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Bhagwandas Metals Ltd.

BSE: 530095 Sector: Metals & Mining
NSE: N.A. ISIN Code: INE656B01019
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VOLUME 1900
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P/E 30.92
Mkt Cap.(Rs cr) 4
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OPEN 11.13
CLOSE 10.60
VOLUME 1900
52-Week high 11.13
52-Week low 5.73
P/E 30.92
Mkt Cap.(Rs cr) 4
Buy Price 11.13
Buy Qty 8100.00
Sell Price 0.00
Sell Qty 0.00

Bhagwandas Metals Ltd. (BHAGWANDASMETAL) - Director Report

Company director report

Dear Shareholders

Your Directors have pleasure in presenting the 34th Annual Report of Bhagwandas MetalsLimited along with the audited financial statements for the year ended March 31 2016.

FINANCIAL HIGHLIGHTS

(Rs.) (Rs.)
2015 - 2016 2014 - 2015
PARTICULARS Audited financial Statement for the year ended31.03.2016 Audited financial Statement for the year Ended 31.03.2015
1 Sales 220932531 461950933
2 Profit before interest Depreciation Extraordinary items and Tax 2783752 6680482
3 Interest 1222783 3981487
4 Depreciation 215639 354627
5 Profit before Extraordinary items and Tax 1345330 2344368
6 Provision for taxation` & Deferred Tax 416000 750000
7 Profit after Extraordinary item and Tax 929330 1594368

PERFORMANCE AND STATE OF AFFAIRS OF THE COMPANY.

During the year 2015-2016 the Company has earned a net profit after tax of Rs.9.29lakhs as against Rs.15.94 lakhs earned in the previous year. On the sales front theCompany has achieved a turnover of about Rs.2209 lakhs during the year 2015-2016 asagainst Rs.4620 lakhs achieved in 2014-2015.

During the year 2015-2016 the prices of Steel products was less compared to theprevious year and the demand for the steel products was very less during the year2015-2016 as compared to the previous year in Tamilnadu/Chennai where the company mainlyoperates. The real estate sector and the infrastructure sector in Chennai was very dullduring the financial year 2015-2016 which led to severe reduction in turnover during theyear compared to the previous year. Further the Company had to be very selective inextending credit terms as the realisibility itself is doubtful because of tight moneysituation in the construction sector. All these factors lead to drastic reduction inturnover and corresponding reduction in profit. The company was able to earn this profitmainly because of cost cutting in the expenses it was able to effect in view of thereduction in turnover.

During the year under review there is no change in the nature of activity of thecompany.

DIVIDEND :

In order to conserve resources the board of directors have decided not to declare anydividend for the current financial year 2015-2016

TRANSFER OF UNCLAIMED DIVIDEND TO INVESTOR EDUCATION AND PROTECTION FUND :

No amount has been transferred to the Investor Education and Protection Fund for theyear under review.

TRANSFER OF PROFIT TO RESERVES

Your company has not proposed to transfer the profits to reserves and surplus accountduring the financial year 2015-2016

MATERIAL CHANGE AND COMMITMENTS OF THE COMPANY

There are no material changes and commitments affecting the financial position of thecompany which have occurred between the end of the financial year of the company to whichthe financial statements relate and the date of the report; and there are no significantand material orders passed by the regulators or courts or tribunals impacting the goingconcern status and company’s operations in future.

PARTICULARS OF LOANS GUARANTEES OR INVESTMENTS

There have been no loan guarantees and investment given or made by the Company underSection 186 of the Act during the financial year 2015 – 2016.

SUBSIDIARIES ASSOCIATES AND JOINT VENTURE COMPANIES

The company doesn’t have any subsidiaries associates and joint venture companies.

TECHNOLOGY ABSORPTION AND FOREIGN EXCHANGE EARNINGS AND OUTGO

The information as required to be disclosed on conservation of energy technologyabsorption and foreign exchange earnings and outgo stipulated under Section 134(3)(m) ofthe Companies Act 2013 read with Rule 8 of the Companies (Accounts) Rules 2014 isannexed herewith as "Annexure I" to this Report.

DIRECTORS AND KEY MANAGERIAL PERSONNEL

In terms of Section 152 of the Companies Act 2013 Mr.Govind Prasad who retires byrotation at the forthcoming AGM and is eligible for re-appointment. Mr. Govind Prasadoffered himself for re-appointment. Brief profile is mentioned in the Notice offorthcoming Annual General Meeting of the company.

Mr. Nand Kishore Sonthalia has been re-appointed as the Managing Director and Mr.Govind Prasad has been re-appointed as the Executive Chairman of the Company for a periodof 5 years with effect from 01.01.2016 during the year The Board Recommend the Resolutionin item no. 4 and 5 relating to their respective appointment for the approval of theshareholders at the ensuing AGM.

INDEPENDENT DIRECTORS’ DECLARATION

All independent Directors have given declarations that they meet the criteria ofindependence as laid down under Section 149 of the Companies Act 2013 which has beenrelied on by the Company and placed at the Board Meeting of the Company.

DISCLOSURE WITH RESPECT TO DEMAT SUSPENSE ACCOUNT/ UNCLAIMED SUSPENSE ACCOUNT

The Company is not required to give a disclosure with respect to demat suspenseaccount/ unclaimed suspense account.

AUDITORS

STATUTORY AUDITORS

Pursuant to the provisions of section 139 of the Act and the rules framed there underM/s. R.R.More & CoChartered Accountants (firm registration no. 02133S) wereappointed auditors of the company from the conclusion of the 32nd Annual General Meeting(AGM) of the company held on 18th September2014 till the conclusion of 35th AGM subjectto ratification of their appointment at every AGM and their appointment has to be ratifiedat the ensuing Annual General Meeting. The Board recommends their ratification in theensuing Annual General Meeting.

COMMENT ON STATUTORY AUDITOR REPORT

There are no qualifications reservations remarks or disclaimers made by R.R.More& Co Statutory auditor in their auditor report .The statutory auditor have notreported any incident of fraud to the Audit Committee of the Company during the financialyear 2015-2016.

SECRETARIAL AUDITOR

Pursuant to the requirements of Section 204 (1) of the companies Act 2013 and Rule 9 ofCompanies (Appointment and Remuneration of Managerial Personnel) Rules 2014 the Companyhas appointed M/s Lakshmmi Subramanian & Associates a firm of Company Secretaries inPractice to undertake Secretarial Audit of the Company for the financial year 2015-2016.

The Secretarial Audit report as received from the secretarial auditor is annexed tothis report as Annexure II.

COMMENT ON SECRETARIAL AUDITOR REPORT

With reference to the remarks made by the secretarial auditor in the Secretarial AuditReport the company has taken the corrective measures during the current financial year.

INTERNAL CONTROL AND ITS ADEQUACY

Mr. A. Karikalan & Co. Chartered Accountant was appointed as internal auditors ofthe Company. They regularly conduct audit and submit their quarterly reports which arereviewed by the Audit Committee. The Company has an adequate Internal Control systemcommensurate with the size scale and complexity of its operations. To maintain itsobjectivity and independence the Internal Auditor reports to the Chairman of the AuditCommittee of the Board. During the year such controls were tested and no reportablematerial weaknesses in the design or operation were observed.

RELATED PARTY TRANSACTIONS

The particulars of contracts or arrangements with related parties referred to section188 of the Companies Act 2013 as prescribed in the form Aoc-2 is annexed as Annexure–III to this report.

EXTRACT OF ANNUAL RETURN

The details forming part of extract of Annual Return in form MGT -9 as provided underSub Section (3) of the Section 92 of the Companies Act2013 (the "Act") isannexed herewith as Annexure –IV to this report.

PERSONNEL

The information required under Section 197(12) of the Companies Act 2013 read withrule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules2014 in respect of employees of the Company forms part of this Report as Annexure V.

RISK MANAGEMENT POLICY

The risk management is overseen by the Audit committee of the company in a continuousbasis. Major risks if any identified by the business and functions are systematicallyaddressed through mitigating action on a continuous basis. The Risk Management policy isavailable in the Company website www.metal-bml.com

DISCLOSURE AS PER SEXUAL HARRASMENT OF WOMEN AT WORKPLACE (PERVEVTION PROHIBITION ANDREDRESSAL) ACT 2013

Presently the total numbers of employees are less than the statutory limit and hencethe company has not constituted a separate committee under the Sexual Harassment of Womenat Workplace (Prevention Prohibition and Redressal) Act 2013. However the company haszero tolerance for sexual harassment at workplace.

During the financial year 2015-2016 the Company has not received any sexual harassmentcomplaints.

MANAGEMENT DISCUSSION AND ANALYSIS REPORT

OVER VIEW

The following operating and financial review is intended to convey themanagement’s perspective on the financial condition and on the operating performanceof the company as at the end of the Financial Year 2015-16. The Company’s financialstatements have been prepared in compliance with the requirements of the companies Act2013 guidelines issued by the Securities and Exchange Board of India (SEBI) and theGenerally Accepted Accounting Principles (GAAP) in India.

GLOBAL STEEL INDUSTRY

The outlook for the global economy is mostly positive with growth picking up in the USIndia and Southeast Asia while several emerging markets are experiencing a decelerationin growth. However the structural shift in the transitioning Chinese economy could capthis momentum. Countries and businesses are becoming increasingly interdependent throughtrade investment and financial systems across the world. The risks and opportunities inthe steel business are getting larger in scale and impact with their sources becomingmore diverse and global.

STEEL INDUSTRY IN INDIA

India’s crude steel production grew by 4.9 per cent year-on-year to at 8 MillionTonnes (MT) in May 2016.Total steel production in the country is expected to increase by 7per cent in 2016.During 2015-16 hot metal production increased at a rate of 1.3 per centyear-on-year to 57.13 MT whereas the production for sale of total finished steel stood at90.39 MT. India’s consumption of total finished steel increased by 4.5 per cent to80.45 MT during 2015-16. Total finished steel exports during FY 2015-16 stood at 4.08 MTwhereas total finished steel imports stood at 11.71 MT for the same period. India’scrude steel capacity has increased 7.6 per cent to 118.2 MT. The steel sector in Indiacontributes nearly two per cent of the country’s Gross Domestic Product (GDP) andemploys over 600000 people. The per capita consumption of total finished steel in thecountry has risen from 51 Kg in 2009-10 to about 61.9 Kg in 2015-16 (source www.ibef.org).

SEGMENT-WISE PERFORMANCE

During the year 2015-16 the prices of Steel products was less compared to the previousyear and the demand for the steel products was very less during the year 2015-16 ascompared to the previous year in Tamilnadu/Chennai where the company mainly operates. Thereal estate sector and the infrastructure sector in Chennai was very dull during thefinancial year 2015-16 which led to severe reduction in turnover during the year comparedto the previous year. Further the Company had to be very selective in extending creditterms as the realisibility itself is doubtful because of tight money situation in theconstruction sector. All these factors lead to drastic reduction in turnover andcorresponding reduction in profit. The company was able to earn this profit mainly becauseof cost cutting in the expenses it has able to effect in view of the reduction inturnover.

OUTLOOK

In Financial Year 2015-16 while greater financial stability is expected in theadvanced economics growth will remain subdued in emerging and developing economies.Financial Year 2015-16 has been a challenging year with subdued economic growth as aresult of higher inflation higher interest rates lower industrial growth and lowerinvestments in the country alongwith the poor condition of the global economy. Howeverthe Indian economy is expected to perform comparatively well in the coming years. With astable government at the centre significant policy changes are anticipated in the nearfuture.

RISKS CONCERNS OPPORTUNITIES AND THREATS

While the steel consumption growth in India has been relatively resilient slowingeconomic growth has meant a moderation in steel consumption growth rates. Despite thechallenging economic conditions/ increase in the cost of goods sold the Company isconfident of increasing the turnover and profitability in the years to come.

INTERNAL CONTROL SYSTEM AND ADEQUACY

The Company has in place adequate internal control systems and procedures commensuratewith the size and nature of business. These procedures are designed to ensure. i) That allassets and resources are used efficiently and are adequately protected. ii) That all theinternal policies and statutory guidelines are complied with. iii) The accuracy and timingof financial reports and management information.

DISCUSSION ON FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE

The turnover of the Company for the year was Rs. 220932531 as against the previousyear’s turnover of Rs. 461950933. Similarly there has also been a decline in theprofit earned from Rs. 1594368 in 2014-15 to Rs. 929330 in 2015-16. It has beenobserved that the decrease in the turnover as well as the profits has been due to stiffcompetition and increase in the cost of goods sold. Subsequently this has also had aneffect on the tonnage sales of the Company which has also reduced comparatively.

HUMAN RESOURCES

Your Company considers its employees as one the key stakeholders. It has created aHuman Resources environment which fasters speed and agility in responding to the changingenvironment learning and innovation to survive and prosper and integrity in alloperation.

STATUTORY COMPLIANCE

The Managing Director makes a declaration at each Board Meeting regarding thecompliance with provisions of various statutes after obtaining confirmation from all theunits of the company. The Company ensures compliance with the SEBI regulations andprovisions of the Listing Agreement. The Compliance Officer ensures compliance with theguidelines on the insider trading for prevention of insider trading.

CAUTIONARY STATEMENT

Statements made in this report describing the Company’s objectives projectionsestimates expectations may be "forward looking statements" within the meaningof applicable securities laws and regulations. Actual results could differ materially fromthis expressed or implied. Important factors that could make a difference to theCompany’s operations include economic conditions affecting demand/supply and priceconditions in the domestic and overseas markets in which the Company operates changes inthe Government regulations tax laws and other statutes and incidential factors.

DISCLOSURE OF ACCOUNTING TREATMENT

During the preparation of the financial statements the treatment followed was as perthe Accounting Standards and no deviation took place.

DEPOSITS FROM PUBLIC

The Company has not accepted any deposits from public and as such no amount on accountof principal or interest on deposits from public was outstanding as on date of the balancesheet.

CORPORATE GOVERNANCE REPORT

Since your company’s paid up Equity capital and Networth is less than Rs.10 croresand Rs.25 crores respectively the provisions of revised Clause 49 relating to CorporateGovernance vide SEBI circular number CIR/CFD/POLICY CELL/7/2014 dated 15th September2014 is not applicable to the company.

NUMBER OF MEETINGS OF THE BOARD

In total 4(four) Meetings of the Board of Directors of the Company were held during theyear 2015-2016held on 29th May 2015 7th& 8th August 2015 12th November 2015 and12thFebruary 2016. The maximum time gap between any two consecutive meetings did notexceed 120 days.

PERFORMANCE EVALUATION OF BOARD COMMITTEE AND DIRECTORS

Pursuant to the provisions of the Companies Act 2013 the Board has carried out anannual performance evaluation of its own performance the directors individually as wellas the evaluation of the working of the Audit and Nomination & Remuneration Committeesand the same was based on questionnaire and feedback from all the Directors on the Boardas a whole Committees and self-evaluation. A structured questionnaire was prepared aftertaking into consideration of the inputs received from the Directors covering variousaspects of the Board’s functioning such as adequacy of the composition of the Boardand its Committees Board culture execution and performance of specific dutiesobligations and governance. A separate exercise was carried out to evaluate theperformance of individual Directors including the Chairman of the Board who wereevaluated on parameters such as level of engagement and contribution independence ofjudgement safeguarding the interests of the Company and its minority shareholders etc.

The performance evaluation of the Independent Directors was carried out by the entireBoard. The performance evaluation of the Chairman of the Board and the Executive Directorswas carried out by the Independent Directors.

CODE OF CONDUCT FOR DIRECTORS AND SENIOR MANAGEMENT

The Board of Directors had adopted a Code of Conduct for the Board Members andemployees of the company. This Code helps the Company to maintain the Standard of BusinessEthics and ensure compliance with the legal requirements of the Company.

The Code is aimed at preventing any wrong doing and promoting ethical conduct at theBoard and employees. The Compliance Officer is responsible to ensure adherence to the Codeby all concerned.

The Code lays down the standard of conduct which is expected to be followed by theDirectors and the designated employees in their business dealings and in particular onmatters relating to integrity in the work place in business practices and in dealing withstakeholders.

All the Board Members and the Senior Management personnel have confirmed compliancewith the Code.

The policy is available in the Company website www.metal-bml.com

WHISTLE BLOWER POLICY/VIGIL MECHANISM

The company has framed a whistle blower policy. Further Directors and employees arehaving full access to the audit committee to report their genuine and serious concern ifthey observe any. The policy is available in the Company website www.metal-bml.com

POLICY OF DIRECTORS’ APPOINTMENT AND REMUNARATION

Directors’ appointment and remuneration including criteria for determiningqualifications positive attributes independence of a director and other matters providedunder section 178 of the Act are covered under the Board’s policy formulated by theCompany and is available on the Company website www.metal-bml.com

BOARD COMPOSITION

The Board is well constituted with composition of two executive four Non- executiveout of which three are Independent Directors.

Name of Member Category Meetings held during FY 2015 - 2016 Meetings attended
Mr.Govind Prasad Executive Director 4 4
Mr.Nand Kishore Sonthalia Executive Director 4 3
Mrs.Gita Agarwal Non-Executive Director 4 4
Mr.Chidambaram Chettiar Ramasamy Independent 4 4
Mr.Nirmal Anraj Gadhiya Independent 4 4
Mr. Narendra Kumar Lunawath Independent 4 4

Board Committees

The Board has constituted the following committees viz. Audit Committee Nomination andRemuneration Committee and Stakeholders’ Relationship Committee.

Audit Committee

(A) Qualified and Independent Audit Committee

The Company complies with Section 177 of the Companies Act 2013 the Audit Committee.Its functioning is as under:

(i) The Audit Committee presently consists of three Independent Directors.

(ii) All members of the Committee are financially literate and having the requisitefinancial management expertise;

(iii) The Chairman of the Audit Committee is an Independent Director;

(iv) The Chairman of the Audit Committee was present at the last Annual General Meetingheld on 29th September 2015.

(B) Terms

The terms of reference of the Audit Committee include :

• the recommendation for appointment remuneration and terms of appointment ofauditors of the company;

• review and monitor the auditor’s independence and performance andeffectiveness of audit process;

• examination of the financial statement and the auditors’ report thereon;

• approval or any subsequent modification of transactions of the company withrelated parties;

• scrutiny of inter-corporate loans and investments

• valuation of undertakings or assets of the company wherever it is necessary;

• evaluation of internal financial controls and risk management systems;

• Monitoring the end use of funds raised through public offers and related matters

Powers of Audit Committee:

The Audit committee shall have the authority –

• To call for the comments of the auditors about internal control systems thescope of audit including the observations of the auditors and review of financialstatement before their submission to the Board.

• To discuss any related issues with the internal and statutory auditors and themanagement of the company

• To investigate into any matter in relation to the items or referred to it by theBoard

• To obtain professional advice from external sources

• To have full access to information contained in the records of the company.

(C) Composition names of Members and Chairperson its meetings and attendance :

The composition of the Committee consists of Mr. Chidambaram Chettiar RamasamyChettiar an independent Director its Chairman Mr. Nirmal Anraj Gadhiya Mr.NarendraKumar Lunawath are as members of the committee. During the year 4 Audit Committeemeetings were held on 29th May 2015 7th & 8th August 2015 12th November 2015 and12th February 2016

The composition of the Audit Committee and number of meetings attended by the Membersduring the year are given below:

Name of Member Category Meetings held during FY 2015 - 2016 Meetings attended
Mr.Chidambaram Chettiar Ramasamy Independent / Chairman Independent 4 4
Mr.NirmalAnraj Gadhiya Director

4

4

Mr. Narendra Kumar Lunawath Independent Director 4 4

The Committee meetings were attended by invitation by the representatives of InternalAuditors.

Nomination and Remuneration Committee

(A) Constitution

The committee consists of Mr.Chidambaram Chettiar Ramasamy Chettiar an independentDirector its Chairman Mr.Nirmal Anraj Gadhiya Mr. Narendra Kumar Lunawath are asmembers of the committee. During the year one meeting of the Nomination and RemunerationCommittee was held on 12.11.2015.

(B) Terms of reference

Terms of reference of the Nomination and Remuneration Committee include:

• The Committee shall formulate the criteria for determining the qualificationpositive attributes and independence of a director and recommend to the Board a policyrelating to the remuneration for the directors key managerial personnel and otheremployees.

• The Committee shall identify persons who are qualified to become directors andwho may be appointed in senior management positions in accordance with the criteria laiddown recommend to the Board their appointment and removal and shall carry out evaluationof every director’s performance.

• The Committee shall ensure that level and composition of remuneration isreasonable and sufficient relationship of remuneration to performance is clear and meetsPerformance benchmarks and involves a balance between fixed and incentive pay.

• Review the policy from time to time for selection and appointment of Directorsand senior management employees and their remuneration;

• Review the performance of the Board of Directors and Senior Management Employeesbased on certain criteria as approved by the Board. In reviewing the overall remunerationof the Board of Directors and Senior Management the Committee ensures that theremuneration is reasonable and sufficient to attract retain and motivate the bestmanagerial talent the relationship of remuneration to performance is clear and meetsappropriate performance benchmarks and that the remuneration involves a balance betweenfixed and incentive pay reflecting short term and long term objectives of the Company.

• Filling up of vacancies in the Board that might occur from time to time andappointment of additional Non-Executive Directors. In making these recommendations theCommittee shall take into account the special professional skills required for efficientdischarge of the Board’s functions.

• Recommendation to the board with regard to retirement of Directors liable toretire by rotation and appointment of Executive Directors. o To determine and recommend tothe Board from time to time

(a) The amount of commission and fees payable to the Directors within the applicableprovisions of the Companies Act 2013.

(b) The amount of remuneration including performance or achievement bonus andperquisites payable to the Executive Directors

(c) To frame guidelines for Reward Management and recommend suitable schemes for theExecutive Directors and Senior Management

• To determine the need for key man insurance for any of the company’spersonnel o To carry out the evaluation of every director’s performance

• To carry out any function as is mandated by the Board from time to time and /orenforced by any statutory notification amendment or modifications as may be applicable.

• Stakeholders’ Relationship Committee

(C) Meetings and attendance during the year :

Name of Member Category Meetings held during FY 2015-2016 Meetings attended
Mr.Chidambaram ChettiarRamasamy Independent / Chairman 1 1
Mr.NirmalAnraj Gadhiya Independent 1 1
Mr.Narendra Kumar Lunawath Independent 1 1

(D) Remuneration policy

The Board has on the recommendation of the Nomination & Remuneration Committeeapproved a policy for selection and appointment of Directors Senior Management and fordetermining their remuneration. Remuneration Policy of the Company is available in thecompany website www.metal-bml.com

(c)Details of Remuneration to Directors

Name of the Directors Salary & perquisites Sitting Fees No of shares held as on 31.03.2016 Relatioship with Directors
Mr.Govind Prasad 1500000 - 646000 Father of Mr.Nand Kishore Sonthalia
Mr.Nand Kishore Sonthalia 1200000 - 427883 Son of Mr.Govind Prasad
Mr.C.Ramasamy Chettiar - 10500 200 -
Mr.Narendra Kumar Lunawath - 7500 - -
Mr.Nirmal Anraj Gadhiya - 7500 -
-
Mrs.Gita Agarwal - 6000 708234 Wife of Mr.Govind Prasad

Notes:

There has been no pecuniary relationship or transactions other than above of theNon-Executive Independent Directors vis--vis the Company during the year under review.

Stakeholders Relationship Committee

The Stakeholders Relationship Committee specifically looks into issues such asredressing of shareholders’ and investors’ complaints such as transfer ofshares non-receipt of shares non-receipt of declared dividends and ensuring expeditiousshare transfers and also redresses the grievances of deposit holders debenture holdersand other security holders.

(A) Composition Members its meetings and attendance

This Committee comprises of namely Mr.Chidambaram Chettiar Ramasamy Chettiar anindependent Director its Chairman Mr.Govind Prasad Mr.Nand Kishore Sonthalia are asmembers of the committee. During the year 6 share transfer Committee meetings were heldon 05.08.2015 02.11.2015 12.11.2015 12.01.2016 17.02.2016 03.03.2016.

The composition of the Stakeholders Relationship Committee and number of meetingsattended by the Members during the year are given below:

Name of Member Category Meetings held during FY 2015-2016 Meetings attended
Mr.Chidambaram Chettiar Ramasamy Independent / Chairman 6 6
Mr.Govind Prasad Member 6 5
Mr.Nand Kishore Sonthalia Member 6 4

CORPORATE SOCIAL RESPONSIBILITY (CSR):

Your company is not mandatorily required to constitute CSR committee since it has notcome within the purview of threshold limit specified in section 135 of the Companies Act2013.

DIRECTORS’ RESPONSIBILITY STATEMENT

Pursuant to the requirement of Section 134 (5) of the Act the Directors herebyconfirm:

1. That in the Preparation of Final Accounts the applicable Accounting Standards hadbeen followed along with proper explanation relating to material departures;

2. That they had selected such Accounting Policies and applied them consistently andmade judgments and estimates that are reasonable and prudent so as to give a true and fairview of the state of affairs of the Company at the end of the Financial Year and of theProfit or Loss of the Company for that period;

3. That they had taken proper and sufficient care for the maintenance of adequateAccounting Records in accordance with the provisions of the Act for safeguarding theAssets of the Company and for preventing and detecting fraud and other irregularities;

4. That they had prepared the Annual Accounts on a Going Concern basis.

5. That they laid down internal financial controls to be followed by the company andthat such internal financial controls are adequate and operating properly; and

6. That they have devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.

ACKNOWLEDGEMENT

Your Directors wish to place on record their appreciation of the contributions made byemployees at all levels towards the continued growth and prosperity of your Company.Directors take this opportunity to convey their thanks to all the valued shareholders andthe valuable services rendered by the Officers and Staffs at all levels.

For and on behalf of the Board
Chairman
Place: Chennai Govind Prasad
Date: 01.08.2016 DIN-00017460