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AIA Engineering Ltd.

BSE: 532683 Sector: Engineering
NSE: AIAENG ISIN Code: INE212H01026
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OPEN 1591.60
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VOLUME 7153
52-Week high 1660.00
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P/E 35.87
Mkt Cap.(Rs cr) 15,589
Buy Price 1653.10
Buy Qty 22.00
Sell Price 0.00
Sell Qty 0.00
OPEN 1591.60
CLOSE 1590.85
VOLUME 7153
52-Week high 1660.00
52-Week low 1237.95
P/E 35.87
Mkt Cap.(Rs cr) 15,589
Buy Price 1653.10
Buy Qty 22.00
Sell Price 0.00
Sell Qty 0.00

AIA Engineering Ltd. (AIAENG) - Director Report

Company director report

The Members

AIA Engineering Limited

Ahmedabad

Your Directors take pleasure in submitting the 27th Annual Report andthe Audited Annual Accounts of the Company for the year ended 31st March 2017.

1. FINANCIAL HIGHLIGHTS (Rs in Lacs)

Standalone Consolidated
P a r t i c u l a r s Year ended 31st March 2017 Year ended 31st March 2016 Year ended 31st March 2017 Year ended 31st March 2016
Revenue from Operations 206364.94 183945.75 223923.48 212715.29
Other Operating Income 5874.61 4493.22 8110.82 4523.55
Total Income from Operations (net) 212239.55 188438.97 232034.30 217238.84
Other Income 13897.00 35791.80 10444.23 10193.80
Total Income 226136.55 224230.77 242478.53 227432.64
Profit before Finance Cost Depreciation 69681.65 87232.58 73901.24 71124.74
& Amortization and Tax Expenses
Finance Cost 446.39 446.82 449.22 487.27
Depreciation & Amortization 7128.90 6414.10 7247.71 6551.60
Profit Before Tax 62106.36 80371.66 66204.31 64085.87
(i) Provision for Taxation (Current) 17200.00 16415.04 17366.59 16476.47
(ii) Provision for Taxation (Deferred) 3175.01 2393.80 3116.40 1929.98
Total Tax (i+ii) 20375.01 18808.84 20482.99 18406.45
Profit after 41731.35 61562.82 45721.32 45679.42
Non-Controlling Interest - - (42.31) 11.11
Net Profit after Non-Controlling Interest 41731.35 61562.82 45679.01 45690.53
Other Comprehensive Income (169.33) 232.07 (1788.49) 380.15
Total Comprehensive Income /(Expenses) 41562.02 61794.89 43890.52 46070.68

The Company has adopted Indian Accounting Standards (Ind AS) from 1stApril 2016. The figures for the Year ended 31st March 2016 are also Ind AS compliant.

Standalone Operating Results:

DuringtheyearunderreviewtheRevenuefromoperations of the Company is Rs212239.55 Lacs as compared to Rs 188438.97 Lacs in the previous Financial Year.

Exports Turnover registered in the same period was Rs 143383.31 Lacsas against the Export Turnover of Rs 121400.08 Lacs in the previous Financial Year.

During the year under review Company has earned a Profit Before Tax(PBT) of Rs 62106.36 Lacs and Profit

After Tax (PAT) of Rs 41731.35 Lacs as compared to PBT of Rs 80371.66Lacs and PAT of Rs 61562.82 Lacs respectively in the previous Financial year.

Consolidated Operating Results:

During the year under review on a Consolidated basis your Company(together with its Subsidiaries) has earned Revenue from Operations of Rs 232034.30 Lacsas compared to Rs 217238.84 Lacs in the previous

Financial Year. Correspondingly the Consolidated Profit

After Tax (PAT) registered during the year under review is Rs 45679.01Lacs (After Non Controlling Interest) as compared to PAT (After Non Controlling Interest)of Rs 45688.71 Lacs in the previous Financial Year.

2. DIVIDEND:

During the year under review the Company has declared and paid anInterim Dividend of Rs 4/- (200%) per share on 94320370 Equity Share of the face valueof Rs 2/- each amounting to Rs 3772.81 Lacs for the Financial Year 2016-17 on 13thFebruary 2017.

The Board of Directors are pleased to recommend a Final Dividend of Rs4/- (200%) per Equity Share of the face value of Rs 2 each amounting to Rs 3772.81 Lacsfor the Financial Year 2016-17.

The total Dividend outgo for the year ended 31st March 2017 would beRs 7545.62 Lacs (excluding the Corporate Dividend Tax).

3. SHARE CAPITAL:

The paid up Equity Share Capital of the Company as on 31st March 2017is Rs 1886.41 Lacs. During the year under review the Company has neither issued shareswith differential voting rights nor granted stock option or sweat equity.

4. FINANCE:

Cash and cash equivalents as at 31st March 2017 were Rs 94827.71Lacs. The Company continues to focus on judicious audit observations andcorrectivemanagement of its Working Capital

Receivables Inventories all other Working Capital parameters werekept under strict check through continuous monitoring.

Capital Expenditure Outlay:

During the year under review the Company has incurred

Rs 7494.71 Lacs (including Rs 463.29 Lacs of Capital work-in-progress)on Capital Expenditure.

Deposits:

During the year under review the Company has neither accepted norrenewed any deposits within the meaning of Section 73 of the Companies Act 2013.

Particulars of Loans Guarantees or Investments:

During the year under review Company has not provided any loan but ithas provided a guarantee covered under the provisions of Section 186 of the Companies Act2013. The details of Guarantees provided and Investment made by the Company are given inthe notes to the Financial Statements.

Internal Control and Audit:

The Company has a proper and adequate system of Internal Controlcommensurate with its size and the nature of its operations to ensure that all assets aresafeguarded and protected against loss from unauthorized use or disposition and thosetransactions are authorized recorded and reported correctly. The Company has successfullymigrated to the SAP-ERP system which has also helped in further strengthening the InternalControl System. Again during the Fiscal Year

2016-17 your Company has comprehensively reviewed and re-designed theInternal Financial Controls across the organisation encompassing all key functional areasas well as covering the entire gamut of entity/operational level controls commensuratewith the nature and size of business.

The Board of Directors at the recommendations of the Audit Committeeappointed M/s. Shah & Shah Chartered Accountants as Internal Auditors of the CompanyM/s. NRCA & Associates Chartered Accountants as Internal Auditors for Nagpur Unit andRajesh Dudhara & Co. Chartered Accountants as Internal Auditors for Trichy

Unit of the Company for the Financial Year 2017-18. Internal Auditorsmonitor and evaluate the efficacy and adequacy of Internal Control System in the Companyits compliance with operating systems accounting procedures policies at all locations ofthe Company.

Significant thereon are presented to the Audit Committee of the Board.

Related Party Transactions:

All the Related Party Transactions entered into during the financialyear were on an Arm's Length basis and in the Ordinary Course of Business. There areno materially made by the significant

Company with Promoters Directors Key Managerial Personnel (KMP) whichmay have a potential conflict with the interest of the Company at large.

Prior Omnibus approval of the Audit Committee is obtained on yearlybasis for the transactions which are of a foreseen and repetitive nature. The transactionsentered into pursuant to the omnibus approval so granted were placed before the AuditCommittee and the Board of Directors for their approval on quarterly basis. The details ofRelated Party Transactions entered by the Company are disclosed in Form AOC-2 as per

Annexure “A”.

The Policy on Related Party Transactions as approved by the Board ofDirectors is uploaded on the website of the Company viz http://www.aiaengineering.pdf/POLICYONRELATEDPARTYTRANSACTIONS.pdf

Credit Rating:

CRISIL has reaffirmed both the Long Term and Short

Term rating of the Company as CRISIL AA+/Stable and CRISIL A1+respectively.

Dun & Bradstreet Information India Private Limited (D & B) hasevaluated the Company during October 2016 and reassigned a Dun Bradstreet Rating of 5A1which indicates that overall status of the Company is “Strong”.

5. HUMAN RESOURCE:

The Company gives utmost importance to its Human Resources and believesthat employee involvement is crucial for sustaining growth. Our Human Resource policytherefore promotes employee engagement at all levels. Organization structure design roleprofiles and goal setting exercise are periodically reviewed and strengthened to inculcatea performance oriented culture in the organization and provide adequate growthopportunities within the organization. Behavioral

& Technical training programmes and motivational seminars areregularly organized to enhance technical competencies and keep employees motivated andinvolved. The employees are also encouraged to participate in sporting events inside andoutside the Company to foster team spirit. As a result of all these initiatives we areable to sustain and strengthen employees' bond with the Company which has resulted invery low attrition rates for many years.

6. MATERIAL CHANGES TRANSACTIONS AND

COMMITMENTS:

On termination of Joint Venture and Shareholders' Agreementbetween Mr. Bhadresh K. Shah Managing Director of the Company and MagotteauxInternational S.A. Belgium (Magotteaux) a Settlement Deed dated

16th February 2000 was executed. Under the arbitral mechanism providedin Settlement Deed Magotteaux has initiated arbitral proceedings against Mr. Bhadresh K.Shah and the Company before the International Chamber of Commerce London (ICC) claimingthe reliefs of injunction and damages inter alia alleging infringement of its Patent bythe Company (in relation to the Company's Sintercast Product) and breach of theSettlement Deed (in relation to Company's Sintercast product).

The amount involved in the said arbitral dispute is approximately US $60 Mn including costs and damages. However the Company disputes the arbitration requestand denies the allegations made therein and is confident of successfully defending thematter in accordance with law.

7. BUSINESS PROSPECTS:

Future growth prospects of the Company will rely on making furtherinroads in mining industry worldwide. The growth prospects are primarily emanating out ofthe largeannualreplacementmarketinthisindustryprimarily in four major metal ore typesviz. Iron Platinum Gold and Copper. The Company is now focusing on certain strategicdrivers in the Mining Segment over and above the cost reduction due to much lower wearrates owing to High Chrome viz. improved process efficiencies reduction in the cost ofother consumables (other than high-chrome grinding media) significantly reducedenvironment hazards and consequently improved environmental benefits etc. for providingcomprehensive solution to the mining industry. This has helped your Company in creating aunique positioning which augurs well for the consistent and steady growth in this industryover medium to long term. Reliance on multiple ores means that declining fortunes of onecommodity will not significantly impact your Company's growth prospects.

During last few years we have steadily increased our presence in themajor mining groups across the globe with a stronger focus on major mining centers likeNorth America Latin America Australia Africa and the

Far East Asia etc. The Company has fairly aggressive growth plans soas to capitalize upon the available opportunity in the mining segment and the vision is toemerge as the leading global solution provider in this segment. While the current focus ofthe Company in mining segment is outside India your Company also has a major share of thedomestic mining demand and shall be able to capture incremental demand as and when thesame arises.

In as much as the cement segment is concerned the near term prospectscontinue to remain flat although in India it seems that the average capacity utilizationlevels of cement companies have started to go up. It is also expected that with thegovernment taking lot of initiatives on the infrastructure segment more particularly theroad construction and port infrastructure it might provide much needed stimulus to theoverall construction and industrial segments and it is hoped that from the current fiscalyear onwards the positive impact of this stimulus should start coming in. As and whenIndia's cement production will go up your company will be an immediate beneficiary interms of incremental production going to service the additional requirement. On the globalfront while most of the key markets like North America Latin America Western andEastern Europe Africa etc. continue to remain sluggish there are certain specificmarkets in Asia Africa and South America which continue to add capacity or haveincreased capacity utilization. In China the Company currently maintains a limitedpresence by marketing specific products. On the whole in near term your Companycontinues to believe that the overall production and sales will remain flat in thissegment.

In the Utility sector (Thermal Power Plants) which is more prominentin the domestic market your Company continues to enjoy a niche position. The Company willstrive to maintain a steady growth rate in this particular segment matching with the rateat which the sector grows.

8. FUTURE EXPANSION:

The Company's effective capacity reached 340000 Metric Tonnesafter successful commission of Phase I of

Kerala GIDC brownfield expansion project during 2016-

17. We are on track for of implementing second phase of capitalexpenditure plan at GIDC Kerala involving augmentation of the total capacity by further100000

MT which is expected to be commissioned in FY 2018-

19 which will take the total installed capacity to 440000 MT. Theincremental Capex to be incurred for the second phase is estimated around Rs 350 Croresand the same is being funded entirely from internal cash accruals.

9. SUBSIDIARY COMPANIES:

In accordance with the Indian Accounting Standard

(Ind AS) - 110 on Consolidated Financial Statements as provided underthe Securities and Exchange Board of India (Listing Obligations and DisclosureRequirements) Regulations 2015 (“SEBI Listing Regulations”) the auditedConsolidated Financial Statements are provided in the Annual Report which show thefinancial resources assets liabilities income profits and other details of the

Company and its subsidiaries as a single entity as per

Annexure “B”.

The Company will make available the Annual Accounts of the SubsidiaryCompanies and the related detailed information to any member of the Company who may beinterested in obtaining the same. The annual accounts of the Subsidiary Companies willalso be kept open for inspection at the Registered Office of the Company. The ConsolidatedFinancial Statements presented by the Company include financial results of its Subsidiary

Companies.

10. INSURANCE:

The Company has taken adequate insurance coverage of all its assets andInventories against various types of risks viz. fire floods earthquake cyclone etc.

11. INDUSTRIAL RELATIONS (IR):

The Company continues to maintain harmonious industrial relations.Company periodically review its HR policies and procedures to aid and improve the livingstandards of its employees and to keep them motivated and involved with the largerinterests of the organization. The Company has systems and procedures in place to hear andresolve employee's grievances in a timely manner and provides avenues to itsemployees for their all-round development on professional and personal levels. All thesemeasures aid employee satisfaction and involvement resulting in good IndustrialRelations.

12. CORPORATE GOVERNANCE:

In line with the Company's commitment to good Corporate GovernancePractices your Company has complied with all the mandatory provisions of CorporateGovernance as prescribed in Regulations 17 to 27 of the SEBI Listing Regulations.

A separate report on Corporate Governance and Practicing CompanySecretaries Report thereon is included as a part of the Annual Report.

13. MANAGEMENT'S DISCUSSION AND ANALYSIS (MDA):

MDA covering details of operations International markets Research andDevelopment Opportunities and Threats etc. for the year under review is given as aseparate statement which forms part of this Annual Report.

14. RISK MANAGEMENT:

In compliance with the provisions of Regulation 21 of SEBI ListingRegulations the Board of Directors has constituted a Risk Management Committee. Thedetails of Committee and its terms of reference are set out in the Corporate GovernanceReport forming part of the Board's Report.

The Company has a robust Risk Management framework to identifyevaluate business risks and opportunities. Corporate Risk Evaluation and Management is anongoing process within the Organization. The Company has a well-defined Risk Managementframework to identify monitor and minimizing/mitigating risks. The Risk Managementframework has been developed and approved by the senior management in accordance with thebusiness strategy.

The key elements of the framework include:

Risk Structure;

Risk Portfolio;

Risk Measuring & Monitoring and

Risk Optimizing.

The implementation of the framework is supported through criteria forRisk assessment Risk forms & MIS. The objectives and scope of Risk ManagementCommittee broadly comprises of:

Oversight of risk management performed by the executive management:

Reviewing the Corporate Risk Management Policy and framework within thelocal legal requirements and Listing Regulations;

Reviewing risks and evaluate treatment including initiating mitigationactions and ownerships as per a predefined cycle;

Defining framework for identification assessment monitoringmitigation and reporting of risks.

15. POLICES:

(a) Vigil Mechanism / Whistle Blower Policy:

The Company has adopted a Vigil Mechanism/ Whistle Blower Policythrough which the Company encourages employees to bring to the attention of SeniorManagement including Audit and Risk Management Committee any unethical behavior andimproper practice and wrongful conduct taking place in the Company. The brief details ofsuch vigil mechanism forms part of the Corporate Governance Report.

(b) Policy on protection of Women against Sexual Harassment atWorkplace: In line with the Sexual Harassment of Women at workplace (PreventionProhibition and Redressal) Act 2013 and Rules made thereunder the Company has adopted apolicy for the same. The brief details of the said policy form part of the CorporateGovernance Report of this Annual Report. The Company has not received any complaints inthis regard.

(c) Code of Conduct to Regulate Monitor and Report Trading byInsiders: In pursuance to the Securities and Exchange Board of India (Prohibition ofInsider Trading) Regulations 2015 and the SEBI Listing Regulations the Company adoptedthe Code of Conduct to regulate monitor and report trading by the employees insider andconnected person(s) in order to protect the Investor's Interest. The details of thesaid Code of Conduct forms part of the Corporate Governance Report.

(d) Policy for Business Responsibility:

In pursuance of Regulation 34 of SEBI Listing Regulations top 500companies based on market capitalization (calculated as on March 31 of every financialyear) are required to prepare and enclose with its Annual Report a BusinessResponsibility Report describing the initiatives taken by them from an environmentalsocial and governance perspectives. The policy for Business Responsibility was placed andapproved in the Board Meeting of the Company held on 13.02.2017.

A separate report on Business Responsibility is Annexed herewith as Annexure“C”.

(e) Dividend Distribution Policy:

The Board of Directors had approved the Dividend Distribution Policy inline with SEBI Listing Regulations. The policy is Annexed herewith as Annexure“D” to this Board‘s Report.

16. DIRECTORS AND KEY MANAGERIAL PERSONNEL:

(a) Board of Directors:

The Board of Directors of the Company is led by the Independent NonExecutive Chairman and comprises eight other Directors as on 31st March 2017 includingone Managing Director one Whole-Time Director three Independent Directors and threeNon-Executive Directors (other than Independent Directors).

All the Independent Directors of the Company have furnisheddeclarations that they meet the criteria of Independence as prescribed under the CompaniesAct 2013 and Listing Regulations.

Mrs. Khushali S. Solanki (DIN -07008918) Director of the Companyretires by rotation at the ensuing Annual General Meeting and being eligible offeredherself for re-appointment.

The Term of Mr. Yashwant M. Patel as Whole-Time Director came to an endon 31st March 2017. The Board therefore recommends his re-appointment as Whole-TimeDirector for a further period of

5(Five) Years w.e.f. 1st April 2017.

The Nomination and Remuneration Committee recommended the Board for there-appointment of Mr. Yashwant M. Patel as Whole-Time Director and the Board hasre-appointed him as the Whole-Time Director subject to the approval of members of theCompany at the ensuing 27th Annual General Meeting.

As required under SEBI Listing Regulations amended from time to timethe information on the particulars of the Directors proposed for re-appointment has beengiven in the Notice of the Annual General Meeting.

(b) Meetings:

During the year under review Four Board Meetings and Four AuditCommittee meetings were convened and held. The details of composition of Audit Committeeis as under:- Mr. Rajendra S. Shah Chairman Mr. Sanjay Shailesh Majmudar Member Mr.Bhadresh K. Shah Member Mr. Rajan Ramkrishna Harivallabhdas Member All recommendationsmade by the Audit Committee during the year were accepted by the Board. The details ofComposition of other Committees and dates of the meetings are given in the CorporateGovernance Report. The intervening gap between the meetings was within the periodprescribed under the Companies Act 2013 and SEBI Listing Regulations.

(c) Committees of the Board of Directors:

In compliance with the requirement of applicable laws and as part ofthe best governance practice the Company has following Committees of the Board as on 31stMarch 2017.

(i) Audit Committee

(ii) Stakeholders' Relationship Committee (iii) Nomination andRemuneration Committee (iv) Corporate Social Responsibility Committee (v) Risk ManagementCommittee The details with respect to the aforesaid Committees form part of the CorporateGovernance Report.

(d) Board Evaluation:

Pursuant to the provisions of the Companies Act 2013 (the Act) andSEBI Listing Regulations the Board has carried out an annual performance evaluation ofits own performance the Directors individually as well as the evaluation of the workingof its Committees. The manner in which the evaluation has been carried out has beenexplained in the Corporate Governance Report.

(e) Whole-Time Key Managerial Personnel:

Mr. Bhadresh K. Shah has been re-appointed as

Managing Director for a further period of 5 (Five) years w.e.f. 1stOctober 2016.

(f) Familiarization Program for Independent Director:

The Independent Directors have been updated with their roles rightsand responsibilities in the Company by specifying them in their appointment letter alongwith necessary documents reports and internal policies to enable them to familiarize withthe Company's procedures and practices. The Company has through presentations atregular intervals familiarized and updated the Independent Directors with the strategyoperations and functions of the Company and Engineering Industry as a Whole. Site visitsto various plant locations are organized for the Directors to enable them to understandthe operations of the Company. The details of such familiarization programmes forIndependent Directors is posted on the website of the Company and can be accessed athttp:// www.aiaengineering.com/finances/corporate governance.php

(g) Remuneration Policy:

The Board has on the recommendation of the Nomination &Remuneration Committee framed a policy for selection and appointment of Directors SeniorManagement Personnel and their remuneration. The Remuneration Policy is stated in theCorporate Governance Report which is a Part of the Board's Report.

(h) Directors' Responsibility Statement:

To the best of their knowledge and belief and according to theinformation and explanations obtained by them your Directors make the followingstatements in terms of Clause (c) of Sub-Section (3) of Section 134 of the Companies Act2013 which states that— (a) in the preparation of the Annual Accounts theapplicable Accounting Standards for appointmenthave been followed along with properexplanation relating to material departures;

(b) the Directors have selected such accounting policies and appliedthem consistently and made judgments and estimates that are reasonable and prudent so asto give a true and fair view of the state of affairs of the Company at the end of thefinancial year and of the profit of the Company for that period; (c) the Directors havetaken proper and sufficient care for the maintenance of adequate accounting records inaccordance with the provisions of this Act for safeguarding the assets of the Company andfor preventing and detecting fraud and other irregularities;

(d) the Directors have prepared the Annual

Accounts on a going concern basis; (e) the Directors have laid downInternal Financial

Controls to be followed by the Company and that such Internal FinancialControls are adequate and were operating effectively; and

(f) the Directors have devised proper systems to ensure compliance withthe provisions of all applicable laws and that such systems were adequate and operatingeffectively.

17. AUDITORS:

Statutory Auditors:

M/s. Talati & Talati Chartered Accountants the Statutory Auditorsof the Company will retire at the ensuing 27th

Annual General Meeting of the shareholders of the Company. As perSection 139 of the Companies Act 2013 and Rules made thereunder they will not beeligible to be reappointed as Statutory Auditor of the Company in the ensuing AnnualGeneral Meeting for Financial Year

2017-18 and onwards. The Board of Directors in its meeting held on25.05.2017 on the recommendation of Audit Committee has appointed M/s. BSR & Co. LLPas

Statutory Auditors of the Company for a period of Five

Years subject to the approval of members in the 27th Annual GeneralMeeting (AGM). If appointed in the AGM they will hold office for five years from theconclusion of the ensuing Annual General Meeting till the conclusion of the 32nd AnnualGeneral Meeting.

The Company has received a letter to the effect that their appointmentif made would be within the prescribed limit under Section 139 (1) of the Companies Act2013 andthattheyarenot the meaning of Section 141 of the said Act and Rules framedthereunder.

As required under SEBI Listing Regulations the Auditors have alsoconfirmed that they hold a valid certificate issued by the Peer Review Board of theInstitute of Chartered Accountants of India.

The Board has duly reviewed the Statutory Auditors‘

Report for the Financial Year ended 31st March 2017. There were noqualifications/observations in the Report.

Cost Auditors:

Pursuant to Section 148 of the Companies Act 2013 read with theCompanies (Cost Records and Audit) Amendment Rules 2014 the Cost Audit records maintainedby the Company are required to be audited by Cost Accountant. On the recommendations ofthe Audit Committee the Board of Directors of the Company had appointed M/s. Kiran J.Mehta & Co. Cost Accountants Ahmedabad as the Cost Auditors of the Company to carryout audit of Cost Accounting Records of the

Company for the Financial Year 2016-17.

The Cost Auditors has filled the cost audit report for the financialyear ended 31st March 2016 within stipulated time frame.

The Board of Directors on the recommendation of the Audit Committee hasappointed M/s. Kiran J. Mehta & Co. Cost Accountants Ahmedabad as the Cost Auditorsof the Company to carry out audit of cost accounting records of the Company for thefinancial year 2017-

18. As required under the Companies Act 2013 the remuneration payableto the Cost Auditors is required to be placed before the members of the Company for theirratification at the ensuing Annual General Meeting. Accordingly a resolution seekingmember's ratification of the remuneration payable to M/s. Kiran J. Mehta &

Co. Cost Accountants Ahmedabad for financial year

2017-18 is included in the Notice convening the 27th Annual GeneralMeeting.

Secretarial Auditors:

Pursuant to the provisions of Section 204 of the Companies Act 2013and the Companies (Appointment and Remuneration of Managerial Personnel) Rules 2014 theCompany has appointed Tushar M. Vora & Associates Company Secretary (ACS-3459 CPNo. 1745) Ahmedabad to conduct a Secretarial Audit of the Company's Secretarial andrelated records for the year ended 31st March 2017.

The Report on the Secretarial Audit for the year ended 31st March 2017is annexed herewith as Annexure “E” to this Board's Report. Therewere no qualifications/ observations in the report.

18. PARTICULARS OF ENERGY CONSERVATION TECHNOLOGY ABSORPTION ANDFOREIGN EXCHANGE

EARNINGS AND OUTGO:

The additional information regarding conservation of energytechnology absorption and foreign exchange earnings and outgo stipulated under Section134 (3) (m) of the Companies Act 2013 read with Rule 8 of the Companies (Accounts) Rules2014 is annexed herewith to this report.

19. CONSOLIDATED FINANCIAL STATEMENTS: The Consolidated FinancialStatements of the Company prepared in accordance with Indian Accounting Standards (Ind AS)110 issued by the Ministry of Corporate Affairs form part of this Annual Report.

20. EXTRACT OF ANNUAL RETURN:

The details forming part of the extract of the Annual Returnin form MGT-9 is annexed herewith as

Annexure “F”.

21. CORPORATE SOCIAL RESPONSIBILITY (CSR):

As per the provisions of Section 135 of the Companies Act 2013 andRules made thereunder the amount required to be spent on CSR activities during the yearunder review is Rs 969.08 Lacs and the Company has spent Rs 618.63 Lacs during theFinancial Year ended

31st March 2017. The shortfall in the spending during the year underreport is intended to be utilized in a phased manner in future upon identification ofsuitable projects within the Company's CSR Policy. The requisite details of CSRactivities pursuant to Section 135 of the Companies Act 2013 and as per Annexure attachedto the Companies (Corporate Social Responsibility Policy) Rules 2014 is annexed as Annexure“G”.

The composition and other details of the CSR Committee is included inthe Corporate Governance Report which forms part of Board's Report.

22. PARTICULAURS OF EMPLOYEES:

The information required pursuant to Section 197 of Companies Act 2013read with Rule 5 of the Companies (Appointment & Remuneration of Managerial Personnel)Rules 2014 in respect of employees of the Company is annexed as Annexure “H”.

23. ENVIRONMENT HEALTH AND SAFETY:

The Company is committed to health and safety of its employeescontractors and visitors. We are compliant with all EHS Regulations stipulated under theWater (Prevention and Control of Pollution) Act The Air (Prevention and Control ofPollution) Act The

Environment Protection Act and The Factories Act and

Rules made thereunder. Our mandate is to go beyond compliance standardsand we have made a considerable improvement in this direction.

24. ACKNOWLEDGEMENT:

Your Directors would like to express their appreciation for theassistance and co-operation received from the Company's customers vendors bankersauditors investors and government bodies during the year under review. Your Directorsplace on record their appreciation of the contributions made by employees at all levels.Your Company's consistent growth was made possible by their hard work solidarityco-operation and support.

For and on behalf of the Board
Place : Ahmedabad Rajendra S. Shah
Date : 25th May 2017 Chairman
(DIN:00061922)