Mr. Ranganath Desai was re-appointed as Director designated as ExecutiveDirector - Finance for a further period of one year starting from 21st February, 2014 to 20th February, 2015, subject to approvalof the shareholders at the ensuing Annual General Meeting. However, Mr. Ranganath Desai resigned as an ExecutiveDirector - Finance of the Company with effect from 4th July 2014 vide his letter dated 12th May 2014. The approval ofshareholders is being sought for re-appointment of Mr. Ranganath Desai for a period starting from 21st February, 2014 to 4thJuly, 2014.

On 14th November, 2013, Mr. Nicola Obert resigned as an Independent Director of the Company. The Board places on recordits sincere appreciation for the valuable services rendered by Mr. Ranganath Desai and Mr. Nicola Obert during their respectivetenure of directorship in your Company.

For the year

ended on 31st December 2013For the year

ended on 31st December 2012

Sales and Income from other sources 1,233.23 1,113.30Profit/(Loss) before taxation (500.92) (436.34)Provision for taxation:- Current tax ---- ----- Deferred tax (282.89) 127.88- Prior period tax adjustment 1.34 (281.55) -- 127.88

Net Profit/(Loss) after taxation (782.47) (308.46)

Rs. in Lacs

18


Mr. Anand Gadkari was appointed as an Additional Director, designated as Managing Director for a period of three years on16th May, 2014, subject to approval of the shareholders at the ensuing Annual General Meeting.

Mr. Roberto De Filippis Delfico was appointed as an Additional Director on 16th May, 2014, designated as Independent Directorto hold the office till the ensuing Annual General Meeting, eligible for re-appointment for a period of five consecutive years fromthe conclusion of ensuing Annual General Meeting and not liable to retire by rotation.

As per applicable provisions of Companies Act, 2013, relevant rules and notifications relating thereto, Mr. Massimo Ferracci, Mr.Claudio Del Bianco and Mr. Massimiliano Altabella, Independent Directors have been appointed as Independent Directors fora period of five consectuive years from the conclusion of ensuing Annual General Meeting and not liable to retire by rotation.

Also in the opinion of the Board, Mr. Massimo Ferracci, Mr. Claudio Del Bianco and Mr. Massimiliano Altabella and Mr. RobertoDe Filippis Delfico, Independent Director fulfils the conditions specified in the Companies Act, 2013 and rules made thereunderfor their appointment as an Independent Directors of the Company and are Independent of the Management.The Company hasreceived consent letters from them.

LISTING OF SECURITIES

The Company's shares are listed on the Bombay Stock Exchange. The annual listing fees have been paid by the Company forthe year 2014-2015. Your Company would be completing its 25 years of listing with BSE on 26th May, 2014.

DEPOSITORY SYSTEM

Your Company's equity shares are available for dematerialization through National Securities Depository Limited (NSDL) andCentral Securities Depository Limited (CDSL). As on 31st December, 2013, 94.98% of the equity shares of your Company wereheld in dematerialized form.

CORPORATE GOVERNANCE

The Company is committed to maintain the standards of Corporate Governance and adhere to the Corporate Governancerequirements set out by SEBI.

The Report on Corporate Governance in compliance with clause 49 of the Listing Agreement with the Bombay Stock ExchangeLimited and the Auditors' Certificate forms part of this Report.

MANAGEMENT DISCUSSION AND ANALYSIS

The Management Discussion and Analysis Report on the operations of the Company is provided in a separate section andforms part of this Report.

DEPOSITS

The Company has not invited/accepted any deposits from the public during the year ended 31st December, 2013. There wereno unclaimed or unpaid deposits as on 31st December, 2013.

PARTICULARS OF EMPLOYEES

None of the employees has received remuneration/salary exceeding the limit as stated in Section 217(2A) of the CompaniesAct, 1956 read with the Companies (Particulars of Employees) Rules, 1975 as amended.

CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

Particulars required by Section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in theReport of Board of Directors) Rules, 1988 are given in Annexure 'A'.

DIRECTORS' REPONSIBILITY STATEMENT

Pursuant to Section 217(2AA) of the Companies Act, 1956 the Directors confirm that: -

(i) in the preparation of the annual accounts, the applicable accounting standards have been followed with proper explanationsrelating to material departures, if any.

(ii) appropriate accounting policies have been selected and applied consistently and the Directors have made judgments andestimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31stDecember, 2013 and of the loss for the year ended 31st December, 2013.

19

(iii) proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with theprovisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraudand other irregularities.

(iv) the annual accounts have been prepared on a going concern basis.

AUDITORS

M/s. Suresh Surana & Associates LLP, Chartered Accountants, Statutory Auditors retires at the ensuing Annual GeneralMeeting and are eligible for reappointment. The Company has received a certificate from the statutory auditors to the effect thattheir re-appointment, if made, would be within the limits prescribed. The Board recommends their re-appointment.

SHIFTING THE REGISTERED OFFICE OF THE COMPANY

The Registered office of the Company has been shifted from Mumbai to Pune and all the compliances with the Bombay StockExchange, Registrar of Companies and other concerned authorities, have been duly complied with.

ACKNOWLEDGEMENTS

Your Directors wish to record their appreciation of the commitment of to the management team and all employees and also itsbankers for their support.

Your Directors also wish to record their appreciation for the invaluable support both managerial and technical extended by theCompany's Holding Company, M/s. Terruzzi Fercalx SpA, Italy




Registered Office:

104,105 & 106, Trade Centre,



20


ANNEXURE ‘A’ TO THE DIRECTORS’ REPORT

INFORMATION PURSUANT TO COMPANIES

(DISCLOSURE OF PARTICULARS IN THE REPORT OF BOARD OF DIRECTORS) RULES, 1988

FORM A

CONSERVATION OF ENERGY

Details of energy consumption during the year are given below:

Power and Fuel Consumption

Electricity: Since the Company's engineering and manufacturing activities at its works have been suspended, consumption ofelectricity was nominal. There was no fuel consumption.

FORM B

RESEARCH AND DEVELOPMENT (R&D), TECHNOLOGY ABSORPTION, ADAPTATION AND INNOVATION

Your Company continued to absorb foreign technology for process equipments.

(1) Specific Areas

Development of detailed engineering/process/methods/materials and improvement in systems in the existing process.

(2) Benefits Derived

Cost reduction/improved utilization of machinery and energy. Technological upgradation and development.

(3) Future plan of action

Improvement in the existing products and processes in various areas in which the Company is engaged.

(4) Expenditure on R&D

No separate funds allocated.

FOREIGN EXCHANGE EARNINGS AND OUTGO

Earnings in foreign currency : Rs. 949.65 lacs

Outgo in foreign currency : Rs. 27.34 lacs




Registered Office:

104,105 & 106, Trade Centre,



21

MANAGEMENT DISCUSSION & ANALYSIS REPORT

INDUSTRY OVERVIEW

The Indian economy has faced a number of challenges during the last year which resulted in growth slow down, inflationarypressures and weakening of the rupee. This has been in the background of unsupportive external environment, domesticstructural constraints and political uncertainties. The outlook for the current year is projected to be better, but a major uncertainfactor is the outcome of the general elections.

The overall economic slowdown has impacted the industrial sector with lower investments, inordinate delay in projects alongwithother domestic and global factors has resulted in lower industrial growth including in the capital goods industry. During the lastyear, very few projects in the steel sector have been finalized. However, the Union Budget 2013-2014 has put emphasis oncontainment of inflationary pressures, mitigation of structural bottlenecks and raising investments.

After witnessing the lowest growth in GDP during the last decade, the Indian economy in 2013 has seen economic expansiondrop to levels even below the crisis year of 2008-2009. Domestic supply bottlenecks and policy obstacles have seen growthdecelerate and industrial output slump. The existing projects have been delayed due to financial constraints and implementationgaps. The high inflation and the tight monetary policy also continued to challenge the economic revival. The Government andRBI have taken measures to reduce fiscal deficit to provide stability and protect the credit standing. New investments areexpected in almost all the major industrial sectors. These changes are expected to yield positive results in the coming years andyour company will surely have its share of benefits in the India growth story.

FINANCIAL AND OPERATIONAL PERFORMANCE

During the year ended 31st December, 2013, sales and other income was Rs. 1,233.23 lacs as against Rs. 1,113.30 lacs for theyear ended 31st December, 2012. There was a loss before taxation of Rs. 500.92 lacs for the current year ended 31st December,2013, as compared to loss before taxation of Rs. 436.34 lacs for the year ended 31st December, 2012.

SEGMENTAL INFORMATION

The Company has only one reportable business segment viz. engineering goods & services, which is being considered as theprimary segment. Disclosures as to the secondary segment, i.e. ‘Geographical Segments' are given below:

Notes:

1) Secondary segments are identified by the management as per the requirements of Accounting Standard (AS) - 17 'SegmentReporting" taking into account the organisation structure as well as the differing risks and returns.

2) The segment revenue and assets include revenue and assets, which are identifiable with each segment and amountallocated to the segments on a reasonable basis.

3) Figures in brackets are corresponding figures for the previous year.

OPPORTUNITIES & THREATS

The Company has access to the latest technology and systems as well as markets in China, Europe, South America, Africa andother parts of the world, where the Promoters, Terruzzi Fercalx SpA have a presence and has sub-contracted part of the ordersreceived by them in Zambia & Mongolia to the Company.

The aggressive competition by international and local companies in the area of Lime Kilns and Furnaces in the Indian marketcontinues to be a major problem, especially while bidding for large public sector projects which has significantly reduced theorder load. The Company has been exploring all avenues to reduce overheads, develop new markets and introduce newproducts and services. Concerted marketing efforts are also being made and which has started to show results and to improvethe order position.

Due to various reasons, inspite of all efforts made by the Company, the erection and commissioning of two large public sectorprojects under execution have still not been completed which has affected the Company's cash flow and profitability. Thepaucity of new orders is a matter of grave concern.

Outside IndiaRs.

Within IndiaRs.

TotalRs.

1. Segment revenue

Sales and income from operations 94,964,929 26,773,205 121,738,134

(37,568,420) (72,011,229) (109,579,649)

2. Carrying amount of assets by geographical location of assets

Segment assets 24,540,117 180,643,017 205,183,134

(1,135,257) (234,971,272) (236,106,529)

3. Additions to fixed assets

Additions to fixed assets – 144,164 144,164

(–) (558,958) (558,958)

22


However, sourcing from India by Terruzzi Fercalx Group is expected to grow in the future. The Company with the help of TerruzziFercalx Group has expanded its geographical footprint into the international & domestic market and has taken a number ofinitiatives which are expected to yield good results in the forthcoming year.

Apart from downturn in the Indian economy, which is the reason for major projects not being finalized, India is a very pricesensitive market, which was also a cause for paucity of orders. This has been addressed by changing the strategy of importingkey equipments from the Parent Company. Instead, we are now manufacturing them in India and this has resulted in theCompany being more competitive. The Company has won 2 orders for hydration plants which will be manufactured in India.

INTERNAL CONTROLS

The Audit Committee of the Board of Directors meets on a regular basis to review the control systems and to take stock of thesituation. Any significant findings by the Internal Auditor are reviewed by the Audit Committee.

The Company has also set up internal systems and control mechanisms to ensure:

On going risk assessment, identification of new risks and implementation of effective mitigation processes to safeguardthe Company's interests.

Transparency and efficiency of operations and resource management.

Accuracy in financial reporting by implementation of systems framework for detection of errors and frauds.

Law and regulatory compliance.

As a subsidiary of an Italian Company, the Company has established rules with respect to internal controls and reporting inclose consultation with the Holding Company and the Auditors.

RISK MANAGEMENT

The Company has set processes in place to ensure that it has a proper and continuous identification and management of risk.It has set up a Committee to monitor, evaluate & mitigate risk.

INFLATION RISK

The continued inflationary pressure continues to be a major problem, though it has eased as compared to the previous year itis still at a high level.

RISK MITIGATION

Efforts are being made to counter the inflationary pressure through both price adjustments and elimination of operationalinefficiencies as well as incorporation of escalation clauses in longer period contracts, wherever possible.

FINANCIAL RISK

Financial risks include liquidity for working capital requirements and non-fund facilities like Bank Guarantee limits required forlarge projects and the penalty clauses in large public sector orders.

RISK MITIGATION

With the support of the Holding Company, M/s. Terruzzi Fercalx SpA, the Company is in a stronger negotiating position withbankers and financial institutions. The working capital of Company is being financed out of advance payments received fromcustomers and credit facilities from banks.

INTEREST RATE RISKS

The Company does not have any long term borrowings and therefore, does not face any impact on account of interestfluctuations on this account. However, the Company has cash-credit facilities sanctioned by the Bank and volatility in interestrates will have an impact on the present and future credit facilities.

FOREIGN EXCHANGE RATE RISKS

The Company is exposed to foreign currency fluctuations on foreign currency assets and liabilities. The Company proposes toabsorb the effects of foreign exchange rate fluctuations by following established risk management policies. The Companyproposes to enter into forward and option contracts which will not used for trading or speculation. However, there are certaintransactions which cannot be covered under forward and option contracts, to which the Company is exposed to the risk offluctuations in foreign currency.

TECHNOLOGY OBSOLESCENCE RISK

The Company's ability to remain competitive depends on its ability to adapt to changing technology and cutting costs.

RISK MITIGATION

With the association of Terruzzi Fercalx SpA, the Company is assured of access to world technology for the group products.

RISK OF CYCLICAL BUSINESS

The business in the capital goods sector is cyclical in nature and the Company's projects business is predominantly fromsectors like steel and chemical which have witnessed volatility.

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RISK MITIGATION

The Company continually reviews significant developments taking place in the industrial sector and also closely monitors theprojects under execution. The Company is endeavoring to reduce the impact of the cyclical business risks by developing otherproducts and services.

PROJECT MANAGEMENT RISK

Your Company faces risks associated with project execution with a large portion of the business coming from few projects. Asthe duration of the project is 18 months or more, delays can affect the Company's finances and reputation.

RISK MITIGATION

The Management reviews the risks related to key projects at all levels, on a case to case basis depending on their size andcomplexity. The Management has established processes and systems for reviewing the progress and costs of projects. TheCompany has strengthened the existing processes and increased the Management bandwidth in these areas, with resourcesdedicated to Project Monitoring & Control as well as by strengthening/augmenting skills in areas like erection works.

CLIENT RISK

Excessive exposure to a few clients could impact the Company's revenues and profitability in the event of loss of those clients.

RISK MITIGATION

The Company is developing long-term relationships with its major customers as well as enlarging its customer base thusmitigating the risk of inconsistent revenues.

CLIENT LIABILITY RISK

A Client Liability Risk arises in the advent of a failure or deficiency in services rendered to a client. Such failure or deficiencycould result in a claim for damages against the Company.

RISK MITIGATION

The Management pays adequate attention to the negotiation and documentation of contracts wherein an effort is made to limitthe contractual liability for damages.

HUMAN RESOURCE RISK

The Company's main asset is qualified, experienced and skilled personnel, since the engineering industry is knowledgebased. Attrition in human resources could drain valuable knowledge and customer experience and thus have an adverseimpact on revenues. As the size of the Company is relatively small, there is a constant risk of trained and efficient personnelbeing recruited by larger Companies at remuneration levels which are not economical for Companies of our size and turnover.

RISK MITIGATION

The Company creates and maintains a team of talented and experienced staff. The Company imparts efficient and effectivetraining to its staff, blending them into productive resources by creating challenging opportunities on projects. The Companymanages the careers of its employees in order to groom them to assume higher responsibilities. The Company also keepsabreast of HR practices and compensation levels in the industry. The Management recognizes human resources as its greatestasset and makes a special effort to train, develop and retain its employees. The knowledge and skills available with the HoldingCompany are accessible to the Company and the training is imparted by the Group Companies, as and when deemeddesirable.

CONTINGENT LIABILITIES

Details of contingent liabilities are given in Schedule 24 - "Accounting Policies and Notes forming Part of Accounts" for the yearended 31st December, 2013.

STATUTORY COMPLIANCE

Compliance of SEBI regulations and the provisions of the Listing Agreement are ensured by the Board of Directors.

CAUTIONARY STATEMENT

Statements in the Management Discussion and Analysis describing the Company's objectives, projections, estimates andexpectations may be 'forward looking statements' within the meaning of applicable securities laws and regulations. These arebased on certain assumptions and expectations of future events. The Company does not guarantee that these assumptionsand expectations are accurate or will be realised. The actual results or performance could differ materially from those expressedor implied. The Company assumes no responsibility to publicly amend, modify or revise any forward looking statements on thebasis of any subsequent developments, information or events.

24


REPORT ON CORPORATE GOVERNANCE

1. Company's philosophy on code of governance

Vulcan Engineers Limited is committed to create a corporate culture of integrity and transparency for ethical conduct ofbusiness so as to meet its obligations towards all stakeholders

2. Board of Directors

a) Composition

As on 31st December, 2013, the Board of Directors comprised of seven (7) directors, out of which one is an ExecutiveDirector designated as Executive Director - Finance and six (6) others are non-executive Directors. As per the Clause49 of the listing agreement, since the Chairman is a non-executive Director and belongs to the Promoter Group, 50%of the Board should be comprised of Independent Directors. Accordingly, the Company had four(4) IndependentDirectors. However, on 14th November, 2013, Mr. Nicola Obert resigned as an Independent Director of the Companyand at present the Company has three (3) Independent Directors. None of the Directors on the Board is a member ofmore than ten (10) Committees or Chairman of more than five (5) Committees (as specified in Clause 49 of the ListingAgreement) across all Companies in which he /she is a Director.

On 28th February, 2014, Mr. Ranganath Desai was re-appointed as Executive Director - Finance for a further period ofone year starting from 21st February, 2014 to 20th February, 2015, subject to approval of shareholders. However, Mr.Ranganath Desai resigned as an Executive Director - Finance with effect from 4th July, 2014 vide his letter dated 12thMay, 2014.

Mr. Roberto De Filippis Delfico was appointed as an Additional Director designated as an Independent Director on16th May, 2014.

Mr. Anand Gadkari is being appointed as an Additional Director, designated as Managing Director of the Company fora period of 3 years with effect from 16th May, 2014, subject to the approval of the shareholders.

b) Board Meetings held and Directors' attendance

Seven Board Meetings were held during the year ended 31st December, 2013: 21st February, 2013, 10th May, 2013,3rd June, 2013, 28th June, 2013, 9th July, 2013, 5th August, 2013 and 14th November, 2013. The gap between anytwo Board Meetings did not exceed four months. Notice and agenda papers were circulated to the Directors well inadvance to enable the Board to take informed decisions. All the relevant statements and information necessary forconsidering various matters in the light of Corporate Governance practices as prescribed in Clause 49 of the ListingAgreement were placed before the Board.

Attendance of Directors at Board Meetings during the year ended 31st December, 2013 and at the last Annual GeneralMeeting as also the number of other Companies in which they hold Directorship and Membership or Chairmanship ofCommittees is given below:

Member Chairman

Committees2

Directorships1

Other Boards/CommitteesAttendance

Last AGM(28-6-2013)

BoardMeetings(2013)

PositionName of the Directors

Dr. Daniele Terruzzi Chairman / Promoter- 7 Attended Nil Nil NilNon Executive

Ms. Paola Terruzzi Vice Chairperson / Promoter - 5 Did not attend Nil Nil NilNon Executive

Mr. Ranganath Desai ** Executive Director - Finance 6 Attended Nil Nil Nil

Mr. Astorre Terruzzi Chairman Emeritus/ 2 Did not attend Nil Nil NilPromoter- Non Executive

Mr. Claudio Del Bianco Independent - Did not attend Nil Nil Nil

Mr. Massimo Ferracci Independent 6 Attended Nil Nil Nil

Mr. Nicola Obert* Independent 4 Did not attend Nil Nil Nil

Mr. Massimiliano Altabella Independent 6 Attended Nil Nil Nil

1. Excludes foreign companies, private limited companies, companies under Section 25 of the Companies Act,1956 and Alternate Directorships.

2. Only Audit Committee and Investors Grievance Committee are reckoned for this purpose.

3. Information pursuant to clause 49 of the listing agreement is provided in the notice for convening Annual GeneralMeeting.

* Mr. Nicola Obert resigned as an Independent Director on 14th November, 2013.

** On 28th February, 2014, Mr. Ranganath Desai was re-appointed as Executive Director - Finance for a furtherperiod of one year starting from 21st February, 2014 to 20th February, 2015. However, Mr. Ranganath Desairesigned as an Executive Director - Finance with effect from 4th July, 2014 vide his letter dated 12th May, 2014.

25

Ms. Paola Terruzzi 4 4

Mr. Massimo Ferracci 4 4

*Mr. Nicola Obert 4 3

Mr. Massimiliano Altabella 4 4

(d) Functions of the Audit Committee:

The Audit Committee of the Company is constituted in line with the provisions of Clause 49 of the Listing Agreementwith the Stock exchanges and read with Section 292A of the Companies Act, 1956.

The Audit Committee of the Company performs the following functions:

1. Oversight of the company's financial reporting process and the disclosure of its financial information to ensure that thefinancial statement is correct, sufficient and credible.

2. Recommending to the Board, the appointment, re-appointment and, if required, the replacement or removal of thestatutory auditor and the fixation of audit fees.

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

4. Reviewing, with the management, the annual financial statements before submission to the board for approval, withparticular reference to:

a. Matters required to be included in the Director's Responsibility Statement to be included in the Board's report interms 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 the management, the quarterly financial statements before submission to the board for approval

5A. Reviewing, with the management, the statement of uses / 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 offerdocument/prospectus/notice and the report submitted by the monitoring agency monitoring the utilisation of proceeds

* Resigned as member of the Audit Committee on 14th November, 2013

Note : Mr. Massimo Ferracci who is the Chairman of the Audit Committee, was present at the previous Annual General Meeting of theCompany held on 28th June, 2013.

3. Audit Committee

(a) Terms of Reference

The terms of reference of the Audit Committee are in conformity with the requirements of Section 292A of theCompanies Act, 1956 and Clause 49 of the Listing Agreement.

(b) Composition

The Audit Committee comprises of Ms. Paola Terruzzi, Mr. Massimo Ferracci (Independent), Mr. Nicola Obert(Independent) and Mr. Massimiliano Altabella (Independent). Mr. Massimo Ferracci is the Chairman of the AuditCommittee.

Mr. Nicola Obert resigned as an Independent Director on 14th November, 2013.

Ms. Bela Thakkar, Company Secretary & Head of HR acts as Secretary to the Audit Committee. Executive Director -Finance, Statutory Auditors and Practicing Company Secretary attended the meetings on invitation.

(c) Meetings held and attendance

Four Audit Committee meetings were held during the year. These were held on 21st February, 2013, 10th May, 2013,5th August, 2013 and 14th November, 2013. The meeting held on 21st February, 2013 reviewed the Annual Accountsof the Company for the financial year ended 31st December, 2012 and approved the same. The meetings held on 10thMay, 2013, 5th August, 2013 and 14th November, 2013 reviewed and approved the results for the 1st, 2nd and 3rdquarter respectively.

Attendance at Audit Committee meetings for the year ending on 31st December, 2013 were as follows:

Name of the Member No. of Meetings held No. of Meetings attended

26


Name of the Directors Sitting Fees paid in Rs.

Mr. Nicola Obert 90,000Mr. Massimiliano Altabella 140,000Total 230,000

5. Investors’ Grievance and Share Transfer Committee

(a) Composition

The Investors' Grievance Committee comprises of Dr. Daniele Terruzzi, Ms. Paola Terruzzi and Mr. Ranganath Desai.Dr. Daniele Terruzzi is the Chairman of the Committee.

The Investor's Grievance and Share Transfer Committee was constituted to look after the redressal of shareholdercompliants and grievances and faciliate speedy disposal of requests pertaining to transfer, transmission of shares inphysical form, issue of duplicate share certificates etc. , non-receipt of Balance sheet and non-receipt of declareddividends, as required in Clause 49 of the Listing Agreement.

Ms. Bela Thakkar, Company Secretary & Head of HR is the Compliance Officer.

(b) Meetings held and attendance

During the year, four meetings of the Investors' Grievance and Share Transfer Committee were held on 21st February,2013, 10th May, 2013, 5th August, 2013 and 14th November, 2013. Attendance at the Investors' Grievance and ShareTransfer Committee meetings during the year ended 31st December, 2013 was as follows:

Note: Mr. Astorre Terruzzi, Dr. Daniele Terruzzi, Ms. Paola Terruzzi, Mr. Massimo Ferracci and Mr. Claudio DelBianco, all have declined to accept sitting fees.

Name TOTAL

Mr. Ranganath Desai 2,220,010 NA NA NA 2,220,010

Salary Bonus Other perks Commission

Note : Mr. Ranganath Desai was re-appointed as an Executive Director- Finance for a further period of 1 yearw.e.f. 21st February, 2013

b) Remuneration paid to Non-Executive Directors:

of a public or rights issue, and making appropriate recommendations to the Board to take up steps in this matter.

6. Reviewing, with the management, performance of statutory and internal auditors, and adequacy of the internal controlsystems.

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

8. Discussion with internal auditors any significant findings and follow up there on.

9. Reviewing the findings of any internal investigations by the internal auditors into matters where there is suspectedfraud or irregularity or a failure of internal control systems of a material nature and reporting the matter to the board.

10. 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.

11. To look into the reasons for substantial defaults in the payment to the depositors, debenture holders, shareholders (incase of non payment of declared dividends) and creditors.

12. To review the functioning of the Whistle Blower mechanism, in case the same is existing.

12A. Approval of appointment of CFO (i.e., the whole-time Finance Director or any other person heading the financefunction or discharging that function) after assessing the qualifications, experience & background, etc. of the candidate.

13. Carrying out any other function as is mentioned in the terms of reference of the Audit Committee.

4. Remuneration Committee

a) Composition

The Board had constituted a remuneration committee on 28th May, 2010.The members of the Remuneration Committeecomprises of Ms. Paola Terruzzi, Mr. Massimo Ferracci (Independent), *Mr. Nicola Obert (Independent) and Mr.Massimiliano Altabella (Independent). Ms. Paola Terruzzi is the Chairperson of the Remuneration Committtee. Therewas one meeting of Remuneration Committee held during the year ended 31st December, 2013, on 21st February,2013 to re-appoint Mr. Ranganath Desai, as Executive Director - Finance, for a further period of one year starting from21st February, 2013.

*Mr. Nicola Obert resigned as member of Remuneration Committee on 14th November, 2013

b) Remuneration of Directors :

(a) Remuneration paid to Executive Directors:

27

(c) Share Transfers

With a view to servicing the shareholders more expeditiously, the Board has delegated the authority to a Sub-committeeof Directors to approve share transfers and transmissions received from Link Intime India Private Ltd., the Company'sRegistrars and Share Transfer Agents. All share transfers are ratified by the Board. The Sub Committee met 9 timesduring the last financial year.

There were no application for share transfer pending as at 31st December, 2013.

(d) Investors Complaints

The Company received some complaints from shareholders during the year as shown below. These complaints wereresolved to the satisfaction of the shareholders. The average time taken by the Company to resolve complaints was 10-15 days.

6. Code of Conduct

The Board of Directors of the Company has laid down a Code of Conduct for all its members and Senior Managementpersonnel, who have affirmed their compliance therewith.

7. Steps for Prevention of Insider Trading Practices

In compliance with the SEBI (Prevention of Insider Trading) Regulations as amended. The Company has issued acomprehensive set of guidelines after incorporating the amendments prescribed by SEBI, advising and cautioningmanagement staff and other relevant business associates on the procedure to be followed while dealing in equity sharesof the Company and disclosure requirements in this regard. The Company believes that 'The Code of Internal Procedureand Conduct' and 'The Code of Corporate Disclosure Policies' that it has framed in this regard will help in ensuringcompliance with the amended SEBI regulations.

8. General Body Meetings

a) Date, time and location of last three Annual General Meetings and the Special Resolutions passed thereat:

Complaintsreceived

Complaintsredressed

Complaintspending

Non-receipt of Dividend/Interest/ Redemption Warrants 3 3 -

Non-receipt of Annual Report 1 1 -

Non-receipt of Redemption Amt 1 1 -

Total 5 5 -

Nature of Complaint

Name of the Member No. of Meetings held No. of Meetings attended

Dr. Daniele Terruzzi 4 2Ms. Paola Terruzzi 4 4Mr. Ranganath Desai 4 3

Financial Year

2010 24/06/2011 11.30 a.m. ‘Sunville' 9, Dr. Annie Besant Road,Worli, Mumbai - 400 018.

2011 29/06/2012 4.30 p.m. ‘Sunville' 9, Dr. Annie Besant Road,Worli, Mumbai - 400 018.

2012 28/06/2013 11.30 a.m. Kilachand Conference Room,Indian Merchants's Chamber,2nd Floor, IMC Building, IMC Marg,Churchgate, Mumbai - 400 020.

Date Time Venue Special Resolution passed

Appointment of Mr. Ranganath Desai as Whole-time Director designated as Executive Director-Finance and Corporate Services for a periodof one year from 22nd February, 2012 to 21st

February, 2013.

No special resolution was passed.

Re-appointment of Mr. Ranganath Desai asWhole-time Director designated as ExecutiveDirector - Finance for a period of one yearfrom 21st February, 2013 to 20th February, 2014.

To the Shareholders of Vulcan Engineers Limited

Sub: Compliance with Code of Conduct

I hereby declare that all the Board Members and Senior Management Personnel have affirmed compliance with theCode of Conduct as adopted by the Board of Directors.

Sd/-

Dated : 16th May, 2014 Anand GadkariPlace : Pune Managing Director

28


b) Date, time and location of last three years Extra-Ordinary General Meetings and the Special Resolutions passed

thereat:

Financial Year

2011 28/02/2011 11.30 a.m. ‘Sunville' 9, Dr. Annie BesantRoad,Worli, Mumbai - 400 018.

2011 12/09/2011 11.30 a.m. ‘Sunville' 9, Dr. Annie BesantRoad,Worli, Mumbai - 400 018.

2012 NA NA NA

2013 NA NA NA

Date Time Venue Special Resolution passed

Resolution under section 81(1)(A) forissue and allotment of 13,10,000 equityshares of the Company having face valueof Rs. 10 each at a price of Rs. 46.50 perequity share on preferential basis toSIMEST SpA.

Note: At the Board Meeting held on 28th May, 2010, the financial year of the Company has been changed from 1st

April - 31st March to 1st January - 31st December.

NA

Resolution under section 81(1)(A) forissue and allotment of 13,10,000 equityshares of the Company having face valueof Rs. 10 each at a price of Rs. 46.50 perequity share on preferential basis toSIMEST SpA in supercession of theresolution passed by the members on 28th

February, 2011.

NA

c) Special Resolution passed through Postal Ballot:

During the year, pursuant to the provisions of Section 192A of the Companies Act, 1956 read with the Companies(Passing of the Resolution by Postal Ballot) Rules 2011, certain resolution was passed by shareholders by PostalBallot. The Postal Ballot notice, the draft Resolution and Explanatory Statement thereto were sent to the shareholdersalongwith a Postal Ballot Form for their consideration.

Ms. Ratan Kapadia, Practicing Company Secretary, was appointed as scrutinizer for the Postal Ballot, who submittedher report to the Chairman of the Meeting, Mr. Ranganath Desai. The details of the Postal Ballot are given below:-

d) Procedure adopted for Postal Ballot:

i. The Board at its meeting approved the item to be passed through Postal Ballot and authorizes one of the functionalDirectors and the Company Secretary to be responsible for the entire process of Postal Ballot.

ii. A professional such as a Chartered Accountant/ Company Secretary, who is not in employment of the Company, isappointed as the Scrutinizer for the poll process.

iii. Notice of Postal Ballot along with the ballot papers are sent to the shareholders along with a self addressedenvelope addressed to the Scrutinizer.

iv. An advertisement is published in a National newspaper about the dispatch of ballot papers and notice of PostalBallot.

v. The duly completed Postal Ballot papers are received by the Scrutinizer.

vi. Scrutinizer gives her report to the Chairman of the Meeting.

vii.The Chairman of the Meeting announces the results of the Postal Ballot in a meeting convened for the same.

Date of

Announcement

of Results

Nature of

resolution ItemTotal No.

of Votes

Polled

No. of

votes in

favour %

No. of

votes

against

%

No. of

invalid

votes %

19th August, 2013 Special Shifting of registered office fromMumbai to Pune under Section146(2), Section 17A and all otherapplicable provisions, if any, of theCompanies Act, 1956.

68,32,044 99.91 0.05 0.04

29

9. Disclosures

• Related party disclosures

i) Related party relationship:

Ultimate holding company Terruzzi Fercalx Finanziaria S.r.l (upto 19th December 2012)

Holding Company Terruzzi Fercalx S.p.A

Enterprise under common control Terruzzi Fercalx S.p.A - India Project Office

Key Management Personnel Mr. Ranganath Desai (Executive Director with effect from 22nd February 2012)

Mr. Anand Gadkari (Chief Executive officer with effect from 14th January2013)

1. The related party relationships have been determined by the management on the basis of the requirements ofthe Accounting Standard (AS) - 18 "Related Party Disclosures" and the same have been relied upon by theauditors.

2. The relationships, as mentioned above, pertain to those parties with whom transactions have taken placeduring the year, except where control exists.

viii. Results are intimated to the Stock Exchange and are put up on the Notice Board of the Company as well ason the Company's Website.

No special resolution is proposed to be conducted through Postal Ballot in the ensuing Annual General Meeting ofthe Company.

As at

31/12/2013

Rs.

Particulars

ParticularsCurrent Year

2013

Rs.

Terruzzi Fercalx S.p.A

Sale of goods 34,145,101

Engineering and service charges income 58,211,322

Purchase of goods 2,979,200

Payment made on behalf of the Company 2,541,834

Expenses incurred by Company and recovered 1,351,627

Terruzzi Fercalx S.p.A - India Project Office

Sale of goods 6,132,351

Expenses incurred by Company and recovered 278,074

Mr. Ranganath Desai

Salary, bonus and allowances 2,220,010

Mr. Anand Gadkari

Salary, bonus and allowances 2,077,398

ii) Transactions with related parties:

Balances as at the year end:

Terruzzi Fercalx S.p.A

Payable 88,636,625

Receivable 23,755,124

Terruzzi Fercalx S.p.A - India Project Office

Advances received 2,500,000

Receivable 16,477,602

Mr. Ranganath Desai - Payable 141,550

Mr. Anand Gadkari - Payable 123,933

30


• Details of non-compliance, penalties and strictures imposed

There have neither been any instances of non-compliance nor any penalty or stricture imposed on the Company by theStock Exchange or Securities and Exchange Board of India or by any other statutory authority on any matter related tocapital markets during the last three years.

• Whistle Blower Policy

While the Company has not formally established a Whistle Blower Policy as a mechanism for its employees to reportto the Management about any violation of the Company's code of conduct or business principles or unethical behaviour,the employees are free to access the Management or the Audit Committee to report such instances.

• Compliance with mandatory requirements

The Company has complied with the mandatory requirements of Clause 49 of the Listing Agreement as presentlyapplicable. Details of non-mandatory provisions to the extent complied with have been disclosed in this report.

10. Means of Communication

The quarterly and annual financial results are submitted to Bombay Stock Exchange Ltd. immediately on approval by theBoard. The financial results are generally published in one English and one local vernacular language newspapers andare also made available on the website of the Company ‘www.vulcanengineers.com'. Annual Reports are dispatched to allthe shareholders. No presentation was made to the institutional investors or analysts during the year.

11. General Shareholder Information

(a) Annual General Meeting

Date : 30th June, 2014

Time : 3.00 p.m.

Venue : Courtyard by Marriott , "Tulip", Pune City Centre, CTS No.37 & 37/1, Next to Jehangir Hospital, Bund GardenRoad, Pune - 411001.

(c) Date of book closure

23rd June, 2014 to 30th June, 2014 (both days inclusive).

(d) Dividend payment date

Dividend not declared.

(e) Listing on Stock Exchange

The Company's shares are listed on Bombay Stock Exchange Limited. Listing fees to the Bombay Stock ExchangeLimited has been paid for the the year 2014-2015. Your Company would be completing its 25 years of listing with BSEon 26th May, 2014.

(f) Stock Code & ISIN

Stock Code : 522080

ISIN : INE699C01017 with NSDL and CDSL

Particulars Tentative dates

Unaudited results for the quarter ending:

31st March, 2014 By 15th May, 2014.

30th June, 2014 By 14th August, 2014.

30th September, 2014 By 14th November, 2014.

Audited annual results for the year ending 31st December, 2014 By 28th February, 2015

(b) Financial Year : 1st January, 2014 to 31st December, 2014

31

MonthHigh Rs. Low Rs.

BSE Sensex

January, 2013 29.70 22.60 20,203.66 19,508.93

February, 2013 25.90 17.25 19,966.69 18,793.97

March, 2013 19.70 11.50 19,754.66 18,568.43

April, 2013 18.40 12.60 19,622.68 18,144.22

May, 2013 17.75 13.00 20,443.62 19,451.26

June, 2013 19.15 11.90 19,860.19 18,467.16

July, 2013 12.65 9.85 20,351.06 19,126.82

August, 2013 11.40 7.65 19,569.20 17,448.71

September, 2013 9.00 7.72 20,739.69 18,166.17

October, 2013 11.50 8.50 21,205.44 19,264.72

November, 2013 13.20 8.50 21,321.53 20,137.67

December, 2013 12.12 8.57 21,483.74 20,568.70

High Low

Share Price on BSE

(h) Registrar and Share Transfer Agents

Link Intime India Private Limited are the Registrar and Share Transfer Agents for shares held in physical and electronicmode.

Their contact details are:

C-13, Pannalal Silk Mills Compound, L.B.S. Marg,

Bhandup (West), Mumbai 400 078.

In addition, shareholders can directly contact the following person at Link Intime India Private Limited.

Name Telephone No. Fax No. Email ID

Ms. Trupti Parab (022) 25946970 (022) 25946969 [email protected]

(i) Share Transfer Procedure

Shareholders are advised to contact Link Intime India Private Limited directly. Every effort is made to clear sharetransfers / name deletions within 15 days. Requests for transmissions are normally cleared within 21 days andrequests for issue of duplicate share certificates are normally cleared within 42 days, provided the documents are clearin all respects.

(j) Distribution of Shareholding as on 31st December, 2013

No. of Equity Shares heldShare holders Shares

Upto 500 4,073 82.6669 883,813 9.3033

501 to 1000 470 9.5393 370,688 3.9020

1001 to 2000 200 4.0593 293,640 3.0909

2001 to 3000 59 1.1975 149,687 1.5757

3001 to 4000 41 0.8321 149,390 1.5725

4001 to 5000 20 0.4059 92,850 0.9774

5001 to 10000 37 0.7510 254,798 2.6821

10001 and above 27 0.5480 7,305,134 76.8961

Total 4,927 100.0000 9,500,000 100.0000

Nos. Percentage Nos. Percentage

(g) Market Price Data

Monthly high and low quotations as well as the volume of shares traded on the Bombay Stock Exchange Limited andthe Sensex during year 2013 were:

32


(k) Shareholding Pattern as on 31st December, 2013

Category

Promoters 5,480,145 57.69

Mutual Funds and UTI 200 0.00

Banks, Financial Institutions. 900 0.01

Bodies Corporate 2,26,690 2.39

Indian Public 23,99,145 25.25

NRI/OBC/Foreign Companies 13,67,342 14.39

Other (Clearing) 25,578 0.27

Total 9,500,000 100.00

Percentage of

Shareholding

(l) Dematerialization of shares

As on 31st December, 2013, 94.98% of the Company's paid up share capital was held in dematerialized form.

(m) Convertible Instruments

As on 31st December, 2013, the Company does not have any outstanding convertible instruments which are likely tohave an impact on the equity share capital of the Company.

(n) Plant Location

Plot No.B-21, MIDC Industrial Area, Ahmednagar 414 111 (Maharashtra).

Note : Pursuant to the closure of the manufacturing operations at Ahmednagar factory since 1998. Your Board ofDirectors felt that it would be in the interest of the Company, to transfer its lease hold rights in the land and factorybuilding located at Plot no. B-21, MIDC Industrial Area, Ahmednagar and has signed a ‘Memorandum of Understanding'on 27th february 2014, with that effect with a prospective buyer. Since the book value of the above assets, is less than20% of the Company's net worth as on 31st December, 2013, section 180 (1) (a) of the Companies Act, 2013 is notapplicable.

(o) Contact Details Ms. Bela Thakkar, (Company Secretary & Compliance Officer)Vulcan Engineers Limited104,105 & 106, Trade Centre,"C" Wing, First Floor,North Main Road,Koregaon Park,Pune - 411 001.Tel: (020) 66450800Fax: (020) 66450801Email: [email protected]

12. CEO / CFO certification

As required by Clause 49 of the Listing Agreement, Mr. Anand Gadkari - Managing Director, certification is given elsewherein the Annual Report.

13. Compliance

The Company has obtained the certificate from its Statutory Auditors regarding compliance with the provisions relating tocorporate governance laid down in the Clause 49 of the Listing Agreement. The certificate is annexed to this report.

No. of

Shares held

33

AUDITORS' CERTIFICATE ON COMPLIANCE WITH THE CONDITIONS OF CORPORATE

GOVERNANCE AS STIPULATED IN CLAUSE 49 OF THE LISTING AGREEMENT

To the Members ofVulcan Engineers Limited

We have examined the compliance of conditions of Corporate Governance by Vulcan Engineers Limited ("the Company") forthe year ended on 31st December 2013, as stipulated in Clause 49 of the Listing Agreement of the Company with the stockexchange in India.

The compliance of conditions of Corporate Governance is the responsibility of the Company's management. Our examinationwas carried out in accordance with the Guidance Note on Certification of Corporate Governance (as stipulated in Clause 49 ofthe Listing Agreement) issued by the Institute of Chartered Accountants of India and was limited to procedures andimplementation thereof, adopted by the Company for ensuring compliance of the conditions of Corporate Governance. It isneither an audit nor an expression of opinion on the financial statements of the Company.

In our opinion and to the best of our information and according to the explanations given to us, we certify that the Company hascomplied with the conditions of Corporate Governance as stipulated in the above-mentioned Listing Agreement.

We further state that such compliance is neither an assurance as to the future viability of the Company nor the efficiency oreffectiveness with which the management has conducted the affairs of the Company.

FOR SURESH SURANA & ASSOCIATES LLP

Chartered AccountantsICAI Reg. No: 121750W / W-100010

(Vinodkumar Varma)

PARTNER

Membership No. 105545

Place : MumbaiDated : 16th May, 2014

34


To,

The Board of Directors

Vulcan Engineers Limited

Sub : Certificate

(issued in accordance with provisions of Clause 49 of the Listing Agreement)

I, have reviewed the financial statements and the cash flow statement of Vulcan Engineers Limited for the financial year ended

31st December, 2013, and to the best of my knowledge and belief, I state that :

(a) (i) These statements do not contain any materially untrue statement or omit any material fact or contain statements that

may be misleading.

(ii) These statements present a true and fair view of the Company's affairs and are in compliance with current accounting

standards, applicable laws and regulations.

(b) There are to the best of my knowledge and belief, no transactions entered into by the Company during the year which are

fraudulent, illegal or in violation of the Company's code of conduct.

(c) I, accept responsibility for establishing and maintaining internal controls for financial reporting. I have evaluated the

effectiveness of internal control systems of the Company and have disclosed to the Auditors and the Audit Committee,

deficiencies in the design or operation of internal controls, if any, and steps taken or proposed to be taken for rectifying these

deficiencies.

(d) I have indicated to the Auditors and the Audit Committee:

(i) Significant changes in internal control over financial reporting during the year

(ii) Significant changes in accounting policies made during the year and that the same have been disclosed suitably in

the notes to the financial statements; and

(iii) Instances of significant fraud of which I have become aware and the involvement therein, if any, of the management

or an employee having significant role in Company's internal control over financial reporting.

For Vulcan Engineers Limited

Anand Gadkari

Managing Director

Place : Pune

Date : 16th May, 2014

35

INDEPENDENT AUDITOR'S REPORTTo,The Members ofVULCAN ENGINEERS LIMITED

Report on the Financial StatementsWe have audited the accompanying financial statements of Vulcan Engineers Limited ("the Company"), which comprise thebalance sheet as at 31st December 2013, the statement of profit and loss and the cash flow statement for the year then ended,and a summary of significant accounting policies and other explanatory information.

Management's Responsibility for the Financial StatementsManagement is responsible for the preparation of these financial statements that give a true and fair view of the financialposition, financial performance and cash flows of the Company in accordance with the accounting standards referred to in sub-section (3C) of section 211 of the Companies Act, 1956 ('the Act') read with the General Circular 15/2013 dated 13th September2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013. This responsibility includes thedesign, implementation and maintenance of internal control relevant to the preparation and fair presentation of the financialstatements that are free from material misstatement, whether due to fraud or error.

Auditor's ResponsibilityOur responsibility is to express an opinion on these financial statements based on our audit. We conducted our audit inaccordance with the Standards on Auditing issued by the Institute of Chartered Accountants of India. Those Standards requirethat we comply with ethical requirements and plan and perform the audit to obtain reasonable assurance about whether thefinancial statements are free from material misstatement.

An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the financial statements.The procedures selected depend on the auditor's judgment, including the assessment of the risks of material misstatement ofthe financial statements, whether due to fraud or error. In making those risk assessments, the auditor considers internal controlrelevant to the Company's preparation and fair presentation of the financial statements in order to design audit procedures thatare appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the Company'sinternal control. An audit also includes evaluating the appropriateness of accounting policies used and the reasonableness ofthe accounting estimates made by management, as well as evaluating the overall presentation of the financial statements.

We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit opinion.

OpinionIn our opinion and to the best of our information and according to the explanations given to us, the financial statements give theinformation required by the Act in the manner so required and give a true and fair view in conformity with the accountingprinciples generally accepted in India:(a) in the case of the balance sheet, of the state of affairs of the Company as at 31st December 2013;(b) in the case of the statement of profit and loss, of the loss of the Company for the year ended on that date; and(c) in the case of the cash flow statement, of the cash flows of the Company for the year ended on that date.

Emphasis of MatterWe draw attention to note no.36 of the financial statements in regard to amount aggregating to Rs. 45,026,202 due to Holdingcompany which has remained unsettled beyond time period as approved by Reserve Bank of India. Our opinion is not qualifiedin respect of this matter.

Report on Other Legal and Regulatory Requirements1. As required by the Companies (Auditor's Report) Order, 2003 ("the Order"), issued by the Central Government of India in

terms of sub-section (4A) of Section 227 of the Act, we give in the Annexure a statement on the matters specified inparagraphs 4 and 5 of the Order.

2. As required by sub-section (3) of Section 227 of the Act, we report that:a. we have obtained all the information and explanations which to the best of our knowledge and belief were necessary

for the purpose of our audit;b. 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;c. the balance sheet, statement of profit and loss and cash flow Statement dealt with by this Report are in agreement with

the books of account;d. in our opinion, the balance sheet, statement of profit and loss and cash flow statement comply with the Accounting

Standards referred to in sub-section (3C) of Section 211 of the Act), read with the General Circular 15/2013 dated 13th

September 2013 of the Ministry of Corporate Affairs in respect of section 133 of the Companies Act, 2013 ande. on the basis of written representations received from the directors of the Company as on 31 December 2013 and taken

on record by the Board of Directors, none of the directors is disqualified as on 31 December 2013, from beingappointed as a director in terms of clause (g) of sub-section (1) of Section 274 of the Act.

FOR SURESH SURANA & ASSOCIATES LLPChartered AccountantsICAI Registration Number : 121750W / W-100010

(Vinodkumar Varma)PARTNERMembership No. 105545Place: MumbaiDated: 28th February 2014

36


ANNEXURE TO THE AUDITORS' REPORT

[REFERRED TO IN PARAGRAPH 1 UNDER THE HEADING OF REPORT ON OTHER LEGAL AND

REGULATORY REQUIREMENTS OF OUR REPORT OF EVEN DATE]

1. (a) The Company has maintained proper records showing full particulars including quantitative details and situation of itsfixed assets.

(b) All the fixed assets are physically verified by the management according to a phased programme designed to cover allitems over a period of three financial years, which in our opinion, is reasonable having regard to the size of theCompany and the nature of its assets. Pursuant to the programme, a portion of the fixed assets has been physicallyverified by the management during the year and no material discrepancies have been noticed by the management onsuch verification.

(c) During the year, the Company has not disposed off any part of its fixed assets.

2. (a) According to the information and explanation given to us, inventories purchased by the Company from its suppliers aredirectly dispatched to customers. In the absence of any inventory being stocked by the Company, clause 4(ii)(a) and4(ii)(b) of the Order are not applicable to the Company

(b) On the basis of our examination of the inventory records, in our opinion, the Company has maintained proper recordsof inventory.

3. According to information and explanations given to us, the Company has not granted/taken any loan, secured orunsecured, to/from Companies, firms and other parties covered in the Register maintained under Section 301 of the Act.Accordingly, the provisions of clause 4(iii)(b), 4(iii)(c), 4(iii)(d), 4(iii)(f) and 4(iii)(g) of the Order are not applicable to theCompany.

4. In our opinion and according to the information and explanations given to us, there is an adequate internal controlsystem commensurate with the size of the Company and the nature of its business, with regard to purchase of inventoryand fixed assets and for the sale of goods and services. During the course of our audit, we have not observed anycontinuing failure to correct major weaknesses in internal control system.

5. (a) According to the information and explanations given to us, the transactions made in pursuance of contracts orarrangements that need to be entered into the register maintained under Section 301 of the Act have been recorded inthe register.

(b) In our opinion and according to the information and explanations given to us, the transactions made in pursuance ofsuch contracts or arrangements entered in the register maintained under Section 301 of the Act have been made atprices which are reasonable having regard to prevailing market prices at the relevant time.

6. According to the information and explanations given to us, the Company has not accepted any deposits from the publicwithin the meaning of Sections 58A and 58AA of the Act and the rules framed thereunder during the year.

7. In our opinion, the Company has an internal audit system commensurate with its size and the nature of its business.

8. According to the information and explanations given to us, the Central Government has not prescribed maintenance ofcost records under Section 209(1)(d) of the Act in the case of the Company.

9. (a) According to the information and explanation given to us, the Company has been generally regular in depositing theundisputed statutory dues including provident fund, investor education and protection fund, employees' state insurance,income tax, sales tax, wealth tax, service tax, custom duty, excise duty, cess and other material statutory dues asapplicable with the appropriate authorities. No undisputed amounts payable in respect of aforesaid statutory dues wereoutstanding as on the last day of the financial year for a period of more than six months from the date they becamepayable.

(b) According to the information and explanations given to us, there are no dues on account of income tax, sales tax, servicetax, customs duty, wealth tax, excise duty and cess, which have not been deposited on account of any dispute.

37

10. The accumulated losses of the Company at the end of the financial year are more than fifty percent of its net worth andthe Company has incurred cash loss during the current financial year and in the immediately preceding financial year.

11. According to the information and explanations given to us, the Company has not defaulted in repayment of dues to thebanks. The Company does not have any borrowings from financial institutions and by way of debentures.

12. According to the information and explanation given to us, the Company has not granted any loans and advances on thebasis of security by way of pledge of shares, debentures and other securities.

13. According to the information and explanations given to us, the Company is not a chit fund or a nidhi / mutual benefit fund/ society. Accordingly, the provisions of clause 4(xiii) of the Order are not applicable to the Company.

14. According to the information and explanations given to us, the Company is not dealing or trading in shares, securities,debentures and other investments. Accordingly, the provisions of clause 4(xiv) of the Order are not applicable to theCompany.

15. According to the information and explanations given to us, the Company has not given any guarantee for loan taken byothers from banks or financial institutions during the year.

16. According to the information and explanations given to us, the Company has not taken any term loan during the year.

17. According to the information and explanations given to us and on an overall examination of the balance sheet of theCompany, in our opinion, as at 31st December 2013, funds raised on short term basis have not been used for long terminvestments.

18. The Company has not made preferential allotment of shares to the parties or companies covered in the registermaintained under Section 301 of the Act during the year.

19. The Company has not issued any debentures during the year.

20. The Company has not raised any money by way of public issue during the year.

21. During the course of our examination of the books and records of the Company carried out in accordance with thegenerally accepted auditing practices in India, and according to the information and explanation given to us, we haveneither come across any instances of fraud on or by the Company, noticed or reported during the year, nor have we beeninformed of any such cases by the management

FOR SURESH SURANA & ASSOCIATES LLP

Chartered AccountantsICAI Reg. No. 121750W / W-100010

(Vinodkumar Varma)PARTNERMembership No. 105545Place: MumbaiDated: 28th February 2014

38


I EQUITY AND LIABILITIES

1 Shareholders’ funds

Share capital 2 95,000,000 95,000,000

Reserves and surplus 3 (75,760,880) 2,504,307

19,239,120 97,504,307

2 Non-current liabilities

Long-term provisions 4 3,064,701 3,245,685

3,064,701 3,245,6853 Current liabilities

Short-term borrowings 5 46,099,374 47,388,410

Trade payables 6 42,961,052 39,395,760

Other current liabilities 7 87,450,652 75,894,585

Short-term provisions 8 9,818,904 5,169,771

186,329,982 167,848,526

TOTAL 208,633,803 268,598,518

II ASSETS

1 Non-current assets

Fixed assets 9

(i) Tangible assets 61,850,357 62,475,543(ii) Intangible assets 959,803 1,369,217

Deferred tax assets (net) 10 - 28,288,516

Long-term loans and advances 11 4,399,967 5,255,635

Other non-current assets 12 1,975,029 5,590,973

69,185,156 102,979,884

2 Current assets

Inventories 13 741,920 702,813

Trade receivables 14 55,160,581 101,379,055

Cash and bank balances 15 15,271,075 11,168,101

Short-term loans and advances 16 35,122,514 24,429,719

Other current assets 17 33,152,557 27,938,946

139,448,647 165,618,634

TOTAL 208,633,803 268,598,518

Significant accounting policies 1

As per our report of even date attached FOR AND ON BEHALF OF THE BOARD OF DIRECTORS

FOR SURESH SURANA & ASSOCIATES LLP DANIELE TERRUZZI Chairman


(Vinodkumar Varma) RANGANATH DESAI Executive Director - Finance

PARTNER

Membership No.: 105545 BELA THAKKAR Company Secretary

Mumbai, Dated : 28th February 2014 Mumbai, Dated : 28th February 2014

Note As at As atNo. 31/12/2013 31/12/2012

(Rs.) (Rs.)

BALANCE SHEET AS AT 31 DECEMBER 2013

Particulars

The accompanying notes are an integral part of the financial statements

39

STATEMENT OF PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31 DECEMBER 2013

I Revenue from operations

Gross sales 46,388,235 64,347,432

Less: Excise duty - -

Net sales 46,388,235 64,347,432

Engineering and service income 75,349,899 45,232,217

121,738,134 109,579,649

II Other income 18 1,584,615 1,750,155

III Total revenue ( I + II ) 123,322,749 111,329,804

IV Expenses :

Purchases of materials and components 28,238,373 44,974,283

Changes in inventories of traded goods and work in progress 19 (39,107) (702,813)

Employees' benefit expenses 20 29,254,817 31,671,587

Finance costs 21 5,565,340 4,156,807

Depreciation and amortisation expenses [Net of transfer from

revaluation reserve Rs. 18,240 (previous year Rs. 18,240)] 1,160,524 987,779

Other expenses 22 102,366,368 73,876,457

Total expenses 166,546,315 154,964,100

V Loss before exceptional items and tax ( III - IV ) (43,223,566) (43,634,296)

VI Exceptional items- Expense / (income) 23 6,868,784 -

VII Loss before tax ( V-VI ) (50,092,350) (43,634,296)

VIII Tax expenses:

Deferred tax (expenses) / benefits (28,288,516) 12,788,466

Prior period tax adjustment 133,919 -

IX Loss for the year ( VII + VIII ) (78,246,947) (30,845,830)

X Earnings / (Loss) per equity share:

(1) Basic (8.24) (3.25)

(2) Diluted (8.24) (3.25)

Nominal value of equity shares 10.00 10.00

Significant accounting policies 1

Note Current Year Previous YearNo. 2 0 1 3 2012

(Rs.) (Rs.)

Particulars





PARTNER




40


A. CASH FLOW FROM OPERATING ACTIVITIES :Net loss before tax (50,092,350) (43,634,296)ADJUSTMENTS FOR :

Depreciation and amortisation expenses 1,160,524 987,779Finance costs 5,565,340 4,156,807Loss on sale of fixed assets (net) - 576,019Sundry balances written off/ (written back) (net) (70,511) (93,615)Exchange rate difference (net) 10,438,053 3,123,490Interest income (1,434,455) (1,332,265)

15,658,951 7,418,215

Operating loss before working capital changes (34,433,399) (36,216,081)

ADJUSTMENTS FOR WORKING CAPITAL CHANGES:

(Increase)/ decrease in trade receivables 45,012,732 22,618,837(Increase)/ decrease in loans and advances (10,944,724) (2,545,540)(Increase)/ decrease in other current assets (4,353,764) (24,963,743)(Increase) / decrease in inventories (39,107) (702,813)Increase/ (decrease) in trade payables and other liabilities 10,779,322 21,642,114

40,454,459 16,048,855

Cash flow generated from/(used in) operations 6,021,060 (20,167,226)Taxes paid 886,723 1,599,119

Net cash generated from/(used in) operating activities 6,907,783 (18,568,107)

B. CASH FLOW FROM INVESTING ACTIVITIES :

Purchase of tangible / intangible assets 210,629 (913,751)Sale proceeds from tangible assets - 280,000Decrease in capital advance (354,793) -Interest received 1,083,816 1,546,629(Investments) in / maturity of bank deposits with banks (385,498) 2,235,067

Net cash generated from investing activities 554,154 3,147,945

C. CASH FLOW FROM FINANCING ACTIVITIES :

Borrowings / Repayments (net) (1,289,036) 18,916,690Interest paid (5,565,340) (4,156,807)

Net cash generated from/(used in) financing activities (6,854,376) 14,759,883

Net increase/(decrease) in cash and cash equivalents (A+B+C) 607,561 (660,279)

Cash and cash equivalent at beginning of year 1,392,688 2,052,967Cash and cash equivalent at end of year 15 2,000,249 1,392,688

Net increase/ (decrease) in cash and cash equivalents 607,561 (660,279)

Cash and cash equivalents comprise of:Cash and bank balances 2,003,428 1,392,688Unrealised exchange difference at year end (3,179) -

Total Cash and cash equivalent at end of year 2,000,249 1,392,688Significant accounting policies 1

Note Current Year Previous YearNo. 2013 2012

(Rs.) (Rs.) (Rs.) (Rs.)

CASH FLOW STATEMENT FOR THE YEAR ENDED 31 DECEMBER 2013

Particulars





PARTNER




41

1 SIGNIFICANT ACCOUNTING POLICIES

a) Basis of accounting:

The financial statements have been prepared in compliance with all material aspects of the Accounting Standards

prescribed in the Companies (Accounting Standards) Rules, 2006 issued by the Central Government, to the extent

applicable.

These accounts are prepared on historical cost convention (except certain fixed assets which are at revalued amounts)

and on the accounting principle of going concern basis.

The Company follows mercantile system of accounting and recognizes income and expenditure on accrual basis

except those with significant uncertainties.

b) Use of estimates:

The preparation of financial statements in conformity with generally accepted accounting principles (GAAP) requires

management to make estimates and assumptions that affects the reported amounts of assets and liabilities and the

disclosures of contingent liabilities on the date of financial statements and reported amounts of revenue and expenses

for that year. Although these estimates are based upon management's best knowledge of current events and actions,

actual results could differ from these estimates.

c) Fixed assets:

Fixed assets are stated at cost of acquisition (which includes freight, duties, taxes and incidental expenses) or at

revalued amount (wherever the assets are revalued) less accumulated depreciation.

Computer software, where it is expected to provide future enduring economic benefits is capitalised. The capitalised

cost includes license fees and cost of implementation / system integration services.

d) Depreciation and amortization:

Depreciation on assets is provided on straight-line method on pro-rata basis at the rates and in the manner specified

in Schedule XIV of the Companies Act, 1956. The value of leasehold land is amortised over the period of the lease and

sheds and portable units are amortised over a period of 12.5 years.

Capitalised software costs are amortised on straight line method over their useful lives as estimated by management.

e) Revenue recognition:

Revenue in respect of sale of goods is recognised when significant risk and rewards of ownership are transferred to

the customers.

Revenue from construction contracts is recognised on the percentage of completion method, measured by the

proportion that contract costs incurred for work performed till the reporting date bear to the estimated total contract

cost. Contract cost for this purpose includes:

a) Costs that relate directly to the specific contract;

b) Costs that are attributable to contract activity in general and can be allocated to the contract: and

c) Such other costs as are specifically chargeable to the customer under the terms of contract.

Foreseeable losses, if any, are provided for immediately.

Revenue from services is recognised on accrual basis as per terms of the contractual agreement.

f) Inventories:

Material and components are valued at lower of cost or net realisable value. Cost is ascertained on first-in first-out

(FIFO) basis.

NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 31 DECEMBER 2013

42


g) Foreign currency transactions:

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

assets and liabilities as at the Balance Sheet date are translated at the rates of exchange prevailing at the date of the

Balance Sheet. Gains and losses arising on account of differences in foreign exchange rates on settlement/ translation

of monetary assets and liabilities are recognised in the statement of profit and loss. Non-monetary foreign currency

items are carried at cost.

h) Retirement benefits:

Provident fund contributions payable are charged to statement of profit and loss.

Liability for accumulated leave is provided on the basis of actuarial valuation as at the year-end.

Liability for gratuity is provided on the basis of actuarial valuation as at the year end and funded with Life Insurance

Corporation of India.

i) Lease:

Leases where the lessor effectively retains substantially all the risks and benefits of the lease term are classified as

operating leases. Lease rentals in respect of properties acquired under operating leases are charged off to the

statement of profit and loss as incurred.

j) Accounting for taxes on income:

Tax expenses comprises of current tax and deferred tax.

Current tax represents tax on profits for the current year as determined as per the provisions of the Income Tax Act,

1961.

The deferred tax for timing differences between the book and tax profits for the year are accounted based on tax rates

in force and tax laws that have been enacted or substantively enacted as of the balance sheet date. Deferred tax assets

arising from timing differences, are recognised to the extent there is reasonable / virtual certainty that these would be

realized in future and are reviewed for the appropriateness of their respective carrying values at each balance sheet

date.

k) Accounting for provisions and contingent liabilities:

A provision is made when there is a present obligation as a result of a past event that probably requires an outflow of

resources and a reliable estimate can be made of the amount of the obligation. Provisions are not discounted to its

present value and are determined based on best estimate required to settle the obligation at the balance sheet date.

A disclosure for a contingent liability is made when there is a possible obligation or a present obligation that may, but

probably will not, require an outflow of resources. Where there is a possible obligation or a present obligation in

respect of which the likelihood of outflow of resources is remote, no provision or disclosure is made.

l) Impairment of assets:

The Company assesses, at each balance sheet date, whether there is any indication that an asset may be impaired.

If any such indication exists, the management estimates the recoverable amount of the asset. If such recoverable

amount of the asset is less than its carrying amount, the carrying amount is reduced to its recoverable amount. The

reduction is treated as an impairment loss and recognised in the statement of profit and loss. If, at the balance sheet

date, there is an indication that a previously assessed impairment loss no longer exists, the recoverable amount is

reassessed and the asset is reflected at the recoverable amount, subject to a maximum of depreciated historical cost.

m) Earnings per share

The basic earnings per share (EPS) is computed by dividing the net profit or loss after tax for the year available for the

equity shareholders by the weighted average number of equity shares outstanding during the year. For the purpose of

calculating diluted earnings per share, net profit or loss after tax for the year available for equity shareholders and the

weighted average number of shares outstanding during the year are adjusted for the effects of all dilutive potential

equity shares.


43

As at As at31/12/2013 31/12/2012

(Rs.) (Rs.)


Authorised

11,000,000 equity shares of Rs.10 each 110,000,000 110,000,000

Issued, subscribed and paid up

9,500,000 (as at 31 December 2012: 9,500,000) equity shares of Rs.10 each, 95,000,000 95,000,000 fully paid up

(Of the above 5,480,145 equity shares are held by Terruzzi Fercalx SpA,the holding company.)

Total 95,000,000 95,000,000

Notes:a) Reconciliation of the number of shares outstanding at the beginning and at the end of the reporting year:

Shares outstanding at the beginning of the year 95,000,000 950,000,000 95,000,000 950,000,000

Shares issued during the year - - - -

Shares outstanding at the end of the year 95,000,000 950,000,000 95,000,000 950,000,000

As at 31/12/2013 As at 31/12/2012

No. of shares Rs. No. of shares Rs.Particulars

b) Terms/ rights attached to equity shares

The Company has only one class of equity shares having a par value of Rs.10 per share. Each holder of equity sharesis entitled to one vote per share. The dividend, if any, proposed by the Board of Directors is subject to approval of theshareholders in ensuing Annual General Meeting. During the year ended 31st December 2013, the Company has notdeclared any dividend (year ended 31st December 2012 : Nil)

In the event of liquidation of the Company, the holders of the equity shares will be entitled to receive remaining assetsof the Company, after distribution of all preferential amounts, if any. The distribution will be in proportion to the numberof equity shares held by the shareholders.

c) Details of shareholders holding more than 5 percent equity shares in the Company:

Terruzzi Fercalx SpA 5,480,145 57.69% 5,480,145 57.69%

Societa Italiana Per Le Imprese All'Estero - 1,310,000 13.79% 1,310,000 13.79%

SIMEST SpA (SIMEST)

As at 31/12/2013 As at 31/12/2012

No. of shares

held

% of holding No. of sharesheld

% of holdingName of shareholder

2 SHARE CAPITAL

d) The Company has not issued any share for consideration other than cash or bonus shares nor any share has

been bought back during the five years preceding the balance sheet date.

Particulars

44


As at As at31/12/2013 31/12/2012

(Rs.) (Rs.)

Securities premium account 52,840,000 52,840,000

Revaluation reserve

Opening balance 474,581 492,821

Less : Transfer to statement of profit and loss for depreciation on account of 18,240 18,240

increase in value of fixed assets due to revaluation

Closing balance 456,341 474,581

Surplus / (Deficit)

Opening balance (50,810,274) (19,964,444)

Add: Profit / (loss) for the year (78,246,947) (30,845,830)

Closing balance (129,057,221) (50,810,274)

Total (75,760,880) 2,504,307

3 RESERVES AND SURPLUS


As at As at31/12/2013 31/12/2012

(Rs.) (Rs.)

Provision for employee benefits

Gratuity (funded) 1,934,779 2,281,738

Compensated absences (unfunded) 1,129,922 963,947

Total 3,064,701 3,245,685

4 LONG TERM PROVISIONS

As at As at31/12/2013 31/12/2012

(Rs.) (Rs.)

Unsecured

Bank overdraft (repayable on demand) 46,099,374 47,388,410

[Bank overdraft against standby letter of credit issued by bankers of the holdingcompany and carries interest @ 11.50% p.a. (previous year @ 11.25-11.50% p. a.)]

Total 46,099,374 47,388,410

5 SHORT TERM BORROWINGS

Particulars

Particulars

Particulars

45

As at As at31/12/2013 31/12/2012

(Rs.) (Rs.)

Due to holding company 11,447,747 7,436,197

Other trade payables 31,513,305 31,959,563

Total 42,961,052 39,395,760

6 TRADE PAYABLES


As at As at31/12/2013 31/12/2012

(Rs. ) (Rs.)

Due to holding company (refer note 36) 45,026,202 39,990,952

Creditors for fixed assets 9,820 44,940

Advances received from customers 38,590,717 30,678,708

[Includes advances received from Terruzzi Fercalx SpA: Rs.32,162,676

(as at 31 December 2012: Rs 23,534,508) and advances received from Terruzzi

Fercalx SpA - India Project Office Rs 2,500,000 (as at 31 December 2012:

Rs. 3,500,000)]

Employees' dues 3,326,847 4,094,675

Statutory dues 497,066 865,203

Other current liabilities - 220,107

Total 87,450,652 75,894,585

7 OTHER CURRENT LIABILITIES

As at As at31/12/2013 31/12/2012

(Rs.) (Rs.)

Provision for

Compensated absences (unfunded) 308,387 413,730

Expected loss on projects 9,510,517 4,756,041

Total 9,818,904 5,169,771

8 SHORT TERM PROVISIONS

Note: The Company has not received any information from its suppliers regarding their registration under the ‘Micro, Smalland Medium Enterprises Development Act, 2006’. Hence, interest if any payable as required under the Act has not beenprovided and the information required to be given in accordance with Section 22 of the said Act, is not ascertainable andhence, not disclosed.

Particulars

Particulars

Particulars

46


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47

Gross block (at cost)

As at 1 January 2012 2,525,685 2,525,685

Additions - -

Disposals - -

As at 31 December 2012 2,525,685 2,525,685

Additions - -

Disposals - -

As at 31 December 2013 2,525,685 2,525,685

Amortisation

As at 1 January 2012 747,054 747,054

For the year 409,414 409,414

On disposals - -

As at 31 December 2012 1,156,468 1,156,468

For the year 409,414 409,414

On disposals - -

As at 31 December 2013 1,565,882 1,565,882

Net Block

As at 31 December 2012 1,369,217 1,369,217

As at 31 December 2013 959,803 959,803

9 FIXED ASSETS

B) INTANGIBLE ASSETS


Particulars

Computer

software

(Rs.)

Total

(Rs.)

As at As at31/12/2013 31/12/2012

(Rs.) (Rs.)

Deferred tax assets on account of:

Expenses allowable on payment basis 1,287,846 1,378,171

Carried forward business loss 30,801,308 21,414,176

Unabsorbed depreciation 6,093,804 5,909,232

Provision for expected loss on projects 2,938,749 214,081

Disallowances under section 40(a)(ia) of the Income Tax Act,1961 7,881 7,881

Total (A) 41,129,588 28,923,541

Less: Deferred tax liability on account of:

Depreciation 499,651 635,025

Total (B) 499,651 635,025

Deferred tax assets (net) (A-B) 40,629,937 28,288,516

10 DEFERRED TAX ASSETS (NET)

Major components of deferred tax assets and liabilities, arising on account of timing differences are as under:

Particulars

As there appears to be no virtual certainty of future taxable income as stipulated by Accounting standard (AS) - 22 "Accountingfor Taxes on Income", against which deferred tax asset can be used, deferred tax asset as at 31st December 2013, has notbeen recognised. Also deferred tax assets (net) recognised upto 31st December 2012 has been derecognised.

48


As at As at31/12/2013 31/12/2012

(Rs.) (Rs.)

Advance tax (net of provision) 3,450,669 4,203,473

Capital advances - 354,793

Security deposits 852,969 697,369

Prepaid expenses 96,329 -

Total 4,399,967 5,255,635

11 LONG TERM LOANS AND ADVANCES

(Unsecured, considered good)


Particulars

As at As at31/12/2013 31/12/2012

(Rs.) (Rs.)

Fixed deposits (Refer note 15) 1,965,432 5,072,168

Interest accrued on above fixed deposits 9,597 518,805

Total 1,975,029 5,590,973

12 OTHER NON CURRENT ASSETS

Particulars

As at As at31/12/2013 31/12/2012

(Rs.) (Rs.)

Traded goods 741,920 702,813

Total 741,920 702,813

13 INVENTORIES

(As taken, valued and certified by the management)

Particulars

As at As at31/12/2013 31/12/2012

(Rs.) (Rs.)

Outstanding for a period exceeding six months from the date they are 17,733,917 63,900,239

due for payment

Other debts 37,426,664 37,478,816

Total 55,160,581 101,379,055

Note:

Trade receivables includes amounts due from related parties as under:

Terruzzi Fercalx SpA - India Project Office 16,477,602 85,993,346

Terruzzi Fercalx SpA 23,755,124 297,394

40,232,726 86,290,740

14 TRADE RECEIVABLES


Particulars

49

As at As at31/12/2013 31/12/2012

(Rs.) (Rs.)

Cash and cash equivalents:

Balances with banks

-In current account 1,797,262 1,269,843

Cash on hand 206,166 122,845

2,003,428 1,392,688

Other bank balances:

Fixed deposits (pledged with banks)* 15,233,079 14,847,581

17,236,507 16,240,269

Less: Fixed deposits non-current 1,965,432 5,072,168

(Refer note 12)

Total 15,271,075 11,168,101

15 CASH AND BANK BALANCES


Particulars

*Fixed deposits, include deposits agregating to Rs.7,037,600 (As at 31 December 2012: Rs. 4,125,884) which have anoriginal maturity of more than 12 months.

As at As at31/12/2013 31/12/2012

(Rs.) (Rs.)

Security deposits 1,659,920 1,528,660

Loans and advances to employees 201,136 558,939

Advances to suppliers 22,221,462 16,951,516

Prepaid expenses 788,295 666,103

Balances with government authorities:

VAT credit / receivable 3,320,607 3,574,232

Service tax credit receivable 6,901,855 1,121,030

Balance with central excise and customs 29,239 29,239

Total 35,122,514 24,429,719

16 SHORT-TERM LOANS AND ADVANCES


Particulars

As at As at31/12/2013 31/12/2012

(Rs.) (Rs.)

Unbilled revenue 32,015,733 27,661,969

Interest accrued on fixed deposits 1,136,824 276,977

Total 33,152,557 27,938,946

17 OTHER CURRENT ASSETS


Particulars

50


Interest income

- on fixed deposits 1,434,455 1,332,265

- on income tax refund - 178,088

- on others 21,921 7,653

Sundry balances written back (net) 70,511 93,615

Miscellaneous income 57,728 138,534

Total 1,584,615 1,750,155

18 OTHER INCOME


Particulars

Opening stock 702,813 -

Closing stock (741,920) (702,813)

(Increase) / decrease (39,107) (702,813)

19 CHANGES IN INVENTORIES OF STOCK-IN-TRADE

Particulars

Salaries, bonus and allowances 27,088,623 29,136,165

Contributions to provident and other funds 1,280,823 1,158,278

Gratuity expenses 389,874 759,735

Staff welfare expenses 495,497 617,409

Total 29,254,817 31,671,587

20 EMPLOYEES' BENEFIT EXPENSES

Particulars

Current year

2013

(Rs.)

Previous year 2012 (Rs.)

Current year

2013

(Rs.)


Current year

2013

(Rs.)


51

Interest expense

- on bank overdraft 5,301,619 4,044,038

- on income tax 231,296 -

- others 32,425 112,769

Total 5,565,340 4,156,807

21 FINANCE COSTS


Particulars

Rent 4,689,424 4,611,316

Rates and taxes 502,786 665,992

Electricity and water charges 781,673 1,031,815

Engineering and labour charges 61,092,971 35,865,061

Insurance charges 1,553,215 1,331,414

Repairs and maintenance

Building 514,800 514,800

Others 904,453 761,784

Security charges 694,998 451,206

Legal and professional charges 5,062,640 7,124,915

Directors sitting fees 230,000 226,500

Payments to auditors

- audit fees 354,216 351,973

- for taxation matters 89,888 190,034

- for other services 23,948 28,912

Printing and stationery 638,681 938,458

Bank charges and commission 428,814 1,112,862

Postage and telephone charges 1,645,042 1,832,842

Travelling and conveyance 7,403,783 8,213,477

Exchange rate difference (net) 11,177,988 4,017,927

Freight and forwarding expenses 3,696,398 2,949,724

Loss on sale of fixed assets (net) - 576,019

Miscellaneous expenses 880,650 1,079,426

Total 102,366,368 73,876,457

22 OTHER EXPENSES

Particulars

Current year

2013

(Rs.)


Current year

2013

(Rs.)


52



23 Exceptional item comprises of claim paid to an ex-employee as per settlement agreement dated 25st April 2013 ofRs. 4,678,293 and reimbursement of legal cost of Rs. 2,190,491.

24 CONTINGENT LIABILITIES (TO THE EXTENT NOT PROVIDED FOR)

a) Claims against Company not acknowledged as debts - 8,660,591

b) Guarantees given by banker to various customers for performance and other 11,047,472 11,672,642

contingencies for which the Company has given counter guarantee to the bank.

As at

31/12/2013

(Rs.)

As at31/12/2012

(Rs.)

Description of contingent liabilities:

Contingent liabilitySr.

No.Brief description

1. Claims not acknowledged as debt Arbitration application filed against the Company by one of its ex-employee.

2. Guarantees given by the bank As a part of its operation, the Company has given bank guaranteesto its customers. Guarantees generally represent irrevocableassurances that the Company will make payment in the event theCompany fails to fulfill its performance or financial obligations.

25 DETAILS OF INVENTORY OF MATERIALS AND COMPONENTS

Particulars

Opening

InventoryPurchases Sales

Closing

Inventory

( R s . ) ( R s . ) ( R s . )

1 Combustion equipments 70,286 1,652,200 3,087,620 70,286

(--) (9,543,600) (19,171,583) (70,286)

2 Electrical equipments -- 2,039,861 1,523,785 671,634

(--) (9,858,741) (11,159,308) (--)

3 Electrical Spares -- 278,460 311,500 --

(--) (285,200) (407,766) (--)

4 Instruments -- -- -- --

(--) (1,455,450) (1,901,534) (--)

5 Mechanical equipments 632,527 9,794,838 15,862,530 --

(--) (13,681,922) (17,972,490) (632,527)

6 Mechanical spares -- 1,116,339 2,618,976 --

(--) (2,878,591) (3,963,466) (--)

7 Fabricated structures & piping -- 11,124,773 19,893,882 --

(--) (6,318,465) (9,076,490) (--)

8 Refractory and insulation -- 1,906,411 2,882,089 --

(--) (660,611) (673,015) (--)

9 Others -- 325,491 207,853 --

(--) (291,703) (21,780) (--)

Total 702,813 28,238,373 46,388,235 741,920

(--) (44,974,283) (64,347,432) (702,813)

( R s . )

Note: Figures in brackets are corresponding figures for previous year.

Sr.

No.

53

Current year Previous year2013 2012(Rs.) Rs.

26 C.I.F. VALUE OF IMPORTS:

Materials and components 2,979,200 1,699,711

27 EXPENDITURE IN FOREIGN CURRENCY:

Foreign travel expenses 2,728,599 3,436,128

Engineering and labour charges -- 2,819,095

Bank charges 5,489 33,661

28 EARNINGS IN FOREIGN CURRENCY:

FOB value of goods exported 36,806,478 36,703,384

Engineering and service charges 58,158,451 865,036


Gratuity (funded)

Current year

2013

(Rs.)


I Components of employer expenses recognized in

the statement of profit and loss:

1 Current service costs 623,091 459,115

2 Interest on defined benefit 291,514 276,586

3 Expected return on plan assets (89,777) (130,264)

4 Past service costs -- --

5 Actuarial losses/(gains) (434,954) 154,298

6 Total expense recognised in the statement of profit and loss 389,874 759,735

I I Actual returns for the year end 82,034 182,548

III Net asset / (liability) recognised in Balance Sheet as at year end

1 Present value of defined benefit obligations (2,810,473) (3,965,855)

2 Fair value of plan assets 875,694 1,684,117

3 Status [surplus/(deficit)] -- --

4 Unrecognised past service costs -- --

5 Net asset / (liability) recognised in Balance Sheet (1,934,779) (2,281,738)

IV Change in defined benefit obligations (DBO) during the year end

1 Present value of DBO at the beginning of year 3,965,855 3,738,379

2 Current service costs 623,091 459,115

3 Interest cost 291,514 276,586

4 Actuarial (gains)/ losses (442,697) 206,582

5 Past service costs -- --

6 Benefits paid (1,627,290) (714,807)

7 Present value of DBO at the end of the year 2,810,473 3,965,855

V Change in fair value of assets during the year

1 Plan assets at the beginning of the year 1,684,117 2,216,376

2 Expected return on plan assets 89,777 130,264

3 Actuarial gains/(losses) (7,743) 52,284

4 Contributions by employers 736,833 --

5 Benefits paid (1,627,290) (714,807)

6 Plan assets at the year end 875,694 1,684,117

Particulars

29 DISCLOSURES IN ACCORDANCE WITH AS-15 (REVISED) PERTAINING TO DEFINED BENEFIT PLANS:

54


Ultimate holding company Terruzzi Fercalx Finanziaria S.r.l (upto 19 December 2012)

Holding Company Terruzzi Fercalx S.p.A

Enterprise under common control Terruzzi Fercalx S.p.A - India Project Office

Key management personnel Mr. Ranganath Desai (Executive director with effect from 22 February 2012)

Mr. Anand Gadkari (Chief Executive officer with effect from 14 January 2013)

Notes:

1. The related party relationships have been determined by the management on the basis of the requirements of theAccounting Standard (AS) - 18 "Related Party Disclosures" and the same have been relied upon by the auditors.

2. The relationships, as mentioned above, pertain to those parties with whom transactions have taken place duringthe year, except where control exists.

Gratuity (funded)

Current year

2012

(Rs.)


Particulars


Notes:

1) Secondary segments are identified by the management as per the requirements of Accounting Standard (AS) - 17'Segment Reporting" taking into account the organisation structure as well as the differing risks and returns.

2) The segment revenue and assets include revenue and assets, which are identifiable with each segment and amountallocated to the segments on a reasonable basis.

3) Figures in brackets are corresponding figures for the previous year.

31 RELATED PARTY DISCLOSURES

I Related party relationship:

30 SEGMENT REPORTING

The Company has only one reportable business segment viz. engineering goods & services, which is being considered asthe primary segment. Disclosures as to the secondary segment, i.e. 'Geographical Segments' are given below:

Outside India

Rs.

Within India

Rs.

Total

Rs.

1. Segment revenueSales and income from operations 94,964,929 26,773,205 121,738,134

(37,568,420) (72,011,229) (109,579,649)2 . Carrying amount of assets by geographical

location of assetsSegment assets 24,540,117 180,643,017 205,183,134

(1,135,257) (234,971,272) (236,106,529)

3 . Additions to fixed assetsAddition to fixed assets - - 144,164 144,164

(--) (558,958) (558,958)

VI Actuarial assumptions

1 Discount rate (%) 8.10% 8.20%

2 Expected return on plan assets (%) 7.50% 7.50%

3 Rate of increase in compensation level (%) 10.00% 10.00%

4 Retirement age (Year) 65 60

5 Mortality table (L.I.C) 2006-2008 1994-1996

VII Major Category of Plan Assets as a % of the total plan assets

as at year end

1 Government securities/Special deposits with RBI -- --

2 High quality corporate bonds -- --

3 Insurance companies 100% 100%

4 Mutual funds -- --

5 Cash and cash equivalents -- --

55

II Transactions with related parties:


32 LEASES

The Company has taken office premises and residential flats under operating lease that are renewable on a periodic basisat the option of both the lessor and lessee. The period of lease ranges from 11 months to 36 months and are cancelable innature, except agreement in respect of office premises which have a lock in period of 24 months. The future minimum leasepayments as per the operating leases under non-cancellable lease terms are as follows:

Particulars Current year 2013

(Rs.)


Terruzzi Fercalx S.p.A.

Sale of goods 34,145,101 36,053,563

Engineering and service charges income 58,211,322 27,172

Purchase of goods 2,979,200 1,059,500

Payment made on behalf of the Company 2,541,834 5,508,450

Expenses incurred by Company and recovered 1,351,627 --

Terruzzi Fercalx S.p.A. - India Project Office

Sale of goods 6,132,351 23,265,411

Expenses incurred by Company and recovered 278,074 370,093

Mr. Ranganath Desai

Salary, bonus and allowances 2,220,010 1,893,847

Mr. Anand Gadkari

Salary, bonus and allowances 2,077,398 --

Balances as at the year end:

Terruzzi Fercalx S.p.A.

Payable 88,636,625 70,961,657

Receivable 23,755,124 297,394

Terruzzi Fercalx S.p.A. - India Project Office

Advances received 2,500,000 3,500,000

Receivable 16,477,602 85,993,346

Mr. Ranganath Desai - Payable 141,550 -

Mr. Anand Gadkari - Payable 123,933 -

The amount of minimum lease payments with respect to the above lease recognized in the statement of profit and loss forthe year is Rs. 2,558,439 (previous year: Rs. Nil).

33 The Company is required to comply with the transfer pricing regulations under Section 92-92F of The Income Tax-Act,1961. The management is of the opinion that its international transactions are at arms length and that the aforesaidlegislation will not have any impact on the financial statements, particularly on the amount of tax expense and that ofprovision for taxation.

34 EARNINGS / (LOSS) PER SHARE

Current Year 2013 Previous Year 2012

(i) Net loss after tax attributable to equity shareholders (Rs.) (78,246,947) (30,845,830)

(ii) Weighted average number of equity shares outstanding at theyear end (Nos.) 9,500,000 9,500,000

(iii) Basic and diluted loss per share (Rs.) (8.24) (3.25)

(iv) Nominal value of share (Rs.) 10.00 10.00

Particulars

Particulars Current year 2013

(Rs.)


Not later than one year 2,376,000 NIL

Later than one year and not later than five years 2,593,800 NIL

Later than five years NIL NIL

56


35 Details of foreign currency exposures which are not hedged as at year end are as follows:

ParticularsAmount in Foreign Currency

In Euros In USD

Equivalentamount in Rs.*

Cash in hand -- 390 95 28,755(--) (--) (--) (--)

Trade receivables 259,096 -- -- 22,106,103(--) (--) (--) (--)

Other current assets 9,201 -- -- 784,993(11,564) (--) (--) (837,863)

Trade payables 134,174 -- 11,447,747(102,625) (--) (--) (7,436,197)

Other current liabilities - Due to holding company -- 727,637 -- 45,026,202(--) (727,637) (--) (39,990,952)

Other current liabilities - Advances received from 376,965 -- -- 32,162,677customers (324,793) (20,925) (--) (24,684,546)

Other

Figures in bracket are corresponding figures for the previous year.

* As at year end exchange rates.

36 In respect of import transaction of the Company, Terruzzi Fercalx S.p.A., the holding company had made payment to thesupplier aggregating to USD 727,637 (as at 31/12/2013 Rs. 45,026,202) after the Company has received Reserve Bankof India (RBI) approval.

The same is disclosed under "Other Current Liability" as "Due to Holding company". As the Company could not remit thefunds to its holding company within the time allowed by RBI, the Company has sought extension of time for remittance fromRBI and received such extension from time to time. Latest extension was received vide RBI letter dated 22 November 2012for a period of two months from the date of receipt of the letter by the Company. However, the Company could not remit thefunds to its holding company till date. The Company is in the process of taking necessary action for settlement of thetransactions.


37 Disclosure as required under Accounting Standard (AS) - 7 on "Construction Contract" is as follows:

38 The balances in respect of certain receivables, payables and loans and advances are subject to confirmation, reconciliationand consequent adjustments, if any. The management does not expect any material difference affecting the financialstatements on such reconciliation / adjustments.

39 Previous year's figures have been regrouped/ reclassified wherever necessary to confirm to the current year's classification.

Signatures to note ‘1' to ‘39'

Current Year Previous Year2013 2012

Amount of contract revenue recognised as revenue in the year 16,633,448 39,649,898

Aggregate contract cost incurred and recognised profit (less 82,541,225 86,084,431recognised losses) upto the reporting date

Advance received 4,455,582 5,151,935

Retention 6,231,079 3,498,473

Gross amount due from customer for contract work as an asset 5,776,883 20,506,186

Gross amount due to customer for contract work as a liability 728,716 --

Particulars

As per our report of even date attached FOR AND ON BEHALF OF THE BOARD OFDIRECTORS

FOR SURESH SURANA & ASSOCIATES LLP DANIELE TERRUZZI ChairmanChartered Accountants

RANGANATH DESAI Executive Director(Vinodkumar Varma) Finance

PARTNERMembership No. 105545 BELA THAKKAR Company Secretary


PROXY FORM

Name of the member(s)

Registered Address

Email ID

Folio No./ Client ID

DP ID

I/We, being the member(s) of …......................... shares of the above named company, hereby appoint

1. Name :

Address :

Email ID :

Signature : …............................................, or failing him/her

2. Name :

Address :

Email ID :

Signature : …............................................, or failing him/her

3. Name :

Address :

Email ID :

Signature : …............................................

as my/ our proxy to attend and vote (on a poll) for me/ us and on my/ our behalf at the Fiftieth Annual GeneralMeeting of Vulcan Engineers Limited to be held on Monday, 30th June, 2014 at 3.00 p.m. at Courtyard by Marriott,"Tulip", Pune City Centre, CTS No.37 & 37/1, Next to Jehangir Hospital, Bund Garden Road, Pune - 411001 and atany adjournment thereof in respect of such resolutions as are indicated below:

VULCAN ENGINEERS LIMITEDCorporate Identification Number: L12801PN1963PLC149701



Phone no. +91 020 6645 0800 | Fax No : +91 020 6645 0801

(Pursuant to section 105(6) of the Companies Act 2013 and Rule 19(3) of Companies (Management and

Administration) Rules, 2014)

Signed this ….......... day of …............... 2014

Signature of shareholder : …..........................

Signature of Proxy holder(s) : …....................

Note: This form of proxy in order to be effective should be duly completed and deposited at the Registered Office of theCompany, not less than 48 hours before the commencement of the Meeting.

Affix

Revenue

Stamp

Resolution No. Resolution

Ordinary Business:

1. Adoption of Audited Balance Sheet, Profit & Loss Account, Reports of the Directors and Audi-tors for the year ended 31st December, 2013.

2. To appoint a Director in place of Dr. Daniele Terruzzi (holding DIN 02975023), who retires byrotation and being eligible, offers himself for re-appointment.

3. To appoint a Director in place of Ms. Paola Terruzzi (holding DIN 02977596), who retires byrotation and being eligible, offers herself for re-appointment.

4. To appoint M/s. Suresh Surana & Associates LLP, Chartered Accountants as Statutory Audi-tors of the Company

Special Business:

5. To appoint Mr. Massimo Ferracci (holding DIN 03173812) to hold office for five consecutiveyears from the conclusion of this Annual General Meeting not liable to retire by rotation.

6. To appoint Mr. Claudio Del Bianco (holding DIN 03349485) to hold office for five consecutiveyears from the conclusion of this Annual General Meeting not liable to retire by rotation.

7. To appoint Mr. Massimiliano Altabella (holding DIN 03282553) to hold office for five consecutiveyears from the conclusion of this Annual General Meeting not liable to retire by rotation.

8. To appoint Mr. Roberto De Filippis Delfico (holding DIN 06873258) as an Additional Directordesignated as an Independent Director with effect from 16th May, 2014, to hold the office for aperiod of five consecutive years from the conclusion of this Annual General Meeting.

9. To reappoint Mr. Ranganath Desai (holding DIN 05214436) as whole time director to be desig-nated as Executive Director - Finance, for a period commencing from 21st February, 2014 to4th July, 2014.

10. To appoint Mr. Anand Gadkari (holding DIN 06873220) as an Additional Director of the Companywith effect from 16th May, 2014.

11. To appoint Mr. Anand Gadkari (holding DIN 06873220) as Managing Director of the Company fora period of 3 (three) years commencing from 16th May, 2014 to 15th May, 2017.

12. To authorise the Board to borrow monies upto Rs. 50 crores as per Section 180(1)(c) of theCompanies Act, 2013.

board of directors - moneycontrol.com · board of directors • mr. astorre terruzzi, chairman...

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