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Dhanada Corporation Ltd.

BSE: 531198 Sector: Services
NSE: N.A. ISIN Code: INE041F01015
BSE 14:40 | 19 Jan 4.23 -0.22
(-4.94%)
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NSE 05:30 | 01 Jan Stock Is Not Traded.
OPEN 4.50
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VOLUME 2065
52-Week high 5.60
52-Week low 3.00
P/E
Mkt Cap.(Rs cr) 24
Buy Price 0.00
Buy Qty 0.00
Sell Price 4.23
Sell Qty 900.00
OPEN 4.50
CLOSE 4.45
VOLUME 2065
52-Week high 5.60
52-Week low 3.00
P/E
Mkt Cap.(Rs cr) 24
Buy Price 0.00
Buy Qty 0.00
Sell Price 4.23
Sell Qty 900.00

Dhanada Corporation Ltd. (DHANADACORP) - Director Report

Company director report

To

The Members

DHANADA CORPORATION LIMITED

The Board of Directors of your Company has pleasure in presenting the 31stAnnual Report of the Company together with the Audited statements of accounts for the yearended on 31st March 2017.

1. Financial summary or highlights / Performance of the Company (Standalone andConsolidated):

Your Company's financial summary / performance during the year under review as comparedto the previous year is summarized below:

(Rs. in Crores)

Particulars 2016 – 2017 2015 – 2016
Turnover 8.83 8.53
Profit/(Loss) before Finance charges Tax Depreciation / Amortization 0.33 (0.16)
Finance Charges 2.14 1.86
Profit/(Loss) before Tax Depreciation / Amortization (1.81) (2.02)
Depreciation 1.73 2.09
Profit/(Loss) before Tax (3.54) (4.11)
Provision for Tax Nil Nil
Profit/(Loss) after Tax (3.54) (4.11)
Proposed Dividend Nil Nil

On the basis of consolidated financial statements financial summary / performance ofthe Group is summarized below:

(Rs. in Crores)

Particulars 2016 – 2017 2015 – 2016
Turnover 8.83 8.53
Profit/(Loss) before Finance charges Tax Depreciation / Amortization 1.44 2.10
Finance Charges 2.90 2.56
Profit/(Loss) before Tax Depreciation / Amortization (1.46) (0.46)
Depreciation 2.11 2.55
Profit/(Loss) before Tax (3.57) (3.01)
Provision for Tax (0.002) (0.004)
Profit/(Loss) after Tax (3.57) (3.01)
Minority Interest (0.12) (0.12)
Profit/(Loss) for the year (3.45) (2.89)
Proposed Dividend Nil Nil

2. Dividend:

In view of the losses the Board of Directors does not recommend any dividend for theyear ended on 31st March 2017.

3. Reserves:

No amount is proposed to be transferred to the Reserves.

4. State of Affairs (Standalone and Consolidated):

During the year under review the sales / turnover of Dhanada Corporation Ltd. havemarginally increased as compared to the previous year. However operating margins wereunder pressure. The Company has suffered losses.

The occupancy rate and Average Room Revenue (ARR) remained stagnant due to generaleconomic slowdown.

Paucity of funds affected the performance of the whole Group. The subsidiaries were non– operational during the year due to acute shortage of working capital. Thesubsidiaries have suffered losses.

Finance

The shortage of finance remained a major concern during the year. The parent companywas not able to extend its helping hand due to its own problems.

The management is striving hard to arrange funds for repayment of debt and workingcapital necessary for smooth running of the operations.

Current Year Prospects

The fortune of the hospitality industry has always been linked to the prospects of thetourism industry and general economic growth. On both fronts the current year seems to bepositive. Barring unforeseen difficulties the Hotel is expected to keep up itperformance. However due to stagnant ARR margins are likely to remain under pressure.

As mentioned earlier shortage of finance remains a major factor affecting theperformance of the Company.

5. Change(s) in the nature of business if any:

There is no change in the nature of business of the Company.

6. Material changes and commitments if any affecting the financial position ofthe Company which have occurred between the end of the financial year of the Company towhich the financial statements relate and the date of the report:

The State of Maharashtra through its Competent Authority has filed an application tothe Hon'ble Special Judge (MPID) Pune under The Maharashtra Protection of Interest ofDepositors (in Financial Establishments) Act 1999 (MPID Act) for attachment of the assetsof the Company as published in a Notification dated 7th May 2016 andCorrigendum Notification dated 8th June 2017. However the Company has neverbeen served any official notice or order from the State Government under MPID Act tilldate as stated in the said Application. The Board is of an opinion that this order isultra-virus under the said Act and the Notifications are ex-facie illegal invalid andarbitrary. The Management has decided to file a reply cum counter application forrejecting the application of State of Maharashtra and releasing the assets of the Company.

7. Details of significant and material orders passed by the regulators / courts/ tribunals impacting the going concern status and the Company's operations in future:

Nil. No such orders are passed during the year under review.

8. Statement in respect of adequacy of internal financial controls withreference to the Financial Statements:

Internal Financial controls are adequate and operating effectively commensurate withthe size nature of operations of the Company.

The separate report of the Auditors about the existence of internal financial controlssystem and its operations is attached to the Auditor's Report as an Annexure B to theAuditor's Report.

9. Details of Subsidiary / Associate Companies / Joint Ventures:

Dhanada Engineering Private Limited Dhanada Education Private Limited and DhanadaClean Energy (India) Private Limited are subsidiaries of the Company. The Company has noAssociate Company / Joint Venture.

The Company has formulated policy for determining Material Subsidiaries. The saidpolicy is available on the website of the Company. A web link thereto ishttp://dhanadacorp.com/pdf/ Policy_for_deteriming_Material_Subsidiary.pdf.

A statement containing the salient features of the financial statement of subsidiariesin Form No. AOC-1 is attached as Annexure 1 to the Directors' Report.

The Consolidated financial statements prepared in accordance with Section 129(3) ofthe Companies Act 2013 and listing agreement form part of the Annual Report.

Further in accordance with Section 136 of the Companies Act 2013 the auditedfinancial statements including consolidated financial statements and all other documentsrequired to be attached thereto and audited accounts of subsidiaries are available on thewebsite of the Company www.dhanadacorp.com.

10. Performance and financial position of each of the subsidiaries included in theconsolidated financial statement:

Dhanada Engineering Private Limited a Company engaged in manufacture of press partsfor automobile industry is a subsidiary of your Company.

Dhanada Education Private Limited a Company engaged in the business of providingeducation and training is a subsidiary of your Company.

Dhanada Clean Energy (India) Private Limited a Company engaged in manufacture of andselling of wind power driven turbines is a subsidiary of your Company.

All the aforesaid subsidiaries were non – operational during the year due to acuteshortage of working capital and have suffered losses.

11. Particulars of loans / advances / guarantees / investments outstanding during thefinancial year:

The particulars of loans / advances / guarantees / investments covered under Section186 of the Companies Act 2013 and as per SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 are given in the notes to the financial statementsprovided in the Annual Report.

12. Deposits:

The Company has not accepted deposits from the public within the meaning of Section 73of the Companies Act 2013 and the rules framed there under.

13. Auditors:

Statutory Auditors

M/s. Shashank Patki and Associates Chartered Accountants Pune were appointed asStatutory Auditors of the Company in the 30th Annual General Meeting held on 30thSeptember 2016 to hold office till the conclusion of 35th Annual GeneralMeeting. Pursuant to Section 139(1) of the Companies Act 2013 the Company will place thematter related ratification of such appointment before the members at the ensuing annualgeneral meeting.

Secretarial Auditor

Mr. R. V. Pore Practicing Company Secretary was appointed to conduct the secretarialaudit of the Company for the financial year 2016 – 2017 as required under Section204 of the Companies Act 2013 and rules made there under. The Secretarial Audit Report inForm No. MR-3 for the financial year 2016 – 2017 is attached as Annexure 2 to theDirectors' Report.

14. Explanations or comments on qualification reservation or adverse remark ordisclaimer in Auditor's Report:

The Audit Report contains certain observations and we offer our comments in this regardas under:

Note 13 of Note 28B – Other Notes on Accounts:

There will be no significant impact on accounts (financial as well as disclosure) ofthe Company.

Note 10

The Company has acquired land at Nande from Dr. Laxman V. Kulkarni pursuant to theScheme of Amalgamation approved by the Hon'ble High Court Mumbai. As per the Scheme theCompany was required to allot 1796254 Equity Shares and pay Rs. 3499996.98additionally as a consideration for the said land to Dr. Kulkarni by executing separateConveyance Deed. However the management was advised that the allotment is required to bemade before the execution of the Conveyance Deed. Accordingly in good faith the Boardallotted the necessary shares to Dr. Kulkarni and prepared the deed for registration.However Dr. Kulkarni expressed his desire for upward revision of the totalconsideration as the prices of the land have gone up considerably since 01.04.2008 i.e.the appointed date and the market price of the equity shares of the Company have notappreciated in line with the same. Due to this the conveyance deed with Dr. Laxman V.Kulkarni is not yet done. The management is exploring ways and means to sort out the issueand hopes that the same will be resolved amicably. However until the financialdifficulties are resolved a solution to this issue appears remote. After settlement ofthe issue and completion of all legal formalities the aforesaid amounts accounted forunder Fixed Assets Share Capital Share Premium will stand confirmed.

Auditor's comment related to advance paid to Dr. Laxman V. Kulkarni:

The Company has acquired land at Nande from Dr. Laxman V. Kulkarni pursuant to theScheme of Amalgamation approved by the Hon'ble High Court Mumbai. As per the Scheme theCompany was required to allot 1796254 Equity Shares and pay Rs. 3499996.98additionally as a consideration for the said land to Dr. Kulkarni by executing separateConveyance Deed. However Dr. Kulkarni expressed his desire for upward revision of thetotal consideration as the prices of the land have gone up considerably since 01.04.2008i.e. the appointed date and the market price of the equity shares of the Company have notappreciated in line with the same. The Company has paid Rs.39100000/- to Dr. Kulkarnias Advance against the said land. However due to financial difficulties the Company isnot able to pay the balance amount as desired by Dr. Kulkarni. Due to this the conveyancedeed with Dr. Laxman V. Kulkarni is not yet done. The management is exploring ways andmeans to sort out the issue and hopes that the same will be resolved amicably. Howeveruntil the financial difficulties are resolved a solution to this issue appears remote.After settlement of the issue the amount of Rs. 39100000/- will be added to the FixedAssets under Land.

Auditor's Comment – No provision has been made for interest on Sales Tax Defermentand interest / penalties for non-payment / late payment of statutory dues and fornon-compliance of legal formalities etc. if any. The amount is not ascertainable:

Phoenix ARC Pvt. Ltd. / Saraswat Co. Op. Bank Ltd. are not providing the statement ofdues / interest / penal interest / other charges if any. Hence the Company has providedin its books as per the contractual rate of interest. As far as Sales Tax demand isconcerned the Company has provided as per the Assessment Order. The penal interest /penalties are not provided for due to financial difficulties.

Auditor's Comment – In the absence of the records seized by Police authoritiesthe correctness of the amounts written off is not ascertainable:

The management is unable to estimate the impact of audit qualification. However itbelieves that there will be no significant impact on accounts (financial as well asdisclosure) of the Company.

Statutory Dues:

Due to financial difficulties the Company could not pay the deferred sales tax.However the Company will settle the dues. The delay was also occurred in payment ofcertain statutory dues due to financial difficulties.

Rest of the Auditor's observations are self explanatory.

15. Explanations or comments on qualification reservation or adverse remark ordisclaimer in Secretarial Audit Report:

Statutory Auditors did not hold Peer Review Certificate on the date of appointment:

The Auditor states that they had applied for conducting peer review of their firm tothe Peer Review Board of Institute of Chartered Accounts of India (ICAI) in January 2017.The final Peer Review Report is filed by the Reviewer to Peer Review Board of ICAI on25.05.2017. The Certificate of Peer Review is awaited.

Non – publishing notices etc. in the newspapers as required under ListingRegulations:

The Company has submitted notices quarterly unaudited financial results and auditedfinancial statements etc. required under SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015 to the Bombay Stock Exchange Ltd. within the prescribedtime and the same were also made available on the website of the Company. However due tofinancial difficulties the Company did not publish notices results and statements etc.in the newspapers.

Discrepancies in the issued share capital and listed share capital:

Due to technical issues some formalities in respect of issue of shares made under theScheme of Arrangement and Amalgamation are not yet completed; hence those shares and theshares further issued by the Company through private placement are yet to be listed. TheCompany is in a process to resolve the issue. However until the financial difficultiesare resolved a solution to this issue appears remote.

Non – appointment of Company Secretary during the period from 30.01.2015 to11.08.2016:

The management was looking for a suitable candidate to fill the vacancy caused byresignation of previous Company Secretary. The Board of Directors has appointed a CompanySecretary and Compliance Officer in its meeting held on 12.08.2016.

Inadequate number of Independent Directors during the period from 12.05.2015 to29.09.2016:

The management was looking for a suitable candidate to fill the vacancy caused byresignation of previous Independent Director. The Company has appointed one moreIndependent Director in the Annual General Meeting held on 30.09.2016.

Delay in resolving the complaints lodged on SEBI Complaints Redress System (SCORES)platform and submitting Action Taken Reports:

The delay was occurred due to some administrative problems. The delay was not donedeliberately or intentionally or due to negligence on the part of the Company. Howeverthe complaints are now resolved and closed by the SEBI. As on date there are nocomplaints pending with the Company and / or SEBI.

Non – filing of Form PAS – 3 (earlier Form-2) for allotment of Equity sharesmade on 30th April 2010:

In respect of allotment of Equity shares against consideration other than cash theCompany has to file stamped document with the Registrar of Companies along with Form PAS– 3 (earlier Form 2) i.e. Return of Allotment. Due to the pendency of payment ofstamp duty on High Court Order dated 16th July 2009 the Company is not able tofile the said form with the Registrar of Companies in respect of Equity Shares allotted toDr. Laxman V. Kulkarni.

Hundred percent of shareholding of promoters and promoters group is not indematerialized form:

As explained earlier due to technical issues some formalities in respect of 2900879Equity shares issued under the Scheme of Arrangement and Amalgamation to promoter are notyet completed; hence those shares and 5417000 Equity shares further issued by theCompany through private placement to promoter are yet to be listed. As the allottee cannotdematerialize the securities issued to him before listing of the same on the relevantstock exchange the 8317879 Equity shares held by the promoter(s) / promoter group arein physical form. The Company is in a process to resolve the issue.

Independent Directors did not comprise 50% of the Board Strength during the period from12.05.2015 to 29.09.2016:

The Company had only 1 (One) Independent Director during the period from 12.05.2015 to29.09.2016. The management was looking for a suitable candidate to fill the vacancy causedby resignation of previous Independent Director. The Company has appointed new IndependentDirector in place of the Independent Director who has resigned on 12.05.2015 in terms ofRegulation 25(6) SEBI (Listing Obligations and Disclosure Requirements) Regulations 2015in the Annual General Meeting held on 30.09.2016.

Composition of Audit Committee:

The Company had only 1 (One) Independent Director during the period from 12.05.2015 to29.09.2016. The management was looking for a suitable candidate to fill the vacancy causedby resignation of previous Independent Director. The Company has appointed one moreIndependent Director in the Annual General Meeting held on 30.09.2016. Thereafter in theBoard Meeting held on 14th November 2016 the Audit Committee duly wasreconstituted.

Composition of Nomination and Remuneration Committee:

The Company had only 1 (One) Independent Director during the period from 12.05.2015 to29.09.2016. The management was looking for a suitable candidate to fill the vacancy causedby resignation of previous Independent Director. The Company has appointed one moreIndependent Director in the Annual General Meeting held on 30.09.2016. Thereafter in theBoard Meeting held on 14th November 2016 the Nomination and RemunerationCommittee was duly reconstituted.

Requirement of quorum is not met for Audit Committee Meetings:

The Audit Committee meets at regular intervals as prescribed in Regulation 18(2)(a) ofSEBI (Listing Obligations and Disclosure Requirements) Regulations 2015. Howeverrequirement of quorum for Audit Committee meetings as prescribed in Regulation 18(2)(b) ofSEBI (LODR) Regulations 2015 / Clause 49 of the Listing Agreement was not met for themeetings held during the period from 12.05.2015 to 14.11.2016 due to inadequate number ofIndependent Directors. The Company has appointed one more Independent Director in theAnnual General Meeting held on 30.09.2016. Thereafter in the Board Meeting held on 14thNovember 2016 the Audit Committee was duly reconstituted.

Complaints against Chairman Directors and the Company:

The complaints and cases are still pending in the respective court/s. The Chairman andthe Directors are not yet convicted.

Application filed by the State Government under MPID Act for attaching assets of theCompany:

The State of Maharashtra through its Competent Authority has filed an application tothe Hon'ble Special Judge (MPID) Pune under The Maharashtra Protection of Interest ofDepositors (in Financial Establishments) Act 1999 (MPID Act) for attachment of the assetsof the Company as published in a Notification dated 7th May 2016 andCorrigendum Notification dated 8th June 2017. However the Company has neverbeen served any official notice or order from the State Government under MPID Act tilldate as stated in the said Application. The Board is of an opinion that this order isultra-virus under the said Act and the Notifications are ex-facie illegal invalid andarbitrary. The Management has decided to file a reply cum counter application forrejecting the application of State of Maharashtra and releasing the assets of the Company.

Notice of Recovery of stamp duty received from the Collector of Stamps Mumbai:

Due to severe financial difficulties the Company could not pay the stamp duty. Themanagement is striving hard to sort out the financial issue. Thereafter the Company willsettle the dues.

The registered office of the Company is sealed by the Investing Officer of EconomicOffices Wing (EOW) since 20th December 2016:

On 20th December 2016 the registered office of the Company was sealed bythe Investing Officer of Economic Offices Wing (EOW) Pune illegally and without courtpermission. The action taken by EOW is challenged by the Company in the appropriate courtand the decision is pending.

Rest of the Secretarial Auditor's observations are self explanatory.

16. Share Capital:

There were no changes in the share capital during the year under review.

17. Extract of the Annual Return:

The extract of annual return as on the financial year ended on 31st March2017 in Form No. MGT-9 is enclosed as Annexure 3 and forms part of the Directors' Report.

18. Conservation of energy technology absorption foreign exchange earnings and outgo:

The Company through constant monitoring selection of energy saving equipments andeducation of staff and guests endeavors to conserve and optimize the use of energy.

The Company does not undertake any research and development activity neither does ituse any imported technology.

Foreign Exchange Earnings : Nil
Foreign Exchange Outgo : Nil

19. Corporate Social Responsibility (CSR):

The provisions of Section 135 of the Companies Act 2013 are not applicable to theCompany.

20. Directors:

Change in Directors and Key Managerial Personnel (KMP)

Mr. Dilip A. Prabhune (DIN 01779383) is appointed as Independent Director for the termof 5 (five) consecutive years w.e.f. 30th September 2016. Accordingly thecomposition of the Board is reconstituted as per the provisions of the Companies Act 2013& SEBI (LODR) Regulations 2015.

Mrs. Smita Mishra appointed as Company Secretary and Compliance Officer w.e.f. 12thAugust 2016.

Appointments

Mr. Ramesh R. Havele (DIN 00007580) retires by rotation at the ensuing Annual GeneralMeeting and is eligible for re-appointment. Your Directors recommend his re-appointment.

None of the independent directors will retire at the ensuing Annual General Meeting.

Statement on declaration given by Independent Directors

The Company has received necessary declaration from Independent Directors under Section149(7) of the Companies Act 2013 that they meets the criteria of independence laid downin Section 149(6) of the Companies Act 2013 and SEBI (Listing Obligations and DisclosureRequirements) Regulations 2015.

Relationship between directors inter-se

Mr. Ramesh R. Havele (DIN 00007580) and Mrs. Veena R. Havele (DIN 00007593) are relatedto each other as husband and wife.

Formal Annual Evaluation

The evaluation of the Board and its committees evaluation of performance of individualdirectors and independent directors in compliance with SEBI (Listing Obligations andDisclosure Requirements) Regulations 2015 Schedule IV and other applicable provisions ofthe Companies Act 2013 was conducted based on the criteria such as the Board compositionand structures effectiveness of board processes information and functioningcontribution of the individual Director to the Board and Committee meetings likepreparedness on the issues to be discussed meaningful and constructive contribution andinputs in meetings etc.

The performance of independent directors was evaluated by the entire Board ofDirectors.

Details of familiarisation programmes of Independent Directors

The Company has a policy to keep the Independent Directors informed and updated aboutthe business and the operations of the Company on a continuous / as needed basis. Inorder to familiarise the Independent Directors with the Company and to inform them abouttheir roles rights and responsibilities the Company conducts the orientation programsfor them.

The Company conducts an induction program for every new Independent Director joiningthe Company's Board covering the organization structure Company's business and itssubsidiaries.

The Company issues detailed letter of appointment to the Independent Directorsdetailing their roles and duties to be performed as an Independent Director on the Boardof the Company.

The details of familiarisation programmes are available on the website of the Company.The web link thereto ishttp://dhanadacorp.com/pdf/Details%20of%20Familiarisation%20programme%20for%20IDs.pdf.

21. Number of meetings of Board of Directors:

During the financial year 2016 – 2017 4 (Four) meetings of the Board of Directorswere held.

22. Audit Committee:

The composition of Committee is reconstituted with effect from 14thNovember 2016.

Now the Audit Committee consists of three members i.e. Mr. Dilip A. Prabhune (DIN01779383) Chairman of the Committee and Mr. Shreeniwas G. Kale (DIN 00150957) and Mrs.Veena R. Havele (DIN 00007593).

All recommendations made by the Committee during the year were accepted by the Board.

23. Stakeholders Relationship Committee:

The composition of Committee is reconstituted with effect from 14thNovember 2016.

Now the Stakeholders Relationship Committee consists of three members i.e. Mr.Shreeniwas G. Kale (DIN 00150957) Chairman of the Committee and Mrs. Veena R. Havele (DIN00007593) and Mr. Dilip A. Prabhune (DIN 01779383).

The Committee reviews and ensures redressal of investor grievances. During the year2016 – 17 5 complaints were received from the shareholders and all complaints havebeen resolved to the satisfaction of shareholders. There are no investor complaintspending as on 31st March 2017.

24. Nomination and Remuneration Committee:

The composition of Committee is reconstituted with effect from 14thNovember 2016.

Now the Nomination and Remuneration Committee consists of three members i.e. Mr.Shreeniwas G. Kale (DIN 00150957) Chairman of the Committee and Mrs. Veena R. Havele (DIN00007593) and Mr. Dilip A. Prabhune (DIN 01779383).

The Committee has formulated policy on nomination and remuneration of Directors KeyManagerial Personnel Senior Management Personnel and other employees including criteriafor determining qualifications positive attributes and independence of directorperformance evaluation and other matters in compliance with Section 178 of the CompaniesAct 2013 read with rules made there under and SEBI (Listing Obligations and DisclosureRequirement) Regulations 2015.

The said policy is also available on the website of the Company. A web link thereto ishttp://dhanadacorp.com/pdf/ Nomination%20and%20Remuneration%20Policy.pdf.

The Committee operates as per the policy adopted by the Board. All recommendations madeby the Committee were accepted by the Board.

25. Details of establishment of vigil mechanism for directors and employees:

The Company has established Whistle Blower / Vigil Mechanism Policy for directors andemployees to report concerns about unethical behaviour actual or suspected fraud orviolation of the Company's Code of Conduct and Ethics. The said policy is also availableon the website of the Company. A web link thereto is http://dhanadacorp.com/pdf/Vigil%20Mechanism%20Policy.pdf.

26. Particulars of contracts or arrangements with related parties:

The Company has not entered into any contracts or arrangements with related partiesreferred to in Section 188(1) of the Companies Act 2013.

The Company has formulated policy on materiality of Related Party Transactions and alsoon dealing with Related Party Transactions in compliance with SEBI (Listing Obligationsand Disclosure Requirement) Regulations 2015. During the year the Company has not enteredinto any transaction with related parties which could be considered material in accordancewith the policy of the Company on related party transactions and listing agreement.

The said policy is available on the website of the Company. A web link thereto ishttp://dhanadacorp.com/pdf/ Related_Party_Transactions_Policy.pdf.

27. Managerial Remuneration:

No director draws any remuneration from the Company.

Remuneration of Key Managerial Personnel (KMP)

Name of KMP Designation Remuneration in 2016 – 17 Remuneration in 2015 – 16 % Increase of remuneration
(Rs.) (Rs.)
Mr. Ramesh Pradhan Chief Financial Officer 333000/- 288000 16%
*Mrs. Smita Mishra Company Secretary 67800/- N.A. N.A.**

*Appointed w.e.f. 12.08.2016

**Annual increase in remuneration is not applicable as the appointment was made on12.08.2016 and remuneration for F.Y. 2016 – 17 is for the period 12.08.2016 to31.03.2017 only.

Median Remuneration of Employees (MRE) was Rs. 10035/- and Rs. 9350/- in thefinancial year 2016 – 17 and 2015 – 16 respectively. The increase in MRE in thefinancial year 2016 - 17 as compared to financial year 2015 - 16 is 7.33%.

The number of permanent employees on the rolls of the Company as on 31.03.2017 and31.03.2016 are 36 and 30 respectively.

The revenue of the Company has gone up by 5.85%. The Company has suffered losses. Theremuneration of the employees has increased by 10.88%.

The closing price of the Company's equity shares on BSE as of 31.03.2017 was Rs. 4.51representing a 55% decrease from IPO price.

It is affirmed that the remuneration of employees and KMPs is as per the remunerationpolicy of the Company.

No employee of the Company is receiving remuneration exceeding the limits prescribedunder Rule 5(2) of the Companies (Appointment and Remuneration of Managerial Personnel)Rules 2014.

28. Risk Management Policy:

In compliance with SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 the Company has laid down procedures to inform Board members about the riskassessment and minimization procedures. The Board of Directors has also framed RiskManagement Policy / Plan. The said policy is available on the website of the Company. Aweb link thereto is http://dhanadacorp.com/pdf/Risk%20Management%20Policy.pdf.

29. Corporate Governance and Management Discussion and Analysis Report:

The Company is committed to achieve business excellence and stakeholders' welfarethrough good corporate governance and adhere to the corporate governance requirements setout by SEBI. As per SEBI (Listing Obligations and Disclosure Requirements) Regulations2015 Management Discussion and Analysis Report and Report on Corporate Governance alongwith Certificate of Compliance from Auditors are annexed and form part of the Directors'Report.

30. Directors' Responsibility Statement:

The Directors of the Company hereby state that:

a) in the preparation of the annual accounts the applicable accounting standards hadbeen followed along with proper explanation relating to material departures;

b) the Directors had selected such accounting policies and applied them consistentlyand made judgments and estimates that are reasonable and prudent so as to give a true andfair view of the state of affairs of the Company at the end of the financial year and ofthe profit and loss of the Company for that period;

c) the Directors had taken proper and sufficient care for the maintenance of adequateaccounting records in accordance with the provisions of the Companies Act 2013 forsafeguarding the assets of the Company and for preventing and detecting frauds and otherirregularities;

d) the Directors had prepared the annual accounts on a going concern basis;

e) the Directors had laid down internal financial controls to be followed by theCompany and that such internal financial controls are adequate and were operatingeffectively;

f) the Directors had devised proper systems to ensure compliance with the provisions ofall applicable laws and that such systems were adequate and operating effectively.

31. Sexual Harassment of Women at workplace (Prevention Prohibition and Redressal)Act 2013:

No complaint was received or filed under the Act during the year.

32. Acknowledgements:

The Directors express their sincere thanks to Dhanada Holdings Private Limited theparent company the Bankers employees and stakeholders for their continued support andthe faith and belief shown by them.

For and on behalf of the Board of Directors
DHANADA CORPORATION LIMITED
Ramesh R. Havele Veena R. Havele
Place : Pune Chairman & Managing Director Director
Date : 14th August 2017 (DIN 00007580) (DIN 00007593)