To
The Shareholders.
Superhouse Limited,
Kanpur.

The Directors have pleasure in presenting their 27th Annual Report alongwith the Audited Accounts of your Company for the year ended 31st March, 2007.

DIVIDEND
Your Directors are pleased to recommend final dividend of Rs. 1.50 per equity share (previous year Rs. 1.00 per equity share) on the equity share capital of the company for the financial year ended 31 March, 2007. This includes the interim dividend of Rs. 1.00 per equity share paid during the year. The cash outflow on account of dividend on equity capital will be Rs.164.21 lacs (previous year Rs. 90.29 lacs) including dividend tax of Rs. 21.45 lacs (previous year Rs. 11.11 lacs).

Financial Performance:-
The company has achieved the sales and other Income of Rs. 32702.55 lacs against Rs. 23201.38 lacs reported last year. The Profit after Tax was Rs. 706.65 lacs during the year under review as compared to Rs.474.31 lacs reported during the previous year.

Recognition :-
Council for Leather Exports :- Mr. Mukhtarul Amin, Chairman and Managing Director of the company has been unanimously elected as Chairman of Council for Leather Exports, a body functioning under Ministry of Commerce and Industries, Government of India, forthe period 2007-2009.

Gold Trophy:- Your company has once again bagged the most prestigious Golden Peacock Award for the best performance in Overall Export in leather industry. The companies with total FOB export turnover of leather and leather products of Rs. 100.00 crore and above are eligible for considering this award. In addition to Gold Trophy, the company has also claimed five other outstanding awards for Brand Promotion, Export of non-leather harness and saddlery, maintaining high standard for environment production and adhering to International Standard of quality, health and safety.

Amalgamation with Super Footwear Limited and Allen Shoes Limited :-
M/s Super Footwear Limited and M/s Allen Shoes Limited have been amalgamated with the company during the year. The combined financial and other resources of all the three companies have resulted in better and more profitable utilization of these sources and the company has been better placed for further profitable growth.

Delisting of Equity Shares :-
The Equity Shares of the company have been delisted from the Stock Exchanges at Kanpur, Delhi and Ahmedabad. The delisting application of the Calcutta Stock Exchange is pending with the Exchange. However, the Listing of Equity Shares of the company will be continued with the Bombay Stock Exchange.

Subsidiary Companies :-
The company is having three wholly owned subsidiary companies namely M/s Superhouse (UK) Limited, M/s Superhouse (USA) International Inc and Superhuose Middle East FZC. A statement pursuant to section 212 of the Companies Act,1956 relating to company's interest in subsidiaries companies is forming part of the AnnualAccounts.

Corporate Governance :-
During the year under review, the company has taken necessary steps to comply with the requirements of the Corporate Governance Code and a Report on the Corporate Governance forms part of this Report.

Consolidated Financial Statement :-
As required by clause-32 of the Listing Agreement and in accordance with the Accounting Standard-21 your directors have pleasure to attach the Consolidated Financial Statements and Cash Flow Statement which form part of the Annual Report and Accounts.

Management Discussion and Analysis :-
The Report as required by clause-49 of the Listing Agreement is annexed hereto and form part of the report.

Personnel :-
The relations with the employees continued to be cordial during the year. The Directors record their appreciation for the sincere and hard work put in by all categories of employees during the year.

Conservation of Energy :-
Your Company is engaged in the manufacture of Finished Leathers, Leather Goods and Textile Garments and consumption of energy in these industries is not significant as compared to that of in other industries. However, the Company is making continuous efforts to conserve energy wherever possible by economizing on use of power and fuel in factory and offices. The company has also conducted the Energy Audit of various factories and offices of the company. However, the company has not made specific additional investment for the reduction of consumption of energy.

Technology Absorption :-
The company is carrying on the technological innovations, up-gradation and improvements on a regular way. The company is getting benefit of R & D by developing new range of Products.

The company is hopeful that sustained efforts put in by all concerned and that will continue in future to achieve excellent working results and improve competitive strength of the company.

The company has incurred expenditure of Rs.45.65 lacs for the Research and Development Activities during the year. The company has not incurred any capital expenditure on R&D during the year.

The company is not using imported technology, However, Imported Plants and Machineries are also being used by the company.

Foreign Exchange Earnings & Outgo :-
Your Company continues to enjoy the status of a Government of India Recognized Export House. Continuous efforts are being made to identify the new markets. Exports during the year was Rs.24572.11 lacs in comparison to previous year of Rs.17842.35 lacson FOB basis. During the year, total Foreign Exchange outgo was Rs.5208.39 lacs as compared to Rs.3574.86 lacs during the preceding financial year.

Particulars of Employees u/s 217 :-
No employee was covered Under Section 217(2-A) of the Companies Act, 1956 during the year.

Directors :-
Mr. Krishna Kumar Agarwal, Mr. Anil Soni and Mr. Sartaj Ahmad retire by rotation at the ensuing Annual General Meeting. However, being eligible they offer themselves forre-election.

Directors' Responsibility Statement :-
In accordance with the provisions of section 217(2AA) of the Companies Act, 1956 your Directors confirm that:

1. In the preparation of the annual accounts the applicable accounting standards have been followed;

2. They have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at 31st March, 2007 and of the profit of the Company for the year ended on that date;

3. They have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 1956 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;

4. They have prepared the annual accounts on a going concern basis.

Statutory Auditors :-
M/s. Kapoor Tandon &Co. present Auditors will hold office until the conclusion of this Annual General Meeting. We have received a certificate from the Auditors to the effect that their re-appointment, if made, will be in accordance with the limits specified in sub section(1B) of Section 224 of the Companies Act, 1956. Directors commend for re-appointment of M/s. Kapoor Tandon & Co.

Cost Auditors :-
The Central Government vide its Order No. 52/348 CAB-2000 dated 10th August, 2000 has directed the company to carry out audit of the Cost accounts maintained by the company in respect of Footwear. Your board has appointed M/s. R. M. Bansal & Co., Cost Accountants to carry out the Cost Audit for this purpose. This appointment has to be made in the beginning of each financial year and an application has already been forwarded to the Central Government to renew the appointment for the current financial year.