Dear Shareholders,

It gives me great pleasure to share with you the company’s performance during the year 2009-10. We have lived up to the stringent standards that Global Coke has set for itself, often surpassing our own yardsticks.

Globally Metallurgical Coke is a product that is in short supply. As India presses the fast forward button for economic development, her need for steel will skyrocket. Buoyed by this surge in demand for steel, the demand for good quality met coke too will be on the rise. And this rise in demand in its wake will give rise to all sorts of challenges. We have to prepare ourselves to meet the challanges for the sake of the prosperity of the Nation which is something that we cannot compromise.

The First Challenge will be that of procurement. It is heartening that we at Global Coke have been able to meet this challenge successfully and have totally secured our supplies. However, not content with what we already have, we have initiated a series of steps aimed at securing our future needs as well. Our Singapore office, opened during the year is also one of the steps aimed at this end.

The Second Challenge will be on the production front – to produce at optimal levels, keeping a firm control over the costs and while doing so, ensure that we do not harm the environment within which we operate. As part of this exercise, we are setting up power plants for the co generation of electricity. These plants will use the waste heat emanating from the coke making process to generate electricity and will, in the process put a cap on a valuable national resource. We have also undertaken aggressive programmes of plantation which will help us reduce our carbon footprint substantially.
The Third Challenge, perhaps the most difficult of all, will be to act as an ethical corporate citizen. One who embraces inclusive growth – creating wealth and cleaning the Augean Stables simultaneously. Our industry has some peculiar characteristics – growing demand, wild cyclical swings in prices, obstacles of procurement, scattered and fragmented production base, lack of industry leaders with no well defined benchmarks– which makes the domain far from perfect in terms of transparency and ethicality. It will be our honest endeavour not only to provide the industry with the bold leadership that it deserves, but also to chart the path for its long term sustainability and success.

The Fourth Challenge will be on the front of marketing. We have already established long term relations based on mutual trust and respect with our buyers and will strive to strengthen our bonds further. We also have excellent professional relationship with our co creators on the logistics side as with the various departments we deal with. We have curved a niche out for ourselves – as an entity that is moored firmly on ground, an entity that is transparent in its dealings and is an upright and honest company, focused on the creation of wealth, adding value to nature’s bounty.
We foresee a period of consolidation in the industry as more and more small and marginal players will come together under the banner of a unified command giving it the economies of scale. Such an unit will also carry a heavier weight with the suppliers and will be in a position to streamline operations. Global Coke will strive to attain that leadership status and the years ahead will be crucial as we give shape to our dreams.

We live in exciting times and it is perhaps divine ordain that we are in the industry segment that we are in. Metallurgical Coke, as we all know will be the chosen fuel to smelt that Nation’s progress and as a key player in the segment, Global Coke will play a crucial role as India transforms into a developed nation, an economy on the better side of the divide.

At Global Coke we are aware of what the Nation wants from us and are fully geared to perform and live up to the expectations. Let me welcome you all on this epic march forward as we create wealth and history in the process.

Thank You,

Devendra Kumar Ojha
Chairman

1. After overcoming the impact of the global recession the Company started operating in full swing its installed capacities of 12000MT/month in Jamnagar.
2. In May 2009 the company acquired more than 8 acres of additional land adjacent to the existing factory in Jamnagar.
3. After completing registration of the newly acquired land at Jamnagar, the Company started its program for expansion of capacities by additional 13000MT/ month.
4. The project has been funded through share capital, utilization of internal accruals, unsecured loans and some term finance from the Company’s bankers State Bank of India, Kolkata.
5. In August the company acquired and added similar coke making capacities of 13000MT/month at Sindhudurg, Maharashtra by directly paying off the bankers of sick company M/ s Hari Om Metcoke Ltd under OTS scheme along with an office at Panjim, Goa. The decision to acquire the unit was based on 2 basic criteria, namely: (a) the strategic location of the unit in terms of easy availability of raw material from nearby port as well as a huge ready market consisting of large corporate buyers in the immediate vicinity, and (b) the clearance from Pollution Control Board which the unit enjoys for its existing operations as well as future expansions as against total ban imposed by PCB on entry of new coke manufacturers in the area.
6. Though initially Sindhudurg acquisitions were entirely funded by the Company from its own sources, a portion of the Company’s acquisition expenditure was subsequently reimbursed through Term Loan from Corporation Bank.
7. Half of the plant capacity i.e. 6500MT/ month at Sindhudurg has been operative since mid-January 2010. Additional capacity of 13000MT/ month shall become operative from July 2010 at Jamnagar and the second battery having capacity 6500MT/month at Sindhudurg will also be put to commercial use by June 2010. Thus from July 2010 the Company shall be operating capacities upto 37000MT/month- i.e. 25000MT/month at Jamnagar and 12000MT/month at Sindhudurg.
8. Through strict adherence to its commitments in all transactions, the Company has established its credentials amongst reputed international coking coal suppliers. This has helped the Company in securing commitments from such suppliers for long-term supply of coal.
9. Apart from its core activity of manufacturing LAM coke, the Company has also engaged in some trading of coal, which has contributed to roughly 16% of the annual turnover for 2009-10.
10. The Company reported Gross sales of Rs 349.23 crores in the 12 months ended March 31, 2010 as against Rs 207.61 crores during previous year ended March 31, 2009, representing an annual increase of around 68.21% in turnover. During the same period the Company reported a net profit of Rs 12.69 crores (previous year Rs 4.59 crores). The Company comfortably surpassed its sales targets for the financial year (actual sales Rs 349.23 crores against target Rs 229.00crores) made by its Bankers at the time of sanction of working capital limits (based on only 75% capacity utilization), profitability has also substantially improved through best of collective management efforts under improved market conditions.
11. We have entered into long-term supply contracts for the next 3 years with 3 large industrial houses for almost 90% of our total production capacity for 2010-11. This decision will help us guard against market volatility.

As reported earlier the Company has well drawn long term plans of backward and forward integration. From May 2010 onwards the Company schedules implementation of the next phase of its long-term plans, namely:

(1) Expansion of coke making capacity by additional 13000MT/month at Sindhdurg, such that by April 2011 company has a total manufacturing capacity of 25000MT/ month at Sindhudurg in addition to 25000MT/month at Jamnagar. As in the past all coke-oven expansion work shall be undertaken under the guidance of our technical director Dr.S.K.Hazra.

(2) Setting up of a 12MW co-gen power plant at Jamnagar which shall be run by utilizing waste heat generated out of coke-manufacturing.

(3) Setting up of a 12MW co-gen power plant at Sindhudurg which shall be run by utilizing waste heat generated out of coke-manufacturing.

Detailed cost estimates as well as future projections have been prepared by the Company as well as their appointed consultants for the power projects.

The Company has formally submitted its proposal for credit facilities to its bankers.

A new member bank has been added to its consortium of bankers namely Punjab National Bank, Kolkata.

Reason for Undertaking Expansion Project at Sindhudurg:

To maintain continuous supplies of meaningful quantities to only a few out of the large customer list, undertaking the expansion program is the need of the hour. Huge expansions of steel-making capacities in the West coast by a number of large corporate houses have added to the demand- supply gap of the coke industry in the region.

Reason for Undertaking Co-gen Power Project at both the sites:

Like most merchant coke- oven plants in this country we have been releasing the waste heat generated through the carbonization of coal into the atmosphere through very high chimneys as per PCB norms. However such a practice is not only polluting the atmosphere, it also implies unwise wastage of a precious natural resource -coal. We propose to utilize such waste heat to produce electricity. It will not only reduce air pollution, the Company shall also be able to contribute its rights in bringing down the national shortage of power. In the process the Company shall earn a monthly cash revenue of around Rs.2.00crores after some fixed revenue expenditure like operation & maintenance work, depreciation and interest on capital investments (raw material cost is nil). Under normal circumstances, the entire investment towards setting up the power plants will be paid back in 3 years post gestation period of 18-24months.

Pursuant to the requirements under Section 217(2AA) of the Companies Act, 1956 in respect to Directors’ Responsibility Statement, the Board of Directors of the Company affirms:

i. that in the preparation of the annual accounts for the financial year ended March 31, 2010, the applicable accounting standards have been followed and that no material departures were made from the same;

ii. that the selected accounting policies were applied consistently and the directors made judgments and estimates that are reasonable and prudent so as to give true and fair view of the state of affairs of the Company at the end of the year under review and of the profit of the Company for the year ended on that date;

iii. 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; and

iv. that the annual accounts have been prepared on a going concern basis for the financial year ending March 31,2010.