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Binani Industries Ltd.

BSE: 500059 Sector: Others
NSE: BINANIIND ISIN Code: INE071A01013
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VOLUME 27835
52-Week high 120.90
52-Week low 50.00
P/E 10.50
Mkt Cap.(Rs cr) 228.22
Buy Price 72.75
Buy Qty 480.00
Sell Price 0.00
Sell Qty 0.00
OPEN 73.70
CLOSE 72.80
VOLUME 27835
52-Week high 120.90
52-Week low 50.00
P/E 10.50
Mkt Cap.(Rs cr) 228.22
Buy Price 72.75
Buy Qty 480.00
Sell Price 0.00
Sell Qty 0.00

Binani Industries Ltd. (BINANIIND) - Director Report

Company director report

Dear Members

Your Directors present the Fifty Third Annual Report of the Company together with theAudited Financial Statements for the Financial Year ended 31st March 2016

1. FINANCIAL HIGHLIGHTS

(Rs in Lacs)

Particulars 31st March 2016 31st March 2015
Total Income 52513.62 5514.21
Finance Costs 4620.81 18459.17
Depreciation & Amortisation 265.96 177.25
Transfer from Business Reorganisation Reserve (8841.05) (19802.74)
Profit/lLoss) before Tax & Exceptional items 1647.68 1204.79
Less: Tax expense (current tax and tax on earlier years) (21.20)
Less: Deferred tax Asset 34.43 -
Profit after Tax 1634.45 1204.79
Transfer to General Reserve - (121.00)
Reversal of undeclared dividend and Dividend Distribution tax of 2014-15 1068.65
Proposed Dividend Nil (887.90)
Dividend distribution Tax Nil (180.75)
*brought forward from last year 1922.52 (1988.65)
Transferred from General Reserve - 121.00
Proft/(Loss) carried to balance sheet 1922.52 (1872.33)

*Inc1udes Rs1091.75 Addition during the period pursuant to Scheme of Amalgamation

2. REVIEW OF OPERATIONS

Your Company is engaged in the business of providing logistics solutions mediapublication services trading in shares and securities and trading and export of goods andmanagement support services and has also sub-licensed to its major subsidiaries for use ofits Intellectual Property Rights such as Brand Logo & Trade Mark etc. The Board ofDirectors of the Company ("Board") has not charged any fees for managementsupport services and royalty to all its subsidiaries during the current year.

For the year under review your Company earned a Total Income of Rs 52514 Lacs asagainst Rs 5514 Lacs in the previous year. The

Total Income for the year 2015-16 was significantly higher on account of Amalgamationof Binani Metals Limited with the Company effective April 012015 (Appointed Date). Thisresulted in the Company earning Profit after Tax of Rs 1634 Lacs as against Rs 1205 Lacsin the previous year after transfer of sum of Rs 8841 Lacs from Business Re-organizationReserve as against Rs 19803 Lacs last year.

3. DIVIDEND

Considering the present financial position of the Company the Board of Directors donot recommend dividend for the financial year 2015-16.

4. RESERVES

No amount is proposed to be transferred to Reserves.

5. SHARE CAPITAL

During the financial year under review there have been no changes in the AuthorizedIssued Subscribed and Paid-up Share Capital of the Company.

6. SCHEME OF AMALGAMATION

Pursuant to the approval of Scheme of Amalgamation of Binani Metals Limited (BML) withthe Company by the HonRsble High Court of Judicature at Kolkata vide its order dated 21stJanuary 2016 the Scheme became effective on 5th April 2016.

The Board of Directors at its meeting held on 21st April 2016 approved issue of :-

- 1771600 Equity Shares of Rs 10/- each to the eligible shareholders of BML as on22nd April 2016 the record date fixed for the said purpose

- 298000 0.01% Non-cumulative Redeemable Preference Shares of Rs 100/- each toPreference Share holders of BML

The Board at its above-mentioned meeting constituted Share Allotment Committee for thepurpose of allotment of Equity and Preference Shares to Shareholders of BML.

Consequent upon allotment of following shares by the Allotment Committee at its meetingheld on 29th April 2016 the Authorised Issued Subscribed and Paid-up Capital of theCompany stands increased as below:-

1 Authorized Share Capital
44000000 Equity Shares of ` 10/- each
12400000 Preference Shares of ` 100/- each
2 Issued Share Capital
31368025 Equity Shares of ` 10/- each
12298000 Preference Shares of ` 100/- each
3 Subscribed and Paid up Capital
31366175 Equity Shares of ` 10/- each
12298000 Preference Shares of ` 100/- each

7. CONSOLIDATED FINANCIAL STATEMENTS

In accordance with the provisions of sub-section (3) of section 129 of the CompaniesAct 2013 and the SEBI Listing Obligation Disclosure Requirments) Regulations 2015 theConsolidated Audited Financial Statements of the Company including the

financial details of all the subsidiary companies of the Company forms part of thisAnnual Report. The Consolidated Financial Statements have been prepared in accordance withapplicable Accounting Standards prescribed under Section 133 of the Companies Act 2013.

8. DIRECTORSRs RESPONSIBILITY STATEMENT

Pursuant to the provisions of clause of sub-section (3) and subsection (5) section 134of the Companies Act 2013 (Rsthe ActRs) your Board of Directors state and confirm that:-

a. In the preparation of the annual financial statements for the year ended March 312016 the applicable Accounting Standards read with requirements set out under ScheduleIII to the Act have been followed and proper explanation relating to material departuresif any has been furnished;

b. they have selected such accounting policies as listed in the Note 2 to the FinancialStatements and have applied them consistently and prudent judgments & estimates thatare reasonable and prudent have been made so as to give a true and fair view of the stateof affairs of the Company as at 31st March 2016 and of the profits of the Company for thefinancial year ended on that date;

c. they have taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of Rsthe ActRs for safeguarding theassets of the Company and for preventing and detecting fraud and other irregularities;

d. they have prepared the annual accounts for the financial year ended on March 312016on a going concern basis.

e. they have laid down internal financial controls to be followed by the Company andthat such internal financial controls are adequate and were operating effectively and

f. they have devised proper systems to ensure compliance with the provisions of allapplicable laws and that such systems were adequate and operating effectively.

9. MATERIAL CHANGES AND COMMITMENTS AFFECTING THE FINANCIAL POSITION OF THE COMPANY

1. Edayar Zinc Limited (EZL) subsidiary of the Company was referred to Board forIndustrial and Financial Reconstruction (BIFR) for determination of sickness. During theyear under review the matter pending before BIFR for determination of sickness of theCompany could not see much progress due to intermittent sitting of BIFR. EZL has alreadyapplied to BIFR seeking inter alia urgent listing of the main case and declaration ofthe Company as a sick company under Section 22(1) of the Sick Industrial Companies(Special Provisions) Act 1985 (SICA) and appoint an operating agency for formulation ofdraft rehabilitation scheme.

Since the plant was not operational for sanction of suitable revival and rehabilitationpackage for a considerable length of time and there was no possibility of resumption ofoperation in the immediate future the Company retrenched its management staff during June2015 and applied to State Government of Kerala for closure of plant to facilitate revivalof business. EZL has moved for adjudication.

During the third quarter of the year under review the Secured Creditors initiated theaction under Section 13(4) of The Securitization and Reconstruction of Financial Assetsand Enforcement of Security Interest Act 2002 (SARFAESI Act 2002) for recovery of theirdues and has issued notice of taking symbolic possession. EZL is in the process of makingan application to the Debt Recovery Tribunal seeking inter alia to set aside the noticeunder section 13(4) of SARFAESI Act 2002. EZL has also challenged the notice receivedfrom the banks for declaration of the Company as a willful defaulter.

EZL is hopeful that Creditors and Authorities will take measured stand to safeguardinterest of all stakeholders by allowing EZL to revive under a suitable revival package.

2. Your subsidiary B T Composites Limited is in the process of voluntary liquidationand has appointed Mrs. Sara Sancheti a Company Secretary in Whole Time Practice as theliquidator of the Company. The procedure for voluntary liquidation is underway.

10. PARTICULARS OF LOANS GIVEN INVESTMENTS MADE GUARANTEES GIVEN AND SECURITIESPROVIDED

During the year under review the loans given investments made and Guarantees givenand securities provided under Section 186 of the Companies Act 2013 are given in the Notesto the Standalone Financial Statements.

11. CONTRACTS OR ARRANGMENTS WITH RELATED PARTIES

All transactions entered into by the Company with related parties were in the ordinarycourse of business and at arm's length. The Audit Committee from time to time reviewed andapproved the said transactions. Disclosures as required under AS- 18 have been made inNotes to the Financial Statements.

The Company has not entered into any fresh material contracts with any of the relatedparties during the year under review. The details of existing Related PartyContracts/Arrangements modified during 2015-16 are provided as Annexure A to thisreport in Form AOC-2

12. DEPOSIT

The Company has not accepted any deposit from the public within the meaning ofsub-section (31) of section 2 and Section 73 of the Companies Act 2013 and Rules framedthere under.

13. OUTLOOK

The year 2015-16 has been a year of mixed bag for the Group. BCL suffered set back asthe industry continued to go through a phase of poor demand scenario. The Company paidalmost the entire principal demand to the Rajasthan VAT Authorities (RVAT) in connectionwith the past dues which were in dispute. With improvements in demand the year 2016-17 isexpected to be a good year.

EZL operations were shut for the entire year and as explained above EZL is hopefulthat Creditors and Authorities will take measured stand to safeguard interest of allstakeholders by allowing EZL to revive under a suitable revival package.

The Group's Glass Fibre business both in India and abroad have shown considerableimprovement for the year under review. Improved business conditions in European Marketswith several measures undertaken to improve efficiency across different operating areasresulted in significantly improved top line as well as bottom-line.

BIL Infratech Limited another subsidiary of your Company continued to reportsignificantly improved performance though relatively smaller in volume.

14. REPORT ON SUBSIDIARY COMPANIES

In accordance with Proviso to sub-section (3) of Section 129 of the Companies Act 2013("Act") the salient features of the Financial Statements of subsidiaryCompanies are set out in the prescribed Form AOC - 1 which forms part of this Report. Thesaid Financial Statements shall also be kept for inspection by the Members at theRegistered Office of the Company. The Company will provide free of cost a copy ofFinancial Statements in respect of its subsidiaries to any Member of the Company uponreceipt of a request for the same.

FINANCIAL HIGHLIGHTS AND BUSINESS OUTLOOK OF The Company's SUBSIDIARY COMPANIES

The Financial Highlights and Business Outlook in respect of the Company's majorsubsidiaries are given below:- Binani Cement Limited (BCL)

Financial Highlights

Rs in Lacs

Particulars 2015-16 2014-15
Total Revenue 152425 183998
Profit before Depreciation Interest and Tax and Exceptional Items 8751 29347
Provision for Depreciation 6807 7471
Interest and Financial Charges 36848 35325
Profit / (Loss) before Tax and Exceptional Items (34904) (13449)
Exceptional Items - 1283
Provision for Tax (Deferred Tax) (6007) (4244)
Profit / (Loss) after Tax (28897) (10488)

Review of Operations

Demand for cement is highly correlated with cyclical activities like construction andinfrastructure development. The sluggish demand of cement continued in 2015-16 and whichhas been further affected due to Cash Flow constraints owing to coercive measuresinitiated by the Rajasthan VAT Authorities the Company could achieve production of 4.326million MT as compared to 4.501 million MT in the Financial Year 2014-15; lower by about4%.

Consequently cement sales were also lower by 13% at 4.313 million MT as against 4.473million MT in the previous year. Share of Portland Pozzolana Cement (PPC) as a percentageto total sales reduced from 43% to 37% as per market scenario. The Cement industry hasbeen passing through a difficult year. Due to sluggish demand the gross sales realisation(net of VAT/ CST & discount) of the Company has been lower to

Rs 4084/ MT as compared to Rs 4373/ MT in previous financial year. Because of thelower realisation the margins have been adversely affected.

The HonRsble High Court at Calcutta has recalled its earlier order sanctioning theScheme of Arrangement for hive-off of the BCL's Power Undertaking to its wholly ownedsubsidiary namely Binani Energy Private Limited. and permitted to withdraw the Scheme videits order dated 16th October 2015.

Business Outlook Indian Cement Industry

The cement industry in India the second-largest in the world is a study in hope. Thesector which has been facing depressed demand is hoping that business fromgovernment-driven projects will get their engines back into high gear. Currently India'scement production capacity is about 390 million tons per annum (MTPA) accounting foraround 6.7% of world's output. The cement production capacity is estimated to touch 550MTPA by the end of 2020.

The Government of India is strongly focused on infrastructure development to boosteconomic growth and is aiming for 100 smart cities. It plans to increase investment ininfrastructure to US$ 1 trillion in the 12th Five Year Plan (2012-17) and it is expectedthat the investment figure will increase significantly in next Five Year Plan. Thegovernment also intends to expand the capacity of the railways and the facilities forhandling and storage to ease the transportation of cement and reduce transportation costs.These measures would lead to increased construction activity thereby boosting cementdemand.

The lion's share of cement demand is created by the housing market which is alsofacing a depressed future. The good news it that the RBI is expected to lower interestrates in 2016 which could create increased housing demand. Further government projectsinclude the Housing for All initiative (on which it plans to spend $50 billion) and thesmart city push which would help in boosting the muted growth of the cement industry. Thecement market in India is expected to grow at a Compounded annual growth rate (CAGR) of9.7% during 2006-2017.

With the positive sentiments prevailing consequent upon a stable Government at theCentre coupled with large planned investments in infrastructure and housing /real estatesectors the demand for cement is likely to get a boost in the coming years. Opportunitiesalso exist in terms of technology innovations for improving efficiency and installation ofWaste Heat Recovery System.

BCL has strategized to focus on the nearby markets to optimize its logistic costs andstreamline and strengthen its distribution network. In addition the Company continues tostreamline the processes with a view to bring all around efficiencies which willfacilitate yielding better margin.

With Indian Economy progressing towards the growth trajectory still economy might takesome time to stabilize completely. Intense competition over capacity situation in theregions where the Company operates coupled with expansion plans of global giants andincreasing small players will pose challenge and put pressure on the price realization.

Overall BCL is hopeful of reporting better performance in the years ahead barringunforeseen circumstances.

Edayar Zinc Limited (formerly Binani Zinc Limited)

Financial Highlights

Particulars 2015-16 2014-15
Total Revenue 9.04 113.15
Profit before Depreciation Interest and (7.06) (18.28)
Tax and Exceptional Items
Provision for Depreciation 4.01 8.14
Interest and Financial Charges 36.36 25.60
Profit / (Loss) before Tax and (47.44) (52.03)
Exceptional Items
Exceptional Items - -
Provision for Tax - -
Profit / (Loss) after Tax (47.44) (52.03)
Balance carried forward (145.54) (98.10)

Review of Operations

During Financial Year 2015-16 (FY 2016) the Company did not operate its plant and thereference made to Board for Industrial and Financial Reconstruction (BIFR) in terms ofSection 15 of the Sick Industrial Companies (Special Provisions) Act 1985 (SICA) waspending as at the end of financial year for determination of its sickness.

During FY 2016 ("the year under review") total revenue was Rs9.04 lacs asagainst Rs113.15 lacs during corresponding previous FY 2015. The Company recorded negativeEBIDTA of Rs7.06 lacs in FY 2016 vis-a-vis negative EBITDA of Rs18.28 lacs last year.

3B Binani Glass Fibre S.a.r.l (3B Binani)

Financial Highlights

Particulars 2015-16 2014-15
Total Revenue 194.76 195.72
Profit/(Loss) before Depreciation Interest & Tax 39.21 26.71
Provision for Depreciation 17.88 12.67
Interest and Financial Charges 18.58 17.43
Loss before Tax (0.62) (28.81)
Provision for Tax 0.03 (00.40)
Loss after Tax (0.66) (28.41)

Review of Operations

3B Binani on a consolidated basis reported significant improvement in its operatingperformance in the year 201516. The strict implementation of the Profitability ImprovementPlan covering all key financial drivers strongly contributed to the overall performanceimprovement. Solid market conditions enabled to stabilize the sales volume at a high levelwhile recording price increases. The net loss has been reduced significantly also thanksto the impact of the unrealized foreign exchange gain (non-cash) on the IDBI debtassociated with the weakening of the dollar versus last year against the Euro.

Industry Overview

The EU reinforcement market remains solid with decent growth across all segments andacross the entire product line. The industry has been growing steadily above 5% over thelast 3 years. In 2015 imports have reduced at the beginning of the year but then resumedwith higher level later on and closed with a growing trend.

In 2016 Europe is starting with a reasonable level of shipments even if the optimismobserved in 2015 has slowly transformed into more cautious expectations. Overall the EUWind market is still developing very well even if some OEM's are doing better than others.China is also expected to be weaker due to a change in their support system. InAutomotive the number of cars produced is expected to grow by another 2% in 2016 whichis lower than 2015 but still showing a certain level of optimism. The Indian reinforcementmarket remains strong and is expected to grow by another low double digit figure in 2016.The government's push for wind energy will be the main driver for growth in the next fewyears. CSM is expected to grow by a high single digit figure in 2016 with railwaycoaches bus body and Marine industry driving the growth.

Market outlook

3B Binani will continue to focus on its core markets Automotive Wind and PerformanceComposites supplying these markets with high quality Chopped Strands and Direct Rovingproducts supported by high performance specialty products like HiPer- tex™ and CFM.3B Binani still shows a strong focus on innovation to develop value-added products for itscustomers in order to deliver product differentiation to improve the profitability and tokeep ahead of competition. All 3B plants are focusing on improving their cost structure byoptimizing production to reach the best efficiencies within the industry. Looking aheadoverall demand growth is expected to continue in glassfibre in both Europe and India withthe economies gaining some momentum. The market growth for glassfibre in both automotiveand wind applications continue to be encouraging and 3B Binani is well positioned to takeadvantage of this BIL Infratech Limited (BILIL)

BILIL is a wholly owned subsidiary of the Company. BILIL is engaged in execution of EPCcontracts for Industrial Civil Construction and Power & Renewable Energy Projects. FinancialHighlights

Rs in Lacs

Particulars 2015-16 2014-15
Total Revenue 32640 31689
Profit before Depreciation Interest and Tax and Exceptional Items 1825 1293
Provision for Depreciation 264 132
Interest and Financial Charges 335 256
Profit / (Loss) before Tax 1227 905
Provision for Tax 484 341
Profit / (Loss) after Tax 711 553

Operations Review

BILIL reported the total revenue of Rs 32640 lacs for the year under review as againstRs 31689 lacs in the previous year. It earned a decent Profit after Tax of Rs 711 lacs ascompared to Rs553 lacs in the previous year.

Industry Overview

The Year 2015-16 continued to be challenging for BILIL even though India achievedrobust 7.6% GDP growth and was globally acknowledged as the world's fastest growingeconomy. Plethora of opportunities predominantly in Infrastructure Rail and Power &Renewable Energy had been visible. The Smart City Mission with assured budgetary supportto create 100 Smart Cities across India had also bolstered the optimism significantly.

In spite of strong signs of economic revival with higher consumer confidence Industryand Infrastructure sector remained sluggish in general. The optimism was not translatedinto realistic opportunity level as it was promising to be earlier.

Outlook

Stable and visionary Government policy reforms strong possibility of simplified Taxregime and continuous efforts to improve Ease-of-doing-business have made India a brightspot in global investment map. Higher Govt. spending in key sectors such asInfrastructure Rail Road Port Power robust FDI in Manufacturing and Defenseproduction will push up growth prospect tremendously.

On-going Policy reforms divestment of PSU stakes relaxed FDI norms to allow foreignplayers in Indian Infrastructure Sector and thrust towards clean Energy and Make-in-Indiawill create investment friendly environment and fuel growth momentum further. This willsignificantly drive demand in key Industry sectors like Cement Steel Mining and otherMetals. Overall there will be high growth scenario in a wide spectrum of industries.

However there is possibility of Govt. funding target not being met. At the same timehigh debt levels of private Infrastructure players cautious approach of Banks for newinvestment due to mounting NPAs and land acquisition issues may discourage privateinvestment and could be potential growth decelerators. Global Composite Holdings Inc.formerly known as CPI Binani Inc. (CPI Binani)

Financial Highlights

In Million USD

Particulars 2015-16 2014-15
Total Revenue - 20.45
Profit before Depreciation Interest and Tax and Exceptional Items (0.21) (0.25)
Provision for Depreciation - 2.10
Interest and Financial Charges - 1.03
Profit / (Loss) before Tax (0.21) (3.39)
Provision for Tax - 2.40
Profit / (Loss) after Tax (0.21) (5.78)

CPI has been incurring losses and in March 2015 it sold its assets to Core MouldingTechnologies Inc USA.

B T COMPOSITES LIMITED (BTCL)

BTCL is wholly owned subsidiary of the Company and is under the process of Voluntarywinding- up.

OTHER SUBSIDIARIES

Following wholly owned Subsidiaries which were incorporated 1-2 years back are yet tocommence any business activities:

a. Royalvision Projects Private Limited

b. Binani Global Cement Holdings Private Limited (Singapore) The above companiesincurred marginal loss for the financial year ended 31st March 2016. This was on accountof certain routine administrative expenses incurred by them.

M/s Royalvision Concrete Private Limited and Royalvision Infratech Private Limited havebeen closed under Section 560 of the Companies Act 1956 (strike off) and the guidelinesissued by the Ministry of Corporate Affairs under the Fast Track Exit mode.

15. AUDIT OBSERVATIONS

The Auditors in their Report have made observations in connection with fair valuationof the Company's investments done by the Company creation of Business Re-organizationReserve (BRR) and transfer of sums to offset certain expenses/ write-offs and outstandingguarantees issued by the Company to banks and financial institutions on behalf ofsubsidiaries including one step down subsidiary which are significant in relation to thenetworth of the Company.

The Board wishes to state as follows:

a. In accordance with the accounting policies applicable to erstwhile Wada IndustrialEstate Limited (WIEL) and to the Company as a successor to WIEL being accounting policiesadopted as per the Scheme of Amalgamation approved by the HonRsble High Court at Kolkataon 18th March 2014 the Company has applied AS 30 the Accounting Standard on FinancialInstruments: Recognition and Measurement issued by the Institute of Chartered Accountantsof India (ICAI) and pursuant thereto has as on March 31 2014 being the date ofconclusion of the first Accounting Year classified the investments as "available forsale financial assets" and has accordingly measured such investments at fair valueas on that date (except for those investments whose fair value cannot be reliablymeasured which investments in accordance with AS 30 are continued to be measured at costand their cost is considered as the fair value). Similar treatment has been given in thecurrent year ended March 31 2016.

b. Similarly in accordance with the aforesaid the Company has withdrawn the amountsfrom BRR arising pursuant to the merger and adoption of AS 30 to meet the expenses likeInterest and Financial Charges Foreign Exchange Loss Fixed Assets written-off Value ofInvestments in subsidiaries written-off expenses related to Scheme of Amalgamation andAdvances to subsidiary written-off.

c. As explained above the subsidiary companies are already working out a restructuring/ resolution package with the banks and institutions and hence in the opinion of themanagement the guarantees are not expected to result into any financial liability to theCompany.

16. DIRECTORS AND KEY MANAGERIAL PERSONNEL (KMP) DIRECTORS:

Pursuant to the provisions of Section 149 of the Act Mr. S. Sridhar and Mr. RahulAsthana were appointed as Additional Director on May 30 2014 and 28th September 2013respectively and they held office until the date of the ensuing Annual General Meeting. Inthe 51st Annual General Meeting held on 29th September 2014 their appointments wereconfirmed. They will hold office upto the conclusion of 53rd Annual General Meeting of theCompany to be held in the calendar year 2016 and are not liable to retire by rotation.They have submitted a declaration that each of them continue to meet the criteria ofindependence as provided U/s 149(6) of the Act. The Company has received notices from aMember alongwith requisite deposit amounts proposing the appointment of Mr. S Sridhar andMr. Rahul Asthana as Independent Directors of the Company at the ensuing Annual GeneralMeeting. The Board has recommended the re appointment of Mr. S Sridhar and Mr. RahulAsthana for a another period of 2 years upto the conclusion of 55th Annual General Meetingto be held in the calendar year 2018. (Refer Notice of AGM Resolution No. 5 & 6)

Mrs. Nidhi Binani Singhania retires by rotation and being eligible has offered herselffor re-appointment.

The Board of Directors appointed Dr. (Mrs.) Sangeeta Pandit as an Additional Directordesignated as Independent Director of the Company with effect from 21st April 2016 interms of provision of Section 161 of the Companies Act 2013 (Rsthe ActRs). Dr. Pandit agedabout 56 years is a Chartered Accountant. She was a partner in P.D. Kunte & Co. andher work included audit consultancy and representing clients at the Income Tax office andas counsel before the Commissioner of Income Tax and Income Tax Tribunal.

She is now in academics and obtained her PhD in Management. She is Head of Finance atSydenham Institute of Management. She is visiting faculty in management institutes ofrepute in Mumbai like Jamnalal Bajaj Institute of Management Studies and Xavier'sInstitute of Management Research and in US like University of Wisconsin and CaliforniaState University. She was part of the start-up team of Unitedworld School of Managementand BSE Management programme. She does consultancy in business strategy and involved incorporate training.

Dr. Pandit shall hold the office upto the date of ensuing Annual General Meeting. TheCompany has received a notice along with requisite deposit from a Member signifying itsintention to propose the candidature of Dr. Pandit as an Independent Director. Yourdirectors recommend appointment of Dr. (Mrs.) Sangeeta Pandit for a term of upto theconclusion of 55th AGM to be held in the calendar year 2018.

Dr. Pandit has given declaration that she meets the criteria of Independence laid downunder Section 149(6) of the Companies Act 2013.

The Board recommends the aforesaid appointment / reappointment of the Directors. Briefprofile of the Directors proposed to be appointed / re-appointed is annexed to the Noticeconvening ensuing Annual General Meeting.

Mrs. Jayantika Dave tendered her resignation vide her letter dated 10th March 2016which was received by the Company on 20th March 2016 and was considered by the Board ofDirectors in their meeting held on 21st April 2016.The Board of Directors wish to placeon record their sincere appreciation for the contribution made by Mrs. Jayantika Daveduring her tenure with the Company as Director. Consequently she also ceases to be memberof the Audit Committee Nomination and Remuneration Committee and StakeholdersRelationship Committee.

Consequent to the resignation of Mrs. Jayantika Dave there were two IndependentDirectors and three Promoter Directors; thereby having less than 50% representation ofIndependent Directors. The requirement of Independent Directors in Board of Directors hasbeen fulfilled by fitting the vacancy created by the resignation of Mrs. Dave byappointment of Dr. (Mrs.) Sangeeta Pandit at the meeting of the Board of Directors held on21st April 2016 in compliance of Regulation 25(6) of SEBI (LODR) Regulations 2015.

KEY MANAGERIAL PERSONNEL (KMP)

The details of the Key Managerial Personnel of the Company appointed pursuant toSection 203 of the Companies Act 2013 are as follows:

Sr. No. Name Designation With effect from To
1 Mr. K K Saraf Company Secretary 1st August 2012 30th September 2015
2 Mr. Sushil Bhatter Manager 1st June2014 30th June2015
3 Ms. Visalakshi Sridhar Chief Financial Officer 1st April 2015 -
Manager 28th July 2015 -
Company Secretary 24th October 2015 -

Board of Directors has formulated a Nomination and Remuneration Policy annexed heretoas Annexure B stating the criteria for determining qualifications positiveattributes and independence of a director and recommends to the Board a policy relatingto the remuneration for the directors key managerial personnel and other employees.

17. AUDITORS

M/s. MZSK & Associates Chartered Accountants Mumbai (Firm RegistrationNo.105047W) were appointed as Statutory Auditors of the Company at the 52nd AGM held on19th December 2015 for a term from the conclusion of the 52nd Annual General Meeting uptothe conclusion of 57th Annual General Meeting subject to the ratification by the Membersat each of the Annual General Meetings. M/s. MZSK & Associates have provided adeclaration to the effect that they continue to be eligible and independent in terms ofSection 141 of the Companies Act 2013 read with Rule 10 Companies (Audit & Auditors)Rules 2014.

Your Board recommends the ratification of appointment of M/s. MZSK & Associates asthe Statutory Auditors of the Company at the 53rd AGM.

18. PARTICULARS OF EMPLOYEES

In terms of the provisions of Section 197(12) of the Companies Act 2013 read withRules 5(2) and 5(3) of the Companies (Appointment and Remuneration of ManagerialPersonnel) Rules 2014 a statement showing the names and other particulars of theemployees drawing remuneration in excess of the limits set out in the said Rules areprovided in the Annexure forming part of the Annual Report.

Disclosures pertaining to remuneration and other details as required under Section197(12) of the Companies Act 2013 read with Rule 5(1) of the Companies (Appointment andRemuneration of Managerial Personnel) Rules 2014 are provided in the Annexure formingpart of this Report.

Having regard to the provisions of Section 136(1) read with its relevant proviso of theCompanies Act 2013 the Annual Report excluding the aforesaid information is being sentto the members of the Company. The said information is available for inspection at theRegistered Office and Corporate Office of the Company during working hours on all workingdays (except Saturdays) upto the date of AGM and any member interested in obtaining suchinformation may write to the Company Secretary and the same will be furnished without anyfee.

19. CONSERVATION OF ENERGY TECHNOLOGY ABSORPTION FOREIGN EXCHANGE EARNING AND OUTGO.

The Company is not being engaged in manufacturing activities hence the particulars inrespect of Conservation of Energy Technology Absorption are not applicable to theCompany.

The details of Foreign Exchange Earnings and Outgo for the Financial Year 2015-16 areas follows:

Rs in Lacs

Foreign Exchange Outgo Amount
Foreign Travelling Expenses 0.27
Interest & Finance Charges on Foreign Currency Loan 4460.63
TOTAL 4460.90
Foreign Exchange Earning Amount
Export Sates (FOB) 85.31
Advertisement and Media Services 10.21
TOTAL 95.52

20. TRANSFER OF UNCLAIMED DIVIDENDS TO INVESTORS EDUCATION AND PROTECTION FUNDS (IEPF).

During the year under review your Company has transferred a sum of Rs 2796432 to theInvestors Education and Protection Fund of Central Government in compliance with Section205C of the Companies Act 1956. This amount represents dividends for the financial year2008-09 which had been lying unclaimed with the Company for a period of 7 years from thedue date of the payment despite reminders sent to concerned shareholders for claiming theamount.

21. MEETINGS OF THE BOARD

During the year under review 6 meetings of the Board of Directors were held. Thedetails such as the dates of meetings attendance of the Directors thereat etc areprovided in Report on Corporate Governance which forms part of this Report.

22. PERFORMANCE EVALUATION

Pursuant to the provisions of the Companies Act 2013 and LODR Regulations IndependentDirectors at their meeting without the participation of the Non-Independent Directors andManagement considered/evaluated the BoardsRs performance Performance of the Chairman andother Non-independent Directors. The Board have undergone a formal review which comprisedBoard effectiveness survey 360 degree and review of materials. This resulted in a fullBoard effectiveness report and DirectorsRs feedback. This is further supported by theChairman's Annual Director Performance Review. The Board subsequently evaluated its ownperformance the working of its Committees (Audit Nomination and Remuneration andStakeholders Relationship Committee) and Independent Directors (without participation ofthe relevant Director). The criteria for performance evaluation have been detailed in theCorporate Governance Report.

23. Vigil Mechanism/ Whistle Blower Policy

Pursuant to Section 177(9) of the Companies Act 2013 read with Rule 7 of the Companies(Meetings of Board and its Powers) Rules 2014 and LODR Regulations the Board ofDirectors had approved the Policy on Vigil Mechanism/ Whistle Blower and the same washosted on the website of the Company. This Policy inter-alia provides a direct access tothe Chairman of the Audit Committee. Your Company hereby affirms that no Director/employee has been denied access to the Chairman of the Audit Committee and that nocomplaints were received during the year. The said policy has been disclosed on thewebsite of the Company and can be accessed at http://binaniindustries.com/investor-retations/binani-industries-Limited/company- policies-codes/

24. AUDIT COMMITTEE

The Audit Committee constituted by the Board complies with the requirements under theAct as wett as LODR Regulations. The details with respect of the composition of the AuditCommittee are included in the Corporate Governance Report which forms part of thisReport.

There was no recommendation of the Audit Committee which were not accepted by theBoard.

25. SECRETARIAL AUDITORS

Pursuant to the provision of Section 204 of the Companies Act 2013 and Rules madethere under the Company had appointed M/s Uma Lodha & Co. Company Secretaries (CPNo.2593) to carry out Secretariat Audit of the Company for the Financiat Year 2015-16. TheSecretariat Auditor Report is annexed to this Report as Annexure C.

26. EXTRACT OF ANNUAL RETURN

An extract of the Annual Return in the prescribed format MGT- 9 as required underSection 92 of the Companies Act 2013 is appended as Annexure D to this Report.

27. INTERNAL FINANCIAL CONTROL SYSTEM AND THEIR ADEQUACY

Given the nature of business and size of operations your company's internal controlsystem has been designed to provide for

a. Accurate recording of transactions with internal checks and prompt reporting.

b. Adherence to applicable Accounting Standards and Policies.

c. Compliance with applicable statutes policies and management policies andprocedures.

d. Effective use of resources and safeguarding of assets.

The Internal Control Systems provides for well documented policies / guidelinesauthorisation and approval procedures. Your Company through a firm of CharteredAccountants carried out periodic audits on all functions based on the plan and brought outany deviation to the Internal Control Procedures. The observations arising out of theaudit are periodically reviewed and compliance ensured. The summary of Internal Auditobservations and status of implementation are submitted to the Audit Committee. The statusof implementation of the recommendations is reviewed by the Audit Committee on a regularbasis and concerns if any are reported to the Board.

28. RISK MANAGEMENT

The Company had identified certain risk areas with regard to the operations of theCompany which was facilitated by a renowned firm of consultants in Mumbai. The InternalAuditors review the steps taken for risk mitigation/ minimization wherever ever possibleand the status of the same is reviewed by the Audit Committee periodically. The Company'sBoard is conscious of the need to periodically review the risks mitigation process.

29. ANTI SEXUAL HARASSMENT POLICY

The Company has adopted a an Anti Sexual Harassment Policy or a policy for preventionprohibition and redressal of Sexual harassment. pursuant to the provisions of sexualharassment of women at work place (Preventions Prohibition & Redressal) Act 2013.The Policy has been placed on the website of the Company www.binaniindustries.com.

During the year under review no complaints were received by the Company pursuant tothe aforesaid Act / Policy.

30. CORPORATE GOVERNANCE

Your Company is fully compliant with the Corporate Governance guidelines as laid outin erstwhile Clause 49 of the Listing Agreement and applicable regulations of LODRRegulations. All the Directors (and also the members of the Senior Management) haveaffirmed in writing their compliance with and adherence to the Code of Conduct adopted bythe Company. The Corporate Governance Report is attached as Annexure E to thisReport.

The Chief Financial Officer has given a certificate of compliance with the Code ofConduct which forms part of Corporate Governance Report as Annexure F requiredunder SEBI LODR Regulations.

M/s Uma Lodha & Co. Practising Company Secretary have certified compliance withCorporate Governance clauses of erstwhile Listing Agreement and LODR Regulations and theCertificate in this regard is attached as Annexure G to this Report.

The Chief Financial Officer (CFO) certification as required under erstwhile Clause 41of the Listing Agreement and Regulation 8)17) of LODR Regulations is attached and formspart of this Report (Annexure H). Related Party disclosures/transactions aredetailed in Notes to the financial statements

31. CORPORATE SOCIAL RESPONSIBILITY (CSR)

The Braj Binani Group through its operating Indian Subsidiaries undertake theactivities on an ongoing basis for upliftment of the weaker sections and welfare of thesociety.

Your Board has constituted a Corporate Social Responsibility Committee (CSR Committee)pursuant to the provisions of Section 135 of the Companies Act 2013 read with Rules madethere under. However your Company is not obliged to spend any amount on CSR activitiesunder the aforesaid provisions of the Act based on the criteria laid down therein.

BINANI CEMENT LIMITED (BCL)

The Braj Binani Group for several years spends considerable amount on an ongoingbasis through its operating companies for social cause and upliftment and welfare of theweaker section of the society and on education of the underprivileged children.

In accordance with the provisions of Section 135 read with Schedule VII of theCompanies Act 2013 the Company as a part of its initiative under the "CorporateSocial Responsibility" drive has adopted a CSR Policy outlining various CSRactivities to be undertaken by the Company in the area of preventive health care makingavailable safe drinking water promoting education ensuring environmental sustainabilityetc. The CSR policy of the Company can be accessed on the Company's weblink

http://www.binanicement.in/investor-relations.

Edayar Zinc Limited (EZL)

The Braj Binani Group through its operating Indian Subsidiaries undertakes theactivities on an ongoing basis for upliftment of the weaker sections and welfare of thesociety.

The mandatory provisions of Section 135 of the Act and Rules made there under withrespect to Corporate Social Responsibility are not applicable to EZL. The Company issocially conscious about its participative role in development of society. The Groupcontinues to undertake CSR activities in Binanipuram where the plant is situated and thesame are well appreciated by the local community at large.

Goa Glass Fibre Limited (GGFL)

The provisions of Section 135 of the Companies Act 2013 and Rules there under withrespect to CSR are presently not applicable to the Company. However as a part of CorporateSocial Responsibility educational program with respect to safety health and environmentwas organized in nearby village Colvale where the Company also conducted free medicalcamps.

32. OTHER DISCLOSURES

Your Directors state that no disclosures or reporting is required in respect of thefollowing items as the same is either not applicable to the Company or relevanttransactions / event have not taken place during the year under review.

a. Issue of Equity shares with differential rights as to dividend voting or otherwise.

b. Issue of shares (including sweat equity shares) to employees of the Company underany scheme.

c. The Managing Director of the Company has not received any remuneration or commissionfrom any of its subsidiaries.

d. No significant or material orders were passed by the Regulators or Courts orTribunals which impact the going concern status and Company's operations in future.

33. RECOGNITION AND REWARDS

The Company's Subsidiaries both in India and abroad have been rewarded by prestigiousBodies / Government in recognition of various initiatives taken by them. Some of them areas follows:- Binani Cement Limited

During the year Binani Cement Limited was honoured to receive the following awards.

> Best Quality Excellence 2014-15

> Second Best Environmental Excellence in Limestone Mines 2014-15

> Second Best Environmental Excellence in Plant Operation 2014-15

> Best Environmental Excellence in Plant operation 2013-14

> Second Best Environmental Excellence in Limestone Mines 2013-14

> Second Best Quality Excellence 2013-14

34. HUMAN RESOURCES

Across the Companies in the Group Employee Relation continues to remain cordial. TheGroup's emphasis on safe work practices and productivity improvement is unrelenting.

The Company had 33 permanent employees on its roll as on March 31 2016. The Boardplaces on record its sincere appreciation for the valuable contribution made by theemployees across all levels in the organization.

35. CAUTIONARY STATEMENT

Statements made in this Report describing the Company's objectives projectionsexpectations and estimates regarding future performance may be "forward lookingstatements" within the meaning of applicable laws and regulations and are based oncurrently available information. The Management believes them to be true to the best ofits knowledge at the time of preparation of this Report. However these statements aresubject to future events and uncertainties which inter-alia include regulatory changestax laws economic developments within the Country and other incidental factors thatcould cause actual results to differ materially from those as may be indicated under suchstatements.

36. ACKNOWLEDGEMENTS

The Directors wish to express their appreciation for the continued co-operation of theCentral and State Governments bankers financial institutions customers dealers andsuppliers and also the valuable assistance and advice received from the joint venturepartners and all the shareholders. The Directors also wish to thank all the employees fortheir contribution support and continued co-operation throughout the year.

For and on behalf of Board of Directors of
Binani Industries Limited.
Date : 29th July 2016 Braj Binani
Place: Mumbai Chairman

ANNEXURE- A

FORM NO.AOC - 2

(Pursuant to clause (h) of sub-section (3) of Section 134 of the Act and Rule 8(2) ofthe Companies (Accounts) Rules 2014) Particulars of contracts/arrangements entered intoby the Company with related parties referred to in sub-section (1) of Section 188 of theCompanies Act 2013 including certain arm's length transactions under third provisothereto

Details of contracts or arrangements or transactions at Arm's length basis.

Name (s) of the related party & nature of relationship Binani Cement Limited (BCL)
BCL is related party in term of Sub-section 2 of Companies
Act 2013.
Nature of contracts/arrangements/transaction Providing of Transportation & other Logistic Services
Duration of the contracts/arrangements/transaction 1st April 2015 to 31st March 2016
Salient terms of the contracts or arrangements or transaction including the value if any Providing of transportation and logistics solutions on day to day basis at the BCL's manufacturing plants. The value of transaction for financial year 2015-16 was Rs 18443.78 Lacs.
Date of approval by the Board Up to 31st December 2014 the services were provided pursuant to the contract dated 16th March 2012. Post 1st January 2015 the services were provided in accordance with generally accepted commercial practices.
Amount paid as advances if any Nil

Details of modifications to contracts or arrangements or transactions beingmodifications not at arm's length basis:

The details of the contracts or arrangements or transactions which were earlier on armslength but varied to suit business requirements is as follows:-

Name(s) of the related party

Binani Cement Limited

Edayar Zinc Limited

(Formerly Binani Zinc Limited)

Nature of relationship Subsidiary Subsidiary

 

Nature of contracts/ arrangements/ transactions Duration of the contracts / arrangements/ transactions Salient terms of the contracts or arrangements or transactions including the value if any a. Management support services
b. sublicensing of Intellectual Property Rights such as Brand Logo & Trade Mark etc
a. For Management Support Services continuing in nature.
b. For Sub-licensing of Intellectual Property Rights - upto 31st March 2021
The aforesaid contracts were entered into prior to the implementation of Section 188 of the Companies Act 2013 at arm's length basis with following terms:
a. For Management Support services 97% of allocable expenses plus 10% Mark up over and above the cost of manpower plus administrative services
b. For Sub-Licensing - 3% of the Net Sales as Royalty However to support the growth and financial restructuring the Company varied the terms not to charge any fees to its subsidiaries under both the contracts.

 

Justification for Variation done in contract during the year Liquidity constraints in BCL. Hence discontinued charging under both the contracts w.e.f. December 13 2014 till March 31 2016 or such other date as may be mutually agreed to Company under BIFR

Hence discontinued charging under both the contracts w.e.f. April 01 2014 till March 31 2016 or such other date as may be mutually agreed to

 

Date(s) of approval by the Board 30th January 2015 7th August 2014
Amount paid as advances if any Nil Nil
Date on which the special resolution was passed in general meeting as required under first proviso to Section 188 Not Applicable Not Applicable

 

For and on behalf of Board of Directors of Binani Industries Limited
Date: 29th July 2016 Braj Binani
Place: Mumbai Chairman

annexure-b

nomination and remuneration policy of binani industries limited

1. BACKGROUND

The Board of Directors("Board") of Binani Industries Limited ("theCompany") has reconstituted Nomination and Remuneration Committee (the Committee)comprising three Independent Directors on 7th August2014 in Line with requirements ofSection 178 of the Companies Act 2013 and Clause 49 of the Listing Agreement.

2. OBJECTIVES

The primary objective of the Policy is to provide a framework and set standards for thenomination remuneration and evaluation of the Directors Key Managerial Personnel andOfficials in the cadre of the senior management. The Company aims to achieve a balance ofmerit experience and skills amongst its Directors Key Managerial Personnel and SeniorManagement.

The Key Objectives of the Committee would be:

2.1 To guide the Board in relation to appointment and removal of Directors KeyManagerial Personnel and Senior Management Personnel;

2.2 To evaluate the performance of the members of the Board and provide necessaryreport to the Board for further evaluation by the Board;

2.3 To recommend to the Board on Remuneration payable to the Directors Key ManagerialPersonnel and Senior Management PersonneL;

2.4 To determine remuneration commensurate with the Company's size and financialposition and trends with respect to the adopted by the peers in the industry;

2.5 To formulate a Policy which wiLL ensure Long term sustainability and retention oftalented managerial personnel.

2.6 To develop a succession plan for the Board and to regularly review thereof.;

3. DEFINITIONS

3.1 Act means the Companies Act 2013 and Rules framed thereunder as amendedfrom time to time.

3.2 Board means Board of Directors of the Company.

3.3 Directors mean Directors of the Company.

3.4 Key Managerial Personnel ("KMP")means

3.4.1 Chief Executive Officer or the Managing Director of the Manager or in theirabsence a Whole time Director;

3.4.2 Company Secretary;

3.4.3 Chief Financial Officer; and

3.4.4 Such other officer as may be prescribed under the Act.

3.5 Senior Management Personnel("SMP") means

personneL of the Company who are members of Company's core management team . This wouLdaLso incLude aLL members of management one LeveL beLow the Executive Directors incLudingaLL functionaL heads.

4. ROLE OF COMMITTEE

4.1 Terms of Reference

4.1.1. To identify persons who are competent to become Directors and who may beappointed as Senior Management Personnel in accordance with the criteria Laid down andrecommend to the Board their appointment and removaL.

4.1.2 To formuLate the criteria for determining quaLifications positive attributes andindependence of a Director and recommend to the Board the policy relating to theremuneration of the Directors Key Managerial Personnel and other employees.

4.1.3 To recommend/review remuneration of the Managing Director(s) and WhoLe-timeDirector(s) based on their performance and defined assessment criteria.

4.1.4 To formuLate the criteria for evaLuation of Independent Directors and the Board;

4.1.5 To carry out evaLuation of every director's performance .

4.1.6 To devise a framework for bringing diversity in the composition of the Board.

4.1.7 To carry out any other function as may be mandated by the Board from time totime and / or enforced by any statutory notification amendment or modification as may beappLicabLe.

5. COMPOSITION AND FUNCTIONING OF THE COMMITTEE

5.1 Composition

5.1.1 The Committee shall be comprised of a minimum of three Non-Executive Directorsmajority of them being Independent Directors.

5.1.2 Any two members of the Committee shall constitute a quorum for the Committeemeetings.

5.1.3 Term of the Committee shall be continued unless terminated by the Board ofDirectors

5.2 Chairperson of the Committee

5.2.1 Chairperson of the Committee shall be an Independent Director.

5.2.2 Chairperson of the Company may be appointed as a member of the Committee butshall not be a Chairman of the Committee.

5.2.3 In the absence of the Chairperson the Members of the Committee present at themeeting shall choose one amongst them to act as Chairperson.

5.3 Frequency of Meetings:

5.3.1 The meeting of the Committee shall be held at such regular intervals as may beconsidered necessary.

5.3.2 The Committee may invite such executives as it considers appropriate to bepresent at the meetings of the Committee.

5.4 Secretary

The Company secretary of the Company shall act as Secretary of the Committee.

5.5 Voting

5.5.1 Matters arising at Committee meetings shall be decided by a majority of votes ofMembers present and any such decision shall for all purposes be deemed a decision of theCommittee.

5.5.2 In the case of equality of votes the Chairman of the meeting will have a castingvote.

5.6 Interested Committee Member not to participate in the meeting.

A Member of the Committee is not entitled to be present when his/her remuneration isdiscussed at such meeting or when his/her performance is being evaluated.

6. POLICY FOR APPOINTMENT AND REMOVAL OF DIRECTOR KMP AND SENIOR MANAGEMENT PERSONNEL.

6.1 Appointment criteria and qualifications

6.1.1. The Committee shall identity and ascertain the integrity qualificationexpertise and experience of the person for appointment as Director KMP or SMP andrecommend to the Board his/her appointment.

6.1.2 A person should possess adequate qualification expertise and experience for theposition he/she is considered for appointment. The Committee has discretion to decidewhether qualification expertise and experience possessed by a person issufficient/satisfactory for the concerned position.

6.1.3 The Company shall not appoint or continue the employment of any person asManaging Director/Whole-time Director who has attained the age of seventy years. Providedthat the term of the person holding this position may be extended beyond the age ofseventy years with the approval of shareholders by passing a special resolution.

6.1.4 Appointment of Independent Directors shall be subject compliance of provisions ofsection 149 of the Companies Act 2013 read with schedule IV and Rules made thereunder

6.2 Term /Tenure

6.2.1. Managing Director / Whole-time Director:

The Company shall appoint or re-appoint any person as its Managing Director orExecutive Director for a term not exceeding five years at a time . No re-appointment shallbe made earlier than one year before the expiry of term.

6.2.2 Independent Director

- An Independent Director shall hold office on the Board of the Company for a term asmay be determines by the Board but in any case not exceeding 5 years and will be eligiblefor re-appointment after passing of a Special Resolution by the Company and disclosure ofsuch appointment in the Board's Report to the Shareholders.

- No Independent Director shall hold office for more than two consecutive terms butsuch Independent Director shall be eligible for appointment after expiry of three years ofceasing to become an Independent Director. Provided that an Independent Director shallnot during the said period of three years be appointed in or be associated with theCompany in any other capacity either directly or indirectly. However if a person who hasalready served as an Independent Director for 5 years or more in the Company as on October1 2014 or such other date as may be determined by the Committee as per regulatoryrequirement; he/she shall be eligible for appointment for one more term of 5 years only.

- At the time of appointment of Independent Director it shall be ensured that number ofBoards on which such Independent Director serves is restricted to seven listed companiesas an Independent Director and three listed companies as an Independent Director in casesuch person is serving as a Whole-time Director of a listed company or such other numberas may be prescribed under the Act.

6.3 Evaluation

The Committee shall carry out evaluation of performance of every Director KMP and SMPon yearly basis or at such frequent intervals as its Members may decide.

6.4 Removal

In case any Director or KMP incurs any disqualification as provided under the ActorRules made thereunder the Committee may recommend to the Board with reasons recorded inwriting removal of such Director or KMP subject however to the provisions and complianceof the said Act rules and regulations.

6.5 Retirement

The Director KMP and Senior Management Personnel shall retire as per the applicableprovisions of the Act and the prevailing policy of the Company. As per the current Policywhile the Independent Directors shall be liable to retire on completion of 75 years ofage a KMP or SMP (excluding the Directors) shall be liable to retire upon completion of58 years of age. The Board if it considers to be in the Company's interest shall have thediscretion to retain an Independent Director KMP and SMP even after attaining theretirement age.

6.6 Policy relating to the Remuneration for the Managing Directors Whole-timeDirector KMP and SMP.

6.7 Remuneration to the KMP and SMP:

6.7.1. Fixed pay:

The KMPs and SMPs shall be eligible for a monthly remuneration as may be approved bythe Board on the recommendation of the Committee. The remuneration shall include salaryallowances perquisites and Company's contribution to Provident Fund as the case may bein accordance with Company's Policy as amended from time to time and approved by theShareholders and Central Government wherever required.

6.7.2 Minimum Remuneration:

If in any financial year the Company has no profits or its profits are inadequatethe Company shall pay remuneration as determined under (6.7.1) above to its ManagingDirector/ Whole-time Director subject to the approval of the Central Government wherevernecessary.

6.7.3 Provisions for excess remuneration:

If any Managing / Whole-time Director draws or receives directly or indirectly by wayof remuneration any such sums in excess of the limits prescribed under the Act or withoutthe prior sanction of the Central Government where required he/ she shall refund suchsums to the Company and until such sum is refunded hold the same in trust for theCompany.

6.8 Remuneration to Non-Executive/ Independent Director.

6.8.1 Remuneration:

Non-Executive / Independent Directors shall not be entitled to any remuneration.

6.8.2 Sitting Fees:

The Non-Executive / Independent Directors will be paid Sitting Fees for attendingmeetings of Board or Committee thereof. Provided that the amount of such fees shall notexceed Rupees One Lac per meeting of the Board or Committee or such amount as may beprescribed by the Central Government from time to time.

6.9 General

6.9.1 The remuneration to the KMPs and SMPs will be determined by the Committee andrecommended to the Board for approval. The remuneration shall be subject to the approvalof the Shareholders of the Company and Central Government wherever required.

6.9.2 Upon evaluation of the performance Annual Increments in the remuneration may berecommended by the Committee to the Board which shall be within the limits approved by theShareholders wherever applicable.

6.9.3 Where any insurance is taken by the Company for its Directors KMPs and SMPs forprotecting them against any liability the premium paid on such insurance shall not betreated as part of the remuneration payable to such persons. Provided that if such personis provided to be guilty the premium paid on such insurance shall be treated as part ofthe remuneration.

ANNEXURE-C

FORM MR-3

SECRETARIAL AUDIT REPORT

[Pursuant to Section 204 (1) of the Companies Act 2013 and Rule 9 of the Companies

(Appointment and Remuneration Personnel) Rules 2014]

FOR THE FINANCIAL YEAR ENDED 31ST MARCH 2016

TO

THE BOARD OF DIRECTORS

BINANI INDUSTRIES LIMITED

We have conducted the Secretariat Audit of the compliance of applicable statutoryprovision and the adherence to good corporate practices by M/S. BINANI INDUSTRIESLIMITED (hereinafter called "the Company"). Secretarial Audit was conductedin a manner that provided me a reasonable basis for evaluating the corporateconducts/statutory compliances and expressing my opinion thereon.

Based on our verification of books papers minute books forms and returns filed andother records maintained by the Company and also the information provided by the Companyits officers agents and authorized representatives during the conduct of secretariataudit We hereby report that in our opinion the Company has during the audit periodcovering the financial year ended 31st March 2016 complied with the statutory provisionslisted hereunder and also that the Company has proper Board-processes andcompliance-mechanism in place to the extent in the manner and subject to the reportingmade hereinafter:

We have examined the books papers minutes books forms and returns filed and otherrecords maintained by M/S. BINANI INDUSTRIES LIMITED for the financial year ended31st March 2016 according to the provisions of:

(i) . The Companies Act 2013 (the Act) and the rules made thereunder;

(ii) . The Securities Contracts (regulation) Act 1956 (SCRA) and the rules madethereunder;

(iii) . The Depositories Act 1996 and the Regulations any Bye-taws framed thereunder;

(iv) . Foreign Exchange Management Act 1999 and the rules and regulations madethereunder to the extent of Foreign Direct Investment

Overseas Direct Investment and External Commercial Borrowings;

(v) . The following Regulations and Guidelines prescribed under the Securities andExchange Board of India Act 1992 (RsSEBI ActRs);

(a) The Securities and Exchange Board of India (Substantial Acquisition of Shares andTakeovers) Regulations 2011;

(b) The Securities and Exchange Board of India (Prohibition of Insider Trading)Regulations 1992(now known as SEBI (prohibition of Insider Trading) Regulation 2015;

(c) The Securities and Exchange Board of India (Issue of Capital and Disclosurerequirements) Regulations 2009;

(d) The Securities and Exchange Board of India (Registrars to issue and Share TransferAgents) Regulations 1993 regarding the Companies Act and deating with ctient;

(vi) . There are no taws specifically applicable in relation to the business of theCompany;

We have also examined compliance with the applicable clauses of the following:

(a) Secretariat Standards issued by the Institute of Company Secretaries of India.

(b) The Listing Agreements entered into by the Company with the Stock Exchanges.

(c) Securities and Exchange Board of India (Listing Obtigations and DisctosureRequirements) Regutations 2015.

During the period under review the Company has comptied with the provisions of theAct Rutes Regutations Guidetines Standards etc. mentioned above.

We further report that:

As per the exptanation given by the Company att the existing retated partytransactions of the Company with its retated parties are in the ordinary course ofbusiness and on arm's tength basis or as per the contracts existing on the commencement ofthe Act 2013 and have been approved by the Audit Committee.

I further report that there were no events/actions in pursuance of:

• The Securities and Exchange Board of India (Issue and Listing of DebtSecurities) Regutations 2008;

• The Securities and Exchange Board of India (Detisting of Equity Shares)Regutations 2009;

• The Securities and Exchange Board of India (Buyback of Securities) Regutations1998;

• The Securities and Exchange Board of India (Emptoyee Stock Option Scheme andEmptoyee Stock Purchase Scheme Guidetines 1999;

We further report that

The Board of Directors of the Company is duly constituted with proper balance ofExecutive Directors Non-Executive Directors and Independent Directors. The changes in thecomposition of the Board of Directors that took place during the period under review werecarried out in compliance with the provisions of the Act.

Adequate notice is given to all Directors to schedule the Board Meetings agenda anddetailed notes on agenda were sent at least seven days in advance and a system exists forseeking and obtaining further information and clarification on the agenda items before themeeting and for meaningful participation at the meeting.

Majority decision is carried through while the dissenting membersRs views are capturedand recorded as part of the minutes.

We further report that there are adequate systems and processes in the Companycommensurate with the size and operations of the Company to monitor and ensure compliancewith applicable laws rules regulations and guidelines.

We further report that during the audit period there were no major events which hadbearing on the Company's affairs in pursuance of the above referred laws rulesregulations guidelines etc. except as follows:

1) At the Board Meeting held on 3rd July 2015 the Board approved the proposalregarding the Merger of Binani Metals Limited with Binani Industries Limited.

2) A Court Convened Meeting of the Shareholders of the Company was held to approve theScheme of Amalgamation of Binani Metals Limited with Binani Industries Limited underSection 391 to 394 of the Companies Act 1956 and the said resolution was approved on 23rdNovember 2015.

3) The HonRsble Calcutta High Court approved the Scheme of Amalgamation of BinaniMetals Limited with the Company on 21st January 2016. E form INC-28 was filed on 5thApril 2016.

For Uma Lodha & Company
Uma Lodha
Proprietor
Place: Mumbai ACS/FCS No. : 5363
Date: 30th May 2016 C.P. No.2593

Note: This report is to be read with our letter of even date which is annexed asANNEXURE B(i)Rs and forms an integral part of this report.

ANNEXURE B(i)

TO

THE MEMBERS

BINANI INDUSTRIES LIMITED

Our report of even date is to be read along with this letter.

• Maintenance of secretarial record is the responsibility of the management of theCompany. Our responsibility is to express an opinion on these secretarial records based onour audit.

• We have followed the audit practices and processes as were appropriate to obtainreasonable assurance about the correctness of the

contents of the Secretarial records. The verification was done on test basis to ensurethat correct facts are reflected in secretarial

records. We believe that the processes and practices we followed provide a reasonablebasis for our opinion.

• We have not verified the correctness and appropriateness of financial recordsand Books of Accounts of the Company.

• Where ever required we have obtained the Management representation about thecompliance of laws rules and regulations and

happening of events etc.

• The compliance of the provisions of Corporate and other applicable laws rulesregulations standards is the responsibility of management. Our examination was limited tothe verification of procedures on test basis.

• The Secretarial Audit report is neither an assurance as to the future viabilityof the Company nor of the efficacy or effectiveness with which the management hasconducted the affairs of the Company.

For Uma Lodha & Company
Uma Lodha
Proprietor
Place: Mumbai ACS/FCS No. : 5363
Date: 30th May 2016 C.P. No.2593

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