Directors Report of Wilwayfort India Ltd.

Mar 31, 2009

Financial Results:

The financial results of the Company for the year under review as compared to the previous year are summerised below for your consideration.

(Rupees in lacs)

PARTICULARS Current Year Previous Year ended 31,3.2009 ended 31.3.2008

Sales & other Income 989.56 1758.49

Profit / (Loss) before Interest and 359.31 (39.32)

Finance charges and Depreciation

Interest and Finance Charges 35.84 60.74

Profit / (Loss) before Depreciation 323.47 (100.06)

Depreciation 68.06 81.89

Profit, (Loss) before tax 255.41 (181.95)

Expenses relating to previous year 0.78 1665.40

Net Profit / (Loss) 256.19 1483.45

Profit / (Loss) brought forward (1245.11) (2728.56) from previous year

Profit / (Loss) carried to Balance Sheet (988.92) (1245.11)

The above results are not comparable from the corresponding financial year as the Company engaged into job work activities of the same product such as- Metallising, Coating and Holography etc. for its reputed customers after having sold its land and building, electrical installations etc. in the previous year. The Company also introduced new value added products in the year which also contributed in the performance of the Company. Thus, in the financial year under review, the Company carried only job work activities for its long term valued customers.

Impact of One Time Settlement (OTS) Scheme with Vijaya Bank and New Business Activities:

As you are aware that Company had been operating with huge term loan including interest and other levies liability of Vijaya Bank (Rs. 2222.14) lacs as on 31" March, 2007) which was secured against all its immovable and movable assets including land & building, plant & machinery, stocks etc. of the Company. The Company has been incurring acute financial losses due to the reasons such as non-availability of working capital, higher interest burden and volatility & higher raw material prices etc. which has been resulted into accumulation of secured loan liability over the years in the past.

The Company took the following major restructuring decision in the previous year 2007-2008 which have shown good results in the current year of operations:

A. As reported in the previous year, Company settled its outstanding aforesaid loan liability of Rs.500 lacs along with simple interest ot 5% thereon under One Time Settlement (OTS) Scheme with Vijaya Bank.

The Company also entered into a Memorandum of Understanding with M/s. Rustagi Impex Pvf Ltd, New Delhi to secure financial support to the Company for making payment of outstanding dues including interest of Rs. 650 lacs under OTS scheme to Vijaya Bank against the sale of fixed assets - existing industrial plot, building, electrifical installations situated at A-581 (A), Bhiwadi Industrial Area, Distt- Alwar, Bhiwadi-301 019, Rajasthan. Thus, with the sincere efforts made by the management of your Company towards liquidation of loan liability of Vijaya Bank under the One Time Settlement (OTS) scheme has not only reduced the huge burden of interest but also made the Company as DEBT FREE Company.

B. Having a Debt Free Company with reduced interest burden has provided an opportunity to the management of your Company to make a new business plan for its early revival. Making an another sincere efforts towards restructuring of business plan, the management of your Company after having sold the fixed assets-factory plot & building situated at Bhiwadi (Rajasthan) to M/s. Rustagi Impex Pvt Ltd, New Delhi, has taken the same industrial factory on long term lease in the month of April,2008 to start the job work activity i.e. Metallising , Coating and Holography etc.

Thus the financial results of the year 2008-2009 is having only job work activities for its long term associated customers with quality services.

C. Further, the Company has introduced value added products such as spangle pet film, coated films and heat sealable BOPP film etc. for flexible packaging. The Company has also ensured a long term supply of material for job work with M/s. Rustagi Impex Pvt. Ltd. which will certainly facilitate the management in drawing a long term revival plan of the Company. These Value Added Products has also shown contribution in the performance of the Company.

The restructuring decision taken by the Company in the previous year 2007-2008 has shown the positive results in the operations of financial year 2008-2009 in terms of: i. Substantial reduction of interest burden.

ii. Better productivity in terms of capacity utilization.

iii. Improved financial management- Lower Working Capital requirement.

iv. Improved profitability margins.

v. No impact of fluctuating material cost.

vi. Better management of Human Resource- Manpower has been rationalized as per the requirement in job work activities.

vii. Better Administrative management & Cost Effectiveness. Barring unforeseen circumstances, the Board of Directors of the Company is hopeful to further improve the financial results with the continued increased demand of the product in domestic as well as international market. It will enable the Company to reset itself on the path of growth with improvement in global recession scenario.

Modified Revival Plan Under BIFR:

In view of settlement of secured loan liability of Vijaya Bank and Possession Notice under the Securitization & Reconstruction of Financial Assets and Enforcement of Security Interest Act,2002 (54 of 2002) stands withdrawn, Board for Industrial & Financial Reconstruction (BIFR) had directed the Company to submit a draft modified revival proposal for its consideration. Vijaya Bank will continue to act as Monitoring Agency to monitor the progress of implementation of scheme. Keeping in view the recent positive results of the decision taken by the management in the interest of the Company and its stakeholders, modified revival proposal will be submitted with BIFR for its consideration.The management is hopeful that BIFR will take an appropriate decision with announcement of revised rehabilitation package for early revival of the Company.

Dividend:

In view of the carry forward of accumulated losses in the Company, the Board of Directors regret their inability to recommend payment of any dividend for the financial year under review.

Industry Structure and Development:

Metallising and Coating of Polyester Film and BOPP Film for packaging industry, textile industry and decorative articles is rapidly growing in our country. Fresh capacities have been installed in polyester film and BOPP film and Metallising industry to avail of the opportunity of growth. The growth continued unabated at 12%.

Opportunities and Threats:

The demand in the product in our country is growing as stated above but the international market has shown steep downward trend due to the recession in USA and European market.

Future Outlook:

Due to recent global recession and consequently depression in product demand in domestic as well as export market, the future of polyester film industry is largely depend on domestic demand which seems to be unstable for medium term. However, the Board of Directors is confident that keeping in view the large volume of domestic consumption of product in India itself, the industry will be able to absorb the heat of global recession.

Internal Control Systems:

The Company has evolved a system of internal control to ensure that the assets are safeguarded and transactions are authorized, recorded and correctly reported. Planned periodical reviews are carried out resulting in identification of control, deficiencies and opportunities for bridging gaps with best practices. The Audit Committee reviews the adequacy of the internal control systems.

Segment- Wise / Product- Wise Performance:

The Companys operating business is organised and managed according to the nature of product with Single Primary Reportable Segment comprising of manufacturing and supply of Metallising, Coating and Embossing of Plastic Film. The detail of segment reporting is given at Schedule XVI (24) of the Annual Accounts.

Human Resource Development:

The industrial relations remained cordial during the year under review. Mapping of jobs has been initiated to ensure that the right person is allocated the right job. The Company reviews manpower need and allocation of job from time to time to ensure the best utilization and growth of the workforce.

Cautionary Statement:

Statements in this report, describing the Companys objectives, expectations and/or predictions, may be forward looking within the meaning of applicable securities law and regulations. Actual results may differ materially from those stated in the statement. Important lactors that could influence the Companys sales revenue, includes global and domestic supply and demand conditions, affecting selling prices of finished goods, availability of inputs and their prices, changes in the government regulations, tax laws, economic development within the country and outside and other factors such as litigation and industrial relation.

Public Deposits:

The Company has not invited any deposits from the Public within the meaning of section 58A of the Companies Act, 1956 and rules framed there under, during the financial year under review.

Directors:

In terms of Section 255 of the Companies Act, 1956, Mr. Arun Kumar Ahluwalia retires by rotation in the ensuring Annual General Meeting, however being eligible offers himself for re- appointment.

Auditors:

Messrs KPMCS Associates, Chartered Accountants holds office until the conclusion of the ensuing Annual General Meeting and being eligible offers themselves for re-appointment. The Board of Directors recommends their re-appointment for the financial year 2009-10 and fo fix their remuneration.

Auditors Report:

The management make the following comments on the observation made by the Statutory Auditors in their Audit Report:

1. Payment of sales tax amounting to Rs. 3,91,438/ has been made till 4" August, 2009 out of Rs. 30,07,112/ outstanding as on 31" March, 2009 mentioned under Para 9 (a) of the Auditors Report. Further payments are also being made.

2. Payment of entry tax amounting to Rs.2, 55,008/ as on 31 • March, 2009 under Para 9 (a) of the Auditors Report is under consideration in light of the judgement pronounced in the legal case- Dinesh Pouches Limited vs. State of Raiasthan by Honble High Court of Rajasthan.

3. Disputed statutory dues as mentioned in Para 9 (b) of the auditors report are under appeal before the appropriate authority and no final order of the appellant authority has been received till date. Therefore, management will take the appropriate steps as and when (he decision of appropriate appealant authority will come.

4. The Government of India under the Foreign Trade Policy 2004-09 made a general provision for BIFR units to extend the time limit permitting the export obligation of all the BIFR units. Therefore, there is no shortfall of target of export obligation as mentioned at Schedule XVI (16) of the Annual Accounts.

Corporate Governance:

Pursuant to clause 49 of the listing agreement entered into with the stock exchanges, the Report on Corporate Governance together with Auditors Certificate on Corporate Governance is annexed with this Report.

Particulars of Employees:

There was no employee during the year under review in respect of whom information is required to be given under section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975 as amended.

Directors Responsibility Statement:

As required under section 217(2AA) of the Companies Act, 1956, the Directors confirm thai:

I. In the preparation of the annual accounts, the applicable accounting standards had been followed and (hat no material departure had been made from the same;

II. the Oirectors had selected such accounting policies and applied them consistently and made Judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the Profit and Loss of the Company for that period;

III. the Directors had taken proper and sufficient care for the maintenance of adequateAccounting 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; and

IV. the Directors had prepared the annual accounts on a going concern basis.

Particulars of Conservation of Energy, Technology Absorption & Foreign Exchange Earnings and Outgo:

The information required to be disclosed pursuant to Section 217(1)(e) of the Companies Act, 1956 read with the Companies (Disclosure of Particulars in the Report of the Board of Directors) Rules, 1988 with respect to Conservation of Energy, Technology absorption and Foreign Exchange earnings and outgo, is given in the annexure - A forming part of this report.

Appreciation:

The Board of Directors of tha Company takes the opportunity to express sincere appreciation for the efforts put in by the officers and employees of the Company, at all levels, for attainment of improved working results during the year under review. Relations with the workers remain cordial. We express our sincere thanks to the bankers, business associates and shareholders of the Company for their cooperation in such difficult time.

Registered Office: By Order of the Board of Directors

B-68, Flatted Factory Complex Okhla Phase-Ill, New Delhi -110 020

Inder Pal Singh Walia

Date : 12.08.2009 Managing Director