Excellence in Engineering…. It is an art; it is a science It requires skill; it requires vision It needs flair; it needs innovation It involves execution …. …. With perfection We are WELSPUN FINANCIAL HIGHLIGHTS (Consolidated) Total Income (Rs. Mn) PAT (Rs. Mn) 92,442 8,000 105,000 6,104 6,330 73,822 81,360 6,000 57,582 40,052 3,408 55,000 4,000 2,135 2,385 2,000 5,000 - 2007-08 2008-09 2009-10 2010-11 2011-12 2007-08 2008-09 2009-10 2010-11 2011-12 Exports/Overseas Revenue (Rs. Mn) Basic EPS (Rs. / Share) 65,000 52,603 52,860 46,139 41.0 41,515 31.7 45,000 30.9 32,750 31.0 20.9 21.0 25,000 11.5 10.9 11.0 5,000 1.0 2007-08 2008-09 2009-10 2010-11 2011-12 2007-08 2008-09 2009-10 2010-11 2011-12 Reported EBITDA (Rs. Mn)@@ Networth (Rs. Mn) @ 49,139* 13,372 ## 14,500 13,784 ### 50,000 11,247 12,500 40,000 33,735 10,500 29,011 # 8,500 6,662 6,535 30,000 6,500 20,000 15,672 15,597 4,500 10,000 2,500 500 1,000 2007-08 2008-09 2009-10 2010-11 2011-12 2007-08 2008-09 2009-10 2010-11 2011-12 EBITDA Margin (%) Fixed Assets (Gross Block- Rs. Mn) 18.1% 20.0% 16.6% 16.9% 100,000 86,957* 12.2% 58,339* 15.0% 11.3% 75,000 10.0% 50,000 40,682 44,248 29,213 5.0% 25,000 0.0% - 2007-08 2008-09 2009-10 2010-11 2011-12 2007-08 2008-09 2009-10 2010-11 2011-12 @@: For FY11 and FY12, Other Income, a part of Reported EBITDA includes Interest Income for the respective years. # FY 09: Figures are excluding the extraordinary item :Forex provision of Rs. 1,256 million, Provision on ECB of Rs. 178 million and Inventory write down of Rs. 385 million during FY 2008 09. @ FY 10: Forex Provisoning made in the previous year were recovered during the year. ## FY 2010 11: Includes export rebate of Rs. 734 million on receipt of favourable judgement from Honorable Supreme Court and provision of Rs. 2,007 million on account of settlement with one of the customers thereby ending long pending litigation. ### FY 2011 12: Includes Other Income of Rs. 2,676 million which includes interest income of Rs. 1,339 million. Operational Performance was impacted by foreign exchange provisions of Rs. 1,248 million, and Rs. 269 million in other expenses & finance costs, and provisions made towards amicable settlement with a customer of Rs. 649 million. * Net worth includes CCDs of Rs. 7,884 million. C rp Ltd CONTENTS Excellence in Engineering Corporate Information .......................... 2 Excellence in Engineering has been the driving force behind every venture that Welspun Corp has undertaken and it continued to be evident during the last financial Chairman’s Statement .......................... 6 year. It was the unending quest for excellence, the constant striving to do even the most ordinary things well thathasmadetheCompanyaclassapart. Directors’ Report .......................... 10 The last financial year was a great one for Welspun Corp Ltd (WCL). In spite of the downturn the company was Corporate Governance Report .......................... 18 able to commission most of the projects it had committed to and registered a sustained performance Management Discussion and Analysis .......................... 31 with strong order book position of Rs. 7,447 crore. This is really creditable as overall industrial production continued to slide throughout the year. Catalysing Change (CSR) .......................... 70 Last fiscal, one of the biggest achievements undoubtedly was the investment by Apollo Global Financial Section .......................... 73 Management, LLC (together with its subsidiaries, Apollo) in the company. This partnership will pave the way for Welspun to strengthen its leadership position as FAQ’s .......................... 172 one of the top line pipe companies in the world. Another significant development was the announcement of expansion plans at the Little Rock facility in Arkansas. Another 200 jobs will be added at an investment of additional $80 million. During FY12, the Company also commissioned a 0.10 million tonne capacity HSAW Plant at Mandya in Karnataka which will mainly cater to the water segment. The Company also commenced operations at the new LSAW plant at Anjar with a capacity of 0.35 million tonnes. The plant will cater to the growing LSAW demand in India and globally towards transportation of offshore Oil and Gas. Meanwhile, to strengthen the management, Mr Braja K Mishra has rejoined the Company as Managing Director, In this Annual Report we have disclosed forward-looking information to enable investors comprehend our prospects and take informed investment decisions. WCL after a brief stint of three years outside Welspun. He We have tried, wherever possible, to identify such statements by using words as brings along with him 25 years of experience with immense 'anticipate', 'estimate', 'expects', 'projects', 'intends', 'plans', 'believes', and words of similar substance in connection with any discussion of the future criticalknow howaboutthepipeandplateindustry. performance. We cannot guarantee that these forward-looking statements will be realized, although we believe we have been prudent in our assumptions. Should known or unknown risks or uncertainties materialize, or should With the Company’s continued focus on excelling in underlying assumptions prove inaccurate, actual results could vary materially every sphere of its operations and generating from those anticipated, estimated or projected. Readers should bear this in sustainable value for its customers and stakeholders, it is mind. We undertake no obligation to publicly update any forward-looking statements, whetheras a result of new information, future events or otherwise. sure to reach to stronger heights in the years ahead. C rp Ltd CORPORATE INFORMATION IMPORTANT CHANGES AND DEVELOPMENTS Company Identification Number L27100GJ1995PLC025609 Par Value / Share Rs 5/ each YEAR Date of Incorporation 26th April 1995 Securities Registrar & Transfer Agent 2012 Initiated new ERW mill of 175,000 MTPAin Little Rock, Arkansas, US. Date of Being Listed on Stock Exchange BSE 27th March 1997 Link Intime India Private Ltd 50,000 MTPAcapacity expansion of the already existing 100,000 MTPAHSAW capacity in Mandya, Karnataka. NSE 4th December 2003 C 13, Pannalal Silk Mills 2011 Welspun Corp Limited acquired 87.35% stake in Welspun Maxsteel Limited (WMSL) from its group company, Welspun Type of Business Manufacturing of Steel Pipes, Coils and Plates, Power Compound, LBS Marg, Steel Limited as on 18th Aug 2011. Registered Capital Rs 2500 million Bhandup (West), Insight Solutions Limited has acquired 12.5% of the equity of WMSL from Welspun Steel Limited, while Paid Up Capital Rs 1138 91 million divided into 227,781,035 equity Mumbai 400078 Grasim Industries Limited has acquired the remaining 0.15% equity in Welspun Maxsteel Limited. shares of Rs 5/ each fully paid up WCL raised $290 million in the form of GDRs (US $115 million) issued to Insight Solutions Limited & CCDs (US $175 ---- ------------ ----------- ------------ ----------- ----------- ------------ ----------- ------------ ----------- ------------ ----------- ------------ ----------- ----------- ------------ ----------- ------------ ----------- ----------- ------------ ----------- ------------ - million) issued to Granele Limited. Board of Directors Saudi plant commenced production. Mr. Balkrishan Goenka Mr. Raj Kumar Jain L SAW plant at Anjar commissioned. ()Executive Chairman (Director) Welspun Middle East established its presence in Dubai to cater to the bouyant markets of Middle East and Africa. Mr. Braja Mishra Mr. K.H. Viswanathan Acquired 35% stake in Leighton Contractors (India) Private Limited (renamed as Leighton Welspun Contractors Private ()Managing Director (Director) Limited) Mr. Rajesh R. Mandawewala Mr. Ram Gopal Sharma Awarded "EEPC Top Exporter for the Year2011" Gold Trophy (Director) (Director) Awarded "IACC Best Indian Manufacturing Company in the US 2011" Mr. Mukul Sarkar Mr. Nirmal Gangwal (Nominee Director of Exim Bank Ltd ) (Director) 2010 Initiated capacity expansion in India of LSAW by 350,000 MTPAin Anjar, Gujarat, HSAW by 100,000 MTPAin Mandya near Mr. Mintoo Bhandari Bangalore. (Nominee Director of Insight Solutions Ltd ) ---- ------------ ----------- ------------ ----------- ----------- ------------ ----------- ------------ ----------- ------------ ----------- ------------ ----------- ----------- ------------ ----------- ------------ ----------- ----------- ------------ ----------- ------------ - Fund raising of US$ 250 million of which US$ 150 million was raised through FCCB (Foreign Convertible Currency Bonds) - ------ ------ ------ ------ ------ ------ ------ ------ ------ ------ -- Chief Financial Officer Bankers in Oct 2009 and $ 100 million through QIP (Qualified Institutional Placement) in Nov 2009. Mr Brijgopal Jaju Andhra Bank Foray into the world of infrastructure by way of investment in Welspun Projects Limited (formerly known as MSK ---- ------------ ----------- ------------ ----------- ----------- ------------ ----------- ------------ ----------- ------------ ------------ Projects India Ltd.) Bank of Baroda Company Secretary Bank of India Completed investment in Middle East company with 300,000 MTPAHSAW facility in Saudi Arabia. Mr Pradeep Joshi Canara Bank Change in name of Welspun Gujarat Stahl Rohren Limited to “Welspun Corp Limited” w.e.f. 27/04/2010. ---- ------------ ----------- ------------ ----------- ------------------------ ----------- ------------ ----------- ------------ ------------ Citibank N A Auditors 2009 Commissioning of the US Pipe Mill in Little Rock Arkansas, with the capacity