FINANCIAL HIGHLIGHTS

                                                      (Rs. in lacs)

                      2012-13        2011-12      2012-13      2011-12
Particulars      Consolidated   Consolidated   Standalone   Standalone

1 Revenue from 
Operations 
(Net)                 499,009        635,526      339,588      351,146

2 Other Income            964            904          161          138

3 Profit/(Loss) 
from Operations
(PBIDT)                91,010        134,855       57,178       77,655 

(-) Finance Costs      73,609         53,486       53,031       40,510 

(-) Depreciation 
and Amortization 
Expenses               16,922         14,777       12,877        9,222

4 Profit/(Loss) 
before Tax and 
Exceptional Items         479         66,592       (8,730)      27,923 

(-) Exceptional 
(Expenses)/ 
Incomes               (32,415)           -        (32,415)        -

5 Profit/ (Loss) 
before Tax            (31,936)        66,592      (41,145)      27,923

6 (-) Provision 
for Taxation            3,459         19,508          271        9,966

7 Profit/ (Loss) 
After Tax             (35,395)        47,084      (41,416)      17,957

(-) Minority
Interest *              1,557          7,590           -          -

8 Amount 
Available for 
Appropriation         (36,952)        39,494      (41,416)      17,957

9 Balance b/f 
from Previous 
Year                   80,689         57,401       17,360       17,421
Appropriations: 

10 Transfer to 
Debenture 
Redemption 
Reserve                  -               203          -            203

11 Transfer to 
Capital 
Redemption 
Reserve                   475             -           475          -

12 Balance in 
Restructured 
Financial Cost 
written Off              -            16,288          -         14,310

13 Reversal of 
Proposed 
Preference & 
Equity Dividend
and Tax                (3,505)            -        (3,505)        -

14 Provision for 
Preference 
Dividend                 -               32                         32

15 Tax on 
Preference 
Dividend                 -                5                          5

16 Proposed 
Equity 
Dividend                              2,974                      2,974

17 Tax on 
Proposed Equity 
Dividend                 -              494                        494

18 Surplus/ 
(Deficit) 
carried to 
Balance Sheet          46,767         76,899      (21,026)      17,360 

DIVIDEND

In view of the Losses incurred during the year, your Directors are unable to recommend dividend on Equity Shares and Preference Shares for the year ended 31st March, 2013.

YEAR IN RETROSPECT

The year witnessed several challenges in the operating and business environment. Even as the global economic environment continued to be subdued, there was a significant slowdown in economic growth in India. While India's long-term economic fundamentals and growth potential are strong, the current challenges have had implications on business sentiment and corporate profitability. Economic slowdown and the accompanying slackness in demand have taken a heavy toll on several Indian companies.

These global uncertainties also adversely affected your Company's growth momentum. Your Company's turnover came down by about 3% on a standalone basis. For the first time in years, the Company incurred a substantial loss as reflected in the Financial Highlights. Besides the economic environment and demand contraction, other contributory factors for the adverse results were inadequacies of working capital and cessation of activities at your Company's UK and US subsidiaries owing mainly to unfavorable market conditions in a volatile economy. As a result, your Company experienced severe cash crunch, on account of which it could not keep up with meeting interest payment to lenders and some statutory liabilities.

Earnings of garment and textile manufacturers have been under pressure over the past few years owing to higher raw material costs and sluggish domestic and foreign demand. Costs are rising and margins are getting squeezed. It is hoped that a good festive season, encouraged by a strong monsoon and an increase in rural demand will make things turn around.

EXPORTS

The Indian textile and clothing industry is sized at around $80 billion of which around $35 billion is exports. Volatility in raw material prices and expensive as well as limited credit have strained mills' finances, while the economic crisis in the US and the EU, which together account for 65% of India's supplies, has adversely affected demand, reinforcing fears that the overall textile export growth could be the lowest in fve years and the shipment target of $40.59 billion for this fscal is all set to be missed. There is a slowdown in the US and much of Europe, which has resulted in a dip in supplies across most segments.

Your company is predominantly a domestic player. It was able to manage exports of Rs. 436 Lacs as against Rs. 6,692 Lacs in the previous year. Additionally, exports from the Company's subsidiary Reid & Taylor (India) Ltd. reached Rs. 2,416 Lacs (previous year Rs. 3,747 Lacs).

Demand seems to be returning now after a tepid start in this fscal and may finally show a marginal uptick in full year exports.

CURRENT BUSINESS OUTLOOK AND PLANS

Demand for textile and apparel industry in India continues to be sluggish on account of a recessionary trend in the economy. 'Belmonte' in Consumer Textiles and 'Reid & Taylor' in Luxury Textiles segment continue to remain key contributors to the overall performance of the Company. It is hoped that conditions may start improving in the rest of the year so that with adequate working capital sourcing, your Company would be able to operate its plants at higher capacities and with higher margins. Until maximum utilization of Company's plants is reached, there are no plans for capacity expansion in the coming year.

CORPORATE SOCIAL RESPONSIBILITY (CSR)

Your Company is committed to support CSR initiatives and contribute towards the welfare and social up liftmen of the community.

EMPLOYEES STOCK OPTION SCHEME (ESOP)

As the employees of the Company did not exercise the option under ESOP scheme, the Company cancelled / withdrew 546,060 nos of ESOPs granted under Employees Stock Option Scheme. There were 365,760 nos. of options in force as at 31st March, 2013.

HUMAN RESOURCE

Your Company recognizes that employees play a key role in making our business successful and we achieve that through empowering our employees. Your Company maintained an environment dedicated to maintaining high employees' sense of pride, morale and teamwork. The Human Resource Development activities focused on multi-skills training and performance management workshops. The functioning and activities were further aligned to Company's business objectives. The ongoing thrust on rationalization of manpower with focus on proper utilization continued with implementation of Zero-base manpower budget.

CORPORATE GOVERNANCE

To comply with the conditions of Corporate Governance, pursuant to Clause 49 of the Listing Agreement with the Stock Exchange, a separate section on Management Discussion and Analysis and Corporate Governance together with a certificate from a Practicing Company Secretary confirming compliance is included in the Annual Report.

INFORMATION TECHNOLOGY

Your Company was in the process of implementing Enterprise Resource Planning (ERP), but was obliged to go slow on account of funding problems and had to defer completion of the programme to a later date.

DIRECTORATE

Vide letter dated 5th November, 2012, IDBI Bank Limited appointed Smt. Ranjitha Godbole as Nominee Director in place of Smt. Amita Narain. The Board placed on record the guidance, advice and support extended by Smt. Amita Narain during her tenure as a Director. We look forward to the guidance and experience of Smt. Ranjitha Godbole to help the Company in achieving its objectives.

India Debt Management Pvt. Ltd. (IDM) appointed Shri Navin Sambtani in place of Shri Alexander Shaik as an Alternate Director to Shri Denys Firth with effect from 10th November, 2012. Vide letter dated 10th January, 2013, IDM withdrew the nomination of Shri Susheel Kak, Shri Denys Firth and Shri Navin Sambtani (Alternate to Shri Denys Firth) as Director.

Shri Jagadeesh S. Shetty, Director - Finance & Group CFO was appointed as an Additional Director on the Board with effect from 10th November, 2012 pursuant to Section 260, 264 of the Companies Act, 1956. The Company has received the requisite notice from a member pursuant to Section 257 of the Companies Act, 1956 proposing the candidature of Shri Jagadeesh S. Shetty for the offce of Director.

Various reasons such as preoccupation, family commitment, time constraints, increased work load and advancing age led to the resignation of some Directors from the Board. viz.

Smt Jyoti N. Kasliwal with effect from 24th August, 2012

Shri M. Damodaran with effect from 8th October, 2012

Shri Suresh N. Talwar with effect from 26th November, 2012

Shri Dara D. Avari with effect from 1st March, 2013

Shri Jitender Balakrishnan with effect from 28th March, 2013

The Board placed on record the invaluable contribution to the deliberations, advice and guidance given by all the Directors during their tenure as Directors.

In accordance with the Companies Act, 1956 and the Company's Articles of Association, Shri Vijay Kalantri retires by rotation and being eligible, offers himself for re-appointment.

DIRECTOR'S RESPONSIBILITY STATEMENT

To the best of their knowledge and belief and according to the information and explanations obtained by them, your Directors make the following statement in terms of Section 217(2AA) of the Companies Act, 1956:

1) that in preparation of the Annual accounts the applicable Accounting Standards have been followed along with proper explanations relating to material departures, if any;

2) that such Accounting Policies have been selected and applied consistently, and judgments and estimates have been made that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2013 and of the Statement of Profit and Loss of the Company for the year ended on that date;

3) that proper and sufficient care has been taken for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

4) that the Annual accounts have been prepared on a going concern basis.

DEPOSITS

Fixed Deposits received from the shareholders and the public stood at Rs. Nil as on 31st March, 2013 (Previous year Rs. Nil).

There is no deposit or interest claimed but remained unpaid. All the claimed deposits with interest have been repaid in time. Members are aware that the fixed deposit schemes have been discontinued with effect from 1st April, 2001, as benefits were not commensurate with administrative costs.

STATUTORY INFORMATION

FINANCE AND ACCOUNTS

The observations made by the Auditors in their Report and included in the relevant notes to Financial Statements are self explanatory.

CONSOLIDATED FINANCIAL STATEMENTS

The consolidated financial statements have been prepared by your Company in accordance with the applicable Accounting Standards (AS 21, AS 23 and AS 27) issued by the Institute of Chartered Accountants of India and the same together with Auditors Report thereon form part of the Annual Report.

SUBSIDIARY COMPANIES

The statement pursuant to Section 212 of the Companies Act, 1956 containing the details of the Company's subsidiaries is attached. Pursuant to direction under section 212(8) of the Companies Act, 1956 by Government of India, Ministry of Corporate Affairs, New Delhi vide General Circular No. - 2/2011 No. 51/12/2007-CL-III dated 8th February, 2011, the Board of Directors, by passing resolution on 16th July, 2013, gave consent for not publishing / attaching copies of the Balance Sheets, Statement of Profit & Loss,

Reports of the Board and the Auditors of all the Subsidiary Companies with the audited financial statements of the Company as at 31st March, 2013.

The annual accounts of the subsidiary companies are kept for inspection by any shareholder at the registered office of the Company and shall be made available to shareholders seeking such information at any point of time.

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

Additional information required under the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 in respect of Conservation of Energy and Technology Absorption is given in the prescribed forms which are given in Annexure '1' to the Directors' Report.

PARTICULARS OF EMPLOYEES

Information as per Section 217 (2A) of the Companies Act, 1956 read with Companies (Particulars of Employees) Rules, 1975, as amended, forms part of this Report. However, as per the provisions of Section 219 (1) (iv) of the Companies Act, 1956, the Report and Accounts are being sent to all shareholders of the Company excluding the statement of particulars of employees under Section 217 (2A) of the Companies Act. Any shareholder interested in obtaining a copy of the said statement may write to the Company Secretary at the Registered Office of the Company.

AUDITORS

M/s. Haribhakti & Co., Chartered Accountants, Mumbai, (bearing form registration no. 103523W), existing Statutory Auditors of the Company were re-appointed by the Shareholders of the Company at the Annual General Meeting held on Thursday, 27th September, 2012, who hold the office up to the conclusion of the ensuing Annual General Meeting. Since M/s. Haribhakti & Co. Statutory Auditors will be completing 10 years of statutory audit of the Company, as per the requirements of the proposed provisions of the Companies Act, 2013 have offered to make way for the Company to appoint another frm of Chartered Accountants as Statutory Auditors of the Company at the ensuing Annual General Meeting.

The Board, on the recommendation of the Audit Committee has proposed that M/s. Shyam Malpani & Associates, Chartered Accountants, Mumbai to be appointed as Statutory Auditors to hold office till the conclusion of the next Annual General Meeting of the Company. M/s. Shyam Malpani & Associates have expressed their willingness to act as Statutory Auditors of the Company, if appointed, and have confirmed that the said appointment if made, would be in conformity with the provisions of Section 224(1B) of the Companies Act, 1956.

In respect of observations made by the auditors, please refer to notes to fnancial statements, note no. 31,33(a), (b), 35 in respect of Standalone Financial Statements and notes no. 31, 33(a) &(b),35, 37 (b) in respect of Consolidated Financial Statements which are self explanatory and hence in the opinion of Directors, do not require any further explanation.

Cost Audit

The Cost Audit for the financial year ended 31st March 2013 was conducted by M/s. D.H. Zaveri & Associates., Cost Accountants, Mumbai. In terms of the provisions of Section 233B of the Companies Act, 1956, the Board of Directors of your Company have on the recommendation of the Audit Committee, appointed M/s. D.H. Zaveri & Associates., Cost Accountants, Mumbai as Cost Auditors to conduct the cost audit of your Company for the financial year ending 31st March, 2014.

ACKNOWLEDGEMENT

Your Directors wish to place on record the support, assistance and guidance provided by the financial institutions, banks, customers, suppliers and other business associates. Thanks are also due to your Company's employees for their tireless efforts and high degree of commitment and dedication. Your Directors especially appreciate the continued understanding and confidence of the Members.

                                          By Order of the Board 

                               For S. KUMARS NATIONWIDE LIMITED

Place : Mumbai                                Nitin S. Kasliwal

Date : 16th July, 2013             Chairman & Managing Director