SKM Egg Products Exp India Ltd-532143-March-2008

THIRTEENTH ANNUAL REPORT
2007-2008
• Excellence - Our Goal

SKM EGG PRODUCTS
T H I N K I N G O U T O F T H E
• Service - Our Motto
Tel: +91 424 23 51 532-34 185, Chennimalai Road, Erode.
Fax: +91 424 23 51 530-31 Tamilnadu,lndia.Pin:638001
• Quality - Our Obsession E-mail: finance@skmegg.com Website: www.skmegg.com
' I 1 '! 1
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Silver Trophy Award from APEDA

for the year 2006-2007
m
for quality and export promotion.
Silver Award from Frost & Sullivan

The award acknowledge the best facilities
in India that have achieved and sustained
manufacturing excellence
Silver Trophy Award from APEDA

for the year 2005-2006
for quality and export promotion.
SKM EGG PRODUCTS EXPORT (INDIA) LIMITED
185, Chennimalai Road, Erode - 638 001
BOARD OF DIRECTORS Shri. SKM. MAEILANANDHAN

Executive Chairman
Shri. SKM. SHREE SHIVKUMAR

Managing Director
Dr.M.CHANDRASEKAR
Shri. B. RAMAKRISHNAN
(TIDCO Nominee)
Shri. S.M. VENKATACHALAPATHY
Dr. L.M.RAMAKRISHNAN
Shri. M. CHINNAYAN
Shri. P.KUMARASAMY
MANAGEMENT EXECUTIVES
GENERAL MANAGER - FINANCE Shri. V. JAGADEESAN, B.Sc, A.C.A., A.I.C.W.A., A.C.S.
& COMPANY SECRETARY
GENERAL MANAGER - OPERATIONS Shri. S. HARIHARAN, B.Sc, B.Tech., (Food Tech.
AUDITORS N.C.RAJAGOPAL & CO.,

Chartered Accountants,
199, Agraharam Street,
ERODE-638 001.
BANKERS STATE BANK OF INDIA

Commercial Branch,
ERODE-638 003.
REGISTERED OFFICE 185, Chennimalai Road,

Erode - 638 001.
ERODE DISTRICT.
FACTORY Erode to Karur Main Road,

Cholangapalayam,
Punjai Kilambadi Village,
ERODE DISTRICT - 638 154.

185, Chennimalai Road, Erode - 638 001
NOTICE TO MEMBERS
Notice is hereby given that the Thirteenth Annual General Meeting of the Members of the Company will be held on
09.09.2008 at 4.00 p.m at Kongu Kalaiarangam, E.V.K.Sampath Nagar, Erode - 638 011 to transact the following
business:
ORDINARY BUSINESS:
1. To receive, consider and adopt:
a. The audited Profit and Loss Account for the year ended 31 st March 2008.
b. The audited Balance Sheet as at 31 sl March, 2008.
c. The Director's and Auditor's Report thereon.
2. To declare a dividend lor the year 2007 - 2008. The Directors recommended dividend of 5% on the equity
shares for the accounting year 2007 - 2008.
3. To appoint a Director in the place of Dr. L.M. Ramakrishnan, who retires by rotation and being eligible,
offers himself for re-appointment.
4. To appoint a Director in the place of Shri M. Chinnayan, who retires by rotation and being eligible, offers
himself for re-appointment.
5. To appoint Auditors to hold office from the conclusion of this Annual General Meeting till the conclusion of
the next Annual General Meeting and to fix their remuneration. The retiring Auditors M/s N.C.Rajagopal &
Co., Chartered Accountants are eligible for re-appointment and confirmed their willingness to accept the
office, if re-appointed.
SPECIAL BUSINESS:
6. To consider and if thought fit to pass the following resolutions with or without modification(s) as an Ordinary
Resolution:
"RESOLVED THAT pursuant to Section 309 read with Section 198 and Schedule XIII and other applicable
provisions, if any, of the Companies Act, 1956, and in partial modification of the resolution approved by the
shareholders in the Annual General Meeting of the company held on 11 th day of September, 2007 the
remuneration payable to Shri SKM. Maeilanandhan, Executive Chairman be and is hereby revised, with
effect from 1st April 2008, by means of payment of additional remuneration in the form of commission at
the rate of 3% on the net profit of the company calculated in accordance with the provisions of Sections
198, 349 and 350 of the Companies Act, 1956.
"RESOLVED FURTHER THAT other terms and conditions of appointment of Shri. SKM. Maeilanandhan as
Executive Chairman approved by the shareholders in the Annual General Meeting held on 11 th September
2007, reproduced below for ready reference, shall remain unchanged :
i. Basic Pay Rs. 1,90,000/- per month.
ii. House Rent Allowance at 20% of the basic pay.
iii. Reimbursement of Medical Expenses for self and family.

iv. Reimbursement of expenditure incurred towards (not exceeding 10% of the Basic Pay) gas,
electricity, water and furnishing.
v. Payment of club fees, other than admission and life membership fees, subject to a maximum of
two clubs.
vi. Personal Accident Insurance Premium upto Rs. 10,000/- per annum.
vii. Leave Travel Concession for self and family members according to the rules of the company.
viii. Shri SKM. Maeilanandhan shall be eligible to the following perquisites, which shall not be included
in the computation of remuneration specified above
a. Company's contribution to Provident Fund, Superannuation Fund or Annuity fund as per the
Rules of the Company to the extent these either singly or put together are not taxable under
the Income Tax Act, 1961.
b. Gratuity payable at a rate not exceeding half a month's salary for each completed year of
service.
c. Encashment of Leave at the end of the tenure.
ix. The Company shall provide a car for official use on Company's business and telephone at the
residence of Shri SKM. Maeilanandhan.
"RESOLVED FURTHER THAT in the event of absence or inadequacy of profits in any year, the above
remuneration, perquisites and benefits be paid to Shri SKM. Maeilanandhan as minimum remuneration
subject to the provisions of Section II(A) of Part II of Schedule XIII to the Companies Act, 1956."
7. To Consider and if thought fit to pass the following resolutions with or without modifications as an Ordinary
resolution.
"RESOLVED THAT pursuant to Section 309 read with Section 198 and Schedule XIII and other applicable
provisions, if any, of the Companies Act, 1956, and in partial modification of the resolution approved by the
shareholders in the Annual General Meeting of the company held on 16th day of September, 2006 the
remuneration payable to Shri SKM. Shree Shivkumar, Managing Director be and is hereby revised, with
effect from 1st April 2008, in the following manner.
a. Basic Pay is proposed to be revised to Rs.1,80,000 per month from the existing Basic Pay of
Rs.1,30,000 per month.
b. Commission is proposed to be paid at the rate of 3% on the Net Profit of the company
calculated in accordance with the provision of Sections 198, 349 and 350 of the Companies
Act, 1956.
"RESOLVED FURTHER THAT other terms and conditions of appointment of Shri. SKM. Shree Shivkumar
as Managing Director approved by the shareholders in the Annual General Meeting held on 16th September
2006, reproduced below for ready reference, shall remain unchanged :
i. House Rent Allowance at 20% of the Basic pay.
ii. Reimbursement of Medical Expenses for self and family.
iii. Reimbursement of expenditure incurred towards (not exceeding 10% of the Basic Pay) gas,
electricity, water and furnishing.
iv. Payment of club fees, other than admission and life membership fees, subject to a maximum of
two clubs.
v. Personal Accident Insurance Premium upto Rs.10,000/- per annum.
vi. Leave Travel Concession for self and family members according to the rules of the Company.
vii. Shri SKM. Shree Shivkumar shall be eligible to the following perquisites, which shall not be
included in the connputation of remuneration specified above.
a. Company's contribution to Provident Fund, Superannuation Fund or Annuity Fund as per the
Rules of the Company to the extent these either singly or put together are not taxable under
the Income Tax Act, 1961.
b. Gratuity payable at a rate not exceeding half a month's salary for each completed year of
service.
c. Encashment of Leave at the end of the tenure.
viii. The Company shall provide a car for official use on Company's business and telephone at the
residence of Shri SKM. Shree Shivkumar.
"RESOLVED FURTHER THAT in the event of absence or inadequacy of profits in any year, the above
remuneration, perquisites and benefits be paid to Shri SKM. Shree Shivkumar as minimum remuneration
subject to the provisions of Section II(A) of Part II of Schedule XIII to the Companies Act, 1956."
By order of the Board
V. JAGADEESAN.
Place: Erode GENERAL MANAGER - FINANCE
Date : 28.07.2008 & COMPANY SECRETARY
Notes:
1. A Member entitled to attend and vote at this Annual General Meeting may appoint a proxy to attend
and vote on his/her behalf. A proxy need not be a member of the Company. The instrument appointing
the proxy duly completed shall be deposited at the Registered Office at 185 - Chennimalai Road,
Erode - 638001 not later than 48 hours before the scheduled time of the meeting.
2. Explanatory Statement pursuant to Section 173(2) of the Companies Act,1956 in respect of Special
Business as set out above is annexed hereto.
3. The Register of Members, Share Transfer Books will remain closed from 01.09.2008 to 09.09.2008
(both days inclusive) for the purpose of payment of dividend, if any, approved by the Members.
4. Consequent upon introduction of Sec 109A of the Companies Act,1956, shareholders are entitled to
make nomination in respect of shares held by them. Shareholders desirous of making nominations
are requested to send their request in FORM 2B to the Registrar and Transfer Agents, M/s S.K.D.C
Consultants Ltd., RB.NO: 2979, No.7 (Old No.11), Seth Narayandoss Layout, Street No.1, (West
Power House Road), Tatabad, Coimbatore-641012.
5. Members holding shares in DEMAT form are requested to incorporate Client ID Number and DPID
Number in the attendance slip/proxy form for easy indentification.
6. All documents referred to in the accompanying Notice and Explanatory Statement are available for
inspection at the Registered Office of the Company on all working days between 11.00 a.m and 2.00
p.m up to the date of the Annual General Meeting.
7. Pursuant to the provisions of Section 205A read with Section 205C of the Companies Act,1 956,
as amended, any dividend which remains unpaid/unclaimed for a period of 7 years will be transferred
to the Investor Education and Protection Fund of the Central Government. Shareholders who have
not encashed dividend warrants) so far for the Financial year ended 31st March 2004, 31st March
2005, and 31 st March, 2006,31 st March, 2007 are requested to approach the company for obtaining
payments thereof.
8. Members are requested to notify any change in their address, mandate etc to:
(i) the Company's Registrar and Transfer Agents, M/s S.K.D.C Consultants Ltd., P.B.NO:
2979, No.7 (Old No.11), Seth Narayandoss Layout, Street No.1, (West Power House
Road), Tatabad, Coimbatore-641012 in respect of shares held in physical form.
(ii) their Depository Participants (DPs) in respect of shares held in dematerialized form.
9. Brief particulars of Directors proposed for re-appointment of Directors are given in REPORT ON
CORPORATE GOVERNANCE.
By order of the Board
V. JAGADEESAN.
Place: Erode GENERAL MANAGER - FINANCE
Date : 28.07.2008 & COMPANY SECRETARY
ANNEXURETOTHE NOTICE
EXPLANATORY STATEMENT PURSUANTTO SECTION 173(2) OFTHE COMPANIES ACT, 1956
Item No: 6
In the Twelveth Annual General Meeting of the company held on 11 th Septmeber,2007 the consent of members
was obtained for payment of remuneration to the Executive Chairman Shri. SKM. Maeilanandhan at the revised
basic Pay of Rs. 1,90,000/- per month with usual allowances and benefits as against the basic pay of Rs.1,50,000/
- per month with usual allowances and benefits. Shri. SKM. Maeilanandhan for the first time received remuneration
in the financial year 2006-07 and in the earlier years he did not receive any remuneration from the company in
view of the prevailing financial crisis due to incurring of losses. Under the stewardship of Shri. SKM. Maeilanandhan,
the turnover of the company during this financial year 2007-08, for the first time crossed Rs.100 crore and the
company earned excellent profit in spite of substantial increase in raw material cost and adverse foreign exchange
market environment. Considering the valuable contribution made by Shri. SKM. Maeilanandhan as the Executive
Chairman of the company to the growth of the company,it was proposed to revise the remuneration being paid to
him. The Remuneration Committee of the Board of Directors in its meeting held on 28th April,2008 has recommended
for payment of commission at the rate of 3% on the net profit of the company in addition to the remuneration
previously approved by the members at the Annual General Meeting held on 11 th September, 2007 (i.e) a basic
pay of Rs.1,90,000 per month and other usual benefits and allowances. The Board of Directors at its meeting held
on 28th April,2008 accepted the recommendation of the remuneration committee and approved revision of
remuneration payable to Shri. SKM. Maeilanandhan with effect from the Financial Year commencing on or after 1 sl
April 2008 subject to approval of the members in the ensuing Annual General Meeting. The remuneration proposed
for payment to the Executive Chairman Shri. SKM. Maeilanandhan is reasonable considering the growth and
volume of business of the company. The Board of Directors recommend the resolution to the members for
approval.The proposed revision of remuneration to Shri. SKM. Maeilanandhan is in conformity with the requirement
of Schedule XIII of the Companies Act'1956.
This explanatory statement together with the accompanying notice may be treated as an abstract of the terms
of remuneration payable to Shri. SKM. Maeilanandhan, pursuant to Section 302 of the Companies Act,1956.
Memorandum of Interest of Directors.
Shri. SKM. Maeilanandhan is interested in this resolution as it concerns revision of his remuneration.
Shri. SKM. Shree Shivkumar and Dr. M. Chandrasekar are interested in this resolution as relatives of
Shri. SKM. Maeilanandhan.
Item No: 7
In the Eleventh Annual General Meeting of the company held on 16th September,2006 members appointed Shri.
SKM. Shree Shivkumar as the Managing Director for a period of 5 years from 26.06.2006 to 25.06.2011 and also
approved for payment of remuneration to Shri. SKM. Shree Shivkumar consisting of Basic Pay of Rs. 1,30,000
per month with usual allowances and benefits.The company is continue to make new milestone in its performance
due to the valuable contribution made by Shri. SKM. Shree Shivkumar. The dynamism of Shri. SKM. Shree
Shivkumar in making key business decisions help drives the company to grow well even during the periods where
there is an adverse business and economic environment. Shri. SKM. Shree Shivkumar has taken tremendous
efforts in identifying new markets and customers which resulted in demand for the company's products far
exceeded its production capacity and the turnover of the company, during this year, registered a robust growth of
20%. In order to suitably compensate for the contributions made by Shri. SKM. Shree Shivkumar, it was proposed
to revise the remuneration being paid tq Shri. SKM. Shree Shivkumar. The Remuneration Committee of the Board
of Directors in its meeting held on 28th April,2008 has recommended for revision of remuneration payable to Shri.
SKM. Shree Shivkumar to Rs. 1,80,000 per month with usual allowances and benefits and for payment of commission
at the rate of 3% on the net profit of the company as against the remuneration previously approved by the
members at the Annual General Meeting held on 16th Septmebr,2006 (i.e) a basic pay of Rs. 1,30,000 per month
and other usual benefits and allowances.The Board of Directors at its meeting held on 28m April,2008 accepted
the recommendation of the remuneration committee and approved revision of remuneration payable to Shri.
SKM. Shree Shivkumar with effect from the Financial Year commencing on or after 1 st April 2008 subject to
approval of the members in the ensuing Annual General Meeting.The remuneration proposed for payment to the
Managing Director Shri. SKM. Shree Shivkumar is reasonable considering the overall performance of the company.
The Board of Directors recommend the resolution to the members for approval. The proposed revision of
remuneration to Shri. SKM. Shree Shivkumar is in conformity with the requirement of Schedule XIII of the Companies
Act'1956.
This explanatory statement together with the accompanying notice may be treated as on abstract of the terms of
remuneration payable to Shri SKM. Shree Shivkumar, pursuant to Sec.302 of the Companies Act' 1956.
Memorandum of Interest of Directors.
Shri. SKM. Shree Shivkumar is interested in this resolution as it concerns revision of his remuneration. Shri.
SKM. Maeilanandhan and Dr. M. Chandrasekar are interested in this resolution as relatives of
Shri. SKM. Shree Shivkumar.
SHAREHOLDERS' INFORMATION
Date and Venue of Annual General Meeting
On Tuesday the 9th September, 2008 at Kongu Kalaiarangam, E.V.K. Sampath Nagar, Erode - 638011.
Tentative Financial Calender:
Fourth quarter and Unaudited results 2007-2008 : April 28, 2008.
First quarter results for 2008-2009 and audited results for 2007-2008 : 28.07.2008
Thirteenth Annual General Meeting : 09.09.2008
Second quarter results for 2008-2009 : on or before October 31,2008.
Third quarter results for 2008-2009 : on or before January 31,2009.
Date of book closure : 01.09.2008 to 09.09.2008
Listing on Company's Equity Shares

The Bombay Stock Exchange Limited Madras Stock Exchange Ltd
Phiroze Jeejeebhoy Towers Exchange Building
Dalai Street Post Box No. 183, Second Line Beach
Mumbai-400 001. Chennai-600 001.
National Stock Exchange of India Ltd Coimbatore Stock Exchange Ltd
Exchange Plaza, S^.FIoor Stock Exchange Building
Bandra - Kurla Complex Trichy Road
Bandra (E) Coimbatore - 641 005.
Mumbai-400 051.
In the Eleventh Annual General Meeting of the company, special resolution was passed for delisting the shares of
the company from Madras and Coimbatore Stock Exchanges. The company informed the decision of the
shareholders to the above two stock exchanges and the stock exchanges are yet to inform the company about
their formalities for delisting.
Annual listing fees has been paid to all Stock Exchanges for the year 2008-09 except to Coimbatore Stock
Exchange and Madras Stock Exchange.
Share Price Movements
The high and low prices of the Company's share on the Bombay Stock Exchange Limited and the National Stock
Exchange between April, 2007 and March, 2008 are as under:
Month Bombay Stock Exchange Limited National Stock Exchange Limited

High Low Quantity High Low Quantity
Apr-2007 20.85 18.25 76,481 20.95 18.00 1,22,852
May-2007 22.00 18.15 56,665 20.40 18.00 1,16,453
Jun-2007 21.10 18.00 63,825 20.70 18.10 1,73,110
Jul-2007 19.35 17.60 97,647 21.90 16.15 2,16134
Aug-2007 19.90 15.10 92,407 18.00 16.70 1,48,645
Sep-2007 22.00 17.00 2,59,103 21.95 16.70 5,15,191
Oct-2007 20.00 15.60 1,09,958 19.90 15.15 2,69,159
Nov-2007 20.00 15.05 3,20,216 19.95 15.00 5,09,149
Dec-2007 25.95 17.00 6,36,732 22.70 16.90 8,92,593
Jan-2008 43.50 18.25 23,00,802 43.45 18.40 35,24,226
Feb-2008 21.80 16.50 1,32,967 21.15 16.65 2,56,188
Mar-2008 18.00 13.35 1,66,507 18.45 13.40 2,04,917
43.50 13.35 43,13,310 43.45 13.40 69,48,617
8
Stock Code:
National Stock Exchange of India (NSE) SKMEGGPROD
The Bombay Stock Exchange Ltd 532143
NSDL&CSDL INE411 D1015
The Equity Shares of the company are under the process of delisting from the Madras Stock Exchange Ltd and
the Coimbatore Stock Exchange Ltd.
Share Transfer System:

The Board delegated its authority to transfer shares to Committee of Directors called as Share Transfer Committee.
The details of share transferred are being placed before the Board of Directors and duly ratified. The Committee
oversees transfers, transmissions, dematerialisation, rematerialisation of shares and issue of duplicate share
certificates.
Compliance Officer:
V. JAGADEESAN,
General Manager (Finance) and Company Secretary,
M/s.SKM Egg Products Export (India) Limited,
185, Chennimalai Road, Erode - 638 001.
Distribution of shareholding as on :
31.03.2008 31.03.2007
No. of
Equity Shares No. of %of No. of %of No. of %of %of
No. of
held Share Shares Shares Share Share Shares Share
Shares held
holders held held holding holders held holding
1-500 6,895 68.67 21,48,351 8.16 5,954 66.02 20,14,477 7.65
501-1000 1,628 16.21 13,97,112 5.31 1,553 17.22 13,27,926 5.04
1001-2000 427 4.25 6,57,241 2.50 386 4.28 5,90,119 2.24
2001-3000 721 7.18 17,90,020 6.80 774 8.58 19,20,672 7.29
3001-4000 54 0.54 1,95,969 0.74 51 0.57 1,80,711 0.69
4001-5000 152 1.51 7,40,858 2.81 148 1.64 7,23,558 2.75
5001-10000 99 0.99 7,89,256 3.00 93 1.02 7,51,171 2.85
10001 & above 65 0.65 1,86,11,193 70.68 60 0.67 1,88,21,366 71.49
Total 10,041 100.00 2,63,30,000 100.00 9,019 100.00 2,63,30,000 100.00

Registrar and Transfer Agent

M/s. S.K.D.C Consultants Limited, RB.No.2979, No.7 (Old No.11), Seth Narayandoss Layout, Street No.1, (West
Power House Road),Tatabad, Coimbatore-641012, Phone: 0422-2499803,2499804, Fax: 0422 - 2499574 is the
Share Transfer Agent for Physical and Electronic transfer of Company's Shares.
Categories of shareholding as on :
31.03.2008 31.03.2007
No. of %of No. of %of No. of %of %of
Category No. of
Share Shares Shares Share Share Shares Share
Shares held
holders holders held holding holders held holding
Promoters 12 0.12 1,62,84,182 61.85 14 0.12 1,65,99,604 63.04

Corporate 280 2.79 6,98,885 2.65 180 2.00 2,61,639 1.00
Individuals 9,710 96.70 80,76,499 30.67 8,794 97.54 80,98,800 30.76
NRIs/OCBs 39 0.39 12,70,434 4.83 31 0.34 13,69,957 5.20
TOTAL 10,041 100.00 2,63,30,000 100.00 9,019 100.00 2,63,30,000 100.00
Dematerialisation of shares:
As per SEBI's instruction the Company's Equity Shares can be sold through Stock Exchanges only in
Dematerialised form.
Extent of Dematerialisation as on 31.03.2008
Name of the Depository No.of Shares %
National Securities Depository Ltd 55,92,920 21.24
Central Depository Services (India) Ltd 1,43,50,186 54.50
Total 1,99,43,106 75.74

Plant location:
Cholangapalayam
Erode - Karur Main Road
Pasur Post
Erode District
Pin-638154.
Registered Office and Address for Correspondence:
Due to Administrative reasons the company shifted the Registered Office at 156, Gandhiji Road, Erode
638001 to the following new address.
185 - Chennimalai Road

Erode-638001.
Phone: (0424) 2262963
Fax:(0424)2258419
e-mail: shares@skmegg.com
Place: Erode SKM. MAEILANANDHAN

Date : 28.07.2008 EXECUTIVE CHAIRMAN
10
DIRECTORS' RE-PORT AND MANAGEMENT ANALYSIS
Your directors are pleased to present the THIRTEENTH ANNUAL REPORT and the audited accounts of the
company for the year ended March 31,2008.
FINANCIAL HIGHLIGHTS
Rs. in lacs
DESCRIPTION 2007-2008 2006-2007
Net Sales 10,669.48 8,838.39

Profit Before Interest and Depreciation 1,520.54 1,600.54
Less : Interest 289.00 223.95
Depreciation 307.58 278.98
Profit before tax 923.96 1097.62
Less : Provision for Taxation 82.19 15.10
Profit after tax and available for appropriation 841.77 1082.51
APPROPRIATIONS:
Proposed dividend 131.65 131.65
Corporate dividend tax 22.37 22.16
Balance carried to Balance Sheet 687.75 928.71
DIVIDEND
Your directors are happy to recommend dividend of 5% amounting to Rs. 154.02 lakhs (including dividend distribution
tax) for the accounting year 2007-08.
REVIEW OF PERFORMANCE
Your directors are pleased to inform that turnover of the company during the year crossed Rs. 100 crore mark for
the first time and touched Rs.106.69 crores as against previous year turnover of Rs. 88.39 crores thereby registering
a growth of 20%. However the growth in sales did not transcend into profit of the company due to significant
increase in the raw material price. The average raw material price during the year under review was at Rs.1.63 per
egg which is more by 19% over the previous years weighted average price of Rs.1.37 per egg.
There was a significant growth in the egg powder production and quantity of egg powder sold during this year
under review over the previous year. During this year under review the company produced 4572 MT and sold 5007
MT of egg powder compared to the previous year's production and sale of 4525 MT and 4580 MT respectively.
Your directors are delighted to inform that the company's performance during this year surpassed past records in
terms of turnover and quantity of egg powder produced and sold.
INDUSTRY OVERVIEW
Egg processing industry is a raw material intensive industry and hence fluctuation is egg price widely influence
cash position and operating margin of this industry. Except during the last two months of the year under review,
the egg price was ruling at high throughout the year and this factor had a substantial adverse effect on the bottom
line of the company for this year. Also Indian egg processing industries do not have any domestic market for
processed eggs and therefore the performance of the company is having a direct correlation to the performance
of the global economy. The slow down in the performance of the US economy resulted in appreciation of Indian
Rupee against US dollar and as a consequence the operating profit of the company during this year was lower
against the previous year.
11
PROSPECTS FORTHE FINANCIAL YEAR 2008-09:

The preformance of the company for financial year under review (Financial Year 2007 - 2008) had been adversely
affected due to appreciation of rupee. There is a welcome sign in the exchange rates between rupee and other
major currencies in the first part of this current financial year 2008-09 and this is expected to compensate to a
little extent the loss due to escalation in raw material price. In the last union budget, the Government of India has
doubled the custom duty on sale of goods from EOU's to Domestic Tariff Area (DTA) from 25% to 50% in addition
to the 100% additional custom duty paid on such sale. In view of this net selling price of company's product to
DTA became costly. The increased feed ingredients cost due to prevailing inflation pushed up egg price considerably
which affects adversely the bottom line of the company. As the raw material price escalated, the company is
taking renewed efforts to sustain competitiveness through improved efficiency.
POULTRY PROJECT:
The implementation of the first phase of the poultry project is in the advanced stage of completion. In the month
of October, 2007, first batch of 50,000 chicks were placed in the farm and during this year under consideration
four batches were placed and 13.30 lakh eggs were received from the farm to the egg processing plant during the
year 2007-08. As the quantity 13.30 lakh eggs received from our farm is very meager comparing to consumption
of eggs, no financial benefit accrued from the poultry division during this year under review. It is expected that
this project would make a significant contribution to the bottom line of the company in the ensuing years. In
addition to the monetary benefits, this project will enable the company's tracking system to extent upto the stage
of feed ingredients level.
SUBSIDIARY COMPANY:
During this year under review the company's marketing subsidiary SKM Europe BV - Netherlands earned a profit
of Euro 11,012. This subsidiary helps the company in a big way in identifying new customers in Europe and
improved the confidence level of customers through timely and qualitative services. The subsidiary is also taking
initiatives to explore into markets which are untapped by the company till now. The Annual Accounts of the
subsidiary company for the financial year under review are attached with this report.
HUMAN RESOURCES:
The company during this year restructured the Human Resources department in tune with growth and the new
activities that the company embarked into. The company recognize the importance of formal training and employees
are encouraged to attend seminars and workshops. During this year a study on organizational climate has been
carried out with the help of an independent consultant and corrective actions were taken to create a favorable
work environment. The company has set up human resource management process for identification and rewarding
of innovating employees, which enables to attract and retain high caliber employees. The relationship between
the company and the employees continued to be cordial throughout this financial year.
DIRECTORS:
The directors, Dr. L.M. Ramakrishnan and Shri M. Chinnayan retire by rotation in the forthcoming Annual General
Meeting. The retiring directors, being eligible, offer themselves for re-appointment.
FIXED DEPOSITS:
The Company has not accepted deposits from the public during the year under review.
CEO/CFO CERTIFICATION:
In compliance with the requirements of Clause 49(V) of the listing agreement entered into with the Stock Exchanges,
the Managing Director and the General Manager - Finance have submitted to the Board a certificate relating to
financial statements and other matters as envisaged in the said clause.
12
DELISTING OF COMPANY'S EQUITY SHARES

In the Eleventh Annual General Meeting of the company, special resolution was passed by the shareholders for
delisting the equity shares of the company from the Madras Stock Exchange Limited and from Coimbatore stock
Exchange Limited. The company immediately sent intimation to the above stock exchanges about the decision
taken by the shareholders towards delisting of the company's equity shares. The Madras Stock Exchange
requested the company to continue listing of the company's equity shares with it which was turndown by the
company. The company did not receive any reply from the Coimbatore Stock Exchange.
DIRECTORS' RESPONSIBILITY STATEMENT:

Pursuant to Section 217(2AA) of the Companies Act,1956 the Directors confirm that:
1. In the preparation of Annual Accounts the applicable Accounting Standards have been followed and
there were no material departures;
2. The Accounting policies selected are being applied consistently and judgements and estimates made
are reasonable and prudent and gives 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;
3. Proper and sufficient care had been taken for the maintenance of adequate Accounting Records in
accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing
and detecting fraud and other irregularities;
4. The Annual Accounts prepared on a going concern basis;
CORPORATE GOVERNANCE:
The Company is committed to adhere to ti ie stipulations set out in the Listing Agreement with Stock Exchange.
A report on corporate governance as stipulated under Clause 49 of the Listing Agreement with Stock Exchanges
forms part of the Annual Report. The Certificate from the Auditors of the Company, M/s. N.C. Rajagopal & Co
confirming compliance of conditions of Corporate Governance stipulated in Clause 49 of the Listing Agreement is
annexed to the Report on Corporate Governance.
AUDITORS:
The Statutory Auditors, M/s N.C. Rajagopal & Co, Chartered Accountants, holds office until the conclusion of the
ensuing Annual General Meeting and are eligible for reappointment. The retiring auditors M/s. N.C. Rajagopal &
Co, Chartered Accountants informed the Company that their reappointment, if made, would be within the prescribed
limits under Section 224 (1B) of the Companies Act, 1956 and they offer themselves for reappointment.
STATUTORY INFORMATION:
Particulars of employees' remuneration u/s 217(2A) of the Companies Act, 1956:
GROSS QUALI- EXPERI- DATE OF PREVIOUS

NAME AGE DESIGNATION
REMUNE- FICA- ENCE IN EMPLOY- EMPLOY-
RATION TION YEARS MENT MENT
Shri. SKM. 64 Executive 29,00,159 SSLC 23 Years 26.06.96 Managing

Maeilanandhan Chairman Director,
SKM Animal
Feeds and
Foods (India)
Ltd.,
13
The information required as per Section 217(1 )(e) of the Companies Act,1956 read with Companies (Disclosure of
Particulars in the Report of the Board of Directors) Rules, 1988 is given in the Annexure forming part of this report.
ACKNOWLEDGEMENT:
Your Directors wish to express their appreciation of the continued co-operation of the Central and State Governments,
bankers, customers, agents and suppliers and also the valuable assistance and advice received from shareholders.
The Directors also wish to thank all the employees for their contribution, support and continued co-operation
throughout the year.
By Order of the Board

Date : 28-07-2008 EXECUTIVE CHAIRMAN
14
ANNEXURE TO THE DIRECTORS' REPORT
Information under Section 217(1 )(e) of the Companies (Disclosure of Particulars in the Report of Board of Directors)
Rules, 1988.
FORM-A
PARTICULARS 2007-2008 2006-2007
(I) POWER AND FUEL CONSUMPTION

(1) Electricity
a. Purchased units (Kwh) 5,387,808 5,756,756
Total Amount (Rs.) 25,553,615 26,938,222
Rate/unit (Rs.) 4.74 4.68
b. Own Generation through Diesel Generator
Units (Kwh) 780,472 348,647
Total Amount 5,611,080 2,488,931
Units per litre of Diesel Oil 3.35 3.20
Cost/Unit (Rs.) 7.19 7.14
(2) Furnace Oil
Quantity (Litres) 522,100 457,221
Total Cost (Rs.) 9,370,333 6,609,023
Average rate (Rs.) 17.95 14.45
(3) Fire wood
Quantity (Metric Tonnes) 11,352 10,373
Total Cost (Rs.) 22,593,104 19,193,326
Average rate (Rs.) 1,990.23 1,850.32
(II) CONSUMPTION PER UNIT OF PRODUCTION

Product - Egg Powder (MetricTonnes) 4,572 4,525
Electricity (Rs. Per Metric Tonne) 6,817 6,503
Fuel (Rs. Per Metric Tonne) 6,992 5,702
FOREIGN EXCHANGE EARNINGS AND OUTGO: (Rs. in lacs)

Earnings : 10,346.50 8,622.51
Outgo : 572.93 457.98
15
CONSERVATION OF ENERGY:
Various energy saving measures are under consideration and the same would be implemented in the ensuing
years. During this year under review the company has adopted energy saving techniques for improving power
factors. The outcomes of the initiatives taken by the company is the improvement in power factor. The company
had achieved the maximum powerfactor one in three months during the year under review and earned a powerfactor
incentive of Rs.4,62,528/-.
TECHNOLOGY ABSORPTION:
The company is using the technology acquired from BELOVO, Eielgium. Over the years the company's personnel
have acquired thorough knowledge and make required modification for producing various kind of new products to
meet the market demands.
RESEARCH AND DEVELOPMENT:

Research and Development wing of the company developing new enzyme for manufacturing heat stable yolk
powder which involves process reengineering and refixation of production parameters. In tune with the customers
requirement of egg powders with a changed free fatty acid pattern and with a better lipid profile, the company is
doing trials in its poultry farm to produce different quality of eggs by making changes in feed formulation to meet
the above requirements. The company is also conducting trail in the poultry farm by mixing natural pigments with
feed for the purpose of making improvement in the region of NEPA colour 12 for meeting specific requirements of
some of the customers.

Date . 28-07-2008 EXECUTIVE CHAIRMAN
16
MANAGEMENT DISCUSSION AND ANALYSIS
Cautionary Statement
Certain expectations and projections regarding future performance of the company referenced in the annual
report are forward looking statements. These expectations and projections are based on the existing financial
and economic data along with company's operating plan. Changes at the macro level will have material effect on
the operating plans indicated by such statements.
1. Company Profile:
Your Company is engaged in processing of shell eggs for export markets. The company is in the process of
implementing a poultry farm for captive use of the egg processing plant situated at Cholangapalayam village in
Erode District. As the business of the company is export oriented, movements in local currency against major
currencies have a severe bearing on the performance of the company.
2. Company Profile:
India is one of the leading player in egg production and the cost of producing egg in India is also cheap. India
ranks fifth in the world with annual egg production of 1.61 million tonnes. India is exporting egg powder, forzen
egg yolk and albumen powder to Europe, Japan and other countries. Table eggs are mostly exported to middle
east which have a market around 1,50,000 tonnes per year. The company uses predominantly local inputs and
exporting its final products, changes in economics both locally and at international level affect the growth and
performance of the company. The abnormal increase in the cost of ingredients used in the manufacture of poultry
feeds put a tremendous pressure on the cost of producing eggs which will in turn have a direct bearing on the
profitablity of the company.
3. Industry Performance:
As only few companies in India are engaged in processed eggs business, data relating to performance of this
industry are not available. This year saw buoyancy in demand for egg powders in foreign markets and in view of
this the order book of the company was full throughout the period during the year under review. The company
operated its plant at full capacity and produced 4,572 MTs of egg powder as against the installed capacity of the
plant 4300 MTs. As rupee strengthened against US dollar unexpectedly, the operating margin during this year is
not commensurate with the increased volume of sale of 5,007 MTs. However in the current financial year the
situation of INR v US dollar took a reversed trend and it is expected that the company's operating margin would
be improved to a significant level.
INDUSTRY OUTLOOK:
The year under review faced with the problem of unprecedented increase in egg prices particularly during the first
and third quarter of the year. In this current financial year also the trend of increase in raw material price continued
as there is a spurt in feed ingredients cost. As the increase in feed ingredients cost experienced through out the
world there is a corresponding upward movement in the final product price which neutralized the thread posed due
to raw material price movements. The outlook of this industry appears to be bright by considering the present
trend in movements in the end product price and raw material cost.
STRENGTH OFTHE COMPANY:
The entire production process of the company is well documented which helps the company to track causes for
product complaints up to raw material sources level. Now the company is implementing a state of its kind poultry
farm for captive consumption and after its innplementation the tracker system of the company will be extended up
to the feed ingredients level. The company also made significant investment in process related and residue labs
on international standards and now the company is resourced with facilities to make sample analysis in its lab
and thereby obviating the need to get the sample analysis done in outside laboratories. The company's marketing
subsidiary at Netherlands helps the company in servicing its customers and also provide required vital inputs for
price negotation and finalization of new contracts. The company's supply chain management is so effective
which made the company to register itself as one of the preferred suppliers of renowned customers.
17
FUTURE PROSPECTS:
The company had put a temporary hold on its capacity expansion proposal in view of the drop in its operating
margin. Now the company is not able to meet the demand of some of the prestigious customers and therefore the
company now decided to embark into capacity expansion during this financial year. The steadily increasing oil
price remained the overriding concern of the company. In order to overcome this, the company is taking initiates
to shift to some other cheap fuels. The company has plans to make investments in wind energy to reduce the
increasing trend in cost of production due to fuel price hike.
OPPORTUNITIES:
The company has plans to penetrate into new markets which are now untapped. Vast market for processed egg
products is in existence in England and Russia and the company is taking efforts to enter in to such markets. The
company has already supplied its products to an important customer in England on trail basis and it is in the
process of taking strategic action for tapping other markets.
THREATS:
The company recognize that threats are inevitable in business and believe in identifying and reviving risks on an
on going basis. As the raw material cost is having direct correlation with feed cost, which predominantly uses
agricultural commodities, climatic changes will affect the availability of feed ingredients and their costs. Monsoon
failure may cause shortage of feed ingredients which may result in upward movement of egg price. The investment
in poultry farm results in de-risking this threat to a great extent.
INTERNAL CONTROL SYSTEM ANDTHEIR ADEQUACY:
The Company has formulated and implemented adequate internal control system by duly considering the nature
and size of the business. As changes are taking place continuously both internally and outside which require
modification in internal control system suitable to such a changes, the company during this year carried out a
thorough review of the existing internal control system and its adequacy with a help of an outside consultant.
Based on the feedback received from the consultant the internal control revamping exercise would be undertaken.
The Audit Committee of the Board of Directors reviewing the internal control system at periodic intervals.
INDUSTRIAL RELATION:
The relation between the management and employees are continued to be cordial. The company is in the process
of developing system for identification of contribution made by individual employees for rewarding them
commensurate with their performance. Restructuring salaries and wages are also undertaken for remunerating
employees linked to the performance of the company. The total number of manpower employed by the company
aggregates to 169.

18
REPORT ON CORPORATE GOVERNANCE
1. COMPANIES PHILOSOPHY ON CODE OF CORPORATE GOVERNANCE:
The Company is committed high standard of Corporate Governance in all its activities and
processes. Through its Corporate Governance measures, the company aims to maintain
transparency in its financial reporting and keep all its shareholders informed about its policies,
performance and developments.The key elements of Corporate Governance viz transparency,
internal controls, risk management and communications are being scrupulously followed and
being practiced.
The Company formed various committees to oversee the functions of the Management. The Committees
meet regularly and transact the business assigned to it.
2. BOARD OF DIRECTORS
The details of composition of the Board, attendance of each Director at the Board Meeting held during the
year under review as well as at the last Annual General Meeting and the number of other Directorship /
Committee Membership held by them are as follows.
Promoter/ No. of other Committee

Companies in which
Chairman/ Independent/
S.No. Name of Directors in which he he is a
Director Nominee is a member/
Director Director Chairman
1 Shri. SKM. Maeilanandhan Chairman Promoter 3 Nil

2 Shri. SKM. Shree Shivkumar Director Promoter 2 Nil
3 Dr. M.Chandrasekar Director Promoter 2 Nil
4 Shri.B. Ramakrishnan Director TIDCO-Nominee 9 5
5 Shri. S.M. Venkatachalapathy Director Promoter Nil Nil
6 Dr. L.M. Ramakrishnan Director Independent 3 Nil
7 Shri. M. Chinnayan Director Independent Nil Nil
8 Shri. P. Kumarasamy Director Independent Nil Nil
BOARD MEETINGS AND ANNUAL GENERAL MEETING - DIRECTORS'ATTENDANCE

Board Meeting Last Annual General Meeting
S.No. Name of Directors
Held Attended Attended Not Attended
1 Shri. SKM. Maeilanandhan 5 5 Yes -
2 Shri. SKM. Shree Shivkumar 5 4 Yes -
3 Dr. M.Chandrasekar 5 3 Yes -

4 Shri.B. Ramakrishnan 5 4 - Yes
5 Shri. S.M. Venkatachalapathy 5 5 Yes -
6 Dr. L.M. Ramakrishnan 5 4 Yes -

7 Shri. M. Chinnayan 5 4 Yes -
8 Shri. P. Kumarasamy 5 5 Yes -
19
DIRECTOR RETIRING BY ROTATION BEING RE-APPOINTED:
Dr. L.M. Ramakrishnan, M.B.B.S., aged 66 years is a member of the Board of the Company since 28.02.1997.
Dr. L.M. Ramakrishnan's indepth knowledge & past experience helps the company in solving many issues. He is
the Chairman of Remuneration Committee and a Member in the shareholders and Investor's Grievance Committee.
Shri. M. Chinnayan, B.Com., FCA, aged 68 years is a practising Chartered Accountant. He holds directorships in
this Company since 28.02.1997 and he is co-opting as Chairman of Audit Committee. Shri. M. Chinnayan's tax
knowledge & audit experience helps the company in solving many issues.
AUDIT COMMITTEE:
All the three members of the Audit committee are Non- Executive and Independent Directors. The Chairman of the
Committee is a Chartered Accountant .The Committee met four times on 30.04.2007, 30.07.2007, 27.10.2007
and on 24.01.2008 during this year.The name and the attendance of members are given below:
Audit Committee Meetings

S.No. Name of Members Category
Held Attended
1 Shri. M. Chinnayan Chairman 4 4
2 Shri B. Ramakrishnan Member 4 4
3. Shri. P. Kumarasamy Member 4 4
TERMS OF REFERENCE:
The Audit Committee periodically reviews the adequacy of the internal control system of the company and
reviews the Reports of the Statutory Auditors and discussed their findings. The terms of reference made by the
Board to the Audit Committee are in accordance with the items listed in Clause 49 (II) (D) of the Listing Agreement,
inter alia, including
a. Review of financial statement before submission to the Board of Directors.
b To initiate steps for implementing effective internal control systems to safeguard the assets of the
company.
c. To investigate into any matter, either in relation to the terms specified in Section 292A of the Companies
Act,1956 or referred to it by the Board.
d. Review the Company's financial and risk management policies.
The Company Secretary of the company acts as the Secretary to the Committee. The Statutory Auditors of the
company were invited to attend the meeting.
20
REMUNERATION COMMITTEE:
The Board of Directors constituted this committee on 29.04.2002, which comprises of 3, Non-Executive Directors
and the Composition of the Board is given below.
Name of Members Chairman / Member
Dr. L.M. Ramakrishnan Chairman
Shri. S.M. Venkatachalapathy Member
Shri. P. Kumarasamy Member
During this year under consideration the committee met once on 28-04-08 for determination revision of remuneration
payable to Shri. SKM Maeilanandhan, Executive Chairman and Shri. SKM. Shree Shivkumar, Managing Director.
OBJECTIVES:
The Committee reviews and determine the company's policy on remuneration of Executive Chairman and Managing
Director so as to ensure that they are fairly rewarded for their individual contribution to the company's overall and
their remuneration is in line with industry standards.
BRIEF DESCRIPTION OFTERMS OF REFERENCE:
The broad terms of reference to the Remuneration Committee are to recommend to the Board regarding salary
(including annual increments), perquisites, commission/incentives to be paid to the company's Executive Chairman,
Managing Director/Whole Time Director.
Details of remuneration paid to Executive and Non-Executive Directors for the year 2007-08 are given below
(Amount in Rs.)
Perquisites
Sitting
Name of Directors Salary and Total
Fees
allowances
Shri. SKM. Maeilanandhan 2,858,500 41659 Nil 2,900,159

Shri. SKM. Shree Shivkumar 2,002,000 101624 Nil 2,103,624
Dr. M. Chandrasekar Nil Nil 3,000 3,000
Shri. B. Ramakrishnan (TIDCO) Nil Nil 4,000 4,000
Shri. S.M. Venkatachalapathy Nil Nil 5,000 5,000
Dr. L.M. Ramakrishnan Nil Nil 4,000 4,000
Shri. M. Chinnayan Nil Nil 4,000 4,000
Shri. P. Kumarasamy Nil Nil 5,000 5,000
21
SHAREHOLDERS' AND INVESTORS'GRIEVANCE COMMITTEE :
The Shareholder and Investor Grievances Committee specifically looks into redressing of shareholders' and
investors' complaints such as transfer of shares, non-receipt of share certificates, non-receipt of dividends
and to ensure expeditious share transfer process. The Committee endeavors to settle all shareholders
complaints in the minimum possible time.
The committee consists of the following independent directors
S.No. Name of Members Chairman / Member
1 Shri. P . Kumarasamy Chairman
2 Shri. S.M. Venkatachalapathy Member
3 Dr. L.M. Ramakrishnan Member
GENERAL BODY MEETING:
a. Location and time, where last three Annual General Meetings were held:
Details of Special
AGM Location Date Time Resolution, if any,
passed
Kongu Kalaiarangam No Special
2005-10 t h AGM E.V.K. Sampath Nagar 12.09.2005 4.00 p.m. Resolution was
Erode - 638 011 passed
Kongu Kalaiarangam Special Resolution

2006- 11 th AGM E.V.K. Sampath Nagar 16.09.2006 4.00 p.m. passed to delist
Erode - 638 011 company's equity
shares from
Madras and
Coimbatore Stock
Exchange.
2007- 12 lh AGM Kongu Kalaiarangam No Special

E.V.K. Sampath Nagar 11.09.2007 4.00 p.m. Resolution was
Erode-638 011 Passed
b. Whether special resolutions were put through postal ballot last year? No
i. If Yes, details of voting pattern Not applicable
ii. Persons who conducted the postal ballot exercise Not applicable
iii. Procedure for postal ballot Not applicable
Details of non-compliance by the Company, penalties, strictures imposed
on the Company by Stock Exchange or SEBI or any authority on any matter
related to capital markets, during last 3 years. NIL
22
MEANS OF COMMUNICATIONS :
1. Half yearly report sent to each household of Shareholders No
In which newspaper quarterly results normally published in

c\i
Daily Thanthi(Tamil)
Business Line (English)
3. Any website where displayed Electronic Data Information Filing and

Retrieval (EDIFAR)
4. Whether it also displays official news releases Nil
5. Presentation made to institutional investors or to the analysts Nil
6. Whether Management Discussions and Analysis is part

of annual report or not Yes, it is part of the annual report

23
CERTIFICATE OF THE AUDITORS TO THE SHAREHOLDERS OF

M/S. SKM EGG PRODUCTS EXPORT (INDIA) LIMITED
ON CORPORATE GOVERNANCE
To the members of M/s.SKM Egg Products Export [India] Limited,
We have reviewed the implementation of Corporate Governance by M/s.SKM Egg Products Export
(India) Limited, during the year ended on 31 st March 2008, with the relevant records and documents
maintained by the Company, furnished to us for our review and the report on Corporate Governance as
approved by the Board of Directors.
The compliance of conditions of corporate governance is the responsibility of the management. Our
examination was limited to procedure and implementation thereof, adopted by the Company for ensur-
ing the compliance of the conditions of the corporate governance. It is neither an audit nor an expres-
sion of opinion on the financial statements of the Company.
We have conducted our review on the basis of the relevant records and documents maintained by the
Company and furnished to us for the review and the information and explanations given to us by the
Company.
Based on such a review, in our opinion, the Company has complied with the conditions of Corporate
Governance, as stipulated in clause 49 of the Listing Agreement of the said company with stock
exchanges.
We state that no investors grievances are pending for a period exceeding one month against the
Company as per the records maintained by the shareholders/investors grievance committee.
We further state that such compliance is neither an assurance as to the future viability of the Company
nor the efficiency or effectiveness with which the management has conducted the affairs of the
Company.
for N.C. RAJAGOPAL & CO.,

Chartered Accountants
Place: Erode N.C.SAMPATH

Date : 28.07.2008 PARTNER
Membership No. 009592
24
AUDITOR'S REPORT
TO THE SHAREHOLDERS OF SKM EGG PRODUCTS EXPORT (INDIA) LIMITED
We have audited the attached Balance Sheet of SKM EGG PRODUCTS EXPORT (INDIA)
LIMITED, 185, Chennimalai Road, Erode-638001 as at 31 st March 2008 and also the Profit and Loss
Account for the year ended on that date annexed thereto and cash flow statement for the period
ended on that date. These financial statements are the responsibility of the Company's management.
Our responsibility is to express an opinion on these financial statements based on our audit.
We conducted our audit in accordance with audit standards generally accepted in India. Those
standards require that we plan and perform the audit to obtain reasonable assurance about whether
the financial statements are free of material misstatement. An audit includes examining, on a test
basis, evidence supporting the amounts and disclosures in the financial statements. An audit also
includes assessing the accounting principles used and significant estimates made by the management,
as well as evaluating the overall financial statement presentation. We believe that our audit
provides a reasonable basis for our opinion
1. As required by the Companies (Auditor's Report) Order, 2003 (As Amended) issued by the Central
Government of India in terms of Section 227(4A) of the Companies Act, 1956, we enclose in the
Annexure a Statement on the matters specified in paragraphs 4 & 5 of the said order.
2. Further to our comments in the Annexure referred to in paragraph (1) above:
a. We have obtained all the information and explanations which to the best of our knowledge
and belief where necessary for the purpose of our audit.
b. In our opinion, proper books of accounts as required by law have been kept by the
company, so far as it appears from our examination of the books.
c. The Balance sheet and Profit and Loss Account dealt with by this report are in agreement
with the books of accounts.
d. In our opinion the Profit and Loss account and Balance sheet comply with the accounting
standards referred to in sub section (3C) of Section 211 of the Companies Act, 1956.
e. On the basis of Written confirmation received from the directors as on 31.03.2008 and taken
on record by the Board of Directors, we report that none of the Directors are disqualified
as on 31.03.2008 from being appointed as a director in terms of clause (g) of sub section
(i) of section 274 of the Companies Act 1956.
f. In our opinion and to the best of our information and according to the explanations given to
us, the said profit & loss account and the balance sheet read together with the notes
thereon give the information required by the Companies Act 1956 in the manner as required
and give a true and fair view in conformity with the accounting principles generally accepted
in India :-
25
i. In the case of the Profit and Loss Account, of the Profit for the period ended 31st
March 2008 and
ii. In the case of the Balance Sheet of the state of affairs of the Company as at 31st
March 2008
iii. In the case of cash flow statement, of the cash flows for the year ended on that date.
For N.C. RAJAGOPAL & CO.,

Place: Erode
Date : 28.07.2008
N.C.SAMPATH
PARTNER
26
ANNEXURE
As required by the Companies (Auditors' report) Order, 2003, made by the Central Government under section
227 (4 A) of the Companies Act, 1956, we state that:
1. a. The Company has maintained proper records showing full particulars including quantities details
and situation of fixed assets.
b. The fixed assets have been physically verified by the management at reasonable intervals and no
material discrepancies were noticed on such verifications
c. Fixed assets of a substantial part, affecting the going concern, have not been disposed off during
the year.
2. a. The Management has carried out physical verification of inventory at reasonable intervals.
b. The procedure of verification of inventory followed by the Management is reasonable and adequate
in relation to the size of the Company and the nature of its business.
c. The Company is maintaining proper records of inventory and no material discrepancies were noticed
on physical verification.
3 a. The Company has not granted any secured or unsecured loans to Companies, firms or other partieis
covered in the Register maintained under Section 301 of the Companies act, 1956.
b. The Company has not taken any loans, secured or unsecured, from Companies, firms or other
parties covered in the Register maintained under Section 301 of the Companies act, 1956.
4. There is an adequate internal control system commensurate with the size of the Company and the
nature of its business for the purchase of inventory, fixed assets and for the sale of goods and services
and there is no continuing failure to correct major weaknesses in internal control system.
5. a. The particulars of contracts or arrangements referred to in Section 301 of the Companies Act,
1956, have been entered in the register maintained under that section.
b. Transactions made in pursuance of such contracts or arrangements have been made at prices
which are reasonable, having regard to the prevailing marker prices at the relevant time.
6. The Company has not accepted any deposits from the public.
7. The company has an internal audit system commensurate with its size and nature of its business.
8. We have been informed that the Central Government has not prescribed maintenance of Cost Records
under section 209(1 )(d) of the Companies Act, 1956.
9. a. According to the records of the company, Undisputed Statutory dues including Provident Fund,
Investor Education and Protection Fund, Income Tax, Sales Tax, Wealth Tax, Service Tax, Custom
Duty, Excise Duty, Cess and other material statutory dues, to the extent applicable, have been
generally regularly deposited with the appropriate authorities. According to the information and
explanation given to us, no undisputed amounts payable in respect of the aforesaid dues were
outstanding as at March 31, 2008 for a period of more than six months from the date they became
payable.
b. According to the information and explanation given to us, there are no undisputed amounts payable,
in respect of Income Tax, Wealth Tax, Service Tax, Sales Tax, Customs duty and Cess, were in
arrears as at March 2008, for a period of more than six months from the date they become payable
except the following payments, the details for which are given below :
27
Period to which it Amount Due Forum where the appeal is

Particulars relates to be paid preferred
Excise Duty March 2006 to Rs.73,874/- Commissioner of Appeal, Salem.

•p
December 2007
Service Tax January 2005 to Rs. 3,45,865 CESTAT, Chennai against the order
June 2005 of the Commissioner of Central
Excise, Salem
Service Tax April 2006 to Rs. 1,97,293/- High Court of Madras

September 2006
Service Tax October 2006 to Rs.3,63,898/- High Court of Madras
December 2006
Service Tax January 2007 to Rs.4,36,775/- High Court of Madras
March 2007
Service Tax April 2007 to Rs.4,89,366/- High Court of Madras

September 2007
Service Tax July 2005 to Rs.3,10,489/- High Court of Madras

December 2005
Service Tax January 2005 to Rs.13,686/- Commissioner of Central Central

June 2005 Excise - Appeal, Salem.
Service Tax July 2005 to Rs. 1,01,786/- High Court of Madras
December 2005
Service Tax January 2006 to Rs.4,82,328/- High Court of Madras
March 2006
Excise Duty June 2005 to Rs.29,230/- Commissioner of Central Excise
May 2005 Appeals, Salem.
10. The Company has not defaulted in repayment of dues to Hnancial Institution or banks.
11. The Company has not granted loans and advances on the basis of security by way of pledge of shares,
debentures and other securities and hence maintenance of adequate documents and records for such
cases does not arise.
12. The Company does not have any Accumulated losses. The Company has not incurred cash losses
during the year covered by our audit and the immediately preceding financial year.
13. The Company has not given any guarantee for loans taken by others from banks or financial institutions.
14. The company is not a chit fund, Nidhi or Mutual benefit Society. Hence the requirements of item (xiii) of
paragraph 4 of the Order is not applicable to the company.
28
15. In our opinion, the company is not dealing in or trading in shares, Securities, Debentures and other
Investments. Accordingly the provisions of clause 4[xiv] of the companies [Auditor's Report] Order
2003 are not applicable to the company.
16. As per the information and explanations given to us, Term Loans borrowed by the company were applied
for the purposes for which the loans were obtained.
17. As per the information and explanations given to us, funds raised on short Term basis have not been
used for Long Term Investments.
18. On the basis of the information and explanations furnished by the company no fraud on or by the
Company has been noticed or reported during the year.
19. According to the information and explanations given to us no preferential allotment of shares has been
made by the company to companies, firms, or parties listed in the register maintained under section 301
of the Companies Act 1956.
20. The company has not issued any debentures. Hence the requirement of clause (xix) of paragraph 4 of
the Order is not applicable to the company.
21. During the period covered by our audit report, the company has not raised any money by public issue.

Place: Erode N.C.SAMPATH

PARTNER
Date : 28.07.2008 Membership No. 009592
29
BALANCE SHEET AS AT 31st MARCH, 2008

(Amount in Rs.)
As at As at
Particulars Schedule 31.03.2007
31.03.2008
SOURCE OF FUNDS
Share Capital A 263,300,000 263,300,000
Reserves & Surplus B 259,566,909 245,083,243
Deferred Tax Liability 51,931,877
Secured Loans C 298,600,876 163,976,720
873,399,662 672,359,963
APPLICATION OF FUNDS
Fixed Assets
Gross Block D 774,752,069 575,305,242
Less: Accumulated Depreciation 215,078,291 184,487,326
Net Block 559,673,778 390,817,916
Investment E 20,832,779 28,136,362
Current Assets, Loans
and Advances
Inventories F 116,562,887 173,102,046
Sundry Debtors G 42,441,056 10,094,061
Cash & Bank Balances H 30,693,273 30,330,578
Loans & Advances I 156,378,797 82,054,019
346,076,013 295,580,704
Less : Current Liabilities and
Provisions
Current Liabilities J 18,074,910 21,332,955
Provisions K 35,107,998 20,842,064
53,182,908 42,175,019
Net Current Assets 292,893,105 253,405,685
873,399,662 672,359,963
Notes on Accounts S
1. Significant accounting policies 18 a to 18 t.
2. Notes to the accounts form part of this Balance Sheet.
For and on behalf of the Board
3. This is the Balance Sheet referred to in our report of even date.
For N.C.RAJAGOPAL & CO., SKM. MAEILANANDHAN SKM. SHREE SHIVKUMAR

Chartered Accountants Executive Chairman Managing Director
N.C.SAMPATH V. JAGADEESAN
Partner General Manager - Finance &
Membership No. 009592 Company Secretary
Place : Erode
Date : 28.07.2008
30
PROFIT AND LOSS ACCOUNT FOR THE YEAR ENDED 31 St MARCH, 2008
(Amount in Rs.)
Year Ended Year Ended
Particulars Schedule
31.03.2008 31.03.2007
INCOME
Sales L 1,066,948,379 883,838,747
Other Income L 83,664,432 18,017,453
Increase / (Decrease) in Stock M (79,771,000) 22,806,690
Total 1,070,841,811 924,662,890
EXPENDITURE
Purchase and Manufacturing Expenses N 769,903,960 645,140,953
Employees' Cost O 38,388,576 30,147,867
Administration and Other Expenses P 81,720,091 76,191,354
Marketing Expenses Q 28,775,327 13,127,768
Sub Total 918,787,954 764,607,942
Profit /(Loss) Before Interest and Depreciation 152,053,857 160,054,948
Interest and Financial Charges R 28,899,720 22,394,882
Profit/(Loss) After Interest 123,154,137 137,660,066
Depreciation D 30,758,012 27,898,374
Profit /(Loss) after Interest & Depreciation (BeforeTax] 92,396,125 109,761,692
Provision for Income Tax 9,399,335 410,000
Provision for FBT 284,023 1,100,000
Provision for Deferred Tax (1,464,283)
Profit / (Loss) After Income Tax and available for
appropriations 84,177,050 108,251,692
Less: Appropriations
a) Provision for proposed dividend 13,165,000 13,165,000
b) Provision for Corporate Dividend Tax 2,237,392 2,215,670
15,402,392 15,380,670
Balance carried to Balance Sheet 68,774,658 92,871,022
Earnings Per Share (Basic) 3.20 4.11
Earnings Per Share (Diluted) 3.20 4.11
Notes on Accounts S
1. Significant accounting policies 18 a to 18 t.
2. Notes to the accounts form part of this Profit & Loss Account.
3. This is the Profit & Loss Account referred to in our report of even date.
N.C.SAMPATH
Partner V. JAGADEESAN
Membership No. 009592 General Manager - Finance &
Company Secretary
Place : Erode
Date : 28.07.2008
31
SCHEDULES FORMING PART OF THE BALANCE SHEET

AND PROFIT & LOSS ACCOUNT
(Amount in Rs.)
Particulars As at 31.03.2008 As at 31.03.2007
SCHEDULE - A - Share Capital

Authorised Capital:
3,00,00,000 Equity Shares of Rs.10/- each 300,000,000 300,000,000
Issued. Subscribed & Paid-up Capital:
2,63,30,000 Equity Shares of Rs.10/-each fully paid-up 263,300,000 263,300,000
263,300,000 263,300,000
SCHEDULE - B - Reserves & Surplus

Share Premium Account 400,692 400,692
General Reserve
- Revenue Reserve 115,124 115,124
Profit & Loss Account
- Opening Balance 244,567,427 151,696,405
- Less : Provision for Gratuity for earlier years (894,832)
Less : Deferred Tax Liability for earlier years (53,396,160)
Add : Current Year Balance after appropriation 68,774,658 92,871,022
- Closing Balance 259,051,093 244,567,427
259,566,909 245,083,243
SCHEDULE-C- SECURED LOANS *
i) From State Bank of India, Commercial Branch, Erode.

Working Capital Finance and 122,193,293 119,965,712
Corporate Foreign Currency Term Loan 175,703,005 43,989,867
ii) Kotak Mahendra (Vehicle Loan) 704,578 21,141
298,600,876 163,976,720
* WORKING CAPITAL FINANCE AND CORPORATE LOAN ARE SECURED BY :
1. Hypothecation of stocks consisting of raw materials, semi-finished goods, finished goods and stores, spares
and other current assets of the Company.
2. First charge on the entire fixed assets of the Company.
3. Personal guarantees of Executive Chairman, Managing Director and Dr. M. Chandrasekar, Director and
Corporate guarantee of M/s. SKM Animal Feeds and Foods (India) Limited.
32
Schedule
SCHEDULE - D-- FIXED ASSETS (Amount in Rs.)
Gross Block Depreciation Net Block

Adjustments Adjustments Total
As at Additions As at up to Depreciation As at As at
DESCRIPTION deductions deductions Depreciation
31.03.2007 during the 31.03.200f 31.03.2007 During the during the 31.03.2008 31.03.2007
during the up to
year year
year vear- 31.03.2008
Land 19,011,024 26,927,532 — • 45,938,556 — : 45,938,556 19,011,024

Building 102,706,392 83,809,318 •186,515,710 22,600,202 3,919,978 ... - 26,520,180 159,995,530 80,106,T90
;
Plant & Machinery 390,027,633 36,477,521 • 426,505,154 148,288,781 22,712,922 -- 171,001,683 255,503,471 24V,738,872
Office & Other Equipments 32,960,505 ,K 3,618,029 - - 36,578,534 6,678,772 2,153,654 -- 8,832,426 27,746,108 26,281,733
Computers' 4,679,786 5,555,128 10,234,914 3,221,274 853,373 -- 4,074,647 6,160,267 1,458,512
Furniture & Fixtures 5,110,955 292,018 - - 5,402,973 2,135,783 337,500 - 2,473,283 2,929,690 2,975,172
Motor Vehicles 5,888,623 2,640,116 179,000 8,349,739 1,562,534 780,585 167,047 2,176,072 6,173,667 4,326,089
Work in progress 14,920,324 51,888,923 14,920,324 51,888,923 -- -- -- - 51,888,923 14,920,324
GROSSTOTAL 575,305,242 211,208,585 15,099,324 771,414,503 184,487,326 30,758,012 167,047 215,078,291 556,336,212 390,817,916
PREVIOUS YEAR 538,419,184 36,887,391 1,333 575,305,242 156,588,952 27,898,374 - 184,487,326 390,817,916 381,830,232
Cost of Bird
Un - amortised
Adjustments / Bird's Cost value of
As on 31.03.2008
DESCRIPTION Purchase during deductions written off Birds
As at 31.03.2007
the year during the
year
Chick Cost - 4,013,848 - 4,013,848 676,282 3,337,566

Schedule (Amount in Rs.)
SCHEDULE - E - Investments
Investments in Mutual Funds
Current Investments (Valued at lower of cost of fair value)
Quoted:
Templeton Indian Equity Income Fund — 152,137

SBI MF MSFU Contra Fund 1,71,101
Sundaram BNP Paribas Select Midcap Fund ... 1,216,832
Birla Midcap Fund — 1,623,918
Franklin India Prima Plus Fund ... 1,500,504
Sundaram BNP Paribas Rural Fund (Dividend Option) ... 826,287
Sundaram BNP Paribas Rural Fund (Growth Option) — 168,839
Lona Term Investments (Valued at cost)

Birla Infrastructure Fund (Dividend Option) — 79,285
Birla Infrastructure Fund (Growth Option) ... 79,285
UTI MasterValue Fund — 835,303
Sundaram BNP Paribas Select Midcap Fund ... 83,826
Sundaram BNP Paribas Rural Fund (DividendOption) — 218,185
Unquoted
SKM Europe BV., The Netherlands - Subsidiary Company 832,779 832,779
Saravana Finance Private Limited 20,000,000 20,348,081
20,832,779 28,136,362
CURRENT ASSETS, LOANS AND ADVANCES
Schedule F - Inventories
(As Valued and Certified by the Management)
Raw Material 5,577,952' 9,742,995
Additives, stores, spares and consumables 25,672,472 21,711,051
Finished Goods 82,038,000 141,648,000
Feed & Medicines 3,274,463 —
116,562,887 173,102,046
^\ * * L^ * ^ «J I I I ^^ ^ ^ ^ ^ • • v« *J m*m m 1 ^ *^ L« & ^^ M *«
bcnedule la - bundry Debtors

Unsecured and Considered Good
Sundry Debtors - Considered Good
a) Morethan 6 months
b) Others: 42,441,056 10,094,061
42,441,056 10,094,061
34
Schedule
(Amount in Rs.)
As at As at
Particulars 31.03.2008 31.03.2007
Schedule H - Cash and Bank Balances

i. Cash on hand 503,483 432,530
ii. In Current Accounts with Scheduled Banks 21,967,206 22,795,780
iii. Fixed deposit with SBI, Commercial Branch, Erode 8,222,584 7,102,268
30,693,273 30,330,578
Schedule 1 - Current Assets (Loans and Advances)
i. Advances recoverable in Cash or in kind
for value to be received - unsecured and
considered good 130,549,408 71,043,595
ii. Deposits - considered good 8,040,000 9,591,495
iii. Advance Income Tax and VAT credit 8,886,688 1,418,929
iv. Pre-Operative Expenses - Farm Division 8,902,701
156,378,797 82,054,019
Schedule J - Current Liabilities and Provisions
i. Trade Creditors (Refer note 3 in Schedule S) 15,617,498 19,306,579
ii. Creditors for Expenses & Others 419,456 342,944
iii. Unpaid Dividends 2,037,956 1,683,432
18,074,910 21,332,955
Schedule K - Provisions
i. Provision for Income Tax - MAT 10,212,335 410,000
ii. Provision for Proposed Dividend 13,165,000 13,165,000
iii. Provision for Corporate Dividend Tax 2,237,392 2,215,670
iv. Provision for Earned Leave 1,090,410 527,601
v. Provision for Sales Commission 2,054,139 1,140,000
vi. Provision for Genset Tax 1,530,000 930,000
vii. Provision of Expenses — 1,353,793
viii.Provision for FBT 1,384,023 1,100,000
ix. Provision for VAT Payable 25,243 ...
x. Provision for Bonus 1,162,000 —
xi. Provision for L.T.A., 785,977 ...
xii. Provision for Egg Yolk Powder 481,106 ...
xiii.Provision for Gratuity 933,398 ...
xiv. Provision for loss on Forward Contracts 46,975 ...
35,107,998 20,842,064
35
Year ended Year ended

Particulars 31.03.2008 31.03.2007
Schedule - L Sales and Other Income
Sales: •
Export sales 1,034,650,182 862,251,870 .

Domestic sales 32£98,197 21,586,877
1,066,948,379 883,838,747
Other Income:
Sale of shell eggs & Scrap 927,000 655,005
Interest receipts 3,994,772 , 2,354,802
Dividend receipts - Mutual Funds 99,140 2,815,633
Interest subsidy •— 10,663,099
; Vishesh Krishi Upaj Yojana - Subsidy . " •. 49,542,000
Egg Drawback 19,941,000
•• Exchange fluctuation net 8,017,409 1,528,914
Profit on sale of Investments 1,111,064
Profit on sale of Assets ' .32,047 —
83,664,432 18,017,453
SCHEDULE - M- INCREASE/(DECREASE) IN STOCK
Opening Stock - Egg Powder 141,648,000 115,691,310
Add : Egg Powder Purchase 20,161,000 3,150,000
Closing Stock - Egg Powder 82,038,000 141,648,000
Increase / (Decrease) in Stock (79,771,000) 22,806,690
. SCHEDULE-N- PURCHASE AND MANUFACTURING EXPENSES

Raw material - Eggs Consumed 622,197,899 506,979,919
1
Egg Purchase 7,022,081 . 22,736,713
Egg Powder Processing Charges 197,281 1,696,560
Chick Cost Written off 676,282 — •
Feed & Maize Consumption • , . 11,592,582 . —
Vaccine & Medicine Consumption 1,129,691 <
Packing Material - Consumption 24,925,892 ^ 18,357,081

Power and Fuel 63,556,172 ' 55,380,485
• Transport Hire and Cooli 1,012,225. .962,640
Additives and Consumables 37,593,855 .. 39,027,555
769,903,960 645,140,953
36
Yearended Year ended

Particulars 31.03.2008 31.03.2007
SCHEDULE - O - EMPLOYEES' COST
Salaries and Wages 19,799,390 14,863,269
PF Contribution 1,205,204 981,434
Contractors' Payment 15,001,940 12,043,712
Grauity Expenses 381,562
Welfare Expenses 2,000,480 2,259,452
38,388,576 30,147,867
SCHEDULE - P - ADMINISTRATION AND OTHER EXPENSES
Repairs and Maintenance
a. Building 1,894,638 1,030,775
b. Plant and Machinery 3,674,428 1,672,203
c. Others 3,016,706 1,823,844
d.Vehicle (Car, Van and Two Wheelers) 3,281,761 2,950,333
11,867,533 7,477,155
Stores and Spares - consumed 14,218,625 13,788,416
Analysing Charges 5,170,022 8,391,844
Rent, Rates and Taxes 1,787,446 843,888
Postage, Courier and Telephone Charges 1,760,574 2,304,110
Printing and Stationery 878,198 925,912
Insurance Premium 1,221,345 1,029,187
Advertisement and Publicity 1,460,682 546,398
Travelling Expenses 3,656,347 2,939,074
Freight, Insurance and Forwarding Charges ' 32,864,896 25,597,105
Professional Charges 2,489,272 1,765,357
ISO/HACCP-Expenses 446,872 464,006
Stock Exchange Listing Fee 176,474 171,594
Miscellaneous Expenses 776,901 434,435
Audit fees: Statutory • 352,540 211,230
Donation 2,592,364 2,155,000
Loss on sale of (import Licence 3,496,059
Loss on sale of Investments (Mutual Funds) • 2,318,126
Diminishing ir> value of investments — 1,332,458
;
•
69,852,558 68,714,199
81,720,091 76,191,354
37

Particulars 31.03.2008 31.03.2007
SCHEDULE - Q - MARKETING EXPENSES
Foreign Trip Expenses 2,728,460 1,209,166
Sales Commission to Foreign Collaborators and Others 22,982,849 9,293,321
Foreign Exhibition Expenses 1,616,230 782,252
Sales Promotional Expenses 455,357 543,357
Sample Courier Charges 836,976 470,796
Foreign Delegates Expenses 155,455 828,876
28,775,327 13,127,768
SCHEDULE - R - INTEREST AND FINANCIAL CHARGES
Working Capital Loan Interest 8,754,230 8,079,070
Bank Charges & ECGC Charges 1,820,442 1,499,234
Export bills discount interest 3,608,974 5,648,499
Export bills-overdue interest 1,350,246 846,121
Interest paid - others (Vehicles loan etc.) 110,316 40,189
Interest Paid - SBI FD Loan 482,243 90,185
Bill Discount and Collection Charges 2,038,977 1,452,635
SBI -Term Loan Interest 3,326,962 4,738,949
Interest paid preshipment 3,823,917
Interest paid HDFC Loan 1,584,022
Interest Paid Rupee Loan 136,877
Interest Paid Centurian Bank 1,862,514
28,899,720 22,394,882
Schedule S
NOTES ON ACCOUNTS
1. Previous year figures are regrouped, rearranged and reclassified wherever necessary to facilitate
comparison with current year's figures and figures have been rounded off to nearest rupee.
2. Contingent Liability:
Export Bills discounted with the State Bank of India, Commercial Branch, Erode Rs. 1,866.48 Lacs.
(Previous year Rs. 2,032.25 Lacs)
3. Balances of Sundry creditors and Sundry debtors are subject to confirmation.
The Company has not received any intimation from the suppliers regarding status under the Micro,
Small and Medium enterprises development Act, 2006 (The Act) and hence disclosure regarding :
a. Amount due and Outstanding to suppliers as at the end of the accounting year.
b. Interest paid during the year.
38
c. Interest payable at the end of the accounting year.

d. Interest accrued and unpaid at the end of the accounting year, have not been provided.
The Company is making efforts to get the confirmations from the suppliers as regards their status
under the Act.
4. Sales Commission and others under "Marketing Expenses" includes compensation claim of
Rs.86.60 lacs.
5. Additional Information pursuant to the provisions of paragraph (4D) of part - II of schedule VI to
Companies Act, 1956 :
I. Details of Licensed Capacity, installed capacity.
a. Licensed Capacity not applicable.
b. Installed Capacity 4,300 Metric Tonnes per annum.
11. Quantitative particulars of sales : (in Metric Tonnes)
2007-2008 2006-2007
Egg powder sales 5,007 4,580

Stock and Production (in Metric Tonnes)
a. Opening stock 815 871
b. Production & Purchase 4,651 4,525
c. Closing stock 459 816
IV. Consumption of Raw materials,

a.. Egg (Nos. in lakhs) 3,862.04 3,712.31
V. Consumption of imported and indigenous materials :
2007-2008 2006-2007
Particulars Rs. in lacs % Rs. in lacs %
Raw Material
Indigenous 6,237.32 100.00 5,069.80 100.00
Imported Nil Nil Nil Nil
Packinq Material
Indigenous 249.02 99.90 178.55 97.27
Imported 0.24 0.10 5.02 2.73
Consumable. Stores and Spares
Indigenous 304.87 58.78 322.48 61.06
Imported 213.25 41.22 205.68 38.94
Fuel
Indigenous 377.98 100.00 284.42 100.00
Imported Nil Nil Nil Nil
39
VI. Expenditure in Foreign Currency : (Rs in Lacs)
Particulars 2007-2008 2006-2007

A. Packing Material & Additives 169.98 195.44
B. Stores and Spares 37.47 ; 46.6Z
C. Foreign Travel Expenses 7.60 10.11
D. Analysing Charges 34.50 64.52
E. Sales Commission 143.27. • 72.46
F. Others 180.11 • 68.83

Total 572.93 457.98
VII. FOB Value of goods exported 10,124.41 8,451.63

6. Remuneration to Executive Chairman and
Managing Director: (in Rs.)
2007-2008 2006-2007
Executive Chairman 29,00,159 17,64,000
Managing Director 21,03,624 22,14,920
(i) The Executive Chairman and Managing Director's remuneration is covered under part II of Schedule
XIII of the Companies Act,-1956. . / , ./
7. Details of Fees to Auditors: (in Rs.) 2007-2008 2006-2007

(Including Service Tax wherever applicable)
(i) For Statutory Audit Fee 56,190 56,180
:
(ii) For Taxation Matter • ' • 165,450 ' . 1,12,360. -
(iii) For Certification Services 30,900 .27,190
(iv) Others 1,00,000 .Nil.
(v) Sales Tax Matters Nil 15,500'
8. Related Party Disclosures:, , .... .. .
i. Sale of Egg Shellgrits to SKM Animal Feeds and Foods<(lndia) Limited - Rs.6.45/- lacs. (Tonnage
1,146 Tons)
ii. Investmentof SKM Animal Feeds and Foods (India) Limited in the company is Rs.1,062.00 lacs
and Investment of SKM Siddha and Ayurvedic Medicines (India) Private Limited in the Company
is Rs.20.61 lacs as bn 31.03.2008 in the equity share capital of the-.Company. .
iii. Sale of Cartons to SKM Siddha & Ayurvedic Medicines India Pvt. Limited - Rs.4,072/-
iv. Purchase of Feeds and Maize from SKM Animal Feeds and Foods (India) Limited during the
year amounting to Rs. 1.42 crores (Tonnage 1,264.70 Tons)
Nature of Relationship - The above companies are related by virtue of common Chairmanship and
Directorship of 1) Shri. SKM.Maeilanandhan (Chairman) 2) Shri SKM. Shree Shivkumar (Director) and
3) Dr. M.Chandrasekar (Director)
9. Loans and Advances includes advance of Rs.1.69/- Crores (Last Year- Rs.1.13 Crores) to subsidiary
company of SKM Europe BV, the Netherlands.
40
10. Provision for Income Tax, Fringe Benefit Tax and Deferred Tax Liability :
Income Tax:
Provision has been made in respect of Income Tax Liability under the Provisions of Section
115 JB (Minimum Alternate Tax) of the Income Tax Act, 1961, since there is no Tax liability
under the normal provisions of the Income Tax Act, 1961, in view of the fact that the company
has carried forward losses to be set off against the profit of the current year.
Fringe Benefit Tax:
Also Provision has been made in respect of Fringe Benefit Tax Liability to the extent of
Rs.2.84/- lacs
Deferred Tax Liability / Asset:
Deferred Tax Liability Adjusted against Opening Reserves and Surplus :

Depreciation (DTL) - Rs. 8,67,36,489/-
Carried Forward Depreciation Losses (DTA) - Rs.3,30,36,175/-
Gratuity relating to Earlier years (DTA) - Rs. 3,04,154/-
Net DTL Adjusted against the Reserves - Rs. 5,33,96,160/-
Deferred Tax Asset recognised in the Profit and Loss Account:
Depreciation - Rs. 13,60,455/-

Gratuity - Rs. 1,03,828/-
Total - Rs. 14,64,283/-
11. No provision has been made in respect of demand of Excise Duties of Rs. 1.03 lacs and Service
Tax of Rs.27.41 lacs, for which the company has filed appeals with various Higher Appellate
Forums, against the orders of the Lower Authorities.
12. Segment Reporting:
Since the company is concentrating on only one product and the area of operation is only in
India, the disclosure requirement as required by the Accounting Standard 17 issued by the
Institute of Chartered Accountants of India, dealing with segment Reporting, does not arise.
13. There are no impairment of assets in terms of Accounting Standard No.28 issued by the Institute
of Chartered Accountants of India.
14. The Company during the year has made a provision for an amount of Rs.4.95 Crores being duty
scrip value under 'The Vishesh Krishi and Gram Udyog Yogana Scheme", for which the company
has made due claims with the respective authorities. The value of duty scrip has been treated
as a current asset in the statement and any loss if be any on realization on the sale of the scrip
will be recognized in the period of realization. Similarly provision for duty draw back on Eggs
(Raw Material) has been made to the extent of Rs.1.99 Crores.
15. Financial and Derivative Instruments :
a. Nominal amount of Derivative contracts entered into by the Company for hedging currency
and outstanding as on 31st March, 2008 amounts to Rs.66,58,77,232/- (Previous Year -
Not Available.
Particulars As at 31 st March 2008 As at 31 st March 2007
1. Forward Contracts 66,58,77,232 NA
b. Financial and Derivative contracts entered into by the company are for both hedging and
trading purposes.
41
c. Foreign Currency exposure that are not hedged by derivative or forward contracts as on
31st March 2008 amounts to Rs. 1,80,16,477/- (Previous Year Rs. Nil)
d. Nominal amount of Derivative contracts entered into by the company for Trading or
Speculation and outstanding as on 31 st March 2008 amounts to Rs.5.33 Crores (Previous
Year Rs. Nil) and the loss recognized in the financial statement is Rs. 46,975/- (Previous
year Rs. Nil)
16. During the year the company has recognized the following amounts in the Profit and Loss
Account:
Gratuity (Funded)
a. Reconciliation of Opening and Closing
Balances of Defined Benefit Obligations
Present Value of obligation as at 1 st April 2007 18,77,260/-
Current Service Cost 4,35,937/-
Interest Cost 1,50,181/-
Actuarial (gain) / loss -91,919/-
Benefits paid 76,067/-
Present Value of obligation as at
31st March 2008 22,95,392/-
b. Reconciliation of Opening and Closing

Balances of Fair Value of Plan Assets :
Fair Value of plan assets as at 1 st April 2007 9,82,428/-
Expected return on plan assets 1,12,637/-
1
Contribution made 3,42,996/-
Benefits Paid 76,067/-
Actuarial gain / (loss) on the plan assets Nil
Fair Value of plan assets as at 31st March 2008 13,61,994/-
c. Reconciliation of Fair Value of Assets and
Obligations as at 31st March 2008 :
Present value of the obligation 22,95,392/-
Fair Value of plan assets 13,61,994/-
Funded Status (Surplus / (Deficit)) -933,398/-
Net asset / (liability) recognized in the
balance sheet -933,398/-
d. Expenses recognized during the year
(Under the head "Employees Cost - Refer
Schedule "O")
Current Service Cost 4,35,937/-

Interest Cost 1,50,181/-
Actuarial (gain) / loss -91919/-
Net Cost 3,81,562/-
42
e. Actual return on the plan assets :

Actuarial gain / loss on plan assets Nil
Actual return on plan assets 1,12,637/-
f. Actuarial Assumptions:
Discount rate (per annum) 8.0%
Rate of escalation in salary (per annum) 6.5%
The Company made annual Contributions to the LIC of an amount advised by the LIC. The
Company was not informed by LIC of the investments made by the LIC or the Break-down of
plan assets by investment type.
17. Poultry Division :
The company during the year has started business operations in Poultry Division from the
month of October and introduced four batches of Chicks. The Eggs laid by the birds were*
transferred to the Egg Product division for its Captive Consumption, at the prevailing NECC
Rate. Separate books of accounts are being maintained by the Company for the Poultry Division.
All expenses such as consumption of Feeds, Drugs and Vaccines, Wages etc., are treated as
revenue expenditure as and when they are incurred except for the cost of birds which are written
off over the period of life of birds.
18. Significant Accounting Policies:
(a). Accounting Convention:
The Financial statements have been prepared under historical cost convention. The Financial
Statements materially comply with the Accounting Standards issued by the Institute of Chartered
Accountants of India.
(b). Estimates and Assumptions:
Preparation of financial statements requires management to make estimates and assumptions
that affect the reported amount of assets and liabilities at the date of the Balance sheet and the
reported amounts of income and expenses during the reporting period. Examples include bad
debts written off, useful life of the assets, etc. Actual results may differ from these estimates.
(c). Inventories:
Inventories are valued as under:
Egg Products Division :
1. Raw materials : At cost following FIFO method.
2. Packing Materials : At weighted average cost.
3. Additives : At weighted average cost.
4. Stores & Spares
Imported : At weighted average cost.
Indigenous : At weighted average cost.
5. Semi-finished goods : At weighted average cost.
6. Finished goods : At weighted average cost.
Poultry Farm Division :
1. Eggs : At cost following FIFO method.
2. Feeds : At cost or market price whichever is lower
3. Drugs : At cost or market price whichever is lower
43
(d). Cash Flow Statements
Cash Flow Statement has been prepared under "Indirect Method", Cash and Cash Equivalents
comprise Cash in Hand, Current and Other accounts held with bank.
(e). Events Occurring after the Balance Sheet Date

i. Assets and Liabilities are adjusted for events occurring after the balance sheet date that
provide additional evidence to assist the estimation of amounts relating to conditions
existing at the balance sheet date.
ii. Dividends, which are proposed / declared by the company after the balance sheet date
but before the approval of the financial statements are adjusted.
(f). Net Profit or Loss for the Period, Prior Period Items and Changes in Accounting Policies:
i: Net Profit for the Period:
All the items of income and expenses in the period are included in the determination of
net profit for the period, unless specifically mentioned elsewhere in the financial statements
or is required by the an Accounting Standard.
ii. Prior Period Items:
Income / Expenditure are disclosed in Prior period adjustments, only when considered
by the management to be material to impact the financial statement significantly.
iii. Extra - ordinary items:
Extra - ordinary items are accounted in accordance with the Accounting Standard - 5
(g). Depreciation Accounting
Depreciation is provided on straight line method as per the rates provided in schedule XIV of
the Companies Act 1956, except for imported plant & machinery for which the rate has been
taken as 3.80%, based upon the technical evaluation by the expert committee on the useful life
of the assets. In respect of assets added/adjusted during the year, depreciation is provided on
pro-rata basis.
(h). Revenue Recognition:
Egg Products Division :

Sales are recognised on accrual basis and are accounted for in the books of accounts on the
dates on which the goods are actually despatched from the factory.
Poultry Division:
Sales of Eggs and Birds are recognised on accrual basis and are accounted for in the books of
accounts on the dates on which the goods / Birds are actually despatched from the farms or
sold rexpectively.
(i). Accounting for Fixed Assets:
Fixed Assets:
Fixed Assets are stated at cost of acquisition inclusive of inward freight, duties and taxes and
incidental expenses related to acquisition. In respect of major projects involving construction,
related preoperational expenses form part of the value of assets capitalised. Expenses
capitalised also include applicable borrowing costs.
44
Capital Work-in-progress:
Advances paid towards the acquisition of fixed assets and the cost of assets under installation
/ construction / not put to use before the year end are disclosed under capital work-in-progress.
(j). Foreign Currency Transactions and Forward Contracts in Foreign Currencies:

Foreign Currency Transactions:
Transaction in Foreign Exchange are accounted at the monthly average rates.
Foreign currency Liabilities / Assets at the close of the year are restated, adopting the contracted/
year and rates, as applicable.The resultant difference, if any, is suitably dealt with in the accounts.
Forward Exchange Contracts covered under AS 11, "The Effects of Changes in Foreign
Exchange Rates":
The Company uses foreign exchange contracts to hedge its exposure to movements in foreign
exchange rates. The use of these foreign exchange contracts reduces the risk or cost to the
company. Wherever the company uses the forwards to mitigate the business loss on account of
foreign currency fluctuations, the company records the gain or loss on effective hedges in
foreign currency fluctuation reserve until the transactions are complete. On completion, the
gain or loss is transferred to the profit and loss account of that period. To designate a forward
contract as an effective hedge the management objectively evaluate and evidences with
appropriate supporting documents at the inception of each contract whether the contract is
effective in achieving offsetting cash flows attributable to the hedged risk. In the absence of a
designation as effective hedge, the gain or loss is recognized in the profit and loss account.
Forward Exchange Contracts not in the nature of AS 11, "The Effects of Changes in Foreign
Exchange Rates":
The company also uses foreign exchange forward contract for trading or speculation purpose.
Though the Accounting standard No.30 issued by the institute of Chartered Accountants of
India dealing with "Financial Instruments and Derivatives - Recognition and Measurement"
becomes mandatory only with effect from 1.4.2011 and is recommendatory for the current financial
year, the company has adopted the accounting standard and has recognized the losses in the
financial statements.
(k). Accounting for Government Grants:

Grants and Subsidies in the nature of revenue are treated as revenue income and credited to the
respective expenses accounts and subsidies in the nature of capital are adjusted to the value of
assets.
(I). Accounting for Investments:
i. Long Term investments are valued at cost. Provisions, if any, is made to recognize a decline
other than a temporary decline, in the value of long-term investments.
ii. Current Investments are stated at lower of cost and fair market value.
(m). Accounting for Retirement Benefits:
a. Defined Contribution Plans :
The company makes Provident Fund to defined contribution retirement benefit plans for qualifying
employees. Under the Schemes, the company is required to contribute a specific percentage of
the payroll costs to fund the benefits.
The company recognized Rs. 12.05/- Lacs (Previous Year Rs. 9.81 lacs) for provident fund
Contribution in the Profit and Loss Account. The Contributions payable to these plans by the
company are at rates specified in the rules of the Schemes.
45
b. Defined Benefit Plans :

The present value of the obligation is determined based on actuarial valuation using the Projected
Unit credit method, which recognizes each period of service as giving rise to additional unit of
employee benefit entitlement and measures each unit separately to build up the final obligation.
The estimates of rate of escalation in salary considered in actuarial valuation, taking into account
inflation, seniority, promotion and other relevant factors including supply and demand in the
employment market. This being the first year of implementation, previous year figures have not
been given.
Accounting for Employment Benefits :

i. Short term employee benefit are charged off at the undiscounted amount in the year in
which the related service is rendered.
ii. Post employment and other long term employee benefits are charges off in the year in which
the employee has rendered services. The amount charges off is recognized at the present
value of the amounts payable determined using actuarial valuation techniques. Actuarial
gain and losses in respect of post employment and other long term benefits are charged to
Profit and Loss Account.
(n). Borrowing Cost:
Borrowing costs attributable to acquisition and construction of assets are capitalised as part of
the cost of such asset up to the date when such asset is ready for its intended use. Other
Borrowing Costs are treated as revenue expenditure.
(o). Segment Reporting:
Since the company is concentrating on only one product and the area of operation is only in
India, the disclosure requirement as required by the Accounting Standard 17 issued by the
Institute of Chartered Accountants of India, dealing with Segment Reporting, does not arise.
(p). Earning per Share:
i. Basic earning per share has been computed with reference to Weighted Average number of
Shares based on monthly rests.
ii. Diluted Earnings per shares has been computed based on the fully paid-up value of the
shares issued.
(q) Accounting for Taxes on Income:

Provision for Current Tax is made after taking into Consideration benefits admissible under the
provisions of the Income Tax Act, 1961. Deferred Tax resulting from Timing Differences between
taxable and accounting income is accounted for using the tax rates and laws that are enacted
or Substantially enacted as on the balance sheet date. The Deferred Tax asset is recognized
and carried forward only to the extent that there is a reasonable / virtual certainty that the asset
will be realized in future.
(r). Provisions, Contingent Liabilities and Contingent Assets:

i. A present obligation, which could be reliably estimated, is provided for in the accounts, if it
is probable that an outflow of resources embodying economic benefits will be required for its
settlement.
ii. All the liabilities have been provided for in the accounts except liabilities of a contingent
nature, which have been disclosed at their estimated value by way of notes in the Balance
Sheet.
46
iii. Contingent Assets are neither recognised nor disclosed.
(s). Sundry Debtors / Loans and Advances:

Sundry Debtors and Loans and Advances are stated after making adequate provisions for doubtful
balances.
(t). Expenditure:
Expenses are accounted on accrual basis and provisions is made for all known losses and
liabilities.
For N.C.RAJAGOPAL & CO., SKM. MAEILANANDHAN S.K.M. SHREE SHIVKUMAR

N.C.SAMPATH V.JAGADEESAN
Partner General Manager- Finance &
Place : Erode
Date : 28.07.2008
47
STATEMENT PURSUANTTO SECTION 212 OFTHE COMPANEIS ACT

RELATING TO SUBSIDIARY COMPANY
1. Name of the subsidiary company SKM Europe BV
2. Statement of holding Company's

interest in subsidiary company As on March 31, 2008
As on 31.03.2008
15,300 Shares of Euro 1 each
3. Financial year of the subsidiary company : Period ended March 31, 2008
4. Net aggregate amount of Profit/(Loss)

of the subsidiary as far as it concerns
the holding company :
(a) Dealt with the accounts of SKM Egg

Products Export (India) Limited by way
of dividend on the shares held in the : NIL
subsidiary for the period ending
March 31, 2008.
(b) Not dealt within the accounts of SKM

Egg Products Export (India) Limited
For the period ended March 31,2008 : Rs. 21.68 lakhs
For the previous financial years : Loss Rs. 7.01 lakhs
48
Additional Information as per part IV, Schedule VI to the Companies Act, 1956.
BALANCE SHEET ABSTRACT AND COMPANY'S GENERAL BUSINESS PROFILE
I. Registration Details
Registration No. 181-6025
State Code No. 18
Balance Sheet Date 31.03.2008
II. Capital Raised during the year (Rs. in Thousands)
Public Issue Nil
Rights Issue Nil
Bonus Issue Nil
Private Placement Nil
III. Position of Mobilisation and Deployment of Funds (Rs. in Thousands)
Total Liabilities 9,26,583
Total Assets 9,26,583
Sources of Funds
Paid-up Capital 2,63,300-
Reserves and Surplus 2,59,567
Share application money -
Secured Loans 2,98,601
Unsecured Loans -
Application of Funds
Net Fixed Assets 5,59,674
Investments 20,833
Current Assets 3,46,076
Misc. Expenditure (not written off) —
Accumulated Loss -
IV. Performance of the Company (Rs. in Thousands)
Turnover including other Income 10,70,842
Total Expenditure 9,78,446
Profit Before Tax 92,396
Profit After Tax 84,177
Earnings per Share (in Rupees) 3.20
Dividend Rate % 5.00
V. Generic names of three Principal Products of the Company
Item Code No. 4081100
Product Description EGG POWDER
SKM. MAEILANANDHAN S.K.M. SHREE SHIVKUMAR

Executive Chairman Managing Director
V. JAGADEESAN
Place Erode General Manager- Finance &
Date 28.07.2008 Company Secretary
49
CASH FLOW STATEMENT FORTHEYEAR ENDED 31st MARCH,2008

(Rs. in Lacs)
Particulars As at 31 .03.2008 As at 31 .03.2007
A. CASH FLOW FROM OPERATING ACTIVITIES

(INDIRECT METHOD)
Profit Before Tax 923,96 1,097.62
Adjustments for: — --
Profit on Sale of Fixed Assets (0.32) --
Interest and Dividend Income (40.94) (158.34)
Interest Expenses 289.00 553.65 223.95 344.59
Operating Profit before Working Capital Changes 1,477.61 1,442.21

Adjustments for:
Increase / (Decrease) in inventories (565.39) 361.05
Increase / (Decrease) in Trade and other receivables 1,077.92 18.09
(Increase) / Decrease in Trade and other payables (629.40) (116.87) 19.55 398.69
Cash generated from operations 1,594.48 1,043.53
Interest paid (289.00) (223.95)
Direct Taxes provided (Including deferred tax) (616.15) (15.10)
Grauity Liability (8.95)
Cash Flow from Extra-Ordinary Items
Net Operating Cash Flows 680.38 804.48
B. CASH FLOW FROM INVESTING ACTIVITIES

Purchase of fixed assets (1,994.47) (368.87)
Sale of fixed assets and Subsidy received -- 0.01
Interest & Dividend received 41.26 158.34
Investments including subsidiary 73.04 (203.40)
Net Cash used in Investing Activities (1,880.17) (413.92)
C. CASH FLOW FROM FINANCING ACTIVITIES

Proceeds from issue of Share Capital -- —
Increase / (Decrease) in Share Application Money -- --
Increase / (Decrease) in Term Borrowings 1,323.97 (2.54).
Increase / (Decrease) in Bank Borrowings 22.28 (125.56)
Provision for Dividend and Corporate Dividend Tax (154.02) (153.81)
Net Cash (used in) received from financing activities 1,192.23 (281.91)
Net increase / (Decrease) in cash and cash equivalents (7.56) 108.65
Opening Cash and Cash equivalents 232.28 123.63
Closing Cash and Cash equivalents 224.72 232.28
For and on behalf of the Board SKM.MAEILANANDHAN S.K.WI. SHREE SHIVKUMAR
Place : Erode
V. JAGADEESAN
Date : 28.07.2008
General Manager - Finance &
AUDITORS' CERTIFICATE Company Secretary
We have examined the Cash Flow Statement of M/s. SKM Egg Products Export (India) Limited for the year ended 31st March 2008. The
statement has been prepared by the Company in accordance with the requirements of Clause 32 of the Listing Agreement with the Stock
Exchanges and is based on and is in agreement with the corresponding Profit and Loss Account and Balance Sheet of the Company
covered by our report dated 28.07.2008 to the Members of the Company.
For N.C.RAJAGOPAL & CO.,
Place : Erode
N.C.SAMPATH
Date : 28.07.2008
Partner
50
AUDITORS' REPORTTOTHE BOARD OF DIRECTORS ONTHE CONSOLIDATED FINANCIAL

STATEMENTS OF SKM EGG PRODUCTS EXPORT (INDIA) LIMITED AND ITS SUBSIDIARY
We have audited the attached consolidated balance sheet of SKM EGG PRODUCTS EXPORT (INDIA)
LIMITED (the Company) and its subsidiary SKM Europe BV of the Netherlands, (Collectively called SKM
Group) as at 31st March 2008, the consolidated profit and loss account and the consolidated cash flow
statement for the quarter and year ended on that date, annexed thereto. These financial statements are the
responsibility of the Company's management. Our responsibility is to express an opinion on these financial
statements based on our audit.
We conducted our audit in accordance with auditing standards generally accepted in India.Those Standards
require that we plan and perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit also includes assessing the
accounting principles used and significant estimates made by Management, as well as evaluating the overall
financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.
We report that the consolidated financial statements have been prepared by the Company'^ management in
accordance with the requirements of Accounting Standard (AS) 2 1 , Consolidated financial Statements,
issued by the Institute of Chartered Accountants of India.
In our opinion and to the best of our information and according to the explanations given to us, the said
accounts give a true and fair view in conformity with the accounting principles generally accepted in India:
a. in the case of the consolidated balance sheet, of the state of affairs of the SKM Group as at 31 March
2008;
b. in the case of the consolidated profit and loss account, of the profit of the SKM Group for the year
ended on that date; and
c. in the case of the consolidated cash flow statement, of the cash flows of the SKM group for the year
ended on that date.

Place : Erode N.C.SAMPATH

Date : 28.07.2008 Partner
51
CONSOLIDATED BALANCE SHEET AS AT 31st MARCH, 2008

(Amount in Rs.)
Particulars Schedule As at 31.03.2008 As at 31.03.2007
SOURCEOF FUNDS
Share Capital A 263,300,000 263,300,000
Reserves & Surplus B 261,795,629 245,144,060
Secured Loans C 298,600,873 163,976,720
Minority Interest D 540,263 157,692
876,168,642 672,578,472
Fixed Assets
Gross Block E 774,786,081 575,339,254
Less: Accumulated Depreciation 215,080,848 184,488,268
Net Block 559,705,233 390,850,986
Investment F 20,000,000 27,303,583
Current Assets, Loans
and Advances
Inventories G 166,391,521 211,321,394
Sundry Debtors H 21,700,840 73,365,074
Cash & Bank Balances I 33,779,327 38,571,884
Loans & Advances J 140,187,304 71,027,727
362,058,992 394,286,079
Less : Current Liabilities and
Provision
Current Liabilities K 30,487,584 119,020,112
Provisions L 35,107,999 20,842,064
65,595,583 139,862,176
876,168,642 672,578,472
Notes on Accounts T
1. Significant Accounting policies 11 to t 3.
2. Notes to the accounts (Schedule T) form part of this Consolitated For and on behalf of the Board
Balance Sheet.
3. This is the Consolitated Balance Sheet referred to in our report of even
date.
Place : Erode
Date : 28.07.2008
52
CONSOLIDATED PROFIT AND LOSS ACCOUNT FORTHEYEAR ENDED 31st MARCH,2008

(Amount in Rs.)
Year Ended Year Ended
Particulars Schedule
31.03.2008 31.03.2007
INCOME
Sales M 1,454,330,057 879,563,614
Other Income M 83,210,446 18,753,700
Increase / (Decrease) in Stock N (68,161,714) 55,406,078
Total 1,469,378,789 953,723,392
EXPENDITURE
Purchase and Manufacturing Expenses O 1,163,872,920 662,110,435
Employees' Cost P 38,388,577 30,147,867
Administration & Other Expenses Q 83,224,577 80,983,465
Marketing Expenses R 28,927,531 19,338,290
1,314,413,605 792,580,057
Profit/ (Loss) Before Interest and Depreciation 154,965,184 161,143,335
Interest and Financial Charges S 29,258,958 22,657,079
Profit After Interest 125,706,226 138,486,256
Depreciation E 30,759,627 27,899,316
Profit/(Loss) after Interest & Depreciation (Before Tax) 94,946,599 110,586,940
Provision for Income Tax - MAT 9,399,335 410,000
Provision for FBT 284,023 1,100,000
Provision for Deferred Tax (1,464,283) —
Profit / (Loss) after Income Tax and available for
appropriations 86,727,524 109,076,940
Add (+)/ Less (-): Minority Interest 382,571 (123,787)
Less: Appropriations
a) Provision for proposed dividend 13,165,000 13,165,000
b) Provision for Corporate Dividend Tax 2,237,392 . 2,215,670
15,402,392 15,380,670
Balance carried to Balance Sheet 70,942,561 93,572,483
Earnings Per Share (Basic) 3.20 4.14
Earnings Per Share (Diluted) 3.20 4.14
Notes on Accounts T
1. Significant Accounting policies 11 to t 3.
2. Notes to the accounts (Schedule T) form part of this Consolitated For and on behalf of the Board
Profit and Loss Account.
3. This is the Consolitated Profit and Loss Account referred to in our report
of even date.
Place Erode
Date 28.07.2008 53
CONSOLIDATED SCHEDULES FORMING PART OF THE BALANCE SHEET

AND PROFIT AND LOSS ACCOUNT
(Amount in Rs.)

Authorised Capital:
3,00,00,000 Equity Shares of Rs.10/- each 300,000,000 300,000,000
Issued, Subscribed & Paid-up Capital:
2,63,30,000 Equity Shares of Rs.10/-each fully paid-up 263,300,000 263,300,000
263,300.000 263,300.000

Share Premium Account 400,692 400,692
General Reserve
- Revenue Reserve 115,124 115,124
- Opening Balance 244,628,244 151,055,761
- Less: Provision for Grauity for earlier years (894,832)
- Less: Deferred Tax Liability for earlier years (53,396,160)
- Add: Current Years Balance after appropriation 70,942,561 93,572,483
- Closing Balance 261,279,813 244,628,244
261,795,629 245,144,060
SCHEDULE - C - Secured Loans *
i) From State Bank of India, Commercial Branch, Erode.
Working Capital Finance 122,193,290 119,965,712
Term Loan 175,703,005 43,989,867
iii) KotakMahendra (Vehicle Loan) 704,578 21,141
298,600,873 163,976,720
SCHEDULE - D - Minority Interest
Share Capital 146,961 146,961
Profit 393,302 10,731
540,263 157,692
WORKING CAPITAL FINANCE AND CORPORATE LOAN ARE SECURED BY :
1. Hypothecation of stocks consisting of raw materials, semi-finished goods, finished goods and stores, spares
and other current assets of the Company.
2. First charge on the entire fixed assets of the Company.
3. Personal guarantees of Executive Chairman, Managing Director and Dr. M. Chandrasekar, Director and
Corporate guarantee of M/s. SKM Animal Feeds and Foods (India) Limited.
54
SCHEDULE - E - FIXED ASSETS (Amount in Rs.)
Gross Block Depreciation Net Block

Adjustments Adjustments Total
As at Additions As at up to Depreciation As at As at
DESCRIPTION deductions deductions Depreciation
31.03.2007 during the 31.03.2008 31.03.2007 During the 31.03.2008 31.03.2007
during the during the up to
year year
year year 31.03.2008
Land 19,011,024 26,927,532 45,938,556 45,938,556 19,011,024

Building 102,706,392 83,809,318 186,515,710 22,600,202 3,919,978 26,520,180 159,995,530 80,106,190
Plant & Machinery 390,027,633 36,477,521 426,505,154 148,288,761 22,712,922 171,001,683 255,503,471 241,738,872
Office & Other Equipments 32,994,517 3,618,029 36,612,546 6,679,714 2,155,269 8,834,983 27,777,563 26,314,803
Computers 4,679,786 5,555,128 10,234,914 3,221,274 853,373 4,074,647 6,160,267 1,458,512
Furniture & Fixtures 5,110,955 292,018 5,402,973 2,135,783 337,500 2,473,283 2,929,690 2,975,172
Motor Vehicles 5,888,623 2,640,116 179,000 8,349,739 1,562,534 780,585 167,047 2,176,072 6,173,667 4,326,089
Work in progress 14,920,324 51,888,923 14,920,324 51,888,923 51,888,923 14,920,324
GROSSTOTAL 575,339,254 211,208,585 5,099,324 771,448,515 184,488,268 30,759,627 167,047 215,080,848 556,367,667 390,850,986
PREVIOUS YEAR 538,419,184 36,921,403 1,333 575,339,254 156,588,952 27,899,316 - 184,488,268 390,850,986 381,830,232
Cost of Bird
Un amortised
Adjustments As on 31.03.2008 Bird's Cost value of
DESCRIPTION As at 31.03.2007 Purchase during deductions written off Birds
the year during the
year
Chick Cost - 4,013,848 - 4,013,848 676,282 3,337,566

SCHEDULE - F - Investments
Investments in Mutual Funds
Current Investments (Valued at lower of cost of fair value)
Quoted:
Templeton Indian Equity Income Fund - 152,137
SBI MF MSFU Contra Fund - 171,101
Sundaram BNP Paribas Select Midcap Fund - 1,216,832
Birla Midcap Fund - 1,623,918
Franklin India Prima Plus Fund - 1,500,504
Sundaram BNP Paribas Rural Fund (Dividend Option) - 826,287
Sundaram BNP Paribas Rural Fund (Growth Option) - 168,839
Long Term Investments (Valued at cost)
Birla Infrastructure Fund (Dividend Option) . - 79,285
Birla Infrastructure Fund (Growth Option) - 79,285
UTI Master Value Fund - 835,303
Sundaram BNP Paribas Select Midcap Fund - 83,826
Sundaram BNP Paribas Rural Fund (Dividend Option) - 218,185
Unquoted
Saravana Finance Private Limited 20,000,000 20,348,081
20,000,000 27,303,583

Schedule G - Inventories
Raw Material 5,577,952 9,742,995
Additives, stores, spares and consumables 25,672,472 21,711,051
Finished Goods 82,038,000 141,648,000
Feed & Medicines 3,274,463
Egg Powder at Netherlands 49,828,634 38,219,348
166,391,521 211,321,394
Schedule H - Sundry Debtors
a) Morethan 6 months — —
b) Others: 21,700,840 73,365,074
21,700,840 73,365,074
56
Schedule
(Amount in Rs.)
As at As at
Particulars 31.03.2008 31.03.2007
Schedule 1 - Cash and Bank Balances

i. Cash on hand 503,483 432,530
ii. In Current Account with Scheduled Banks 21,967,206 22,795,780
iii. Fixed deposit with SBI, Commercial Branch, Erode 3,086,054 7,102,268
iv. Current Account with Foreign Banks 8,222,584 8,241,306
33,779,327 38,571,884
Schedule J - Current Assets (Loans and Advances)

i. Advances recoverable in Cash or in kind
for value to be received - unsecured and
considered good 113,636,850 59,706,395
ii. Deposits - considered good 8,040,000 9,719,924
iii. Advance Income Tax and VAT credit 9,607,753 1,601,408
Pre-Operative Expenses - Farm Division 8,902,701 -
140,187,304 71,027,727
Schedule K- Current Liabilities
i. Trade Creditors (Refer note 3 in Schedule S) 27,214,181 114,833,831
ii. Creditors for Expenses & Others 1,235,447 2,502,849
iii. Unpaid Dividends 2,037,956 1,683,432
30,487,584 119,020,112
Schedule L - Provisions
1. Provision for Income Tax - MAT 10,212,335 410,000
2. Provision for Proposed Dividend 13,165,000 13,165,000
3. Provision for Corporate Dividend Tax 2,237,392 2,215,670
4. Provision for EL 1,090,410 527,601
5. Provision for Sales Commission 2,054,139 1,140,000
6. Provision for Genset Tax 1,530,000 930,000
7. Provision of Expenses - 1,353,793
8. Provision for Fringe Benefit Tax 1,384,023 1,100,000
9. Provision for Vat Payable 25,243 -
10. Provision for Bonus 1,162,000 -
11. Provision for L.T.A. 785,977 -
12. Provision for Egg Yolk Powder 481,107 -
13. Provision for Gratuity 933,398 -
14. Provision for loss on Forward Contracts Centurian Bank 46,975 -
35,107,999 20,842,064
57
Schedule
(Amount in Rs.)

Particulars
31.03.2008 31.03.2007
Schedule -M Sales and Other Income
Sales:
Export sales 1,423,003,177 857,976,737
Domestic sales 31,326,880 21,586,877
1,454,330,057 879,563,614
Other Income:
' Sale of Shell egg & scrap 927,000 655,005
Interest received, 2,812,958 1,772,597
Dividend received - Mutual Funds 99,140 2,815,633
VKGJ Scheme - Licence 49,542,000
Drawback 19,941,000
Interest Subsidy 10,663,099
VAT Refund received 1,069,682
Miscellaneous Income 119,817 248,770
Profit on Sale of Investments 1,111,064
Profit on Sale of Assets 32,047
Exchange Fluctuation - Net 8,625,420 1,528,914
83,210,446 18,753,700
SCHEDULE - N- INCREASE/(DECREASE) IN STOCK
Opening Stock Egg Powder at India 141,648,000 115,691,310
Add : Egg Powder Purchase 20,161,000 3,150,000
Closing Stock - Egg Powder at India 82,038,000 141,648,000
(68,161,714) 55,406,078
SCHEDULE - 0- PURCHASE AND MANUFACTURING EXPENSES
Raw material - Eggs Consumed 622,197,899 506,979,919
Cost of Egg Powder Purchase 377,447,193 11,762,888
Import Duty 3,915,096 5,587,470
Customs clearance and other expenses 171,280 351,316
Egg Purchase 7,022,081 22,736,713
Egg Powder Processing Charges 1,008,885 1,696,560
Chick Cost Written off 676,282
Feed & Maize Consumption 11,592,582
Vaccine & Medicine Consumption 1,129,691
Packing Material - Consumption 25,114,033 18,357,081
Power and Fuel 63,556,172 55,380,485
Transport Hire and Cooli 3,787,871 962,640
Additives and Consumables 37,593,855 38,295,363
Conpensation Claim Hainz 8,660,000
i
1,163,872,920 662,110,435
58

Particulars
31.03.2008 31.03.2007
SCHEDULE -P - EMPLOYEES' COST
Salaries and Wages 19,799,390 14,863,269
PF Contribution 1,205,205 981,434
Contractors' Payment 15,001,940 12,043,712
Gratuity Expenses 381,562
Welfare Expenses 2,000,480 2,259,452
38,388,577 30,147,867
SCHEDULE - Q - ADMINISTRATION AND OTHER EXPENSES
Repairs and Maintenance
a. Building 1,894,638 1,030,775
b. Plant and Machinery 3,674,428 1,672,203
c. Others 3,016,706 1,823,844
d. Vehicle (Car, Van and Two Wheelers) 3,281,761 2,950,333
11,867,533 7,477,155
Stores and Spares - consumption 14,218,625 13,788,416

Analysing Charges 5,170,022 8,391,844
Rent, Rates and Taxes 2,192,710 1,966,654
Postage, Courier and Telephone Charges 1,967,354 2,501,346
Printing and Stationery 878,198 925,912
Insurance Premium 1,340,411 1,029,187
Advertisement and Publicity 1,460,682 546,398
Travelling Expenses 4,037,260 3,036,238
Freight, Insurance and Forwarding Charges 32,864,896 26,809,851
Professional Charges 2,489,272 1,765,357
ISO/HACCP-Expenses 446,872 464,006
Stock Exchange Listing Fee 176,474 171,594
Audit fees 684,253 736,562
Donation 2,592,364 2,155,000
Exchange Fluctuation — 1,494,105
Loss on sale of Import Licence — 3,496,059
Loss on sale of Investments (Mutual Funds)- — 2,318,126
Deminition in value of investments — 1,332,458
71,357,044 73,506,310
83,224,577 80,983,465
59

Particulars 31.03.2008 31.03.2007
SCHEDULE - R - MARKETING EXPENSES
Foreign Trip Expenses 2,728,460 1,209,166
Sales Commission to Foreign Collaborators and Others 22,270,655 15,256,077
Foreign Exhibition Expenses 1,616,230 782,252
Sales Promiton Expenses 568,431 639,024
Sample Courier Charges 1,588,300 622,895
Foreign Delegates Expenses 155,455 828,876
28,927,531 19,338,290
SCHEDULE - S - INTEREST AND FINANCIAL CHARGES
Working Capital Loan Interest 8,754,230 8,079,070
Bank Charges & ECGC Charges 2,179,680 1,761,431
Export bills discount interest 3,608,974 5,648,499
Export bills-overdue interest 1,350,246 846,121
Interest paid - others (Vehicles loan etc.) 110,316 40,189
Interest Paid - SBI FD Loan 482,243 90,185
Bill Discount and Collection Charges 2,038,977 1,452,635
SBI - Term Loan Interest 3,326,962 4,738,949
Interest Paid Preshipment 3,823,917
Interest Paid HDFC Loan 1,584,022
Interest Paid Rupee Loan 136,877
Interest Paid Centurian Bank 1,862,514
29,258,958 22,657,079
Schedule T
NOTES ON ACCOUNTS ON CONSOLIDATED FINANCIAL STATEMENTS
1. The consolidated statement has been prepared to include the results of "SKM Europe BV", The
Netherlands, the subsidiary of the company in which the Company holds 85% of the Share Capital of
the Subsidiary Company.
2. Current Years figures in the Consolidated Statements is not comparable with the previous year's figures
since the subsidiary was formed in the last quarter of the previous financial year.
SIGNIFICANT ACCOUNTING POLICIES:
1. Basis of Preparation:
The Consolidated Financial Statements of SKM Egg Products Export India Limited and its subsidiary
are prepared under the historical cost convention and in accordance with the accounting standards
issued by the The Institute of Chartered Accountant of India.
60
2. Principles of Consolidation:
a. The Financial Statements of the subsidiary company used in the consolidation are drawn upto the
same reporting date as of the company.
b. The Consolidate Financial Statement have been prepared on the following basis.
i.. The Financial Statements of the Parent Company and its majority owned and controlled subsidiary
company have been combined on the line basis by adding together the book value of all items
of Assets, Liabilities, Incomes and Expenses after eliminating inter-company balances/
transactions and resulting unrealised gain / loss.
ii. Interest in a jointly control entity is reported using proportionate consolidation.
iii. The consolidated Financial Statements are prepared using uniform accounting policies for similar
transactions and other events in similar circumstances.
iv. Minority interest in the net assets of consolidated subsidiaries consists of the amount of equity
attributable to the minority shareholders at the dates on which investments are made by the
Company in the subsidiary companies and further movements in their share in the equity,
subsequent to the dates of investments.
3. Use of estimates:
The preparation of consolidated financial statements requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities, the disclosures of contingent
assets and liabilities on the date of the consolidated financial statements and reported amounts of
revenues and expenses during the period reported. Actual results could differ from those estimates.
Other Accounting Policies applicable for the holding company are equally applicable for the consolidated
financial statements wherever relevant.
Earnings Per Share:
Particulars 2007 - 2008 2006 - 2007
1. Profit After Tax Rs.863.45 Lacs Rs. 1,089.53 Lacs

2. Weighted Average No. of Shares 2,63,30,000 2,63,30,000
3. Earning Per Share Rs. 3.28 Rs.4.14

Place Erode
Chartered Accountants,
Date 28.07.2008
N.C.SAMPATH,
(PARTNER)
Membership No.009592.
61
CASH FLOW STATEMENT FORTHE YEAR ENDED 31st MARCH, 2008

(Rs. in Lacs)
Particulars As at 31 .03.2008 As at 31 03.2007

(INDIRECT METHOD)
Profit Before Tax 945.64 1,105.87

Adjustments for:
Depreciation 305,93 278.99
Loss on Sale of Fixed Assets (0.32)
Interest and Dividend Income (40.23) (152.51)
Operating Profit before Working Capital Changes 1,503.61 1,458.92
Adjustments for:
Increase / (Decrease) in inventories (449.30) 687.04
Increase / (Decrease) in Trade and other receivables 134.79 637.33
(Increase) / Decrease in Trade and other payables (219.52) (94.99) (943.72) 380.65
Cash generated from operations 1,598.59 1,078.27
Interest paid (292.59) (226.57)
Direct Taxes provided - Including Deferred Tax (616.15) (15.10)
Grauity Liability (8.95)
Cash Flow from Extra - ordinary Items
Net Cash from Operating Activities 680.90 836.60
Purchase of fixed assets (1,994.47) (369.21)
Sale of fixed assets and Subsidy received 0.32 0.01
Interest & Divident received 40.23 152.51
Investments including subsidiary 73.04 (165.73)
Net Cash used in Investing Activities (1,880.88) (382.42)
Proceeds from issue of Share Capital
Increase / (Decrease) in Share Application Money -- --
Increase / (Decrease) in Term Borrowings 1,323.97 (2.54)
Increase / (Decrease) in Bank Borrowings 22.28 (125.56)
Provision for Dividend and Corporate Dividend Tax (154.02) (153.81)
Net Cash (used in) received from financing activities 1,192.23 (281.91)

SKM.MAEILANANDHAN SKM. SHREE SHIVKUMAR
Place : Erode
V. JAGADEESAN
Date : 28.07.2008 General Manager - Finance &
We have examined the Cash Flow Statement of M/s. SKM Egg Products Export (India) Limited for the year ended 31 st March 2008. The
Exchanges and is based on and is in agreement with the corresponding Profit and Loss Account and Balance Sheet o1 the Company
covered by our report dated 28.07.2008 to the Members of the Company. For N.C.RAJAGOPAL & CO.,
N.C.SAMPATH
Place : Erode Partner
Date : 28.07.2008. Membership No. 009592
62
BALANCE SHEET OF SKM EUROPE BV AS AT 31st MARCH, 2008

(Amount in Rs.)
Particulars Schedule As at 31.03.2008 As at 31.03.2007
SOURCE OF FUNDS
Authorised Capital
90,000 shares of Euro 1 each Euro 90,000 Euro 90,000
Paidup Share Capital
Reserve Capital 80,000 shares of
Euro 1 each A 979,740 979,740
Reserves & Surplus B 2,622,024 71,549
Secured Loans C 16,912,558 11,337,201
From the Holding Company 20,514,322 12,388,490
Fixex Assets
Gross Block 34,012 34,012
Less: Accumulated Depreciation 2,558 942
Net Block 31,454 33,070
Current Assets, Loans and Advances

Inventories D 49,828,634 38,219,348
Sundry Debtors E 75,566,282 63,271,013
Cash and Bank balances F 3,086,054 8,241,306
Loans and advances G 721,065 310,908
Total Current Assets 129,202,035 110,042,575

Less: Current liabilties and provisions H 108,719,167 97,687,155

Profit and Loss Account
20,514,322 12,388,490
SKM. SHREE SHIVKUMAR B. KLAWER

Director Director
Place : Erode
Date : 28.07.2008
63
PROFIT AND LOSS* ACCOUNT OF SKM EUROPE BV FOR THE YEAR ENDED 31st MARCH, 2008
(Amount in Rs.)
Schedule Year ended Year ended

Particulars
31.03.2008 31.03.2007
INCOME
Sales I 421,960,475 357,044,353
Other Income I 824,437 1,385,623
Increase in stock J 11,609,286 32,599,388
Total Income 434,394,198 391,029,364
EXPENDITURE
Purchase and Other Expenses K 419,702,401 378,288,967

Administrative and Other Expenses L 1,734,939 4,792,110
Marketing Expenses M 8,767,106 6,210,523
430,204,446 389,291,600
Profit / (Loss) Before Interest & Depreciation 4,189,752 1,737,764
Interest and financial charges N 1,637,661 911,573
Profit/(Loss) After Interest 2,552,091 826,191
Depreciation 1,616 942
NET PROFIT 2,550,475 825,249
SKM. SHREE SHIVKUMAR B. KLAWER

Director Director
Place : Erode
Date : 28.07.2008
64
SCHEDULES FORMING PART OF THE BALANCE SHEET

AND PROFIT & LOSS ACCOUNT OF SKM EUROPE

Share Capital:
90,000 Shares of Euro 1/- each 48,98,700 48,98,700
Paid-up Share Capital:
18,000 Shares of Euro 1/- each fully paid-up 9,79,740 9,79,740
979,740 979,740

- Opening Balance 71,549 (753,700)
- Add: Current Year Balance after appropriation 2,550,475 825,249
- Closing Balance 2,622,024 71,549
2,622,024 71,549
SCHEDULE - C - Secured Loans *
Term Loan
SKM Egg Products Export (India ) Limited 16,912,558 •11,337,201
16,912,558 11,337,201
Schedule D - Inventories
49,828,634 38,219,348
Schedule E- Sundry Debtors
a) Morethan 6 months - -
b) Others: 75,566,282 63,271,013
75,566,282 63,271,013
Schedule F- Cash and Bank Balances
Cash on hand - -
Current Account with Schedule Banks 3,086,054 8,241,306
3,086,054 8,241,306
65
Schedule
SCHEDULE G - Loans and Advances

a) Advances Recoverable in cash or in kind
for value to be received - Unsecured and considered good 128,429
b) VAT to be received back 721,065 182,479
721,065 3,10,908
SCHEDULE H - Current Liabilities
a) Trade Creditors 107,903,176 95,527,250
b) Creditors for Expenses and others 815,991 2,159,905
108,719,167 97,687,155

31.03.2008 31.03.2007
SCHEDULE 1 - Sales and Other Income
Sales :
Egg Powder Sales 420,953,823 356,322,772
Other Sales 1,006,652 721,581
421,960,475 357,044,353
OTHER INCOME
VAT Refund 1,069,682
Interest Received 96,609 67,171
Other Income 119,817 248,770
Foreign Currency Fiucation Difference 608,011 -
824,437 1,385,623
SCHEDULE J - Increse /(Decrease) in Stock

Opening Stock - Finished Goods 38,219,348 5,619,960
Closing Stock - Finished Goods 49,828,634 38,219,348
11,609,286 32,599,388
SCHEDULE K - Purchase and Other Expenses

Purchase of Egg Powder 411,037,006 371,607,246
Other Purchase 988,985 742,936
Import Duty 3,915,096 5,587,470
Transport Charges 2,567,972 11,142
Custom Clearing Charges 171,280 84,810
Loading and Unloading 22,317 230,176
Blending 811,604 -
Packing and Repacking 188,141 25,187
419,702,401 378,288,967
66
Schedule

Particulars 31.03.2008 31.03.2007
SCHEDULE L - Administration and Other Expenses
Godown Rent 405,264 372,069
Postage 206,780 193,935
Travelling 380,913 97,164
VAT Expenses 750,696
Transport Charges 185,356 1,212,746
Audit Fees 331,713 525,332
Internet Expenses 3,301
Membership Fees 45,098 26,328
Insurance 119,065
Foreign Currency Fluctuation Difference 1,494,105
1,734,939 4,792,110
SCHEDULE M - Marketing Expenses

Sales Commission 7,947,806 5,962,756
Sales Promotional Expenses 67,976 95,668
Sample Analysis & Courier Charges 751,324 152,099
8,767,106 6,210,523
SCHEDULE N - Interest and Financial Charges

Interest Paid 1,278,422 649,376
Bank Charges 359,239 262,197
1,637,661 911,573
67
SKM EUROPE BV - CASH FLOW STATEMENT FOR THE YEAR ENDED 31st MARCH, 2008
(Rs. in Lacs)

(INDIRECT METHOD)
Profit Before Tax 25.50 8.25
Adjustments for: -- --
Loss on Sale of Fixed Assets -- -.
Interest and Dividend Income -. -.
Operating Profit before Working Capital Changes 41.90 17.38
Adjustments for:
Increase / (Decrease) in inventories 116.09 325.99
Increase / (Decrease) in Trade and other receivables 127.05 619.24
(Increase) / Decrease in Trade and other payables (110.32) 132.82 (963.27) (18.04)
Cash generated from operations (90.92) 35.42
Interest paid (16.38) (9.12)
Direct Taxes provided
Cash Flow from Extra-ordinary Items
Net Cash from Operating Activities (107.30) 26.30
Purchase of fixed assets (0.34)
Sale of Fixed Assets and Subsidy received
Interest & Dividend received
Investment including subsidiary
Net Cash used in Investing Activities 0.00 (0.34)

Proceeds from issue of Share Capital -- —
Increase / (Decrease) in Share Application Money
Increase / (Decrease) in Term Borrowings 55.75 37.67
Increase / (Decrease) in Bank Borrowings
Provision for Dividend and Corporate Dividend Tax
Net Cash (used in) received from financing activities 55.75 37.67

SKM.MAEILANANDHAN S.K.M. SHREE SHIVKUMAR
Place : Erode
V. JAGADEESAN
Date : 28.07.2008 General Manager - Finance &
We have examined the Cash Flow Statement of M/s. SKM Egg Products Export (India) Limited for the year ended 31 st March 2008. The
Exchanges and is based on and is in agreement with the corresponding Profit and Loss Account and Balance Sheet of the Company
covered by our report dated 28.07.2008 to the Members of the Company.
N.C. SAMPATH
Partner
Place : Erode Membership No. 009592
Date : 28.07.2008
68
(Q^rrena
aSluijib 31.03.2008 31.03.2007
urijg, (\ps,eo 263,300,000 263,300,000

lflfflT6X|a(6TF)Lb C_Ulfl«(GT5Lb 259,566,909 245,083,243
298,600,876 163,976,720
873,399,662 672,359,963
FT-@6TT6TT ffil 6BT£56TT
^Gto&ujn Qffir^§iffia56Tr
J§1^] 6lSll§l(SlUnffiLb
Q i c i r ^ QffrTa5§iffia6TT 774,752,069 575,305,242
ff>i£\g,&> : (SaîLiLDrrsoTLb 215,078,291 184,487,326
iglffilj QfflT^g|«ffi6TT 559,673,778 390,817,916

20,832,779 28,136,362
151 LJi~|s= Q f f r r a j g i , ai_6Hi«6TT Lorr)gjib
(Lp60T QÎT6lDa«66TT
116,562,887 173,102,046
«l_6»IIT6Tflai6TT 42,441,056 10,094,061
Qrrrrasi(ipii euiii^l @(rj,LJi_jii> 30,693,273 30,330,578
«l_6ifT«6TT LUfbgULD (ip6il QgrrSIOffiffiSTT 156,378,797 82,054,019
346,076,013 295,580,704
S L ^ I « % : i j i _ L j q QurrgjUL|«6n 18,074,910 21,332,955
35,107,998 20,842,064
53,182,908 42,175,019
292,893,105 253,405,685
873,399,662 672,359,963
69
6OtTU
(jjurruSlsb)
31.03.2008 31.03.2007
61l([TjLDIT6BTLb
1,066,948,379 883,838,747
© S i l l 6U(r5LDrr6ffrii> 83,664,432 18,017,453
(79,771,000) 22,806,690
1,070,841,811 924,662,890
GlarT6TTQpa56O IDJDgyLD 2_fpU<9jjSilff Glff6\)61|fli>6TT 769,903,960 645,140,953

ffLDUOTTLD 38,388,576 30,147,867
^ ^ 1 7 Glff6V)ff^ffi6TT 81,720,091 76,191,354
6u) JT) U 6tf)6tfT Qff6O6L|8S6TT 28,775,327 13,127,768
Gl L D n " § ^ Gl ff 60 61Jfli6TT 918,787,954 764,607,942
6UI LQ. \c§UJLDrT6in'r&Jft(()rR^(5^ (LpnR6ff)§LLJ v9i'6On'LJLD 152,053,857 160,054,948

QjiluîDibgiihig^GlâiasiT 28,899,720 22,394,882
61JL_L);ffi(gU LSl6BT@6OITLJli) 123,154,137 137,660,066
CSÛJLOrTSHTLD 30,758,012 27,898,374
92,396,125 109,761,692
aiiflaanOTT cjgias^® Income Tax, FBT 9,683,358 1,510,000
suifl««ir65r s^gja^© Deffered Tax (1,464,283) -
6Ulfl«@U LS16HT @60ITUlD 84,177,050 108,251,692
13,165,000 13,165,000
2,237,392 2,215,670
15,402,392 15,380,670
68,774,658 92,871,022
70
Registered Office: 185, Chennimalai Road, Erode - 638 001.
ATTENDANCE SLIP
Regd. Folio No./Client ID/DP ID No.:
Thirteenth Annual General Meeting on Tuesday, the 9th September, 2008 at

4.00 p.m. at Kongu Kalaiarangam, E.V.K.Sampath Nagar, Erode - 638 011.
I hereby record my presence at the 13th ANNUAL GENERAL MEETING of the Company
held at Kongu Kalaiarangam, E.V.K.Sampath Nagar, Erode - 638 011, on Tuesday, the 9th
September, 2008 at 4.00 p.m.
I am a shareholder of the Company*

I am a Proxy/Authorised Representative of the shareholder(s)*
My name is
* Please strike off any one which is not applicable
Signature
Request to Members :
1. Shareholders and proxies should bring the attendance slip duly filled-in for attending
the Meeting and hand it over at the entrance of the Meeting Hall.
2. Members are requested to avoid being accompanied by non-members and/or children.

Registered Office: 185, Chennimalai Road, Erode - 638 001.
PROXY
Regd. Folio No./ Client ID / DP ID No No. of Shares Held :
I/We of
in the district of
being a member/members of SKM EGG PRODUCTS EXPORT (INDIA) LIMITED, hereby appoint
of in the district
of or failing him of
in the district of as my/our Proxy to
vote for me/us on my/our behalf at the 13 th Annual General Meeting of the Company to be held
on Tuesday, 9th September, 2008 at 4.00 p.m. and at any adjournment thereof.
Affix
One Rupee
Signed this day of 2008 Signature Revenue
Stamp
Note: The Proxy must be deposited at the Registered Office of the Company not less than
48 hours before the time for holding the Meeting.
ereio.Ga.6Tib. 6X3>
1 8 5 , Qs=6DT6»flLD6Tr)6O (Sirrr©, pr<2rrrr© - 6 3 8 OO1.
6U(JTj6ff>8S
Folio No : / Client ID Mo./ DP ID No :
O9.O9.
6 3 8 0116O
C_I_6«T
.(offi.ffrih. 6TS,
1 8 5 , Qa=6DT6Bflu>«n6O CSirrr©, rrCSrriT© - 6 3 8 O O 1 .
Folio No : / Client ID No./ DP ID No :
09.09.2008^10 (S^^luSl60
^^l60 i o i l © i b
185, Qff6sr65fln>6in60 ffnsmeo, FT-CITIT© - 6 3 8 0 0 1 6T6injr)
ll_^^l6iiT 4 8 LDOTlfl (SjlJ-^^lft)© (Lp6BTUIT«
THINKING OUT OF THE SHELL
Value of Exc&llence
To be a leader in the sectors we operate with the responsibility of building a healthy society.
MISSION
* Contribute for social needs
$r Sustain integrity and honesty
* Maximise the value of stakeholders
* Innovate and excel in whatever we do
Toacy
To delight our customers, we understand, develop & deliver, safe & high functional products &
services through continuous improvement.

SKM Egg Products Exp India Ltd-532143-March-2008

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THIRTEENTH ANNUAL REPORT

• Excellence - Our Goal

Silver Trophy Award from APEDA

Silver Award from Frost & Sullivan

Silver Trophy Award from APEDA

BOARD OF DIRECTORS Shri. SKM. MAEILANANDHAN

Shri. SKM. SHREE SHIVKUMAR

Shri. S.M. VENKATACHALAPATHY

GENERAL MANAGER - OPERATIONS Shri. S. HARIHARAN, B.Sc, B.Tech., (Food Tech.

AUDITORS N.C.RAJAGOPAL & CO.,

BANKERS STATE BANK OF INDIA

REGISTERED OFFICE 185, Chennimalai Road,

FACTORY Erode to Karur Main Road,

SKM EGG PRODUCTS EXPORT (INDIA) LIMITED

1. To receive, consider and adopt:

b. The audited Balance Sheet as at 31 sl March, 2008.

c. The Director's and Auditor's Report thereon.

iii. Reimbursement of Medical Expenses for self and family.

By order of the Board

By order of the Board

Memorandum of Interest of Directors.

Listing on Company's Equity Shares

Month Bombay Stock Exchange Limited National Stock Exchange Limited

National Stock Exchange of India (NSE) SKMEGGPROD

The Bombay Stock Exchange Ltd 532143

NSDL&CSDL INE411 D1015

Share Transfer System:

1-500 6,895 68.67 21,48,351 8.16 5,954 66.02 20,14,477 7.65

501-1000 1,628 16.21 13,97,112 5.31 1,553 17.22 13,27,926 5.04

1001-2000 427 4.25 6,57,241 2.50 386 4.28 5,90,119 2.24

2001-3000 721 7.18 17,90,020 6.80 774 8.58 19,20,672 7.29

3001-4000 54 0.54 1,95,969 0.74 51 0.57 1,80,711 0.69

4001-5000 152 1.51 7,40,858 2.81 148 1.64 7,23,558 2.75

5001-10000 99 0.99 7,89,256 3.00 93 1.02 7,51,171 2.85

10001 & above 65 0.65 1,86,11,193 70.68 60 0.67 1,88,21,366 71.49

Total 10,041 100.00 2,63,30,000 100.00 9,019 100.00 2,63,30,000 100.00

Registrar and Transfer Agent

Promoters 12 0.12 1,62,84,182 61.85 14 0.12 1,65,99,604 63.04

Name of the Depository No.of Shares %

National Securities Depository Ltd 55,92,920 21.24

Central Depository Services (India) Ltd 1,43,50,186 54.50

Total 1,99,43,106 75.74

185 - Chennimalai Road

Place: Erode SKM. MAEILANANDHAN

DIRECTORS' RE-PORT AND MANAGEMENT ANALYSIS

DESCRIPTION 2007-2008 2006-2007

Net Sales 10,669.48 8,838.39

PROSPECTS FORTHE FINANCIAL YEAR 2008-09:

DELISTING OF COMPANY'S EQUITY SHARES

DIRECTORS' RESPONSIBILITY STATEMENT:

GROSS QUALI- EXPERI- DATE OF PREVIOUS

Shri. SKM. 64 Executive 29,00,159 SSLC 23 Years 26.06.96 Managing

By Order of the Board

Place: Erode SKM. MAEILANANDHAN

ANNEXURE TO THE DIRECTORS' REPORT

PARTICULARS 2007-2008 2006-2007

(I) POWER AND FUEL CONSUMPTION

(II) CONSUMPTION PER UNIT OF PRODUCTION

FOREIGN EXCHANGE EARNINGS AND OUTGO: (Rs. in lacs)

RESEARCH AND DEVELOPMENT:

Place: Erode SKM. MAEILANANDHAN

MANAGEMENT DISCUSSION AND ANALYSIS

STRENGTH OFTHE COMPANY: