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VTX INDUSTRIES LIMITED(Formerly Vijayeswari Textiles Limited)During the year under review, the loss was mainly incurred on account of sales ofredundant export stocks in the domestic market at discounted price.2)Steps taken or proposed to be taken for improvement –The Company could secure good domestic as well as International orders in hand, executionof which would lead to attain higher turnover and profitability in the years to come. TheCompany has also taken effective steps to control the cost of production.3)Expected increase in productivity and profits in measurable terms –Company plans substantial increase in productivity and growth in profitability for thecoming years.IV. DisclosuresThe information required to be disclosed to the members of the company as per Part II ofSchedule XIII of the Companies Act, 1956, are disclosed in this report. The Company has notdefaulted in repayment of any of its debts or debentures and public deposits.Notes:1.A member who is entitled to attend and vote at the meeting, is entitled to appoint a proxy to attendand vote on a poll instead of himself and such proxy need not be a member of the company. Proxiesin order to be effective must be received by the company not less 48 hours before the meeting.2.The Register of members of the Company and the Share Transfer Books will remain closedfrom 11.08.2012 to 22.08.2012 (both days inclusive).3.As per provisions of the Companies Act, the dividends remaining unpaid for a period of 7years have to be transferred to Investor Education & Protection Fund established by theCentral Government. The Company has already transferred the unclaimed dividends uptothe year 2003-04 to Investor Education & Protection Fund and the dividends pertaining to theyear 2004-05, which are remaining unclaimed shall be transferred to the said fund in October2012.4.The Members who have not yet encashed the dividend warrants for the financial year2004-05 or any subsequent financial years, are advised to claim the dividend from the ShareDepartment of the Company at the earliest. It may also be noted that once unclaimed dividends aretransferred to the Investor Education & Protection Fund, Members will lose their claim on these dividends.5.Members holding shares in physical form are requested to notify if any change in their address/bank account to the company’s Registrar & Share Transfer Agent and the Members holdingshares in electronic form are requested to intimate the changes, if any, to their respectivedepository participants only.6.In order to participate in the “Green Initiative” launched by Ministry of Corporate Affairs in2011, which encouraging paperless compliance, your Company decided to serve allcommunications / documents including notices calling AGM, Audited Financial Statements,Directors report and Auditors report which to be served on the shareholders by the companyunder the Companies Act, 1956, through Electronic mode. Thus, Members are requested tosupport this Green Initiative by updating their e-mail addresses with respective DepositoryParticipants, in case of electronic shareholding; or registering their e-mail addresses withCompany’s Share Transfer Agent, in case of physical shareholding.5

VTX INDUSTRIES LIMITED(Formerly Vijayeswari Textiles Limited)Details of the Directors seeking appointment / re-appointment, to be furnished as perClause 49 of the Listing Agreement.NameAgeQualificationExpertise::::Equity HoldingRelationship::Date of Appointment :Other Directorships :Sri. K. Selvaraj78 yearsLicentiate in Textile Manufacture (LTM) ExpertiseRetired Regional Vice President ofThe Lakshmi Mills Company Limited, CoimbatoreNilHe is not related to any other Director on the Board of theCompany.23.07.2009M/s. Ravilla Precision Engineering Pvt. Ltd.M/s. Lakshmi Technology and Engineering Ind. Ltd.: Sri. Mohan Rao: 59 years: B. Tech., (Textile Technology) from IIT, Delhi.: 37 years of multifaceted consulting and operationalexperience in the Textile IndustryEquity Holding: NilRelationship: He is not related to any other Director on the Boardof the Company.Date of Appointment : 10.05.2012Other Directorships : NilNameAgeQualificationsExpertise: Sri. A.L. Ramachandra: 52 years: Masters Degree in Microbiology from theCalifornia State University, USAExpertise: 23 years wide experience in the textile sector, bothin the field of manufacturing and marketingEquity Holding: 9400 SharesRelationship: He and Smt. Jayanthi Ramachandra, Managing Director arerelated to each other.Date of Appointment : 26.06.1996Other Directorships : M/s. Lakshmi Apparels and Wovens Ltd.M/s. Vijayeswari Exports Ltd.M/s. Seshraj Apparels P Ltd.M/s. Vijayeswari U.K. LimitedM/s. Palladam Hi-Tech Weaving ParkM/s. The Cotton Textile Export Promotion CouncilM/s. Lakshmi Functional Textiles P Ltd.M/s. L.A.W Textile Park P Ltd.NameAgeQualificationBy the Order of the BoardFor VTX Industries LimitedDate : 29.05.2012Place : CoimbatoreA.L. RamachandraChairman & Managing Director6

VTX INDUSTRIES LIMITED(Formerly Vijayeswari Textiles Limited)DIRECTORS’ REPORT TO SHAREHOLDERSToThe Members,Your directors have pleasure in presenting the 58th Annual Report and the Audited Accounts forthe financial year ended March 31, 2012.Financial Results:( in lakhs)ParticularsProfit before Interest, Depreciation and Tax(before extraordinary item)Extraordinary itemProfit before Interest, Depreciation and Tax(after extraordinary item)Less: InterestDepreciation2011 - 122010- 95,320.314296.042,034.261,416.68(3,368.91)Tax expense:a) Current tax expense for current yearb) Less : MAT credit3,450.94845.10168.43(152.12)c) Current tax expense relating to prior yearsd) Net current tax expensee) Deferred taxProfit / (Loss) for the yearAdd: brought from previous yearDividendCorporate Tax on dividendBalance carried to Balance market at discounted price. Your Company hasbeen catering the international markets for themade-ups and the final products manufacturedfor international markets were never disposedin the domestic market as those products werebased on the specific order and approved designof the customers. The rejection of the approveddesign, excess production against the order etc.were kept in the stocks and the same was notconverted to cash awaiting better realizationprice. During the year, these stocks were disposedin the domestic market at price lower thaninternational rate for bringing the cash flow.Considering the loss incurred during the yearunder review and the requirement of funds forfuture growth of the Company, the Board ofDirectors is not in a position to recommend anydividend for the year 2011-12.Review of OperationsDuring the financial year under review, theturnover of the company has increasedto 18900 Lakhs from 16497 Lakhs in thecorresponding previous financial year,registering a growth rate of 14.56%. Thecompany has posted a net loss of 2623.08 Lakhsfor the financial year ended 31 st March, 2012,which was mainly incurred on account of salesof redundant export stocks in the domesticYour Company has taken various cost effectivemethods resulting in better economies ofproduction and purchases throughout thefinancial year.7

VTX INDUSTRIES LIMITED(Formerly Vijayeswari Textiles Limited)Your company has continued to broad base theexisting customer relationships in US and UKmarkets and these relationships spread overmany long years showcase our ability incustomer satisfaction and reliability. TheCompany emphasizes to create a network ofbuying houses, major retail outlets andcommission agents and also develops the brandbuilding exercise both internationally anddomestically. The Indian economy showed aremarkable resilience in the aftermath of globaleconomic slowdown in previous years. YourCompany could secure good orders frominternational as well as domestic markets.FutureIn the external scenario, the textile marketwitnessed unprecedented increase in cottonprices which had cascading effect on the entiresupply chain, resulting instability in the priceof the final products of the Company. The costof production was high due to lower utilisation,increase in the interest rate of the term loan andworking capital facilities availed from theBanks. Your Company was unable to runspinning and weaving units in its full capacitydue to frequent power cuts. In order to executethe orders in time, some portion of the yarn andfabric were outsourced during the year.The future of your Company’s performancelooks very promising since the project expansionprogramme of the company successfullycompleted during last year and with increasedproduction capacity, the company is in aposition to meet its international as well asdomestic orders in time.The growth and future of Indian textile industrydepends upon various factors such asavailability of raw material at reasonable rate,uninterrupted power supply, availability ofmanpower at competitive cost, foreign exchangefluctuation etc. However, the level of exports intextiles from developing countries is increasingeven if in the presence of high tariffs andquantitative restrictions by economicallydeveloped countries. The Company has plannedto enter into the domestic market to increasethe utilisation of the various multi-locationplants.Your Company progressively entered intohospitality segment comprising hotels andhospitals both in India and aboard. Theresponses and enquires received in variousdomestic textile fairs participated by Company,from hospital and hospitality customers, arepositive and gives a boost to increase its footholdin the domestic market. Your company entersinto new international markets like South Africa,Brazil, Argentina, Australia, Japan, France etc.and it is expected to make consistent growth ofthe business in the coming years.During the year under review, the designdivision of the Company was hived off byincorporating a new entity viz. M/s. VTX DesignServices Pvt. Ltd. for providing exclusive designservices to parent and other textile companies.This entity shall develop new creative designs& patterns which meet the latest trends of thecustomers worldwide.Internal Control System and their adequacyThe Company has an adequate system ofinternal controls commensurate with its sizeand nature of business to ensure adequateprotection for the Company’s resources,provision of accurate and speedy financialreports and compliance with the company’spolicies, procedures and legal obligations. Theaudit Committee meets periodically with theManagement, Internal Auditors and StatutoryAuditors to review the internal audit andinternal control systems.Mile StonesYour Company has achieved another milestoneby winning the “Five Star Supplier Award”awarded by Macy’s Merchandising Group for13 th consecutive year, in recognition of itscontinued outstanding service to Macy’sMerchandising Group. Your Company is theonly Company achieves this mammoth feet inthe entire Asian region.8

VTX INDUSTRIES LIMITED(Formerly Vijayeswari Textiles Limited)SubsidiariesSri. S. Shreenivasa Rao is a Post Graduate in Indl.Engg. & Management from NITIE, Mumbai withB. Tech (Elect.) Graduation from IIT, Delhi. He ishaving over 38 years vast industrial experienceand had served in senior management positionsfor big Groups viz. Forbes Group Co. (part ofTATAs) and TVS, for a period of around 22 years.At present, he is running own Textile businessat Hyderabad.Your company has two subsidiaries viz.Vijayeswari UK Ltd and Vijayeswari USA LLC.The accounts of the subsidiaries are consolidatedwith the accounts of Company in accordancewith Accounting Standard AS-21 on consolidatedfinancial statements and Listing Agreementprescribed by Securities Exchange Board of India.The Consolidated accounts duly audited by thestatutory auditors form part of the AnnualReport.Sri. Mohan Rao is a B. Tech (Textile Technology)Graduate of IIT Delhi with 37 years ofmultifaceted consulting and operationalexperience. He had served as President-GroupOperations for M/s. Himatsingka Seide Ltd.,Bangalore where he joined as General Managerin 1988, for a period of 20 years. He had alsoserved as General Manager-ManagementServices for M/s. Gherzi Textile Orgnisation,Bangalore, a premier consulting organization tothe textile industry. Presently, he is engaged asa Management Consultant to the Corporates.DematerializationOut of the 181,69,240 shares, 172,55,053 equityshares stands dematerialized as on 31st March,2012. M/s. Link Intime India Private Limited,Mumbai, having its branch office at Coimbatorehas been retained as the Registrar and TransferAgents of the Company for all shares both inelectronic and physical form.Listing of SharesSri. J. Balamurugan is a Bachelor of Engineering(Electronics & Communication) from RegionalEngineering College, Trichy and has doneManagement program for Entrepreneurial Firms(‘MPEF’) from IIM Bangalore. He is an Entrepreneurand having managing experience in the businessesof Cotton Yarn Spinning, Sheet Metal products, ITinfrastructure, On-line services and aftermarketautomotive enhancements. He was past Chairmanof Confederation of Indian Industry, CoimbatoreZone.The shares of your Company have been listedin M/s. Bombay Stock Exchange Limited,Mumbai and M/s. Madras Stock ExchangeLimited, Chennai.DirectorsKeeping in mind the changing scenario of thebusiness being done by our Company and thechanges in the Board of Directors of theCompany during the financial year underreview, the Board felt the significance to broadbase the Board of Directors of the company byinducting more Directors with professionalskills and expertise in order to bring diversifiedproficiency and focused independence to theBoard, which would help to shape the strategiesfor forthcoming growth of the Company.Accordingly, the Board of Directors appointed 3new Directors to the Board of the Company, abrief profile of them is given under.Outgoing Directors:Duringtheyearunderreview,Sri. N. Balakrishnan, Sri. Vijay Raghunath andSri. Durai Ramaswamy who were Directors ofthe Company, vacated their offices of theDirectors due to personal and health reasons.Capt. K.V. Narayanan vacated his office of theDirector effective 10.05.2012 due to healthreasons. All these Directors contributedimmensely for the growth of the company andthe Board places on record its appreciation forthe valuable services rendered by them and forthe wholehearted support & advice given to thecompany during their tenure in the Company.New Directors:TheBoardofDirectorsappointedSri. S. Shreenivasa Rao, Sri. Mohan Rao andSri. J. Balamurugan as new Directors of theCompany to fill the causal vacancies in theBoard of Directors.9

VTX INDUSTRIES LIMITED(Formerly Vijayeswari Textiles Limited)Directors retire by rotation:b.the Directors had selected suitableaccounting policies and applied themconsistently and made judgments andestimates that are reasonable and prudentso as to give a true and fair view of the stateof affairs of the company at the end of thefinancial year and of the profit of thecompany for that period;c.the Directors had taken proper and sufficientcare for the maintenance of adequateaccounting records in accordance with theprovisions of the Companies Act, 1956, forsafeguarding the assets of the company andfor preventing and detecting fraud andother irregularities, andd.the Directors had prepared the AnnualAccounts on a going concern basis.Sri. K. Selvaraj and Sri. Mohan Rao, Directors ofthe Company retire by rotation at the ensuingAnnual General Meeting and being eligible, offerthemselves for re-appointment.Fixed DepositsIn terms of the provisions of Sec. 58A, thecompany has not accepted any deposits fromthe public during the financial year underreview. There was no refund claim of the FixedDeposits during the year under review and theunclaimed Fixed Deposits as on 31.03.2012 was 11.27 lakhs.AuditorsThe term of Auditors M/s. Suri & Co., CharteredAccountants, Coimbatore, expires at the end ofthe ensuing Annual General Meeting and theyare eligible for re-appointment. The AuditCommittee has recommended their reappointment. The requisite certificate fromAuditors, pursuant to Section 224(1B) of theCompanies Act, 1956, has been received by theCompany.The particulars required by Section 217 (1)(e) ofthe Companies Act, 1956, relating toConservation of Energy, Technology Absorptionand Foreign Exchange Earnings and Outgo, areprovided as the annexure to this report.In terms of Section 217 (2A) of the CompaniesAct, 1956 read with Rule 1A of Companies(Particulars of Employees) Amendment Rules,2011, the Company has no employee drawingsalary exceeding 60 lakhs per annum or 5 lakhs per month during the year underreview.Cost AuditorsThe Board of Directors has appointedM/s. P. Mohan Kumar & Co., Cost Accountants,Coimbatore as Cost Auditors of the Companyfor the financial year 2011-12. The Cost Auditingfor the said financial year is under process andthe Cost Audit report along with Auditor ’sobservations and suggestions, and Annexureshall be filed to the Central Government beforeits due date i.e. within 180 days from the closeof the Company’s financial year to which thereport relates.Corporate GovernanceYour company has complied with CorporateGovernance norms as stipulated under clause49 of Listing Agreement entered into with StockExchanges. A detailed report on CorporateGovernance forms part of this report. Acertificate from statutory Auditors confirmingthe compliance of governance is attached tocorporate governance report.Directors’ Responsibility StatementPursuant to section 217(2AA) of the CompaniesAct, 1956, the Directors do hereby confirm that:a.Management Discussion and Analysis ReportA review of Textile industry, its opportunitiesand threats, future outlook of the company etc.are covered under the Management Discussionand Analysis Report, which is attached to thisreport.in the preparation of the Annual Accounts,the applicable accounting standards hadbeen followed along with properexplanation relating to material departures;10

VTX INDUSTRIES LIMITED(Formerly Vijayeswari Textiles Limited)Human Resource Management / IndustrialRelationsYour company had always been committed tomaintain healthy, cordial and harmoniousindustrial relations at all levels. The workenvironment of the company is constantly beingupgraded. The labor relations continued to becordial throughout the year and industrialrelations were excellent and harmonious.Exemption U/s. 212(8) of the Companies Act,1956.In pursuance of the General Circular videNo.2/2011 dated 08.02.2011, issued by theMinistry of Corporate Affairs, New Delhi, readwith Section 212(8) of the Companies Act, 1956,your company is exempted from attaching theBalance Sheet and Profit & Loss Account of theSubsidiaries viz. Vijayeswari UK Ltd andVijayeswari USA LLC along with the report ofBoard of Directors and report of Auditors’thereon, with the company’s accounts for theyear ended 31 st March, 2012. Accordingly, theAudited accounts and reports of Directors andAuditors of the said subsidiary companies arenot attached to the Balance Sheet of theCompany. However, the accounts of thesubsidiaries are consolidated with the accountsof Company in accordance with AccountingStandard AS-21 prescribed by the Institute ofChartered Accountants of India and ListingAgreement prescribed by Securities ExchangeBoard of India. The Consolidated accounts dulyaudited by the statutory auditors’ forms part ofthe annual report.The annual accounts of the subsidiarycompanies and the related detailed informationshall be made available to the shareholders ofthe holding and subsidiary companies seekingsuch information at any point of time. Theannual accounts of the subsidiary companieswill be available at the registered office of theCompany and at the respective subsidiarycompanies and any shareholders can inspect thesame during the business hours of any workingday.AcknowledgementYour Directors place on record theirappreciation of co-operation and supportextended by shareholders, customers, bankersand all governmental and statutory agencies.Your Directors also thank the employees fortheir valuable contribution during the year andlook forward to their continued support in theyears to come.By the Order of the BoardFor VTX Industries LimitedDate : 29.05.2012Place : CoimbatoreA.L. RamachandraChairman

Sri. A.L. Ramachandra, Chairman & Managing Director holds a Masters Degree in Microbiology from the California State University, USA and is having over 23 years of