TITAN INDUSTRIES 21 Annual Report 2004 - 2005 To be Innovative, World class, Contemporary and build India's most desirable brands X To be the most desirable jewellery brand for Indian women TITAN INDUSTRIES Twenty-first annual report 2004-2005 Board of Directors Rameshram Mishra (Chairman) Bhaskar Bhat (Managing Director) Ishaat Hussain N N Tata Farrokh Kavarana T K Balaji A C Mukherji C G Krishnadas Nair Rama Bijapurkar (upto 25 May 2005) Md. Nasimuddin (upto 4 Jan 2005) Pradeep Yadav (upto 8 June 2005) S Susai Company Secretary Usha lyengar Auditors A F Ferguson & Co. (Chartered Accountants) Bankers Canara Bank Contents Bank of Baroda Notice 2 Hongkong Bank Standard Chartered Bank Directors' Report 9 Oriental Bank of Commerce Management Discussion & Analysis 17 Union Bank of India Corporate Governance Report 25 Registered Office Auditors' Report 36 3, SIPCOT Industrial Complex Balance Sheet 40 Hosur635 126 Profit & Loss Account 41 Share Department Cash Flow Statement 42 Tata Share Registry Limited Schedules & Notes to Accounts 49 Unit:Titan Industries Limited Army & Navy Building Interest in Subsidiaries 63 148, Mahatma Gandhi Road Consolidated Accounts 65 Mumbai 400 001 Financial Statistics 91 Titan Industries is a TATA Enterprise in association with the Tamil Nadu Industrial Development Corporation TITAN INDUSTRIES Twenty-first annual report 2004-2005 Titan Industries Limited Notice The Twenty-first Annual General Meeting of Titan Industries Limited will be held at the Registered Office of the Company, at 3 SIPCOT Industrial Complex, Hosur 635 126, on Wednesday, 31 st August 2005 at 3.30 p.m. to transact the following business: 1) To receive and adopt the Directors' Report and Audited Profit and Loss Account for the year ended 31st March 2005 and the Balance Sheet as at that date together with the report of the Auditors thereon. 2) To declare dividend on Equity Shares. 3) To approve the declaration and payment of interim dividend as final dividend on preference shares. 4) To appoint a Director in place of Mr. Ishaat Hussain who retires by rotation and is eligible for re-appointment. 5) To appoint a Director in place of Mr. F K Kavarana who retires by rotation and is eligible for re-appointment. 6) To appoint a Director in place of Mr. N N Tata who retires by rotation and is eligible for re-appointment. 7) To consider and, if thought fit, to pass with or without modification, the following resolution as a Special Resolution: "RESOLVED that pursuant to the provisions of Section 81 and other applicable provisions, if any, of the Companies Act, 1956 (including any statutory modification(s) or re-enactment thereof, for the time being in force), and in accordance with the provisions of the Memorandum and Articles of Association of the Company and Listing Agreement(s) entered into by the Company with the Stock Exchange(s) and subject to the applicable guidelines and approvals of the Securities and Exchange Board of India (SEBI), Reserve Bank of India (RBI) and all other appropriate authorities as may be required and such other approvals, permissions and sanctions as may be necessary and subject to such terms and conditions, alterations/deletions and modification(s) as may be prescribed or imposed by any of them while granting such approvals, permissions and sanctions, which may be agreed to by the Board of Directors of the Company (hereinafter referred to as the "Board" which term shall be deemed to include any Committee thereof for the time being exercising the powers conferred by the Board), the consent of the Company be and is hereby accorded to the Board to create, issue/offer and allot, at its sole discretion, Equity Shares of Rs.10/- each and/or any other Financial Instruments including Debentures, whether fully, partly or non-convertible with or without detachable or non-detachable warrants,(hereinafter collectively referred to as"Securities") at par or at such premium, at such time and on such terms and conditions, including price as the Board may determine for an aggregate value not exceeding Rs. 165 crores (including premium) either to members, employees, promoters and persons deemed to be acting in concert, Non Resident Indians, Domestic/Foreign Financial Institutions, Foreign Institutional Investors, Banks, Mutual Funds, Insurance companies, Bodies Corporate, other entities and /or other persons, whether shareholders of the Company or not through or by public issue, rights issue, private placement or by any one or a combination of the above, whether subscribed in Indian or foreign currency and in one or more series whether on the same terms and conditions or with varying terms and conditions and whether at one time or from time to time as may be deemed appropriate by the Board. RESOLVED FURTHER that the consent of the Company be and is hereby granted in terms of Section 293(1 )(a) and other applicable provisions, if any, of the Act and subject to all necessary approvals to the Board to secure, if necessary, all or any of the abovementioned Securities to be issued by the creation of a mortgage and / or charge on all or any of the Company's immoveable and / or movable assets, both present and future in such form and manner and on such terms as may be deemed fit and appropriate by the Board. RESOLVED FURTHER that for the purpose of giving effect to the above, the Board be and is hereby authorised to determine the form and terms of the issue(s) of Securities, the class of investors to whom the Securities are to be allotted, number of Securities to be offered and allotted in each tranche, issue price, face value, premium on issue/ conversion / redemption of Securities / exercise of warrants, rate of interest, redemption period of Securities and listing thereof on one or more Stock Exchanges in India and / or abroad as the Board may, in its absolute discretion deem fit and to make and accept any modification in the proposal as may be required by the statutory / other authorities involved in issue of Securities in India and / or abroad and to settle any question or difficulty which may arise in this regard. RESOLVED FURTHER that, for the purpose of giving effect to this Resolution, the Board of Directors or Committee of Directors duly constituted by the Board, be and is hereby authorized to do all such acts, deeds, matters and things as they may, in their absolute discretion deem necessary, appropriate and desirable." 8) To consider and, if thought fit, to pass with or without modification, the following resolution as an Ordinary Resolution: "RESOLVED that in furtherance to and in partial modification of the Resolution No.10 passed at the Twentieth Annual General Meeting of the Company held on 31st August 2004, relating to the appointment and terms of remuneration of Mr.Bhaskar Bhat, Managing Director of the Company, the Company do and hereby approve the upward revision in the scale of salary of Mr. Bhaskar Bhat from Rs.50,000 - Rs. 1,50,000 per month to Rs.1,00,000 - Rs. 2,50,000 per month subject to the provisions of Sections 269,309,310and311and other applicable provisions, if any, of the Companies Act, 1956." 9) To consider and, if thought fit, to pass with or without modification, the following resolution as a Special Resolution: "RESOLVED that pursuant to Section 309 of the Companies Act, 1956 and Article 125 (a) of the Articles of Association of the Company and subject to the limits stipulated in Section 309(4) of the Companies Act, 1956, the Company be and is hereby authorised to pay remuneration by way of commission, to Directors who are neither in the whole time employment of the Company nor Managing Director(s) of the Company. RESOLVED FURTHER that the gross amounts to be disbursed as remuneration to all such Directors shall, in no case exceed one per cent of the net profits of the Company, computed in the manner referred to in Section 198(1) of the Companies Act, 1956. RESOLVED FURTHER that the Board of Directors may, at its discretion, decide the exact amount to be disbursed by way of commission within the limits stipulated above and its allocation amongst the eligible Directors." 10) To consider and, if thought fit, to pass with or without modification, the following resolution as an Ordinary Resolution: "RESOLVED that pursuant to the provisions of Sections 309, 310 and other applicable provisions, if any, of the Companies Act, 1956 (the "Act") and Article 125 of the Articles of Association of the Company, the approval of the Members be and is hereby accorded to the payment of Sitting Fees to each Director, other than the Managing Director or any other Director who is in the whole time employment of the Company for each meeting of the Board of Directors of the Company or specified Committees of the Board, attended by such Director as may be approved by the Board from time to time, so as not to exceed limits specified in the Act and/ or the Rules made thereunder or any amendments thereto. TITAN INDUSTRIES Twenty-first annual report 2004-2005 Titan Industries Limited RESOLVED FURTHER that the Board of Directors be and is hereby authorised to do all such acts, deeds, matters and things as may be considered necessary, usual, proper or expedient to give effect to the aforesaid resolution." 11) To consider and, if thought fit, to pass with or without modification, the following resolution as a Special Resolution: "RESOLVED that M/s. A. F. Ferguson & Co. be and are hereby re-appointed as Auditors of the Company, to hold office from the conclusion of this meeting until the conclusion of the next Annual General Meeting, to audit the accounts of the Company for the financial year 2005-06, including audit of Cash Flow Statements, on a remuneration of Rs.